1. CHAPTER 1 MANAGING IT IN AN E-WORLD

2. CHAPTER 1 MANAGING IT IN AN E-WORLD
Information technology (IT) –
computer technology (hardware and software) for processing and storing information, as well as communications technology for transmitting information
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3. CHAPTER 1 MANAGING IT IN AN E-WORLD
Managing IT in business today is very different from managing in a prebrowser world
Business managers now expect:
Information on firm’s internal operations
Data about external market conditions
Automated personal organizers
Networks always available
Applications that are easy to use
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4. RECENT INFORMATION TECHNOLOGY TRENDS
Hard to predict trends due to rate of change in IT industry
Consider several mis-predictions …
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5. MISPREDICTIONS BY IT INDUSTRY LEADERS
This “telephone” has too many shortcomings to be seriously
considered as a means of communication. The device is inherently
of no value to us.
-Western Union internal memo, 1876
I think there is a world market for maybe five computers.
-Thomas Watson, chairman of IBM, 1943
But what [is a microchip] good for?
-Engineer at the Advanced Computing
Systems Division of IBM, 1968
There is no reason anyone would want a computer in their home.
-Ken Olson, president, chairman, and founder of Digital Equipment Corp., 1977
640K ought to be enough for anybody.
-Attributed to Bill Gates, chairman of Microsoft, 1981
Dell has a great business model, but that dog won’t scale.
-John Shoemaker, head of Sun’s server division, 2000
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6. RECENT INFORMATION TECHNOLOGY TRENDS
Computer Hardware: Faster, Smaller, Cheaper
1981: first IBM PC
1990s: PCs commonplace
Now ...
Easy-to-use operating system with graphical interface
Web browser ready
Point-and-click technology
Plays music and videos
Notebook versions common for business travel
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7. RECENT INFORMATION TECHNOLOGY TRENDS
Computer Software: Standardized and Integrated
Majority of microcomputers:
Microsoft Windows – operating system software
Microsoft Office Suite – productivity software
Word processing
Spreadsheet
Database
Presentation
Web browser
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8. RECENT INFORMATION TECHNOLOGY TRENDS
Computer Software: Standardized and Integrated
Enterprise system packages –
software packages with integrated modules that pass common business transactions across groups, divisions, and national boundaries in “real time”
Widely adopted by manufacturing and service firms of all sizes
Often tailored to specific industries
Integrate data across traditional and Web-based channels for internal use, customers, and suppliers
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9. RECENT INFORMATION TECHNOLOGY TRENDS
Computer Networks: High Bandwidth, Global, and Wireless
1990s:
Standards for browser applications and Internet communications (TCP/IP)
Fiber-optic lines used by more telecommunications providers
High-speed access (high-bandwidth lines) available both to businesses and home owners
2000:
Commonplace for company networks linked to the Internet
2003:
Home owners using modems to connect to cable lines or digital subscriber lines (DSL) via telephone lines
Today:
More companies investing in wireless technology
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10. RECENT INFORMATION TECHNOLOGY TRENDS
Consider:
By 2000, more than half of U.S. business capital expenditures were for IT
Today, IT can not only enable, but can also help shape business strategies
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11. RECENT INFORMATION TECHNOLOGY TRENDS
Traditional Ways to Compete
Three ways to compete (Porter, 1980):
Cost – by being a low-cost producer of a good or service
Differentiation – by offering products or services customers prefer due to superiority with innovativeness, image, quality, or customer service
Focus – competing on cost or differentiation within a specific market niche
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12. RECENT INFORMATION TECHNOLOGY TRENDS
Traditional Ways to Compete
IT can help with cost
Examples:
Automating transaction time
Shortening order cycle time
Providing operational information for decision making
IT can help with differentiation
Giving sales personnel information to better serve customers
Providing just-in-time supplies for customers
Creating new information-based products
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13. RECENT INFORMATION TECHNOLOGY TRENDS
New Ways to Compete
Using the Internet
Examples:
Entire travel industry restructured because of competition via the Internet
Wal-Mart, Dell, and Lands’ End leverage Internet to compete
Results: achieve additional cost savings, mass customize products, and reach even more customers
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14. WORKING IN AN E-WORLD
Business invests more in IT support for today’s knowledge workers
IT infrastructure now must support workers anytime and anywhere
Sales force personnel are now telecommuters
Telecommuters –
One who works from a location outside the firm’s regular offices and “commutes” via telecommunications lines in order to do his or her work
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15. WORKING IN AN E-WORLD E-mail Document sharing
More Productive Teams
Document sharing
Software to support collaborative teamwork
Videoconferencing
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16. WORKING IN AN E-WORLD Virtual Organizations
Virtual Organizations and Free Agents
Virtual Organizations
Temporary alliances between organizations and individuals
Contracts often gain scarce expertise or cheaper labor costs
Some might have no real office; employees can be located anywhere
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17. WORKING IN AN E-WORLD Free Agents
Virtual Organizations and Free Agents
Free Agents
Are telecommuters who do knowledge work without being at a specific location
Have specialized skills and IT linkages to work as independent contractors
Often post resumes and sell skills globally
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18. LIVING IN AN E-WORLD Advantages Disadvantages
Fast, convenient communication with cell phones
Vast amounts of “free” information via the Internet
Disadvantages
Loss of individual privacy
Vulnerability to computer crimes
Social inequalities due to lack of access to computers
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19. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
Information systems (IS) organization –
department or unit that has primary responsibility for managing IT – hardware, software, networks, and IS professionals
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20. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
Accounting Era
Back-office computer automation began with accounting
1950s to mid-1960s
IS professionals were primary decision makers but reported into an accounting function
Transaction processing automated with use of computers for single functions
(transactions were aggregated and then processed in a single run or “batch” – magnetic tape storage)
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Figure Five IS Management Eras
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21. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
Operational Era
Computer automation expanded to other functions
Began mid-1960s
Business managers became more involved in systems decision making
(as applications supported more business functions)
Online systems were introduced for transaction processing
(made possible by direct access storage devices using magnetic disks)
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Figure Five IS Management Eras
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22. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
Information Era
IT investments to support the knowledge worker
Late 1970s – mid 1980s
End users became direct users of computer applications using user-friendly mainframe and microcomputer tools
Decision support systems that could “interact” with users were introduced
(made possible by software tools developed for direct end-user computing)
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Figure Five IS Management Eras
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23. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
Network Era
IT investments in interenterprise systems
Began mid-1980s
Business managers began to take more of an “ownership” role in IT investments
Computer networking enabled applications with business partners
(custom-developed inter-organizational applications)
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Figure Five IS Management Eras
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24. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
Internet Era
IT investments to support new kinds of e-business
Began mid-1990s with Web browser
Top management has taken a leadership role in IT decision making to ensure that IT investments are strategically aligned with the business
The Internet and Web-based applications provide a global reach to customers and business partners
(enabled by a standard communication protocol and standard Web browswer)
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Figure Five IS Management Eras
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25. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
Managing the IT Assets
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Figure Three IT Assets
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26. Managing the IT Assets Page 9 Figure 1.3 Enterprise IT Architecture
(Based on Weil and Broadbent, 1998)
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27. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
People Roles
IS Leaders
Other IS Managers
IS Professionals
Business Managers
End Users
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28. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
People Roles
IS Leaders
Chief Information Officer (CIO) –
a firm’s high-level general IT asset manager with both technology and business leadership experience who, together with the executive management team, plans for integration of IT for strategic advantage
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29. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
People Roles
Other IS Managers … accountable for:
Data centers
Network operations
New applications development
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30. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
People Roles
IS Professionals … include:
Programmers
Software engineers
Systems analysts
Database developers
Web developers
LAN administrators
Technical support specialists
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31. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
People Roles
Business Managers …
Are internal customers of the IT organization
Need to be IT-savvy
May jointly lead strategic IT projects
Provide other IT-related roles:
Serve on committees to prioritize and approve IT requests
Act as sponsor or “owner” of an IT project
Serve as process or functional expert on project team
Participate in planning and execution of IT implementation
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32. THE IS MANAGEMENT ROLE IN ORGANIZATIONS
People Roles
End Users …
Provide business expertise to project teams
Participate in redesign of business processes
Give feedback to prototype screens and reports during system development
Help gather customer input when they are directly affected by IT project
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