Spring 2012 FAST NU

Saba Pervez

IT IN BUSINESS

COURSE STRUCTURE

2 LABS AND 1 CLASS SESSION PER WEEK

Quizzes 10%

Mid Term1&2 20%

Projects 20%

Final 50%

CLASS RULES

Don’t be late -1 for disturbing the class Will also include some class work from

time to time SABA.PERVEZ@NU.EDU.PK

COURSE OBJECTIVES

A thorough understanding of a user-level view of IT, and its’ role in the society.

The ability to use computers to enhance productivity, including effective use of Microsoft Word, PowerPoint, Excel, and Outlook.

Good understanding of the worldwide web and internet applications.

How IT helps organizations perform more effectively Alignment of IT and business strategy The risks and common pitfalls of IT implementations How e-business is shaping businesses.

COURSE BOOK

Main Text: Efraim Turban and Linda Volonino -

Information Technology for Management: Improving Performance in the Digital Economy.

THE COMPUTER DEFINED

Electronic device Converts data into information Modern computers are digital

Two digits combine to make data Older computers were analog

A range of values made data

1A-6

COMPUTERS FOR INDIVIDUAL USE

Notebook computers Small portable computers Weighs between 3 and 8 pounds About 8 ½ by 11 inches Typically as powerful as a desktop Can include a docking station

1A-7

COMPUTERS FOR INDIVIDUAL USE

Tablet computers Newest

development in portable computers

Input is through a pen

Run specialized versions of office products

1A-8

COMPUTERS FOR ORGANIZATIONS

Network servers Centralized computer All other computers connect Provides access to network resources Multiple servers are called server farms Often simply a powerful desktop

1A-9

COMPUTERS FOR ORGANIZATIONS

Mainframes Used in large

organizations Handle thousands

of users Users access

through a terminal

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COMPUTERS FOR ORGANIZATIONS

Minicomputers Called midrange computers Power between mainframe and desktop Handle hundreds of users Used in smaller organizations Users access through a terminal

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COMPUTERS IN SOCIETY

More impact than any other invention Changed work and leisure activities Used by all demographic groups

Computers are important because: Provide information to users Information is critical to our society Managing information is difficult

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COMPUTERS IN SOCIETY

Computers at home Many homes have multiple computers Most American homes have Internet Computers are used for

Business Entertainment Communication Education

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COMPUTERS IN SOCIETY

Computers in education Computer literacy required at all levels

Computers in small business Makes businesses more profitable Allows owners to manage

Computers in industry Computers are used to design products Assembly lines are automated

1A-14

COMPUTERS IN SOCIETY

Computers in government Necessary to track data for population

Police officers Tax calculation and collection

Governments were the first computer users

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PARTS OF THE COMPUTER SYSTEM

Computer systems have four parts Hardware Software Data User

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What's in a computer?

Major pieces – processor ("central processing unit" or CPU) does the work, controls the rest – memory (RAM = random access memory) stores instructions and data while computer is running – disks ("secondary storage") stores everything even when computer is turned off – other devices ("peripherals")

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PARTS OF THE COMPUTER SYSTEM

Hardware Mechanical devices in the computer Anything that can be touched

Software Tell the computer what to do Also called a program Thousands of programs exist

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PARTS OF THE COMPUTER SYSTEM

Data Pieces of information Computer organize and present data

Users People operating the computer Most important part Tell the computer what to do

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INFORMATION PROCESSING CYCLE

Steps followed to process data Input Processing Output Storage

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ESSENTIAL COMPUTER HARDWARE

Computers use the same basic hardware

Hardware categorized into four types

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ESSENTIAL COMPUTER HARDWARE

Processing devices Brains of the computer Carries out instructions from the program Manipulate the data Most computers have several processors Central Processing Unit (CPU) Secondary processors Processors made of silicon and copper

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ESSENTIAL COMPUTER HARDWARE

Memory devices Stores data or programs Random Access Memory (RAM)

Volatile Stores current data and programs More RAM results in a faster system

Read Only Memory (ROM) Permanent storage of programs Holds the computer boot directions

1B-23

ESSENTIAL COMPUTER HARDWARE

Input and output devices Allows the user to interact Input devices accept data

Keyboard, mouse Output devices deliver data

Monitor, printer, speaker Some devices are input and output

Touch screens

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ESSENTIAL COMPUTER HARDWARE

Storage devices Hold data and programs permanently Different from RAM Magnetic storage

Floppy and hard drive Uses a magnet to access data

Optical storage CD and DVD drives Uses a laser to access data

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SOFTWARE RUNS THE MACHINE

Tells the computer what to do Reason people purchase computers Two types

System software Application software

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SOFTWARE RUNS THE MACHINE

System software Most important software Operating system

Windows XP Network operating system (OS)

Windows Server 2003

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SOFTWARE RUNS THE MACHINE

Application software Accomplishes a specific task Most common type of software

MS Word Covers most common uses of computers

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COMPUTER DATA

Fact with no meaning on its own Stored using the binary number system Data can be organized into files

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COMPUTER USERS

Role depends on ability Setup the system Install software Mange files Maintain the system

“Userless” computers Run with no user input Automated systems

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Chapter 1

CHAPTER 1

John Wiley & Sons, Inc.

IT Supports Organizational Performance in

Turbulent Environments

Copyright 2010 John Wiley & Sons, Inc.

CHAPTER OUTLINE

1.1 Doing Business in the Digital Economy 1.2 Information Systems and Information

Technology (IT) 1.3 Business Performance Management,

Business Pressures, Organization Responses, and IT Support

1.4 Strategy for Competitive Advantage and IT Support

1.5 Social Computing and Networking

1-2

Copyright 2010 John Wiley & Sons, Inc.

LEARNING OBJECTIVES

1. Describe characteristics of the digital economy and digital enterprises.

2. Define information systems, computer-based information systems and information technology.

3. Explain the relationships between performance, environmental pressures, organizational responses, and information technology.

4. Identify major pressures in the business environment and describe major organizational responses to them.

5. Describe adaptive enterprises and why they are IT-dependent.

1-35

Copyright 2010 John Wiley & Sons, Inc.

BUSINESS PERFORMANCE MANAGEMENT CYCLE AND IT MODEL

1-36

Copyright 2010 John Wiley & Sons, Inc.TOYOTA SCION’S INNOVATIVE

ADVERTISING STRATEGIES The Problem: Increasingly

competitive global marketplace for the automotive industry. Toyota with introduction of Scion goes directly up against General Motors and the Malibu for the position of #1 car manufacturer.

1-37

GM Vs.

Gen Y target marketWide

target market

Toyota

Copyright 2010 John Wiley & Sons, Inc.

TOYOTA SCION’S INNOVATIVE ADVERTISING STRATEGIES (CONTINUED)

Toyota known for its manufacturing innovations.

Aggressive web-presence strategy. Generation Y population, those born

1980-1994, expected to be a bigger consumer base than the Baby Boomers and the target market of the Scion.

1-38

Copyright 2010 John Wiley & Sons, Inc.

TOYOTA SCION’S INNOVATIVE ADVERTISING STRATEGIES (CONTINUED)

The Solution: Segmented advertising major media-based strategy.

Search engine marketing products – see demo example by clicking this image:

Toyota uses Scion Campaign Has Personality-Driven Ads to reach future customers at a very young age according to

1-39

Copyright 2010 John Wiley & Sons, Inc.

TOYOTA SCION’S INNOVATIVE ADVERTISING STRATEGIES (CONTINUED)

Toyota Uses Chat to Promote Scion – smart strategy to tap into the social networks of 18 to 24 year old audience.

Various providers of live chat software exist such as:

1-40

Chapter 1

DIGITAL ECONOMY – “NEW” ECONOMY

E-Business: The use of electronic technologies to transact business

Collaboration: People and Organizations interact, communicate, collaborate, and search for information

Information Exchange: Storing, processing and transmission of information

41

Chapter 1

DIGITAL ECONOMY

Based on digital technologies (networking, communication etc.) that provide the platform (infrastructure) over which people and organizations interact and collaborate. Digitized products Digitized financial transactions Everyday objects and appliances equipped with

computing capabilities

42

DIGITAL BUSINESSChapter 1

43

Chapter 1

MAJOR IT CHARACTERISTICS IN THE DIGITAL ECONOMY

Globalization Digital systems Speed (need for real-time transactions) Information overload Markets moving on-line New business models High rate of obsolescence New types of fraud and crimes

44

Chapter 1

DOING BUSINESS IN THE DIGITAL ECONOMY

The digital economy is an economy based on digital technologies, including communication networks

Also called the Internet economy, the new economy, or the Web economy

Digital infrastructures provide a global platform over which people and organizations interact, communicate, collaborate, and search for information.

45

Chapter 1

THE GLOBAL PLATFORM OF THE NEW ECONOMY

digitizable products; products that can be converted to digital

format. books, movies, magazines, TV and radio

programming, electronic games, music CDs, and computer software.

Consumers and firm conducting financial transaction digitally.

Physical goods such as home appliances and automobiles that contain embedded computer chips and connectivity capabilities.

46

Chapter 1

ELECTRONIC BUSINESS

Businesses increasingly perform their basic functions: buying and selling goods and services, servicing customers, and collaborating with business partners electronically

This process is known as electronic business (E-business) or electronic commerce (E-commerce)

47

NEW ECONOMY VS. OLD ECONOMY

Example Old New

Buying and selling textbook Visit the bookstore Visit web site for

publishers and retailers

Registering for classesWalk around campus to Departments, Registrar’s office, etc.

Access campus web site

Photography Buy film, use camera, take picture, take it for processing

Use digital camera

Paying for GasolineFill up your car, go inside, pay cash or credit card

Use speed pass token; wave over the sensor and go

Paying for Transportation Pay cash, metal tokens Metro cards electronic cards

Chapter 1 48

Chapter 1

BUSINESS MODELS A business model is a method of doing

business by which a company can generate revenue to sustain itself.

The model spells out how the company adds value to create a product or service.

Nokia makes and sells cell phones A TV station provides free broadcasting. Its

survival depends on a complex model involving advertisers and content providers

Internet portals, such as Yahoo, also use a complex business model.

49

Chapter 1

BUSINESS MODELS

To define a business model we need to describe: Products and services Business processes Customers and their value proposition Supply chain Revenue model

50

Chapter 1

DIGITAL AGE BUSINESS MODELS

Reverse Auctions Affiliate Marketing E-Marketplaces and Exchanges

51

Chapter 1

DRIVERS FORCING CHANGES IN BUSINESS MODELS

Environmental, organizational, and technological factors

React frequently and quickly to both the threats and the opportunities resulting from this new business environment

A response can be a reaction to a pressure already in existence, an initiative intended to defend an organization against

future pressures, an activity that exploits an opportunity created by changing

conditions

52

Business Pressures

Business Critical Response Activities

Chapter 1 53

THE DRIVERS OF CHANGE

Market

Society

Technology

Chapter 1

BUSINESS PRESSURES, ORGANIZATIONAL RESPONSES, AND IT SUPPORT

Business Pressure - The business environment is the combination of social, legal, economic, physical, and political factors that affect business activities

Significant changes in any of these factors are likely to create business pressure on the organization

The three types of business pressures faced are: market, technology, and societal pressures.

54

Chapter 1

ORGANIZATIONAL RESPONSES

Strategic Systems: enable organizations to increase market share and/or profits.

Customer Focus enable organizations to provide superb customer service and prevent losing customers to competitors.

55

Chapter 1

ORGANIZATIONAL RESPONSES (CONTINUED)

Make-to-Order is a strategy of producing customized products and services

Mass Customization is producing a large quantity of items, but customizing them to fit the desire of each customer

E-business and E-commerce is the strategy of doing business electronically

56

Chapter 1

INFORMATION SYSTEM An information system (IS) collects,

processes, stores, analyzes, and disseminates information for a specific purpose.

Like any other system, an information system includes inputs (data, instructions) and outputs (reports, calculations).

It processes the inputs by using technology such as PCs and produces outputs that are sent to users or to other systems via electronic networks and a feedback mechanism that controls the operation.

57

Chapter 1

INFORMATION SYSTEM IS A SYSTEM58

Chapter 1

COMPUTER BASED INFORMATION SYSTEM

Hardware Software Data Network Procedures People

59

Hardware

Software

PeopleData

Application

More than hardware and software

Chapter 1

THE ADAPTIVE, REAL-TIME ENTERPRISE

Recognizes environmental and organizational changes as, or even before, they occur

Deals with changes properly and correctly

Does not wait for competitors to introduce change (1st mover strategy)

Develop an innovation culture Have a scalable and appropriate IT

infrastructure

60

Chapter 1

PORTER’S COMPETITIVE FORCES MODEL61

Chapter 1

STRATEGIES OF COMPETITIVE ADVANTAGE

Porter: Cost leadership Differentiation Niche market

Other strategies Growth Alliance Innovation Operational effectiveness Customer orientation Entry barriers Lock in customers or suppliers Increase switching costs

62

Chapter 1PORTER’S VALUE CHAIN

63

Chapter 1

MANAGERIAL ISSUES64

Recognizing opportunities for using IT and Web-based systems.

Who will build, operate, and maintain the information systems. How much IT?

How much and HOW important is IT?

Is the situation going to change?

Globalization.

Chapter 1

MANAGERIAL ISSUES (CONTINUED)65

Ethics and social issues.

Transforming the organization to the digital economy.