VALUING ORGANIZATIONAL INFORMATION

Organizational Information

# Information Granularity

= Refers to the extent of detail within the information which are fine and detailed or coarse and abstract information.

• Levels, format, and granularities of organizational information.

Additional characteristics that help determine the value of information :

# The value of Transactional and Analytical Information

~ Transactional Information

= Encompasses all of the information contained within a single business process to support the performing of daily operational tasks. Organization capture and store transactional info in database and use it when performing operational tasks and repetitive decisions.

* Example : withdrawing cash from ATM, making airline reservation and purchasing stock.

~ Analytical Information
= Encompasses all organizational information and its primary purpose is to support the performing of managerial analysis tasks. It also used when making an important ad hoc decisions.

 * Example : trends, sales, product statistics, future growth projections.

•  Transactional information verses analytical information

# The Value of Timely Information

• Timeliness is an aspect of information that depends on the situation.

~ Real-time information

= Immediate, up-to-date information

~ Real-time system

= Provides real-time information in response to query requests.

• Timely Information is relative to each business decision and some of this decisions require weekly information while other may require daily information.
• Organizational such as 911 centers, stock trader and banks require up-to-the-second information.

# The Value of Quality Information

~ Characteristics of high-quality information include :

> Accuracy

 = Are all the values correct ?

* Example : is the name spelled correctly? is the dollar amount recorded properly?

> Completeness

= Are any of the values missing?

* Example : Is the address complete including the street, city, state and zip code?

> Consistency

= Is aggregate or summary information in agreement with detailed information?

* Example : Do all total fields equal the true total of the individual fields?

> Uniqueness

= Is each transaction, entity and event represented only once in the information?

*  Example : Are there any duplicate customers?

> Timeliness

= Is the information current with the respect to the business requirements?

* Example : Is information updated weekly,daily or hourly ?

~ Low quality information example

 # Understanding the Costs of Poor Information

~ The four primary sources of low quality information include :

• Online customers intentionally enter inaccurate information to protect their privacy.
• Information from different systems have different entry standards and formats
• Call center operators enter abbreviated or erroneous information by accident or to save time.
• Third party and external information contains inconsistencies, inaccuracies and errors.

~ Potential business effects resulting from low quality information include :

• Inability to accurately track customers
• Difficulty identifying valuable customers
• Inability to identify selling opportunities
• Marketing to non-existent customers
• Difficulty tracking revenue due to inaccurate invoices
• Inability to build strong customer relationships.

# Understanding the Benefits of Good Information

• High quality information can significantly improve the chances of making a good decision.
• Good decisions can directly impact an organization's bottom line.

ORGANIZATIONAL STRUCTURE THAT SUPPORT STRATEGIC INITIATIVES

Organizational Structures

• Organizational employees must work closely together to develop strategic initiatives that create competitive advantages.

• Ethics and security are two fundamental building blocks that organizations must base their business upon.

IT Roles and Responsibilities

• Information technology is a new functional area and it has been around formally around 40 years.

# Recent IT-related strategic positions :

~ Chief Information Officer ( CIO )

= Oversees all uses of IT and ensures the strategic alignment of IT with business goals and objectives.

= Broad CIO function include :

• Manager -ensuring the delivery of all IT projects on time and within budget.
• Leader - ensuring the strategic vision of IT is in line with the strategic vision of the organization
• Communicator - building and maintaining strong executive relationships.

• Average CIO compensation by industry

• Concerns of CIOs 

~ Chief Technology Officer ( CTO)

=  Responsible for ensuring the throughput, speed, accuracy, availability and reliability of IT.

~ Chief Security Officer ( CSO)

=  Responsible for ensuring the security of IT systems.

~ Chief Privacy Officer ( CPO)

= Responsible for ensuring the ethical and legal use of information.

~ Chief Knowledge Office ( CKO)

= Responsible for collecting, maintaining and distributing the organization's knowledge.

• Skill pivotal for success in executive IT roles

The Gap Between Business Personnel and IT Personnel.

# Business personnel

* Possess expertise in functional areas such as marketing, accounting and sales.

# IT Personnel

* Have the technological expertise.

Because of this issue it create a communications gap between the business personnel and IT personnel.

Improving Communication

# Business Personnel 

*  Must seek to increase their understanding of IT

# IT Personnel

* Must seek to increase their understanding of the business.

It is the responsibility if the CIO to ensure effective communication between business personnel and IT personnel.

Organizational Fundamentals Ethics and Security

•   Ethics and security are two fundamental building blocks that organizations must base their businesses on to be successful.

# Ethics

=  The principles and standards that guide our behavior toward other people.

# Privacy

= A major ethical issue

= The right to be left alone when you want to be, to have control over your own personal possessions and not to be observed without your consent.

• Issues affected by technology advances :

1.  Intellectual property

         - Intangible creative work that is embodied in physical form.

  2.   Copyright

         - The legal protection afforded an expression of an idea, such as a song, video game and some types of proprietary documents

   3. Fair use doctrine

        - In certain situations, it is legal to use copyrighted material.

   4.  Pirated software 

     - The unauthorized use, duplication, distribution or sale of copyrighted software.

  

   5. Counterfeit software

        - Software that is manufactured to look like the real thing and sold as such.

•  One of the fundamental and essential in trust is privacy
• Primary reasons privacy issues lost trust for e-business :

    

 

# Security

•  Organizational information is intellectual capital and it must be protected from any harm.

~ Information security

 = The protection of information from accidental or intentional misuse by persons inside or outside an organization.

• E-business automatically creates tremendous information security risks for organizations.

OUTSOURCING IN THE 21ST CENTURY ORGANIZATION

In sourcing

> In sourcing (in-house-development)

= A common approach using the professional expertise within an organization to develop and maintain the organization's information technology systems

Outsourcing

•  An arrangement by which one organization provides a service or services for another organization that chooses not to perform them in-house

# Different forms of outsourcing options a project must consider:

> Onshore outsourcing

= Engaging another company within the same country for services.

> Near shore outsourcing

= Contracting an outsourcing arrangement with a company in a nearby country. Often this country will share a border within  the native country

> Offshore Outsourcing

= Using organizations from developing countries to write code and develop systems. In offshore outsourcing the country is geographically far away

# Reasons company outsource

# Benefits from outsourcing:

~ Financial savings

*  Example: Ford, Chrysler & GM shared CAD/ CAM, e-mail msg & shipping comm- reduce cost of producing cars

~ Increased technical abilities

  - Consequences

• More expense to upgrade system
• More time to install
• Increase complexity to master

~ Market agility

    - Ability to expend core buss more rapidly depending on outsources capabilities to provide:

• Efficient transition to new system
• Better info. Mgt for decision making
• Expansion to new geographical market

# Factors driving outsourcing growth:

~ Core competencies

• Maintain update technology while freeing it to focus on core buss

~ Rapid growth

• Market condition always change. Outsourcing enable organization to acquire best practices process expertise.

~ Industry changes

• M&A force company to change their organization thus outsourcing can make it better for organization to focus on the core competencies

~ The Internet

• Make outsourcing easier with the communication accessibility.

Developing Strategic Outsourcing Partnerships

> Business process outsourcing (BPO)

= contracting of a specific business task, such as payroll, to a third-party service provider

# Categories of BPO

• Back-office outsourcing includes internal buss function.

      * Example: Billing and purchasing

• Front-office outsourcing includes customer-related services

    * Example: marketing and technical support

Sourcing's New Surge - Off shoring

> Offshore outsourcing

= Using organizations from developing countries to write code and develop systems

• According to Forrester Research, nearly half of all businesses use offshore providers, and two-thirds plan to send work overseas in the near future.

COLLABORATIVE PARTNERSHIP

Teams, Partnerships and Alliances

• Use this element to:

        ~ undertake new initiatives
        ~ address both minor and major problems
        ~ capitalize on significant opportunities

> Collaborating system

= Supports the work of teams by facilitating the sharing and flow of information

• Organization form alliances and partnerships with other organizations based on their core competency

> Core competency

=An organization's key strength, a business function that does better than any of its competitors.

> Core competency strategy

= Organization chooses to focus specifically on its core competency and forms partnerships with other organizations to handle nonstrategic business processes.

> Information Partnership

= Occurs when two or more organizations cooperate by integrating their IT systems, thereby providing customers with the best of what each can offer.

Collaboration System

• Collaboration solves specific business tasks such as telecommuting, online meetings, deploying applications and management

> Collaboration system

= An IT-based set of tools that supports the work of teams by facilitating the sharing and flow of information

# Categories of collaboration

> Unstructured collaboration ( information collaboration)

= Includes document exchange, shared white boards, discussion forums and e-mail

> Structured collaboration (process collaboration)

= Involves shared participation in business processes such as workflow in which knowledge is harcoded as rules.

# Collaborative business functions

# Collaboration systems

> Knowledge management systems

• Supports the capturing and use of an organization's "know-how"

~ Knowledge management (KM)

= Involves capturing, classifying, evaluating, retrieving and sharing information assets in a way that provides context for effective decisions and actions.

> Content management systems

•  Provides tools to manage the creation, storage, editing and publication of information in a collaborative environment.

> Workflow management system

• Controls the movement of work through a business process.

> Group ware systems

• Software that supports team interaction and dynamics including calendaring, scheduling and videoconferencing.

Explicit and Tacit Knowledge

•  Intellectual and knowledge-based assets categories:

> Explicit knowledge

= Consists of anything that can be documented, archived and codified often with the help of IT

* Payroll information, customer address, student grades and faculty course taught.

> Tacit knowledge

= Knowledge contained in people's heads

* How to perform a process, how to perform an activity and how you feel about something.

# Best practices for transferring or recreating tacit knowledge

> Shadowing

= Less experiences staff observe more experienced staff to learn how their more experienced counterparts approach their work.

> Joint problem solving

=  A novice and expert work together on a project.

# Reasons why organizations launch knowledge management programs

 KM Technologies

• Knowledge management systems:

       ~ Knowledge repositories (databases)

       ~ Expertise tools

       ~ E-learning applications

       ~ Discussion and chat technologies

       ~ Search and data mining tools

KM and Social Networking

• Finding out how information flows through an organization

> Social networking analysis (SNA)

= A process of mapping a group's contacts (whether personal or professional) to identify who knows whom and who work with whom

- SNA provides a clear picture how employees and divisions work together and can help identify key experts.

Content management

> Content management system (CMS)

= Provides tools to manage the creation, storage, editing and publication of information in collaborative environment.

# CMS marketplace includes:

  

> Document management system (DMS)

= supports the electronic capturing, storage, distribution, archival and accessing of documents.

  > Digital asset management system (DAM)

= Similar to DMS, generally works with binary rather than text files, such as multimedia files types.

> Web content management system (WCM)

= Adds an additional layer to document and digital asset management that enables publishing content both to intranets and public Web sites.

• Content management system vendor overview

Working Wikis

> Wikis

= Web-based tools that make it easy for users to add, remove and change online content

> Business wikis

= Collaborative Web pages that allow users to edit documents, share ideas or monitor the status of a project.

Workflow Management Systems

•  Work activities can be performed in series or in parallel that involves people and automated computer systems.

> Workflow

= Defines all the steps or business rules from beginning to end, required for a business process

> Workflow management system 

= Facilitates the automation and management of business processes and controls the movement of work through the business process.

> Messaging-based workflow system

= Sends work assignments through an e-mail system

> Database-based workflow system

= Stores documents in a central location and automatically asks the team members to access the document when it is their turn to edit the document.

Groupware Systems

• Groupware technologies

# Groupware system advantages

Videoconferencing

•  A set of interactive telecommunication technologies that allow two or more locations to interact via two-way video and audio transmissions simultaneously

Web conferencing

•  Blends audio, video and document-sharing technologies to create virtual meeting rooms where people "gather" at a password-protected Web site.

Instant messaging

• Type of communications service that enables someone to create a kind of private chat room with another individual to communicate in real-time over the Internet.

# Instant messaging application

E - BUSINESS

E-Business

• The differences between e-commerce and e-business

         > E-commerce

     = The buying and selling of goods and services over the internet.

       > E-business

     = The conducting of business on the Internet including, not only buying and selling nut also serving customers and collaborate with business partners.

• Industries using E-business

E-Business Models

•  An approach to conducting electronic business on the Internet

# Business-to-Business

> Electronic marketplace (e-marketplace)

= interactive business communities providing a central market where multiple buyers and sellers can engage in e-business activities.

# Business-to-consumer (B2C)

•  Common B2C e-business models include:

      > e-shop 

    = A version of a retail store where customers can shop at any hour of the day without leaving their home or office

     > e-mail

  = Consists of a number of e-shop, it serves as a gateway through which a visitor can access other e-shops.

• Business types;

     > Brick-and-mortar business

     = Operates in a physical store without an Internet presence.

       > Pure-play business

     = A business that operates on the Internet only without a physical store
       * Example: Amazon.com and Expedia.com

       > Click-and-mortar business

     = A business that operates in a physical store and on the Internet.
       * Example: Barnes and Noble.

# Consumer-to-Business (C2B)

• Example of a C2B e-business model is Priceline.com
• The demand for C2B e-business will increase over the next few years due to customer's desire for greater convenience and lower prices.

# Consumer-to-Consumer (C2C)

• Online auctions

     > Electronic auction (e-auction)
   
   = Sellers and buyers solicit consecutive bids from each other and prices are determined dynamically.
 

    > Forward auction

   = Sellers use as a selling channel to many buyers and the highest bid wins.

    > Reverse auction

   = Buyers use to purchase a product or service, selecting the seller with the lowest bid.

•  C2C communities

    > Communities of interest

   = People interact with each other on specific topics, such as golfing and stamp collecting.

     > Communities of relation

   = People come together to share certain life experiences, such as cancer patients, senior citizens and car enthusiasts.

    > Communities of fantasy

   = People participate in imaginary environments, such as fantasy football teams and playing one-on-one with Michael Jordan.

E-Business Benefits and Challenges

• E-business benefits:

    > Highly accessible

    = Businesses can operate 24 hours a day, 7 days a week, 365 days a year.

      > Increased customer loyalty

    = Additional channels to contact, respond to and access customers helps contribute to customer loyalty

    > Improved information content

   = In  the past, customers had to order catalogs or travel to a physical facility before they could compare price and products attributes. Electronic catalogs and Web pages present customers with updated information in real-time about goods, services and prices.

      > Increased convenience

    = E-business automates and improves many of the activities that make up a buying experience.

    > Increased global reach

    = Businesses, both small and large can reach new markets.

      > Decreased cost

  = The cost of conducting business on the Internet is substantially smaller than traditional forms of business communication

• E-business challenges:

      ~ Protecting consumers
      ~ Leveraging existing systems
      ~ Increasing liability
      ~ Providing security
      ~ Adhering to taxation rules

• Advantages and limitations in e-business revenue model:

        ~ Transaction fees
        ~ License fees
        ~ Subscription fees
        ~ Value-added fees
        ~ Advertising fees

Mashups

# Web mashup

= A Web site or Web application that uses content from more than one source to create a completely new service.

 > Application programming interface (API)

 = A set of routines protocols and tools for building software applications

 > Mashup editor

 = WSYIWYGs (What You See Is What You Get) for mashups.

ENTERPRISE RESOURCE PLANNING

Enterprise Resource Planning (ERP)

• Main component of an ERP systems is a database. Which when a users enters or updates information in one module, it is immediately and automatically updated throughout the entire system.

 

• ERP systems automate business processes

Bringing the Organization Together

• The organization before ERP

• The organization after ERP

The Evolution of ERP

Integrating SCM, CRM and ERP

• These three component are the backbone of e-business.
• integrating these three element is the key to success for many companies
• integration allows the unlocking of information to make it available to any user, anywhere and anytime.

• SCM and CRM market overwiews

• General audience and purpose of SCM, CRM and ERP

Integration tools

•  Middle ware - several different types of software which sit in the middle of and provide connectivity between two or more software applications.
•  Enterprise application integration (EAI) - packages together commonly used functionality which reduces the time necessary to develop solutions that integrate applications from multiple vendors

•  Data points where SCM, CRM and ERP integrate

Enterprise Resource Planning (ERP)

• ERP systems must integrate various organization processes and be:

         > Flexible

       

      = must be able to quickly respond to the changing needs of the organization.

        > Modular and Open

     =  must have an open system architecture, meaning that any module can be interface, with or detached whenever required without affecting the other modules.

       > Comprehensive 

    = must be able to support a variety of organizational functions for a wide range of businesses,

      > Beyond the company

    = must support external partnerships and collaboration efforts

CUTOMER RELATIONSHIP MANAGEMENT

Customer Relationship Management (CRM)

• CRM enables an organization to:

            * Provide better customer service

            * Make call centers more efficient

            * Cross sell products more effectively

            * Help sales staff close deals faster

            * Simplify marketing and sales processes

            * Discover new customers

            * Increase customer revenues.

Recency, Frequency and Monetary Value

• Organizations can find their most valuable customers through "RFM"-

           * Recency - How recently a customer purchased items

            * Frequency - How frequency a customer purchased items

             * Monetary value - How much a customer spends on each purchase.

The Evolution of CRM

> CRM reporting technology

= Help organizations identify their customers across other applications.

> CRM analysis technologies

= Help organization segment their customers into categories such as best and worst customers.

> CRM predicting technologies

= Help organizations make predictions regarding customer behavior such as which customers are at risk of leaving.

• Three phases in the evolution of CRM include reporting, analyzing, and predicting.

The Ugly Side of CRM

Customer Relationship Management's Explosive Growth

•  CRM Business Drivers

Using Analytical CRM to Enhance Decisions

> Operational CRM

= Supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers.

> Analytical CRM 

= Supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers.

• The primary difference between the two is the direct interaction between the organization and its customer.
• Operational CRM and analytical CRM

Customer Relationship Management Success Factors

• CRM success factors include:

           * Clearly communicate the CRM strategy

           * Define information needs and flows

           * Build an integrated view of the customer

           * Implement in iterations

           * Scalability for organizational growth.