Concept of Strategic Info.

System:
Is a type of Information System that is associated with business strategy and structure. The association increases the capability to respond faster

to environmental changes and thus creates a competitive

advantage. "The information system to support or change enterprise's strategy." - by Charles Wiseman

Concept of Strategic Info. System:

Different from other systems as: They change the way the firm competes by changing the goals, operations, products, services, or environmental relationships of the organizations to help them gain an over edge over competitor.

Concept of Strategic Info. System:

Foundation Factors (Infrastructure)

Environment

Management Actions & Strategies (Leadership)

Performance Firm

Key features
1) Decision Support Systems that enable to develop a strategic approach to support Information Systems (IS) or

Information Technologies (IT) with an organization's

business strategies Examples: 2) Primarily Enterprise Resource Planning (ERP) solutions that integrate/link the business processes to meet the

enterprise objectives for the optimization of the enterprise

resources

Key features
3) Database systems with the "Data Mining" capabilities to make the best use of available corporate information for marketing, production, promotion and innovation. The SIS systems also facilitate identification of the data collection strategies to help optimize database marketing opportunities.

4) The Real-time Information Systems(RTIS) that intend to maintain a rapidresponse and the quality indicators.

Competitive Strategy Concepts

Policies intended to influence behavior by aligning the interests of the individual with the interests of the organization

Management Controls
Formal budgeting policies credit policies Informal culture

attitudes
leadership styles

spending policies travel policies

purchasing policies

Competitive Strategy Concepts

A competitive strategy consists of moves to Attract customers Withstand competitive pressures Strengthen an organizations market position The objective of a competitive strategy is to generate a competitive advantage, increase the loyalty of customers and beat competitors.

Competitive Strategy Concepts

Low Cost Leadership Strategy Differentiation Strategy Innovation Strategy

Growth Strategies
Alliance Strategies IT role relative to each of these strategies?

Organizational Learning: Doing Things Better

Going beyond automation Involves learning to improve the day-to-day activities within the process Looking at patterns and trends

Organizational Learning
Using acquired knowledge and insights to improve organizational behavior

Total Quality Management (TQM)

Monitoring an organization to improve quality of operations, products, and services

Supporting Strategy: Doing Things Smarter

Strategic Planning
1.

Create a vision: setting the direction

2.
3.

Create a standard: performance targets

Create a strategy: reaching the goal

Why Competitive Strategies?

Low-Cost Leadership
Best prices on goods/services
Examples: Dell, Nirma, Tata 4 wheelers

Differentiation
Finding ways to differentiate to create value for customers that are not easily copied
Examples: IBM, Tata Namak, Parle, Samsung

Why Competitive Strategies?

Best-Cost Provider (middle-of-the-road)
The objective is to create superior value by meeting or
beating customer expectation on product attributes and beating their price expectations Example: Wal-Mart, Big Bazaar,

Contribution of Information Systems to pursue Competitive Strategies

An SIS emphasis on clear strategy. Sources of competitive advantage:
Best-made product Superior customer service Lower costs Superior manufacturing technology Shorter lead times Well-known brand name High value per cost

Contribution of Information Systems to pursue Competitive Strategies

IS and Value Chain Analysis
Value Chain Analysis: adding value within an organization Organizations as big input/output processes IS can automate many value chain activities:
Purchased supplies inbound logistics Operations Outbound logistics Marketing and Sales Service

The value chain

A Tool developed by Dr. Michael porter of

Harvard Business School

The value chain

Can be used to examine the various activities of the firm and how they interact in order to provide a source of competitive advantage by:

- PERFORMING THESE ACTIVITIES BETTER OR - AT A LOWER COST THAN THE COMPETITORS

The value chain

SUPPORT

FIRM INFRASTRUCTURE HUMAN RESOURCE MANAGEMENT

MARGIN

ACTIVITIES

TECHNOLOGY DEVELOPMENT PROCUREMENT

INBOUND LOGISTICS

OPERATIONS

OUTBOUND LOGISTICS

MARKET-ING & SALES

SERVICE
MARGIN

PRIMARY ACTIVITIES

THE GENERIC VALUE CHAIN

The value chain

1. INBOUND LOGISTICS
- concerned with receiving, storing, distributing inputs
(e.g. handling of raw materials, warehousing, inventory control)

2. OPERATIONS - consist of The Transformations Of The Inputs Into up to the

Final Product Form (E.G. Production, Assembly, And Packaging)

The value chain

3. OUTBOUND LOGISTICS
- Involve the collecting, storing, and distributing the product to the buyers (e.g. Processing of orders, warehousing of finished goods, and delivery)

4. MARKETING AND SALES

- How buyers can be convinced to purchase the product (e.g.

Advertising, promotion, distribution)

The value chain

5. SERVICE
- Involves how to maintain the value of the product after it is
purchased (e.g. Installation, repair, maintenance, and training)

Building information systemsContemporary Approaches:

 Information systems are sociotechnical systems.

Although they are composed of machines, devices, and "hard" physical technology, they require substantial social, organizational, and intellectual investments to make them work properly.

Since problems with information systemsand their solutionsare rarely all technical or behavioral, a multidisciplinary approach is needed.

The study of information systems deals with issues and insights contributed from technical and behavioral disciplines.

Systems As a Planned Organizational Change:

The process of building a new information system is one kind of planned organizational change. System builders must understand how a system will affect the organization as a whole. They must consider how the nature of work groups will change and how much change is needed.

Four kinds of structural organizational change which are enabled by information technology are:
Automation: Enables employees to perform their tasks more efficiently and effectively Rationalization of procedures: The reorganization of standard operation procedures, eliminating obvious bottlenecks, so that automation can make operating procedures more efficient Business process reengineering: Analyzes, simplified, and redesigns business processes with a mind to radically reduce business costs Paradigm shift: A radical re conceptualization of the nature of the business and the nature (pattern, nature) of the organization.

The causes of Information System Failure During Implementation

Poor communications:
Good communication is essential and often, it needs to be done via different media in order to ensure that it reaches all levels of

the organization.

Lack of a powerful guiding coalition:

For successful change to occur, the leadership must include strong line-leadership who are committed to the success of the project.

The causes of Information System Failure During Implementation

Lack of change management:
Project management is important to ensure that the project is adequately staffed, funded and coordinated.

Lack of short-term wins:

As most Information Systems implementation takes many

months if not years, there needs to be planned achievable shortterm goals built into the process every 6 to 18 months.