3.1 © 2007 by prentice hall week 03 chapter 03 information systems, organizations, and strategy...

3.1 © 2007 by Prentice Hall

Week 03Week 03

Chapter 03Chapter 03

Information Systems, Information Systems, Organizations, and Organizations, and

StrategyStrategy

Chapter 03Chapter 03

Information Systems, Information Systems, Organizations, and Organizations, and

StrategyStrategy


LEARNING OBJECTIVES

Management Information SystemsManagement Information SystemsChapter 3 Information Systems, Organizations, and StrategyChapter 3 Information Systems, Organizations, and Strategy

• Identify and describe important features of organizations that managers need to know about in order to build and use information systems successfully.

• Evaluate the impact of information systems on organizations.

• Demonstrate how Porter’s competitive forces model and the value chain model help businesses use information systems for competitive advantage.


• Demonstrate how information systems help businesses use synergies, core competencies, and network-based strategies to achieve competitive advantage.

• Assess the challenges posed by strategic information systems and management solutions.

LEARNING OBJECTIVES (Continued)



Will the New US Airways Be Able to Fly?

• Problem: Intense competition and environmental changes.

• Solutions: Revising business processes and integrating them with information systems and culture could increase sales and reduce costs.

• Selecting appropriate systems and technology eliminates redundant systems.

• Demonstrates IT’s role in supporting improved business processes.

• Illustrates the benefits of integrating information systems in the face of interdependence of environment, culture, process, strategy, and systems.



Organizations and Information Systems

• What is an organization?

• Features of organizations

• Routines and business processes

• Organizational politics

• Organizational culture

• Organizational environments

• Organizational structure

• Other organizational features




• Routines and business processes

• Routines = standard operating procedures (rules, procedure, and practices)

• Business processes = collection of business processes

• Organizational politics

• Political struggle for resources, competition and conflict within every organization




• Organizational Culture

• Encompasses the assumptions about what products the organization should produce, how it should produce them, where and for whom.

• Organizational environments

• Organizations reside in environments from which they draw resources and to which they supply goods and services.

• Organizational structures

• Organizations have a structure or shape

• Depends on the size of the organizations



The Two-Way Relationship Between Organizations The Two-Way Relationship Between Organizations and Information Technologyand Information Technology

Figure 3-1

This complex two-way relationship is mediated by many factors, not the least of which are the decisions made—or not made—by managers. Other factors mediating the relationship include the organizational culture, structure, politics, business processes, and environment.




How Information Systems Impact Organizations and Business Firms


• Economic impacts

• Organizational and behavioral impacts

• IT flattens organizations

• Postindustrial organizations

• Understanding organizational resistance to change

• The Internet and organizations

• Implications for the design and understanding of information systems


Flattening OrganizationsFlattening Organizations

Figure 3-8

Information systems can reduce the number of levels in an organization by providing managers with information to supervise larger numbers of workers and by giving lower-level employees more decision-making authority.


How Information Systems Impact Organizations and Business Firms


• Traditional competitors

• New market entrants

• Substitute products and services

• Customers

• Suppliers

Porter’s Competitive Forces Model

Using Information Systems to Achieve Competitive Advantage



Porter’s Competitive Forces ModelPorter’s Competitive Forces Model

Figure 3-10

In Porter’s competitive forces model, the strategic position of the firm and its strategies are determined not only by competition with its traditional direct competitors but also by four forces in the industry’s environment: new market entrants, substitute products, customers, and suppliers.




• Low-cost leadership

• Product differentiation

• Focus on market niche

• Strengthen customer and supplier intimacy

Information systems strategies for dealing with competitive forces



The Internet’s impact on competitive advantage




• Read the Interactive Session: Technology, and then discuss the following questions:

• Why is knowing about the customer so important to a company such as 7-Eleven?

• What are the benefits of 7-Eleven’s Retail Information System?

• In terms of Porter’s model, what strategic forces does the Retail Information System seek to address?

• Which of the strategies described in the chapter does the Retail Information System support?

7-Eleven Stores Ask the Customer by Asking the Data


• Extending the value chain: The value web

The business value chain model



Synergies, core competencies, and network-based strategies

• Synergies• Enhancing core competencies• Network-based strategies

• Network economics• Virtual company strategy• Business ecosystems: Keystone and niche firms




• Read the Interactive Session: Organizations, and then discuss the following questions:

• Analyze Amazon.com using the competitive forces and value chain models. How has it responded to pressures from its competitive environment? How does it provide value to its customers?

• Describe Amazon’s evolving business strategy.

• Why did the company change its strategy?

• Do you think Amazon can continue to be successful? Explain your answer.

Amazon.com: An Internet Giant Fine-Tunes Its Strategy


The Value WebThe Value Web

Figure 3-12

The value web is a networked system that can synchronize the value chains of business partners within an industry to respond rapidly to changes in supply and demand.




• Sustaining competitive advantage

• Performing a strategic systems analysis

• Managing strategic transitions

Using Systems for Competitive Advantage: Management Issues



• Which features of organizations do

managers need to know to build and use IS

successfully ?

• The managers should know all the features: The managers should know all the features:

structures, cultures, politics, environment, structures, cultures, politics, environment,

routine & business processes. routine & business processes.




• What is the impact of IS on organizations?

• The introduction of a new IS will affect The introduction of a new IS will affect

organizational structure, goals, work organizational structure, goals, work

design, values, competition between design, values, competition between

interest groups, decision making and day-interest groups, decision making and day-

to-day behavior.to-day behavior.




• How does Porter’s competitive forces model help

companies develop competitive strategies using

IS?

• IS help companies compete by maintaining low

costs, differentiating products or services, focusing

on market niche, strengthening ties with customers

and suppliers, and increasing barriers to market

entry with high levels of operational excellence.




• How do the value chain and value web models help

businesses identify opportunities for SIS applications?

• A firm’s value chain can be linked to the value chains of

its suppliers, distributors, and customers.

• A value web consists of IS that enhance

competitiveness at the industry level by promoting use

of standards and industry-wide consortia, and by

enabling businesses to work more efficiently with their

value partners.




• How do IS help businesses use synergies, core

competencies, and network-based strategies to achieve

competitive advantage ?

• By promoting the sharing of knowledge across business

units.

• IS also facilitate business models based on large networks of

users or subscribers that take advantage of network

economics.

• IS support a dense network of interactions among the

participating firms.




• What are the challenges posed by SIS and how should they be

addressed ?

• Implementing IS requires extensive organizational change and

a transition from one sociotechnical level to another.

• Such changes are called strategic transitions and are often

difficult and painful to achieve.

• Many SIS are easily copied by other firms so that strategic

advantage is not always sustainable.



3.1 © 2007 by prentice hall week 03 chapter 03 information systems, organizations, and strategy...

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