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Chapter 5 Managing Information Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 2 What Would You Do? The PC industry is very competitive How can Dell and its suppliers work more closely together? How can Dell handle all the information it generates? Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 3 Moore’s Law Adapted from Exhibit 5.1 Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 4 Learning Objectives Why Information Matters After discussing this section you should be able to: 1. explain the strategic importance of information 2. describe the characteristics of useful information (i.e., its value and costs) Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 5 Strategic Importance of Information First-mover advantage Sustaining a competitive advantage Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 6 Does the information technology create value? No Competitive Disadvantage Yes Is the information technology different across competing firms? Yes No Competitive Parity Is it difficult for another firm to create or buy the information No technology? Temporary Competitive Advantage Adapted from Exhibit 5.2 Sustained Competitive Advantage Yes Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 7 Characteristics of Useful Information Accurate Complete Relevant Timely Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 8 The Costs of Useful Information Acquisition Processing Storage Retrieval Communication Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 9 Learning Objectives Information Technologies After discussing this section you should be able to: 3. explain the basics of capturing, processing, and securing information 4. describe how companies can share and access information and knowledge Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 10 Capturing Information Bar Codes Electronic Scanners Optical Character Recognition Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 Processing Information Data Mining 11 Data warehouse Two types supervised unsupervised Association or affinity patterns Sequence patterns Predictive patterns Data clusters Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 12 Protecting Information Firewalls Virus Data encryption Virtual private networks Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 Accessing and Sharing Information and Knowledge 13 Communication Internal Access & Sharing of Information External Access & Sharing of Information Sharing Knowledge and Expertise Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 14 Communication Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 15 Internal Access and Sharing Executive information systems (EIS) Intranets Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 16 Executive Information System (EIS) Uses internal & external data Used to monitor and analyze organizational performance Must be easy to use and must provide information that managers want and need Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 17 Characteristics of Best-Selling EIS Ease of Use • Few commands to learn • Save important views • 3-D charts • Geographic dimensions Adapted from Exhibit 5.6 Analysis of Information • Track Sales • Easy-tounderstand displays • Time periods Identifying Problems and Exceptions • Compare to standards • Trigger exceptions • Drill down • Detect & alert newspaper • Detect & alert robots Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 18 Intranets Company networks Allow employees to easily access, share, and publish information using Internet software Growing in popularity Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 19 Why Intranets, Not EIS Are Growing Less expensive Efficient Intuitive and easy to use Compatible with different operating systems Can work with existing equipment Work with most software programs Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 20 Blast From The Past The History of Managing Information Cro-Magnons create lunar calendar Travelers and town criers spread news Paper and printing press revolutionize information management Typewriters and copy machines make information more “routine” Cash registers and time clocks help with employee management Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 21 External Access and Sharing Electronic Data Interchange Internet Extranet Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 22 Been There, Done That Business-to-Business Information Exchanges: Why There Time Has Come Companies can save lots of money by automating their supply chain The Internet can make purchasing more efficient Reducing the transaction cost of business Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 23 Sharing Knowledge and Expertise Knowledge is the understanding one gains from information Decision support systems (DSS) uses models to analyze information Expert systems replicate experts’ decisions Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003 24 What Really Happened? Dell shares information with its suppliers Dell is on the cutting edge of information technology Use the Internet to handle customer billing Management, 2e by Chuck Williams South-Western/Thompson Learning Copyright © 2003