Using MIS 3e Part 1Study QuestionsWhy Is the Global Economy Important Today?Slide 4How Does the Global Economy Change the Competitive Environment?Slide 6How Does the Global Economy Change Competitive Strategy?Slide 8How Does the Global Economy Change Value Chains and Business Processes?Slide 10How Does the Global Economy Change Information Systems?Active ReviewCase 1: Getty Images Serves up Profit and YouTube GrowsGetty Images Uses Three Licensing ModelsWhy Did Hellman & Friedman Purchase Getty Images?YouTubeWhat’s the Point of These Examples?Business Model AdvantagesSlide 19The Global EconomyDavid KroenkeUsing MIS 3e Part 11-1Using MIS 3e Part 1: The International Dimension06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-2Q1 Why is the global economy important today?Q2 How does the global economy change the competitive environment?Q3 How does the global economy change competitive strategy?Q4 How does the global economy change value chains and business processes?Q5 How does the global economy change information systems?Study Questions06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-3•Businesses compete in a global market.•Rise of Japanese auto industry and the semiconductor industry•Economies of North America and Europe closely integrated•Fall of Soviet Union opened economies of Russia and Eastern Europe•Telecommunications boom during dot-com boomCheap telecommunications enabled people worldwide to participate in global economy.•300 million people added to world economy in last 15 years!Why Is the Global EconomyImportant Today?06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-4Q1 Why is the global economy important today?Q2 How does the global economy change the competitive environment?Q3 How does the global economy change competitive strategy?Q4 How does the global economy change value chains and business processes?Q5 How does the global economy change information systems?Study Questions06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-5•Internet-equipped world economy has altered every one of the five competitive forces. •Suppliers have to reach a wider range of customers, and customers have to consider a wider range of vendors.•Internet customers can easily learn of substitutions. •Internet made it easier for new market entrants.•Global economy intensified rivalry by increasing product and vendor choices and by accelerating the flow of information about price, product, availability, and service.How Does the Global Economy Change the Competitive Environment?06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-6Q1 Why is the global economy important today?Q2 How does the global economy change the competitive environment?Q3 How does the global economy change competitive strategy?Q4 How does the global economy change value chains and business processes?Q5 How does the global economy change information systems?Study Questions06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-7Global competitive strategies require considering two changing factors:1.Strategy to compete industry-wide means competing in many different countries, with products localized to language and culture of those countries, is an enormous and expensive task.2.Size of global market, combined with Internet, enables unprecedented product differentiation.How Does the Global Economy Change Competitive Strategy?06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-8Q1 Why is the global economy important today?Q2 How does the global economy change the competitive environment?Q3 How does the global economy change competitive strategy?Q4 How does the global economy change value chains and business processes?Q5 How does the global economy change information systems?Study Questions06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-9•Products, subassemblies, parts, and other items are produced at factories worldwide and delivered to customers worldwide.•Global sales change marketing, sales, and service activities.•Value chain activities and processes span the globe and need to address differences in language, culture, and economic environments.How Does the Global Economy Change Value Chains and Business Processes?06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-10Q1 Why is the global economy important today?Q2 How does the global economy change the competitive environment?Q3 How does the global economy change competitive strategy?Q4 How does the global economy change value chains and business processes?Q5 How does the global economy change information systems?Study Questions06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-11•Computer hardware is sold worldwide, and most vendors provide documentation in major languages, so internationalization has little impact on hardware.•User interfaces for an international information system software highly impactedCan an information system use a localized programming language?•What language to use for recording data and remarks? How to translate all that into other languages? •Information systems procedures need to reflect local cultural values and norms.How Does the Global Economy Change Information Systems?06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-12Q1 Why is the global economy important today?Q2 How does the global economy change the competitive environment?Q3 How does the global economy change competitive strategy?Q4 How does the global economy change value chains and business processes?Q5 How does the global economy change information systems?Active Review06:52Copyright © 2011 Pearson Education, Inc. Publishing as Prentice HallID1-13•Founded in 1995 with the goal of consolidating fragmented photography market by acquiring many small companies, applying business discipline to merged entity, and developing modern information systems. •Advent of the Web drove the company to e-commerce and in process enabled Getty to change the workflow and business practices of professional visual-content industry. •Getty Images grew from a startup to a $600 million plus, publicly traded, very profitable company by 2004.•By 2007, Getty had increased its revenue to more than $880 million. •2008, Getty purchased