Transcript MAR 4721 Professor Charles Hofacker

MAR 4721
Professor Charles Hofacker
Module 3
Internal Company Operations
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Lecture Overview
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How Companies Have Changed
Competitive Advantage with IT
Use of Intranets by Companies
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Companies Began to Change in the Late 70’s
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The Apple II was introduced in 1979
The IBM PC was introduced in 1981
Ethernet Technology in the mid-80’s
IP based networks in the early 90’s
Off the shelf Intranet applications in the mid90’s
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Industrial Age Hierarchical Organization
Evans, P. B. and T. S. Wurster
(1997), "Strategy and the New
Economics of Information,"
Harvard Business Review, 75 (5),
70-82.
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Organizations Hollowed and Flattened in the 80’s
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Flattened Corporation Circa mid 1980s
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Network Age Corporation
Evans, P. B. and T. S. Wurster
(1997), "Strategy and the New
Economics of Information,"
Harvard Business Review, 75 (5),
70-82.
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Firms Assimilate New Technology Slowly Over Time
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Cumulative
Adoption
Acquisition
Assimilation
Gap
Deployment
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Time
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Fichman, Robert G. and Chris F. Kemerer (1999), "The Illusory
Diffusion of Innovation: An Examination of Assimilation Gaps,"
Information Systems Research, 10 (3), 255-75.
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Stages of IT Assimilation
Organizational
Learning
Transformation
Information
Automation
1970
1980
1990
2000
2010
Data Processing-----|--Micro Computing--|-----------Network Era---
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Brady, Mairead (2003), "Managing Information Technology," Irish
Journal of Management, 24 (1), 125-138.
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Class Discussion
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Give a hypothetical example where a company uses
the Internet to automate a process so as to reduce
costs
Give a hypothetical example where a company uses
the Internet to provide better information to
management so that those managers can make better
decisions in a more timely fashion.
Give a concrete example where a company uses the
Internet to transform itself or an entire industry
creating a competitive advantage.
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Resource-Based View of the Firm
How do firms derive sustained competitive
advantage from IT investment?
Firms need resources that are valuable, rare,
inimitable, non-substitutable (VRIN)
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What Are Resources?
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Assets
o Tangible assets IT infrastructure (commodity)
o Intangible assets reputation, image, equity
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Capabilities
Competences, processes and routines for combining
assets
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From Where Does Competitive Advantage Arise?
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Infrastructure components are commodities
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The capability of putting these together for a
firms’ strategic environment is difficult
o Learning-by-doing
o Know-how
o Corporate culture
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Wade, Michael and John Hulland (2004), "The Resource-Based View
and Information Systems Research: Review, Extension, and Suggestions
for Future Research," MIS Quarterly, 28 (1), 107-42.
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What Is an Intranet?
An Internet used for internal company purposes,
usually closed to outsiders
The ends are employee collaboration,
coordination and productivity
The means are the gear and the software that
facilitate those things
It is typically based on a client-server model
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Internet Services Harnessed for Company Goals
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Email – the killer app
Calendar applications
The Web Browser as kiosk
Audio-video teleconference
Whiteboard, netmeeting
Document sharing
BBS’s, listserves and chat
Workflow management
Document management
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Class Discussion Question
4. Why do you suppose business people are
heavy users of email while students are heavy
users of text messaging and chat?
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Indirect Benefits on Social Process
Enhances employee collaboration,
coordination
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Empowerment
Well trained employees with decentralized authority to solve customer
problems using IT
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Virtual Teams
Groups of workers from any time zone working together using email,
whiteboard, chat, voice over net, etc,.
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Sales and Marketing Applications
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Product information, specs
Market research
Prospecting
Managing sales contacts
Sales training
Awad, Elias M. (2003), Electronic Commerce, Second Edition,Pearson
Prentice-Hall: Upper Saddle River, NJ.
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