Strategic Information Systems Management Information Systems Antoine HARFOUCHE

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Strategic Information Systems Management Information Systems Antoine HARFOUCHE, PHD

Strategic Information Systems Management Information Systems Antoine HARFOUCHE, PHD

Strategic Information Systems A. IS and IT are different • IT/ICT refers specifically to

Strategic Information Systems A. IS and IT are different • IT/ICT refers specifically to technology, essentially hardware, software and telecommunications networks. – Tangible (e. g. servers, PCs, routers, cables), and – Intangible (e. g. software) • IT/ICT facilitates the acquisition, processing, storing, delivery and sharing of information & other digital content. • IS – the means by which people & organizations, utilizing technology, gather, process, store, use & disseminate information (UK Academy of ISs) • Some IS are totally automated by IT. IS ≠ IT

Strategic Information Systems IS is a combination of three components Perspectives on Information Systems

Strategic Information Systems IS is a combination of three components Perspectives on Information Systems Are More Than Computers 2 1 3

Strategic Information Systems 1. Technological dimension

Strategic Information Systems 1. Technological dimension

Strategic Information Systems 2. Organizational dimension of the Information Systems 2 Organizational dimension of

Strategic Information Systems 2. Organizational dimension of the Information Systems 2 Organizational dimension of the Information Systems • Competitive advantage can not be created just by having the best technology. • People must accept it and used it in a clever and strategic way. • Features of organizations • Use of hierarchical structure • Accountability, authority in system of impartial decision making • Adherence to principle of efficiency • Routines and business processes • Organizational politics, culture, environments and structures 5

Strategic Information Systems 3. Strategic dimension of the Information Systems 3 Management dimension of

Strategic Information Systems 3. Strategic dimension of the Information Systems 3 Management dimension of information systems – Managers set organizational strategy for responding to business challenges – In addition, managers must act creatively: • Creation of new Business models • Occasionally re-creating the organization 6

B. The Startegic alignment • A high degree of fit and consonance between the

B. The Startegic alignment • A high degree of fit and consonance between the priorities and activities of the IS function and the strategic direction of the firm • Careful planning is critical for strategic alignments, especially for firms in highly competitive environments 7

Strategic Information Systems Why the alignment matters? Operational excellence is central to creating and

Strategic Information Systems Why the alignment matters? Operational excellence is central to creating and sustaining strategic advantage and change!

Strategic Alignment • Alignment between the business and IT strategies • Alignment between strategy

Strategic Alignment • Alignment between the business and IT strategies • Alignment between strategy and capabilities Business IS Business Strategy IS Strategy Value Business Capabilities IT Capabilities Including infrastructure IT infrastructure • Technology IT infrastructure • Human IT infrastructure

Strategic Information Systems Three levels of IS 1. The technological dimension of the alignment

Strategic Information Systems Three levels of IS 1. The technological dimension of the alignment

Strategic Information Systems The ERP • Enterprise Systems – Also called “enterprise resource planning

Strategic Information Systems The ERP • Enterprise Systems – Also called “enterprise resource planning (ERP) systems” – Suite of integrated software modules and a common central database – Collects data from many divisions of firm for use in nearly all of firm’s internal business activities – Information entered in one process is immediately available for other processes 11

Strategic Information Systems BI Business Intelligence E MAILING • Business Intelligence: – Tools for

Strategic Information Systems BI Business Intelligence E MAILING • Business Intelligence: – Tools for consolidating, analyzing, and providing access to vast amounts of data to help users make better business decisions – Principle tools include: • ETL • Online analytical processing (OLAP) • Data mining Website Social Network History DATAWAREHOUSE ETL 2 OLAP 1 3 Data mining The Data Marts HRM Acc Finance Accounting HRM Finance

Strategic Information Systems The 3 organizational dimensions 2. The organizational dimension of the alignment

Strategic Information Systems The 3 organizational dimensions 2. The organizational dimension of the alignment – Managers set organizational structure for responding to strategic business challenges – In addition, they must recreat the organization 13

Strategic Information Systems 5 Business strategies 3. The strategic dimension of the alignment •

Strategic Information Systems 5 Business strategies 3. The strategic dimension of the alignment • Five strategies for dealing with competitive forces, enabled by Network organizations – Low-cost leadership – Product differentiation – Focus on market niche – Strengthen customer and supplier intimacy – Blue Ocean Strategy 14

Strategic Information Systems IS strategies 4. The IS strategy dimension of the alignment •

Strategic Information Systems IS strategies 4. The IS strategy dimension of the alignment • Integrating • Tracking • . . .

Strategic Information Systems IS strategies 4’. The Web strategy dimension of the alignment •

Strategic Information Systems IS strategies 4’. The Web strategy dimension of the alignment • Benefits of co-creation • Benefits of personalization/customization • Benefits of integrating communication channels in one channel • Benefits Virtual Communities • Benefits of Disintermediation

C. Pillars of Business Model

C. Pillars of Business Model

Crowdsourcing • The recruitment and coordination of piece-meal work across the internet to achieve

Crowdsourcing • The recruitment and coordination of piece-meal work across the internet to achieve a goal. 1. Speeds up content creation 2. Gets clients and collaborators involved 3. Gets target audience involved 4. Offers diversity and creative choice 5. Drives development of scalable processes (Bratvold, 2012)

Crowdfunding

Crowdfunding

Different models Donation based: Allows charities, or those who raise money for social or

Different models Donation based: Allows charities, or those who raise money for social or charitable projects, to gather a community online and to enable them to donate to a specific project. Reward based: Enables people to contribute to projects and receive non–financial rewards in return, usually operating a tiered system where the more you donate the better the reward you receive £% . Lending based: Projects or businesses seeking debt apply through the platform uploading their pitch, with members of the crowd taking small chunks of the overall loan. Equity based: Enables the crowd to invest for equity, or profit/revenue sharing in businesses or projects. This form of the model has been the slowest to grow due to regulatory restrictions that relate to this type of activity.

The search for collaborative advantage • Seek out opportunities for horizontal as well as

The search for collaborative advantage • Seek out opportunities for horizontal as well as vertical collaboration • Co-operate to grow the cake, compete on how to slice it • Leveraging capabilities and knowledge through collaboration • Share assets in the supply chain where appropriate 21

Collaborative Relationships Customers • Risk-sharing contracts • Collaborative transactions Competitors Horizontal partners • Trade

Collaborative Relationships Customers • Risk-sharing contracts • Collaborative transactions Competitors Horizontal partners • Trade associations • Benchmarking A company • R&D Consortia • Collaborative logistics • Standard-setting • Joint MRO bodies procurement • Industry lobbying Suppliers • co-epetition • Risk-sharing contracts • Collaborative transactions

Strategic Information Systems With suppliers: Vendor Management Inventory • Vendor Managed Inventory (VMI) is

Strategic Information Systems With suppliers: Vendor Management Inventory • Vendor Managed Inventory (VMI) is a procurement and planning practice in which a company delegate’s key inventory management functions to one or more of its suppliers. • Under this arrangement the supplier determines the items, quantities, and delivery schedules on behalf of the customer based on information it receives from the customer’s inventory and procurement systems. • Using VMI, manufacturers and distributors can anticipate customer needs and provide inventory more proactively than is possible using traditional procurement methods 23

With suppliers: Collaborative Planning, Forecasting and Replenishment (CPFR) • Builds on “best-in-class” VMI implementations

With suppliers: Collaborative Planning, Forecasting and Replenishment (CPFR) • Builds on “best-in-class” VMI implementations • Principles: – Builds on the trading partners’ competencies (includes several “scenarios”) – Working off a single forecast which imbeds the retailer’s view (of multiple suppliers’ plans) and the supplier’s view (of multiple retailers’ actions) – Making the whole supply chain more efficient

With competitors: Co-opetition: a definition A business strategy based on a combination of cooperation

With competitors: Co-opetition: a definition A business strategy based on a combination of cooperation and competition, derived from an understanding that business competitors can benefit when they work together. A “non zero sum” scenario, in which the sum of what is gained by all players is greater than the combined sum of what the players entered the scenario with. Source: D. Meyer, 15 th March 2011 and istockphoto 25

With customers: Value co-creation Value Propositions describes what creates value for a targeted Customer

With customers: Value co-creation Value Propositions describes what creates value for a targeted Customer Segment. § § § Newness Performance Customization “Getting the job done” Brand / Status Design § § § Cost reduction Risk reduction Accessibility Convenience Usability

With customers: Value co-creation Source: J. H. Dyer, Collaborative Advantages Traditional Relationship Value to

With customers: Value co-creation Source: J. H. Dyer, Collaborative Advantages Traditional Relationship Value to Supplier • • Focus on expanding the pie Value to Customer Focus on splitting the pie Extended Enterprise Value to Supplier Co-creation relates to the value received by the customer through usage, consumption or experience. (Lusch & Vargo 2006). Occurs whenever consumers interact with companies or products and thereby have an active role in the shaping of their experience and ultimately value perception. 27

With customers: Value co-creation

With customers: Value co-creation

With customers: Customization • • • Pure standardization Segmented standardization Customized standardization Tailored customization

With customers: Customization • • • Pure standardization Segmented standardization Customized standardization Tailored customization Pure customization