INFORMATION SYSTEMS FOR MANAGERS

Transcription

1 INFORMATION SYSTEMS FOR MANAGERS TEXT & CASES GABRIELE PICCOLI /Universita di Sassari WILEY John Wiley & Sons, Inc.

2 CONTENTS PREFACE vii FOREWORD xi 1 I PART I FOUNDATIONS 1 CHAPTER 1 Information Systems and the Role of General and Functional Managers 3 Introduction 5 General and Functional Managers 6 General and Functional Managers versus End Users 9 The Next Wave of CIOs 10 Fundamental IT Trends: The Staying Power of Moore's Law 12 Processing Power and Memory Increase 13 Costs of Computing Power Decline 14 Computers Have Become Easier to Use 16 Other IT Trends of Managerial Interest 16 Declining Storage Costs 17 Ubiquitous Network Access 17 Ubiquitous Computing and Digital Data Genesis 17 How Do These Trends Affect Today's Managers? 21 Why Can't We Just Hire Good IT People? 22 Summary 23 Study Questions 23 Further Readings 24 Glossary 24 CHAPTER 2 Information Systems Defined 25 Introduction 26 Information Systems: Definition 27 IS, Not IT 27 Information Systems as Sociotechnical Systems 28 The Four Components of an Information System 29 Systemic Effects 32 Why Do Organizations Build Information Systems? 33 xm

3 xiv CONTENTS Successful Information Systems 34 Information Systems Outcomes 38 Information Systems in the Organizational Context 39 Every Organization is Unique 39 Bringing It All Together 40 Information Systems and Organizational Change 41 First-Order Change: Automate 41 Second-Order Change: Informate 42 Third-Order Change: Transform 43 Culture and Information Systems 45 National Culture 45 Organizational Culture and National Culture 46 How Culture Impacts Structure 47 Implications 49 Don't Put the Cart before the Horse 49 The Rock in the Pond 50 Information Systems Are in Flux 50 Conclusion 51 Summary 51 Study Questions 51 Further Readings 52 Glossary 52 Case Study: Troubleshooting Information Systems at the Royal Hotel 52 CHAPTER 3 Organizational Information Systems and Their Impact 58 Introduction 59 Categorizing Systems 60 Hierarchical Perspective 60 Functional Perspective 64 Process Perspective 65 The Information System Cycle 69 The Integration Imperative 70 Defining Integration 70 The Dimensions of Integration 70 Enterprise Systems 73 The Genesis of Enterprise Systems 73 Enterprise Systems: Definition 75 The Advantages of Enterprise Systems 78 The Limitations of Enterprise Systems 79 Supply Chain Management " 83 A Brief History of Supply Chain Management 84 Modern Supply Chain Management 85 Knowledge Management 87 Knowledge: Definition 87 Knowledge Management: Definition 89

4 CONTENTS XV ] 1 Business Intelligence 90 Business Intelligence: Definition 92 Components of the Business Intelligence Infrastructure 93 The Evolution of Business Intelligence 96 Customer Relationship Management 97 Aspects of CRM 97 The Limitations of CRM 99 Best-of-Breed Integration 99 Enterprise Application Integration (EAI) 100 Ultimate Flexibility: Service-Oriented Architecture 100 Integration: Concluding Remarks 102 Summary 103 Study Questions 104 Further Readings 104 Glossary 105 Case Study: Hilton Hotels Brand Differentiation through Customer Relationship Management 106 PART II COMPETING IN THE INTERNET AGE 119 CHAPTER 4 The Changing Competitive Environment 121 Introduction 122 Network Economics 123 Networks Are Different: Value in Plentitude 124 Physical and Virtual Networks 124 Key Concepts and Vocabulary 126 Two-Sided Networks 134 Implications for General and Functional Managers 134 The Economics of Information 137 Data and Information 138 Classic Information Goods 138 The Economic Characteristics of Information 139 Implications 143 Information-Intensive Goods 144 Information in Networks 146 The Richness and Reach Trade-Off 147 Implications 149 Obstacles 151 The Internet Changes Everything? 153 A Note about Disruptive Technology 154 Sustaining Technology 154 Disruptive-Technology 155 Implications for Managers 156 What to Do? 157 Summary 158

5 XVI CONTENTS Study Questions 159 Further Readings 159 Glossary 159 Case Study: Online Education 160 CHAPTER 5 Electronic Commerce: New Ways of Doing Business 163 Introduction 166 The Internet 166 Internet Services 168 Distributed Ownership 168 Multiplicity of Devices 169 Open Standards 170 The Network, More than the Internet of Today 170 The ecommerce Vocabulary 172 ecommerce and ebusiness 173 The Enablers 173 Categorizing Electronic Commerce Initiatives 174 Manifestations of ecommerce and ebusiness 180 Business Models: Definition 180 Dominant Business Models 184 The Implications of ecommerce 188 Disintermediation 188 Reintermediation 189 Market Efficiency 189 Channel Conflict 189 Customer and Employee Self-Service 191 ecommerce: From Novelty to the Mainstream 191 The Web 2.0 Phenomenon 192 Web 2.0 Technologies 196 Web 2.0 and Business Innovation 201 Summary 203 Study Questions 203 Further Readings 204 Glossary 204 Case Study: STA Travel Island Marketing First Life Travel Services in Second Life 205 PART III THE STRATEGIC USE OF INFORMATION SYSTEMS 209 CHAPTER 6 Strategic Information Systems Planning 211 Introduction 212 A Word About Strategic and Operational Planning 213 Strategic Alignment 213

6 CONTENTS XV11 Six Decisions Requiring Managerial Involvement 215 The Purpose of Strategic Information Systems Planning 217 Plans Enable Communication 217 Plans Enable Unity of Purpose 218 Plans Simplify Decision Making over Time 218 The Strategic Information Systems Planning Process 218 Know Who You Are: Strategic Business Planning 219 Know Where You Start: Information Systems Assessment 219 Know Where You Want to Go: Information Systems Vision 221 Know How You Are Going to Get There: Information Systems Guidelines 226 Know How Well-Equipped You Are to Get There: Information Systems SWOT 230 From Planning to Action: Proposed Strategic Initiatives 231 Summary 231 Study Questions 232 Further Readings 232 Glossary 232 Case Study: Outrigger Hotels and Resorts 233 CHAPTER 7 Value Creation and Strategic Information Systems 249 Introduction 250 The Analysis of Added Value 251 The Benefits of Disciplined Analysis 252 The Definition of Value 252 Defining the Components of Value Created 253 Computing the Total Value Created 254 Appropriating the Value Created 256 The Definition of Added Value 257 Added Value in a Competitive Market 258 Pricing Considerations 258 The Relationship between Added Value and Competitive Advantage 259 How Is Added Value Created? 259 Two Ways to Create New Value 260 Some Considerations About the Analysis of Added Value 261 Strategic Information Systems 263 Definition: Strategic Information Systems 263 IT-Dependent Strategic Initiatives 265 Summary 267 Study Questions 268 Further Readings 268 Glossary 268 Case Study: Upscale Markets Value Creation In a Mature Industry 269

7 XViii CONTENTS i CHAPTER 8 Value Creation with Information Systems 277 Introduction 280 Traditional Models of Value Creation with IT 280 Industry Analysis 280 Value Chain 285 Customer Service Life Cycle 289 Traditional Models, Not "Old" Models 297 Emerging Frameworks 297 Virtual Value Chain 298 Value Creation with Customer Data 304 Crafting Data-Driven Strategic Initiatives 312 Conclusions 315 Summary 315 Study Questions 316 Further Readings 316 Glossary 317 Case Study: Carnival Cruise Lines 317 CHAPTER 9 Appropriating IT-Enabled Value Over Time 344 Introduction 345 Not All IT is Created Equal 346 High-Speed Internet Access in Hotel Rooms 346 Business Intelligence at Caesars Entertainment 347 The Need for A Priori Analysis 348 Appropriating Value Over Time: Sustainability Framework 348 Sustainable Competitive Advantage 348 Resource Based View 349 Response Lag 350 Four Barriers to Erosion 350 The Holistic Approach 360 The Dynamics of Sustainability 361 Applying the Framework 363 Prerequisite Questions 363 Sustainability Questions 364 What Evolutionary Paths Does the Innovation Create? 366 Making Decisions 367 Develop the IT-Dependent Strategic Initiative Independently 367 Develop the IT-Dependent Strategic Initiative as Part of a Consortium Shelve the IT-Dependent Strategic Initiative 367 Summary 368 Study Questions 368 Further Readings 369 Glossary 369 Case Study: Custom Made Apparel and Individualized Service at Lands' End

8 CONTENTS XIX PART PV GETTING IT DONE 381 1CHAPTER 10 Funding and Governance of Information Systems 383 Introduction 384 Information Systems Governance 385 Steering Committee 386 Funding Information Systems 387 Chargeback 387 Allocation 387 Overhead 388 The Budgeting and Project Prioritization Process 388 Making the Budget 388 Funding Information Systems Projects: Making the Business Case 390 Individual Project Risk 396 Portfolio Management 397 Outsourcing 398 Drivers of Outsourcing 399 The Risks of Outsourcing 399 Offshoring 400 Making Optimal Outsourcing Decisions 400 Summary 401 Study Questions 402 Further Readings 402 Glossary 403 Case Study: IT Planning at ModMeters 403 CHAPTER 11 Creating Information Systems 406 Introduction 40/ How Hard Can IT Be? 408 Fulfilling Information Processing Needs 410 Three Approaches 410 Make versus Buy 411 Buy and Make 414 Build Your Own: Systems Design and Development 414 Systems Development Life Cycle 414 Prototyping 421 Agile Development 423 Outsourced Development 424 Buying Off-the-Shelf Applications 426 Definition 426 Build 429 Implementation 429 End-User Development 430 The Benefits of End-User Development 430 The Risks of End-User Development 430

9 XX CONTENTS 1 Summary 431 Study Questions 432 Further Readings 433 Glossary 433 Case Study: Project Management at MM 434 CHAPTER 12 Information Systems Trends 437 Introduction 439 The Mobile Platform 440 Characteristics of the Mobile Platform 442 Mobile Commerce 443 Location-Based Social Networking 444 Augmented Reality 445 Green IS 447 Digital Data Genesis 448 Analyzing Digital Data Genesis Opportunities 452 The Advent of Supercrunchers 453 Customer-Managed Interactions 454 Open Source 456 Open Source: Definition 456 Open Source Is Open for Business 457 Advantages and Disadvantages of Open Source Software 458 Software as a Service 460 Historical Context 461 SaaSToday /462 Cloud Computing- 464 Summary 466 \^ Study Questions 466 Further Readings 467 Glossary 467 Case Study: Triplt The Traveler's Agent 467 CHAPTER 13 Security, Privacy, and Ethics 487 Introduction 489 IT Risk Management and Security 490 Why Is Security Not an IT Problem? 491 Risk Assessment 492 Risk Mitigation 493 The Internal Threat 494 The External Threat 495" Responding to Security Threats 501 Managing Security: Overall Guidelines 504

10 CONTENTS XXI Index 525 Privacy 506 Privacy Defined 507 Privacy Risks 507 Safeguarding Privacy 510 Ethics 511 Ethics: Definition 511 Information Systems Ethics 512 Ensuring Ethical Uses of Information Systems 513 Summary 514 Study Questions 515 Further Readings 515 Glossary 515 Case Study: Giant Food and Elensys Looking Out for Customers or Gross Privacy Invasions? 516