Chapter 3: IS, Organizations and Strategy Flashcards
impact of IS on organizations, competitive strategies
1
Q
What are some characteristics of modern organizations?
A
- hierarchical, specialized & impartial, using routines to aximize efficiency
- certain culture & politics
- affected by srrounding environment
- differ in goal, groups served, social roles, leadership styles, incentives, tasks & structure
- certain authority & accountability in system of impartial DM (unparteiisch)
2
Q
How are organizations ad their IS connected?
A
- reciprocal relationship with mediating factors: environment, culture, structure, BPs, politics, management decisions
3
Q
Key facts about IS & organizations
A
- new IS will always affect business objectives (day-to-day behaviour, org structure)
- IS designed to serve the needs of important org groups
- IS are shaped by the organization & its characteristics
- Is can reduce transaction & agency costs
- Schumpeter’s Creative Destruction leading to resistance
4
Q
Technical microeconommic definition of organizations
A
- capital & labour are transformed by firm into products & services
- products & services are consumed by environment, which provides additional labor & capital (loop)
5
Q
Transaction cost theory
A
- firms seek to economize on transaction costs (costs of participating in markets) through vertical integration (taking ownership of supply stages), hiring more employees, buying sellers & distributors)
- IT tech lowers transaction costs, making it worthwhile to transact with other firms instead of hiring more employees
6
Q
Agency theory
A
- a firm is a nexus of contracts among self-interested parties requiring supervision, which is why firms experience agency costs (costs of managing & supervising) that rise with growth of firm
- IT tech reduces agency costs by digitalizing control processes, making increased hiring unnecessary
7
Q
What are the main three org. and behavioural impacts of IS on organizations?
A
- flattened organizations (DM in lower levels, fewer managers needed)
- in postindustrial organizations, authority relies on knowledge & competence (flattened)
- Biodal IT is the practice of managing two separate but coherent styles of work (pedictability & exploration) and serves to narrow the gap between IT supply & business needs by establishing separate modes for business-oriented & traditional IT delivery (other option: service-oriented & API-based instead of reliable vs agile)
8
Q
What are the 5 competitive forces a firm faces in a market (Porter’s Competitive Forces model)?
A
- competition with its traditional direct competitors
- new market entrants
- substitute products & services
- suppliers
- customers
9
Q
Strategiesto counter competitive forces
A
- maintaining low costs
- differentiating products/ services
- focusing on market niches
- strengthening ties with customers & suppliers
- increasing barriers to market entry with high levels of operational excellence
10
Q
According to the value chain model (Porter), what are firms)
A
- a series of primary (directly related to production & distribution) & support/ auxiliary (enable delivery of primary activities) activities that add to a firm’s products or services
- highlighting specific activities in the business where competitive strategies & IS will have the greatest impact
11
Q
What are value webs?
A
- An extension of the value chain, use of standards & industry-wide consortia (firms joining for some time for business purposes) by effective collaboration
- collection of independent firms using highly synchronized IT
- more customer-driven
12
Q
What is the exact role of IS in value webs?
A
- tying together operations of disparate BUs
- promoting cross-functional knowledge sharing across BUs
- network economics: facilitate business models based on large networks of users/ subscribers
13
Q
What does a virtual company strategy imply?
A
Using networks to link to other firms, thereby using those extra capabilities
14
Q
What are business ecosystems?
A
- multiple companies or industries that work together to deliver value to the customer, mediated by IS (example: different streaming services)
15
Q
Define synergies
A
- Using outputs of some units as input for others
- Organizations pooling markets & expertise (Google & YouTube)
