1. Strategic Uses of Information Technology Lecture 7

2. Today lecture summary Use of the Internet by businesses set off a revolution in the use of IT, so that utilizing the Internet to conduct business became the strategic use of information technology. The questions that remain are:  Has the revolution ended, or  Does an even larger revolution loom?  Does IT still matter?, and  What sorts of strategic uses are companies making?

3. Today lecture summary Strategic roles of IT fall into one of three categories: 1. “working inward” (improving a firm’s internal processes and structure) 2. “working outward” (improving the firm’s products and relationships with customers) and 3. “working across” (improving its processes and relationships with its business partners)

4. Today lecture summary Grainger, GE Power Systems, Wire Nova Scotia, The Shipping Industry, Cisco Systems and UPS Supply Chain Solutions, Semco, S. A., A Day in the Life of an E- lancer, General Mills and Land O’ Lakes, Sara Lee Bakery Group, and Dell Computer serve as examples of how companies are using information systems in strategic roles

5. Contents Introduction  History of Strategic Uses of IT  Whither the Internet Revolution?  The Cheap Revolution  Episode Two: Profitability Strikes Back  Does IT Still Matter? Working Inward: Business-to-Employee  Building an Intranet  Fostering a Sense of Belonging

6. Introduction Use of the Internet by businesses in mid/late ’90s set off a revolution in the use of IT  Utilizing the Internet to conduct business became the strategic use of IT Strategic = having a significant, long-term impact on a firm’s growth, industry and $$ What now?  Dot-com crash  A larger revolution to come?  Does IT still matter?  What strategic uses are companies making of IT (esp. the Internet)

8. Introduction Last 20 Years – Strategic Uses of IT 1 st edition  Mid 1980s, hot topic = end user computing (working inward) Help employees learn about PCs 2 nd edition  Late ’80s strategic use focused outward to gain competitive advantage e.g. Merrill Lynch cash management account  Now considered ‘normal’ = competitive necessity Vs. competitive advantage

9. Introduction Last 20 Years – Strategic Uses of IT cont. 3 rd & 4 th editions (1990s)  Strategic use attention turned inward to reengineering business processes Intent = not to automate existing processes but to totally redesign how the enterprise operated  Good idea but many failed as they were ‘lay-off’ plans Introduction of ERP systems was also aimed at internal operations, specifically providing single sources of data enterprise-wide

10. Introduction Last 20 Years – Strategic Uses of IT cont. 3 rd & 4 th editions (1990s) cont.  Internet’s potential becoming evident Dot-coms = looked at its outward use to gain a competitive advantage Most established firms initially used the Internet technology internally, building intranets to improve company processes  Publishing e-forms  Accompanying workflow processes

11. Introduction Last 20 Years – Strategic Uses of IT cont. 5 th edition (late ’90s)  Use of the Internet for business underway Bursting of the dot com bubble E-Business has become more reality based Integration of the Internet into how companies work has proceeded

12. Introduction Last 20 Years – Strategic Uses of IT cont. 6 th edition (early ’00s)  Theme = leveraging traditional operations by using the Internet to work more closely with others Innovations of the dot-coms created competitive challenges for ‘bricks and mortar’ firms – Their ‘strike back’ is essentially the theme for this 6 th edition

13. Introduction Last 20 Years – Strategic Uses of IT cont. 7 th edition (2005)  “Something has changed” Especially with regards to the use of IT for competitive advantage

14. Introduction Last 20 Years – Strategic Uses of IT cont.  Some may question IT’s ability to give companies a competitive edge but it is absolutely necessary for competitive parity (necessity?) Being used strategically:  Inward  Outward  Across

15. What Is the Internet? A network of networks, joining many government, university and private computers together and providing an infrastructure for the use of E-mail, bulletin boards, file archives, hypertext documents, databases and other computational resources The vast collection of computer networks which form and act as a single huge network for transport of data and messages across distances which can be anywhere from the same office to anywhere in the world.

16. What Is the Internet? Technically, the Internet is a global information system defined by three characteristics: A network composed of computers and other devices that are logically linked together by a unique address space based on the Internet Protocol

17. What Is the Internet? A network where network devices are able to support communications using TCP/IP (Transmission Control Protocol/Internet Protocol) or other compatible protocols A network that provides high-level services layered on a communication and network infrastructure

18. What Is the Internet? The largest network of networks in the world. Uses TCP/IP protocols and packet switching. Runs on any communications substrate.

19. Brief History of the Internet 1968 - DARPA (Defense Advanced Research Projects Agency) contracts with BBN (Bolt, Beranek & Newman) to create ARPAnet 1970 - First five nodes:  UCLA  Stanford  UC Santa Barbara  U of Utah, and  BBN 1974 - TCP specification by Vint Cerf 1984 – On January 1, the Internet with its 1000 hosts converts en masse to using TCP/IP for its messaging

20. A Brief Summary of the Evolution of the Internet 19451995 MemexConceived1945 WWWCreated1989 MosaicCreated1993 AMathematical Theory of Communication Communication1948 PacketSwitchingInvented1964 SiliconChip1958 First Vast ComputerNetworkEnvisioned1962 ARPANET1969 TCP/IPCreated1972 InternetNamedandGoes TCP/IP TCP/IP1984 HypertextInvented1965 Age of eCommerceBegins1995

21. The Creation of the Internet The creation of the Internet solved the following challenges:  Basically inventing digital networking as we know it  Survivability of an infrastructure to send / receive high-speed electronic messages  Reliability of computer messaging

22. Introduction Whither the Internet Revolution? Internet frenzy peaked in 2000 Is the Information Revolution dead?  Not if history is any guide  British Railway Revolution – mid 1800s  10 fold increase after the boom  During boom = great excitement and small companies flourished  After = glamour gone. Business became serious and full of hard work  Industry became orderly and profits began to reflect real returns  Connecting industries  Race for space followed by the ‘real deal’

23. Introduction Whither the Internet Revolution? cont. We are now in a period where organizations are re- architecting themselves around Internet technologies  Tearing down old structures as they go Real gains will come when Internet technology adapts to organizations and people  When the technology disappears and becomes part of life It will be ‘quiet’ compared to frenzy of ’99/00 but many think it will be a giant revolution

24. Major Internet Services E-mail: Person-to-person messaging; document sharing Usenet newsgroups: Discussion groups on electronic bulletin boards

25. Major Internet Services conti.. LISTSERVs: Discussion groups using e-mail mailing list servers Chatting and instant messaging: Interactive conversations

26. Major Internet Services Conti.. Telnet: Logging on to one computer system and doing work on another FTP: Transferring files from computer to computer World Wide Web: Retrieving, formatting, and displaying information (including text, audio, graphics, and video) using hypertext links

27. The Internet and Business Value The World Wide Web: HTTP (Hypertext Transfer Protocol): communications standard used to transfer pages on the Web. URL (Uniform Resource Locator) Web servers

28. Searching for information on the Web The Internet lowers search costs Search engines Intelligent agents and shopping bots

29. Internet Network Architecture Figure 7-9

30. Intranets and Extranets Intranets: An intranet is an internal organizational network that provides access to data across a business firm. Extranets: Allow authorized vendors and customers to have limited access to its internal intranet

31. Introduction The Cheap Revolution CIOs are shifting from buying expensive proprietary products to buying cheap generic products  “Cheap Tech” Cost savings are compelling  Google = runs on 100,000 cheap servers One breaks = discards  Avoids expensive service contracts and in-house staff

32. Introduction The Cheap Revolution  “Dellification” Moved from selling PCs to also selling servers, printers, storage devices….  “Cheap” is occurring elsewhere: Labor – outsourcing to other countries Film production – camcorders etc. Software – Linux Vs. Microsoft Telecommunications – Voice-over-IP…

33. Revolution of Social Media Social media refers to online services that allow people to publicly create, share, and discuss information Social media services include, but are not limited to: Blogs Social networks such as Facebook and MySpace

34. Social Media Conti Video and photo sharing sites such as YouTube and Flickr Microblogging services such as Twitter Social bookmarking services such as Digg and Delicious

35. Why use Social Media?  Social media is becoming many people’s primary source of news, opinion, and entertainment Social media is now ubiquitous -- widespread blogging, social networks, video sharing sites, and opportunities to comment on and rate online content Power of personal connections -- Research shows people are more compelled to act on information that’s transmitted through personal ties

36. Why use Social Media? Relevancy for government – We can use social media to share timely government information with the people who need it Engaging citizens to improve government -- Social media allows people to engage, to provide input for improving government services, and be part of the democratic process

37. Making Government Easy with Social Media Review of USA.gov & GobiernoUSA.gov Social Media Strategy Examples of how we’re using social media

38. Social Media Strategy Development Social Media Preferences We reviewed analytics and surveyed social media users, which showed: Interested in accessing government information via social media Credibility of government information on social media is critical Interested in having conversations with the government

39. Social Media Strategy Development Social Media Preferences conti.. Interested in a variety of government information, including: Emergency alerts Social Security Other government benefits Relevant and timely content is critical – the technology used to deliver it is secondary

40. Social Media Strategy Development Social Media Best Practices We examined a variety of social media initiatives and identified these best practices: Seek or create user interfaces that foster interaction: Interaction should be easy and intuitive Use branding elements to make it clear that users are interacting with an official source

41. Social Media Strategy Development Social Media Best Practices Engage constituents: Answer constituent comments in a friendly and personal manner Establish clear guidelines for engagement, and empower government reps to interact with constituents

42. Social Media Strategy Development Social Media Best Practices Solicit feedback and encourage sharing: Whenever possible, invite opinions and experiences from constituents to stimulate dialogue Provide links or buttons to share content and encourage users to do so with clear calls to action

43. Social Media Strategy Development Social Media Best Practices Provide relevant and timely content: Use social media to listen to conversations and allow constituents to identify topics of interest Use existing content assets to initiate timely discussions

44. Social Media Strategy Development Social Media Best Practices Dedicate resources: Dedicate resources to own the conversation and optimize the program based on feedback

45. Planning a Social Media Strategy We used a strategic approach to address constituents via social media, thinking about our audience and objectives before choosing a technology 1. Define objectives: Conducted stakeholder interviews to learn about our own motivations to use social media and learn what we wanted to get out of it

46. Planning a Social Media Strategy conti.. 2. Perform audience research: Surveyed users and analyzed traffic to learn about constituents’ objectives and needs 3. Identify best practices: Looked at other organizations to see how they use social media to achieve objectives

47. Planning a Social Media Strategy conti.. 4. Develop a long term strategy : Developed a scalable strategy that would accomplish our objectives, independent of technology, while fulfilling constituent needs

48. Our Social Media Objectives An extensive internal review process revealed the need to use social media to: Put a human face on government Establish USA.gov & GobiernoUSA.gov as approachable sources of trusted information Create new channels to distribute existing content, news, and information

49. Our Social Media Objectives conti Spread information virally Interact directly with constituents Encourage public engagement with government

50. Summary Introduction  History of Strategic Uses of IT  Whither the Internet Revolution?  The Cheap Revolution  Social media