Module

Instructors Manual

IT and Business Advantage

> US$ 2 trillion spent on IT worldwide in 2007

Continued rapid

spending growth Truly global spending distribution

Ever increasing dependence on and impact of IT

Search

for opportunity Avoidance of operational risk

Module 1 discusses how to leverage IT to create business advantage.

Applegate, L.M., Austin, R.D., and Soule, D.L., Corporate Information Strategy and Management, 8th edition, Burr Ridge, IL: McGraw-Hill/Irwin, 2009

Module 1: IT and Business Advantage Overview of Chapters

Chapter 1

Introduces the organizing framework for the module Defines a business model Explores evaluation of business models Examines the impact of IT on business models Examines the impact of IT on organizational capabilities Examines the impact of IT on business value

Chapters 2

Chapter 3

Chapter 4

Applegate, L.M., Austin, R.D., and Soule, D.L., Corporate Information Strategy and Management, 8th edition, Burr Ridge, IL: McGraw-Hill/Irwin, 2009

Module 1: IT and Business Advantage The Five Competitive Forces that Shape Strategy

Michael Porters classical theory of strategy formulation

Original HBR article in 1979 Simple, powerful description of five forces Five forces analysis in practice Five forces distinguished from contemporary factors (e.g. the internet)

What can we learn from this article?

How economic value is created and claimed by participants in a business network or industry How IT might change the relative strength of each force

Applegate, L.M., Austin, R.D., and Soule, D.L., Corporate Information Strategy and Management, 8th edition, Burr Ridge, IL: McGraw-Hill/Irwin, 2009

Module 1: IT and Business Advantage Amazon.com: The Brink of Bankruptcy

Traces evolution of Amazon.com from founding in 1994 to 2001 The case ends with the company poised at the brink of bankruptcy What can we learn from this case?

Apply business model thinking Demonstrate how IT can be used as a key driver of business value through its impact on strategy and organizational capabilities Identify how to identify IT-enabled proprietary assets that can serve as a platform to exploit disruptive change

Applegate, L.M., Austin, R.D., and Soule, D.L., Corporate Information Strategy and Management, 8th edition, Burr Ridge, IL: McGraw-Hill/Irwin, 2009

Module 1: IT and Business Advantage Canyon Ranch

Founded in 1979 Leader in health resort and spa industry

Facing increasing competitive pressure

Goal: leverage customer information to increase customer loyalty and cross-selling opportunities

Role of IT in building CRM capabilities How to use information assets to drive business value How IT can shape strategy and capabilities

What can we learn from this case?

Applegate, L.M., Austin, R.D., and Soule, D.L., Corporate Information Strategy and Management, 8th edition, Burr Ridge, IL: McGraw-Hill/Irwin, 2009

Module 1: IT and Business Advantage Boeings e-Enabled Advantage

Until late 1990s, largest commercial airplane company Airline industry faces multiple challenges

Customers face increased cost pressure Fragmented suppliers Boeing drops to #2 behind government-subsidized rival, Airbus

Strategic goal: use IT to regain market dominance

More information-driven product and service offerings Improved IT-enabled efficiency

What can we learn from this case?

How to use IT to differentiate a product and create new revenue streams by selling packaging and selling information and by creating new service offerings

Applegate, L.M., Austin, R.D., and Soule, D.L., Corporate Information Strategy and Management, 8th edition, Burr Ridge, IL: McGraw-Hill/Irwin, 2009

Module 1: IT and Business Advantage

Royal DSM N.V.: IT enabling Business Transformation

Diversified Netherlands-based company

Coal mining, industrial chemicals, life science products, etc.

Strategic shift from highly cyclical businesses to high growth businesses

Rapid divestitures and acquisitions

Use IT to enable rapid growth and acquisition integration

Standardization of IT infrastructure and applications IT function shifts from support to strategic

What can we learn from this case?

How to leverage IT in support of organizational flexibility and agility How to use IT to build an organizational platform for business transformation
Applegate, L.M., Austin, R.D., and Soule, D.L., Corporate Information Strategy and Management, 8th edition, Burr Ridge, IL: McGraw-Hill/Irwin, 2009