Lesson Information systems for competitive advantage present the content: enable organizational through information systems; organization can use is to achieve competitive advantage; from organizational strategy to information systems structure, to competitive advantage.
Chapter 2: Information Systems for Competitive advantage nga.lethiquynh@ueh.edu.vn Study questions Q1 How to enable Organizational through Information Systems? Q2 How organization can use IS to achieve competitive advantage? ► From Organizational Strategy to Information Systems Structure, to Competitive Advantage BUSINESS INFORMATION TECHNOLOGY Q1 How to enable Organizational through Information Systems? BUSINESS INFORMATION TECHNOLOGY Decision-Making Levels of an Organization 2-4 Source: textbook [2], page 80 BUSINESS INFORMATION TECHNOLOGY Operational level ► Routine, day-to-day business process ► Decision: structured decisions ► ► Procedures are specified in advance ► Can be programed IS: are used to increase Efficiency (faster, lower cost) BUSINESS INFORMATION TECHNOLOGY Managerial level ► ► Functional managers (e.g marketing, finance, manufacturing managers) focus on: ► monitoring operational-level activities and providing info to higher levels ► Utilizing organizational resources to increase Effectiveness (goals/tasks to accomplished well) Decision: semi-structured decisions ► Solutions/problems are not clear-cut, require judgment ► Procedures can be specified in advance, but not to the extent where a specific recommendation can be made BUSINESS INFORMATION TECHNOLOGY Executive level ► Focus on long-term strategic questions ► ► Which products to produce, which countries to compete in, what organizational strategy for follow Decision: unstructured decisions ► Complex and non-routine ► Few or no Procedures can be specified in advance BUSINESS INFORMATION TECHNOLOGY Systems For Different Levels of Management • Transaction processing systems: • • Management information systems and decision-support systems: • • Keep track of basic activities and transactions of organization (e.g., sales, receipts, cash deposits, payroll, credit decisions, flow of materials in a factory) Help with monitoring, controlling, decision making, and administrative activities Executive support systems: • Help address strategic issues and long-term trends, both in firm and in external environment BUSINESS INFORMATION TECHNOLOGY Transaction Processing Systems (TPS) ► Operational level ► ► Purpose: ► Processing of business events and transactions ► Increase efficiency ► Automation ► Lower costs ► Increased speed and accuracy Examples: ► Payroll processing ► Sales and order processing ► Inventory management ► Product purchasing, receiving, and shipping ► Accounts payable and receivable BUSINESS INFORMATION TECHNOLOGY Architecture of a TPS Source: Textbook [2] BUSINESS INFORMATION TECHNOLOGY 10 What Five Forces Determine Industry Structure? Competitive Forces • Competition from vendors of substitutes • Competition from new competitors • Competition from existing rivals Bargaining Power Forces • Bargaining power of suppliers • Bargaining power of customers BUSINESS INFORMATION TECHNOLOGY 30 Use 5-forces Model to Identify Sources of Strong Competition Source: textbook[1], pg 69 BUSINESS INFORMATION TECHNOLOGY 31 How Does Analysis of Industry Structure Determine Competitive Strategy? Porter's Four Competitive Strategies Source: textbook [1], pg 70 BUSINESS INFORMATION TECHNOLOGY 32 Business – IS alignment ► To be effective goals, objectives, culture, and activities must be consistent with strategy ► In MIS, this means all information systems must reflect and facilitate the organization's competitive strategy BUSINESS INFORMATION TECHNOLOGY 33 34 How Does Competitive Strategy Determine Value Chain Structure? Linkag es Source: textbook [1], pg 71 BUSINESS INFORMATION TECHNOLOGY Task Descriptions for Primary Activities of the Value Chain Source: textbook [1], pg 72 BUSINESS INFORMATION TECHNOLOGY 35 How Do Business Processes Generate Value? Source: textbook [1], pg 74 BUSINESS INFORMATION TECHNOLOGY 36 Improved Material Ordering Process Source: textbook[1], pg 75 BUSINESS INFORMATION TECHNOLOGY 37 How Does Competitive Strategy Determine Business Processes and the Structure of IS? Low-Cost Rental Value Chain Source: textbook [1], pg 78 BUSINESS INFORMATION TECHNOLOGY 38 High-Service Rental Value Chain Source: textbook [1], pg 78 BUSINESS INFORMATION TECHNOLOGY 39 40 Source: textbook [1], pg 79 BUSINESS INFORMATION TECHNOLOGY How Does IS Provide Competitive Advantages? Principles of Competitive Advantage Source: textbook [1], pg 79 BUSINESS INFORMATION TECHNOLOGY 41 Summary Q1 How to enable Organizational through Information Systems? Q2 How organization can use IS to achieve competitive advantage? ► From Organizational Strategy to Information Systems Structure, to Competitive Advantage BUSINESS INFORMATION TECHNOLOGY 42 Additional Resources ► Management Information Systems: https://www.youtube.com/watch?v=qi LXJ0lhN2g ► Decision support system: https://www.youtube.com/watch?v=Tq yqJGHymkQ BUSINESS INFORMATION TECHNOLOGY 43 ... through Information Systems? Q2 How organization can use IS to achieve competitive advantage? ► From Organizational Strategy to Information Systems Structure, to Competitive Advantage BUSINESS INFORMATION. .. value? How does competitive strategy determine business processes and the structure of information systems? How information systems provide competitive advantages? BUSINESS INFORMATION TECHNOLOGY... achieve competitive advantage? ► From Organizational Strategy to Information Systems Structure, to Competitive Advantage BUSINESS INFORMATION TECHNOLOGY 42 Additional Resources ► Management Information