Presentation on theme: "CHAPTER 1 INTRODUCTION : BUSINESS AND INFORMATION TECHNOLOGY"— Presentation transcript:
1 CHAPTER 1 INTRODUCTION : BUSINESS AND INFORMATION TECHNOLOGY
2 Learning ObjectivesDiscuss business pressures and responses in today’s Information AgeDifferentiate between data and information, and describe the characteristics of high-quality data.Name and describe the components of an information system.Describe the capabilities expected of information systems in modern organizations.Describe opportunities for strategic use of information systems.
3 Case : Blades Board & Skate rapid growth The Business Problemretailer of ice and inline skates and snowboardsthe business needed a computer system that could instantly track sales and inventory at all of its storesThe Solutionpoint-of-sales (POS) systemscomputerized cash registers that use specialized software to record transaction data such as the stock numbers of items sold, cost , time of sale, and information on the customer, such as namehelp retailers cut costs, increase profits, and serve customers better by making the most of sales information
4 Case (continued…) The Results Quicker, more accurate, and more detailed picture of sales and inventoryTied into the firm’s accounting softwareOrder products from vendors only when needed, decreasing the amount of warehouse space
5 Case (continued…) What have we learned from this case?? Information Technologies are woven into complex systemsinterrelating with other systemspermeating every business processenabling tremendous gains in knowledge, productivity, and profitabilityA great variety of information can now be gathered at each part of each business process, and information can be distributed throughout the organization, giving knowledge and insight for competitive decision making and strategic advantage.
6 Business in the Information Age: Pressures Global Competition for Market and for LaborNeed for Real-time OperationsChanging Work ForceCustomer-Oriented OperationsTechnological Innovation and ObsolescenceInformation OverloadSocial Responsibility of OrganizationsGovernment Regulation and DeregulationEthical IssuesOrganizational Responses to Business Pressures in the Information Age
7 Business in the Information Age: Responses Strategic SystemsCustomer Focus and Customer Servicemass customizationContinuous Improvement Effortsjust-in-time (JIT) total quality management (TQM)Business Process ReengineeringEmpowering Employees and Fostering Collaborative WorkTeam-based StructureBusiness Alliancessupply chain management and enterprise resource planning (ERP)Electronic Commerce
8 Business Pressures & Organizational Responses : Summary Global Competition for Market and LaborNeed for Real-time OperationsChanging Work ForceCustomer OrientationTechnological Innovation and ObsolescenceInformation OverloadSocial ResponsibilityGovernment Regulation and DeregulationEthical IssuesOrganizational ResponsesStrategic SystemsCustomer Focus and Customer ServiceContinuous Improvement Efforts (Just-in-Time, Total Quality Management)Business Process Reengineering (BPR)Team-based StructureBusiness AlliancesElectronic Commerce
9 Why You Need to Learn About Information Technology IT is Generally InterestingIT Facilitates Work in OrganizationsIT Offers Career OpportunitiesIT is Used by All DepartmentsLocating real estate at nations bankUsing IT to strategic advantage at McDonald’s CanadaUsing IT to manage human resources at the City of Winnipeg in Manitoba, Canada
10 Why You Need to Learn About Information Technology (continued…) Web-based One-to-One Marketing at Liberty Financial Companiesone-to-one Web Marketingaims to personalize a user’s online experience by offering services and advertisements that are likely to appeal to that personWeb-site operator can use the information it collects on individuals to provide customized contentused Web-based marketing software to build its database of customer profilesinvestors able to find exactly the information they need, quickly and easily from Web sites
11 What is a Computer-Based Information System? A computer-based information system (CBIS) is an information system that uses computer and often telecommunications technology to perform some or all of its intended tasks. An information technology is a particular component of a system, like a personal computer, a printer, or a network. But few information technologies are used alone. Rather, they are most effective combined into information systems. The basic components of information systems are the following:Hardware SoftwareDatabase NetworkProcedures People
12 Components of Computer-based Information System HARDWARESOFTWAREDATABASENETWORKPROCEDURESPEOPLE
13 Capabilities of Information Systems Provide Fast and Accurate TransactionProvide Large Capacity, Fast Access StorageProvide Fast Communications (machine to machine, human to human)Reduce Information OverloadSpan BoundariesProvide Support for Decision MakingProvide a Competitive WeaponGeneral Technological Trends for IT
14 Strategic Questions and Information Technology Answer Information Technology and organizational strategy are inseparablePorter’s strategic analysis model (5 forces models)the relative power of buyers and suppliers, threats from substitute products and services, and the ease or difficulty with which new competitors can enter the industryValue chainthe discrete steps involved in the manufacturing of a product or the provision of a service
15 Strategic Questions (continued…) Can we use IT to gain leverage over our suppliers? To improve our bargaining power? To reduce their bargaining power?Can we use IT to reduce purchasing costs? To reduce our order processing costs? To reduce suppliers’ billing costs?Can we use IT to identify alternative supply sources? To locate substitute products? To identify lower-price suppliers?Can we use IT to improve the quality of products and services we receive from suppliers? To reduce order lead times? To monitor quality? To leverage supplier service data for better service to our customers?Can we use IT to give us access to vital information about our suppliers that will help us reduce our costs? To select the most appropriate products? To negotiate price breaks? To monitor work progress and readjust our schedules? To assess quality control?Can we use IT to give our suppliers information important to them that will in turn yield a cost, quality, or service reliability advantage to us? To conduct electronic exchange of data to reduce their costs? To provide master production schedule changes?
16 Strategic Questions (continued…) Can we use IT to reduce our customer’s cost of doing business with us? To reduce paperwork for ordering or paying? To provide status information more rapidly? To reduce our costs and prices?Can we provide some unique information to our customers that will make them buy our products/service? Can we provide better billing or account status data? Can we provide options to switch to higher-value substitutes? Can we be first with an easy-to-duplicate feature that will provide value simply by being first?Can we use IT to increase our customers’ costs of switching to a new supplier? Can we provide proprietary hardware or software? Can we make customers dependent upon us for their data? Can we make our customer service more personalized?Can we use external database sources to learn more about our customers and discover possible market niches? To relate buying from us to buying other products? To analyze customers interactions with us and questions to us to develop customized products/services or methods of responding to customer needs?
17 Strategic Questions (continued…) Can we use IT to help our customers increase their revenues? To provide proprietary market data to them? To support their access to their markets through our channels?Can we use IT to raise the entry barriers of new competitors into our markets? To redefine product features around IT components? To provide customer services through IT?Can we use IT to differentiate our products/services? To highlight existing differentiations? To create new differentiations?Can we use IT to make a preemptive move over our competition? To offer something new because we have proprietary data?Can we use IT to provide substitutes? To simulate other products? To enhance our existing products?Can we use IT to match an existing competitor’s offerings? Are competitor products/services based on unique IT capabilities or technologies and capabilities generally available?
18 Information Technology Answer (continued…) Information Technology AnswersConsolidated Stores invested $80 million in KBToys.com, a site it will jointly own with startup BrainPlay.comPetSmart plans to invest $16 million in 1999 in PetSmart.com, a site it will jointly own with startup PetJungle.comToys “R” Us invested $80 million to relaunch Toysrus.com, which will be run as a standalone businessCVS spent $30 million to buy online pharmacy Soma.com
19 The Plan of This BookPart 1 INFORMATION TECHNOLOGY IN THE BUSINESS ENVIRONMENT1. Introduction : Business and Information Technology2. Organizational Structure and Information TechnologyPart 2 INFORMATION TECHNOLGY INFRASTRUCTURE3. Computer Hardware4. Computer Software5. Managing Organizational Data and Information6. Telecommunications and Networks7. The Internet and IntranetsPart 3 APPLYING INFORMATION TECHNOLOGY FOR COMPETITIVE ADVANTAGE8. Interorganizational and Global Information Systems9. Functional and Enterprise Systems10. Data, knowledge, and Decision Support11. Intelligent Systems in Business12. Electronic Commerce13. Strategic Information Systems and ReorganizationPart 4 DEVELOPING AND MANAGING INFORMATION SYSTEMS14. Information Systems Development15. Implementing IT:Ethics, Impacts, and Security
20 What’s in IT for Me? For Accounting For Finance Information systems capture, organize, analyze, and disseminate data and information throughout modern organizationsFor FinanceInformation systems turn financial world on speed, volume, and accuracy of information flow
21 What’s in IT for Me? (continued …) For MarketingThe Internet and the World Wide Web have opened an entirely new channel for marketing and provided much closer contact between the consumer and the supplierFor Production/Operations ManagementEvery process in a product or service’s value chain can be enhanced by the proper use of computer-based information systems
22 What’s in IT for Me? (continued …) For Human Resource ManagementEmployees can handle much of their personal business themselves, and the Internet makes a tremendous amount of information available to the job seekerFor Management Information Systems (MIS)The opportunities for those planning a career in MIS grows as fast as the adoption of information technologies into organizations everywhere