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Chap002 MIS
 

Chap002 MIS

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    Chap002 MIS Chap002 MIS Presentation Transcript

    • 1Chapter 2 Competing with Information TechnologyMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 2 ObjectivesIdentify basic competitive strategies and explain how IT may be used to gain competitive advantage.Identify strategic uses of information technology.How does business process engineering frequently use e-business technologies for strategic purposes?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 3 (Objectives – continued)Identify the business value of using e-business technologies for total quality management, to become an agile competitor, or to form a virtual company.Explain how knowledge management systems can help a business gain strategic advantage.McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 4 Section I Fundamentals of Strategic AdvantageMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 5 Fundamentals of Strategic AdvantageCompetitive Forces (Porter) Bargaining power of customers Bargaining power of suppliers Rivalry of competitors Threat of new entrants Threat of substitutesMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 6 Competitive Strategies & the Role of ITCost Leadership (low cost producer) Reduce inventory (JIT) Reduce manpower costs per sale (see Real World Case 1) Help suppliers or customers reduce costs Increase costs of competitors Reduce manufacturing costs (process control)McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 7 Competitive Strategies & the Role of IT (continued)Differentiation Create a positive difference between your products/services & the competition. May allow you to reduce a competitor’s differentiation advantage. May allow you to serve a niche market.McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 8 Competitive Strategies & the Role of IT (continued)Innovation New ways of doing business Unique products or services New ways to better serve customers Reduce time to market New distribution modelsMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 9 Competitive Strategies & the Role of IT (continued)Growth Expand production capacity Expand into global markets Diversify Integrate into related products and services.McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 10 Competitive Strategies & the Role of IT (continued)Alliance Broaden your base of support New linkages Mergers, acquisitions, joint ventures, “virtual companies” Marketing, manufacturing, or distribution agreements.McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 11 Competitive Strategies & the Role of IT (continued)Other Competitive Strategies Locking in customers or suppliers Build value into your relationship Creating switching costs Extranets Proprietary software applicationsMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 12 Competitive Strategies & the Role of IT (continued)Other Competitive Strategies (continued) Raising barriers to entry Improve operations or promote innovation Leveraging investment in IT Allows the business to take advantage of strategic opportunitiesMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 13 The Value ChainViews a firm as a series, chain, or network of activities that add value to its products and services. Improved administrative coordination Training Joint design of products and processes Improved procurement processes JIT inventory Order processing systemsMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 14 Value Chain (continued)McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 15 Section II Using Information Technology for Strategic AdvantageMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 16 Strategic Uses Of Information TechnologyMajor competitive differentiatorDevelop a focus on the customer Customer value Best value Understand customer preferences Track market trends Supply products, services, & information anytime, anywhere Tailored customer serviceMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 17 Strategic Uses of IT (continued)Business Process Reengineering (BPR) Rethinking & redesign of business processes Combines innovation and process improvement There are risks involved. Success factors Organizational redesign Process teams and case managers Information technologyMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 18 Strategic Uses of IT (continued)Improve business quality Total Quality Management (TQM) Quality from customer’s perspective Meeting or exceeding customer expectations Commitment to: Higher quality Quicker response Greater flexibility Lower costMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 19 Strategic Uses of IT (continued)Becoming agile Four basic strategies Customers’ perception of product/service as solution to individual problem Cooperate with customers, suppliers, other companies (including competitors) Thrive on change and uncertainty Leverage impact of people and people’s knowledgeMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 20 Strategic Uses of IT (continued)The virtual company Uses IT to link people, assets, and ideas Forms virtual workgroups and alliances with business partners Interorganizational information systemsMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 21 The Virtual Company (continued) Strategies Share infrastructure & risk with alliance partners Link complementary core competencies Reduce concept-to-cash time through sharingMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 22 The Virtual Company (continued) Strategies (continued) Increase facilities and market coverage Gain access to new markets and share market or customer loyalty Migrate from selling products to selling solutionsMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 23 Learning OrganizationsExploit two kinds of knowledge Explicit TacitMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 24 Learning Organizations (continued) Knowledge ManagementMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 25 Learning Organizations (continued)Knowledge management systems Help create, organize, and share business knowledge wherever and whenever needed within the organizationMcGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 26 Discussion QuestionsYou have been asked to develop e-business & e-commerce applications to gain competitive advantage. What reservations might you have about doing so?How could a business use IT to increase switching costs and lock in its customers and suppliers?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 27 Discussion Questions (continued)How could a business leverage its investment in IT to build strategic IT capabilities that serve as a barrier to entry by new entrants into its markets?What strategic role can information technology play in business process reengineering and total quality management?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 28 Discussion Questions (continued)How can Internet technologies help a business form strategic alliances with its customers, suppliers, and others?How could a business use Internet technologies to form a virtual company or become an agile competitor?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 29 Discussion Questions (continued)IT can’t really give a company a strategic advantage, because most competitive advantages don’t last more than a few years & soon become strategic necessities that just raise the stakes of the game. Discuss.MIS author & consultant Peter Keen says: “We have learned that it is not technology that creates a competitive edge, but the management process that exploits technology.” What does he mean?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 30 Real World Case 1 – WESCO International, Inc.Business-to-BusinessDescribe WESCO’s original system.Describe WESCO’s new system.McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 31 Real World Case 1 (continued)What are the business benefits to WESCO and its suppliers of its new e-procurement system?Is WESCO’s new system a strategic use of IT?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 32 Real World Case 1 (continued)Does WESCO’s new system give the company a competitive advantage?What other strategic moves could WESCO implement to gain competitive advantage?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 33 Real World Case 2 – Staples, Inc.What is the strategic business value to Staples and their large business clients of the new web-based procurement system?What is the strategic business value to Staples and the value proposition to their customers of their new clicks and bricks capabilities?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 34 Real World Case 2 (continued)Is an integrated clicks and bricks strategy the Internet strategy that most businesses, large and small, should adopt?What competitive strategies is Staples pursuing?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 35 Real World Case 2 (continued)What other e-business or e-commerce strategy would you recommend to Staples to help them gain a competitive advantage in their industry?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 36 Real World Case 3 – Enron Corp.What mistakes did Enron make in the use or management of IT?Did those mistakes play a part in the failure of Enron?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 37 Real World Case 3 (continued)“Is it time to go back to the days when IT supported the business rather than became the business?” Explain your position.What are the major lessons for the future use of IT in business that you gained from this case?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 38 Real World Case 3 (continued)How would you apply one of the lessons from this case in your present job or in your future business career?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 39 Real World Case 4 – Delta Technology & FirstHealth GroupWhat are Delta Technology’s new requirements for IT investments?What is the business value of Delta’s new requirements?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 40 Real World Case 4 (continued)Explain FirstHealth’s “return on opportunity” guidelines.Is FirstHealth’s “return on opportunity” guideline for IT investments a good way to evaluate investments in IT?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 41 Real World Case 4 (continued)What should be the role of ROI in IT decision- making?Are the IT investment guidelines of Delta and FirstHealth applicable to other companies, including small businesses?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 42 Real World Case 5 – Ford, Dow Chemical, IBM, et al.What is Six Sigma?What do critics of Six Sigma see as its shortcomings?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 43 Real World Case 5 (continued)Is Six Sigma “an enterprise-wide business strategy?”What role does information technology play in Six Sigma business initiatives?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.
    • 44 Real World Case 5 (continued)What are the benefits and limitations of Six Sigma as a business strategy?Can Six Sigma make up for poor management and faulty vision?McGraw-Hill/Irwin Copyright © 2004, The McGraw-Hill Companies, Inc. All rights reserved.