AB1401: Information Technology

Seminar 1: Introduction The Digital World

2012-2013 Semester 1
NTU, NBS

Introduction to the Course

How IT Applies To Business Today

Business Changes Due To IT Developments

The Internet, Globalization & A Flat World

We begin by asking some questions:

What
Who
What
So

is a business?

make up a business?
is important in business?

how does IT help?

(keep in mind the converse question: how does IT destroy?)

Sales & Marketing Manufacturing &

Production

Finance &
Accounting

Human
Resources &
Training

Selling products &

services. Promoting
brand awareness

Managing financial
assets, records,
cashflow & overall
prudence & growth.

Recruiting &
developing work force,
productivity &
competitiveness

Producing products &

services. Operations
efficiency.

Using information systems effectively requires an understanding of the

organization, management, and information technology shaping the
systems. An information system creates value for the firm as an
organizational and management solution to challenges posed by the
environment.
4

McAfee, A (2006) Harvard Business Review

11

12

What industries has Google transformed?

How long has it taken this IT company to

achieve its top branding?
The company went IPO in 2004!

What is Googles market value?

$163 Billion (2012 Aug)

Which other company has

dominated its industry as much
as Microsoft?

Market Value
$245 Billion (2012 Aug)

New ventures from MS

Bing, Windows Mobile, Windows,

What industries has Apple transformed?

Computers, Animation, Music, and now Mobile
Phones!

Market Value in 2001 (before the iPod was

introduced) $6 Billion
Market Value today
$568 Billion (2012 Aug)

= $$$

17

The Role of Information Systems in Business Today

Information Technology Capital Investment

Information technology investment, defined as hardware, software, and communications

equipment, grew from 32% to 51% between 1980 and 2008.
Source: Based on data in U.S. Department of Commerce, Bureau of Economic Analysis, National Income
and Product Accounts, 2008.

Figure 1-1

Growing interdependence between ability to

use information technology and ability to
implement corporate strategies and achieve
corporate goals
Business firms invest heavily in information
systems to achieve six strategic business
objectives:

Operational excellence
New products, services, and business models
Customer and supplier intimacy
Improved decision making
Competitive advantage
Survival

NBA Teams Make a Slam

Dunk with Information
Technology

Problem: Lack of hard data usable in decision-making

processes, costly and competitive market.
Solutions: Developed a new system designed to collect
and organize data using video clips of games.
Synergy Sports Technology tags video of each game
with hundreds of descriptive categories and allows
coaches and players to stream game footage from the
Web.
Demonstrates ITs role in innovation and improving
business processes.
Illustrates how the Web has allowed businesses to use
new tools to analyze critical data.

22

In the emerging, fully digital firm

Significant business relationships are
digitally enabled and mediated
Core business processes are accomplished
through digital networks
Key corporate assets are managed digitally
Digital firms offer greater flexibility in
organization and management
Time shifting, space shifting

Globalization 1.0 1492~1800

Globalization 2.0 1800~2000

Engine of growth was the company

MNCs expand to overseas markets

Globalization 3.0 2000~to-date

Engine of growth was the country

A period of ground discovery literally

Thomas Friedman:
The World Is Flat

Engine of growth was the individual

People are enabled by technologies to
globalize

Thesis: In Globalization 3.0, the world gets

flattened.

http://www.youtube.c
om/watch?v=UcK3b9
qlBfk

11-9: Berlin wall downed, MS Windows 3.0 up

8-9-1995: Netscape IPO, dot-com boom begins

10 days of
Flattening

triggering $1 trillion investment in fiber optics

6 Platforms for Collaboration In A Flattened World
Outsourcing: move payroll function to India (eg)
Off-shoring: move entire factory to China (etc)
Uploading: beyond downloading, open-source Linux,
blogging, pod-casting
Supply-chaining: Walmart largest company which
makes nothing
In-sourcing: UPS takes over your logistics
Informing I can inform myself
Steroid Wireless tech, VOIP, file sharing,
Moores law, all boosting flattening

All the 10 days of flattening converge in 2000

Convergence 1: The Internet provides a new

platform to converge the trends.

Convergence 2: Habits are changed to converge to

the new platform (eg print your own boarding pass)

Convergence 3: 3 billion people (India, China,

Russia) join the platform.