Monday, 8 July 2013


  • ·         What is a metric?

o   A metric is nothing more than a standard measure to assess performance in a particular area

  • ·         Metrics for measuring and managing strategic initiatives include:

o   Website metrics
o   Supply chain management (SCM) metrics
o   Customer relationship management (CRM) metrics
o   Business process reengineering (BPR) metrics
o   Enterprise resource planning (ERP) metrics

  • ·         Website metrics include:

o   Abandoned registrations
o   Abandoned shopping carts
o   Click-through
o   Conversion rate
o   Cost-per-thousand
o   Page exposures
o   Total hits
o   Unique visitors

  • ·         A supply chain is only as strong as its weakest link. The solution is to measure all key areas, which include:

o   Back order
o   Customer order promised cycle time
o   Customer order actual cycle time
o   Inventory replenishment cycle time
o   Inventory turns (inventory turnover)

  • ·         Customer relationship management metrics measure user satisfaction and interaction and include:

o   Sales metrics
o   Service metrics
o   Marketing metrics

  • ·         The balanced scorecard enables organizations to measure and manage strategic initiatives

  • ·         The balanced scorecard views the organization from four perspectives:

o   The learning and growth perspective
o   The internal business process perspective
o   The customer perspective
o   The financial perspective

  • Efficiency IT Metrics—Measures the performance of the IT system itself including throughput, speed, and availability

  • Effectiveness IT Metrics—Measures the impact IT has on business processes and activities including customer satisfaction, conversion rates, and sell-through

  • Efficiency IT metrics focus on technology and include:
    • Throughput
    • Transaction speed
    • System availability
    • Information accuracy
    • Web traffic
    • Response time

  • Effectiveness IT metrics focus on an organization’s goals, strategies, and objectives and include:
    • Usability
    • Customer satisfaction
    • Conversion rates
    • Financial

  • Security is an issue for any organization offering products or services over the Internet

  • It is inefficient for an organization to implement Internet security, since it slows down processing however, to be effective it must implement Internet security
    • Secure Internet connections must offer encryption and Secure Sockets Layers (SSL denoted by the lock symbol in the lower right corner of a browser)

Thursday, 4 July 2013


Supply Chain Management
  • ·        Involves the management of information flows among the stages in a supply chain to maximize total supply chain effectiveness and profitability
  • ·        Four basic components of supply chain management include:

-         Supply chain strategy – strategy for managing all resources to meet customer demand
-         Supply chain partner – partners throughout the supply chain that deliver finished products, raw materials, and services.
-         Supply chain operation – schedule for production activities
-         Supply chain logistics – product delivery process

Customer Relationship Management
  • ·        Involves managing all aspects of a customer’s relationship with an organization to increase customer loyalty and retention and an organization's profitability
  • ·        Many organizations, such as Charles Schwab and Kaiser Permanente, have obtained great success through the implementation of CRM systems
  • ·        CRM is not just technology, but a strategy, process, and business goal that an organization must embrace on an enterprisewide level
  • ·        CRM can enable an organization to:

-         Identify types of customers
-         Design individual customer marketing campaigns
-         Treat each customer as an individual
-         Understand customer buying behaviors

Business Process Reengineering
  • ·        Business process – a standardized set of activities that accomplish a specific task, such as processing a customer’s order
  • ·        Business process reengineering (BPR) – the analysis and redesign of workflow within and between enterprises

-         The purpose of BPR is to make all business processes best-in-class
  • ·        Reengineering the Corporation – book written by Michael Hammer and James Champy that recommends seven principles for BPR

1.     Organize around outcomes, not task
2.  Identify all organization’s processes and prioritize them in order of   redesign urgency.
3.  Integrate information processing work into the real work that produces the information.
4.  Treat geographically dispersed resources as though they were centralized.
5.  Link parallel activities in the workflow instead of just integrating their results.
6.  Put the decision point where the work is performed and build control into the process.
7.  Capture information once and at the source.

Finding Opportunity Using BPR
  • ·        A company can improve the way it travels the road by moving from foot to horse and then horse to car
  • ·        BPR looks at taking a different path, such as an airplane which ignore the road completely
  • ·        Types of change an organization can achieve, along with the magnitudes of change and the potential business benefit

Enterprise Resource Planning
  • ·        Enterprise resource planning (ERP) – integrates all departments and functions throughout an organization into a single IT system so that employees can make decisions by viewing enterprisewide information on all business operations
  • ·        Keyword in ERP is “enterprise”
  • ·        ERP systems collect data from across an organization and correlates the data generating an enterprisewide view


  • ·        A product or service that an organization’s customers place a greater value on than similar offerings from a competitor

  • ·        High – when buyers have many choices of whom to buy.
  • ·        Low – when their choices are few.
  • ·        To reduce buyer power (and create competitive advantage), an organization must make it more attractive to buy from the company not from the competitors.
  • ·        Best practices of IT-based
  •      -         Loyalty program in travel industry (e.g. rewards on free airline tickets or hotel stays )

  • ·        High – when buyers have few choices of whom to buy from.
  • ·        Low – when their choices are many.

-         Best practices of IT to create competitive advantage.
-         E.g. B2B marketplace – private exchange allow a single buyer to posts it needs and then open the bidding to any supplier who  would care to bid. Reverse auction is an auction format in which increasingly lower bids

  • ·        High – when there are many alternatives to a product or service.
  • ·        Low – when there are few alternatives from which to choose.
  • ·        Ideally, an organization would like to be on a market in which there are few substitutes of their product or services.

-         Best practices of IT
-         E.g. Electronic product -same function different brands

  • ·        High – when it is easy for new competitors to enter a market.
  • ·        Low – when there are significant entry barriers to entering a market.
  • ·        Entry barriers is a product or service feature that customers have come to expect from organizations and must be offered by entering organization to compete and survive.
  • ·        Best practices of IT

-         E.g. new bank must offers online paying bills, acc monitoring to compete.

  • ·        High – when competition is fierce in a market
  • ·        Low – when competition is more complacent
  • ·        Best Practices of IT

-         Wal-mart and its suppliers using IT-enabled system for communication and track product at aisles by effective tagging system.
-         Reduce cost by using effective supply chain.

  1. 1.     Cost Leadership

·        Becoming a low-cost producer in the industry allows the company to lower prices to customers. 
·        Competitors with higher costs cannot afford to compete with the low-cost leader on price.
  1. 2.     Differentiation

·        Create competitive advantage by distinguishing their products on one or more features important to their customers. 
·        Unique features or benefits may justify price differences and/or stimulate demand.
·        Ex: i-care by Proton
  1. 3.     Focused Strategy

·        Target to a niche market
·        Concentrates on either cost leadership or differentiation.

The Value Chains- Targeting Business Processes
  • ·        Supply Chain - a chain or series of processes that adds value to product & service for customer.
  • ·        Add value to its products and services that support a profit margin for the firm


Information Technology’s Impact on Business Operations
  • ·        Organizations typically operate by functional areas or functional silos
  • ·        Functional areas are interdependent

Information Technology Basics
  • ·        Information technology (IT) – a field concerned with the use of technology in managing and processing information.
  • ·        Management information systems (MIS) – a general name for the business function and academic discipline covering the application of people, technologies, and procedures  to solve business problems.

  • ·        Data - raw facts that describe the characteristic of an event
  • ·        Information - data converted into a meaningful and useful context
  • ·        Business intelligence – applications and technologies that are used to support decision-making efforts

IT Resources
  • ·        People use
  • ·        Information technology to work with
  • ·        Information

IT Cultures
  • ·        Functional Culture - Employees use information as a means of exercising influence or power over others.
  • ·        Sharing Culture  - Employees across departments trust each other to use information (especially about problems and failures) to improve performance.
  • ·        Inquiring Culture - Employees across departments search for information to better understand the future and align themselves with current trends and new directions.
  • ·        Discovery Culture - Employees across departments are open to new insights about crisis and radical changes and seek ways to create competitive advantages.

Monday, 1 July 2013