Management information system - Introduction

Introduction to Management Information System for MBA students

1. Management Information System Prof: Jaya Shankar Singh

2. Module 1 Prof: Jaya Shankar Singh

3. Tech's Tectonic Shift: Radically Changing Businesses Modern businesses are undergoing transformative changes due to rapid advancements in technology. These shifts are reshaping industries and creating new opportunities and challenges. Key Themes Digital Transformation Disruption and Innovation Global Connectivity Data as a Strategic Asset Cybersecurity and Privacy

4. Tech's Tectonic Shift: Radically Changing Businesses Digital Transformation Companies must adapt to a digital-first approach, leveraging technologies like cloud computing, AI, and big data to stay competitive. Disruption and Innovation Traditional business models are being disrupted by innovative startups and technological advancements. Companies need to innovate continuously to survive and thrive. Global Connectivity The internet and mobile technologies have connected the world, enabling businesses to reach global markets and collaborate across borders. Data as a Strategic Asset Data analytics provides insights that drive decision-making and strategy. Businesses that harness data effectively gain a significant competitive edge. Cybersecurity and Privacy As reliance on technology grows, so does the importance of protecting data and ensuring privacy. Cybersecurity has become a critical component of business strategy.

5. Tech's Tectonic Shift: Radically Changing Businesses Impact on Industries Various industries, from retail to healthcare, are experiencing profound changes. For example, e-commerce is revolutionizing retail, while telemedicine and digital health records are transforming healthcare. Adapting to Change Organizations must cultivate a culture of agility and continuous learning. Investing in employee training and development is essential to keep pace with technological advancements. Conclusion Embracing technological change is imperative for businesses. Those that adapt quickly and strategically will be well-positioned to capitalize on the opportunities presented by the evolving digital landscape.

6. Elevated Service Expectations Instantaneous Communication: Social media and the internet have set a precedent for immediate responses and real-time customer service. Customers now expect swift and efficient handling of their inquiries and issues. 24/7 Availability: The global reach of the internet means that businesses are expected to be available around the clock. This necessitates robust online support systems and sometimes, the use of AI-driven chatbots.

7. Elevated Ethical Standards Transparency: The pervasive nature of social media means that any business action can be scrutinized publicly. Companies are expected to operate transparently and maintain open communication channels with their stakeholders. Accountability: With the increased visibility, businesses are held accountable for their actions more than ever. Ethical lapses can quickly lead to public backlash and damage to reputation. Corporate Social Responsibility (CSR): There is a growing expectation for businesses to contribute positively to society and the environment. CSR initiatives are increasingly becoming a norm, driven by social media advocacy and consumer awareness.

8. Elevated Ethical Standards Data Privacy and Security: The digital age has brought data privacy to the forefront. Companies must ensure they are compliant with regulations like GDPR and prioritize the protection of customer data to maintain trust. By understanding and addressing these heightened expectations and ethical considerations, managers can better navigate the complexities of the modern business landscape.

9. Reflection Break How is social media impacting firms, individuals, and society? How do recent changes in computing impact consumers? Are these changes good or bad? Explain. How do they impact businesses? What kinds of skills do today’s managers need that weren’t required a decade ago? What are some examples of companies that have successfully innovated in response to industry disruption? How can managers balance transparency and accountability with the need to protect sensitive business information? Decide ways in which your class can use social media.

10. Geek Up: Tech Is Everywhere and You'll Need It to Thrive Technology's Pervasiveness: Technology is integral to almost every aspect of modern business operations. From daily tasks to strategic decision-making, tech tools and systems are essential for efficiency and competitiveness. Managerial Necessity : Managers must be tech-savvy to effectively oversee and guide their teams. Understanding and leveraging technology can drive innovation, streamline processes, and enhance decision-making. Digital Transformation : Embracing technology is crucial for digital transformation. Companies that adapt to technological changes can better meet market demands and stay ahead of competitors.

11. Geek Up: Tech Is Everywhere and You'll Need It to Thrive Tech Trends and Tools : Key technology trends such as cloud computing, big data analytics, and artificial intelligence are reshaping business landscapes. Familiarity with these tools can provide significant advantages in operational efficiency and strategic planning. Challenges and Opportunities : While technology offers numerous benefits, it also presents challenges such as cybersecurity threats and the need for continuous learning. Managers must balance the opportunities and risks associated with tech advancements. Continuous Learning : Staying updated with technological advancements is essential for managers. Lifelong learning and adapting to new tech trends are vital for maintaining a competitive edge and fostering innovation within the organization.

12. Section II Strategy and Technology

13. Learning Objectives Define operational effectiveness and understand the limitations of technology-based competition leveraging this principle. Define strategic positioning and the importance of grounding competitive advantage in this concept. Understand the resource-based view of competitive advantage. List the four characteristics of a resource that might possibly yield sustainable competitive advantage.

14. Introduction to Strategy and Technology Brief Overview of the Section: The introduction emphasizes the crucial role of technology in shaping modern business strategies and differentiating successful companies from others. Importance of Integrating Strategy and Technology: Companies that successfully integrate technology into their strategic planning can achieve superior performance and competitive advantage. Technology impacts all aspects of business, from operational efficiency to customer engagement and market positioning.

15. Key Concepts in Strategy and Technology Definition of Strategy in the Context of Technology: Strategy involves setting long-term goals and determining the best way to achieve them. In the context of technology, it means leveraging technological tools and innovations to drive business success. The Role of Technology in Shaping Business Strategy: Market Entry : Identifying new market opportunities through data analytics. Customer Engagement: Using CRM systems and social media platforms to connect with customers. Product Development : Employing R&D and innovation labs to create new products and services.

16. Key Concepts in Strategy and Technology Examples of Companies Leveraging Technology for Strategic Advantage: Amazon: Uses advanced data analytics and AI to optimize supply chain and personalize customer experiences. Tesla: Leverages cutting-edge battery technology and autonomous driving innovations to lead the electric vehicle market. Airbnb: Utilizes a robust online platform and data analytics to match hosts with guests, creating a scalable and efficient business model.

17. Competitive Advantage Competitive advantage is the ability of a company to outperform its rivals by being more efficient, offering unique products or services, or achieving higher customer satisfaction. Competitive advantage arises when a company can produce goods or services more efficiently, uniquely, or effectively than its competitors. This advantage can result in higher margins, greater market share, and increased customer loyalty. How Technology Can Create and Sustain Competitive Advantage: Cost Leadership: Automation and process improvements reduce operational costs. Differentiation : Innovative products and services set a company apart from its competitors. Focus Strategy: Technology enables firms to target niche markets more effectively.

18. Value Chain and Technology Developed by Michael Porter, the value chain model identifies primary and support activities that create value for a company. Primary activities include inbound logistics, operations, outbound logistics, marketing and sales, and service. Support activities include firm infrastructure, human resource management, technology development, and procurement.

19. Value Chain - Primary Inbound Logistics : Automated systems streamline supply chain processes and improve inventory management. Operations: Advanced manufacturing technologies and automation increase efficiency and product quality. Outbound Logistics : Real-time tracking systems ensure efficient distribution and delivery. Marketing and Sales : Digital platforms and CRM systems enable targeted marketing and better customer engagement. Service : AI and online support tools provide efficient customer service."

20. Value Chain - Secondary Firm infrastructure —functions that support the whole firm, including general management, planning, IS, and finance Human resource management —recruiting, hiring, training, and development Technology / research and development —new product and process design Procurement —sourcing and purchasing functions

21. Imitation Resistant Value Chain Imitation-resistant value chains are the backbone of sustainable competitive advantage. They represent a unique way of doing business that is difficult for competitors to replicate. Imitation Resistance: When a company's value chain is difficult to copy and provides significant advantages. Technology : Often a key enabler of imitation-resistant value chains.. Strategic Analysis: Understanding a firm's value chain can reveal strengths, weaknesses, and opportunities for improvement. Technology and Value Chain: Technology can enhance efficiency but can also homogenize processes, potentially eroding competitive advantage.

22. Dell's Rise and Fall: A Strategic Lesson Dell's Dominance Efficient Model: Dell's direct-to-consumer, vertically integrated model generated significantly higher profits compared to rivals. Price Advantage: Lower costs allowed Dell to initiate price wars while maintaining better margins. Model Resilience: Rivals struggled to imitate Dell's model due to retailer dependence.

23. Dell's Rise and Fall: A Strategic Lesson The Decline Eroding Advantages : Improvements in contract manufacturing and component supply reduced Dell's cost advantage. Shifting Market: The rise of notebooks, which favored in-person comparison, weakened Dell's direct-to-consumer model. Competitive Pressure : Rivals capitalized on Dell's vulnerabilities, leading to a loss of market leadership.

24. Dell's Rise and Fall: A Strategic Lesson Key Takeaway Dynamic Market : The business landscape is constantly evolving, requiring continuous strategic evaluation. Model Adaptation: Even highly successful business models may become obsolete over time. Customer Focus: Understanding changing customer preferences is crucial for long-term success.

25. Barriers to Entry, Technology, and Timing Low Entry Barriers vs. Sustainable Advantage : Low barriers to entry don't guarantee success. Building resources for long-term advantage is crucial. Timing and Technology as Enablers: First-mover advantage is valuable when used to create difficult-to-replicate resources like brand, scale, network effects, and switching costs. Execution and Resource Development : Simply being first isn't enough. Companies need to leverage their initial advantage to build valuable resources. Incumbent Challenges: Established companies often fail to recognize new rivals or react effectively to their innovations. The "Google Anomaly ": Google wasn't the first search engine, but it capitalized on Yahoo!'s complacency to build key resources and win the market.

26. Barriers to Entry, Technology, and Timing New entrants may struggle to compete despite easy market entry if they can't create strong resources. First-mover advantage isn't a myth, but it depends on how the lead is used. Constant vigilance is essential for established firms to monitor new rivals and respond effectively. Don't be misled by statements like "IT doesn't matter" or "follow, don't lead." These oversimplify the complex relationship between timing, technology, and competitive advantage.

27. The Five Forces of Industry Competitive Advantage One of the most popular frameworks for examining a firm’s competitive environment is Porter’s five forces also known as the Industry and Competitive Analysis . Porter : “analyzing [these] forces illuminates an industry’s fundamental attractiveness, exposes the underlying drivers of average industry profitability, and provides insight into how profitability will evolve in the future.”

28. The Five Forces of Industry Competitive Advantage

29. Porter’s Five Forces Industry competition and attractiveness can be described by considering the following five forces: (1) the intensity of rivalry among existing competitors, (2) the potential for new entrants to challenge incumbents, (3) the threat posed by substitute products or services, (4) the power of buyers, and (5) the power of suppliers. In markets where commodity products are sold, the Internet can increase buyer power by increasing price transparency. The more differentiated and valuable an offering, the more the Internet shifts bargaining power to sellers. Highly differentiated sellers that can advertise their products to a wider customer base can demand higher prices. A strategist must constantly refer to models that describe events impacting their industry, particularly as new technologies emerge.

30. Applying Porter’s Five Forces in Music Industry The rise of the Internet has dramatically transformed the competitive dynamics in the music retail industry, illustrating the impact of new technologies on Porter's five forces model: Intensity of Rivalry : Traditional music retailers like Tower and Virgin face increased competition as they now contend with online platforms such as Amazon. The rivalry is not just geographic but global, making it more intense. Online investments are costly and uncertain, pushing some firms to partner with new entrants. Threat of New Entrants : Online retailers, especially those free from physical store constraints like Amazon, have a scalable cost structure that traditional retailers struggle to match. This has intensified competition as new entrants exploit the benefits of e-commerce, such as a vast selection and superior customer experience.

31. Applying Porter’s Five Forces in Music Industry Threat of Substitutes: Physical CDs face competition from digital music files and streaming services. Although digital music often offers lower sound quality compared to CDs, the convenience of accessing thousands of songs through devices like the iPod has shifted consumer preferences. Additionally, illegal music sharing has further eroded CD sales, with industry revenue dropping significantly. Bargaining Power of Buyers: Consumers have more bargaining power due to the increased availability of music through various online channels. They demand lower prices and greater convenience, which has pressured retailers and labels to adapt. Bargaining Power of Suppliers: With traditional retailers struggling and many going bankrupt, music labels and artists have gained more leverage. They can experiment with new distribution methods and connect directly with fans, sometimes bypassing traditional music labels.

32. Reflection Break How does your organization leverage technology for strategic advantage? Can you identify any disruptive technologies in your industry? Is there such a thing as the first-mover advantage? Why or why not? Why did Google beat Yahoo! in search? What are the key technological resources that provide your company with a competitive edge? What is price transparency? What is information asymmetry? How does the Internet relate to these two concepts? How does the Internet shift bargaining power among the five forces? Use the five forces model to illustrate competition in the newspaper industry. Are some competitors better positioned to withstand this environment than others? Why or why not? What role do technology and resources for competitive advantage play in shaping industry competition?

33. Thank You