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Business Systems:Strategy & Application

Business Systems:Strategy & Application. CM322 BMIBT Material supplied by: Richard Bertram Babak Akhgar . Strategy definitions. Quinn Pattern or plan that integrates organization’s major goals , policies and actions into cohesive whole Strategic decisions

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Business Systems:Strategy & Application

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  1. Business Systems:Strategy & Application • CM322 BMIBT • Material supplied by: • Richard Bertram • Babak Akhgar

  2. Strategy definitions • Quinn • Pattern or plan that integrates organization’s major goals, policies and actions into cohesive whole • Strategic decisions • Those that determine direction, goals, limits, use of key resources

  3. Purpose of strategy • To position or set direction within environment • To focus effort within the organization • To define the organization, to give meaning to the organization’s activities • To provide consistency • For efficiency & focus

  4. Thinking Strategically:The Three Big Strategic Questions • 1. Where are we now -- what is our situation? • 2. Where do we want to go? • 3. How will we get there?

  5. What Is Strategy? Concept • Competitive moves and business approaches management employs in running a company • Management’s “game plan” to • Please customers • Position a company in its chosen market • Compete successfully • Achieve good business performance A. Thompson, Jr. & A. J. Strickland, (1998)I

  6. The Five Tasksof Strategic Management Task 1 Task 2 Task 3 Task 4 Task 5 Develop a Strategic Vision & Mission Set Objectives Craft a Strategy to Achieve Objectives Implement & Execute Strategy Evaluate & Make Corrections Revise as Needed Revise as Needed Improve/ Change Improve/ Change Recycle as Needed

  7. A missionstatement focuses on current business activities For example: Customer needs currently being served Astrategic vision concerns a firm’sfuture business path The kind of company it is trying to become Customer needs to be satisfied in the future Missions vs. Strategic Visions

  8. Developing a Strategic Vision • A strategic vision is a roadmap of a company’s future -- • Direction it is headed • Business position it intends to stake out • Capabilities it plans to develop • Customer needs it intends to serve

  9. Examples: Mission andVision Statements • Otis Elevator • Our mission is to provide any customer a means of moving people and things up, down, and sideways over short distances with higher reliability than any similar enterprise in the world. Microsoft Corporation One vision drives everything we do: A computer on every desk and in every home using great software as an empowering tool.

  10. DEFINITION Overriding purpose in line with the values or expectations of stakeholders Desired future state: the aspiration of the organisation General statement of aim or purpose Resources, processes or skills which provide ‘competitive advantage’ TERM Mission Vision or strategic intent Goal Core competences

  11. A DEFINITION OF STRATEGY • Strategy is the directionand scopeof anorganisation over the long termwhich • achieves advantage for the organisation • through its configuration of resources within • a changing environment to meet the needs • of marketsand to fulfil stakeholder • expectations.

  12. LEVELS OF STRATEGY (1) • Corporate Level strategic decisions are concerned with: • overall purpose and scope • adding value to shareholder investment • portfolio issues • resource allocation between SBUs • structure and control of SBUs • corporate financial strategy

  13. LEVELS OF STRATEGY (2) • Business Unit strategy is concerned with: • competitive strategy • developing market opportunities • developing new products/services • resource allocation within the SBU • structure and control of the SBU

  14. LEVELS OF STRATEGY (3) • Operational Strategies are concerned with: • the integration of resources, processes, people and skills • to implement strategy

  15. Expectations and purposes Expectations and purposes Resources, competences and capability The environment Strategic analysis Bases of strategic choice Organisation structure and design Strategic choice Strategy implementation Resource allocation and control Strategic options Strategy evaluation and selection Managing strategic change A summary model of the elements of strategic management

  16. Information Systems Eras • Evolution of Information Systems • 1950-2000 (Time Frame)

  17. Working Definition of IS: • A system for the most efficient and effective means of identifying the "real" needs of users, and developing information processing systems for satisfying these needs; ensuring that the resulting information processing systems continue to satisfy changing user needs by the most efficient means of acquiring , storing, processing, disseminating and presenting information; by providing facilities and a learning environment for users and information systems specialists to improve the effectiveness of their decision models; and by supporting operational. Control and strategic organisational objectives." (Jayaratna p:21) • Understanding and Evaluating Methodologies (NIMSAD)

  18. Working Definition of IT • The term Information Technology is is used to emphesize the use of computers for information processing, storage, transmission and presentation with a clear need for satisfying user needs. • Jayaratna 1994 • Also See P. Checkland Information Systems and Information Systems Chapter one

  19. Working definition of ISS • An information system strategy is about creating a fit among information system activities. • To us this means a three way fit between business needs, current IT systems and new opportunities offered by technology. • The need for an information system strategy will depend upon an • organisation's size and line of business. The larger an organisation and the greater the information content of the product or value chain then the greater the need for an enterprise-wide information • system strategy. • M. Porter (IS Strategy and business Fit, 1998)

  20. Six Major types of Systems • TPS: Transaction Processing Systems • MRS: Management Reporting Systems • DSS: Decision Support Systems • EIS: Executive information systems • PSS: Professional Support Systems • OIS: Office Information Systems

  21. 1.TPS transaction processing systems operational level perform and record daily routine transactions necessary to conduct the business

  22. 2.MRS Management Reporting Systems Used by managers responsible for specific functions or processes in a firm provide routine summary and exception reports managers use these reports to help control their area of responsibility

  23. 3.DSS decision support systems Designed to support individual and collective decision making often use information from external sources more analytical power than other types of systems

  24. 4.EIS executive information systems strategic level of the organization support long-term, strategic view used by senior executives easy access to summarised company data incorporate external information on industry and economy

  25. 5.PSS Professional Support Systems Support performance of tasks specific to a given profession For example lawyers doing legal research architects designing buildings designers modeling a new automobile student C&P system (cut and paste system) !!

  26. 6.OAS office information systems support and help coordinate knowledge work in an office environment emphasis on increased productivity systems include e-mail, scheduling systems, word processing

  27. Analysis Frameworks Overview • What are frameworks for? • They help us to understand and classify the relation between competitive strategy and information technology. (Neumann) • They are a means of viewing, analysing and reaching meaningful conclusions about the role of information systems in helping achieve desired organisational performance.

  28. Framework of Frameworks

  29. Awareness Framework

  30. Awareness FrameworkRefocusing FrameworkStrategic Opportunities Framework

  31. Awareness FrameworkImpact ModelDegree of Strategic Change

  32. Awareness FrameworkScoping ModelInformation Intensity Matrix Information Intensity of the Value Chain

  33. Opportunity Framework

  34. Opportunity FrameworkSystem Analysis FrameworkThe Value Chain Firm infrastructure Human resource management Support activities Technology development Procurement Inbound logistics Operations Outbound logistics Marketing and Sales service Margin Source: Porter & Millar Primary activities

  35. Opportunity FrameworkApplications Search ToolCustomer Resource Life-Cycle

  36. Opportunity FrameworkApplications Search ToolMarketing Opportunity Search Framework

  37. Opportunity FrameworkBusiness Strategy FrameworkGeneric Strategy Options Competitive Advantage Competitive Scope

  38. Opportunity FrameworkBusiness Strategy FrameworkStrategic Option Generator What is the strategic target? Supplier Customer Competitor What is the strategic thrust? Differentiation Cost Innovation Growth Alliance What is the mode? Offensive Defensive What is the direction? Use Provide Source: Wiseman

  39. Positioning Framework

  40. Positioning FrameworksScaling FrameworksStrategic Grid

  41. Three - level IT Strategy IS Strategy Applications • Division/SBU/function based • Demand oriented • Business focused What? IM Strategy • Organisation based • Relationships oriented • Management focused Wherefore? Management IT Strategy • Activity based • Supply oriented • Technology focused How? Delivery Source: Earl

  42. A Multiple Methodology Business plans and goals IT opportunities Current systems Analytical Evaluative Creative Techniques, processes and environment Top down Bottom up Methodology Surveys and audits Inside out Brightsparks and product champions Teamwork Users and specialists Application strategic plan Source: Earl

  43. Reference • Information Systems evolution; Strategic Planning for Information Systems, by John Ward and Pat Griffiths 1997, pp:6-34 • Strategic Information systems; SISPby DSJ Remenyi 1992, pp:46-77 • ISS and IM strategy; Information Management by, Earl 1998 • ISS frameworks; Strategic Management of IS; Wendy Robson 1998, pp:48-74, 96, 128, 142, 155,166-170, 179-180, 188-189, 193, 299-305 • CMS Forum / CMS Learning Environment / CMS Courses /CM303-ISBS FT

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