Sylnovie Merchant, Ph.D. MIS 281 Spring 2005 Lecture 4 IT and E-Business Lifecycles

Sylnovie Merchant, Ph.D. MIS 281 Spring 2005

Lecture 4IT and E-Business

Lifecycles


General Questions

• General Questions -• What is the Business Process Issue that I am

trying to solve?• What technology should be used?• What is the impact on other business resources

(including human)?• What are the costs and benefits to be considered?• Emphasis on ‘Does the solution make sense?’!?


IT as an Essential Enabler• IT permits companies to reengineer business

processes by breaking existing rules

• Think inductively -- Instead to looking for solutions for existing problems, recognize new powerful technology first and then seek the problems it might solve

• Recognize business opportunities created by breaking long-standing rules


Organizational Responses

Framework for Organizational and Societal Impacts of Information Technology

Management

and

Business Process

Organization

Structure and the

Corporate Culture

Individual

and Roles

Information

Technology

The Organization’s

Strategy

External Environment, Social, Economic, Political, etc


Lucas, 1975A descriptive model of information systems in the context of the organizations

ManagementAction

InformationServices Dept.

Design and Operations Policies,

Attitudes

ContactInvolvement

UserAttitudes andPerceptions

TechnicalQuality of

System

Use ofSystem

AnalysisAction

Performance

DecisionStyle

Situational &Personal Factors


Lessons From the Past

• Introducing information systems was the challenge of the 70’s

• Successfully introducing Electronic Commerce/Electronic Business is the current challenge


Failure to adopt MIS/IS Innovations in the 70’s Linked

to:• absence of an IS champion• lack of management support • strain on manager’s time• negative attitudes• little education and training • organizational, technical problems• perceived gaps between expectations of

system providers and users


Success in adopting MIS/IS was linked to:• commitment• executive sponsor • quick feedback• dedicated facilities• software and hardware support• training• congruence of system and managerial expectations

Successful Adoption


Success occurred when relative advantage was shown in terms of:

• time saved,

• benefits accrued

• competitive pressure decreased,

• making the firm flexible and profitable.

• positive relationship between manager and external consultant

Successful Adoption (con’t)


Benefits to Organizations

– Reduces the time between the outlay of capital and the receipt of products and services

– Supports business processes reengineering (BPR) efforts

– Lowers telecommunications cost - the Internet is much cheaper than previous communication technologies


Reengineering: The Path to Change

• Definition

“The fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed.”

(Hammer & Champy, 1993)


Electronic Commerce/Electronic Business

• Is not about technology itself

• It is about business and how businesses use the available technology and applications to meet their business needs– Improving effectiveness, efficiency, flexibility

and capability to adapt to changing conditions

Electronic Commerce/Electronic Business

• E-commerce/e-business implies the application of technology either:– as a solution to a business problem or need

which involves the exchange of information between business partners

– as a means of grasping an opportunity

Evaluating E-Commerce/E-Business

• Why use e-commerce/e-business?– Need to change the way business is conducted– Increasing competition to deliver increasing

levels of product and service quality– can assist to reduce the cost of doing business

Business Issues When Implementing EC/EB

• Staffing issues

• Trading partner issues

• Business process issues

• Technology, implementation, and maintenance issues

• Control, Audit and Legal issues

EC/EB Technologies and Applications

• need to be considered in the light of BOTH:– the benefits and direct and indirect costs of

implementation (both tangible and intangible), and

– the costs of not implementing electronic commerce


What EC/EB Does

• Collapse administrative, marketing, distribution layers– reduce cost, cycle time

• Eliminate, rather than streamline, bureaucracies– top-down structure replaced by

consumer driven, bottom-up structure

Component Parts of EC/EB

• Common business services for facilitating the buying and selling process

• Messaging and information distribution, as a means of sending and retrieving information

– Kalakota and Whinston

Component parts of EC/EB (cont’d)

• Multimedia content and network publishing, for creating a product and a means to communicate it

• The Information Superhighway - the very foundation - for providing the highway system for EC/EB

Three Pillars Supporting EC/EB

• Public policy, to govern such issues as universal access, privacy and information pricing

• Self regulation of business relationships through ethical standards– Ethical standards– Trust

• Technical standards, to dictate the nature of information publishing, user interfaces and transport across the entire network

What Does EB/EC Imply?

– Labour intensive --> IT Intensive– Paper documents --> Electronic documents– Written signatures --> Digital signatures– Physical security --> Electronic security– Data and graphics --> Multimedia– Present environment --> 2000+ IT infrastructure


The Impact of EC/EB on Traditional Retailing System

• Disintermediation and Re-intermediation

– Disintermediation — the removal of organizations or business process layers responsible for certain intermediary steps in a given value chain

• eliminating the traditional intermediaries, such as wholesalers, distributors, and retailers, to reduce the cost

– Re-intermediation — the shifting or transfer of the intermediary functions, rather than the complete elimination

• intermediation such as electronic shopping malls, directory and search engine service, and comparison aids using agents creates the role of re-intermediation


The Systems and E-Business Lifecycles


Systems Development Lifecycle (SDLC)

• Three major activities– Analysis: understanding business needs– Design: conceptualizing computer-system solution– Implementation: construction, testing, and

installation

• Two additional phases– Project planning– Support


SDLC Concepts

• All projects use some variation of the SDLC

• SDLC is more than phases

– Principles of management

– Planning and control

– Organization and scheduling

– Problem solving


Planning Phase

• Define problem

• Confirm project feasibility

• Produce project schedule

• Staff the project

• Launch the project


Analysis Phase

• Gather information

• Define system requirements

• Build prototypes for discovery of requirements

• Prioritize requirements

• Generate and evaluate alternatives

• Review recommendations with management


Design Phase

• Design and integrate the network

• Design the application architecture

• Design the user interfaces

• Design the system interfaces

• Design and integrate the database

• Prototype for design details

• Design and integrate the system controls


Implementation Phase

• Construct software components• Verify and test• Develop prototypes for tuning• Convert data• Train and document• Install the system


Support Phase• Objective: Keep system running

productively following initial installation

– End-user support

• Help desks

• Training programs

– Maintaining and enhancing computer system

• Enhancements

• Upgrades

• Maintenance


E-Business

• E-Business Life Cycle– Planning– Marketing– Fulfillment– Maintenance & Enhancement


PLANNING

• Strategizing Reality– Evaluate a company’s position & competition– Set a course for years ahead– Develop implementation plan


STRATEGIZING

• Know Your Audience

• Become Internet Savvy

• Determine Long-term vs. Short-term Selling

• Define Your Competitors

• Evaluate Website Appearance


STRATEGIZING (Cont’d)

• Select Product Range

• Manage Transaction Effectively & Efficiently

• Design Shipment Process

• Be Prepared for Unexpected Changes


ULTIMATE STRATEGY

• Vision– What is your business trying to achieve?

• Resources– How much can your business afford to build the

right Website?

• Culture– Is your business politically amenable for

coordinating efforts to support e-business?


PLANNING CONSIDERATIONS

• Create & Maintain a Competitive Edge

• Reduce Operational Costs

• Improve Employee Communication & Satisfaction

• Find New Markets for Products & Services

• Improve relationships with Partners


PLANNING CONSIDERATIONS (Cont’d)

• Create Distinct Distribution Channels

• Ensure Customer Satisfaction

• Adopt Sense of Entrepreneurship

• Improve Supply-Chain Management

Documents

Sylnovie Merchant, Ph.D. MIS 281 Spring 2005 Lecture 4 IT and E-Business Lifecycles