CHAPTER 7 : STORING ORGANIZATIONAL INFORMATION - DATABASE

RELATIONAL DATABASE FUNDAMENTALS

- Database - maintains information about various types of objects (inventory), events (transactions), people (employees) and places (warehouses)

Database models include :

1. Hierarchical database model - information is organized into tree-like structure (using parent/child relationships) in such a way that it cannot have too many relationships.

     2. Network database model - a flexible way of representing objects and their relationships.

     3. Relational database model - stores information in the form of logically related                                    two- dimensional tables. 

Entities and Attributes

Entity - a person, place, thing, transaction or event about which information is stored.

Attributes (fields, columns) - characteristics or properties of an entity class.

Keys and Relationships

Primary key - a field (or group of fields) that uniquely identities a given entity in a table.

Foreign key - a primary key of one table that appears an attribute in another table and acts to provide a logical relationship among the two tables.

RELATIONAL DATABASE ADVANTAGES

1) Increased Flexibility

- Database provide flexibility in allowing each user to access the information in whatever way best suits his or her needs.

- The distinction between logical and physical views is important in understanding flexible database user views.

-The physical views of information deals with the physical storage of information on a storage device such as a hard disk.

- The logical views of information focuses on how users logically access information to meet their particular business. 

  2) Increased Scalability and Performance

- Only a database could 'scale' to handle the massive volumes of information and the large numbers of users required for the successful launch of the Ellis Island website.

- Scalability refers to how well a system can adapt to increased demand.

- Performance measures how quickly a system performs a certain process or transaction.

3) Reduced Information Redundancy

 - Redundancy is the duplication of information, or storing the same information in multiple places.

- Redundant information occurs because organizations frequently capture and store the same information in multiple locations.

- The primary problem with redundant information is that it is often inconsistent which make it difficult to determine which values are the most current or most accurate.

4) Increased Information Integrity (Quality)

- Information integrity is a measures the quality of information

- Within a database environment, integrity constraints are rules that help ensure the quality of information. It can be defined and built into the database design.

- Two types of integrity constraints are :

• Relational integrity constraints- rules that enforce basic and fundamental information-based constraints
• Business-critical integrity constraints- enforce business rules vital to an organization's success and often require more insight and knowledge than relational integrity constraints.

5) Increased Information Security

- Information is an organizational asset.

- Database offer many security features such as

        * Passwords - provide authentication of the user

        * Access levels - determines who has access to the different types of information

        * Access control - determines types of user access such as customer service representatives                                               might read-only access

- Database can increase personal security as well as information security

DATABASE MANAGEMENT SYSTEMS

A database management systems (DBMS) is software through which users and application programs interact with a database.

 

DATA-DRIVEN WEB SITES

- A data-driven website is an interactive website keep constantly updated and relevant to the needs of its costumer through the use of a database.

Data-Driven Website Advantages :-

• Development : Allows the website owner to make changes any time
• Content management : A static website requires a programmer to make updates.
• Future expandability : Having a data-driven website enables the site to grow faster than would be possible with a static site.
• Minimizing human error : A well- designed, data-driven Web site will have "error typing" mechanisms to ensure that required information is filled out correctly.
• Cutting production and update costs : A data-driven Web site can be updated and "published" by any competent data entry or administrative person.
• More efficient : The system keeps track of the templates.
• Improved stability : There is peace of mind, knowing the content is never lost-even if your programmer is. 

Integrating Information Among Multiple Database

- An integration allows separate systems to communicate directly with each other.

- A forward integration takes information entered into a given system and sends it automatically to all downstream processes. This type of integration always use by the organization.

- A backward integration - takes information entered into a given systems and sends it automatically to all upstream systems and processes

 

 Building a central repository specifically for integrated information.

 

Without the integration, an organization will :

 - spend considerable time entering the same info in multiple system

 - suffer from the low quality and inconsistency typically embedded in redundant info.

 

CHAPTER 6 : VALUING ORGANIZATIONAL INFORMATION

ORGANIZATIONAL INFORMATION

• Information is everywhere in an organization 
• Employees must be able to obtain and analyze the many different levels, formats and granularities og organizational information to make decisions
• Successfully collecting, compiling, sorting and analyzing information can provide tremendous insight into how an organization is performing

THE VALUE OF TRANSACTIONAL AND ANALYTICAL INFORMATION

- Transactional Information

• it is a routine activities
• a single business process
• support daily organization
• consist of repetitive activity
• it is store in the database

- Analytical Information

• in shape of report
• to support managerial analysis task
• making decision for the organization

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

THE VALUE OF QUALITY INFORMATION

Business decisions are only good as the quality of the information used to make the decisions

• Characteristics of high-quality information include :

• Low quality information example

UNDERSTANDING THE COSTS OF POOR INFORMATION

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

CHAPTER 5 : ORGANIZATIONAL STRUCTURES THAT SUPPORT STRATEGIC INITIATIVES

An organizational structure defines how activities such as task allocation, coordination and supervision are directed toward the achievement of organizational aims. It can also be considered as the viewing glass or perspective through which individuals see their organization and its environment.

IT ROLES AND RESPONSIBILITIES

• Information technology is a relatively new functional area, having only been around formally for around 40 years.

1. Chief Information Officer (CIO)

2. Chief Technology Officer (CTO)

3. Chief Security Officer (CSO)

4. Chief Privacy Officer (CPO)

5. Chief Knowledge Officer (CKO)

THE GAP BETWEEN BUSINESS PERSONNEL AND IT PERSONNEL

IMPROVING COMMUNICATIONS

• 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 of 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
• In recent years, such event as the 9/11 have shed new light on the meaning of ethics and security

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

Privacy is a major ethical issue.

Privacy - 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 

• One of the main ingredients in trust is privacy 
• Primary reasons privacy issues lost trust for e-business.

Security 

Organizational information is intellectual capital that must be protected.

Information Security - the protection of information of information from accidental or intentional misuses by persons inside or outside an organization.

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

CHAPTER 4 : MEASURING THE SUCCESS OF STRATEGIC INITIATIVES

Key Performance Indicator : measures that are tied to business drivers.

- Metrics are detailed measures that feed KPI's.

- Performance metrics fall into the nebulous area of business intelligence that is neither technology, nor business centered, but requires input from both IT and business professionals.

EFFICIENCY AND EFFECTIVENESS 

Efficiency IT metric - measures the performance of the IT system itself including throughput, speed and availability.

Effectiveness IT metric - measures the impact IT has on business processes and activities including customer satisfaction conversion rates, and sell-through increases.

BENCHMARKING - BASELINING METRICS

Benchmarks - baseline values the system seeks to attain.

Benchmarking - a process of continuously measuring system results, comparing those results to optimal system performance ( benchmark values ), and identifying steps and procedures to improve system performance.

THE INTERRELATIONSHIPS OF EFFICIENCY AND EFFECTIVENESS IT METRICS

METRIC FOR STRATEGIC INITIATIVES

-          Metrics for measuring and managing strategic initiatives include;

·         Website metrics.

·         Supply chain management (SCM) metrics

·         Customer relationship management (CRM) metrics

·         Business process reengineering (BPR) metrics

·         Enterprise resource planning (ERP) metrics 

WEBSITE METRICS

SUPPLY CHAIN MANAGEMENT METRICS 

CUSTOMER RELATIONSHIP MANAGEMENT METRICS

BPR and ERP Metrics

-          The balanced scorecard enables organizations to measure and manage strategic initiatives. 

CHAPTER 3 : STRATEGIC INITIATIVES FOR IMPLEMENTING COMPETITIVE ADVANTAGES

Organizations can undertake high-profile strategic initiatives including :

• Supply chain management (SCM)
• Customer relationship management (CRM)
• Business process reengineering (BPR)
• Enterprise resource planning (ERP)

1. SUPPLY CHAIN MANAGEMENT (SCM) - involves the management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability.

• -          It involves the management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability
• -          Four basic components of supply chain management include;

o        Supply chain strategy – strategy for managing all resources to meet customers demand

o       Supply chain partner – partners throughout the supply chain that deliver finished products, raw materials and services

o      Supply chain operation – schedule for production activities

o     Supply chain logistics – product delivery process

• -          Effective and efficient SCM systems can enable an organization to;

o      Decrease the power of its buyers

o      Increase its own supplier power

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

o     Create entry barriers thereby reducing the threat of new entrants

o    Increase efficiency while seeking a competitive advantages through cost leadership

THE EFFECTIVE AND EFFICIENT SCM SYSTEMS EFFECT ON PORTER'S FIVE FORCES

2. CUSTOMER RELATIONSHIP MANAGEMENT (CRM) - involves managing all aspects of a customer's relationship with an organization to increase customer loyalty and retention and an organization's profitability.

• -          CRM is not just technology, but a strategy, process and business goal that an organization must embrace on an enterprise wide level
• -          CRM can enable an organization to;

o      Identify types of customers

o      Design individual customer marketing campaign

o      Treat each customer as a individual

o      Understand customer buying behaviors

 3. BUSINESS PROCESS REENGINEERING (BPR) - the analysis and redesign of workflow within and between enterprises.

- The purpose of BPR is to make all business processes best-in-class.

Business Process - a standardized set of activities that accomplish a specific task, such as processing a customer's order.

4. ENTERPRISE RESOURCE PLANNING (ERP) - integrates all departments and functions throughout an organization into a single IT system so that employees can make decisions by viewing enterprisewide information on all business operations.

- keyword in ERP in 'enterprise'.

ERP systems collect data from across an organization and correlates the data generating an enterprise view.

 

CHAPTER 2 : IDENTIFYING COMPETITIVE ADVANTAGES

To survive and thrive an organization must create a competitive advantage.

THE FIVE FORCES MODEL - EVALUATING BUSINESS SEGMENTS

PORTER'S FIVE FORCES MODEL - determines the relative attractiveness of an industry.

Buyer Power - high when buyers have many choices of whom to buy from and low when their choices are few.

Way to reduce buyer power is through loyalty programs

•  Loyalty program - rewards customers based on the amount of business they do with a particular organization.
• Switching costs - costs that can make customers reluctant to switch to another product or service.

Supplier Power - high when buyers have few choices of whom to buy from and low when their choices are many.

• Supply chain - consists of all parties involved in the procurement of a product or raw material.

Way to reduce supplier power :

Threat of Substitute Products or Services - high when there are many alternatives to a product or service and low when there are few alternatives from which to choose.

• Switching cost - costs that can make customers reluctant to switch to another product or service.
• eg: water companies in every state

Threat of New Entrants - high when it is easy for new competitors to enter a market and low when there are significant entry barriers to entering a market.

• Entry barrier - a product or service feature that customers have come to expect from organizations in a particular industry and must be offered by an entering organization to compete and service.
• eg: fuel, bank

Rivalry Among Existing Competitors - high when competition is fierce in a market and low when competition is more complacent.

• competition is always more intense in some industries than in others, the overall trend is toward increased competition in just about every industry.
• eg: telco company (celcom, maxis, digi, tune talk and umobile)

THE THREE GENERIC STRATEGIES - CREATING A BUSINESS FOCUS

Organizations typically follow one of Porter's three generic strategies when entering a new market.

Broad market and low cost : Walmart competes by offering a broad range of products at low prices. Its business strategy is to be the low-cost provider of goods for the cost-conscious consumer.

Broad market and high cost : Neiman Marcus competes by offering a broad range of differentiated products at high prices. Its business strategy offers a variety of specialty and upscale products to affluent consumers.

Narrow market and low cost : Payless competes by offering a specific product, shoes at low prices. Its business strategy is to be the low-cost provider of shoes. Payless competes with Walmart, which also sells low-cost shoes, by offering a far bigger selection of sizes and styles.

Narrow market and high cost : Tiffany & Co. competes by offering a differentiated product, jewelry, at high prices. Its business strategy allows it to be a high-cost provider of premier designer jewelry to affluent consumers.

VALUE CHAIN

Once an organization chooses its strategy, it can use tools such as the value chain to determine the success or failure of its chosen strategy.

VALUE CREATION

Customers determine the extent to which each activity adds value to the product or service.

The competitive advantage is to :

• Target high value-adding activities to further enhance their value.
• Target low value-adding activities to increase their value.
• Perform some combination of the two

Value chain with Porter's Five Forces

CHAPTER 1 : BUSINESS DRIVEN TECHNOLOGY

INFORMATION TECHNOLOGY'S IMPACT ON BUSINESS OPERATIONS

INFORMATION TECHNOLOGY BASICS

DATA , INFORMATION AND BUSINESS INTELLIGENCE (BI)

INFORMATION TECHNOLOGY RESOURCES

INFORMATION CULTURES