Strategy and Information Systems Chapter 3. 3-2 “How Would We Do That? Where’s the Data?”...
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Strategy and Information Systems Chapter 3. 3-2 “How Would We Do That? Where’s the Data?” Buyers don’t communicate with operations when negotiating with
3-2 How Would We Do That? Wheres the Data? Buyers dont
communicate with operations when negotiating with vendors Buyers
need data to look at prices and costs of dealing with individual
vendors Need more data and people involved in negotiating deals
Copyright 2014 Pearson Education, Inc. Publishing as Prentice
Hall
Slide 3
3-3 Study Questions QI: How does organizational strategy
determine information systems structure? Q2: What five forces
determine industry structure? Q3: How does analysis of industry
structure determine competitive strategy? Q4: How does competitive
strategy determine value chain structure? Q5: How do business
processes generate value? Q6: How does competitive strategy
determine business processes and the structure of information
systems? Q7: How do information systems provide competitive
advantages? Q8: 2023? Copyright 2014 Pearson Education, Inc.
Publishing as Prentice Hall
Slide 4
3-4 Q1: How Does Organizational Strategy Determine Information
Systems Structure? Copyright 2014 Pearson Education, Inc.
Publishing as Prentice Hall
Slide 5
3-5 Q2: What Five Forces Determine Industry Structure?
Copyright 2014 Pearson Education, Inc. Publishing as Prentice
Hall
Slide 6
3-6 Examples of Five Forces Copyright 2014 Pearson Education,
Inc. Publishing as Prentice Hall
Slide 7
3-7 Five Forces at GearUp Copyright 2014 Pearson Education,
Inc. Publishing as Prentice Hall
Slide 8
3-8 Q3: How Does Analysis of Industry Structure Determine
Competitive Strategy? Copyright 2014 Pearson Education, Inc.
Publishing as Prentice Hall
Slide 9
3-9 GearUps Competitive Strategy Low Cost/Focused Do everything
to keep costs down Focus within sporting goods category Focus on
buyers interested in special, short-term sales Copyright 2014
Pearson Education, Inc. Publishing as Prentice Hall
Slide 10
3-10 Ethics Guide: Yikes! Bikes You are operations manager for
Yikes! Bikes, a manufacturer of high-end mountain bicycles. New
owners plan to pursue lowest-cost vendor strategy by importing
low-cost, lower quality bikes. New owners are not being honest with
employees about cutting jobs. Say you might be promoted to new
general manager. Should you trust them? Q: Are owners actions
illegal? Unethical? Copyright 2014 Pearson Education, Inc.
Publishing as Prentice Hall
Slide 11
3-11 Q4: How Does Competitive Strategy Determine Value Chain
Structure? Copyright 2014 Pearson Education, Inc. Publishing as
Prentice Hall
Slide 12
3-12 Value Chain Structure? Copyright 2014 Pearson Education,
Inc. Publishing as Prentice Hall
Slide 13
3-13 Support Activities in the Value Chain Copyright 2014
Pearson Education, Inc. Publishing as Prentice Hall Support
ActivityDescription Technology R & D, New Techniques, Methods,
Procedures ProcurementRaw Materials Human ResourcesTraining,
Recruiting, Compensation Firm Infrastructure General Management,
Finance, Accounting, Legal, Government Affairs
Slide 14
3-14 Q5: How Do Business Processes Generate Value? Copyright
2014 Pearson Education, Inc. Publishing as Prentice Hall
Slide 15
3-15 Improved Material Ordering Process Copyright 2014 Pearson
Education, Inc. Publishing as Prentice Hall
Slide 16
3-16 Q6: How Does Competitive Strategy Determine Business
Processes and the Structure of Information Systems? Copyright 2014
Pearson Education, Inc. Publishing as Prentice Hall
Slide 17
3-17 Operations Value Chains for Bicycle Rental Companies: High
Service Rentals Copyright 2014 Pearson Education, Inc. Publishing
as Prentice Hall
Slide 18
3-18 Business Process and Information Systems for High-Service
Bike Rental Copyright 2014 Pearson Education, Inc. Publishing as
Prentice Hall
Slide 19
3-19 Using MIS InClass 3: Competitive Strategy Over the Web
1.Briefly visit each pair. www.sportsauthority.com vs.
www.soccer.comwww.sportsauthority.comwww.soccer.com www.target.com
vs. www.sephora.comwww.target.comwww.sephora.com www.woot.com vs.
www.amazon.comwww.woot.comwww.amazon.com www.petco.com vs.
www.healthyfoodforpets.comwww.petco.comwww.healthyfoodforpets.com
www.llbean.com vs. www.rei.comwww.llbean.comwww.rei.com 2.Select
two pairs from the list. For each pair of companies, answer the
questions on p. 84. Copyright 2014 Pearson Education, Inc.
Publishing as Prentice Hall
Slide 20
3-20 Q7: How Do Information Systems Provide Competitive
Advantages? Copyright 2014 Pearson Education, Inc. Publishing as
Prentice Hall
Slide 21
3-21 Competitive Advantage via Processes Implementation 1.Lock
in customers o Create high switching costs 2.Lock in suppliers o
Make it easy to connect to and work with your organization 3.Create
entry barriers Make it difficult and expensive for new competition
4.Create better business processes to establish alliances Copyright
2014 Pearson Education, Inc. Publishing as Prentice Hall
Slide 22
3-22 How Does an Actual Company Use IS to Create Competitive
Advantages? ABC, Inc. created competitive advantage in shipping
industry through: Superior customer service Ease of customer
business use by minimizing data entry: Drop-down lists, automatic
fill-ins, contact lists for customers Minimizing data-entry errors
Following slides show Web pages of ABCs information system.
Copyright 2014 Pearson Education, Inc. Publishing as Prentice
Hall
Slide 23
3-23 Two Roles for Information Systems Regarding Products
Copyright 2014 Pearson Education, Inc. Publishing as Prentice
Hall
Slide 24
3-24 How Does an Actual Company Use IS to Create Competitive
Advantages? Copyright 2014 Pearson Education, Inc. Publishing as
Prentice Hall
Slide 25
3-25 Automatic Retrieval of Customer Data Copyright 2014
Pearson Education, Inc. Publishing as Prentice Hall
Slide 26
3-26 ABC, Inc., Web Page to Specify Email Notification
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Hall
Slide 27
3-27 ABC, Inc., Web Page to Print a Shipping Label Copyright
2014 Pearson Education, Inc. Publishing as Prentice Hall
Slide 28
3-28 How Does This System Create a Competitive Advantage?
Enhances existing products Differentiates products Locks in
customers Raises barriers to market entry Increases profit margins
by decreasing costs and decreasing errors Copyright 2014 Pearson
Education, Inc. Publishing as Prentice Hall
Slide 29
3-29 Q8: 2023? Unlikely GearUp will exist New opportunities for
IT-based organizations Reduce medical costs by supporting
governmental functions, like Medicare and related programs
Web-based services to track medical bills, Medicare and
supplemental insurance payments, track unpaid bills Copyright 2014
Pearson Education, Inc. Publishing as Prentice Hall
Slide 30
3-30 Security Guide: Differentiating on Security! Major data
centers harden their sites; computer criminals turn to less
strongly protected assets held by small organizations and
individuals Habit of effective security behavior easy way to gain a
competitive advantage Copyright 2014 Pearson Education, Inc.
Publishing as Prentice Hall
Slide 31
3-31 Guide: Your Personal Competitive Advantage Who will be
your competitors when you seek a job after graduating from college?
What will be your competitive advantage in the job market? What can
you do before you graduate to develop your competitive advantage?
Copyright 2014 Pearson Education, Inc. Publishing as Prentice
Hall
Slide 32
3-32 Guide: Your Personal Competitive Advantage (contd) How
could these concepts help you get and keep a job? Switching costs?
Differentiating products? Creating barriers? Establishing
alliances? Reducing costs, increasing revenues? Copyright 2014
Pearson Education, Inc. Publishing as Prentice Hall
Slide 33
3-33 Case Study 3: Fulfillment by Amazon (FBA): Primary product
offerings: 1.Online retail store 2.Computing infrastructure leasing
3.Order fulfillment services Amazon buys, takes ownership, physical
possession, inventories good, sells from inventory Copyright 2014
Pearson Education, Inc. Publishing as Prentice Hall
Slide 34
3-34 Is FBA Right for GearUp? Outsource to Amazon, thus
avoiding cost of developing own processes, facilities, and order
fulfillment information systems. Copyright 2014 Pearson Education,
Inc. Publishing as Prentice Hall
Slide 35
3-35 FBA Fees for Products Like Sporting Goods as of May 2012
Copyright 2014 Pearson Education, Inc. Publishing as Prentice
Hall