Week 11

Organization
An organization is a group of people that is structured and managed to meet its
mission or set of group goals.

A formal collection of people and other resources is established to accomplish a set

of goals

A system

Constantly uses money, people, materials, machines, and other equipment, data,
information, and decisions

The Value chain

The value chain is a series (chain) of activities that an organization performs to
transform inputs into outputs.

💡 It is like information system’s process level. Turns data into valuable

information.

Week 11 1
 Managing the value chain includes:

1. Supply chain management (SCM)

2. Customer relationship management (CRM)

Supply chain management (SCM) encompasses all the activities required to get the
right product into the right customer’s hands in the right quantity at the right time and
right cost, from the acquisition of raw materials through customer delivery.

Supply chain management (SCM) determines:

What supplies are required for the value chain

What quantities are needed to meet customer demand

How supplies should be processed into finished goods and services

How shipment of supplies and products to customers should be scheduled,

monitored

and controlled

Customer relationship management (CRM) programs:

Help companies manage all aspects of customer encounters

Can get customer feedback to help design new products and services

Examples: Customer Management Systems in Banks

Subscriber Registration application in Mobile operators

Role of information systems

Organizational structure refers to organizational subunits and the way they relate to
the overall organization. An organization’s structure depends on its goals and its
approach to management.

Week 11 2
 Types of organizational structure:

Traditional

Project

Team

Virtual

Traditional hierarchical organizational structure

Traditional hierarchical organizational structure also called a functional structure, is
like a managerial pyramid where the hierarchy of decision-making and authority flows
from the strategic management at the top down to operational management and the
non-management employees. The military is one of the best examples of hierarchical
organizational structure.

The pyramid:

Week 11 3
 1. Decision-making (CIO)

2. Managing, operating (managers)

3. Implementing (nonmanagement employees)

Flat organization structure

empowers employees at lower levels

empowerment gives employees and their managers more responsibility and

authority to make decisions, take action, and have more control over their jobs.

Matrix organizational structure

In a matrix organisational structure, an individual has to reporting superiors (managers)
— one functional and one operational. (Local and global managers).

🚨 Mr.WhoCares will ask this one

Projects organizational structure

Project organizational structure is focused on major products or services, with
program managers responsible for directing one or more projects. Each project is
staffed with a project manager who leads a group of people to accomplish the goals of
the project.

Centered on major products or services

many project teams are temporary

Team organizational structure

Week 11 4
 centered on work teams or groups

team can be temporary or permanent, depending on tasks

Virtual team
A Virtual team is a group of individuals whose members are distributed geographically,
but who collaborate and complete work through the use of information systems
technology.

uses individuals, groups, or complete business units in geographically dispersed

areas

can reduce costs for an organization

Reengineering and Continuous Improvement

To stay competitive, organizations must occasionally make fundamental changes in the
way they do business. In other words, they must innovate and change the activities,
tasks, or processes they use to achieve their goals. Reenginering, also called process
redesign and business process reengineering (BPR), involves the radical redesign of
business processes, organizational structures, information systems, and values of the
organization to achieve a breakthrough in business results.
In contrast to reengineering, the idea of continuous improvement (often referred to by
the Japanese word “Kaizen”) is a form of innovation that constantly seeks ways to
improve business processes and add value to products and services.

🚨 Mr.WhoCares will ask this one. Even the “Kaizen”

Week 11 5
 Organizational Culture
Organizational culture consists of the major understandings and assumptions of an
organization. The understandings which can include, beliefs values, and approaches to
decision-making, are often not stated or documented as goals or formal policies.

Change model
A change model represents change theories by identifying the phases of change and
the best way to implement them. Kurt Lewin and Edgar Schein proposed a three-stage
approach for change.

Unfreezing - preparing for change

Communicate what, why, when, who, how

Week 11 6
 Draw on others, and seek input, ideas

Define objectives, success criteria, resources, schedule, budget

Finalize work plans

Assign leaders and implementation teams

Moving - Making the change

Motivate individuals involved or affected

Coach, train, lead, encourage, manage

Provide appropriate resources

Provide ongoing feedback

Refreezing - institutionalizing
monitor progress against sucess criteria

Establish processes, systems to institutionalize change

Establish controls to ensure change is occuring

Recognize and reward individuals for exhibiting new behavior

Provide feedback, motivation, additional training to individuals not exhibiting new

behavior

Electronic Commerce (e-commerce)

Electronic Commerce (e-commerce) is the conducting of business activities
electronically over computer networks.

Business-to-Busines (B2B)
Business-to-Busines E-commerce is a subset of e-commerce in which all the
participants are organizations. B2B e-commerce is a useful tool for connecting business
partners in a virtual `supply chain to cut resupply times and reduce costs.

Week 11 7
 Business-to-Costumer (B2C)
Business-to-Costumer E-commerce is a form of e-commerce in which customers
deal directly with an organization and avoid intermediaries (vaistəçi).

💡 Brick-and-mortar is a classic marketing with local customers overhead is

high, but the margin is low

E-commerce is a digital marketing with global customers overhead is love,

but the margin is high

Costumer-to-Costumer (C2C)
Costumer-to-costumer e-commerce is a subset of e-commerce that involves
electronic transactions between consumers using third parties to facilitate the process.
eBay is an example of a C2C e-commerce site; customers buy and sell items to each
other through the site.

E-government
E-government is the use of information and communications technology to simplify the
sharing of information, speed up formerly paper-based processes, and improve the
relationship between citizens and government

Goverment-to-citizen (G2C)
Citizens can use G2C applications to submit their state and federal tax returns online
and make campaign contributions. All electronic systems that help us to solve our
government and law problems via the internet can called G2C e-government

Goverment-to-buisness (G2B)
Government-to-business applications support the purchase of materials and services
from the private industry by government procurement offices, enable firms to bid on

Week 11 8
 government contracts, and help businesses identify government contracts on which
they may bid.

Goverment-to-goverment (G2G)
Government-to-government applications support transactions between governments
and between governments’ departments. G2G services online is a suite of web
applications that enables government organizations to report information, such as birth
and death data.

Advantages of Electronic and Mobile Commerce:

Reach new customers

Reduce the cost of doing business

Speed the flow of goods and information

Increase the accuracy of order-processing

Improve the level of customer service

Challenges of E-commerce:

Dealing with consumer privacy concerns (buyers’ problem)

About one-third of all adult Internet users will not buy online due to privacy concerns

Overcoming consumers' lack of trust in online sellers (buyers’)

Overcoming global issues

Cultural, language, time

Multistage model for E-commerce

A successful e-commerce system must address the many stages that consumers
experience in the sales life cycle. At the heart of any e-commerce system is the user’s

Week 11 9
 ability to search for and identify items for sale.

1. Search and Identification

The employee prepares a list of needed items--for example, fasteners, piping, and
plastic tubing. She fills out a request-for-quotation form by entering the item codes and
quantities needed.

2. Select and Negotiate

The employee also specifies the desired delivery date. This data is used as input into
the supplier’s order. processing system. In addition to price, an item's quality and the
supplier's service, and speed of delivery can be important in the selection and
negotiation process.

3. Purchase Products and Services Electronically

4. Deliver Product and Service

5. After-Sales Service

🚨 Mr.WhoCares will ask this one.

Comprehensive customer information is also captured from the order and stored in the
supplier's customer database. This information can include the customer’s name,
address, telephone number, contact person, credit history, and other details. For
example, if the customer later contacts the supplier to complain that not all items were
received, that some arrived damaged, or even that the product provides unclear
instructions. any customer service representative can retrieve the order information from
the database via a computing/communications device.

Week 11 10
 Business strategies:
Operational excellence improves efficiency (a measure of what is provided divided
by what is consumed) and productivity (effectiveness)

New products, services, and business models creating new products and
services. Define business model

Customer and supplier intimacy either increases or reduces clients’ loyalty. With
the economy in recession, customers have more alternatives than ever. E.g.,
Service for loyal customers to make them commit

Improved decision making

Week 11 11
 Competitive advantage

Survival social media management, good websites, customer support with all
possible channels, mobile applications

Five forces model, competitive advantage:

1. Rivalry among competitors

2. The threat of new entrants

3. The threat of substitute products

4. Bargaining power of buyers

5. Bargaining power of suppliers

The most successful e-commerce models include three basic components: community,
content, and commerce.
Content: Blog posts, videos, images–the media that individuals choose to seek out in
their everyday digital lifes.
Community: The social sphere–social media engagement, site communities, and a
conversation between customers and a retailer.

Commerce: Capabilities to seamlessly purchase merchandise engaged with on the

site.

Week 11 12
 Trust ——

Multistage model for e-commerce page 374

Successful model and strategy page 388

Week 11 13