1. Chapter 1 IT Supports Organizational Performance in Turbulent Business Environments Information Technology for Management Improving Performance in the Digital Economy 7 th edition John Wiley & Sons, Inc. Slides contributed by Dr. Sandra Reid Chair, Graduate School of Business & Professor, Technology Dallas Baptist University 1-1 Copyright 2010 John Wiley & Sons, Inc.
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6. Figure IT 7eU The Business Performance Management Cycle and IT Model 1- Copyright 2010 John Wiley & Sons, Inc.
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12. Toyota Scion’s Innovative Advertising Strategies (continued) Copyright 2010 John Wiley & Sons, Inc. 1- For the 2008 xB SUV, Scion created a special Web site, want2bsquare.com
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15. Copyright 2010 John Wiley & Sons, Inc. 1- 1.1 Doing Business in the Digital Economy
28. Copyright 2010 John Wiley & Sons, Inc. 1- 1.3 Business Performance Management, Business Pressures, Organizational Responses, and IT Support
29. Figure 1.5 Copyright 2010 John Wiley & Sons, Inc. 1- Business performance management cycle and IT.
30. Figure 1.6 Copyright 2010 John Wiley & Sons, Inc. 1- Business pressures, organizational performance and responses, and IT support.
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32. Companies Going Green – It’s Good Business Copyright 2010 John Wiley & Sons, Inc. 1- http://www.cbsnews.com/stories/2008/11/06/60minutes/main4579229.shtml 60 Minutes ( cbs news magazine) correspondent Scott Pelley and crew got roughed up at a Chinese dump while working on a story on toxic electronic waste. Click the following link & read/watch the story, Following The Trail Of Toxic E-Waste : An E-Waste Story That'll Make You Want To Quit Tech
39. Figure 1.8 Copyright 2010 John Wiley & Sons, Inc. 1- The firm’s value chain. The arrows illustrate the flow of goods & services (the internal part of the supply chain). (Source: Drawn by E. Turban)
44. Information Systems Failures Copyright 2010 John Wiley & Sons, Inc. 1- Nike_Rebounds_How_and_Why_Nike_Recovered_from_Its_Supply_Chain_Disaster Project Management: AT&T Wireless Self-Destructs
45. Copyright 2010 John Wiley & Sons, Inc. 1- 1.5 Social Computing and Networking and Virtual Worlds
51. Minicase : Dartmouth College Goes Wireless 1- Copyright 2010 John Wiley & Sons, Inc. See Dartmouth College Goes Wireless article in InformationWeek
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Notas do Editor
Figure IT 7eU provides early opportunity to discuss overview of IT’s role in corporate strategy setting and its intricate importance to performance as business solutions and the resulting profitability. Compare and contrast the profit and nonprofit sectors; public versus private.
Begin discussion as to how IT has facilitated the explosion of the global economy, marketplace.
PBS documentary is a great tool for discussion of the Gen Y profile & characteristics affecting this group as consumers. According to Wikipedia, the link following, can be a basis for better understanding of how really innovative the advertising strategy used with the Toyota Scion: http://en.wikipedia.org/wiki/Generation_Y
Target marketing focuses on customizing marketing components for groups of customers rather than individuals. Search engine marketing is the concept of using search engines such as Google, Microsoft, Yahoo to analyze “clicks” of where people go to determine their likes and dislikes regarding likely purchases…this is called “pay per click” advertising dollar expenditures. According to Wikipedia - Search engine marketing , or SEM , is a form of Internet marketing that seeks to promote websites by increasing their visibility in search engine result pages (SERPs). According to the Search Engine Marketing Professional Organization , SEM methods include: search engine optimization (or SEO), paid placement , and paid inclusion . [1] Other sources, including the New York Times , define SEM as the practice of buying paid search listings. One-to-one marketing (sometimes expressed as 1:1 marketing ) is a customer relationship management ( CRM ) strategy emphasizing personalized interactions with customers. The personalization of interactions is thought to foster greater customer loyalty and better return on marketing investment. ClickZ article extends understanding of web-based customer involvement used to promote Scion advertising. Ethical questions abound and provide a good source for discussion now.
Web-based technology used to create social environments, or networks, that will provide a sense of community, of wanting to be included in the experience continues to be important to the success of Toyota’s advertising strategies such as used to promote Scion. Secondlife.com generated 10,000 blog posts between April and June 2007; Scion is the third most recognized brand in SecondLife awareness.
Toyota Uses Chat to Promote Scion article for discussion. Click images for homepages. Livechat feature gets hundreds of conversations per week. Conversations provide valuable information for dealers & expansion plans.
Click image for website visit. Visitors to the site can earn points by playing games, watching videos, and emailing others about the site. More of the social network connection to promote customer loyalty at a very early age.
Task students to bring examples from select categories for discussion to expand critical thinking skills.
Depending upon focus planned by faculty, drill down into discussions about some or all of these categories. Each has ethical dilemmas associated with it. Discuss the implications to business overall in each category.
Click Siemens AG hotlink for pdf with more in-depth presentation by corporate representatives. Perhaps discuss executive decision guidelines prior to transforming business to digital enterprise. Wikipedia definition of electronic commerce: Electronic commerce , commonly known as e-commerce or eCommerce , consists of the buying and selling of products or services over electronic systems such as the Internet and other computer networks . The amount of trade conducted electronically has grown extraordinarily since the spread of the Internet. A wide variety of commerce is conducted in this way, spurring and drawing on innovations in electronic funds transfer , supply chain management , Internet marketing , online transaction processing , electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at some point in the transaction's lifecycle, although it can encompass a wider range of technologies such as e-mail as well. A large percentage of electronic commerce is conducted entirely electronically for virtual items such as access to premium content on a website, but most electronic commerce involves the transportation of physical items in some way. Online retailers are sometimes known as e-tailers and online retail is sometimes known as e-tail . Almost all big retailers have electronic commerce presence on the World Wide Web. Electronic commerce that is conducted between businesses is referred to as business-to-business or B2B . B2B can be open to all interested parties (e.g. commodity exchange ) or limited to specific, pre-qualified participants ( private electronic market ). Electronic commerce that is conducted between businesses and consumers, on the other hand, is referred to as business-to-consumer or B2C . This is the type of electronic commerce conducted by companies such as Amazon.com . Electronic commerce is generally considered to be the sales aspect of e-business . It also consists of the exchange of data to facilitate the financing and payment aspects of the business transactions
Refer to Figure 1.1 for discussion opportunities.
Provide opportunity for students to discuss their own examples of Internet, Intranets, & Extranets.
Do students subscribe to such services? If so, why? What are other business opportunities based on similar technologies?
Students may compare & contrast to consider each of processing orders through Internet.
Students should provide example of other customizations done online. Refer back to Toyota’s Scion in the Opening Case.
Discuss dynamic relationships within each. Good opportunity to discuss students’ vision of future trends.
Not every system will include all components.
Discuss the role of IT in strategic direction within organization. How might IT be a competitive advantage? Performing more customer-centric services that are difficult to emulate by others. Strategic plans cannot be implemented in even the smallest organizations without IT. Strategic advantage is not possible with IT infrastructure being properly in place. Effective performance is not possible without it either.
Facilitate discussion of each step & how improved with IT. Organizations must manage their performance rather than just letting it happen.
Environmental factors can impact performance of individuals, departments, & entire organizations. Discuss, for instance, how each level of performance might be impacted by an implementation of an ERP, a “going green” initiative, etc. Better reporting might be possible making real time decision making a reality where before it was not. Green approach may be more cost effective.
Click Pushing Green Technology for video to stimulate further critical thinking and discussion about the benefits of green technology. Examples can be appropriate disposal of obsolete equipment; technology that will not emit dangerous elements into the environment. Efficient utilization by using power save features. Click image for more. Wikipedia definition of Green Computing: Green computing is the study and practice of using computing resources efficiently. The primary objective of such a program is to account for the triple bottom line , an expanded spectrum of values and criteria for measuring organizational (and societal) success. The goals are similar to green chemistry ; reduce the use of hazardous materials, maximize energy efficiency during the product's lifetime, and promote recyclability or biodegradability of defunct products and factory waste. Modern IT systems rely upon a complicated mix of people, networks and hardware; as such, a green computing initiative must be systemic in nature, and address increasingly sophisticated problems. Elements of such as solution may comprise items such as end user satisfaction, management restructuring, regulatory compliance, disposal of electronic waste , telecommuting , virtualization of server resources, energy use , thin client solutions, and return on investment (ROI).
Click the images to go to the homepages to learn more about the respective companies “green” activities. Facilitate discussion about why companies are willing to spend money to be eco-friendly. In the long term it is more cost effective. How can energy-efficient data centers be justified? Reliability, cost, customer satisfaction, employee productivity. Discuss 60 Minutes segment. Click link to access it. InformationWeek article is linked here to stimulate further discussion.
Task students to bring examples beyond what is represented here for further discussion.
Students may pick an article for presentation & discussion regarding the issue of ethics & IT. Wikipedia definition: Ethics of intellectual property, knowledge and skills Knowledge and skills are valuable but not easily "ownable" as objects. Nor is it obvious who has the greater rights to an idea: the company who trained the employee, or the employee themselves? The country in which the plant grew, or the company which discovered and developed the plant's medicinal potential? As a result, attempts to assert ownership and ethical disputes over ownership arise. Patent infringement , copyright infringement , trademark infringement . Misuse of the intellectual property systems to stifle competition: patent misuse , copyright misuse , patent troll , submarine patent . Even the notion of intellectual property itself has been criticised on ethical grounds: see intellectual property . Employee raiding : the practice of attracting key employees away from a competitor to take unfair advantage of the knowledge or skills they may possess. The practice of employing all the most talented people in a specific field, regardless of need, in order to prevent any competitors employing them. Bioprospecting (ethical) and biopiracy (unethical). Business intelligence and industrial espionage . Cases: private versus public interests in the Human Genome Project Business ethics is a form of applied ethics that examines ethical principles and moral or ethical problems that arise in a business environment. In the increasingly conscience-focused marketplaces of the 21st century, the demand for more ethical business processes and actions (known as ethicism ) is increasing. [1] Simultaneously, pressure is applied on industry to improve business ethics through new public initiatives and laws (e.g. higher UK road tax for higher-emission vehicles). [2] Business ethics can be both a normative and a descriptive discipline. As a corporate practice and a career specialization, the field is primarily normative. In academia descriptive approaches are also taken. The range and quantity of business ethical issues reflects the degree to which business is perceived to be at odds with non-economic social values. Historically, interest in business ethics accelerated dramatically during the 1980s and 1990s, both within major corporations and within academia. For example, today most major corporate websites lay emphasis on commitment to promoting non-economic social values under a variety of headings (e.g. ethics codes, social responsibility charters). In some cases, corporations have redefined their core values in the light of business ethical considerations (e.g. BP 's "beyond petroleum" environmental tilt).
Assign students to take an industry…..such as air transportation….and apply Porter’s model within it….take their own company & industry for interesting & relevant discussion.
Click image for YouTube interview with Michael Porter about this model. The model provides opportunity to discuss the impact & importance of IT upon corporate strategy implementation & success.
How are each of these strategies enhanced by IT? Cost can be reduced by increased productivity, expanded operational opportunities.
Facilitate discussion about the importance of activities in each category. Students bring examples from various industries.
Link is to informative YouTube video on this topic. Business intelligence is the ability to convert corporate data into strategies for competitive advantage.
Click image to homepage link. Students should be tasked to review site & bring back practical applications for the technology.
Click images to homepage links. Do you consider these organizations to generally be successful first-movers? When does it makes sense to be a late-adopter in IT? Yes, first-movers as they were leaders; others rushed to follow with wannabe replicas. There can be serious mistakes, costs, associated with first-movers that may not be part of a later entrant strategy. Wikipedia definition: First-mover advantage is the advantage gained by the initial occupant of a market segment. This advantage may stem from the fact that the first entrant can gain control of resources that followers may not be able to match. [1] Sometimes the first mover is not able to capitalize on its advantage, leaving the opportunity for another firm to gain second-mover advantage . There are several advantages that can be gained from entering first: [1] Scarce resources can be preempted, e.g. occupation of prime retail locations The ability to register patents and trademarks that will protect the first entrant from future competition. Changing the economics of the market in a way that second entrants will not have an economic justification to enter. This can cause total failure for second-movers who go to large expenses to capture a limited market. Early profits can be re-invested in improving the resource base. Reputation will likely have the advantages that come from suppliers, distributors and customers who are familiar with and loyal to their products. Second-movers tend to suffer inherently from being labeled "copy cats" and their product reputation may be unfairly questioned by the general public. Nevertheless, there are two obvious drawbacks to being the first mover: cost and risk. Not only is it expensive to be a pioneer - often investing in both R&D and market education, but it is risky, as the first company in a particular market cannot benefit from knowledge of successes and mistakes of others.
Click images to home page links. Discuss why advantages turned to losses. Competition overtook them. Wikipedia suggests possibilities & helpful for discussions: First-mover Disadvantages: (Lieberman and Montgomery, 1988) Free-rider effects Late movers may be able to free-ride on a pioneering firm’s investments in a number of areas including R&D, buyer education and infrastructure development. Imitation costs are lower than innovation costs in most industries. However, innovators enjoy an initial period of monopoly that is not available to imitator firms. Late-mover firms can acquire already trained skillful labor at lower cost Resolution of technological or market uncertainty Entry in an uncertain market obviously involves a high degree of risk. Early entry is more attractive when the firm can influence the way that uncertainty is resolved. For example, the firm may be able to set industry standards in its favor. Firm size may also be important, large firms may be better equipped to wait for resolution of uncertainty or to hedge by maintaining a more flexible investment portfolio. Shifts in technology or customer needs Technological progress as a process of ‘creative destruction’ in which existing products are superseded by the innovations of new firms. New entrants exploit technological discontinuities to displace existing incumbents. Since the replacement technology often appears while the old technology is still growing, it may be difficult for an incumbent to perceive the threat and take adequate preventative steps. Customer needs are also dynamic, creating opportunities for later entrants unless the first-mover firm is alert and able to respond. Incumbent inertia Vulnerability of the first-mover firm is often enhanced by incumbent inertia. Such inertia can have several root causes: the firm may be locked into a specific set of fixed assets. the firm may be reluctant to cannibalize existing product lines. the firm may become organizationally inflexible. All three factors above inhibit the ability of the firm to respond to environmental change or competitive threats. Incumbent monopolist is less likely to innovate than a new entrant, since innovation destroys rents on the firm’s existing products. Under a broad range of conditions the incumbent’s optimal strategy is to develop an improved product but delay market introduction until challenged by the appearance of a rival product. Lieberman, Marvin (Summer 1988.). First-mover advantages, . Strategic Management Journal, Vol. 9.
Click links to respective interesting articles for discussion. Consider similarities & differences.
Web 2.0 is platform for social computing. Social computing has revolutionized business opportunities with the formation of communities for like-interest participants. Ask students to give their own examples of social sites to which they belong, why do they, and often do they use them. Click model for helpful article & discussion topic. According to wikipedia: Web 2.0 encapsulates the idea of the proliferation of interconnectivity and interactivity of web-delivered content. Tim O'Reilly regards Web 2.0 as the way that business embraces the strengths of the web and uses it as a platform. O'Reilly considers that Eric Schmidt's abridged slogan, don't fight the Internet , encompasses the essence of Web 2.0 — building applications and services around the unique features of the Internet, as opposed to expecting the Internet to suit as a platform (effectively "fighting the Internet").
How might organizations use social networks to their advantage? They use them to test acceptance for new products before they are launched. Social Networking Sites often include electronic discussions such as chat rooms. These sites appear on the Internet, within corporate intranets, and on blogs . A blog (Weblog) is an informal, personal journal that is frequently updated and intended for general public reading. The logos represent popular social networking sites. Clicking on the logo will take you to the respective home pages. Social Networks Go to Work is linked to an article recommended to stimulate discussion regarding pervasive presence of social networking in organizations. These sites are very important to the success, and can lead to the failure, of business activities, events, promotions, etc. Word-of-mouth communication, while not easily controlled by organizations, is facilitated greatly through such special interest groups.
Overview of the educational journey for this “semester.”
Dartmouth College technology initiative is the subject of the Minicase at the end of this first chapter. If you click on the respective pictures, it will take you to the university in order to put this decision within the context of their culture for innovation and cutting-edge technological advances. Dartmouth College Goes Wireless provides more insight to the case for discussion. Opportunities exist for discussion of the pros and cons associated with such administrative decisions. Discuss from the business model perspective ie: competitive aspect of business, financial decision, enhancement to educational (product) experience and delivery.