Leveraging Information Systems for Competition

1. Leveraging Information Systems for Competition Surviving and Thriving with IS: a Devil’s Advocate Position Eric Santanen, July 9, 2003 ILTM Presentation

2. Overview • Many organizations suffer from a variety of problems • Information systems can offer solutions to many of these problems; however, • There is no silver bullet! • Look at how management practices and IS fit together.

3. Information Systems • Collects, processes, stores, analyzes, & disseminates information • Automatically or with human intervention • What are some business functions performed by IS? • What benefits are offered by IS?

4. Understanding Your Organization • Think of a typical large organization • What are its characteristics? • Think: longevity, structure, mergers, reward structure, culture, attitudes of upper management, propensity for risk, • What are implicit assumptions of above? • Which of these are limitations? • How can these limits be overcome with IS?

5. Understanding Your Environment • What has changed since many of these large companies have begun? • In the marketplace? • With technology? • In society? • Business as usual no longer exists! • Those that think so will ultimately fail…

6. Understanding the Competition • What are some basic things we need to know: • About our competition? • About ourselves, relative to competitors? • How can we organize this information?

7. Porter’s Competitive Forces • Bargaining power of customers • Bargaining power of suppliers • Rivalry within industry • Entry barriers • Threat of substitute products/services • How can/do information systems impact these forces?

8. Looking Inside…Communication • All too often, departments do not or can not communication as they should • Customer data not shared • Internal data not shared • What are some technological reasons? • What are some non-technological reasons? • Think back to organizational characteristics... • How can these problems be solved?

9. Looking Inside: Project Mgmt • 1995 survey, 352 orgs, 8000 IS projects • Only 10% on time & under budget • 30% of software development projects fail • The remainder • Are over budget by 189% • Behind schedule by 222% • Why do these problems occur? • What can be done to turn failures into successes?

10. Why Software Development Fails

12. Project Management: Risks • How do you determine if an IS project is feasible? • What does “feasible” mean? • Levels of feasibility • Operational • Technical • Schedule • Economic

13. Operational Feasibility • Does management support this system? • How do users feel about their new role?? • Is resistance a real threat? • Will the working environment change?

14. Technical Feasibility • Is the proposed technology practical? • Technology is always available... To us? • Is it mature enough to apply? • Will it work with our current technology? • Do our people have necessary skills?

15. Schedule Feasibility • Are the project deadlines reasonable? • Are they mandatory or simply desired? • What is the penalty for missing a deadline? • What types of tools are available to manage schedules?

17. Economic Feasibility • How can you measure economics of IS? • There are several techniques... • What is wrong with these approaches to feasibility analysis? • Think in terms of information availability

18. Feasibility Dangers • A project that was once feasible may not remain so - why not? • Feasibilities can often conflict! • Best solution can often be the most expensive • good operational feasibility • poor economic feasibility • What can you do if the project is not feasible on all levels?

19. Making Development a Success • Primarily focused on SW development • Most hardware has a significant SW component • Three primary methodologies • Waterfall, Prototype, None • Which do you think is most common?

20. 1 2 … n-1 n Software Development • Sequential Methodologies “Waterfall” Survey, Study, Define, Target, Design, Construct, Deliver

21. 5 1 4 2 3 Software Development • Iterative Methodologies “Prototyping” Require, Design, Code, Test, Feedback

22. SW Development Tools • What is the value of dev methodologies? • How can you coordinate team efforts? • Who works on what? • At what times? • From what locations? • What is the single difference between: • IBM vs. Apple, DVD vs. DivX, Windows vs. Linuix

23. Looking Inside…Assets • What is a company’s most valuable asset? • What is a company’s greatest liability? • The Rudy example • Why do managers hate Rudy? • Why do managers need Rudy? • What to do in Rudy’s absence? • Is there a “better Rudy?”

24. Knowledge Management • Explicit (Leaky) Knowledge • Has been documented, can be distributed without interpersonal interaction • What are examples? • Tacit (Sticky) Knowledge • Personal accumulation of experiences • What are examples?

25. Knowledge Management Systems • Goal is to convert tacit to explicit knowledge so it can be shared • What’s wrong with this goal? • What “problems” need to be solved first?

26. Two Types of KMS • Knowledge Network Model • Facilitates person-to-person contact • “Yellow Pages” approach • Knowledge Repository Model • Transfer from person-to-repository-to-person • What goes into the repository?

27. Time for a Breath... • Where in the org should you put IS? • How do you make sure you haven’t overlooked opportunities?

28. Scope of Application • Data Records vs. Document-based • Entities: people, parts, transactions • Internal vs. External • Concepts: ideas, thought, opinions • Makes a 2x2 matrix • Where have organizations traditionally focused? Why?

29. Investment Strategy Analysis • General IS application areas • Institutional, professional, physical automation, external, infrastructure • Map these against functional components or user groups • R&D, QA, manufacturing, marketing, finance • What do we learn from this? • What comparisons can we make?

30. Summary • Range of organizational problems • Many have happened inadvertently • Many can be addressed by IS • IS alone is not a sufficient solution to any problem • Proper management is essential

31. Questions??

32. Waves of Adoption, I • The Innovators • On the cutting edge of technology • Most people don’t understand anything about these folks • Management’s Approach • Support them with funding & learn from them • What are advantages? Drawbacks? • How much funding should they get?

33. Waves of Adoption, II • Early Adopters: The First Consumers • Risk Takers: Owned BetaMax, 8-tracks, DivX • Wait at midnight for releases on Win95, etc. • “Gotta Have It!!!!” mentality • Management’s Approach • Significant opportunities can be missed if these people are ignored • Need guidance of IS dept to prevent overwhelming resources • How do we manage this group?

34. Waves of Adoption, III • The Early Majority: First Big Wave • Open to new technology but need help • Confused by terminology, new standards, no time to learn • Hold important positions in organizations, can make or break technology use: must see direct benefits • Management’s Approach • Lots of training! If needs are unmet, will be rejected • IS must know the business, non-tech products & services

35. Waves of Adoption, IV • Late Majority: Technology Skeptics • Not afraid of technology, have concerns about cost, risk, security, compatibility, time, learning curves for decision making • Face severe budget pressures • Will my client really benefit from this? • Management’s Perspective • Address risks, costs as well as opportunities • Address technology concerns (security) at level of the audience

36. Waves of Adoption, V • Technologically Averse • Not even considering a computer • Concerned about privacy, security, control • Real estate & Publishing: web pages bypass sunk costs in infrastructure • Management’s Perspective • Need to be aware of justifiable business fears • These people need the most time & education