BUSINESS DRIVEN TECHNOLOGY UNIT 1: Achieving Business Success Through Information Technology

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BUSINESS DRIVEN TECHNOLOGY

UNIT 1: Achieving Business Success Through Information Technology

OPENING CASEHow Levi’s Got Its Jeans into Wal-Mart

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Unit One

• The chapters in this unit include: – Chapter One – Business Driven Technology Overview– Chapter Two – Identifying Competitive Advantages– Chapter Three – Strategic Initiatives for Implementing

Competitive Advantages– Chapter Four – Measuring the Success of Strategic

Initiatives – Chapter Five – Organizational Structures That Support

Strategic Initiatives

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BUSINESS DRIVEN TECHNOLOGY

Chapter One: Business Driven Technology

Overview

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LEARNING OUTCOMES

1.1 Compare management information systems (MIS) and information technology (IT)

1.2 Describe the relationships among people, information technology, and information

1.3 Describe why people at different levels of an organization have different information needs

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CHAPTER ONE OVERVIEW

• Provides an overview of the units in the text

• Introduces important business and technology concepts

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UNIT 1 – ACHIEVING BUSINESS SUCCESS THROUGH INFORMATION TECHNOLOGY

• Unit 1 introduces several business strategies including:– Porter’s Five Forces– Porter’s three generic strategies– Value chain analysis– Supply chain management– Customer relationship management– Enterprise resource planning– IT efficiency and IT effectiveness metrics– Organizational structures

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UNIT 1 – ACHIEVING BUSINESS SUCCESS THROUGH INFORMATION TECHNOLOGY

• Information technology (IT) – any computer-based tool that people use to work with information and support the information and information-processing needs of an organization

• Information technology is an important enabler of business success and innovation

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UNIT 1 – ACHIEVING BUSINESS SUCCESS THROUGH INFORMATION TECHNOLOGY

• Management information systems (MIS) – the function that plans for, develops, implements, and maintains IT hardware, software, and the portfolio of applications that people use to support the goals of an organization

• MIS is a business function, similar to Accounting, Finance, Operations, and Human Resources

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Types of Information Systems

Start

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UNIT 1 – ACHIEVING BUSINESS SUCCESS THROUGH INFORMATION TECHNOLOGY

• People use• Information technology to work with• Information

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UNIT 2 – MANAGING INFORMATION FOR BUSINESS INITIATIVES

• Unit 2 introduces:– Information quality– Databases– Database management systems– Data mining– Data warehouses

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UNIT 2 – MANAGING INFORMATION FOR BUSINESS INITIATIVES

• Organizations must manage information properly. That is, an organization must:

1. Determine what information it requires2. Acquire that information3. Organize the information in a meaningful fashion4. Assure the information's quality5. Provide software tools so that employees throughout

the organization can access the information they require

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UNIT 2 – MANAGING INFORMATION FOR BUSINESS INITIATIVES

• At the heart of all management information systems is a database and DBMS– Database – maintains information about various types

of objects (inventory), events (transactions), people (employees), and places (warehouses)

– Database management system (DBMS) – software through which users and application programs interact with a database

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UNIT 2 – MANAGING INFORMATION FOR BUSINESS INITIATIVES

• There are two primary ways that users obtain information from a database

1. Direct user interaction 2. Indirect user interaction

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UNIT 3 – ENHANCING BUSINESS DECISIONS

• Unit 3 introduces the role of IT in strategic decision making and covers:– Data marts– Data-mining tools– Digital dashboards– Supply chain management (SCM)– Customer relationship management (CRM)– Enterprise resource planning (ERP)

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UNIT 3 – ENHANCING BUSINESS DECISIONS

• Business intelligence, gained through OLTP and OLAP, enables organization to make strategic business decisions– Business intelligence – a broad, general term

describing information that people use to support their decision-making efforts

– Online transaction processing (OLTP) – the capturing of transaction and event information

– Online analytical processing (OLAP) – the manipulation of information to create business intelligence in support of strategic decision making

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Start

UNIT 3 – ENHANCING BUSINESS DECISIONS

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UNIT 3 – ENHANCING BUSINESS DECISIONS

• Organizational employees have unique information processing and analyzing needs

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UNIT 3 – ENHANCING BUSINESS DECISIONS

• Many organizations use data warehouses and data-mining tools to support strategic decision making– Data warehouse – a logical collection of information –

gathered from many different operational databases – that supports business analysis activities and decision-making tasks

– Data-mining tools – use a variety of techniques to find patterns and relationships in large volumes of information and infer rules from them that predict future behavior and guide decision making

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UNIT 4 – CREATING COLLABORATIVE PARTNERSHIPS IN BUSINESS

• Unit 4 focuses on IT support for collaborative partnerships, both internal to an organization and external with its business partners and suppliers

• Unit 4 covers:– Collaboration systems– Information partnerships– Outsourcing

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UNIT 4 – CREATING COLLABORATIVE PARTNERSHIPS IN BUSINESS

• Organizations create and use teams, partnerships, and alliances to:– Undertake new initiatives– Address both minor and major problems– Capitalize on significant opportunities

• Organizations create teams, partnerships, and alliances both internally with employees and externally with other organizations

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UNIT 4 – CREATING COLLABORATIVE PARTNERSHIPS IN BUSINESS

• Collaboration system – supports the work of teams by facilitating the sharing and flow of information

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UNIT 4 – CREATING COLLABORATIVE PARTNERSHIPS IN BUSINESS

• Organizational collaboration systems include:– Groupware –supports team interaction and dynamics

including calendaring, scheduling, and videoconferencing

– Document management systems (DMS) – supports the electronic capturing, storage, distribution, archival, and accessing of documents

– Knowledge management systems (KMS) – supports the capturing and use of organizational “know how”

– Project management software – supports long-term and day-to-day management and execution of a project

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UNIT 4 – CREATING COLLABORATIVE PARTNERSHIPS IN BUSINESS

• Organizations form alliances and partnerships with other organizations based on their core competency– Core competency – is an organization’s key strength, a

business function that it does better than any of its competitors

– Core competency strategy –an organization chooses to focus specifically on its core competency and forms partnerships with other organizations to handle nonstrategic business processes

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UNIT 4 – CREATING COLLABORATIVE PARTNERSHIPS IN BUSINESS

• Information technology can make a business partnership easier to establish and manage– Information partnership – occurs when two or more

organizations cooperate by integrating their IT systems, thereby providing customers with the best of what each can offer

• The Internet has dramatically increased the ease and availability for IT-enabled organizational alliances and partnerships

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UNIT 5 – TRANSFORMING ORGANIZATIONS

• Unit 5 explores the power of IT to transform an organization, including:– 21st century organizations– Innovation– Systems development– Project management– Future trends

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UNIT 5 – TRANSFORMING ORGANIZATIONS

• Some business environment observers have an ominous vision of the future - digital Darwinism – organizations which cannot adapt to new demands are doomed to extinction

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OPENING CASE STUDY QUESTIONSHow Levi’s Got Its Jeans into Wal-Mart

1. Explain how Levi’s achieved business success through the use of information, information technology, and people

2. Describe the types of Levi’s jeans information staff employees at a Wal-Mart store require and compare it to the types of Levi’s jeans information the executives at Wal-Mart’s corporate headquarters require

3. Arrange the five units covered in this text and rank them in order of greatest to least impact on Levi’s competitive strategy

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CHAPTER ONE CASETechnology in Business

• Forester Research prediction that online retail sales would hit $101.1 billion in the United States came true in 2003

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CHAPTER ONE CASETechnology in Business

• 24 million households in the United States had broadband connections in 2003

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CHAPTER ONE CASETechnology in Business

• Online advertising revenue hit $3 billion in 2003

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CHAPTER ONE CASETechnology in Business

• According to eMarketer, the global Internet population was over 633 million in 2003

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CHAPTER ONE CASE QUESTIONS

1. Review the graphs in Figures 1.7 through 1.10 and explain why it is critical that businesses understand and embrace the Internet

2. Explain the correlation between the online retail sales graph (Figure 1.7) and the online advertising revenue graph (Figure 1.9)

3. The number of Internet users worldwide is two years ahead of its forecast. What are the potential impacts that underestimating the number of global Internet users might have on a business?