1. Management Information Systems
Islamia University of Bahawalpur
Delivered by:
Tasawar Javed
Lecture 7

2. Information System For Competitive Advantage
Today’s talk
Challenges from global Competitor
Challenges in developing global information system
Knowledge management
Dimensions of information

3. Information System For Competitive Advantage
MNC
Is a firm that operates across products, markets, nations, and cultures
It consist of the parent company and a group of subsidiaries
The subsidiaries are geographically dispersed
Own unique goals
Policies
And procedures

4. Challenges from Global Competitors
Outsourcing???
Should not limit thinking of global competitors
Professionals and staff working in other countries who compete for the same jobs as those in the host country may also be considered competitors
US companies outsourcing to
China, Ireland, Scotland, Russia and India
The main reason to outsource is economic
Chinese labour cost is cheaper than in US
Same as in India
IBM, one of India’s largest call-center companies
At the same time IBM had more than 9,000 employees in India who developed SW systems

5. The Special Need for Information Processing in an MNC
MNC have special need for Information processing and coordination
MNC minimize ‘uncertainty’
‘uncertainty’ is the “difference between the amount of information required to perform the task and the amount of information already possessed by the organization”
Most MNC executives recognize that they can cope with their environmental influences by making good use of IT

6. Need for coordination in an MNC
Coordination is key to achieving CA in the global marketplace
Companies that are unable to gain strategic control of their worldwide operations and manage them in a globally coordinated manner will not succeed in the international economy
MNC are facing more challenges as compare to those who restricts its activities to its home country
Improvements in IT, methodology, and communications have made global coordination much easier but it is still big challenge for MNCs

7. The Advantage of Coordination
Flexibility in responding to competitors in different countries & markets
Ability to respond in one country- or in a region of a country- to a change in another country
Ability to keep abreast of market need around the world
Ability to transfer knowledge between units in different countries
Reduced overall costs of operation
Increased efficiency and effectiveness in meeting customer needs
Ability to achieve and maintain diversity in the firm’s products and in how products are produced and distributed
All of these advantages are due to reductions in time and cost of communications made possible through use of the firm’s information resources

8. Challenges in Developing Global IS
It’s a challenge to develop IS
The term ‘Global Information System’ describes an IS that consist of networks that cross national boundaries
Challenges are:
Politically imposed Constraints
Cultural and communications Barriers
Technological problems
Lack of support from Subsidiary Managers

9. Challenges are:…. Politically imposed constraints
Political Governments can impose some restrictions
It can make difficult for those MNC or
It can make easy to operate
It can make difficult or easy for parent to include that subsidiary on the network
Reason could be:
Restriction is limited access to high speed communication
Telephone infrastructure is frequently owned and operated by the government, not private firms..

10. Challenges are:….. Cultural & Communication Barriers
Interaction with technology vary among cultures
GIS interfaces need to be consistent even as different languages
Must offer multiple formats that yield the same functionality
It also includes:
Restrictions on HW purchases and imports
Restrictions on Data Processing
Restrictions on data communication

11. Challenges are…… Technological problems
MNCs are often plagued with problems related to the level of technology that exists in subsidiary countries.
In some countries; reliable power sources are not available, resulting in frequent power outages
Telecommunication circuits often can only transmit data at slow speed, an the transmission quality may be poor.
SW can also be a problem; many countries don’t honor SW copyrights
Black market SW
SW vendors refuses to do business in certain countries

12. Challenges are….. Managers are also part of problem
Some convinced that they can run their subsidiary with out help,
They view head office regulations as unnecessary
Foreign office and middle line managers may fear being bypassed by the new information links that funnel operational data to the parent
MNCs attempt for GISs. It is impossible to finish problems completely

13. Knowledge Management A firm’s resources consist of: Computer HW
Computer SW
Information specialists
Users
Facilities
Databases
Information
All of this activities, acquiring data, processing data into info, using & communication info in the most effective way, and discarding info at the proper time is called
Knowledge Management

14. Dimensions of information
Relevancy (relevant to problem)
Accuracy (payroll, billing, receivables)
Timelines
Completeness

15. Thank you!!!
Q&A