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Strategic Use of Information Systems in Organizations



This examines how organizations can use information systems (IS) strategically, enabling them to gain or sustain competitive advantage over their rivals. As described “Managing in the Digital World,” a firm has competitive advantage over rival firms when it can do something better, faster, more economically, or uniquely. In this chapter, we begin by examining the role of information systems at different levels of the organization. We then examine international business strategies that shape how information systems can be designed to support how data and controls flow across national borders. Finally, we talk about the continual need to find innovative ways to succeed with and through information systems.

It comes as no surprise that the Internet has not only helped advance traditional business models, but also enabled entirely new kinds of business models. The Web is more flexible than real-life society in many ways, changing how we communicate with friends and family, changing how we work, and clearly changing the way we shop for products and services. This flexibility is a catalyst for the creation of a seemingly endless array of new types of businesses or the reinvention of tried-and-true business models of the past.

After reading this chapter, you will be able to answer the following:
1. How have information systems enabled new, interesting business models like that of Groupon?
2. What are the key components of Groupon’s current business model?
3. How might Groupon leverage technology to strategically create a competitive advantage?

Information Systems for Automating: Doing Things Faster
Someone with an automating perspective thinks of technology as a way to help complete a task within an organization faster, more cheaply, and perhaps with greater accuracy and/or consistency. Let us look at a typical example. A person with an automating mentality would take a loan application screening process and automate it by inputting the loan applications into a computer database so that those involved in decision making for the loans could process the applications faster, more easily, and with fewer errors. Such a system might also enable customers to complete the loan application online. A transition from a manual to an automated loan application process might enable the organization.

1. How do you feel about cell phone use during a flight? Would you switch to or abandon carriers if cell phone use were allowed on one but not the other? Why or why not?

2. Do you think that using the Internet or cell phones creates any security problems on a flight? Why or why not?

Describe the business mission and goals of Nike.

Describe how information systems create competitive advantages for Nike. Analyze and identify the types and functions of systems used in the organization.

What different types of data make up “big data” for Nike?

Describe the big data (what it is and how it is used). Big is a term that describes extremely large data sets that may be analyzed computationally to reveal patterns, trends, and associations. Examples of big data may include data in a company’s customer service department used to solve customer problems or a company’s use of stock market or competitive intelligence data to predict the future (Hint: You can find examples of big data used by the organization by reviewing data reports on the “Investors” or “Our Investors” tab of the organization’s website). Justify your answers.

Use at least one citation from the course textbook. o Reference: Valacich, J. A., & Schneider, C. (2016). Information systems today: Managing in the digital world (7th ed.). Upper Saddle River, NJ: Pearson Prentice Hall

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