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IT in Business

IT in Business. Lecture 1. Introduction. IT for Business Our Introduction Biggest achievement so far Expectations from this course. Information Technology in Businesses. The Information Technology. What is the role of Information Technology in today’s competitive business environment?

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IT in Business

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  1. IT in Business Lecture 1

  2. Introduction IT for Business • Our Introduction • Biggest achievement so far • Expectations from this course

  3. Information Technology in Businesses

  4. The Information Technology • What is the role of Information Technology in today’s competitive business environment? • What exactly is an Information Technology? What do managers need to know about information systems? • How is Information Technology transforming organizations and management?

  5. The Information Technology • How has the Internet and Internet technology transformed business? • What are the major management challenges to building and using information systems?

  6. The Challenges 1. Design competitive and effective IT systems 2. Understand system requirements of global business environment 3. Create information architecture that supports organization’s goal

  7. The Challenges 4. Determine business value of information systems 5. Design systems people can control, understand and use in a socially, ethically responsible manner

  8. Why Information Technology? There are Four reasons why IT will impact you in your career: • Capital Management. • Foundation of doing business. • Productivity. • Strategic opportunity and advance.

  9. Why Information Technology? Five powerful worldwide changes that have altered the business environment: • Internet growth and technology convergence. • Transformation of Business Economy • Emergence of the Global Economy. • Growth of knowledge and information based economies. • The Emerging Digital Firm.

  10. The Internet and Technology The Internet and Technology convergence • Convergence of communication platforms. • Emergence of new markets and services. • Requirements of partners. • E-Commerce. • Adding value to the services offered by the Government.

  11. Transformation of Businesses Transformation of the Business Enterprise • Flattening • Decentralization • Flexibility • Location independence • Low transaction and coordination costs • Empowerment • Collaborative work and teamwork

  12. Emergence of Digital Firm Emergence of the Digital Firm • Digitally-enabled relationships with customers, suppliers, and employees • Core business processes accomplished via digital networks • Digital management of key corporate assets • Rapid sensing and responding to environmental changes

  13. Information Systems? A set of interrelated components that collect (or retrieve), process, store, and distribute information to support decision making and control in an organization

  14. Information Systems? • Data: Streams of raw facts representing events such as business transactions • Information: Clusters of facts that are meaningful and useful to human beings in the processes such as making decisions

  15. Data and Information Information Systems?

  16. FEEDBACK Activities in Information System INPUT PROCESS OUTPUT

  17. Functions of Information System

  18. Computerized Information System • Rely on computer hardware and software • Processing and disseminating information

  19. Formal Systems • Fixed definitions of data, procedures • Collecting, storing, processing, disseminating, using data

  20. Business Perspective • An organizational and management solution based on information technology to a challenge posed by the environment • An important instrument for creating value for the organization • Stages in the business information value chain add value to information

  21. Business Perspective Business Processes Supply Enterprise Customer Knowledge Chain Management Management Management Firm Management Profitability and Strategic Position Data Transformation Dissemination Collection Into and Business Storage Systems Planning Coordinating Controlling Modeling and Decision Making Information Processing Activities Management Activities Business Value

  22. TECHNOLOGY ORGANIZATIONS INFORMATION SYSTEMS MANAGEMENT Information System

  23. Computerized Information System • Sales and marketing • Manufacturing • Finance • Accounting • Human resources Major Business Functions

  24. Organizations Key Elements: • People: Managers, knowledge workers, data workers, production or service workers • Structure: Organization chart , groups of specialists, products, geography

  25. Organizations • Operating procedures: Standard operating procedures (SOP, rules for action) • Politics: Power to persuade, get things done • Culture: Customs of behavior

  26. Management Levels: • Senior managers: make long-range strategic decisions about products and services • Middle managers: Carry out the programs and plans of senior management • Operational managers: monitor the firm’s daily activities

  27. Computer Technology Tools managers use to cope with change • Hardware: Physical equipment • Software: Detailed preprogrammed instructions • Storage: Physical media for storing data and the software

  28. Computer Technology • Communications Technology: transfers data from one physical location to another • Networks: link computers to share data or resources

  29. Technical Approaches Computer Operations Science Research Management Sociology Science Psychology Economics Behavioral Approaches Approaches to IT

  30. Socio-Technical Systems Optimize systems performance: • Technology and organization • Organizations mutually adjust to one another until fit is satisfactory

  31. SOURCE: Liker, et al, 1987 Socio-Technical Systems

  32. IT and Organizations

  33. Widening Scope of IT • 1950s: Technical changes • 1960s-70s: Managerial controls • 1980s-90s: Institutional core activities • Today: Digital information webs extending beyond the enterprise

  34. Widening Scope of IT

  35. Internet • International network of networks • Universal technology platform: Any computer can communicate with any other computer • World Wide Web and Web sites

  36. What can be done on Internet? • Communicate and collaborate • Access information • Participate in discussions • Supply information • Find entertainment • Exchange business transactions

  37. New Options for Business • Flattening organizations • Separating work from location • Reorganizing work-flows • Increasing flexibility • Redefining organizational boundaries

  38. Flattening Businesses Flattening Organizations & Information Systems

  39. Process Reengineering

  40. Digital Businesses and Firms • Electronic commerce • Electronic business • Digital market: Information systems links, buyers and sellers to exchange information, products, services, payments

  41. THE EMERGING DIGITAL FIRM ELECTRONIC BUSINESS Electronic Commerce Factories • Just-in-time production • Continuous inventory replenishment Customers • Production planning • On-line marketing • On-line sales • Built-to-order products • Customer service • Sales force automation Remote offices and work groups • Communicate plans and policies • Group collaboration • Electronic communication • Scheduling Suppliers • Procurement • Supply chain management Business partners • Joint design • Outsourcing IT in Businesses

  42. Electronic Commerce • Internet links buyers, sellers • Lower transaction costs • Goods and services advertised, bought, exchanged worldwide • Business-to-business transactions increasing

  43. Electronic Commerce • Electronic Business: Executing all the firm’s business processes with Internet technology • Intranet: Business builds private, secure network based on Internet technology • Extranet: Extension of intranet to authorized external users

  44. IT Infrastructure Information Architecture and Information Technology Infrastructure

  45. Challenges in IT IS • The IT investment challenge-How may a firm obtain the maximum from its’ IT investment? • The strategic business challenge -What contemporary assets are needed to use IT effectively? • The globalization challenge-How can firms understand the business & system requirements of a global economic environment? • The IT infrastructure challenge-How can organizations develop an IT infrastructure that can support their goals when business conditions and technologies are changing so rapidly? • Ethics & security-the responsibility & control challenge: How can organizations ensure that their information systems are used in an ethically and socially responsible manner? The Challenge of Information Systems-key management issues:

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