Week 10

Question 1

What is IT standardization?

Answer 1

The activity of establishing and recording a limited set of IT solutions to actual or potential matching problems (application, data, hardware, network, security, platform)

Question 2

What is business process standardization? What are the advantages and disadvantages?

Answer 2

The extent to which business units will perform the same processes the same way (McDonald’s hamburger preparation)

Adv:

• Creates efficiency and predictability across BU
• Allows the activities of different BUs to be measured, compared and improved

Disadv:

• Limits oppurtunities to customize products/services
• Limits local innovation
• Requires perfectly good local processes be replace with standard ones

Question 3

What is business process integration?

Answer 3

The extent to which BU share data

• Share data between related, but separated processes (loyalty points, customer preferences)
• Enable end-to-end processing (enhance customer experience)
• Enable a single face to customers
• Requires standard data (common definition and format of data)

Question 4

What are the four levels of business process integration based on the two dimensions

• Business process integration (high/low)
• Business process standardization (high/low)

Answer 4

Low/low: Diversification (BU pursue different markets with different products/services, benefit from local autonomy)
High/low: Coordination (focus on integration, create a single face to customers)
Low/high: Replication (focus on standardization, BU perform tasks the same way)
High/high: Unification (Company persues the need for reliability, predictability and low cost by standardizing, data sharing and single face to customers)

Question 5

How can IT help with innovation?

Answer 5

IT-enabled potential absorptive capacity (knowledge acquisition and assimilation capabilities) –> IT-enabled realized absorptive capacity (knowledge transformation and exploitation capabilities) –> Ideated innovation (knowledge that is created through firms’ innovation efforts, inventions, discoveries, solutions, patents) –> IT-enabled social integration capacity (development of social capital through direct human interactions and discourse) –> commercialized innovation (market-available ideas, number of new products/services introduced to the market in a three-year period)