Lecture 10: value generation through services Flashcards
What is the impact of IT investments on firm performance
IT investments impact on firm perfomance depends on what goal for IT is set - and whether they emphasise operational effectivesness or strategic positioning
What was Nicolas Carr main points
IT is highly replicable and can be imitated rapidly by competitors, hampering IT- based competitive advantage
(1) Spend less
(2) Follow, don’t lead
(3) Focus on vulnerabilities, not opportunities
Explain the productivity paradox and how it can be explained/resolved (reasons)
The “Productivity Paradox” implies that despite … growing use of IT,
growing investments in IT,
and exponentially growing computing power
… there is not “automatically” or always … increased productivity,
increased competitiveness,
and added value for customers.
management failure, measurement errors, IT is embedded
IT and mindfullness
??
How to resolves the paradox
–> Need for managerial IT skills: know-how about organizational processes are crucial to exploit the benefits of superior IT systems
➢ Select the adequate aggregation level: business process level instead of industry/firm level
➢ Take business process performance measures (e.g. cycle time, costs)
➢ Control for moderating factors (e.g. competitiveness of the environment)
Balanced Scorecard, Benchmarking (compare business processes with best practise), Enterprise risk management, Six Sigma (tool to measure predictability), CRM (measure customer relationship) etc.
Define IT business value and how does it differ from IT-based competitive advantage
IT business value is defined as organizational performance impacts of information technology at both the process level and the organization-wide level, and comprising both efficiency impacts and competitive impacts.
IT-based value is not the same as IT-based competitive advantage: differentiate between creating operational value (e.g., efficiency) and strategic value (e.g., IT-based capabilities for competitive advantage)
EX. ERP system (sales, supply, procurement ect.) vs. machine learning
Explain the IT business value model and give an example of how it can be used to evaluate business value of IT
micro og macro level
What is co-creation - give an example of it:
Customer co-creation (B2C) refers to inviting stakeholders (usually customers) to participate in a design or problem-solving process to produce a mutually valued outcome.
overcome delivery chain problems, or even technical solutions to complex manufacturing questions.
IKEA: co-creating with costumers though a digital platform to develop a new product
Asking customers for product idea suggestions
Running IKEA Bootcamps to work with entrepreneurs
Collaborating with university students on product solutions
Connecting with innovation labs around the world
B2B: KIBS - R&D, IT outsourcing, and consultancy management
Explain the four themes
theme 1: IT-Based Co- Creation of Value, Theme 2:business value of IT theme 3: information mindset theme 4: value expansion
how can enterprise value be generated through IT?
(kolli) it creates value under certain conditions and must be combined with non-it factors
it can impact the operational value - process efficiency , financial value ex. ROI and strategic value, strategical level: IT based capabilities for competetive advantage
