designing and managing the information-based organization
TRANSCRIPT
Designing and Managing the Information-based Organization
NewBusinessEnvironmentOpen, competitive,dynamic, global marketplace
Open, user-centered network computing
NewEnterpriseNetworked, information- based organization
New IT Paradigm
Designing and Managing the Information-based Organization
NewBusinessEnvironmentOpen, competitive,dynamic, global marketplace
Productivity of Knowledge Workers
Quality
Responsiveness
Globalization
Outsourcing & Partnering
Social and Environmental Responsibility
Strategy Frameworks
• Miles & Snow’s Business Strategies
• Porter’s Generic Strategies
• Competitive Force Model
Business Strategies - Miles and Snow
• Defenders
• Prospectors
• Analyzers
Generic Strategies - Porter
• Low Cost Provider
• Differentiation
• Focus
Competitive Force Model
The Business
Power, vigor and competence of existing competitors(Intra-industry rivalry)
Power, vigor and competence ofcomplementors
Power, vigor andcompetence ofcustomers(Customers)
Power, vigor and competence of suppliers(Suppliers)
Possibility that what your business is doing can be done in a different way(Substitute Products & Services)
Power, vigor and competence of potentialcompetitors(Barriers to Entry)
New Enterprise
Structure Hierarchical Networked
State Static, stable Dynamic, changing
Personnel Managers Professionals
Key Drivers Reward & CommitmentPunishment
Basis of Action Control Empowerment
Learning Specific skills Achieve team goals
Compensation Position in Accomplishmenthierarchy Competence Level
PAST FUTURE
Competing in the Global Marketplace:The New Enterprise
HighPerformance Teams
ExtendedEnterprise
Enabling Technology The Promise The Change
HighPerformance Teams
EffectiveIndividual
IntegratedEnterprise
ExtendedEnterprise
InternetworkedBusiness“The Net”
InterenterpriseComputing
EnterpriseInfostructure
WorkgroupComputing
PersonalMultimedia
Wealth Creation,Social Development
Recasting ExternalRelationships
OrganizationalTransformation
Business Processand Job Redesign
Task, Learning,Efficience
Basic Organizational Forms
• Owner-Managed
• Functional, vertically integrated– Machine bureaucracy– Professional bureaucracy
• Diversified, divisionalized
• Matrix
• Network
• Virtual
Basic Elements of Structure
• Complexity– Horizontal– Vertical– Spatial
• Formalization
• Centralization
Strategy
Technology
Environment
Size
Organization Structure
Structural Contingency Theory
Organizing Framework
Miles and Snow’s Business StrategiesPorter’s Generic StrategiesPorter’s Competitive Force Model
EnvironmentStrategy Mgt Philosophy,
Values, Beliefs
Information Technology
Organization•Structure•Processes•Systems (Planning, Control)
The New IT Paradigm
Mainframe Era to Distributed Era:
Management and Technology
IT Management Environments
Era Administrative Target Justification
Framework
Mainframe(1950s - 1970s)
RegulatedMonopoly
Automateexisting processes
Efficiency(ROI)
Microcomputer(1970s to 1980s)
Free Market Effectiveness
Distributed(late 1980s topresent)
RegulatedFree Market
Outsourcing
Industry/Organizationaltransformation
Competitive Position
Increaseindividual/groupeffectiveness
The Old Vertical Computer Industry - Circa 1980
sales anddistribution
applicationsoftware
operatingsystem
computer
chips
IBM DEC Sperry Wang Univac
The New Horizontal Computer Industry - Circa 1995
sales anddistribution
applicationsoftware
operatingsystem
computer
chips
Retail Stores Superstores Dealers Mail Order
Word Word Perfect Etc.
DOS and Windows OS/2 Mac UNIX
Compaq Dell Packard Bell H-P IBM Etc.
Intel Architecture Motorola RISCs
The New IT Paradigm
Microprocessor Technology
Communication
Technologies
Number of Transistors on a Chip
2
1975 1980 1985 1990 1995 2000 2005
100
10
1
0.1
0.01
0.001
1
34
5
6
7Processor1 80862 802863 803864 804865 Pentium6 i6867 i786
Processor1 80862 802863 803864 804865 Pentium6 i6867 i786
Millions of Transistors per Chip
Source: Based on data provided by the Intel Corporation.
MIPS Forecast
1975 1980 1985 1990 1995 2000 2005
1
10
100
1000
MIPS
i786
i686
Pentium
80486
80386
80286
8086
Source: Based on data provided by the Intel Corporation.
Price/Performance Trends
$70,000
$40,000
$20,000
$7,000$300$50
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
Mainframe Mini PC
Cost per MIPS
1992
1995
Communication Technologies
2400 bps
9600 bps 14.4 Kbps
28.8 Kbps
ISDN - 128Kbps
ATM - 15Mbps up to 1.2 Gbps
Key Players in the U.S. Information Superhighway
• Telecommunications Companies (e.g. AT&T, MCI, Sprint)
• Cable TV
• Information Providers (e.g. AOL, Prodigy)
• Internet Providers
Expansion of the Internet:Global Penetration - The Americas
Adapted from Time Magazine, Spring 1995
High
CanadaIcelandUnited States
ArgentinaChileCosta Rica
Low BrazilColombiaEcuadorMexicoNicaraguaPanamaPeruPuerto RicoVenezuela
Medium
Rating based on a ratio of people to direct Internet connections, from High (200 people or less to each connection) to Low (5,000 or more people to each connection).
Expansion of the Internet:Number of Users (in millions)
0
20
40
60
80
100
120
1969 1982 1993 1998
Number of People with access to the Internet
Adapted from Internet Business Advantage, 1995
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
1991 1992 1993 1994* 1995**
Number of businesses registered on the Internet
Adapted from Internet Letter, Vol. 2, No. 5, Feb. 1, 1995*Through August 1994**Through March 1995
Expansion of the Internet:Growth of Commercial Use
The New IT Paradigm
Past Future
Network Computing
System Host-based Client-server
Data Management
Applications
Presentation
Display Only
Data Management
Data Management
Data Management
Applications Applications
Presentation Presentation
Presentation
Applications Applications
Data Management
Host-Based Processing Client/Server Cooperative Processing
DistributedPresentation
DistributedApplications
DistributedDatabases
Server Computer
Mainframe
Terminal
Client Computer
Host vs. Client-Server ProcessingHost vs. Client-Server Processing
The New IT Paradigm
Past Future
Open Systems
Standards + Rules Limited Single,(Architecture) Vendor- Proprietary Vendor-Proprietary
or Neutral
Information forms Separate data, textMultimedia
voice, image
Vendor-customerRelationships Account ControlMulti/Vendor
Partnerships
The New IT Paradigm
Past Future
Revolution in Software
Software Development CraftEngineeredUser Interface Text Graphical
Applications Stand-alone;Integrated
Stovepipe
IT & the Pursuit of Value Disciplines
InformationTechnology
BusinessValue
Supports NewOrganizationalParadigm
Strategy Organization
Enablesthe Pursuit of Strategy
IT & the Pursuit of Value Disciplines
Operational Excellence
Customer Intimacy
ProductLeadership
LogisticsProcesses
IT and Operational Excellence:Using Integrated Information for
Increased Visibility
Logistics
ServiceMarketing& Sales
OutboundProductionInbound
Physical Value Chain
Integrated Information Foundation
IT and Operational Excellence: Emergence of New Business Models
Traditional Cut-Flower Industry Chain
Calyx’s & Corolla’s New Cut-Flower Industry Chain
Calyx & Corolla
Participant
Grower Jobber Wholesaler Florist
Markup 50% 100% 150%
Price charged $8.00 $12.00 $24.00 $60.00
Price charged $54.00
Participant
Marketplace
Marketspace
IT & Value Disciplines:Operational Excellence
Focus
• Minimize cost • Maximize efficiency across the physical value chain• Doing business in a different way
Measurement
• Precision • Quality• Speed• Cost
ComputingEmphasis
•Core operating processes•Building an integrated information infrastructure•Management processes•Coordination processes•Implementing new business model
IT & the Pursuit of Value Disciplines
ProductLeadership
ServiceMarketing& Sales
OutboundLogistics
ProductionPrcesses
IT and Product Leadership:Exploiting the Virtual Value Chain Through Mirroring
InboundLogistics
Physical Value Chain
Virtual Value Chain
Design
ServiceMarketing& Sales
OutboundProductionInbound
ServiceMarketing& Sales
OutboundLogistics
ProductionProcesses
IT and Product Leadership:Creating New Information-based Products
InboundLogistics
Physical Value Chain
New Products New Products New Products New Products
IT & Value Disciplines:Product Leadership
Focus
Create and rapidlyintroduce newproducts andservices
Ethic
• Creativity• Risk
ComputingEmphasis
• Market and product intelligence• Design and engineering tools• IT-based products and services
IT & the Pursuit of Value Disciplines
Customer Intimacy
LogisticsProduction
IT and Customer Intimacy:Creating New Customer Relationships in the Virtual Value Chain
ServiceMarketing& Sales
OutboundLogistics
ProductionProcesses
InboundLogistics
Logistics Physical Value Chain
Virtual Value Chain
IT & Value Disciplines:Customer Intimacy
Focus
• Tailor products and services for customers• Make it easy for your customers to do business with you
Ethic
• Relationships• Empowerment• Knowledge• Customization
ComputingEmphasis
• Customer information and analysis• Creation of information by-products• Product configuration systems• Direct communication with customers
Organizing Framework
Miles and Snow’s Business StrategiesPorter’s Generic StrategiesPorter’s Competitive Force Model
EnvironmentStrategy Mgt Philosophy,
Values, Beliefs
ITOrganization•Structure•Processes•Systems (Planning, Control)
•IT Architecture•IT Development & Implementation•IT Organization
Designing and Managing the Information-Based Organization
• Teaching by the Case Method• Preparation, Presence, Participation, Prompt
• Class Discussion
• Course Materials
• Weekly Assignments - Case Discussion
• Individual Assignment - Case Analysis
• Group Project