The Role of Information Systems in Business Today * Making wise choices on how to invest in information technology can allow your firm to outperform your competitors * Supply chains have become more fast paced, with companies depending on just-in-time inventory to reduce their overhead costs and get to market faster * Businesses are starting to use social networking tools to connect their employees, customers and managers worldwide (also used as a form of advertising, ex. Facebook) * Technology is continually changing, successful firms are those that learn how to use the new technologies and maximize their gain from them
There are three interrelated change in the technology world: 1. The emerging mobile digital platform (iphones, blackberry, netbooks, ipad) 2. Growth of online software as a service 3. Growth in “cloud computing” more and more business software runs over the internet
* Managers routinely use “web 2.0” technology (i.e. social networking, collaboration tools, wikis) in order to make better, faster decisions * Rely heavily on mobile digital platform to satisfy customers and manage employees * Nb: collaboration spaces are where employers meet one another, even when they are separated by continents and time zones. * This means decentralization outsource more work, rely on markets to build value rather than employees
The challenge for your business is to avoid markets for goods and services that can be produced offshore for a cheaper price. * The emergence of the Internet into a full-blown international communications system has drastically reduced the costs of operating and transacting on a global scale (globalization has EVERYTHING to do with management information systems!) * Information systems ENABLES globalization
Digital Firm: one in which nearly all of the organization’s significant business relationships with customers, suppliers and employees are digitally enabled and mediated.
Business Processes: refer to the set of logically related tasks and behaviours that organizations develop over time to produce specific business results and the unique manner in which these activities are organized and coordinated (ex. Developing a new product or creating a marketing plan) * Digital firms sense and respond to their environments far more rapidly than traditional firms, giving them more flexibility to survive in turbulent times. (ex. Dell computers)
* There is a growing interdependence between a firm’s ability to use info. tech and its ability to implement corporate strategies and achieve corporate goals
Businesses invest heavily in information systems to achieve six strategic business objectives: 1. Operational Excellence a. Continually seeking to improve efficiency of operations in order to achieve higher profitability 2. New Products, Services and Business Models b. Enabling tools for firms to create new products and services as well as new business models (model that describes how a company produces, delivers and sells a product) i. Ex. Apple changed the way of distributing music (different business model) 3. Customer and Supplier Intimacy c. Use of info. systems and technology to achieve customer intimacy thereby increasing loyalty and raising revenues and profits (same concept for suppliers) d. Ex. Hotels tracking guest preferences such as preferred room temp. , TV programs, etc. 4. Improved Decision Making e. Use of real time data from the marketplace to make decisions 5. Competitive Advantage f. Achieving any of the above business objectives may put your firm at a competitive advantage (higher quality, lower costs, more efficient, etc.) 6. Survival g. May be a necessity of doing business (ex. ATMs) h. Driven by industry level changes