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Chap011
- 2. Chapter 11 Developing Business/IT Strategies McGraw-Hill/Irwin Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.
- 4. 11-4 Organizational planning This fundamental planning process consists of: Team building, modeling, and consensus Evaluating what an organization has accomplished and the resources they have acquired
- 5. 11-5 Organizational Planning analyzing their business, economic, political, and societal environments; Anticipating and evaluating the impact of future developments building a shared vision and deciding on what goals they want to achieve deciding which actions to take to achieve their goals
- 7. 11-7 Planning Fundamentals IT created a seismic shift Just knowing the importance and structure of e-business is not enough Must be able to transform an old business design to a new e-business design
- 8. 11-8 Scenario Approach Gaining popularity Less formal Virtual world (microworld) exercises Business scenarios are created and evaluated Alternative scenarios are then created
- 10. 11-10 SWOT Analysis Strengths Core competencies and resources Weaknesses Areas of substandard business performance Opportunities Potential for new business markets or innovative breakthroughs Threats Potential for business and market losses
- 11. 11-11 Balanced Scorecard Measures activities in terms of vision and strategies Financial performance Impact on customers Performance of key business processes Company’s learning curve and growth Four processes Translate vision into operational goals Communicate vision and link to performance Business planning Feedback/learning and strategy adjustment
- 12. 11-12 Strategic Matrix Cost and Efficiency Improvements Low internal and low external connectivity Recommend – Use the Internet as a fast, low- cost way to communicate and interact with others Performance Improvement in Effectiveness High internal but low external connectivity Recommend – Increase use intranets and extranets
- 13. Strategic Matrix
- 14. Business model and planning
- 15. Business model
- 17. 11-17 E-Business Strategy Examples Market Creator Channel Reconfiguration Transaction Intermediary Infomediary: Self-Service Innovator Supply Chain Innovator Channel Mastery
- 19. 11-19 Identifying it business strategies Cost and efficiency improvement Performance improvement in business effectiveness Global market presentation Product and service transformation
- 22. 11-22 Implementation Challenges Implementation Do what you planned to do Critical skill for managers Many companies are good at planning Few are good at executing the plan Even if senior management consistently identifies e-business as an area of great opportunity and critical need
- 24. 11-24 End User Resistance and Involvement Change generates resistance Examples: Customer Relationship Management (CRM) Knowledge Management Systems (KM) CRM failures CRM failure rate up to 75 percent Causes for failure Sales force automation problems Unaddressed cultural issues Sales staffs fearful and thus resistant
- 25. 11-25 Obstacles to knowledge management system
- 26. 11-26 Keys to Solving End User Resistance Create relationships Understand the end-user’s situation Provide education and training Require involvement and commitment End-users Top management All stakeholders Eliminate frustration and inconvenience
- 27. 11-27 Change Management Programs Develop a change action plan Assign managers as change sponsors Develop employee change teams Encourage open communications and feedback about organizational changes
- 28. 11-28 Key dimensions of change management
- 29. 11-29 Change Management Tactics Involve as many people as possible in e- business planning and application development Make constant change an expected part of the culture Tell everyone as much as possible about everything, as often as possible, in person Make liberal use of financial incentives and recognition Work within company culture, not around it
Editor's Notes
- Information technology has created a seismic shift in the way companies do business Just knowing the importance and structure of e-business is not enough You must create and implement an action plan that allows you to make the transition from an old business design to a new e-business design
- Gaining in popularity as a less formal, but more realistic, strategic planning methodology Teams of managers and planners participate in microworld or virtual world exercises Business scenarios are created and evaluated Alternative scenarios are then created
- SWOT stands for Strengths: a company’s core competencies and resources Weaknesses: areas of substandard business performance compared to others Opportunities: potential for new business markets or innovative breakthroughs that might expand current markets Threats: anything that has the potential for business and market losses
- The balanced scorecard measures a company’s activities in terms of vision and strategies The business perspectives a scorecard measures Financial: reflects financial performance, such as cash flow or ROI Customer: measures having a direct impact on customers, such as time to process phone calls Business process: reflects the performance of key business processes, such as time spent prospecting or process costs Learning/growth: the company’s learning curve, such as how many hours are spent training staff The system has four processes Translating vision into operational goals Communicating the vision and linking it to individual performance Business planning Feedback/learning and strategy adjustment
- Strategic Matrix Cost and Efficiency Improvements Use the Internet as a fast, low-cost way to communicate and interact with others Use of e-mail, chat systems, discussion groups, and company websites Performance Improvement in Effectiveness Major improvements in business effectiveness recommended Increase use of Internet-based technologies, such as intranets and extranets
- Market Creator Be among the first to market and remain ahead of the competition by continuously innovating Channel Reconfiguration Use the Internet to directly access customers, make sales, and fulfill orders Transaction Intermediary Use the Internet to process purchases Infomediary: Use the Internet to reduce the search cost Offer a unified process for collecting the information needed to make a large purchase Self-Service Innovator Provide a comprehensive suite of services that the customer’s employees can use directly Supply Chain Innovator Use the Internet to streamline supply chain interactions Channel Mastery Use the Internet as a sales and service channel
- Implementation Do what you planned to do Critical skill for managers Many companies plan changes very well Few manage to convert a plan into action This is true even if senior management consistently identifies e-business as an area of great opportunity
- Any new way of doing things generates some resistance from the people affected CRM projects have a history of failure Up to 75 percent of CRM projects fail to meet their objectives This is often due to sales force automation problems and unaddressed cultural issues Sales staffs are often resistant to, or fearful of, using CRM systems
- Understanding the end-user’s situation Education and training End-user involvement in organizational changes and system development Requiring involvement and commitment of top management and all stakeholders Systems that inconvenience or frustrate users cannot be effective, no matter how technically elegant or efficient