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Success or Failure Factors of IS

 flexibility culture. Success or Failure Factors of IS. Succeed. Continuous. Service speed quality innovation. or. Business. Improve. Change Management. Survive. Radical. Technology. Organization. Management. culture. (Behavior). (Human). (Strategic Advantage). Structure

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Success or Failure Factors of IS

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  1. flexibility culture Success or Failure Factors of IS Succeed Continuous Service speed quality innovation or Business Improve Change Management Survive Radical Technology Organization Management culture (Behavior) (Human) (Strategic Advantage) • Structure • attribute • decision-making • operation • Ethically Acceptable • Socially Responsible • Politically control uncertainty Risks Benefit overcome enhance strategy I S A Digital Society Ability & flexibility to compress time and space and to expand organizational knowledge and then increase 1) choosing strategy 2) organizing the business 3) organizing the systems management area The Driver & Servant HUMAN ADAPTABILITY [ organizational change] ------Radical Change

  2. Efficiency Effectiveness Innovation (Automate) (Informate) (Innovate) [Doing the things right] [Doing the right things] - creativity -Proper utilization of resource -Attainment of goals - property of culture {Make Money} {Save Money} Success or Failure Factors of IS (Cont’d) [ organizational change] ------Radical Change Evolution of change A FIRM/ORGANIZATION: Restructuring Competitive Advantage Re-engineering Cooperative Advantage Electronic Market: flatten the organizational hierarchical structure “ Revolutionary significance lies in generality” e.g., steam engineers--triggered the first Industrial Revolution Computers--Seem to be triggering a second one.

  3. IT Yesterday, Today and Tomorrow Today Information age People proc. Communication Perspective Information Effectiveness “doing the right things” Tomorrow Knowledge age Knowledge proc. Connectivity Reality Innovation Performance/ Innovation “creativity” Yesterday Computer age Computer proc. Computing Accuracy Automation Efficiency “doing things right”

  4. Three Necessary Perspectives • Business Environment • Enterprises Environment • IT Environment Business Success

  5. Simultaneous Revolutions New Competitors New Rules of Competition The Business New Political Agendas Industry structure Changes New Technology New regulatory Environment New Employees and New Value Increasing Customer Expectation

  6. Business Drivers Market Technology Regulation Organization Employees/ Work Business Processes Solution to Business Requirements

  7. A Systematic Approach Vision Strategy Tactics Business Plan • Competitive Options • Roles, Roles and Relationships • Redefine/ Define • Telecommunications as the Delivery Vehicle • Success Factor Profile

  8. Justification/ Purpose Primary Target Organizational Productivity/ Efficiency Individual Effectiveness Business Process Competitive Advantage The Information Technology Environment Administrative Framework ERA I Data Processing Regulated Monopoly ERA II End-User Computing Free Market ERA III Strategic Systems Regulated Free Market

  9. Competitiveness: A Link to National Goals Human Resources Trade Policy Decreased Budget Deficit Stronger National Security Capital Improved Domestic Performance Increased Competitiveness in World Market More and Better Jobs Technology New Competition Reduced Trade Deficit Increased Standard of Living

  10. The Diamond of National Advantage Chance Firm Strategic, Structure and Rivalry Factor Conditions Demand Conditions Related and Supporting Industries Government

  11. NEW MARKET ENTRANTS SUBSTITUTE PRODUCTS & SERVICES TRADITIONAL COMPETITORS THEFIRM SUPPLIERS CUSTOMERS Figure 3-1: FIVE COMPETITIVE FORCES MODEL Threats Bargaining power N

  12. Port Competitive Model Figure 3-1 Potential New Entrants Intraindustry Rivalry Strategic Business Unit Bargaining Power of Supplier Bargaining Power of Buyers Substitute Products and Services

  13. Wal-Mart and the Porter Competitive Model Figure 3-2 Potential New Entrants • Foreign General Merchandisers or Discounts • Established Retailer Shifting Strategy to Discounting or Megastores Intraindustry Rivalry Strategic Business Unit SBU: Wal-Mart Rivals:Kmart, Target, Toys R Us, Specialty Stores Bargaining Power of Supplier Bargaining Power of Buyers • U.S. Product Manufacture • Foreign Manufacture • Local Government • IT Product and Service Suppliers • Consumers in Small Town, U.S.A • Consumers in Metropolitan Areas in the U.S. • Canadian and Mexican consumers • Other Foreign Consumers Substitute Products and Services • Mail Order • Home Shopping Network • Electronic • Telemarketing • Buying Clubs • Door-to-door Sales

  14. NEW MARKET ENTRANTS SUBSTITUTE PRODUCTS & SERVICES TRADITIONAL COMPETITORS THE FIRM SUPPLIERS CUSTOMERS FIVE COMPETITIVE FORCES MODEL Threats Bargaining power N

  15. Operations Outbound Logistics Marketing and Sales Services Activities of Value Chain Support Activities Administrative and Other Indirect Value Added Inbound Logistics Primary Activities

  16. Competitive (Value) Advantage The Value Chain

  17. Production and Manufacturing Sales and Distributiion Engineering Marketing Service Manufacturing Industry Value Chain Product and Service Flow Figure 3-5 Research and Development Administrative and Other Indirect Value Added

  18. Examples of the Value Chain N TM -18 Dr. Chen,The Trends of the Information Systems Technology

  19. Financial Policy Accounting Regulatory Compliance Legal Claims Training Actuary Training Actuary Training • Product Development • Market Research Claims Training • Actuarial Methods • Investment Practice IT Communication • Claims Settlement • Loss Control • Policy Rating • Underwriting • Investment • Policy Sales • Policy Renewal • Agent Management • Advertising • Independent Agent Network • Billing and Collections Inbound Logistics Operations Outbound Logistics Marketing and Sales Service Generic Value Chain Figure 3-7 Firm Infrastructure Human Resource Management Technology Development Procurement

  20. Generic Value Chain Figure 3-8 Firm Infrastructure Information Systems TechnologyPlanning and Budgeting TechnologyOffice Technology Human Resource Management Training TechnologyMotivation Technology Information Technology Technology Development Product TechnologyComputer-AidedTechnologyPilot PlantTechnology Software Development Tools Information Systems Technology Procurement Information System TechnologyCommunication Technology Transportation System Technology • Basic Technology • Materials Handling • Machine Tool Technology • Material Handling Technology • Packaging Technology • Information Technology • Transportation Technology • Material Handling • Storage and Preservation Technology • Communication System Technology • Information Technology • Transportation Technology • Material Handling Technology • Packaging Technology • Communication System Technology • Information Technology • Multimedia Technology • Communication System Technology • Information Technology • Diagnostic and Testing • Communication System Technology • Information Technology Inbound Logistics Operations Outbound Logistics Marketing and Sales Service

  21. Porter’s Competitive Model Figure 4-2 Potential New Entrants • Aircraft Manufactures Aircraft • Leasing Companies • Labor Unions • Food Service Companies • Airport • Local Transportation Service • FAA (Air Traffic Controllers0 • Hotels • Foreign Carriers • Regional Carrier Start-ups • Cargo Carrier Business Strategy Change Intraindustry Rivalry SBU: American Airlines Rivals: United, Delta, USAir Northwest, Southwest Bargaining Power of Supplier Bargaining Power of Buyers • Travel Agents • Business Travelers • Pleasure Travels • Charter Service • U.S. Military • Cargo and Mail • Alternate Travel Services • Fast Trains • Boats • Private Transportation • Videoconferencing Substitute Products and Services

  22. Generic Value Chain Figure 4-3 Financial Policy Regulatory Compliance Community Affairs Firm Infrastructure Accounting Legal Human Resource Management Flight, Route and Yield Analyst Training Pilot Training Safety Training Baggage Handling Training Inflight Training Agent Training Computer Reservation System, Inflight System Flight Scheduling System, Yield Management System Technology Development Product Development Market Research Baggage Tracking System Procurement Information Technology Communication • Route Selection • Passenger Service System • Yield Management System(Pricing) • Fuel • Flight Scheduling • Crew Scheduling • Facilities Planning • Aircraft Acquisition • Ticket Counter Operation • Gate Operation • Aircraft Operations • Onbord Service • Baggage Handling • Ticket Offices • Baggage System • Flight Connection • Rental Car an d Hotel Reservation System • Lost Baggage Service • Complaint Follow-up • Promotion • Advertising • Advantage Program • Travel Agent Programs • Group Sales Marketing and Sales Operations Service Inbound Logistics Outbound Logistics

  23. Interorganizational Systems Figure 5-1 Customers Vendors Your Company Support Services Business Partners Industry Forces Government Association Info Sources Competitors

  24. Payment Process Industry Figure 5-2 Merchants Member Banks Visa International or Mastercard • Card Holders • Individuals • Businesses

  25. EDI Applications Figure 5-3 Purchase Orders Advance Shipping Notices Electronic Data Interchange Invoices Freight Bills Inventory/ Sales Data

  26. EDI System Obstacles Figure 5-4 Company data versus standards Cross-industry standards Standards administration Data Time zones and windows Communication protocols Telecommunications equipment Service cost and balance Communication Integration Features and function supported Interface Application

  27. Electronic Data Interchange (EDI)Through the Use of a Van Figure 5-5 Electronic Mailbox Vendor Systems: Mainframes • Customer order • Time Schedule • Time Zone • Data Format • Communication • Protocols • Data Transmission • Speed Minicomputers Microprocessors No Computer Conversion/Translation

  28. Values Beliefs Principles Figure 5 --extra Mission Goals Culture Vision Strategies Tactics Authority and Responsibility Objectives and Measurements Business Plan

  29. The Vision -to-Action Process Implementation (Action) Agreement and Commitment Tactics and Business Plan Strategy Feedback Vision Sensing Opportunity

  30. Pyramid of Excellence Stakeholder Value Figure 6-4Reprint with permission of Whirlpool Corporate Where Vision Way Value Value -Creating Objectives What People commitment Total Quality Customer Satisfaction Growth & Innovation Worldwide Excellence System How Strategic Planning Leadership Whirlpool People Fact-Based Management Customer Satisfaction Quality Process & Products Measurement & Results

  31. Vision and Information Systems Figure 6-6 Vision Invest Save Money Asset Application Networks Expense Strategic Tools Tactical

  32. The Three Components of a New Strategy Vision External Assessment Internal Assessment A New Strategy Figure 7-1

  33. Environmental Analysis Company Analysis General Environment Structure Opportunities Value/ Culture Operating Environment Threats Competitive Positioning Competitive Positioning Resources Directions for Development Stakeholder Analysis Vision & Strategy Strategic Management Process Company Vision Company Strategic History Current Strategy Chosen Strategy Realized Strategy Strengths Weaknesses Figure 7-2

  34. Strategy Implementation Senior Management Business Uncertainties Vision and Macro- Strategies Empowered Implementors Company Culture Micro- Strategies and Tactics Risks to be Avoided Critical Performance Factors Key Enterprise Business Processes Figure 7-3

  35. Managing for Results • Objectives • Authority • Responsibility • Training • Motivation • Performance • Results • Reward Control Figure 7-4

  36. Management Information Needs Senior Management Emerging Opportunities and Threats External Impact of Strategies and Tactics Internal Impact of Strategies and Tactics Performance Measurements Enpowered Implementors Figure 7-5

  37. IT-Based Strategies Marketplace Operation Significant Structure Change Federal Express USA Today Charts Schwab Whirlpool Xerox Traditional Products and Processes USAA L.L.Bean McKesson Banc One Boeing Frito-Lay Wal-Mart Figure 7-6

  38. Company Infrastructure • Data Management • User Applications • Voice Management • Network Management • Planning Process • Financial Strategy • Organization Figure 7-7

  39. Target Supplier Customer Competitor Thrust Differentiation Cost Innovation Growth Alliance Mode Offensive Use Defensive Provide Direction Execution Strategy Option Generator Strategic Advantage Figure 8-1

  40. Use Provide Strategy Option Generator Target Supplier Customer Competitor Thrust Differentiation Innovation Growth Alliance Cost Mode Offensive Defensive Direction Execution Strategic Advantage Figure 8-2

  41. Roles, Roles and Relationships Senior Management Users Informational Systems Organization Functional Management Figure 9-1

  42. Using IS to Compete Senior Management IT Leadership Users Business Leadership Information Systems Organization Figure 9-2

  43. Technology Transfer Through Organizational Learning Information Technology Applications Organization Figure 9-3

  44. Using IS to Compete: Primary Responsibilities Specific Approach Direction Conceptual Approach Senior Management 7 2 1 Functional Management 2 5 4 IS Management 1 3 5 10 10 10 Figure 9-4

  45. Making It Happen! Business Leadership Technology Leadership Competitive Vision Tactics Strategy Crisis Management Process Improvement Action Initiators Executive Power Figure 9-5

  46. Board of Directors A Business Products/Services Customers Suppliers Competitors Figure 9-6

  47. Board of Directors Information Systems Organization Customers Suppliers Competitors Figure 9-7

  48. Needs and Priorities Steering Committee Opportunities Direction Wants & Needs Justification Real Dollars? IT Needs Real Dollars Information Systems Organization Users Suppliers Products People Products & Services Constraints Costs Real Dollars Competitors Figure 9-8

  49. Value to Customer Chart Product/Service Value-Added Process What the Customer Buys Delivery Process Product/ Service Value to Customer Figure 10-1

  50. Value to Customer AnalysisCharles Schwab & Co. Product/Service • Computer-based Trades • Client-broker Service • Street Smart • Telebroker • Equalizer • OneSource • Electronic Transfers • Trade Risk Analysis • Stock, Bond and • Mutual Fund Trades • Financial Product Options • Competetive Fees • Timely Execution of • Trades and Money • Transfer • Personal Service • Confidence in Financial • Custodial Responsibilty Delivery Process Product/ Service Value-Added Process What the Customer Buys Value to Customer Figure 10-2

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