Information Systems Today, 2/C/e ©2008 Pearson Education Canada 2-1 Lecture Outline 9 1. Using Information Systems for Competitive Advantage (p. 31-35)

Information Systems Today, 2/C/e ©2008 Pearson Education Canada2-1

Lecture Outline 9

• 1. Using Information Systems for Competitive Advantage (p. 31-35)

• 2. Highlights of Electronic Business (p. 244-251)


Strategy and Competitive Advantage

How to get Competitive Advantage *MC• Having the best-made product on the market• Delivering superior customer service• Achieving lower cost than rivals• Having proprietary manufacturing technology• Having shorter lead-times in developing and testing new

products• Having a well-known brand name and reputation• Giving customers more value for their money

• INFORMATION SYSTEMS CAN HELP HERE

Achieving StrategyProviding support in a way that enables the firm to gain or sustain competitive advantage over rivals

Achieving StrategyProviding support in a way that enables the firm to gain or sustain competitive advantage over rivals


Traditional vs. Strategy Support Process

Example AVIS RENTA CARUsing handheld technology combined with a reengineered business process to create a competitive advantage


Competitive Advantage examples

• 7-11 in Japan:

• - consumer focused orientation based on IT

• - who buys what , where at what time

• - extensive knowledge of market


Competitive Advantage examples

• Avis Rent-A Car– What provides the advantage?

• Innovative technology?• Or, strategic, creative use of technology?

• Domino’s Pizza – Where is the advantage here?


Using Systems for Competitive advantage

• For an information system to have competitive advantage, it must be: *L– Valuable– Rare***

• e.g., can ATM be used for competitive advantage?

• Many IT jobs in future will be to develop systems for competitive advantage

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Electronic Commerce

The process of buying or selling goods or services across a

telecommunications network.

Many technologies facilitate E-commerce

-Electronic funds transfer

-Electronic data interchange

-Internet / world wide web


Electronic Commerce- another definition-

The online exchange of goods, services, and money among firms, and between firms and their customers


Types of Electronic Commerce *MC


e-Commerce: online selling of goods and services- business to consumer (B2C)

e-Business: broader, not just selling (follow-up customer service, EDI between businesses)- terms are not (yet) clearly defined

-reason for B2C: increase sales by providing more opportunity for more people to purchase goods and services from you

- reason for B2B: to save money


**Revenue Models for e-commerce

• How will we make money? *MC

2-12

Innovative marketing *X

Use the power of the Web and Internet to leverage new ideas,

and new business models

e.g., Hotmail gave away free e-mail accounts that used a Web

interface and was linked to a site.


Ease of Entry Into Markets *MC

• The Internet opened up access to markets by lowering barriers to entry.

• Good ideas can be cloned.

• Advantage frequently goes to First Mover

• EBay was a “first mover”


ESTABLISHING AN E-COMMERCE WEB SITE *L

1. Dedicated Server

- business sets up own server TO SERVE E-BUSINESS WEB PAGES- connect to Internet through a dedicated line- install proper software for managing server and creating Web pages- expert staff required- offers most control


2. **Web Hosting Services *L

- hosting company offers space on its server for the hosting of Web sites

- may provide software tools for flexible page development

- majority of businesses do not maintain their own Web server; they use host services;


Showing your e-business on customer screen *MC

- storefront: can have your own business on one separate web page this is a OR

- cybermall hosts pages of many businesses and users browse them all

- user who went into one mall store may also visit yours out of curiosity


Outsourcing Web Operations *L

• Using a web hosting service provides an e-business with several advantages.

• A web hosting service has a staff available 24 hours a day with the technical knowledge to keep the servers and network connections running.


Outsourcing cont’d *L

• An web hosting company can provide a level of redundancy that an e-business may not be able to provide for itself, including redundant hard drives on the servers, backup power from generators, and redundant connections to the internet.


Outsourcing cont’d *L

• One disadvantage of outsourcing Web site operations is lack of control.

• One solution to this lack of control is for an e-business to provide its own servers and software and simply co-locate its servers at the Web hosting company facilities.


Design for Your Website *MC

Allow customers to order products and services online?

Provide technical support for products and services?

Advertise products and services?

Build the e-business’s image and brand?

Collect information about current and potential customers?

Provide links to related web pages?

Provide general or industry information?

Recruit employees


General E-business Security cont’d *MC

• Businesses must protect against the unknown.

• New methods of attacking networks and Web sites and new network security holes are being constantly discovered or invented.

• An e-business cannot expect to achieve perfect security for its network and Web site



Several aspects of e-business computer systems security need to be addressed:

• How secure is the server software? • How secure are communications



• How is the data protected once it is delivered to the e-business?

• How are credit card transactions authenticated and authorized?

• The biggest potential security problem in an e-business is of human, rather than electronic, origin.

• The weakest link in any security system is the people using it.


Network and Web Site Security *X

• An entire glossary of words and phrases identifies network and web security risks, such as hacker, cracker, Trojan horse, and more.

• As part of planning a startup e-business’s security, management should become familiar with network and web server security risk terminology


Denial of Service Attacks *MC

• A type of attack designed to disable a web site by flooding it with useless traffic or activity.

• Distributed denial of service attack uses multiple computers to attack in a coordinated fashion.

• Risk is primarily centered around downtime or lack of web site availability.

• Defenses exist for these attacks.


Credit Card Fraud & Data Theft *MC

• E-business is at risk from credit card fraud from stolen data.

• Secure your own data.• Verify the identity of your customers and

the validity of the incoming credit card data.

• Identity theft by a criminal masquerading as someone else, is a too common problem.


Front-End Systems **L

• Front- end systems are those processes with which a user interfaces, and over which a customer can exert some control.

• For an e-business, front-end systems are the Web site processes that customers use to view information and purchase products and services.


Back-End Systems *L

• Back-end systems are those processes that are not directly accessed by customers.

• Back-end systems include the business’s TPS and MIS systems that handle the accounting and budgeting, manufacturing, marketing, inventory management, distribution, order-tracking, and customer support processes.


Front & Back-End Systems


Integrating the “ends” *L

• Online sales transactions are the heart of an e-business’s operations.

• The sales and payment information gathered from online sales transactions must be integrated with other back-end processes

Information Systems Today, 2/C/e ©2008 Pearson Education Canada 2-1 Lecture Outline 9 1. Using Information Systems for Competitive Advantage (p. 31-35)

Documents

competitive advantage

money information systems

pearson education canada

money slide

mc slide

services business

types of electronic

e commerce