MIS 320 Mid Term
Fundamental question in Internet era:
"How can I possibly compete when everyone can copy my technology and the competition is just a click away?"
Are Droids Taking Our Jobs?
(add)
What are some examples of technology from the 2000's?
- Apple OSX launched in 2001 - Wikipedia in 2001 - Facebook in 2004 - iPhone in 2007 - iPad in 2010
What personal computers were apart of this revolution in the 1980's?
- IBM PC 1981 - Macintosh: Steve Jobs Unveiled this in 1984 - Commodore 64 in 1982
Brand
- The symbolic embodiment of all the information connected with a product or service. - Having a strong brand lowers costs associated with finding products - Example: Coca-Cola, North Face, Patagonia - Provides quality and inspires trust - Technology can play a major role in strengthening/de-strengthening a brand - Example: Viral marketing:
Sources of Switching Costs
1. Learning costs: Switching technologies may require an investment in learning a new interface and commands. - Apple vs. Microsoft 2. Information and data: Users may have to reenter data, convert files or databases, or may even lose earlier contributions on incompatible systems. - Dropbox vs. OneDrive 3. Financial commitment: Can include investments in new equipment, the cost to acquire any new software, consulting, or expertise, and the devaluation of any investment in prior technologies no longer used. - More money, more problems 4. Contractual commitments: Breaking contracts can lead to compensatory damages and harm an organization's reputation as a reliable partner. 5. Search costs: Finding and evaluating a new alternative costs time and money. - I have to find it?? Too lazy 6. Loyalty programs: Switching can cause customers to lose out on program benefits. Think frequent purchaser programs that offer "miles" or "points" (all enabled and driven by software). Starbucks Rewards
What is the evolution of MIS today?
Wearables, Internet of Things, BIG DATA, 3D Printing, Analytics, Healthcare IT, Security Concerns Remember: This is where YOU come in! We control the future.
What are the four critical components of RBV?
1. Valuable 2. Rare 3. Imperfectly imitable (tough to imitate) 4. Non-substitutable
What is the point of MIS with it's timeline in history? (1970's)
A need to better understand the use of computers in organizations Improve the handling and use of information and to thereby improve organizational decision-making Examples: Computerizing the accounting and payroll functions Remember: Businesses and business functions were not RELIANT on technology at this point
Network Effects
A product or service becomes more valuable as more people use it. - Facebook with no one? - Instagram with no one? - Tweeting to no one? NO FUN!!
What are some examples of software from the 1990's?
AOL, Windows 95, Grand Theft Auto, etc.
What is a system of information?
An information system is any organized system for the collection, organization, storage and communication of information. The term is also sometimes used in more restricted senses to refer to only the software used to run a computerized database or to refer to only a computer system.
Resources for attaining a competitive advantage:
Brand, Scale, Switching Costs, Differentiation, Network Effects, Distribution Channels
Technology's role in several resources firms can draw on to achieve a competitive advantage:
Brand, scale, data and switching cost assets, differentiation, network effects, and distribution channels
Netflix and Brand
Brands are built through customer experience. Netflix wasn't simply a provider of good customer experience; it was often ranked the best. The firm was top in the American Customer Satisfaction Index (ACSI) and Nielsen rankings, while ratings agency ForeSee named Netflix the number one e-commerce site in eleven out of twelve surveys conducted (placing it ahead of Apple and Amazon). Durable brands are built through customer experience, and technology lies at the center of the Netflix top satisfaction ratings and hence the firm's best-in-class brand strength.
Collaborative Filtering, Cinematch
Cinematch is a software technology known as collaborative filtering. These systems monitor trends among customers and use this data to personalize an individual customer's experience. Firms use collaborative filtering systems to customize webpages and make all sorts of recommendations, including products, music, and news stories.
Distribution Channels
Distribution Channels: the path through which products or services get to customers - Technology opens up new opportunities for business owners to reach customers - Example: Book Sellers on Amazon; eBay
What does data analysis do for Netflix?
Each user's Netflix screen is the result of analyzing terabytes of data. Data analysis doesn't just drive the collaborative filtering software for user recommendations; it's also used to tailor and improve the experience over time. Like Google, Amazon, and many other firms, Netflix will roll out new features to a subset of users, running an A/B test to determine how the new stacked up against the old. If feature A is better than feature B, then A will be rolled out to everyone. Metrics used to evaluate the slew of constant tests include sign-up, viewing, and retention rates.
Switching Costs
Exist when consumers incur an expense to move from one product or service to another.
How winners anticipate the fast follower problem:
Exists when savvy rivals watch a pioneer's efforts, learn from their successes and missteps, then enter the market quickly with a comparable or superior product at a lower cost
Sustainable Competitive Advantage
Financial performance that consistently outperforms their industry peers
What is Inditex? How did Inditex leverage a technology-enabled strategy to become the world's largest fashion retailer?
Inditex has leveraged a strategy highly based around the use of technology to create many very successful businesses within its empire. By using vertical integration, Inditex is able to keep huge parts of its production process in house, cutting down costs for both producers and consumersand saving time, allowing for rapid production, profitability, growth and shipments of high quality inexpensive products.
What was the computer in the 1970's for MIS? What was the model, year, price, and the storage (words)?
HP 1000 - 21MX E-Series Year: 1976 Price: $5850 Storage: 1,048,576 words
Resource Based View (RBV) of competitive advantage
If a firm is to maintain sustainable competitive advantage, it must control a set of exploitable resources that have ALL four critical characteristics
What challenges does Zara face going forward?
It is evident that Zara has found their sustainable competitive advantage, what they must do in the years to come is be aware of the operations vulnerabilities they could face. They need to be willing to accept the fact that their company is not bulletproof and there are still risks that could harm the company. Such as: weather or natural disasters, terrorism, labor strife, knowing that they could be more susceptible to rising transportation costs, and the gamble that living in the fashion industry can be. As Gap found, if you make something that consumers do not appreciate, this could be a turning point leading to a downfall of the company. Zara also needs to constantly be aware of changing technology trends, and stay on top of that, as right now their knowledge and use of technology is one of their biggest advantages in the market place. All in all, going forward, management needs to be aware of changing technologies, business limitations and consumer desires to continue on their path of being the "game changing crown jewel in the multibrand empire of the Inditex corp."
Viral Marketing
Leveraging consumers can often be enlisted to promote a product or service Example of successful viral marketing: Old Spice Man, and LG: So Real It's Scary
Long Enough Tail
Licensing issues will make it impossible to create a long tail as long as it is enjoyed in the DVD-by-mail business. Its new model is about providing a "long enough tail" to attract and retain subscribers.
What is MIS?
Management Information Systems
What is MIS when it come to Business Foundation?
Management, Economics, Accounting, Marketing, Finance
Differentiation
Many firms leverage technology to differentiate their goods and services that are pretty much the same Amazon - uses DATA to differentiate itself - browsing records, purchase patterns, and product ratings to present a custom home page featuring products that the firm hopes the visitor will like Netflix: Uses previous movies and your ratings to suggest movies for you; HBO Go does not
What was the evolution of MIS in the 2000's?
Mobile, Web 2.0, iPod, Smartphones, Tablets, Social Media, Cloud Computing, Open Source Software, Security Concerns Remember: There is no escaping technology
Moore's Law
Moore's law refers to an observation made by Intel co-founder Gordon Moore in 1965. He noticed that the number of transistors per square inch on integrated circuits had doubled every year since their invention. Moore's law predicts that this trend will continue into the foreseeable future. This phenomenon of "faster, cheaper" computing is often referred to as Moore's Law, after Intel cofounder, Gordon Moore. Moore didn't show up one day, stance wide, hands on hips, and declare "behold my law," but he did write a four-page paper for Electronics Magazine in which he described how the process of chip making enabled more powerful chips to be manufactured at cheaper prices. And as mentioned earlier, some say Moore's Law's doubling happens closer to every two and a half years. (18-24 months) - Every two years, technology gets efficient and smaller, but will eventually hit the wall of Moore's law.
The Importance of Data and Netflix
Netflix also keeps customers happy in brand-building ways by leveraging its massive and growing arsenal of user data. Data is collected when customers rate movies they've seen, and this data on customer likes and dislikes is fed into a proprietary Netflix recommendation system called Cinematch.
Long Tail and Long Enough Tail
Netflix appeal also came from the scale of the firm's entertainment selection. A traditional video store would stock a selection of roughly 3,000 DVD titles on its shelves. Netflix, however, offered its customers over 125,000 unique DVD titles. The battle over who had the better selection wasn't even close. This nearly limitless selection allows Internet retailers to leverage what is often called the long tail (the tail refers to the large number of products unavailable through conventional retail stores, see Figure 4.1 "The Long Tail"). Customers saw advantage in having vast choice. Roughly 75 percent of DVDs Netflix shipped were from back-catalog titles, versus the 70 percent of Blockbuster rentals that came from new releases. [4] While some debate the size of the profitable tail, two facts are critical to keep above this debate: (1) selection attracts customers, and (2) the Internet allows large-selection inventory efficiencies that offline firms can't match.
The data advantage; The data asset with examples
Netflix has one very critical asset that is far stronger than what rivals, especially cable television networks, can assemble: a growing and exquisitely detailed treasure trove of data. This data asset is used to make more accurate recommendations, improve user interface design, and help the firm determine the appropriate cost for acquiring content, and it can even shape creative decisions in original program offerings. The data gathered via streaming can be more revealing than ratings received via DVD-by-mail. Even if someone doesn't rate a given title, if they binge-watch multiple episodes, Netflix has a pretty good indicator that the user likes the show. The reverse is usually true for the unrated property that a user streamed for the first fifteen minutes and never came back to. [40] In the DVD-by-mail days, the firm had no idea if you'd actually watched unrated shows you'd received, watched them multiple times, finished watching titles you started, and so forth. Once captured, this data can be fed into the firm's Cinematch collaborative filtering software to further group user tastes and help subscribers discover the content most likely to delight them. Netflix possesses not only several hundred genres, or even several thousand, but also over seventy-six thousand (and climbing) unique ways to describe different types of movies. While Netflix does employ a team of "entertainment classification experts" to initially tag and rate movie characteristics, the real magic happens during data analysis. [41] Each user's Netflix screen is the result of analyzing terabytes of data. Every recent click, view, review, early abandon, and guide page view, as well as other data, is considered in order to identify the content the firm believes users will most likely want to see. Some 75 to 80 percent of what people watch on the service comes from Netflix recommendations, not search. [42]
Discuss Zara's strategic use of information technology. Specifically, discuss how IT influences design and product offerings, manufacturing, inventory, logistics, and marketing. Use concepts we discussed on Monday here.
One of Zara's biggest advantages is the way the company uses its information technology. In Zara's inbound logistics and operations (turning inputs into products or services) their advantages come from their highly integrated company produces nearly 60% in house. Another big component in Zara's information technology is their marketing and sales. Zara uses touchscreens to instantaneously record customer feedback and concerns, along with the data gathering they do to gain insight when the doors close, as they are able to spot trends by what items were not sold, or sold out of. Zara also relies on young, new, trendy students fresh from design school to help them constantly have a new view on trends and current fashion. Along with their marketing comes the RFID which lets Zara know where products are. As staff are able to use the tracking devices to see where a product is, whether it is in store, in shipment or sold out. This technology allows for more interaction with the customers which provides them with a great experience, tailored (quite literally) to their fashion desires.
What can blast through Moore's Law wall?
One way to address the problem of densely-packed, overheating chip designs is with (multicore microprocessors), made by putting two or more lower power processor cores (think of a core as the calculating part of a microprocessor) on a single chip. Philip Emma, IBM's Manager of Systems Technology and Microarchitecture, offers an analogy. Think of the traditional fast, hot, single-core processors as a three hundred-pound lineman, and a dual-core processor as two 160-pound guys. Says Emma, "A 300-pound lineman can generate a lot of power, but two 160-pound guys can do the same work with less overall effort." [5] For many applications, the multicore chips will outperform a single speedy chip, while running cooler and drawing less power. Multicore processors are now mainstream. Today, most smartphones, PCs, and laptops sold have at least a two-core (dual-core) processor. The Microsoft Xbox One and PlayStation 4 both have eight core processors. Intel has even demonstrated chips with upwards of fifty cores. Multicore processors can run older software written for single-brain chips. But they usually do this by using only one core at a time. To reuse the metaphor above, this is like having one of our 160-pound workers lift away, while the other one stands around watching. Multicore operating systems can help achieve some performance gains. Versions of Windows or the Mac OS that are aware of multicore processors can assign one program to run on one core, while a second application is assigned to the next core. But in order to take full advantage of multicore chips, applications need to be rewritten to split up tasks so that smaller portions of a problem are executed simultaneously inside each core. Writing code for this "divide and conquer" approach is not trivial. In fact, developing software for multicore systems is described by Shahrokh Daijavad, software lead for next-generation computing systems at IBM, as "one of the hardest things you learn in computer science." [6] Microsoft's chief research and strategy officer has called coding for these chips "the most conceptually different [change] in the history of modern computing." [7] Despite this challenge, some of the most aggressive adaptors of multicore chips have been video game console manufacturers. Video game applications are particularly well-suited for multiple cores since, for example, one core might be used to render the background, another to draw objects, another for the "physics engine" that moves the objects around, and yet another to handle Internet communications for multiplayer games. Another approach that's breathing more life into Moore's Law moves chips from being paper-flat devices to built-up 3-D affairs. By building up as well as out, firms are radically boosting speed and efficiency of chips. Intel has flipped upward the basic component of chips—the transistor. Transistors are the supertiny on-off switches in a chip that work collectively to calculate or store things in memory (a high-end microprocessor might include over two billion transistors). While you won't notice that chips are much thicker, Intel says that on the miniscule scale of modern chip manufacturing, the new designs are 37 percent faster and half as power hungry as conventional chips.
How do winners use technology?
Operational effectiveness, fast follower problem, strategic positioning.
How winners focus on strategic positioning:
Performing different activities from those of rivals, or the same activities in a different way (In other words, technology can play a critical role in creating and strengthening strategic differences)
How winners focus on operational effectiveness:
Performing the same tasks better than rivals perform them
What about background in technology competencies?
Programming, database, analytics, telecoms
Scale
Scale advantages: Advantages related to a firm's size and growing in size. Economies of scale: the cost of an investment can be spread across increasing units of production or in serving a grown customer base. In other words: when you do something so often, and do it so well that you figure out ways to do it better and cheaper than anyone else Technology often lowers economies of scale and is said to be scalable
Why Study Netflix?
Studying Netflix gives us a chance to examine how technology helps firms craft and reinforce a competitive advantage. While the DVD-by-mail business is dying, many will still want to read this section for key learning. Topics covered in this section include how technology played a starring role in developing assets such as scale, brand, and switching costs that combined to repel well-known rivals and place Netflix atop its industry. This section also introduces important business and technology concepts such as the long tail, collaborative filtering, and the value of the data asset. In the second part of this case, we examine Netflix, the sequel, and the firm's transition to video streaming. This section looks at the very significant challenges the firm faces as its primary business shifts from shipping the atoms of DVDs to sending bits over the Internet. We'll see that a highly successful firm can still be challenged by technical shifts, and we'll learn from Netflix's struggles as well as its triumphs. This section gives us an opportunity to examine issues that include digital goods, licensing, content creation, international growth, supplier power, crowdsourcing, platform competition, legal and regulatory issues, and technology infrastructure. We'll also look at the kinds of competitive advantages that Netflix is crafting now that it's fully committed to a video streaming future.
What is supercomputing and how can companies use supercomputers?
Supercomputers are computers that are among the fastest of any in the world at the time of their introduction. [1] Supercomputing was once the domain of governments and high-end research labs, performing tasks such as simulating the explosion of nuclear devices, or analyzing large-scale weather and climate phenomena. But it turns out with a bit of tweaking, the algorithms used in this work are profoundly useful to business. Corporate use of supercomputing varies widely. United Airlines used supercomputing to increase the number of flight-path combinations for scheduling systems from 3,000 to 350,000. Estimated savings through better yield management? Over $50 million! CIBC (the Canadian Imperial Bank of Commerce), one of the largest banks in North America, uses supercomputing to run its portfolio through Monte Carlo simulations that aren't all that different from the math used to simulate nuclear explosions. The muscular mathematics CIBC performs allows the firm to lower capital on hand by hundreds of millions of dollars, a substantial percentage of the bank's capital, saving millions a year in funding costs. Also noteworthy: the supercomputer-enabled, risk-savvy CIBC was relatively unscathed by the subprime crisis.
What are the five components that make up the system?
System of information consists of Hardware, Software, Data, Networks, and People!
What does it mean that technology does not equal systems (see Prada lesson)? (Zara)
Technology alone cannot make a company successful. They must integrate the entire Information System in order for technology to play a positive role in their business. With the example of Prada, they had the hardware and software there, they just didn't make said technology inclusive for the constant flow of Data arriving in and out of store, and the technologies were not user friendly for the Procedures and People using them. Allowing Prada to have one disastrous run in with technology.
Netflix and Scale
The high degree of customer satisfaction that Netflix enjoyed is tightly linked with the firm's size-based advantages. Yes, even though Netflix was the upstart, it managed to gain relevant scale greater than Blockbuster (even though that firm had 7,800 stores) and Walmart (with its nation-leading sales might). It did so by building and leveraging an asset that neither competitor had: a nationwide network of fifty-eight highly automated distribution centers that collectively could deliver DVDs overnight to some 97 percent of the US population. Drop a disc in the mail, and in most cases you'd get a new one the next day. No one else had a comparable network at launch, so the lack of scale among rivals harmed their customer experience, weakening their brand.
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. Massive collections of computers running software that allows them to operate as a unified service also enable new service-based computing models, such as software as a service (SaaS) and cloud computing. In these models, organizations replace traditional software and hardware that they would run in-house with services that are delivered online. Google, Microsoft, Salesforce.com, and Amazon are among the firms that have sunk billions into these Moore's Law-enabled server farms, creating entirely new businesses that promise to radically redraw the software and hardware landscape while bringing gargantuan computing power to the little guy. - The internet over the internet, it is all connected (netflix)
Net neutrality
The principle that all Internet traffic should be treated equally and that ISPs should not discriminate, slow down access, or charge differentially by user, content, site, platform, application, type of attached equipment, or modes of communication
Atoms to Bits
The shift from atoms to bits is realigning nearly every media industry. Newspapers struggle as readership migrates online and once-lucrative classified ads and job listings shift to the bits-based businesses of Craigslist, Monster.com, and LinkedIn. Apple and Spotify rule the new world of music without selling a single CD, while most of the atom-selling "record store" chains of the past are bankrupt. Amazon jumped into the atoms-to-bits shift when it developed the Kindle digital reader. There is some potential upside to the Netflix model as it shifts from mailing atoms to streaming bits, including the ability to eliminate a huge chunk of costs associated with shipping and handling. But just about everything in the streaming business is different: content availability, content acquisition costs, the legal and regulatory environments, potential opportunities for revenue and expansion, potential partners, competitors, and their motivation. But the "First Sale Doctrine" applies only to the atoms of the physical disc, not to the bits needed in streaming, so Netflix can't offer Internet streaming without separate streaming licenses. [15] That's a big problem for Netflix. Licensing costs are skyrocketing, and some firms are outright refusing to make their content available for streaming on Netflix.
Characteristics of Disruptive innovations and examples; importance for a manger
The term disruptive technologies is a tricky one, because so many technologies create market shocks and catalyze growth. Lots of press reports refer to firms and technologies as disruptive. But there is a very precise theory of disruptive technologies (also referred to as disruptive innovation—we'll use both terms here) offered by Harvard professor Clayton Christensen that illustrates giant-killing market shocks, allows us to see why so many once-dominant firms have failed, and can shed light on practices that may help firms recognize and respond to threats. In Christensen's view, true disruptive technologies have two characteristics that make them so threatening. First, they come to market with a set of performance attributes that existing customers don't value. Second, over time the performance attributes improve to the point where they invade established markets. These attributes are found in many innovations that have brought about the shift from analog to digital. The first digital cameras were terrible: photo quality was laughably bad (the first were only black and white), they could only store a few images and did so very slowly, they were bulky, and they had poor battery life. It's not like most customers were lined up saying "Hey, give me more of that!" Much the same could be said about the poor performance of early digital music, digital video, mobile phones, tablet computing, and Internet telephony (Voice over IP, or VoIP), just to name a few examples. But today all of these digital products are having a market-disrupting impact. Digital cameras have all but wiped out film use, the record store is dead, mobile phones for many are their only phone, tablets are selling faster than laptops, Internet phone service is often indistinguishable from conventional calls, and Skype can be considered the world's largest long-distance phone company. [5] All of these changes were enabled by fast/cheap technologies, largely by the trends we see in the chart from the prior chapter labeled Those running big firms fail to see disruptive innovations as a threat not because they are dumb but, in many ways, because they do what executives at large, shareholder-dependent firms should do: they listen to their customers and focus on the bottom line. And because of the first characteristic mentioned, the majority of a firm's current customers don't want the initially poor-performing new technology. The most disruptive technologies also often have worse margins than the initially dominant incumbent offerings. Since these markets don't look attractive, big firms don't dedicate resources to developing the potential technology or nurturing the needs of a new customer base. Your best engineers are likely going to be assigned to work on cash-cow offerings, not questionable new stuff. This results in a sort of blindness created by an otherwise rational focus on customer demands and financial performance. By the time the new market demonstrates itself, start-ups have been at it for quite some time. They have amassed expertise and often benefit from increasing scale and a growing customer base. The brands of firms leading in developing disruptive innovations may also now be synonymous with the new tech. If this happens, big firms are forced to play catch-up, and few ever close the gap with the new leaders. So how can a firm recognize potentially disruptive innovations? Paying attention to the trajectory of fast/cheap technology advancement and new and emerging technologies is critical. Seeing the future involves removing short-sighted, customer-focused, and bottom-line-obsessed blinders. Having conversations with those on the experimental edge of advancements is key. Top-tier scientific researchers and venture capitalists can be particularly good sources for information on new trends. Increasing conversations across product groups and between managers and technologists can also be helpful. It's common for many firms to regularly rotate staff (both management and engineering) to improve idea sharing and innovation. Facebook, for example, requires employees to leave their teams for new assignments at least once every eighteen months. [6] Note that many disruptive firms were started by former employees of the disrupted giants. The founders of Adobe, for example, came from Xerox; Apple's founders worked for Hewlett-Packard; Marc Benioff worked for Oracle before founding software-as-a-service giant Salesforce.com. Employees who feel so passionate about a trajectory for future technology that they are willing to leave the firm and risk it all on a new endeavor may be a signal that a development is worth paying attention to. But all these conversations will simply expand a manager's radar. They don't necessarily offer insight on how to deal with potentially disruptive innovations once spotted. Navigating this next step is really tough. There's no guarantee that a potentially disruptive innovation will in fact become dominant. Trying to nurture new technology in-house is also a challenge. Top tech talent will often never be assigned to experimental products, or they may be pulled off emerging efforts to work on the firm's most lucrative offerings if the next version of a major product is delayed or in need of staff. And as disruptive technologies emerge, by definition they will eventually take market share away from a firm's higher-margin incumbent offerings. The result of the transition could include losses, contracting revenues, and lower profits—a tough thing for many shareholders to swallow. Christensen suggests a few tactics to navigate the challenges. One is that a firm can build a portfolio of options on emerging technologies, investing in firms, start-ups, or internal efforts that can focus solely on what may or may not turn out to be the next big thing. An option is a right, but not the obligation, to make an investment, so if a firm has a stake in a start-up, it may consider acquiring the firm; or if it supports a separate division, it can invest more resources if that division shows promise. It's also important that these experimental efforts are nurtured in a way that is sufficiently separate from the parent—geographical distance helps, and it's critical to offer staff working on the innovation a high degree of autonomy. Christensen uses the analogy of the creosote bush to explain what often happens to new efforts in big firms that don't break out potentially disruptive innovations. The desert-dwelling creosote bush excretes and drops a toxin that kills nearby rival plants that might otherwise siphon away resources like water or soil nutrients. Threatened managers can act just like the bush—they'll pull high-quality engineers off emerging projects if a firm's top offerings need staff to grow. Lucrative old tech has a credible case for big budget allocations and is first in line when planning corporate priorities. But by nurturing potentially disruptive innovations in protected units (or even as separate firms), engineers and managers focusing on new markets can operate without distraction or interference from resource-coveting or threatened staff on other projects. This kind of separation can be vital for start-ups, but some firms maintain arms-length autonomy even as their investment in potential disruptors grows quite large. East-coast storage giant EMC is the majority owner of Silicon Valley's multibillion-dollar VMware but has left the latter largely free to innovate, nurture its customer base, and grow its own brands, even as some of the firm's products and partners threaten parent core products.
How winners invest in techniques:
They do things to improve quality, lower cost, and design efficient customer experiences
What two revolutionary changes with MIS occurred in the 1980's?
Two revolutionary changes: - the personal computer revolution - the rise of digital networking architectures to interconnect computers of all sizes Remember: Computers are becoming connected, and more slowly integrated into everything we do, both at home and in the office
What history occurred with MIS in the 1990's?
User-friendly Software, Better Processors, Computer Video Games, MP3s, the Internet, High Speed Internet, and the World Wide Web Remember: Computing and networking become ubiquitous Computers and the Internet reach every nook and cranny of home and businesses and provide critical support for decision-making at all levels of modern organizations no longer possible to say that the destinies of business and governmental organizations are independent from their successes or failures in information technology
FreshDirect Q/A
What is FreshDirect? - An online grocer that delivers to residences and offices in the New York City metropolitan area. What NYC-based problems did FreshDirect focus on? What was FreshDirect's solution to those problems? - List and discuss briefly several reasons for FreshDirect's competitive advantage. - Does FreshDirect have a sustainable competitive advantage?? - Discuss how technology plays a role in FreshDirect's business model. - Why can't traditional grocers fully copy the FreshDirect model? - Do you think a similar business would work in Bellingham? Seattle? Why or why not? -
Crowdsourcing
While Netflix is widely considered to have a best-in-class collaborative filtering engine in Cinematch, the firm also realizes that it has no monopoly on math. So the firm previously ran a competition, known as the Netflix Prize, ponying up $1 million to the first team that could improve Cinematch scores by 10 percent. For contest purposes, Netflix released a subset of ratings data, stripped of customer identity, [85] and over 30,000 teams from over 170 countries eventually entered the contest. The winning team consisted of engineers that entered the competition on separate teams. It included a pair of coders from Montreal; two US researchers from AT&T Labs; a scientist from Yahoo! Research, Israel; and a couple of Austrian college students turned consultants. [86] It's safe to say that without the Netflix Prize, these folks would likely never have met, let alone collaborated. The Netflix Prize is an example of crowdsourcing, a technique in which a firm states a problem it would like solved, the reward it will provide, and then makes this available to a broader community in the form of an open call. While Netflix did not implement the final winning algorithm as introduced, it had already begun incorporating changes based on learning from submissions even before the contest was complete. [87] The effort was also a public relations bonanza, with articles on the effort (and Netflix superior Cinematch software) appearing in major news and business publications worldwide. The positive crowdsourcing experience has led Netflix to run several other contests, including one rewarding hackers for improving the firm's open-source cloud tools. Not only does the firm benefit from code submissions; the contest also has a recruiting payoff. Says one manager about these efforts, "We can see people who already know our code base and are doing interesting things." [88]
Netflix and The Big Customer Base
While Netflix's warehouse network and product selection were greater than those of rivals, these assets could be bought by a competitor with a big wallet. Says Netflix's Vice President of Operations, "Anyone can replicate [our] operations if they wish. It's not going to be easy. It's going to take a lot of time and a lot of money." [5] The yearly cost to run a Netflix-comparable nationwide delivery infrastructure is about $300 million. [6] This is where another critical component of scale comes in—the size of the firm's customer base. In Chapter 2 "Strategy and Technology: Concepts and Frameworks for Understanding What Separates Winners from Losers" we learned that scale economies are achieved by firms that leverage the cost of an investment across increasing units of production. If the entry price for getting into the national DVD-by-mail game is $300 million, but one firm has far more customers than the other (see Figure 4.2 for estimates in the one-time Netflix versus Blockbuster competition), then the bigger firm has a better cost structure and better profit prospects and should be able to offer better pricing. Walmart had the cash to compete with Netflix but decided doing so would require a massive investment and extended periods of loss to unseat the early-moving leader, so Walmart pulled the plug on their DVD-by-mail effort. Blockbuster decided to fight to the death—and lost. The firm never had the necessary threefold scale advantages (distribution centers, selection, and customers) needed to create a competitive DVD-by-mail business.
Is Moore's Law dead? Why or why not?
While shrinking silicon pathways creates better chips, packing pathways tightly together creates problems associated with three interrelated forces—size, heat, and power—that together are threatening to slow down Moore's Law's advance. When you make processors smaller, the more tightly packed electrons will heat up a chip—so much so that unless today's most powerful chips are cooled down, they will melt inside their packaging. To keep the fastest computers cool, many PCs, laptops, and video game consoles need fans, and most corporate data centers have elaborate and expensive air conditioning and venting systems to prevent a meltdown. The need to cool modern data centers draws a lot of power and that costs a lot of money. And while these powerful shrinking chips are getting hotter and more costly to cool, it's also important to realize that chips can't get smaller forever. At some point Moore's Law will run into the unyielding laws of nature. While we're not certain where these limits are, chip pathways certainly can't be shorter than a single molecule, and the actual physical limit is likely larger than that. Get too small and a phenomenon known as quantum tunneling kicks in, and electrons start to slide off their paths. Yikes! While the death of Moore's Law has been predicted for years, scientists continue to squeeze advancement through new manufacturing techniques. Many think that while Moore's Law has celebrated its fiftieth birthday, it may not make it to sixty. Overheating with the smaller chips (note 7, for example) can happen to devices which is an example of the death of the Moore's Law.
Explanation of these Components
Without value, no one cares what you've got. Without rareness, you don't have something unique. If others can copy what you have, or others can replace it with a substitute, then any seemingly advantageous differences will be undercut.
More Notes On Zara
Zara definitely follows the RBV (resource based view of competitive advantage) As because their products are so frequently produced following the new and current trends, this makes them highly valuable to people trying to stay "in" with the current fashion. Their products are also rare, as fashion trends change constantly, their products are released in "limited runs" which encourages consumers to buy them quickly or they will probably never see that product again. Thirdly, their business infrastructure is most definitely hard to imitate, as they keep so much of their production in house that Zara produces nearly 40% of their own fabric. Finally, Zara's products are nonsubstitutable, especially in an ever changing market, Zara's ability to produce current trends more rapidly than its competitors allows for little ability for substitution.
Why Study Zara?
Zara is a unique ever expanding game changer in the world of Business. Its high quality fashion at inexpensive prices along with their great understanding and use of technology provides for a game changer in the world of business. Especially in the world of fashion, their rapid production is a huge advantage, allowing them to stay in style ans season with the new constantly changing trends. This makes customers far more likely to visit the stores more frequently than clothing companies with slower production which often leaves them with excess "out of season" clothes.
Competitive Advantage
a condition or circumstance that puts a company in a favorable or superior business position.
MIS person typically has
learned about both the business of providing information technology services to organizations and the technological underpinnings necessary to do this properly speaks both the languages of business and the languages of the various technologies involved the boundary between the business and technology groups of the organization In my experience, Translates human to geek and geek to human.