IT-Enabled Business Transformation From Automation to Business Scope Redefinition.
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Transcript of IT-Enabled Business Transformation From Automation to Business Scope Redefinition.
IT-Enabled Business IT-Enabled Business TransformationTransformation
IT-Enabled Business IT-Enabled Business TransformationTransformation
From Automation to Business From Automation to Business Scope RedefinitionScope Redefinition
Agenda
• Introduction• 5 Levels of Transformations• Conclusion• Q & A
Introduction• Team members
商研一• 張菽珊• 謝文淵• 簡見安• 林俊吉
Business Logic Evolution
1970s and 1980s:
exploiting experience curve for achieving low relative cost through vertical integration (efficiency enhancement).
1990s:
low cost, high quality, and fast/flexible response to customers’ need (capabilities enhancement).
Localized Exploitation
Internal Integration
Business Process Redesign
Low
Low
HighRange of potential benefit
Degree of
bu
siness
transform
ation
High
EvolutionaryLevels
Revolutionary Levels
Business Network Redesign
Business Scope Redefinition
Five levels of IT-enabled business transformation
Level 1Localized Exploitation
• Leveraging of IT functionality to design focused, high-value areas of business operations
• Example: – Customer Order Entry System– Toll-free Customer Service System
Level 1Localized Exploitation
• Strength– Easy to identify and exploit potential IT
capability– Minimal organizational resistance to change
• Weakness– Potential duplication of efforts with in the
same organization– Lack of organizational learning
• Management Challenges
– Identification of high-value areas – Benchmark against best practice– Redesign performance assessment
Level 1Localized Exploitation
Level 2Internal Integration
• Leveraging of IT capability to create a seamless process ----both technical interconnectivity & business process interdependence
• Example
-Lexus and Infiniti
Level 2Internal Integration
• Strengths -Supports the total quality movement -Streamlines the organization process to deliver improved customer service
• Weaknesses -limited impact if competitors using newer logic
of organizing
Level 2Internal Integration
• Management Challenge -business process interdependence and
technical interconnectivity -Performance reassessed criteria -Benchmark results against best-in-class
Enablers and Inhibitors
*Technological Enablers *Technological Inhibitors
1. Favorable cost-performance trends 1. Obsolescence of technologies
2. Enhanced connectivity capabilities 2. Lack of established standards
*Organizational Enablers *Organizational Inhibitors
1. Managerial awareness 1. Managerial resistance
2. Leadership 2. Financial constraints
Enablers and Inhibitors of Evolutionary Level of Transformation
Level 3Business Process
Redesign
• Redesign key process for competing in the future
• Use IT capability for future organization capability
• Strengths -First mover advantage -Not be hindered by historical process
• Weakness -Redesigning process might be obsolete or outsourced to partners
Level 3Business Process
Redesign
• Management Challenge– Articulate business rationale for redesign– Recognize organization issues and
challenges
Level 3Business Process
Redesign
Level 4Business Network
Redesign
• Leverage related participants in the business network to provide products and services
• Exploiting IT functionality for learning from extended network
• Strengths– Elimination of activities where the focal
organization may not have required level of competence
– Streamlining business scope to remain flexible
and responsive to fast-changing and diverse customer needs
– Exploit sources of competence in the larger business network
Level 4Business Network
Redesign
• Weaknesses– May not provide the requisite source of
differential advantage if the participants in the business network not well-coordinated
– Lack of a streamlined internal IT infrastructure could hinder the ability to learn from extended business network
Level 4Business Network
Redesign
Level 5Business Scope
Redefinition
• Redefining corporate scope enabled and facilitated by IT functionality
• Example: McGraw-Hill
• Strengths– Opportunity to Create a more flexible and
effective business entity– Substitution as an effective alternative to
vertical integration
• Weaknesses– Not developing a consistent competence for
the future– Possibility of “Hollowing” the corporation
Level 5Business Scope
Redefinition
• Management challenge– Creative mix of internal activities, external
relationship and business arrangement – Assessing business success by measuring
return on value added or return per employee
Level 5Business Scope
Redefinition
Localized Exploitation
Internal Integration
Business Process Redesign
Low
Low
HighRange of potential benefit
Degree of
bu
siness
transform
ation
High
Business Network Redesign
Business Scope Redefinition
Conclusion—Alternative Approaches to BPR
Seek Efficiency
Enhance Capabilities
Any Question ?Any Question ?
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