Chapter Six valuing organizational information

Chapter Six : valuing organizational information

 Organizational Information

Information is everywhere in an organization. when addressing a significant business issue, employees must be able to obtain and analyze all the relevant information so they can make the best decision possible. Organizational Information comes at different levels and in different formats and granularities. Information granularity refers to the extent of detail within the information (fine and detailed or coarse and abstract). Employees must be able to correlate the different levels, formats, and granularities of information when making decisions.

ORGANIZATIONAL INFORMATION

•   information granularity refers to extent of detail within information ( fine and detailed or coarse and abstract)

 

 

The Value of Transactional and Analytical Information

•  Transactional information encompasses all of the information contained within a single business process or unit of work , and its primary purpose is to support the performing of daily operational tasks
•  Analytical information encompasses all organizational information, and its primary purpose is to support the performing of managerial analysis tasks

THE VALUE OF TIMELY INFORMATION 

•  REAL- TIME INFORMATION means immediate , up-to-date information.
•  REAL- TIME SYSTEMS provide real-time information in response to query request.

THE VALUE OF QUALITY INFORMATION

Business decisions are only as good as the quality of the information used to make the decisions.

The five characteristics of high-quality include:

1) Accuracy

2) Completeness

3) Consistency

4) Uniqueness

5) Timeliness

Five common characteristics of high- quality information

                                  
  

UNDERSTANDING THE COSTS OF POOR INFORMATION

 

 
          

 

• Using the wrong information can lead to making the wrong decision.
• Making the wrong decision can cost time, money and even reputations.
• Bad information can cause serious business ramifications such as :

1) Inability to accurately track customers , which directly affects strategies initiatives such as CRM and SCM

2)difficulty identifying the organization's most valuable customers.

3)Inability to identify selling opportunities and wasted revenue from marketing to none existing customers and non deliverable mail

4) Difficulty tracking revenue because of inaccurate voices

5) Inability to build strong relationship with customers- which increases buyer power

UNDERSTANDING THE BENEFITS OF GOOD INFORMATION

 

 

 

 

 

Chapter four : Measuring the Success of Strategic Initiatives

                                      Chapter 4 : Measuring the Success of Strategic Initiatives

MEASURING INFORMATION TECHNOLOGY’S SUCCESS

• -          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 AND EFFECTIVENESS

• -          Efficiency IT metric – measures the performance of the IT system itself including throughput, speed, and availability
• -          Effectiveness IT metric – measures the impact IT has on business processes and activities including customer satisfaction, conversion rates, and sell-through increases

BENCHMARKING – BASELINE METRICS

• -          Regardless of what is measured, how it is measured, and whether it is for the sake of efficiency or effectiveness, there must be benchmarks –baseline values the system seeks to attain
• -          Benchmarking – a process of continuously measuring system results, comparing those results to optimal system performance (benchmark values), and identifying steps and producers to improve system performance

-          Comparing efficiency IT and effectiveness IT metrics for the government initiatives 

THE INTERRELATIONSHIPS OF EFFICIENCY AND EFFECTIVESS IT METRICS

-          Common types of efficiency IT metrics

	Efficiency IT Metrics
Throughput	The amount of information that can travel through a system at any point.
Transaction speed	The amount of time a system takes to perform a transaction.
System availability	The number of hours at system is available for users.
Information accuracy	The extent to which a system generates the correct results when executing the same transaction numerous times.
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.
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…

	Effectiveness IT Metrics
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 number of clicks required to find desired information.
Customers satisfaction	Measured by such benchmarks as satisfaction surveys, percentage of existing customers retained, and increases in revenue dollars per customer.
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.
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 content 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.

·         However, to be effective it must implement Internet security.

·         Secure Internet connections must offer encryption and Secure Sockets Layers (SSL denoted by the lock symbol in the lower right corner of browser)

-          Interrelationships between efficiency and effectiveness. 

METRICS FOR STRATEGIC INITIATIVES

-          Metrics for measuring and managing strategic initiatives include;

·         Website metrics.

·         Supply chain management (SCM) metrics

·         Customer relationship management (CRM) metrics

·         Business process reengineering (BPR) metrics

·         Enterprise resource planning (ERP) metrics 

WEBSITE METRICS

SUPPLY CHAIN MANAGEMENT METRICS 

CUSTOMER RELATIONSHIP MANAGEMENT METRICS

BPR and ERP Metrics

-          The balanced scorecard enables organizations to measure and manage strategic initiatives. 

Chapter Three Strategic Initiatives for Implementing Competitive Advantages

                                       
                              Strategic Initiatives for Implementing Competitive Advantage

                                                     

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 Strategy: A plan to manage all the resources need it by customers to supply their own products and services.

Supply Chain Partners: The associates to the business, picked by the company to deliver their finish products and other tasks such as pricing, delivering, selling, and paying partnership.

Supply Chain Operation: The way and time of production activities are conducted, from the packing to the testing, from productivity and quality of such.

Supply Chain Logistics: The way the product is being deliver, the cars and carriers, invoicing the product and returns.

Wal-Mart and Procter & Gamble (P&G) SCM

Effective and efficient supply chain management systems can enable an organization to:

 ■ Decrease the power of its buyers.

 ■ Increase its own supplier power.

 ■ Increase switching costs to reduce the threat of substitute products or services.

 ■ Create entry barriers thereby reducing the threat of new entrants.

 ■ Increase efficiencies while seeking a competitive advantage through cost leadership 

Effective and efficient SCM systems effect on Porter’s Five Forces

Customer relationship management (CRM) – involves managing all aspects of a customer’s relationship with an organization to increase customer loyalty and retention and an organization's profitability

- Many organizations, such as Charles Schwab and Kaiser Permanente, have obtained great success through the implementation of CRM systems

- CRM is not just technology, but a strategy, process, and business goal that an organization must embrace on an enterprisewide level

CRM can enable an organization to:

-Identify types of customers

- Design individual customer marketing campaigns 

-Treat each customer as an individual

-Understand customer buying behaviors

Business process reengineering (BPR) – the analysis and redesign of workflow within and between enterprises

- The purpose of BPR is to make all business processes best-in-class

• The purpose of BPR is to make all business processes best-in-class

• Finding opportunity using BPR

• Types of change an organization can achieve, along with the magnitudes of change and the potential business benefit

   Enterprise Resource Planning - integrates all departments and functions throughout an organization into a single IT system so that employees can make decisions by viewing enterprisewide information on all business operations

• ERP systems collect data from across an organization and correlates the data generating an enterprisewide view