chapter 11 it support of organizational performance

Chapter 1Chapter 1 11

Chapter 1Chapter 1

IT Support of Organizational Performance


Learning ObjectivesLearning Objectives

Describe the digital economy and digital Describe the digital economy and digital enterprisesenterprises

Recognize the relationship between Recognize the relationship between performance, organizational pressures, and performance, organizational pressures, and responses and technologyresponses and technology

Define IS and ITDefine IS and IT

Understand what the adaptive enterprise isUnderstand what the adaptive enterprise is


Learning Objectives (Continued)Learning Objectives (Continued)

Understand the support role that IS and IT play Understand the support role that IS and IT play in the organizationin the organization

Understand the importance of learning about ITUnderstand the importance of learning about IT


Digital Economy –Digital Economy – “New” Economy“New” Economy

E-Business:E-Business: The use of electronic technologies to The use of electronic technologies to transact businesstransact business

Collaboration:Collaboration: People and Organizations interact, People and Organizations interact, communicate, collaborate, and search for informationcommunicate, collaborate, and search for information

Information Exchange:Information Exchange: Storing, processing and Storing, processing and transmission of informationtransmission of information


Digital BusinessDigital Business


The Old Economy –The Old Economy – Taking Photo’sTaking Photo’s

1.1. Buy film in a storeBuy film in a store

2.2. Load your cameraLoad your camera

3.3. Take picturesTake pictures

4.4. Take roll of film to store for processingTake roll of film to store for processing

5.5. Pickup the film when readyPickup the film when ready

6.6. Select specific photos for enlargementSelect specific photos for enlargement

7.7. Mail to family and friendsMail to family and friends


The New EconomyThe New Economy – – Taking Photo’sTaking Photo’s

11stst Generation Digital Photography Generation Digital Photography Old economy (except 6 and 7) were replaced by Old economy (except 6 and 7) were replaced by

using a scanner and emailingusing a scanner and emailing

22ndnd Generation Digital Photography Generation Digital Photography Use a Digital Camera, no film, no processingUse a Digital Camera, no film, no processing

33rdrd Generation Digital Photography Generation Digital Photography Your Digital Camera is now in your mobile phone, Your Digital Camera is now in your mobile phone,

your binoculars, or palmtop computer.your binoculars, or palmtop computer.


Business ModelsBusiness Models

A A business modelbusiness model is a method of doing business by is a method of doing business by which a company can generate revenue to sustain itself. which a company can generate revenue to sustain itself. The model spells out how the company adds value to The model spells out how the company adds value to create a product or service. (create a product or service. (Value ChainValue Chain))

Nokia makes and sells cell phonesNokia makes and sells cell phones A TV station provides free broadcasting. Its survival depends A TV station provides free broadcasting. Its survival depends

on a complex model involving advertisers and content on a complex model involving advertisers and content providersproviders

Internet portals, such as Yahoo, also use a complex Internet portals, such as Yahoo, also use a complex business model.business model.


Digital Age Business ModelsDigital Age Business Models

Name-Your-Own PriceName-Your-Own Price

Reverse AuctionsReverse Auctions

Affiliate MarketingAffiliate Marketing

E-Marketplaces and ExchangesE-Marketplaces and Exchanges

Electronic aggregation (buying groups)Electronic aggregation (buying groups)


Drivers Forcing Changes In Drivers Forcing Changes In Business ModelsBusiness Models

Environmental, organizational, and technological Environmental, organizational, and technological factorsfactors

React frequently and quickly to both the React frequently and quickly to both the threatsthreats and the and the opportunities opportunities resulting from this new resulting from this new business environmentbusiness environment

A response can be a reaction to a pressure A response can be a reaction to a pressure already in existence, an initiative intended to already in existence, an initiative intended to defend an organization against future pressures, defend an organization against future pressures, or an activity that exploits an opportunity created or an activity that exploits an opportunity created by changing conditionsby changing conditions

Business Pressures

Business Critical Response Activities


The Drivers of Change The Drivers of Change ((Continued)Continued)


Business Pressures, Business Pressures, Organizational Responses, and Organizational Responses, and

IT SupportIT Support Business PressureBusiness Pressure - The business environment is the - The business environment is the combination of social, legal, economic, physical, and combination of social, legal, economic, physical, and political factors that affect business activitiespolitical factors that affect business activities

Significant changes in any of these factors are likely to Significant changes in any of these factors are likely to create business pressure on the organizationcreate business pressure on the organization

The three types of business pressures faced are: The three types of business pressures faced are: marketmarket, , technologytechnology, and , and societal pressuressocietal pressures..


Three Types of Business Three Types of Business PressuresPressures

Market PressuresMarket Pressures: :

The Global Economy and Strong CompetitionThe Global Economy and Strong Competition

The Changing Nature of the WorkforceThe Changing Nature of the Workforce

Powerful CustomersPowerful Customers


Business Pressures Business Pressures (Continued)(Continued)

Technology PressuresTechnology Pressures::

Technological Innovation and ObsolescenceTechnological Innovation and Obsolescence

Information OverloadInformation Overload



Societal PressuresSocietal Pressures: :

Social Responsibility Social Responsibility

Government Regulation and Deregulation Government Regulation and Deregulation

Protection Against Terrorist AttacksProtection Against Terrorist Attacks

Ethical IssuesEthical Issues


Organizational ResponsesOrganizational Responses

Strategic Systems:Strategic Systems: enable organizations to increase enable organizations to increase market share and/or profits.market share and/or profits.

Customer FocusCustomer Focus enable organizations to provide enable organizations to provide superb customer service and prevent losing customers superb customer service and prevent losing customers to competitors.to competitors.


Organizational Responses Organizational Responses (Continued)(Continued)

Make-to-OrderMake-to-Order is a strategy of producing customized is a strategy of producing customized products and servicesproducts and services

Mass CustomizationMass Customization is producing a large quantity of is producing a large quantity of items, but customizing them to fit the desire of each items, but customizing them to fit the desire of each customercustomer

E-businessE-business and and E-commerceE-commerce is the strategy of doing is the strategy of doing business electronicallybusiness electronically


Why Study Information Why Study Information Systems?Systems?

You will be more effective in your chosen career if you You will be more effective in your chosen career if you understand how successful information systems are built, understand how successful information systems are built, used, and managedused, and managed

You also will be more effective if you know how to You also will be more effective if you know how to recognize and avoid unsuccessful systems and failuresrecognize and avoid unsuccessful systems and failures

According to the US Bureau of Labor Statistics, the “top According to the US Bureau of Labor Statistics, the “top seven fastest growing occupations fall within IT or seven fastest growing occupations fall within IT or computer related field”computer related field”

Developing “Computer” Literacy will only enhance your Developing “Computer” Literacy will only enhance your “Information” Literacy“Information” Literacy


Doing Business in the Digital Doing Business in the Digital EconomyEconomy

The The digital economydigital economy is an economy based on digital is an economy based on digital technologies, including communication networks (the technologies, including communication networks (the Internet, intranets, and extranets), computers, software, Internet, intranets, and extranets), computers, software, and other related technologiesand other related technologies

Also called the Also called the Internet economyInternet economy, the , the new economynew economy, or , or the the Web economyWeb economy

Digital infrastructures provide a Digital infrastructures provide a global platformglobal platform over over which people and organizations interact, communicate, which people and organizations interact, communicate, collaborate, and search for information.collaborate, and search for information.


The Global Platform of the New The Global Platform of the New EconomyEconomy

A huge number of digitizable products; that is products A huge number of digitizable products; that is products that can be converted to digital format. Most common that can be converted to digital format. Most common are: books, movies, magazines, TV and radio are: books, movies, magazines, TV and radio programming, electronic games, music CDs, and programming, electronic games, music CDs, and computer software.computer software.

Consumers and firm conducting financial transaction Consumers and firm conducting financial transaction digitally.digitally.

Physical goods such as home appliances and Physical goods such as home appliances and automobiles that contain embedded computer chips and automobiles that contain embedded computer chips and connectivity capabilities.connectivity capabilities.


Electronic BusinessElectronic Business

Businesses increasingly perform their basic functions: Businesses increasingly perform their basic functions: buying and selling goods and services, servicing buying and selling goods and services, servicing customers, and collaborating with business partners customers, and collaborating with business partners electronicallyelectronically

This process is known as This process is known as electronic business (E-electronic business (E-business) business) or or electronic commerce (E-commerce)electronic commerce (E-commerce)


New Economy vs. Old EconomyNew Economy vs. Old Economy

Example Example OldOld New New Buying and selling textbook Buying and selling textbook Visit the bookstoreVisit the bookstore Visit web site for publishers Visit web site for publishers

and retailers and retailers

Registering for classesRegistering for classes Walk around campus to Walk around campus to Departments, Registrar’s Departments, Registrar’s office, etc. office, etc.

Access campus web siteAccess campus web site

Photography Photography Buy film, use camera, take Buy film, use camera, take picture, take it for processing picture, take it for processing

Use digital cameraUse digital camera

Paying for GasolinePaying for Gasoline Fill up your car, go inside, pay Fill up your car, go inside, pay cash or credit card cash or credit card

Use speed pass token; wave Use speed pass token; wave over the sensor and go over the sensor and go

Paying for Transportation Paying for Transportation Pay cash, metal tokens Pay cash, metal tokens Metro cards electronic cardsMetro cards electronic cards

Paying for goodsPaying for goods Visit store, select item, pay, goVisit store, select item, pay, go Use self-service kiosksUse self-service kiosks

Supplying commercial photos Supplying commercial photos Use newspapers, paper, Use newspapers, paper, catalog, or online catalog, or online

Use hub-like supply chain with Use hub-like supply chain with digitized picture digitized picture



Example #1: Registering for ClassesExample #1: Registering for Classes

Old Economy: You would go to the Registrar’s Old Economy: You would go to the Registrar’s Office on campus with a paper registration Office on campus with a paper registration documentdocument

New Economy: You access your campus website, New Economy: You access your campus website, log into registration site, and electronically register log into registration site, and electronically register for classes from anywherefor classes from anywhere



Example #2: Buying and Selling TextbooksExample #2: Buying and Selling Textbooks

Old Economy: You go to the bookstore in person Old Economy: You go to the bookstore in person and buy new or sell used booksand buy new or sell used books

New Economy: You go online to the Publisher’s New Economy: You go online to the Publisher’s Web site or to Web-based services such as Web site or to Web-based services such as Amazon.com to buy or sell booksAmazon.com to buy or sell books



Example #3: PhotographyExample #3: Photography

Old Economy: You use a camera with film, which Old Economy: You use a camera with film, which you have to purchase and have developed; you you have to purchase and have developed; you mail copies of pictures.mail copies of pictures.

New Economy: You can scan photos, make copies New Economy: You can scan photos, make copies and e-mail them. Digital cameras require no film or and e-mail them. Digital cameras require no film or processing. Digital photography and video processing. Digital photography and video integrated into cell phones for immediate viewing integrated into cell phones for immediate viewing



Example #4: Paying for GasolineExample #4: Paying for Gasoline

Old Economy: You pump your gas and go inside to Old Economy: You pump your gas and go inside to pay using cash or creditpay using cash or credit

New Economy: Insert credit card at pump, receive New Economy: Insert credit card at pump, receive authorization, pump gas, get receipt, drive away. authorization, pump gas, get receipt, drive away. Another example is Speedpass technology.Another example is Speedpass technology.



Example #5: Paying for Transportation in New York CityExample #5: Paying for Transportation in New York City

Old Economy: Use tokens for bus and subway Old Economy: Use tokens for bus and subway transportationtransportation

New Economy: Bus and subway riders now use New Economy: Bus and subway riders now use MetroCards; contactless cards that have a small MetroCards; contactless cards that have a small radio transmitter that transmit account information radio transmitter that transmit account information to a readerto a reader



Example #6: Paying for Goods, CheckoutExample #6: Paying for Goods, Checkout

Old-old Economy: Customer selects goods, waits in Old-old Economy: Customer selects goods, waits in line for the cashier to key in price of items, and then line for the cashier to key in price of items, and then pays in cashpays in cash

Old Economy: The clerk swipes the barcode of Old Economy: The clerk swipes the barcode of each item and customer pays in cash, credit, or each item and customer pays in cash, credit, or debit. Information scanned is available for debit. Information scanned is available for immediate analysis known as immediate analysis known as source-data source-data automationautomation


New Economy vs. Old EconomyNew Economy vs. Old Economy (Ex. #6 Continued)(Ex. #6 Continued)

Example #6: Paying for Goods, Checkout continuedExample #6: Paying for Goods, Checkout continued

Old Economy: Shoppers take their items to a self-Old Economy: Shoppers take their items to a self-service kiosk and swipe the barcodes themselvesservice kiosk and swipe the barcodes themselves

New Economy: Wireless technology affixed to New Economy: Wireless technology affixed to each item. Allows you to select items that pass each item. Allows you to select items that pass through a scanner, which reads wireless signal, through a scanner, which reads wireless signal, generates a bill, automatically debits your generates a bill, automatically debits your designated account for payment and you leavedesignated account for payment and you leave


Three Types of Business Three Types of Business PressuresPressures

Market PressuresMarket Pressures: :

The Global Economy and Strong CompetitionThe Global Economy and Strong Competition

The Changing Nature of the WorkforceThe Changing Nature of the Workforce

Powerful CustomersPowerful Customers



Technology PressuresTechnology Pressures::

Technological Innovation and ObsolescenceTechnological Innovation and Obsolescence

Information OverloadInformation Overload



Societal PressuresSocietal Pressures: :

Social Responsibility Social Responsibility

Government Regulation and Deregulation Government Regulation and Deregulation

Protection Against Terrorist AttacksProtection Against Terrorist Attacks

Ethical IssuesEthical Issues


Organizational ResponsesOrganizational Responses

Strategic SystemsStrategic Systems provide advantages that enable provide advantages that enable organizations to increase market share and/or profits, organizations to increase market share and/or profits, better negotiate with suppliers, or prevent competitors better negotiate with suppliers, or prevent competitors from entering their marketsfrom entering their markets

Customer FocusCustomer Focus is the difference between attracting is the difference between attracting and keeping customers by providing superb customer and keeping customers by providing superb customer service and losing them to competitorsservice and losing them to competitors


Organizational ResponsesOrganizational Responses (Continued)(Continued)

Make-to-OrderMake-to-Order is a strategy of producing customized is a strategy of producing customized products and servicesproducts and services

Mass CustomizationMass Customization is producing a large quantity of is producing a large quantity of items, but customizing them to fit the desire of each items, but customizing them to fit the desire of each customercustomer

E-businessE-business and and E-commerceE-commerce is the strategy of doing is the strategy of doing business electronicallybusiness electronically


Why Should You Learn about Why Should You Learn about Information Technology (IT)?Information Technology (IT)?

IT is essential for work in organizationsIT is essential for work in organizations

IT will reduce the number of middle managersIT will reduce the number of middle managers

IT will change the manager’s jobIT will change the manager’s job

IT impacts employees at workIT impacts employees at work

IT impacts employees’ health and safetyIT impacts employees’ health and safety

IT is used by all departmentsIT is used by all departments


Why Should You Learn about Why Should You Learn about IT?IT? (Continued)(Continued)

IT provides opportunities for people with disabilitiesIT provides opportunities for people with disabilities

IT provides quality-of-life improvementsIT provides quality-of-life improvements

Improvements in health careImprovements in health care

Crime fighting and other benefitsCrime fighting and other benefits


Managerial IssuesManagerial Issues

Recognizing opportunities for using IT and Web-based systems.Recognizing opportunities for using IT and Web-based systems.

Who will build, operate, and maintain the information systems. Who will build, operate, and maintain the information systems. How much IT? How much IT?

How much and HOW important is IT? How much and HOW important is IT?

Is the situation going to change? Is the situation going to change?

Globalization. Globalization.


Managerial IssuesManagerial Issues (Continued)(Continued)

Ethics and social issues. Ethics and social issues.

Transforming the organization to the digital Transforming the organization to the digital economy. economy.

chapter 11 it support of organizational performance

Documents

business modelsenvironmental

complex business model

organizational pressures

digital enterprisesrecognize

digital businesschapter

future pressures

global economy

organizational responses