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Week 2: Globalization and Information Systems

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Week 2: Globalization and Information Systems MIS 2101: Management Information Systems Based on material from Information Systems Today: Managing in the Digital World ... – PowerPoint PPT presentation

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Title: Week 2: Globalization and Information Systems


1
Week 2 Globalization and Information Systems
MIS 2101 Management Information Systems
Based on material from Information Systems Today
Managing in the Digital World, Leonard Jessup
and Joseph Valacich, Pearson Prentice Hall, 2007
Also includes material from The World Is Flat
A Brief History of the Twenty-first Century,
Thomas L. Friedman, Farrar, Straus and Giroux,
2007 Also includes material by David Schuff,
Paul Weinberg, and Cindy Joy Marselis.
2
The integration of systems and business processes
is now a global issue and opportunity
The idea of charging for calls belongs to the
last century. Niklas Zennström, Skype
2-2
3
Learning Objectives
4
Learning Objectives
5
Globalization
  • Globalization created a new world characterized
    by
  • Worldwide communication
  • Collaboration without barriers

6
Tom Friedman
  • Tom Friedman . . . Pulitzer Prize-winning New
    York Times foreign affairs columnist and author
    of the renowned book on globalization, The World
    is Flat
  • Toms book discusses the factors that have
    contributed to the increasing connectedness or
    flattening of the world
  • Information Technology is playing a key role

7
Tom Friedmans The World is Flat Video
  • As you watch the video, take notes and be ready
    to discuss
  • What was the Overall Point of the video (and the
    book)?
  • What are the 10 Flatteners --- What are their
    implications according to Friedman?
  • Based on the video, what does someone need to do
    to be successful in the 21st Century
  • You can also view the video on the Internet at
    http//mitworld.mit.edu/stream/264/

8
Evolution of Globalization
Globalization 1.0
  • Mainly European countries are globalizing
  • Power is the primary driver
  • Industries changed
  • Slow pace of change

9
Evolution of Globalization
Globalization 2.0
  • Companies are globalizing
  • Reduction in transportation and
    telecom-munications costs
  • Mainly Europe and America involved

10
Evolution of Globalization
Globalization 3.0
  • Individuals and small groups are globalizing
  • Fast changes
  • Emergence of new industries

11
The overall idea
  • The global economic playing field has been
    leveled
  • Competition is worldwide
  • Few jobs or markets are constrained by geographic
    boundaries
  • There are steps you can take to succeed in this
    world

12
Flattener 1 11/9/1989 The Fall of the Berlin
Wall Windows 3.1 released
  • The Wall was a physical and symbolic barrier to a
    flat economy
  • Windows removed a barrier to the creation of
    digital content
  • Started a major change from large centralized
    systems to small decentralized systems on a mass
    scale.

13
Flattener 2 Netscape went public
  • Triggered
  • New services
  • Dot com boom
  • Overbuild of fibre optics
  • Boston, Bethesda, and Bangalore are now
    neighbors.
  • Companies no longer control collaborative
    development of technology products

14
Flattener 3 Hardware and software
interoperability
  • Easier for applications to work with other
    applications (with some exceptions)
  • Smokestacks like AOL and CompuServe replaced or
    redesigned

15
Flattener 4 Outsourcing
  • Outsourcing
  • Moving Jobs
  • Outsourcing companies profited from the drop in
    telecommunications costs
  • Companies can now use talented staff from anywhere

16
Flattener 5 Offshoring
  • Offshoring Moving entire operations

17
Flattener 6 Uploading
  • Open source products developed collaboratively
    and free
  • Wikipedia
  • Open office
  • Creation/distribution of material by anyone
  • Potentially threatening to Microsoft, The New
    York Times, Record Labels, and others

Listed as Open Sourcing in the book
18
Flattener 7 Supply Chaining
  • Integration of retailers, suppliers, and
    customers
  • Increases efficiency. (Why?)

19
Flattener 8 In-Sourcing
  • Delegation of companys key operations to a
    subcontractor
  • What does UPS do in this area?

20
Flattener 9 Informing
  • Individuals have access to massive amounts of
    information
  • What types of information are easily available to
    you now that werent 10 years ago?
  • How has this affected car dealers?

21
Flattener 10 The Steroids
  • Technologies that support different types of
    collaboration
  • Greater mobility
  • Convergence of media and technoloigies

22
Discussion
  • What does someone need to do to be successful in
    the 21st century?

23
Learning Objectives
24
Opportunities of Operating in the Digital World
  • Opportunities of Reaching New Markets
  • Former Eastern Bloc countries provide new
    opportunities for international companies to
    reach new customers

25
Opportunities of Operating in the Digital World
Engineering Graduates in the US, Europe and India
  • Opportunities of a Global Workforce
  • Low communications costs
  • Highly-skilled labor pool

26
Learning Objectives
27
Challenges of Operating in the Digital World
  • Globalization also created a set of unprecedented
    challenges
  • Governmental challenges
  • Geoeconomical challenges
  • Demographic challenges
  • Cultural challenges

28
Governmental Challenges
  • Political System
  • Regulatory
  • Internet Access and Individual Freedom

29
Geoeconomic Challenges
  • Time Zone Challenges
  • Real time meetings across continents difficult
  • But working around the clock possible
  • Infrastructure-Related Challenges
  • Roads, electricity, communications services

30
Demographic Challenges
  • Expertise related challenges
  • Different concentration of skilled workers
  • Different costs of workers

31
Cultural Challenges
  • Risk taking
  • Language
  • Work skills/habits
  • Intellectual property concepts

32
Learning Objectives
33
Going Global International Business Strategy in
the Digital World
  • Multidomestic Business Strategy
  • Global Business Strategy
  • Transnational Business Strategy

34
Multidomestic Business Strategy
  • Low degree of integration between subunits
  • Flexible and responsive to the needs and demands
    of local markets
  • E.g. General Motors
  • Opel in Germany
  • Vauxhall in Great Britain

35
Global Business Strategy
  • Centralized
  • Used to achieve economies of scale
  • E.g. Coca-Cola
  • Same core product
  • Some different tastes made for local markets

36
Transnational Business Strategy
  • Some operations centralized while others
    decentralized
  • Flexibility
  • Economies of scale
  • Difficult to manage
  • E.g. Unilever

37
Information Systems Strategies
  • Multinational Information Systems Strategy
  • Often used by multidomestic companies
  • Decentralized systems
  • Communication between home office and
    subsidiaries
  • No focus on communication between different
    subsidiaries
  • Decentralized local data processing centers

38
Information Systems Strategies
  • Global Information Systems Strategy
  • Used by companies with global business strategy
  • Centralized infrastructure
  • Home office coordinates most of the strategic
    decisions
  • Communication and data sharing networks between
    home office and subsidiaries
  • Data does not stay with local subsidiaries but
    flows back to the home office

39
Information Systems Strategies
  • Transnational Information Systems Strategy
  • Pursued by transnational businesses
  • Extensive communication between home office and
    subsidiaries as well as among subsidiaries
  • Key data shared throughout the company

40
Cases
41
Niklas Zennström Cofounder and Chief Executive
Officer, Skype
  • The idea of charging for calls belongs to the
    last century.
  • Skype has 28 million subscribers
  • Among the 100 most influential people
    transforming the world

2-41
42
Transnational Development
  • Wrigley Company
  • Worlds largest manufacturer of chewing gum
  • Sold in 150 countries
  • Good information systems key to conducting
    marketing research
  • Russian marketing research branch initiated the
    development of a marketing research work flow
    automation system
  • After successful testing, system was implemented
    in other marketing research branches

2-42
43
The Automobile Industry
  • The automobile industry is feeling the pressure
    of globalization
  • Failed attempts at making a world car
  • Consumers have different tastes
  • Differences in infrastructures derive needs
  • The price of gasoline
  • Variations in emission standards
  • Cultural and economic conditions need to undergo
    more globalization to make a world car successful

2-43
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