chapter 11

McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

Chapter 11

Business/IT Strategies for Development

11-2

Learning ObjectivesDiscuss the role of planning in the business use of

information technology, using the scenario approach, and planning for competitive advantage as examples.

Discuss the role of planning and business models in the development of business/IT strategies, architectures, and applications.

Identify several change management solutions for end-user resistance to the implementation of new IT-based business strategies and applications.

11-3

Section 1IT Planning Fundamentals

11-4

I. Introduction

Simply knowing the importance and structure of e-business is not enough. A Plan is needed to transition from an old business design to a new e-business design.

11-5

II. Organizational PlanningEnterprise-wide plans are required to

introduce IT/IS-based solutions to the entire firm.

Strategic Planning – develop a firm’s mission, goals, policies

Tactical Planning – develop objectives, procedures, rules, schedules, budgets

Operational Planning – implement/control day-to-day operations

11-6

III. The Scenario Approach A less rigid but more realistic strategic

planning methodology; combine known facts about the future with plausible alternatives

Knowledge:Trends – Things we think we know

something aboutUncertainties – Elements we consider

uncertain or unknowable

11-7

III. The Scenario Approach

Components of an Organizational Components of an Organizational Planning ProcessPlanning Process

11-8


Strategic Visioning Questions for e-BusinessStrategic Visioning Questions for e-Business

11-9


Converging Trends in Strategic Business/IT Converging Trends in Strategic Business/IT PlanningPlanning

11-10

Risk Assessment and Mitigation

What are the four types of IT risks listed?Describe each risk.What could a firm do to mitigate each risk?

11-11

IV. Planning for Competitive Advantage

Evaluation of potential benefits/risk of using IT for competitive advantage

SWOT ( strengths, weaknesses, opportunities, threats) Analysis – evaluate impact of each possible strategic opportunityStrengths – core competencies and resourcesWeaknesses – areas of substandard performanceOpportunities – potential for new markets or

innovationThreats – potential for losses

11-12

Bristow Helicopters: Technology-Supported SWOT and Much More

What needs did Bristow have?What key goal is identified?What software technology was used to make

these changes?How did the software work to accomplish this?

11-13

V. Business Models and Planning

Conceptual framework of how a business can deliver value to customers at a cost and still turn a profit

11-14

V. Business Models and Planning Questions for All Business ModelsQuestions for All Business Models

11-15

V. Business Models and Planning Questions for e-Business ModelsQuestions for e-Business Models

11-16

Iridium Satellite: Finding the Right Business Model

What product/market did Iridium originally service?

What product/market have they moved to?Why is this different from the way they

previously competed?

11-17

VI. Business/IT Architecture Planning

Plans on how to use IT to support customer value and business value goals

Strategic Development – business strategies that support a firm’s business vision

Resource Management – strategic plans for managing or outsourcing a firm’s IT resources

Technology Architecture – strategic IT choices reflecting an IT architecture that supports a firm’s e-business and other IT initiatives

11-18


Information Technology Architecture – blueprint that contains:

Technology Platform – complete infrastructure supporting strategic use of IT for e-commerce and business/IT applications

Data Resources – databases and data warehouses

Application Architecture – business applications

IT Organization – organizational structure of the IS function within a firm

11-19


Balanced Scorecard – measuring a company’s activities in terms of its visions and strategies; not based on proven economic theory or decision sciences

Financial Perspectives – measures of financial performance

Customer Perspective – measures directly impacting customers

Business Process Perspective – measures performance of key business processes

Learning and Growth Perspective – measures the firm’s learning curve

11-20

VII. Identifying Business/IT Strategies To optimize strategic impact, firms must

continually assess the value of IT/e-commerce applications

Cost and Efficiency Improvements – low internal/external connectivity and low use of IT

Performance Improvement in Business Effectiveness – high internal but low external connectivity, need to improve collaboration

Global Market Penetration – high external connectivity and use of IT

Product and Service Transformation – extensively networked internally and externally

11-21

e-Business Strategy Examples

Describe each example listed.Discuss each example and how it could

be used in a particular business.Identify businesses (not those listed)

that could utilize each example.

11-22

VIII. Business Application Planning IT proposals for addressing strategic

business priorities and planning for application development

Business/IT Architecture Planning – combines strategic planning methods (SWOT, etc.) with recent modeling and development methodologies

11-23

VIII. Business Application Planning

E-Business Architecture PlanningE-Business Architecture Planning

11-24

KI: The Importance of Strategic Planning

Why is forming a strategic IT plan difficult at most companies?

What was the problem at KI?How has developing a strategic IT plan helped

the firm overall?What pitfalls, resistance, and cultural issues

might have been stumbling blocks along the way?

11-25

The Role of IT in Business Process Design

Why might IT personnel be in a better position to see organizational needs than other personnel?

Why would IT be in the right place to provide solutions to these needs?

What organizational and cultural issues might be stumbling blocks to adopting these solutions?

11-26

Section 2Implementation Challenges

11-27

I. Implementation

Carrying out the strategic plans developed in the planning process

11-28

II. Implementing Information Technology

Moving to e-business involves major organizational change

11-29

II. Implementing Information Technology

Impact and Scope of Business Change Impact and Scope of Business Change Caused By IT ImplementationCaused By IT Implementation

11-30

III. End-User Resistance and Involvement

New ways of doing things always generates some resistance from those affected; end-user involvement in the change process can help minimize the resistance

11-31

III. End-User Resistance and Involvement

Obstacles to Knowledge Management Obstacles to Knowledge Management SystemsSystems

11-32

Société de Transport de Montréal: Smooth Ride after a Bumpy Start

What problem did STM have?Why did this problem occur?How did the IT staff work to resolve this

problem?What other issues/areas might this same

problem arise within? Why would the same problem manifest

itself in other ares?

11-33

Understanding the Science Behind Change

What was the problem in IT at Blue Cross?

What causes these problems?How does understanding the problem

help?How did Blue Cross address the

problem?

11-34

IV. Change Management

Managing organizational change is important and can be difficult; people are a major focus here

A Change Management Process – these 8 steps are just one way of visioning change management

11-35

IV. Change Management

Key Dimensions of Change ManagementKey Dimensions of Change Management

11-36

DHL Express: The Challenges of Global Change

What are the two extremes of the pendulum for IT?

What as the problem at DHL?What solution did DHL provide for this

problem?How does this affect the IT department?How does it affect DHL?

11-37

Reuters: Implementing Global Shared Services

What problem did Reuters have, and why?

What solution did they adopt?Discuss the meaning of this solution.How did this work out for Reuters?

chapter 11

Documents