Introduction to Information Systems Chapter 12 1 Introduction to Information Systems Essentials for the Internetworked E-Business Enterprise Eleventh Edition James A. O’Brien Chapter 12 Enterprise and Global Management of e-Business Technology Irwin/McGraw-Hill James A. O’Brien Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. Introduction to Information Systems Eleventh Edition 2 Chapter Objectives • Identify several ways that information technologies have affected the job of managers in e-business companies. • Explain how problems of information system performance can be reduced by the involvement of business managers in IS planning and management. • Identify the seven major dimensions of the e-business organization and explain how they affect the success of ebusiness companies. Irwin/McGraw-Hill © 2002 McGraw-Hill Companies Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. 1 Introduction to Information Systems James A. O’Brien Chapter 12 Introduction to Information Systems Eleventh Edition 3 Chapter Objectives • Identify each of the three components of e-business technology management and use examples to illustrate how they might be implemented in e-business enterprise. • Identify several cultural, political, and geoeconomic challenges that confront managers in the management of global ebusiness technologies. Irwin/McGraw-Hill James A. O’Brien Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. Introduction to Information Systems Eleventh Edition 4 Chapter Objectives • Explain the effect on global e-business strategy of the trend toward a transnational business strategy by international business organizations. • Identify several considerations that affect the choice of IT applications, IT platforms, data access policies, and systems development methods by a global e-business enterprise. Irwin/McGraw-Hill © 2002 McGraw-Hill Companies Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. 2 Introduction to Information Systems James A. O’Brien Chapter 12 Eleventh Edition Introduction to Information Systems 5 Managing e-Business Technologies Information Technology Developments Customer Value E-Business •Agility, Flexibility •Business Strategies •Supply Chain •Total Quality Suppliers •Responsiveness •Accountability •Lower costs •Global and enterprise computing; intranets •IT infrastructure Business Partners Irwin/McGraw-Hill Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. National Gobel in Brief NABEL, 3/7/2003 Products : TV, Audio, Refrigerator, Air Conditioner, Washing Machine, Electric Fan, Electric Iron, Pump, Car Audio, Pants Press Brand Established Capital Share holders : : July 27, 1970 : US$ 23 Million : Matsushita Electric Industrial Co. Ltd. (60%) Gobel International (40%) : 3,204 (April 2003) : Rp. 1.8 Trillion (27% export) Employees Sales (2002) Audio Factory © 2002 McGraw-Hill Companies Air Conditioner Factory Refrigerator Factory 3 Introduction to Information Systems Chapter 12 Global Competitiveness NABEL, 3/7/2003 Global : WTO •Regulation Domestic Market Government •Incentive •ISO CERT. •ANTI DUMPING •ENERGY SAVING •RECYCLING •Certification Competitiveness •Vision •Policy •HIGH QUALITY •COST •SPEED •GLOBAL MODEL Manufacturer University •Apprenticeship •Research Export Market James A. O’Brien Regional : APEC Sub-Regional : AFTA Introduction to Information Systems Eleventh Edition 8 The e-Business Organization Organization Structure Leadership People and Target Culture Potential Coherence Business Quality Traditional Organization Improvement Hierarchical Risk Alliances Horizontal, networked Incrementally Improving Existing Processes Existing Processes Centralized focus Radically Redesigning Business Systems Business Everyone isSystems a leader Any Process Vertical decision making Strategic Delegated Business authority Processes Processes Collaboration rewarded Individuals rewarded 10%-50% Improvements 10%-50% Improvements Internal relevance 10-Fold Improvements 10-Fold Improvements Customer relevance Individualistic Low Low High High Payback Knowledge Business E-Organization Reengineering Institutional Ally with distant partners Complement current gaps Ally with competitors, customers Top-down Distributed IT and Organizational and suppliers Create new value New Same Job Cuts; Same Jobs Jobs -- More More Efficient Efficient Big Big Job Cuts; New Jobs; Jobs; What Changes? IT and Work Simplification Major Primary Major Job Job Redesign Redesign Governance Irwin/McGraw-Hill © 2002 McGraw-Hill Companies Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. 4 Introduction to Information Systems Chapter 12 The Role of Information Technology NABEL, 3/7/2003 A company that cannot change the way it thinks about Information Technology cannot re-engineer Distruptive Technology Old Rule New Rule Information can appear Information can appear in only one place simultaneously in as many at one time places as it is needed Business can Business must choose simultaneously reap the between centralization benefits of centralization and decentralization and decentralization Only expert can perform A generalists can do the complex work work of an expert Shared databases Telecommunications networks Expert Systems Decision Support Tools (database access, modeling software) Managers make all decisions Decision-making is part of everyone’s job Source: Reengineering The Corporation - Michael Hammer & James Champy James A. O’Brien Introduction to Information Systems Eleventh Edition 10 Example of organizational structure of an e-business enterprise Consumer Products Business Unit E-commerce Business Unit Shared IT Support Services Business Unit Shared Administrative Support Services Business Unit Irwin/McGraw-Hill © 2002 McGraw-Hill Companies Global Executive Core Industrial Products Business Unit Financial Services Business Unit Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. 5 Introduction to Information Systems James A. O’Brien Chapter 12 Eleventh Edition Introduction to Information Systems 11 e-Business Technology Management e-Business Technology Management Managing e-Business IT Strategy Irwin/McGraw-Hill James A. O’Brien Managing Application Development & Technology Managing the IT Organization Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. Eleventh Edition Introduction to Information Systems 12 IT Strategic Planning Management Customer and Business Value Visioning More Questions Key Insights E-Business Strategies and Models Feedback Key Objectives E-Business IT Strategies and Architecture Feedback Irwin/McGraw-Hill © 2002 McGraw-Hill Companies Priorities E-Business Application Development & Deployment Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. 6 Introduction to Information Systems James A. O’Brien Chapter 12 Introduction to Information Systems Eleventh Edition 13 Benefits Derived from Company IT Planning • • • • • • • Reduced support costs Reduced complexity Expertise portability Interoperability Volume discounts Reduced training costs Information sharing Irwin/McGraw-Hill James A. O’Brien Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. Introduction to Information Systems Eleventh Edition 14 Managing the IS Function Application Development •Systems Analysis •Systems Design •Programming •System Maintenance Human Resource Management •IS Recruiting •Training •Retainment Programs •Support Staff IT Operations Management •Network Management •Production Control •Product Support •Systems Performance Irwin/McGraw-Hill © 2002 McGraw-Hill Companies Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. 7 Introduction to Information Systems James A. O’Brien Chapter 12 Eleventh Edition Introduction to Information Systems 15 Global e-Business Technology Management Global IT Management Cultural, Political, and Geoeconomic Challenges e-Business/IT Strategies e-Business Application Portfolios Irwin/McGraw-Hill James A. O’Brien Internet-based Data Technology Resource Platforms Management Systems Development Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. Introduction to Information Systems Eleventh Edition 16 Global e-Business Strategies International -Autonomous operations -Region Specific -Vertical Integration -Specific Customers -Captive Manufacturing Irwin/McGraw-Hill © 2002 McGraw-Hill Companies Global -Global Sourcing -Multiregional -Horizontal Integration -Some transparency of customers and production Transactional -Virtual e-Businesses -World Markets -Transparent Manufacturing -Global Supply Chain -Global Alliances Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. 8 Introduction to Information Systems James A. O’Brien Chapter 12 Introduction to Information Systems Eleventh Edition 17 Business Drivers for Global e-Business Global Customers Global Products Global Operations Business Drivers for Global e-Business Irwin/McGraw-Hill James A. O’Brien Global Resources Global Collaboration Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. Introduction to Information Systems Eleventh Edition 18 Global IT Platform Issues Global Infrastructure •Global Data Access •Regulated Access •Transborder Data Flows Global Systems Development Global Computing Facilities •Local vs. Global Requirements •Multilingual Needs •Standardization of Data •Scheduling Global Activities Irwin/McGraw-Hill © 2002 McGraw-Hill Companies •Hardware acquisitions •Import restrictions •Software compatibility •Local service •Balancing workloads •Lack of spare parts Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. 9 Introduction to Information Systems James A. O’Brien Chapter 12 Introduction to Information Systems Eleventh Edition 19 Chapter Summary • e-Business technologies are changing the distribution, relationships, resources, and responsibilities of managers. • High-quality information system performance is dependent on extensive and meaningful management and user involvement in the governance and development of IT applications. • The organizational structure and roles of ebusiness companies are undergoing major change as they strive to become customerfocused. Irwin/McGraw-Hill James A. O’Brien Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. Introduction to Information Systems Eleventh Edition 20 Chapter Summary (cont) • Managing IT in an e-business has three major objectives: – Managing the joint development and implementation of e-business IT strategies. – Managing the development of e-business applications and the research and implementation of new technologies. – Managing IT processes, professionals, and subunits within the company. Irwin/McGraw-Hill © 2002 McGraw-Hill Companies Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. 10 Introduction to Information Systems James A. O’Brien Chapter 12 Introduction to Information Systems Eleventh Edition 21 Chapter Summary (cont) • Managing global e-business technologies includes: – Dealing with cultural, political, and geoeconomic challenges posed by various countries. – Developing appropriate business and IT strategies. – Developing a portfolio of global e-business and e-commerce applications and an Internet-based technology platform to support them. Irwin/McGraw-Hill James A. O’Brien Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. Introduction to Information Systems Eleventh Edition 22 Chapter Summary (cont) • Many businesses are becoming global companies and moving towards transnational e-business strategies in which they integrate the global business activities of their subsidiaries and headquarters. Irwin/McGraw-Hill © 2002 McGraw-Hill Companies Copyright © 2002, The McGraw-Hill Companies, Inc. All rights reserved. 11
