ISM 158
Business Strategy and
Information Systems
Jack Callon
Objective for Today
For you to decide that you are
in the right class at the right time.
Right Class at the Right Time
• Course objectives and content.
• Assignments and grading.
•Your opportunities.
• My expectations.
ISM Business Capstone Class
This class was considered the most difficult of the
MIS classes at SJSU. (10% non-pass rate)
The only class that has both CS and Econ/Business
prerequisites.
A business class for those with IT knowledge.
“Important to come to class.”
ISM 158 - Business Strategy and IS
Business
Knowledge
I/S Knowledge
ISM Student
• Systems A&D
• Programming
• Database
• Telecom
Understand how
to use I/S to solve
business problems
“ I’m Ready to Graduate!
• Accounting
• Finance
• Operations
• Marketing
• Human
Resources
Class Objectives
• Learn practical, useable things.
• Become savvy as to major business issues and
trends in the high-tech world.
• Help you look good in job interviews.
• Help you make a difference when you get hired.
. . . . For a price!
Message from Miles Welter
Make sure that students understand that this
course is significantly more challenging than
ISM 50.
They also need to understand that the
business analysis paper in ISM 50 was a
relatively easy assignment compared to the
analysis term paper in this class.
Important Business Topics
• Direct Business Model
• E-Commerce
• E-Business
• Supply Chain Management (Customer Relationship
Management)
• Reengineering Core Business Processes
• Outsourcing
• Managing Change
A Successful Business
The right business model now and for the future.
Provides value to customers.
Is responsive, flexible, adaptable, innovative,
resilient, talented and financially strong.
Is anything else necessary to achieve and sustain
business success?
Underlying Theme of Course
Your job as an IS professional is
to help your company to do a
better job of competing!
Where Does an ISM Graduate Fit?
Senior Management
Company
Users
Information
Systems
Organization
Effort
ISM 158 - If in the Spring Quarter
*
Time
Effort
ISM 158 - If in the Spring Quarter
*
C or P
Time
Jack Callon
• Third Year at UCSC
• Director of New Program Development, SOE
• 11 1/2 Years at SJSU College of Business
• 28 years at IBM in Sales and Marketing
(California, Tokyo and Munich)
• 3 years in the U.S. Air Force
• MBA from Indiana University
• ISM major sponsor and ISM Club Advisor
JDC Terminology
• Information Technology (IT)
• Information Systems (IS)
• Computing
• Telecommunications
• Data Communications
• Voice Communications
• IS Organization
Class Premises
Every enterprise faces unprecedented competitive challenges.
The source of this competition is becoming more global and the
pace of change within the business environment is accelerating.
A business enterprise needs to understand where it is going.
The business vision and its supporting strategies should drive
the role and use of information systems within the organization.
The compression of time and events has significantly increased
information needs for the growing number of people involved in
making decisions within an enterprise.
Class Premises
For the above reasons the potential role of information
systems as a competitive resource has increased.
Innovative use of information technology needs (dictates) a
systematic approach. To accomplish this, it is essential that
there be an on-going working relationship between those that
run the business and the people charged with a responsibility
for information systems.
Conclusion: It is necessary to establish and maintain three
distinct perspectives.
Three Perspectives
1. Business Environment (Industry)
2. Company
3. IT Role, Use, and Management
[
Of
With
[
Management
Information Systems
Four Important C’s
Competition
Computers
Complexity
Change
Competitive Enabler
Of all the things that can change the rules of
competition, technology change is among
the most prominent.
A Systematic Approach
Vision
Strategy
Tactics
Business Plan
• Competitive Options
• Roles, Roles and Relationships
• Redefine and/or Define
• Telecommunications
as the Delivery Vehicle
• Success Factor Profile
A Satisfied Student
1. I never realized that Information Systems played such a
significant role in so many very successful companies.
2. I really enjoyed doing a paper on Wal-Mart and learned
a great deal from the experience.
3. I feel that I can personally do an objective assessment
of a company as to their effective use of information
systems to gain a competitive advantage.
Class Decorum
The classroom should be treated like a business
environment.
Class activities should be treated like a business
meeting.
What is New?
• A revised list of companies for the analysis term papers.
• A major focus on the Internet as it impacts business
strategies and IT use.
• Use of WebCT to supplement course material.
• Will attempt to use guest lecturers with the help of IT.
Grade Structure
Class Contribution
10%
Analysis Term Paper
45% (10, 10, 20, 5)
Midterm Exam
15%
Comprehensive Final Exam
30%
Note: Exams will not be open book or open notes.
Class Contribution
• Positive participation in class
• Introduction letter
• Oral presentations (sign up today)
• Overall professionalism
Oral Presentations
Introduce or summarize the textbook chapters.
Five minute presentations.
Part of class contribution grade.
Oral Presentation Evaluation
Established a presence before beginning.
Good eye contact with audience.
Good voice articulation.
Organization and content.
Focused on key factors.
Professionalism of presentation.
Used but did not exceed time allowed.
Overall evaluation.
Chapter Introduction
• Introduce the chapter (does not mean that you explain its
content.)
• Address business issues, topics, significance.
• Address IT issues, topics, significance.
• Explain how the material fits within the bigger picture.
Will include Powerpoint slides that you will email to
me 24 hours before the presentation.
Chapter Summary
• Key messages of the chapter.
• Major business management issues.
• IT issues (if any).
• Why the above factors are significant/important.
• Three or four possible exam questions that focus
on important chapter content.
Will include Powerpoint slides that you will email to
me 24 hours before the presentation.
Competitive Advantage Through
Information Technology
by Jack Callon
This book is dedicated to those that must compete
in an increasingly complex, dynamic and global
business environment. I wish you the best of
success in your competitive endeavors and hope
that the contents of this book provide the help
that is intended.
Misleading advertisement from Amazon.com
Textbook Status
Structure and concepts are current and valid.
Company examples and status are dated in
some cases.
Textbook Structure
1. Introduction Chapter
2. Business Environment
3. Company Assessment
4. Structured Analysis of IS Use
5. Management Issues
Textbook
Preface: Book Overview
Chapter 1: Business and Information Systems
Management Challenges
Textbook
Section I - The First of Three Perspectives:
Business Environment
Chapter 2: Business Competitive Environment
Chapter 3: The Porter Competitive Model
for Industry Structure Analysis
Chapter 4: Airline Industry Analysis
Chapter 5: Information Systems Can Redefine
Competitive Boundaries
Section II - The 2nd Perspective:
Company Environment
Chapter 6: Business Vision
Chapter 7: Implementing a Vision:
Strategy, Tactics and Business Plan
Section III - The 3rd Perspective:
Information Systems Use
Chapter 8: Evaluating Business Strategies and
the Use of Information Systems
Chapter 9: The Roles, Roles and Relationship Concept
Chapter 10: The Redefine and/or Define Concept
and Change Management
Chapter 11: Telecommunications as the Delivery
Vehicle
Chapter 12: A Success Factor Profile
Section IV: Major Information Systems
Management Issues
Chapter 13: Information Systems Organization
and Personnel Considerations
Chapter 14: Information Systems Value
and Financial Strategy
Chapter 15: Integrating Information Systems
into the Business Plan
Chapter 16: Total Quality Management
and the Role of Information Systems
Chapter 17: Conclusions
Exhibit I - Why Change When You Are Flying
High?
An Analysis of The Boeing Company
Read the Boeing paper for background and understanding
of the assignment. Don’t overdo the duplicating of how
it was done.
“Expert Profile”
• Peter Drucker - Business Vision
• Michael Porter - Structure and Analysis
• Peter Keen - I/S and Telecom Trends
• Tom Peters - Business Motivation
Why Don’t All Companies
Successfully Use I/S to Compete?
1. Business Reasons.
2. Information Technology
Reasons.
Importance of Analysis Term Paper
Successful completion of the analysis term paper is
mandatory to pass the course.
You can do joint research and charts but the entire paper will
be written individually.
You must select a different company than the one you
addressed in ISM 50.
Important that you talk to me regarding your papers.
Analysis Term Paper Grades
1. Analysis Grade - 50%
Did you analyze the major important points in
an effective manner?
2. Presentation Grade - 50%
How well were the contents of the paper
organized and presented. This includes
spelling, grammar and whether the total
paper “comes together.”
ATP Companies
Amazon.com - A winner or a leader of the losers?
Cisco Systems - From boxes to end-to-end communication!
Dell Computer - The direct business model king!
Intel Corporation - Shifting major business strategies.
IBM Storage Systems Division - A major shift in its business.
Knight-Ridder (SJ Mercury News) - what business are they in?
Charles Schwab - Keep changing their spots!
UPS - Have they caught up to FedEx?
Wal-Mart Stores - B&M versus Internet for toys and a lot more.
ATP Companies
All of these companies have major Internet implications as
to their strategies and their ability to continue to be
successful.
Your papers should focus on these implications.
Include this focus as part of the objective statement of
your paper.
Amazon.com
• A major emphasis on brand strategy.
• Was there very easy in the .com cycle.
• Have never made a profit.
• Can Jeff Bezos really run a successful company?
• Will they be the exception to those that say that click
and mortar will be the winners? If so, why?
Cisco Systems
• Claim that they built the Internet.
• From routers to end-to-end communication.
• Want to be their own best reference!
• Cisco Connection is the basis for 82% of revenue.
• Research and technology through acquisition.
• Success is attracting major competitors.
• John Chambers walks on water.
Dell Computer
• Fierce competition in the PC segment of the Computer
Industry.
• Questionable profit margins.
• As prices get cheaper, clones are losing market share.
• A global market that is US dominated.
• Direct Business model is a very hot topic and Dell is the
king!
• The ultimate example of outsourcing.
IBM Storage Systems Division
• IBM made a major shift in the focus and priorities of
its business to OEM products.
• This required the creation of a significant number of
new business processes.
• These processes were by necessity computer-based.
• This entire effort required managing multiple plants
in different parts of the world as if they were a
single entity.
Intel
• New leaders and a new business strategy.
• Does it really make sense?
• How important is it to continue to grow as a company?
• What primary strengths has Intel had in the past?
Knight-Ridder
• Newspapers were a traditional source of information.
• Industry is dominated by conglomerates.
• San Jose Mercury News was one of the first to go online
first with AOL and then via the Internet.
• Mercury Center has lost its differentiation advantage.
Charles Schwab
• Is in third phase of company redefinition.
• Determining best way to compete.
• Threat of Internet-based brokers.
• Gain versus preservation strategies of clients.
UPS
• Had some good indications that FedEx wouldn’t make it.
• They did!
• Had ten years of catching up to do.
• Senior management’s new vision.
• HR guy headed IS with IS pros reporting to him.
• Have they actually caught up to FedEx and was it worth it?
Wal-Mart Stores
• World’s largest retailer.
• Sam is gone!
• Took some major hits for poor initial efforts on the Internet.
• Can it succeed as both a B&M and Internet channel?
• Did it make sense to split the B&M and Internet effort?
• At what point does a company have major problems
simply because of size?
Hall of Fame Applications
•
•
•
•
•
•
•
•
•
•
•
•
Wal-Mart’s Replenishment System
Allegiance’s (AHS) Value Link
American Airline’s SABRE
FedEx’s Tracking System
Citibank’s Cash Management Account
Boeing’s 777 Design System
Amazon.com’s Web Book Store
Sun Mircosystem’s Intranet
Frito-Lay’s Sales Automation System
Schwab’s Street Smart and eSchwab
Otis Elevator’s Remote Monitoring System
Kash n’ Karry’s Returns Process System
CIO Hall of Fame
Most influential IS execs of the past decade
Paul Strassman, Xerox
Katherine Hudson, Kodak
DuWayne Peterson, Merrill Lynch
Charles Feld, Frito-Lay
Cinda Hallman, DuPont
Patricia Wallington, Xerox
David Evans, J.C. Penney
John Cross, British Petroleum
Max Hopper, American Airlines
Bob Martin, Wal-Mart Stores
Ron Ponder, Federal Express
Don Lasher, USAA
Hall of Fame Technologies
•
•
•
•
•
•
•
•
•
•
•
•
Wintel de facto desktop standards
Networking
E-mail and Fax
Open Systems
Client-Server Architecture
Electronic Data Interchange (EDI)
Mobile Computing
Groupware
High Bandwidth Networking
Data Warehousing/Data Mining
Enterprise Software Suites
World Wide Web/Browsers
Hall of Fame Management Trends
• Reengineering
• Globalization
• Outsourcing
• Standardization
• Quality
• Coopetition
• Benchmarking
• Strategic Alignment
• Customer Service
• Remote Workers
• Mass Customization
• The Next Ten Years
Boeing Commercial Aircraft Company
Analysis Paper
Paper Objective
I Commercial Aircraft Industry Summary
A. Industry Profile
B. Typical Industry Competitive Strategy
C. Porter Competitive Model Analysis
D. Globalization of the Industry
E. Importance of Information Technology to the Industry
II Boeing Company
A. Boeing Company Profile
B. Market and Financial Performance
C. Competitive Strategy Statement
D. Significance of Information Systems
E. Strengths and Weaknesses of Boeing as a Company
III Information Systems at Boeing Commercial Aircraft Company
A. Structured Analysis
1. Strategic Option Generator
2. Roles, Roles and Relationships
3. Redefine and/or Define
4. Significance of Telecommunications
5. Success Factor Profile
IV A Final Analysis: The Success of the Boeing Commercial
Aircraft Company
A. Success of Business Strategy and IT Use to Date
B. Is the Company Effectively Postured for the Future?
Bibliography
ATP Grades
1. Section I and II will be written and submitted individually.
2. A revised Section I and II will be resubmitted with Section
III and IV as a final complete paper.
3. Each section is given a specific grade.
4. The Section III grade is based on 1/3 for the revised Section
I and II and 2/3 on Section III.
5. Section IV has its own grade.
Analysis Term Paper
1. Information Given Today.
2. WebCT (web page) guidelines.
Analysis Term Paper Challenges
3. Analyze, Write and Edit Paper
Company
1. Content and Organization
2. Researching Content
ATP Quiz
Sign onto WebCT and take the ATP Quiz before
midnight of January 8 .
You have thirty minutes to take the quiz and two
chances to earn a passing grade.
ATP Discussion Points
1. A definition of the analysis company industry in writing.
2. A draft of the Porter Competitive Model.
3. A draft of the Business Strategy Model.
4. A list of the key people within the company that will
serve as the basis of the company analysis.
5. A draft of the strengths and weaknesses of the analysis
company.
A Complication
There has never been a time in history when there
was a better Information Technology
price/performance.
And so many choices of equipment, vendors and
approaches.
Business Strategy and Information Systems
• Concepts
• Relative To (Bigger Picture)
• Company Examples
IS Management Strategies?
• Executive Partnership
• Strategic Architectures
• Technology Experimentation
• External Resource Leverage
• Technology Assimilation
• Functional Horizontal Integration
Balanced Business Scorecard
• Customer Measures
• Internal Business Measures
• Culture
• Financial Measures
Business Strategy and Information Systems
• What business is Federal Express in?
• Significant industry structure considerations.
• National versus international market.
• Strengths and weaknesses of Federal Express.
• Significance of Information Systems to business
success.
WebCT
http://ic.ucsc.edu:8000/webct/public/home.pl
Log on ID is CATS account or existing email address
with the password based on the first four letters of last
name and the last four digits of social security number.
How to login document is at:
http://ic.ucsc.edu/Help/WebCT/how-to-login.htm
WebCT
Includes:
• Course calendar
• Boeing Analysis Paper
• Syllabus
• ATP Guidelines
• Bulletin Board
• ATP Research
• Lecture Notes
• ATP Checklist
• ATP Companies
• ATP Quiz
Class Schedule
Start
1/04/00
Midterm
Exam
2/01/00
Sec. I and II
of Paper Due
2/03/00
Final Paper
Due 3/07/00
Sec. I, II, III
and IV
10 Weeks
Final
Exam
3/16/00
Conclusion
If you feel you are in the right class at the
right time and are prepared to make the
necessary time commitment, see you on
Tuesday.