Chapter 3,4 and 5

CHAPTER  3

Strategic Iniciatives For Implementing Competitive  Advantage

Strategic Iniciatives

Supply Chain Management(SCM)

Involve the management of information flow between and among stages in supply chain to maximize total supply chain effectiveness and probability.

Four(4) basic of SCM:

1.      Supply Chain Strategy

-Strategy for managing all resource to meet customer demand.

2.      Supply Chain Partner

-Partner throughout the supply chain that deliver finished product,raw meterials and services.

3.      Supply Chain Operation

-Schedule for production activities.

4.      Supply Chain Logistic

-Product delivery process.

Effective and efficient SCM systems can enable an organization to:

1.     Decrease the power of its buyers.

2.     Increase its own supplier power.

3.     Increase switching costs to reduce the threat of substitute products or services.

4.     Create entry barriers thereby reducing the threat of new entrants.

5.     Increase effectiveness while seeking a competitive advantage through cost leadership.

Customer Relationship Management(CRM)

Involve managing all aspects of a customers relationship with an organization to increase customer loyalty and retention and an organizations profitibality.

CRM can enable organizations to:

1.      Identify types of customer.

2.      Design individual customer marketing campaign.

3.      Treat each customer as an individual.

4.      Understand customer buying behaviors.

Business Process Reengineering(BPR)

The analysis and redisgn of workflow within and between enterprise.

Opportunity using BPR.

1.Acompany can improve the way ittravels the road by moving from foot to  horse and from horse to car.

2.BPR looks at taking a different part,such as an airplane which ignore the road complety.

Enterprise Resource Planning(ERP)

Intergrates all departments and functions throughout an organizations into a single IT systems so that employees can make decision by viewing enterprisewide information on all business operations.

CHAPTER 4

Measuring the success of strategic iniciatives.

Key performance indicator

-measures that are tied of to business drivers.

Efficiency IT metrics

-Measures the perfomance of the IT systems itself including troughput ,speed, and availability.

Effectiveness IT metrics

-Measures the impact iT has on business processes and activities including customer satisfaction,conversion rates and sell-through increase.

Benchmarking

-A process of continuously measuring system results,comparing those results of optimal systems performance (benchmarks values),and identifying steps and procedures top improve system performance.

Efficiency IT metrics focus on:

1.      Throughput

-the amount of information that can travel through a system at any point.

2.      Transaction speed

-the amount of time a system takes to perform a transaction.

3.      System availability

-the number of hours a systemis available for users.

4.      Information accuracy

-the extend to which a system generates the correct results when executing the same transaction numerous times.

5.      Web traffic

-includes a host of benchmarks such as the number of page views,the number of unique visitors,and the average time spent viewing a web page.

6.      Response time

-the time it takes to respond to user interactions such as mouse click.

   Effectiveness IT metrics focus on:

1.      Usability

-The ease with each people perform transactions and find information.

2.      Customer satisfaction

-Measured by such benchmarks such as satisfaction survey,percentage of existing customers retained and increase in revenue dollars per customer.

3.      Conversion rates

The numbers of customer an organization “touches” for the first time and persuade to purchase its product or services.

4.      Financial

-Such as return on investment ,cost benefit analysis,and break-even analysis.

Chapter 5

Organizational Structures that Support Strategic Initiatives

Organizational Structures

-          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 businesses upon

IT roles and responsibilities

Chief Information Officer

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

-          Manager, leader, communicator

Chief Technology Officer – responsible to ensuring the throughput, speed, accuracy, availability,   and reliability of IT

Chief Security Officer – responsible for ensuring the security of IT systems

Chief Privacy Officer – responsible for ensuring the ethical and legal use of information

Chief Knowledge Officer – responsible for collecting, maintaining and distributing the organization's knowledge

Gap between Business Personnel and IT Personnel

1.       Each personnel only expertise in their own areas so this causes a communications gap.

2.       Ways to improve communication :

-          Each personnel must seek to increase their understanding of other areas

-          CIO must ensure effective communication between all departments

Ethics

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

-          Privacy is a major ethical issue.

-          Other issues are intellectual property, copyright, fair use doctrine, pirated software and

Security

-          Organizational information is intellectual capital, it must be protected.

-          Information security – the protection of information from misuse by persons

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