Post on 20-Jan-2018
description
Effective use of IS/IT
Dr. V.T. RajaOregon State University
Chapter 13 - Outline
• Business value added when using IS/IT:– to automate existing business processes– for organizational learning and change in addition to
automation– BPR; Competitive Advantage; As a strategic enabler
• Effect of IS/IT on Competition– Porter’s competitive forces model
• Value Chain and IS/IT – Internal/External linkages facilitated by IS/IT
• Strategic Information Systems
Class Participation Exercise
• Examples– IBM Credit Corporation– Retail Store – Diaper Sales– Ford Motor Company– Flower Shop
Business Process Reengineering (BPR)
• BPR - Radical redesign of business process(es):– To achieve dramatic improvements in measures of
performance such as quality, cost, speed, and services– To gain competitive advantage or support/change
business strategy. • IT/IS facilitates BPR
– Examples• IBM Credit Corporation• Ford • Flower shop
BPR - Characteristics
• Advantages– Cycle time reduction– Effective communication– Restructuring organization
• Single point of contact for customer• Hierarchical – Flattened – Networked
organizations
BPR - Characteristics
• Disadvantages– Laying off employees
• Voluntary retirement– Retraining employees
• Retraining costs– Transfer of employees
Some Characteristics of a Virtual Organizations
• An organization composed of several business partners sharing costs and resources for the purpose of producing a product or service
• Each partner creates a portion of a product or service in an area in which they have special advantage such as expertise or low cost
• Example: Flower shop and its business partners
Example - Virtual Organization (VO)
Customer
VO - Flower Company
Flower Supplier
Amex/VISAMaster Card
FedEx
1. Places Order - Web
Sends monthly bill
2. E - validates payment3. Passes
e- order5. Accepts Order
4. E-acceptance Order
6. Sends pick up info electronically
7. Picks up order
8. Delivers flowers
Makes e-payment
Makes e-payment
Makes e-payment
Some Characteristics of a Virtual Organization
• Excellence - All star winning team• Resource Utilization - Competitive advantage• Opportunism – Making use of market opportunities• Lack of borders - Redefines traditional boundaries• Adaptability – to change• Trust - Essential between/among business partners• Technology - Basic ingredient
Resources of business partners remain in their original locations but are integrated via information systems.