Jason Garry OIM 210 Exam 1 Study Guide 1 Chapter 1 Company founders a Zappos Tony Hsieh b Youtube Steve Chen Chad Hurley c Amazon Jeff Bezos d Microsoft Bill Gates Paul Allen e Google Sergey Brin Larry Page f Yahoo Jerry Yang David Filo 2 Slides Design Thinking in Business a Design Thinking The essential ability to combine empathy creativity and rationality to meet user needs and drive business success b User Experience How your product works in the real world or how a person feels about using your product c Design Design can CHANGE business it s more than pretty pictures talks benefits not features and doesn t make users think d What makes great design Simplicity Ex Google homepage e Elements of User Experience from start to finish abstract to concrete i Strategy Where it all begins what does the user want ii Scope transforms strategy into requirements what features will the site need iii Structure gives shape to scope how the pieces fit together and iv Skeleton Makes structure concrete basic v Surface brings everything together visually the finished behave product f Brand How customers feel about you g Customer empathy map 3 Chapter 2 Slides Strategy and Technology a IS Strategy Triangle i Business Strategy drives all other strategies Top of Triangle ii Organizational and Information Strategy are then dependent upon the Business Strategy IS Strategy is affected by the other strategies a firm uses IS Strategy always has consequences iii iv b Organizational Strategy Types i Overall low cost leadership strategy Wal Mart 1 Offer best prices in the industry ii Focused low cost strategy Southwest Airlines 1 Offer best prices in the industry iii Broad differentiation strategy Saks Fifth Ave 1 Offer better products services than competitors iv Focused differentiation strategy Apple 1 Offer better products services than competitors v Best cost provider strategy Target 1 Provide products of reasonably good quality at c Competitive Advantage competitive prices i Porters Five Forces Model Framework used to analyze competition within an industry 1 Level of Industry Competitiveness a Rivalry among existing firms b Threat of new entrants c Bargaining power of buyers d Threat of substitute products services e Bargaining power of suppliers ii Value Chain The set of activities through which a product or service is created and delivered to customers 1 5 Primary Components a Inbound logistics getting needed materials and other inputs into the firm from suppliers b Operations turning inputs into products or services c Outbound logistics delivering products or services to consumers distribution centers retailers or other partners d Marketing and Sales customer engagement pricing promotion and transaction e Support service maintenance and customer support 2 4 Supporting Components a Firm Infrastructure functions that support the whole firm including general management planning IS and finance b HR Management recruiting hiring training and development c Technology Research and Development new product and process design d Procurement sourcing and purchasing functions 4 Rules of Innovation d Be able to give examples of different strategies i Imitation Resistant value chain a way of doing business that others will struggle to replicate a Disruptive innovation Brings a difference value proposition to the market Initially under performs established mainstream markets i Examples Ipad leads the tablet industry 1 Pandora free music b Sustaining Innovation Improves the performance of established products for mainstream customers in major markets Examples c Precursors to Innovation d Test for Disruptive Ideas i A core business that is in control ii A game plan targeted innovation portfolio iii Resource allocation iv Disrupt competitors not customers i Test 1 New Market Disruption 1 Is there a large enough population ii Test 2 Low End Disruption 1 Good enough performance iii Test 3 Sustaining Innovation 1 Disruptive to all the incumbents 5 Chapter 3 Slides Netflix a Know about the company i Streams movies and TV shows directly to the people ii At one point they were a DVD in the mail company b What they do c Long Tail i Mailed DVD s to customers i Monetize the 97 of searches that are odd 1 Amazon has a HUGE inventory while Wal Mart only has what s in stock 2 Same with Netflix vs Blockbuster ii Blockbuster offered 3 000 DVD s Netflix has 125 000 titles d Business Model i Personalization e Churn service f Marginal Cost Fixed Costs i Churn Rate The rate at which customers leave a product or i Marginal Costs License Fees ii Fixed Costs Cost of running programs on the servers of other companies such as Amazon iii Costs about 300 million to run g Disintermediation i Disintermediation in the video industry offers two potentially big benefits 1 Studios don t need to share revenue with third parties They can keep all the money generated through new windows 2 Also if a studio goes directly to consumers then studios get to collect and keep a potentially valuable data asset a If another firm sits between a supplier and its customers the supplier loses out on a key resource for competitive advantage 6 Chapter 4 Slides Moore s Law a What is Moore Law Why is it important in business i Faster Cheaper computing ii 1970 s by Dr Gordon Moore Intel iii Hypothesized that processing performance would double every 18 months 1 Reduction of size Microns iv Businesses are becoming cheaper to run thanks to less hardware and more software b What is IS infrastructure i ii Interconnection of basic facilities and services Information System Infrastructure 1 Hardware 2 Software 3 Comm Collaboration Networks 4 Facilities 5 Data Knowledge 6 Human Resources c Software as a Service i Enables businesses to run software with little or no hardware ii Moves the brains of the software to the server farms iii Might create latency iv Allows newest most updated versions for everyone to use v Available resources allocated based on user needs d Supercomputers i The worlds fastest computers ii Watson iii Jaguar 2nd best e On Demand Computing Utility Computing i Rented from external provider f Grid Computing 1 Outsmarts doctors can find the best possible cure i Software that combines computing power of a large number of smaller independent networked computers 1 Tasks broken down to smaller chunks 2 Berkeley Open Infrastructure ii Ex Bit coin Mining g E waste i Fastest growing waste in the world ii Discarded and often obsolete technology 7 Chapter 5 Slides