EMBA 610EMBA 610Management Information SystemsManagement Information Systems

Dave Salisbury

davesalisbury@mail.com (email)

http://faculty.cob.ohiou.edu/salisbury/ (web site)

This Week’s Fun StuffThis Week’s Fun Stuff

IT for Competitive AdvantageDiscussion of the Power of Virtual

IntegrationFord and Virtual Integration

Strategic IssuesStrategic Issues

Strategic Advantage– If you’re first, a novel technology creates

an advantageStrategic Necessity

– Eventually, technology-based gains are lost because they are easily replicable

Information Resource AdvantagesInformation Resource Advantages

What makes it valuable?Who gets the value?Is it equally distributed?Is it mobile?How quickly does it depreciate?

Sustainable Competitive Sustainable Competitive AdvantageAdvantage

The Environment– What happens “out there”

Foundation Factors– Something unique to leverage

Action & Strategy– What you do with the situation

Differentiation

Low Cost

Innovation

Growth

AllianceSupplier

Custom

erC

ompetitor

EntrantSubstituteS

trat

egy

Porter’s Forces

Value Chain ModelValue Chain Model

Organization

Human Resources

Technology

Purchasing

Su

ppo

rtA

ctiv

itie

sP

rim

ary

Act

iviti

es

InboundLogistics

MaterialsHandlingDelivery

Operations Manufacturing

Assembly

OutboundLogistics

OrderProcessingShipping

Marketing& Sales ProductPricing

PromotionPlace

ServiceCustomerServiceRepair

Supply Chain ManagementSupply Chain Management

Network of facilities and distribution options – Procurement– Transformation– Distribution

IT is obviously heavily involved

Customer Resource Life CycleCustomer Resource Life Cycle

Establish Requirements

Specify Select Source Order Authorize/Pay for Acquire

Test and Accept Integrate Monitor Upgrade Maintain Transfer/Dispose Account for

IT & Business ProcessesIT & Business Processes

IT as an enabler of changeReengineeringTotal Quality Management

Breaking Business BarriersBreaking Business Barriers

Time BarriersGeographic BarriersCost BarriersStructural Barriers

Automation, Improvement, Automation, Improvement, ReengineeringReengineering

Business Process Automation (BPA)– Simply automate the existing business

processBusiness Process Improvement (BPI)

– Business processes are changed in significant, yet incremental ways

Business Process Reengineering– Business processes are radically changed

Existing Process

BPA BPI BPR

PotentialPayoff, Risk, Change

Redesign ContinuumRedesign Continuum

New Process

Processes v. FunctionsProcesses v. Functions

Functions– Marketing, Finance, etc.

Processes– Things that get done– Tend to cross functional barriers

ProcessesProcesses

Beginning and endInputs and outputsSet of transformational tasksCross functional boundariesMetrics to assess performance

– cycle time– throughput

ReengineeringReengineering

Outcome AnalysisBreaking AssumptionsTechnology AnalysisActivity EliminationProxy BenchmarkingProcess Simplification

Enterprise Information SystemsEnterprise Information Systems

SAP, PeopleSoft, etc.A means to pull together scattered and

fragmented ISModules for various operations activities

– Manufacturing– Accounting– Human Resources– Sales

Enterprise Information SystemsEnterprise Information Systems

Require fundamental changes to business processes

If you have no processes in place, no biggie

If you do have existing processes, and they are a source of advantage, EIS are not appropriate

When you are out of time, it’s a canned package that works

Change ManagementChange Management

People Don’t Generally Like ChangeHow to get it done?

– revolutionary design– evolutionary implementation

Perceived Characteristics of InnovatingEnd User InvolvementWork the Culture

DellDell

Direct business modelBypass the dealer channelInventory velocityTechnology navigatorVirtual integration

DellDell

Partnerships and trustAffiliation with the customerFast-cycle segmentationTrading inventory for informationUsing IT to stay close to the customer

Ford and Virtual IntegrationFord and Virtual Integration

Radical business process redesignIt works for Dell; will it work at Ford?What are the similarities between the

two businesses?What are the differences between the

supply chains at Dell and Ford?