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TEW-bedrijfskunde: BA2Digital
Organisations
[Ondertitel van document]
Prof. Dr. Steven De Haes
,CHAPTER 1: INFORMATION
SYSTEMS IN GLOBAL BUSINESS
TODAY
OPENING CASE: RUGBY FOOTBALL UNION TRIES BIG DATA
The objective of the union was to try and promote rugby. To succeed in this complicated mission, the RFU
entered into a five-year deal with IBM to capture and analyze Big Data that will be useful to both fans and the
players themselves. To capture the data they use Trytracker. They try to provide data visualization and real-
time statistics to draw in fans. They also try to provide tactical insights to players and coaches twat will improve
match play. It demonstrates IT’s role in increasing value and revenue in any business and it illustrates the
potential for technology to improve customer experience.
1.1 HOW ARE INFORMATION SYSTEMS TRANSFORMING GLOBAL BUSINESS, AND WHY
ARE THEY SO ESSENTIAL FOR RUNNING AND MANAGING A BUSINESS TODAY?
HOW INFORMATION SYSTEMS ARE TRANSFORMING BUSINESS
– It is not business as usual anymore in the global economy. Information systems are transforming our
economy.
– Increasing investments in IT
Mobile digital platform
Systems used to improve customer experience, respond to customer demand, reduce
inventories and more
Growing online newspaper readership
Expanding e-commerce and internet advertising
New federal security and accounting laws
– As a manager, you want to make sure you made the right investments.
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,WHAT’S NEW IN MANAGEMENT INFORMATION SYSTEMS
New technology innovations:
Cloud computing: you store your data in the cloud instead of on your laptop. The advantage is
cost reduction and scalability. The risk is that there is a huge privacy leak. Sometimes
businesses run a whole business process in the cloud with salesforce.com for example.
IT doesn’t matter (Carr 2003). In the 17th and 18th centuries, the first companies that went
from steam machines to electricity machines had a huge advantage. Now, electricity has
become a commodity. Carr claims the same has happened with IT. Everything in IT has been
commoditized. You can just buy applications whenever you want. You have to manage IT as a
cost that you have to keep as low as possible.
not true. There is of course a part in IT that has been commoditized (like laptops and
smartphones) but not all technology has been commoditized. Carr later wrote a book
that IT still doesn’t matter but business processing does.
Internet of things: in every bin, there is a chip and the chip talks to the city when it’s full. The
same is true for the lights in the street. They will send a message to the city when they’re
broken. Everything will start to talk to everything.
Mobile digital platform
New business models (eg. Uber)
e.g.: emergence of online video services like Netflix and Apple Itunes
Expanding e-commerce
e-commerce is changing how firms design, produce and deliver their products and services. It has
reinvented itself again, disrupting the traditional marketing and advertising industry and putting major
media and content firms in jeopardy.
Management changes
Online collaboration and social networking software
Business intelligence
Virtual meetings
Changes in firms & organizations
GLOBALIZATION CHALLENGES AND OPPORTUNITIES: A FLATTENED WORLD
– Internet has drastically reduced costs of operating on global scale
Because of the internet, the world has become flat again. It has become very easy to do business.
– Presents both challenges and opportunities
Opportunity: due to globalization it has become easier to do business around the globe
Challenge: a lot of industries are leaving Europe to go to China or India (outsourcing). It
therefore becomes a challenge to develop high-level skills through education and on-the-job
experience that cannot be outsourced.
– What does globalization have to do with management information systems?
The emergence of the internet into a full-blown international communications system has drastically
reduced the costs of operating and transacting on a global scale. Briefly, information systems enable
globalization.
THE EMERGING DIGITAL FIRM
– In a fully digital firm
Core business processes (eg. Sales, marketing, logistics) are accomplished through digital
systems
Key corporate assets are managed digitally (eg. HR, finance)
Significant business relationships are digitally enabled and mediated
– Digital firms offer greater flexibility in organization and management
Time shifting: allowing business to be conducted at any time
Space shifting: allowing business to be conducted at any place
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, – Business processes refer to the set of logically related tasks and behaviors that organizations develop
overtime to produce specific business results and the unique manner in which these activities are
organized and coordinated.
STRATEGIC BUSINESS OBJECTIVES OF INFORMARTION SYSTEMS
– Growing interdependence between
Ability to use information
technology
Ability to implement
corporate strategies and
achieve corporate goals
– Changes in strategy, rules and business
processes increasingly require changes
in hardware, software, database and
telecommunications. Often, what the
organization would like to do depends
on what its systems will permit it to do.
– Firms invest heavily in information systems to achieve six strategic business objectives:
Operational excellence: businesses continuously seek to improve the efficiency of their
operations in order to achieve higher profitability. Information systems are some of the most
important tools available to managers to achieve higher levels of efficiency and productivity
in business operations, especially when coupled with changes in business practices and
management behavior. Ex: the fulfillment tack of Amazon. There is a huge amount of
technology required to let your package arrive on time. Ex 2: retail sector. When you take a
package of milk of the shelf, information goes to the suppliers so that they know when the
shelves have to be refilled (supply chain).
New products, services and business models: information systems and technologies are a
major enabling tool for firms to create new products and services as well as entirely new
business models. A business model describes how a company produces, delivers and sells a
product or service to create wealth. Ex: apple and itunes. You can now stream your music in a
legal way which has highly impacted the music industry. Ex 2: spotify, uber or Airbnb
Customer and supplier intimacy: when a business really knows its customers and serves them
well, the customers generally respond by returning and purchasing more. Ex: flying
companies invest a lot in technology and social media because flying has become a
commodity throughout the years and so they have to make sure customers come back not
only considering the prices but also other things like their service
Improved decision making: in the past decade, information systems and technologies have
made it possible for managers to use real-time data from the marketplace when making
decisions. Ex: bakery battle. A game in which all bakers can play and so be educated. With this
game, HR could staff the bakers better and more.
Competitive advantage: when firms achieve one or more of these business objectives,
chances are they have already achieved a competitive advantage. Ex: bol.com is continuously
improving the experience of their site so that they can compete with others. Ex 2: the reason
why banks went online banking was to stay competitive and be the first one on the market.
Survival: business firms also invest in information systems and technologies because they are
necessities of doing business. Ex: regulation such as GDPR (general data protection act). It’s
about privacy in Europe to ensure that all personal information is guaranteed to be
confidential. SOX (Sarbanes-Oxley) is a regulation out of the United States. the CEO and the
CFO have to guarantee in person that all the facts and data in the financial report of the year
are accurate. If it’s not accurate, the CEO and the CFO will have to go to jail. All the financial
data are in information systems so you have to make sure your systems are protected against
unauthorized people.
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