Systems and Strategy By Shamira Dias Introduction Begins with system planning activity that determines which projects are started according to the needs of the enterprise Enables business plan to be translated into developed computer system to meet business goals Business goal Relate to profit, or growth, or market share but also focus on customer services and safety or staff development. Identify of key results areas which specify in turn the need for new systems Necessary to explore the wider context of how information systems fit into business strategy 1
Introduction 2
Cost / Benefit Analysis The Cost/Benefit analysis part of the business case presents a description and where possible a quantification of the costs of carrying out the project and of the benefit that are expected to flow from it Basic Types of Project Selection Model Numeric Nonnumeric 3
Types of Project Selection Models: Nonnumeric Sacred Cow Operating Necessity Competitive Necessity Product Line Extension Comparative Benefit Model Nonnumeric Model The Sacred cow In this case the project is suggested by a senior and powerful official in the organization The operation necessity if the flood is threatening the plant a project to build a protective dike does not require much formal evaluation The competitive necessity 4
Nonnumeric Model The production line extension The Comparative benefit model Numeric Project Selection Models: Profit / Profitability Payback Period (PB) Average Rate of Return Discounted Cash Flow (NPV) Internal Rate of Return Profitability Index 5
What is strategy all about Strategy is no about where do you want to go and how do you get there Strategy is not standing of an organization nor is it about the steps it should take Strategy is about stand Key questions who are you and what do you stand for What is strategy all about 6
What is strategy all about Developing a Strategy 7
Stakeholders Who are they What do they do? What do they value? Stakeholders Who are they What do they do? What do they value? Speaker Description Experienced New speaker Passionate Duties Register talk Upload slide Give talk Values Constructive feedback on talk Fast answer Group Work Currently there are 5 Cargill s super markets in Colombo. Project: They are going to start another 15 in other parts of Sri Lanka. Analyze the stakeholder of the project 8
SWOT Analysis Group Work Currently there are 5 Cargill s super markets in Colombo. Project: They are going to start another 15 in other parts of Sri Lanka. Analyze the project using SWOT 9
PESTEL Analysis PEST stands for political, economic, social and technological. Two more factors, the environmental and legal factors, are defined within the PESTEL analysis PEST analysis describes a framework of macroenvironmental factors used in the environmental scanning component of strategic management PESTEL Analysis Political factors consider how and to what degree a government intervenes in the economy. Economic factors include economic growth, interest rates, exchange rates and the inflation rate. These factors have major impacts on how businesses operate and make decisions. 10
PESTEL Analysis Social factors include the cultural aspects and include health consciousness, population growth rate, age distribution, career attitudes and emphasis on safety. Trends in social factors affect the demand for a company's products and how that company operates. Technological factors include technological aspects such as R&D activity, automation, technology incentives and the rate of technological change. PESTEL Analysis Environmental factors include ecological and environmental aspects such as weather, climate, and climate change, which may especially affect industries such as tourism, farming, and insurance. Legal factors include discrimination law, consumer law, antitrust law, employment law, and health and safety law. These factors can affect how a company operates, its costs, and the demand for its products. 11
Group Work Currently there are 5 Cargill s super markets in Colombo. Project: They are going to start another 15 in other parts of Sri Lanka. Analyze the project using PESTEL Competition and Strategy Porter s view is that the essence of strategy formulation is dealing with competition. He sees the competitive world as a violent environment within which the business position of an organization is determined by five forces acting on it. Porter s five forces model 12
Porter s Competitive Forces Model The model recognizes five major forces that could endanger a company s position in a given industry. The threat of entry of new competitors The bargaining power of suppliers The bargaining power of customers (buyers) The threat of substitute products or services The rivalry among existing firms in the industry Porter s Competitive Forces Model New entrants Threat of new entrants Suppliers Bargaining power of suppliers Industry competitors Bargaining power of buyers Buyers Intensity of rivals Threat of substitutes Substitutes 13
Porter s Competitive Forces Model Entry Barriers Economies of Scale Proprietary product differences Brand identity Switching Costs Capital Requirements Access to distribution Absolute cost advantages Proprietary learning curve Access to necessary inputs Proprietary low-cost product design Government policy Expected retaliation Suppliers New entrants Industry competitors Rivalry Determinants Industry Growth Fixed (or storage) costs/value added Product differences Brand identity Switching costs Concentration and balance Informal complexity Diversity of competitors Corporate stakes Exit barriers Buyers Determinants of Supplier Power Differentiation of inputs Switching costs of suppliers and firms in the industry Presence of substitute inputs Supplier concentration Importance of volume to supplier Cost relative to total purchases in the industry Impact of inputs on cost or differentiation Threat of forward integration relative to threat of backward integration by firms in the industry Intensity of rivals Substitutes Determinants of Substitution Threats Relative price/performance of substitutes Switching costs Buyer propensity to substitute Determinants of Buyer Power Buying Leverage Buyer concentration versus firm concentration Buyer volume Buyer switching costs relative to firm switching costs Buyer information Abilty to backward integrate Substitute products Pull-through Price Sensitivity Price total purchases Product differences Brand identity Impact on quality/performance Buyer profits Decision makers incentives Group exercise -Analyse the competitive forces of Cargills New entrants Suppliers Bargaining power of suppliers Industry competitors Threat of new entrants Bargaining power of buyers Buyers Intensity of rivals Threat of substitutes Substitutes 14
Porter s Competitive Forces Model - Cargills Bargaining Power of Suppliers Stassens Nestle, Unilever,etc, FMCG Companies (Hemas, P&G etc.) Importers Food Producers Potential New Entrants Foreign General Merchandisers Established Retailers shifting strategy to supermarkets Internet Vendors? Intra-Industry Rivalry Arpico Keells Super Premasiri Laugfs Kings, CWE, Other retailers Bargaining Power of Buyers Consumers (Rural) Consumers (Metropolitan) Substitute Products or Services Food Producers Kade / Pola Mobile produce Sellers Systems Sequential relationship 15
Project Management Frameworks Overlapping relationship 16
Lets Take Scrum 17
Scrum Elements and Artifacts Time box Elements - Release Plan meeting - Sprint Plan Meeting - Sprint - Daily Scrum Meeting - Retrospective - Sprit Review Principle Artifacts -Product Backlog -Sprint Backlog -Release burndown -Sprint burndown Project Kick-off 18
Sprint Sprint Planning 19
Daily Scrum Sprint Review 20
Sprint Retrospective 21
Maslow's hierarchy of needs 22