Business development with IS
PORTER'S GENERIC STRATEGIES
How businesses can build a sustainable competitive advantage › Cost leadership - lowest-cost producer › Differentiation - product is unique › Focus - limited scope
PROJECT LIFE CYCLE
1. PROJECT DEFINITION Who, and how many people are involved? - Stakeholders (Inside the organization affected) Identify project stakeholders › individuals and organizations that are affected by or can affect the project Establish primary responsibilities › E.g., in a responsibility matrix listing deliverables with who is responsible etc. (Assigning people to the different tasks) Develop scope statement PROJECT CHARTER (Element inside project) Typically created by the project sponsor, and approved by key stakeholders (Upper management approves the project) Defines the responsibilities and boundaries of the project manager and the project 2. Project planning (How to get it done!) ESTIMATING Costs (in budgets) Schedules (in Gantt charts) Resources Risks NETWORK DIAGRAM GANTT CHART 3. PROJECT EXECUTION (Monitoring!) Project work is beingdone Monitor › Costs › Schedules › Resources › Risks Manage the team members Track the project progression Perform quality control Communicate with the stakeholders 4. PROJECT CLOSING (Hand over deliverables!) Project deliverables are given to the customer together with › Documentation › User training Resources used on the project must be released to work on other projects
IT GOVERNANCE
A management tool for aligning business and technology initiatives throughout a company
LEAVITT'S BUSINESS DIAMOND
Analysing the organisation wide effects a change strategy will have. The author outlined 4 independent components of every organisation; tasks, people, structure and technology. Using IS in an organization will affect each of these components. Use this framework to identify where these impacts are likely to occur
THE STRATEGY TRIANGLE
Balance between the three strategies must be maintained in business planning Business strategy drives all other strategies as a rule of thumb Organizational and IS strategy are dependent upon the business strategy and should support it Be aligned with the business strategy! - If you change a IS component, expect change in Business strategy! Changes in any of the strategies requires changes in the other strategies to maintain the balance - All three strategies are affected by the other strategies - Implementing a strategy always involves consequences. Ignored warnings because they thought it wasnt "their responsibility" (Individual groups)
BUSINESS PROCESS MANAGEMENT CYCLE (BPM)
Creation of a formal process (design) Ongoing management › Measurement of process performance › Sense customer needs and expectations › Benchmark against the competitors Performance gaps › Faulty execution (occasional error pattern): hard to find the cause, but easy to fix › Faulty design (continuous error pattern): easy to find, but hard to fix Develop plan and fix errors Re-iterate cycle Benefits: We are better than before!
BUILD VS. BUY
Custom built • Hybrid solutions • Commercial Off the Shelf (COTS)
THE INFORMATION PROCESSING CYCLE
Input: Collection of data and their conversion into a form that allows processing. Processing: Manipulation and transformation of data. Storage: Holding place for data so that they can be retrieved at a later time. Output: Transformation of processed data into a form that can be understood by its eventual user. Control: Enforcement of correct processing procedures
Information Quality Dimensions
Intrinsic Accurate Believable Objective Consistent Understandable Contextual Relevant Timely Complete Current
Spiral Model
Iterative version of SDLC (Waterfall) Risk driven model, by identifying project risks and ways to reduce them an adaptive SDLC approach that cycles over and over again through development activities until completion
CUSTOMER RELATIONSHIP MANAGEMENT (CRM)
Managing organizations multiple interactions with customers CRM manages and supports activities performed to obtain, enhance relationships with, and retain customers. › Includes the processes: sales, support, and service › Contains information about customers › Analyzing information about customers THREE COMPONENTS OF A CRM SYSTEM 1. Operational (day-to-day) 2. Collaborative ( 3. Analytical Benefits: Increased customer service More efficient sales transactions Cross sales/Up sales More efficient call centers More effective sales and marketing efforts Increased earnings
PORTER'S FIVE COMPETITIVE FORCES MODEL
Now used in IS: Analyze how competitive an industry is and therefore determine if a particular market could be attractive for an organization to consider.
ORGANIZATIONAL STRATEGY
Organizational strategy is the organization's design as well as the choices the organization makes to define, set up, coordinate, and control its work processes
THE MANAGERIAL LEVERS
Organizational variables, control variables, and cultural variables are the levers managers can use to affect change in their organization This is a more detailed model than the Business diamond and gives specific areas where IS can be used to manage the organization and to change the organization
Paired comparisons matrix
Paired Comparison Analysis is an activity for evaluating a small range of options by comparing them against each other Top grayed out because it is duplicate comparisons
FOUR COMMON APPROACHES TO IMPLEMENTATION
Parallel Reduced risk but double work! Phased Old system parallel (Double work) reduced risk Big-bang implementation "Direct changeover" (In book) No overlap (Risk) Save effort Pilot Run new system in parallel (Make sure it works correctly!)
Customer Service Life Cycle
Understand the various tasks of a CRM system Phases customers pass through when interacting with the organization Engage Transact Fulfil Service --> Repeat
The internet and Web
Web user Internet Web server
IS STRATEGY MATRIX
What, Who uses, who delivers, Where Hardware Software Networking Data
THE BULLWHIP EFFECT
occurs when distorted product-demand information ripples from one partner to the next throughout the supply chain
ENTERPRISE APPLICATION ARCHITECTURE
overview of major cross-functional enterprise applications and their interrelationships
SWOT
strengths, weaknesses, opportunities, threats
Cloud Computing
the practice of using a network of remote servers hosted on the Internet to store, manage, and process data, rather than a local server or a personal computer.
The Extract, Transform Load Process (ETL)
used to pull data from these disparate data sources to populate & maintain data warehouse
BUSINESS PROCESS MANAGEMENT (BPM)
- BPM is a management discipline that treats business processes as assets to be valued, designed and exploited in their own right - BPM is a structured approach employing methods, policies, metrics, management practices and software tools to manage and continuously optimize an organization's processes BPM aims to improve agility and operational performance BPM treats processes as organizational building blocks with as much (if not more) significance as functional areas and geographic territories Why do companies adopt BPM? Enterprises adopt BPM because they anticipate frequent process changes To stay competitive you need to improve processes continuously!
Sample Service-Oriented Architecture (SOA) layout
A middleware for communication and translation between technology and users Interconnect devices
WHAT IS A PROCESS?
A process is a series of coordinated activities that lead to a specific goal or outcome "All or nothing" Often called business processes, but they could more precisely be labelled organizational processes Business processes are responsible for carrying information around in the organization
PROCESSES
A process is a series of steps or tasks required to achieve a specific goal - In organizations, everything that happens is based on a series of processes - NOT completely LINEAR (Also parralell) - Business, sell and buy a car in the same time Processes can usually be decomposed into several tasks, also called sub-processes. Processes typically extend across many organizational boundaries, they are cross-functional. A well defined process has: › a beginning and an end › inputs and outputs › a set of tasks (sub-processes or activities) that transform the inputs into outputs › a set of metrics for measuring effectiveness › a set of associated roles and responsibilities
WHAT IS A PROGRAM?
A program involves several projects closely related and designed to accomplish a common goal, but performed as individual projects. When the projects are all completed, the program is completed. Example: consider each class you take as a project that is part of your program of study
WHAT IS A PROJECT PORTFOLIO?
A project portfolio is a large number of projects or programs that an organization is concurrently performing or considering Project portfolio management is the process of selecting and coordinating projects in the whole organization, thereby creating an overview of all projects
NETWORK DIAGRAM
A schematic display of the logical relationships or sequencing of project activities Shows: Dependencies between tasks Critical Path in a project
Swimlane diagram
A swimlane diagram is a type of flowchart that delineates who does what in a process. Using the metaphor of lanes in a pool, a swimlane diagram provides clarity and accountability by placing process steps within the horizontal or vertical "swimlanes" of a particular employee, work group or department. Process models (e.g. swimlane diagrams)
System definition
A system is a set of interacting components, working together to form a complex, integrated whole in order to achieve some goal by taking inputs and processing them to produce outputs
WHAT IS A PROJECT?
A temporary endeavor undertaken to create a unique product, service, or result. Temporary means that every project has a clear beginning and a clear end. Unique means that the product or service is different and can be distinguished from the regular, day-to-day operations or other projects
GANTT CHART
A time and activity bar chart that is used for planning, managing, and controlling major programs that have a distinct beginning and end.
Levels of Information systems
A typical organization is divided into operational, middle, and upper level. The information requirements for users at each level differ. Towards that end, there are number of information systems that support each level in an organization.
INFORMATION SYSTEM - DEFINITION
An information system is "a combination of technology, data, people and processes that is directed toward the collection, manipulation, storage, ..., and communication of information" - Let us gather large amounts of data quickly, easily and reliably - Allow businesses to store and organize very large amounts of data 6 elements 1. Facts, letters, numbers, images etc. 2. Hardware - Physical devices -processor, storage, printer etc. 3. Software -Set of instructions that govern the operation of an IS (e.g. application) 4. Media - Rules (protocols) for enabling computers to communicate 5. Procedures - Instructions for proper use of the IS 6. People - Users of the system 4 different purposes 1. Process improvement 2. Automation 3. Control 4. Information flow
Interaction between applications and databases
Application requests data - Sends updates Database sends requested data
KNOWLEDGE MANAGEMENT PROCESS
Applying knowledge leads to the creation of new knowledge The main process of Knowledge Management consists of creation, capture, codification, storage, retrieval, transfer, and application. 1. Create 2. Capture and Codify 3. Store and Retrieve 4. Transfer and Apply TYPES OF KNOWLEDGE Explicit Expressed easily Easily Shared "Knowing that" Tacit Difficult to communicate Rooted in life experiences "Knowing how"
EVALUATION OF RISKS (RISK MATRIX)
Assess each risk for impact to the project if it does occur Assess the likelihood of the risk occurrence
Work Breakdown Structures (WBS)
Break down deliverables in Work Breakdown Structures (WBS) Estimate each work package with respect to › Cost › Schedule › Resources needed › Risks
BUSINESS INTELLIGENCE
Business intelligence is: Set of applications, technologies and processes, for gathering, storing, analyzing and accessing data, to help users make better business decisions MAKE SENSE OF DATA Google analytics, be smarter and make better decisions DATA WAREHOUSING Subject oriented grouping of data
Client/service computing architecture
Client -> Network -> Webserver etc.
PORTER'S VALUE CHAIN
Competition can come from two sources: › Lowering cost to perform an activity › Adding value to product or service How can you make it more efficient? Or How can you add value
Access Levels for Information Security
Data -> Data access policies and controls -> Application access control -> Network and host access control University grading system, professor acces university network with user ID and password
E-BUSINESS & E-COMMERCE
E-business: When individuals, companies or government agencies use electronic means to interact or conduct business, such as: - Automate business processes - Deliver information - Email, news groups, chat rooms, websites - Improve service - Online access to buy and sell Critical mass: The more people you have, the more value you get E-commerce: E-commerce covers outward-facing processes that touch customers, suppliers and external partners, including sales, marketing, order taking, delivery, customer service
ENTITYRELATIONSHIPDIAGRAM (ERD)
ERD = Entity Relationship Diagram 1. Entity Entity is an object/concept about which the system needs to store data - E.g. Customer, Order, or Product - Entities are modelled as rectangles 2. Relationship Entities can be in relationships with one another: Entity Relationship Diagram › E.g. a Customer places an Order or a Student attend a School › Relationships are modeled as straight lines between entities Entities have attributes, which are characteristics that are important to the system e.g. customer name, phone number, product name, price etc. Every entity must have a primary key. The primary key is an attribute or combination of attributes that uniquely identify an instance of the entity All attributes that uniquely identifies a specific record in an entity are Candidate Keys A Foreign Key is an attribute in one entity that is the Primary Key of another entity CARDINALITY relations between entities Intersection Several products - can consist of many order lines
B2B TECHNOLOGIES
Electronic Data Interchange (EDI) Volkswagen order brakes, sent electronically to the supplier... - Send product, trigger invoice, money transferred -> confirmed over EDI Supply Chain Management (SCM)
EXECUTIVE INFORMATION SYS
Executive Information Systems (EIS) and Dashboards Information to monitor business activities Information for decision making
TUCKMANN`S TEAM DEVELOPMENT STAGES
Forming, storming, norming, performing Forming: behavior is driven by a desire to be accepted and avoid conflict, people focus on being busy with routines, i.e. team organization, who does what, when to meet, etc., but are also gathering information and impressions about each other, and about the scope of the task and how to approach it. Storming: focus on what problem are we really to solve, how is this going to work, members confronting each other's ideas and perspectives. Not a pleasant stage, but necessary in order to move forward. Be patient and tolerant of each other and your differences, else you will fail to become a high-performing team. Norming: establishing the "rules of engagement", understanding and appreciating each other's skills and experience, focus on the assignment, efficiency increases strongly in the entire period Performing: collaboration and trust, roles and responsibilities change seamlessly according to need. High morale, loyalty and group identity -and high degree of comfort. All the energy is directed towards the task in hand.
DATA MODELLINGPROCESS
Framework of the relationships within a database! Data modeling is a process used to define and analyze data requirements needed to support the business processes Data models are made up of entities, which are the objects or concepts we want to track data about, and they become the tables in a database. Products, vendors, and customers are all examples of potential entities in a data model - the data the systems need to store and manage - the most efficient way of organizing the data - potential risks and challenges related to data within the organization
COMMON IT-OUTSOURCING MODELS
Full or complete outsourcing: Vendor handles all IT functions so the organization can focus on its core activities Selective or partial outsourcing: Only certain aspects of IT are outsourced to a vendor Process-based outsourcing: Only a particular function or business process (e.g. payroll, help desk, etc.) is outsourced Personnel outsourcing: Temporary hires employees (e.g. consultants) without the long- term costs associated with hiring permanent employees Project-based outsourcing: Contracting with a vendor for a specific project Application outsourcing: Vendor handles activities related to a specific software application for a fee Offshore outsourcing: Use of a vendor that provides services from a location outside the organization's own region Nearshore outsourcing: Use of a vendor that provides services from a location within the organization's own region Onshore outsourcing: Outsourcing to a vendor in the same country
FUNCTIONAL (SILO) PERSPECTIVE VERSUS BUSINESS PROCESS PERSPECTIVE
Functional Perspective Activities are carried out in self- contained functional units such as Marketing, Operations, Finance, etc. Business Process Perspective Activities are carried out in coherent processes that turn inputs into outputs
IS STRATEGY
IS strategy is the plan an organization uses to provide information systems and services.
THE IT ENGAGEMENT MODEL
IT GOVERNANCE MODEL (aligning business and technology) All six stakeholder groups should be engaged in order to assure alignment within an organization Might deviate: use linking mechanisms! - coordinates everything in the vertical - Connects projects to companies
STRATEGIC PLANNING PROCESS
Identify how the organisation will use and manage its resources for strategy purposes (think competitive advantages) The identification of strategic information systems should follow a structured set of steps in an iterative process. Goal: identification of strategic IS-initiatives.
Rapid Application Development (RAD) cycle
Is a form of agile software development methodology that prioritizes rapid prototype releases and iterations. Continues until fullsystem is developed User involvement (cheaper) Unlike the Waterfall method, RAD emphasizes the use of software and user feedback over strict planning and requirements recording.
SECI Model of Organisational KNOWLEDGE CREATION
Knowledge creation is a continious process, consisting of interactions between IMPLICIT (Tacit) and EXPLICIT knowledge Cycle of increasing knowledge Knowledge can be purchased: reports, people Socialization: Sympathized knowledge, e.g. mental models, know-how. Created by socialization through imitation and observation. Externalization: Conceptual knowledge, e.g. concepts? Creation of dialogue or collective reflection that makes tacit knowledge explicit, e.g. through formalization. Combination: Systemic knowledge, e.g. models, prototypes and checklists. Created by combining explicit knowledge with more coherent knowledge as a result. Internalization: Operational knowledge, e.g. what works in practice. Created by internalization through action and learning-by-doing, resulting in experience and reflections.
EXPERT SYSTEMS
Narrow focus on specific problem(s) Troubleshooting websites Medical self-diagnosis (netdoktor) Call-center back office
D'AVENI'S 7'S
Part of the Hypercompetition theory, where trying to sustain a competitive advantage will be deadly since it is rapidly eroded. 1. Superior stakeholder satisfaction Maximizing customer satisfaction by adding value strategically. 2. Strategic soothsaying Using new knowledge to predict or create new windows of opportunity. 3. Positioning for speed Preparing the organization to react as fast as possible. 4. Positioning for surprise Preparing the organization to respond to the marketplace in a manner that will surprise competitors. 5. Shifting the rules of competition Finding new ways to serve customers, transforming the industry. 6. Signaling strategic intent Communicating intentions in order to stall responses by competitors. 7. Simultaneous and sequential strategic thrusts Taking steps to stun and confuse competitors in order to disrupt or block their efforts.
STRATEGIC APPROACHES AND IT APPLICATIONS
Porter's generic strategies Dynamic environment strategies Social business strategy
WHAT IS PROJECT MANAGEMENT?
Project management is the process of managing projects with the goal of completing them successfully, that is generally: › On time › Within budget › With the agreed scope Changes in any one of the sides of the triangle affect one or both of the other sides Therefore, managing projects involves trade-offs between › Time › Cost › Scope -the deliverable at the end of the project The project stakeholders decide on the overriding "key success factor" (i.e., time, cost or scope). Is the content achieved or not? Letbanen (The quality wasnt that great as well)
ROLES IN THE PROJECT ORGANIZATION
Project manager - the person responsible for accomplishment of the project Project team - the people who are to cooperate about finishing the project Project sponsor - thegeneral manager who provides the resourcesand benefits from the resultof the project Stakeholders - the individuals and organizations that are affected by or can affect the project, e.g.: › The project manager, project team, and the project sponsor. › The customer -the individuals or organizations who are to use the project's product. Different types may be involved. › Suppliers › The IT department, and the department which will operate the system
RADICAL VS INCREMENTAL CHANGE
RADICAL CHANGE Fundamental change of business processes Radical change typically faces greater internal resistance compared with incremental change. INCREMENTAL CHANGE Business processes are improved through small, incremental changes Employees often react favorably to incremental change
Business Process Redesign (Reengineering) Stages
Redesign of business processes to improve how work is done. Business modelling done first Changing the way tasks are performed (Iterative process) Effectiveness efficiency Internal control Compliance
FUNCTIONAL (SILO) PERSPECTIVE
Static view (Production, marketing, purchase) A typical organization structure is arranged by function But they also create silos... Disadvantages: Communication gaps between departments duplication of work -or forgotten work Lost information in business processes -execution errors
Hierarchical information system
Strategic Tactical Operational Vision › Strategies to achieve the mission › Goals and objectives "Know who you are" What is the best strategy? Given the mission: "Saving people money so they can live better" - what is the best strategy?
System Development Life Cycle (SDLC)
The overall process for developing information systems from planning and analysis through implementation and maintenance (Waterfall model) Maintenance typically (50% cost of project)
DATA MINING
The process of analyzing data to identify trends, patterns and other useful information Machine learning algorithms "People who bougth this product also bought these products..." Which event follows on the next one - Is the customer pregnant (certain buying order) - Trace pregnancy stage Teenage girl pregnant (Sent vouchers for diapers) - Learned about pregnancy through retailer!
SUPPLY CHAIN MANAGEMENT (SCM)
Three flows in a supply chain - Material/Product flow - Information flow - Capital/Financial flow Integrating the supply chain by linking processes across organizations Network technology links customers and suppliers through a single network Costs and opportunities are optimized for all companies in the supply chain Globalization have enabled businesses to integrate customers and suppliers from the supply chain from almost anywhere in the world => more varied supply and lower prices
DECISION SUPPORT SYSTEMS
To identify and solve problems and make decisions. Decision Support Systems (DSS) Data Driven DSS Model Driven DSS (Simulation/optimization etc.) Document Driven DSS Communication Driven DSS Groupware Shared whiteboards (Experts together) Video conferencing/remote presentation Chat systems, e-mails, discussion databases Workflow systems, document co-editing (Google docs)
TRADITIONAL VS. AGILE APPROACHES
Traditional: One SDLC phase after the other Agile: Many iterations through all SDLC phases
Enterprise Resource Planning (ERP)
a suite of applications called modules, a database, and a set of inherent processes for consolidating business operations into a single, consistent, computing platform A cross functional information system Definition: Information systems that cross boarders for traditional business functions in order to renew and improve vital business processes across an organization - With the purpose of improving business via use of information systems
VIRTUAL VALUE CHAIN
activities that turn raw data into information No physical product!(Just information!) Consulting firms Google: only use data in their value chain! - ALL virtual
What is a TYPICAL FUNCTIONAL ORGANISATION?
board of directors etc. flat hierarchy
PRIORITY MATRIX
framework that allows managers to evaluate potential initiatives and prioritize them along two key dimensions: the ease of implementation and the potential returns
RISK RESPONSE MATRIX
risk event, response, contingency plan, trigger, who is responsible
THREE POINT ESTIMATING
› a = the best-case estimate › m = the most likely estimate › b = the worst-case estimate Calculate an estimate and see what approximately will happen! Confidence level in E value +/-SD is approximately 68% Confidence level in E value +/-2 ×SD is approximately 95% Confidence level in E value +/-3 ×SD is approximately 99.7%
