Let's Check it ouuuuut!

Monday, August 19, 2013

Chapter 9


Reasons for the growth of decision making information systems
-people need to analyze large amounts of information
-people must take decision quickly
-people must apply sophisticated analysis techniques, such as modeling and foresting, to make good decisions
-people must protect the corporate asset of organizational information

A simplified representation or abstraction of reality



-Moving up through the organizational pyramid users move from requiring transactional information to analytical information
-Transaction processing system – the basic business system that serves the operational level (analysts) in an organization
-Online transaction processing (OLTP) – the capturing of transaction and event information using technology to (1) process the information according to defined business rules, (2) store the information, (3) update existing information to reflect the new information
-Online analytical processing (OLAP) – the manipulation of information to create business intelligence in support of strategic decision making


-Decision support systems (DSS) – models information to support managers and business professionals during the decision-making process
-Three quantitative models used by DSSs include :
1. Sensitively analysis – the study of the impact that changes in one (or               more) parts of the model have on other parts of the model
2. What-if analysis – checks the impact of a change in an assumption on the proposed solution
3. Goal-seeking analysis – finds the inputs necessary to achieve a goal such as a desired level of output

-Executive information system (EIS) – a specialized DSS that supports senior level executives within the organization
-most EISs offering the following capabilities :
1.consolodation – involves the aggregation of intelligent system that mimics the evolutionary, survival-of-the-fittest process to generate increasingly better solutions to a problem
2.drill-down – enables, users to get details and details of details, of information
3.slice-and-dice – looks at information from different perspectives

-INTELLIGENT SYSTEM – various commercial applications of artificial intelligence
-ARTIFICIAL INTELLIGENCE (AI) – Simulates human intelligence such as the ability to reason and learn
-advantages: can check info on competitor
-the ultimate goal of AI is the ability to build a system that can mimic human intelligence
-Four most common categories of AI include :
1. expert system – computerized advisory programs that imitate the reasoning processes of expert in solving difficult problems
2. neural network – attempts to emulate the way the human brain works
-fuzzy logic – a mathematical method of handling imprecise or      subjective information
3. genetic algorithm – an AI system that mimics the evolutionary, survival-if-the-fittest process to generate increasingly better solutions to a problem
4. intelligent agent – special-purposed-knowledge-based information system that accomplishes specific tasks on behalf of its users

-data-mining software includes many forms of AI such as neural networks and expert system
-common forms of data-mining analysis capabilities include:
1. cluster analysis
2. association detection
3. statistical analysis

-CLUSTER ANALYSIS – To divide an information set into mutually exclusive groups such that the members of each group are as possible to one another and the different groups are as far apart as possible
-CRM systems depend on cluster analysis to segment customer information and identify behavioral traits

-Association detection reveals the degree to which variables are related and the nature and frequency of these relationships in the information
-Market basket analysis such items as Web sites and checkout scanner information to detect customers’ buying behavior and predict future behavior by identifying affinities among customers’ choices of products and services

STATISTICAL ANALYSIS performs such functions as information   correlations, distributions, calculations and variance analysis
- forecast – predictions made on the basis of time-series information
- time-series information – time-stamped information collected at a particular frequency

Monday, July 8, 2013

Chapter 4 - Measuring the success of competitive initiative.

·         Key performance indicator – measures that are tied to business drivers
·         Metrics are detailed measures that feed KPIs
·         Performance metrics fall into the nebulous area of business intelligence that is neither technology, nor business centered, but requires input from both IT and business professionals

·         Efficiency IT metric – measure the performance of the IT system itself including throughout speed and availability
·         Effectiveness IT metric – measures the impact IT has on business processes  and activities including customers satisfaction conversion rates and self-through increases

·         Regardless or what is measured, how it is measured and whether it is for the sake of efficiency or effectiveness, there must be benchmarks – beseline values the system seek to attain
·         Benchmarking – a process of continuously measuring system results, comparing those results to optimal system performance and identifying to improve system performance
·         Efficiency IT metrics focus on technology and include :
ü  Throughput - the amount of information that can travel trough a system at any point
ü  Transaction speed - the amount of time a system takes to perform a transaction
ü  System availability – the number of hours a system is available for users
ü  Information accuracy – the extent to which a system generates the correct results when executing the same transaction numerous times
ü  Web traffic – includes a host of benchmarks such as the number of page views, the number of unique visitors, and the average time spent viewing a Web page
ü  Response time –the time it takes to respond to user interactions such as a mouse click

·         Effectiveness IT metrics focus on an organization’s goals, strategies, and objectives and include:
ü  Usability – The ease with which people perform transactions and/or find information. A popular usability metric on the Internet is degrees of freedom, which measures the numbers of clicks required to find desired information.
ü  Customer satisfaction – Measured by such benchmarks as satisfaction surveys, percentage of existing customers retained, and increases in revenue dollars per customer.
ü  Conversion rates – The number of customers an organization “touches” for the first time and persuades to purchase its products or services. This is a popular metric for evaluating the effectiveness of banner, pop-up, and pop-under ads on the Internet.
ü  Financial – Such as return on investment (the earning power of an organization’s assets), cost-benefit analysis (the comparison of projected revenues  and costs including development, maintenance, fixed, and variable), and break-even analysis (the point at which constant revenues equal ongoing costs).

·         Security is an issue for any organization offering products or services over the Internet.
·         It is inefficient for an organization to implement Internet security, since it slows down processing
v  However, to be effective it must implement Internet security
v  Secure Internet connections must offer encryption and Secure Sockets Layers (SSL denoted by the lock symbol in the lower corner of a browser) .

·         Web Site Metrics:
ü  Abandoned registrations – Number of visitors who start the process of completing a registration page and then abandon the activity.
ü  Abandoned shopping carts – Number of visitors who create a shopping cart and start shopping and then abandon the activity before paying for the merchandise.
ü  Click-through – people who visit a site, click on an ad, and are taken to the site of the advertiser.
ü  Conversion rate – potential customers who visit a site and actually buy something.
ü  Cost-per-thousand (CPM) – sales dollar generated per dollar of advertising. This is commonly used to make the case for spending money to appear on a search engine.
ü  Page exposures – average number of page exposure to an individual visitor.
ü  Total hits – number of visits to a web site, many of which may be by the same visitor.
ü  Unique visitor – number of unique visitors to a site in a given time. This is commonly used by Nielsen/Net ratings to rank the most popular Web site.

ü  Back order – an unfilled customer order.
ü  Customer order promised cycle time – the anticipated or agreed upon cycle time of a purchase order.
ü  Customer order actual cycle time – to actually fill a customer’s purchase order.
ü  Inventory replenishment cycle time – measure of the manufacturing cycle time plus  the time included to deploy the product to the appropriate distribution center.
ü  Inventory turns ( inventory turnover ) – the number of times that a company’s inventory cycles or turns over per year.

  • Customer relationship management metrics measure user satisfaction and interaction and include :
-          Sales metrics
-          Service metrics
-          Marketing metrics

  • The balanced scorecard enables organizations to measures and manage strategic initiatives

Sunday, June 30, 2013

Strategic Initiatives Implementing Competitive Advantage

Strategic Initiatives :-
Organization can undertake high profile strategic initiatives including :

Supply chain management (SCM) involves the management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability.

Supply chain management have 4 basic components :

  1. Supply chain strategy - strategy for managing all resource to meet customer demand.
  2. Supply chain partner - partners throughout the supply chain that deliver finished products, raw materials, and services.
  3. Supply chain operations- schedule for production activities.
  4. Supply chain logistics - product delivery process.

Friday, June 28, 2013

Identifying Competitive Advantage

What is Competitive advantage ?

  • A product or service that an organization's customers place a greater value on than similar offerings from a competitor.
  • Unfortunately, CA istemporary because competitiors keep duplicate the strategy.
  • Then, the company should start the new competitive advantage.
Five Forces Model by Michael Porter - useful tools to aid   organizations in challenging decision whether to join a new industry or industry segment. 

  1. Buyer power
  2. Supplier power-Supplier power is the converse of buyer power.  
  3. Threat of Substitute products & Services
  4. Threats of new entrants
  5. Rivalry among existence competitors. 

The Three Generic Strategies -

  • Cost leadership - becoming a low cost producer in the industry allows the company to lower prices to customers. Competitors with higher cost cannot afford to compete with low cost leader on price.
  • Differentiation - Create competitive advantage by distinguish their products on one or more features important to their customers. Unique features or benefits may justify price differences and/or stimulate demand. Ex: i-care by Proton
  • Focused Strategy - Target to a niche market, concentrates on either cost leadership or differentiation.

Business driven technology.

Information technology is everywhere in business.

Information technology's impact on business operations.
  • Business function receiving the greatest benefits from information technology.

Information Technology's Role in Business :-

  • Information technology is everywhere in business.

Information Technology's Impact on Business Operations :-

  1. Organization typically operate by finctional areas or functional silos.
  2. Functional areas are interdependent.


Information Technology Basics :-

  1. Information technology (IT) is a field concerned with the use of technology in managing and processing information.
  2. Information technology is an important enabler of business successand inovation.
  3. When beginning to learn about information technology it is important to understand - a)Data, information, and business intelligent b)IT resource
  4. Management information system (MIS) - a general name for the business function and academic discipline covering the pplication of people, technologies and procedures to solve business cultures.
  5. MIS is a business function similar to Accounting, finance, operations and human resource.

  • DATA -raw facts that discribe the characteristics of an event.
  • INFORMATION -data converted into a meaningful and useful context
  • BUSINESS INTELLIGANCE -applications and technologies that are used to support decision - making efforts.
IT Cultures :-
Organizational information culture include :-
  1. Information functional culture - employees use information as a means of exercising influenceor power over others. For example, a manager in sales refuse to share information with marketing. This causes marketing to need sales manager's input each time a new sales strategy is developed.
  2. Information Inquiring Culture - Employees across departments search for information to better understand the future and align themselves with current trends and new directions.
  3. Information Discovery Culture - Employees across departments are open to new insight about crisis and radical changes and seek ways to create competitive advantages.
  4. Information Sharing Culture - Employees across departments trust each other to use informations (especially about problems and failures) to improve performance.