Corporate Information Management

A.K. Swain

IIM Kozhikode
Automation vs. Digitalization
 Automation vs. Digitalization
Automation
Automate human physical effort.
Digitize physical assets (such as
paper or telephones).
Automate the prescribed
workflow (doing-by- design).
Standardize work activities for
efficiency (bottom line).
Manage single transactions and
simple events.
Persist data for transactional
integrity.
Digitalization
Augment (or displace) human cognition.
Accessorize the physical, and manipulate the
digital assets to enhance decision making and
alter actions using real-time context data and
metadata.
Orchestrate interactions in real time, using
values, policies and goals/outcomes to guide
behavior (design-by-doing).
Use situational adaptation to maximize the
customer's experience of value - the "business
moment" (top line).
Manage aggregated events (a situation, a case,
an instance).
Persist event and context data for situational
integrity.
 Case: Buy Experience, Not things
Retail is one of the most competitive and stingiest industries in America boasting some of
the most dissatisfied workers across the board. Walmart Stores employees began a
week-long strike in Miami, Boston, and the San Francisco Bay Area to publicly display
their immense dissatisfaction with the multinational corporation. Employees at
Amazon.com fulfillment center in Leipzig, Germany went on strike demanding higher
wages and better benefits. Just search retail strikes and you will find numerous examples
of dissatisfied employees doing what they can to improve their situations. However, there
is one company that will not appear on the list – Costco Wholesale!
Costco Wholesale, the second-largest retailer in the U.S. behind Walmart, is an anomaly
in a world where retailers are closing their doors due to the inability to compete with
online prices. Retail stores such as Aeropostale, Sears, and Macy’s are all feeling the
pressure of the online
marketplaces of today’s digital world. Costco requires a $55-a-year membership fee for
access to its massive warehouses supplied floor to ceiling with generous portions of
everything from olive oil to paper towels. While many businesses are losing customers to
the Internet Costco’s sales have grown 40 percent and its stock price has doubled.
Treating employees exceptionally well is the secret to Costco’s success. Costco
employees make an average of $20 an hour, not including overtime and eighty-eight
percent of Costco employees have company-sponsored health insurance. Costco treats
its employees well in the belief that a happier work environment will result in a more
profitable company. It is obvious Costco is thriving in one of the toughest retail markets in
history.
 Case: Buy Experience, Not things
The style of Costco is minimalist with no-frills industrial shelving stocking the 4,000
different products. Products are marked up 14 percent or less over cost. Items like
diapers, suitcases, and tissues, which it sells under its in-house Kirkland Signature
brand, get a maximum 15 percent bump. After accounting for expenses such as
real estate costs and wages, Costco barely ekes out a profit on many of its products.
Eighty percent of its gross profit comes from membership fees; customers renew their
memberships at a rate of close to 90 percent.
“They are buying and selling more olive oil, more cranberry juice, more throw rugs than
just about anybody,” says David Schick, an analyst at Stifel Nicolaus. And that allows
Costco to get bulk discounts from its suppliers, often setting the industry’s lowest price.
Even Amazon can’t beat Costco’s prices, which means that “showrooming,” or browsing
in stores but buying online for the better price, isn’t much of a concern for Costco.
The company’s obsession with selling brand-name merchandise at cut-rate prices
occasionally gets it into trouble. Tiffany filed a multi-million-dollar trademark infringement
suit against Costco alleging it improperly labeled merchandise as “Tiffany engagement
rings.” Costco calls it “an honest mistake” and re-branded the label “Tiffany-style.” The
suit is pending.
 Case: Buy Experience, Not things
Buying Happiness
When you work hard every single day you want to spend your hard-earned funds on
what science says will make you happy. The Commerce Department released data
showing that American consumers are spending their disposable income on eating out,
upgrading cars, renovating houses, sports, health, and beauty. Data shows restaurant
spending has increased 10 percent over the last year, and automotive sales have
increased seven percent. Analysts say a wider shift is occurring in the mind of the
American consumer, spurred by the popularity of a growing body of scientific studies
that appear to show that experiences, not objects, bring the most happiness. The
Internet is bursting with the “Buy Experiences, Not Things” type of stories that give
retailing executives nightmares. Millennials - the 20- and 30-something consumers
whom marketers covet are actively pursuing this new happiness mentality.
A 20-year study conducted by Dr. Thomas Gilovich, a psychology professor at Cornell
University, reached a powerful and straightforward conclusion: don’t spend your money
on things. The trouble with things is that the happiness they provide fades quickly. New
possessions quickly become old and what once seemed novel and exciting quickly
becomes the norm. The bar is constantly rising and new purchases lead to new
expectations. As soon as we get used to a new possession, we look for an even better
one. And of course we are always comparing ourselves to the neighbors. By nature, we
are always comparing our possessions and as soon as we buy a new car a friend buys
a better one—and there’s always someone with a better one.
 Case: Buy Experience, Not things
Buying Happiness
Gilovich is not the only person believing experiences make us happier than
possessions. Dr. Elizabeth Dunn at the University of British Columbia attributes the
temporary happiness achieved by buying things to what she calls “puddles of pleasure.”
In other words, that kind of happiness evaporates quickly and leaves us wanting more.
Things may last longer than experiences, but the memories that linger are what matter
most!
 Case: Buy Experience, Not things
Questions:
1. Imagine you are working for Costco as a manager in its Chicago store.
Your boss does not understand the difference between data, information,
business intelligence, and knowledge. Using examples of products and
services available at Costco, provide examples of each to help your boss
understand these important concepts.
2. Explain why it is important for Costco’s corporate accounting, marketing,
and operations management business units to access and analyze
information about your store’s sales. What could happen if your store sales
were not shared with the different business units at Costco’s headquarters?
3. Explain systems thinking and how MIS solves the issue with information
silos throughout Costco’s entire worldwide organization.
4. Imagine you are working for Costco as a manager in its Chicago store.
Using Porter’s Five Forces Model, analyze buyer power and supplier power
for Costco.
5. Which of the three generic strategies is Costco following?
6. Only members of Costco can purchase products at Costco. Which of
Porter’s Five Forces did Costco address through the introduction of its
members-only program?
 Case: Buy Experience, Not things

1. Imagine you are working for Costco as a manager in its

Chicago store. Your boss does not understand the
difference between data, information, business
intelligence, and knowledge. Using examples of
products and services available at Costco, provide
examples of each to help your boss understand these
important concepts.

IIM Kozhikode 9
 Case: Buy Experience, Not things

Question 2. Explain why it is important for Costco’s corporate

accounting, marketing, and operations management business
units to access and analyze information about your store’s sales.
What could happen if your store sales were not shared with the
different business units at Costco’s headquarters?
Question 3. Explain systems thinking and how MIS solves the
issue with information silos throughout Costco’s entire worldwide
organization.
 Case: Buy Experience, Not things

Question 4. Imagine you are working for Costco as a manager in

its Chicago store. Using Porter’s Five Forces Model, analyze
buyer power and supplier power for Costco.
 Case: Buy Experience, Not things

Question 4. Imagine you are working for Costco as a manager in

its Chicago store. Using Porter’s Five Forces Model, analyze
buyer power and supplier power for Costco.
Question 5. Which of the three generic strategies is Costco
following?
 Case: Buy Experience, Not things

Question 6. Only members of Costco can purchase products at

Costco. Which of Porter’s Five Forces did Costco address through
the introduction of its members-only program?
 Chapter 2:
Opening Case: Robots Took My Job
Opening Case: Robots Took My Job
1. Define the three primary types of decision-making systems
and how robots in the workplace could affect each.
2. Describe the difference between transactional and analytical
information, and determine how robots could affect each for a
grocery store such as Safeway.
3. Illustrate the business process model used by a robot to
perform an analysis on a patient with a cold.
4. Explain business process reengineering and how robots
might dramatically change the current sales process.
5. Formulate different metrics that a personal trainer robot for a
fitness club could provide a customer.
6. Argue for or against the following statement: Robots are
better than humans in all business capacities.

IIM Kozhikode 15
Case: Business is Booming for
Wearable Technologies
 Case: Business is Booming for
Wearable Technologies
Questions:
1. Define the three primary types of decision-making systems and how
robots in the workplace could affect each.
2. Describe the difference between transactional and analytical
information, and determine how wearable technology could affect
each for a grocery store.
3. Illustrate the business process model used by a customer service
repair technician using wearable technology glasses to fix a broken
computer.
4. Explain business process reengineering and how wearable
technology might dramatically change the current sales process.
5. Formulate different metrics that a wearable technology for fitness
could provide a customer.
6. Argue for or against the following statement: Wearable devices
invade consumer privacy.
 Opening Case: Hello Fresh, Hello
Delicious
Questions:
1. Do you consider HelloFresh a form of disruptive or
sustaining technology?
2. Is HelloFresh an example of Web 1.0 or Web 2.0?
3. Describe the ebusiness model HelloFresh has
implemented
4. Describe the revenue model HelloFresh has
implemented?
5. What is HelloFresh’s competitive advantage?
6. What are the security and trust issues surrounding
HelloFresh?
 Case: Slack – Be Less Busy
Questions:
1. Do you consider Slack a form of disruptive or sustaining
technology? Why or Why Not?
2. What types of security and ethical dilemmas are facing Slack?
3. Describe the ebusiness model for Slack.
4. Describe the revenue model for Slack.
5. Categorize Slack as an example of Web 1.0 or Web 2.0.
6. Explain the four characteristics of Business 2.0 and how each
applies to Slack.
7. How could Slack use social networking analysis to help
organizations function more efficiently?
Opening Case: Big Data, Big Business,
Big Opportunity
Questions:
1. List the reasons a business would want to display
information in a graphic or visual format.
2. Explain how issues with low-quality information will impact
big data
3. Explain how a marketing department could use data
visualization tool to help with the release of a new product
4. Categorize the five common characteristics of high-quality
information and rank them in order of importance for big data
5. Develop a list of some possible entities and attributes
located in a marketing database
6. Assess how a business could use a few of the data analysis
techniques to understand how the business is operating.
Case: Data Visualization: Stories for the
Information Age
Questions:
1. Identify the effects poor information might have on a data
visualization project
2. How does data visualization use database technologies?
3. How could a business use data visualization to identify new
trends?
4. What is the correlation between data mining and data
visualization?
5. Is data visualization a form of business intelligence? Why or
why not?
6. What security issues are associated with data visualization?
7. What might happen to a data visualization project if it failed
to cleanse or scrub its data?
Systems Development and Project
Management
 Opening Case: Gamer Delight
Questions:
1. What are the three interdependent variables shaping project
management? Why are these variables important to a video game
software development company?
2. If you were consulting to a business that wanted to build a video
game for the iPhone, which development methodology would you
recommend and why?
3. Illustrate the triple constraints role when building anew game. Why
is the cost of finding errors important to a business when
developing and designing video games?
4. What is a prototype and why would a new game benefit from
building one?
5. Which phase in the systems development life cycle is most critical
when building a video game? Which phase in the systems
development life cycle is least critical when building a video game?
6. What are the ethical and security issues associated with
outsourcing the development of a video game to India or China?
 Closing Case: Disaster at Denver
International Airport
Questions:
1. One of the problems with DIA’s baggage system was
inadequate testing. Why is testing important to a project’s
success.
2. Evaluate the different systems development methodologies.
Which one would have most significantly increased the
chances of the project’s success?
3. How could more time spent in the analysis and design phase
have saved Colorado taxpayers hundreds of millions of
dollars?
4. Why could BAE not take an existing IT infrastructure and
simply increase its scale and expect it to work?
Projects: Looking at Definition

A project is a sequence of unique, complex, and

connected activities having one goal or purpose and
that must be completed by a specific time, within
budget, and according to specification.

Activity C
Activity E
Activity A
Activity D
Activity
B

What’s missing from this definition?

 Project Management

Project Incorporates

Resources Budget Time

Project Constraints: Iron Triangle

QUALITY

Scope

Iron Triangle of Project Management

Software Project Failures
Standish Report

IIMK 28
Some Statistics: Standish Report
Standish Project Benchmarks
Year Successful(%) Challenged(%) Failed(%)
1994 16 53 31
1996 27 33 40
1998 26 46 28
2000 28 49 23
2002 34 51 15
2004 29 53 18
2006 35 46 19
2008 32 44 24
2010 37 42 21
2011 29 49 22
2012 27 56 17
2013 31 50 19
2014 28 55 17
2015 29 52 19

IIMK 29
 Project Failure: Cited Reasons
■ The 1998 Bull survey, conducted by the French computer
company Bull, identified the major causes of information
technology (IT) project failure as a breakdown of communications,
a lack of planning, and poor quality control.
■ KPMG Canada, in 1997, identified the core project failure issues
as poor planning, weak business case, and a lack of top
management involvement and support.
■ The Standish Group’s 1995 Chaos Report named incomplete
requirements and lack of user involvement as reasons for project
failure.
■ The OASIG Study, published in 1995 by a U.K. group studying
organizational aspects of information technology, cited lack of
attention to the human and organizational aspects, poor project
management, and poor articulation of user requirements as
reasons why projects failed.
IIMK 30
 Software Project Manager: Reality

Bosses
• Ambitious Goals
• Quick Schedule • No overruns
Customers • Low Budget • No Surprises
• No Bugs
Software • Well Documented
Project • Easy to Change Maintainers
Manager

• Fast Career Path

Users • Lots of Functions
• Preference for Design
• User Friendly
• Defer Documentation
• Fast, Robust

Subordinates
What Makes Software Project Implementation
Difficult?
• Complexity and Uncertainty
• Team Cohesion
• Customer Involvement
• Specification
• Change
• Business Value

IIMK
32
 Software Development: Important
Questions
• What are the characteristics of the software to
be developed?
• What software development approach is
appropriate for building the software?
• What project management approach is
appropriate for managing the chosen software
development process?

IIMK 33
SDPM Strategies

IIMK 34
SDPM Strategies

IIMK 35
SDPM Strategies

IIMK 36
SDPM Strategies

IIMK 37
SDPM Strategies

IIMK 38
 Software Development Methodologies

• Major software development methodologies:

• Waterfall
• Agile
• Rapid application development (RAD)
• Rational unified process (RUP)
• Scrum
• Extreme programming
 Linear PM Models

SCOPE DESIGN BUILD TEST DEPLOY

 Waterfall Methodology
Waterfall
methodology –
A sequence of
phases in which
the output of
each phase
becomes the
input for the
next.
 Incremental Models

SCOPE DESIGN BUILD TEST DEPLOY

 Agile Methodology
 Iterative development – Consists of a series of
tiny projects
• Agile methodology – Aims for customer
satisfaction through early and continuous
delivery of useful software components
developed by an iterative process using the
bare minimum requirements
 Iterative PM Models

Y Y
SCOPE DESIGN BUILD TEST CHECK DEPLOY

N N
 Rapid Application Development
Methodology (RAD)
• Rapid application development methodology–
Emphasizes extensive user involvement in the
rapid and evolutionary construction of working
prototypes of a system to accelerate the systems
development process
 Prototype – A smaller-scale representation or
working model of the users’ requirements or a
proposed design for an information system
• The prototype is an essential part of the analysis
phase when using a RAD methodology
 Rapid Application Development
Methodology (RAD)

Rapid Development
Waterfall Method
 Iterative Methods
Evolutionary Development Waterfall Model
Rational Unified Process (RUP) Methodology
• Rational Unified Process (RUP) – Provides a framework for
breaking down the development of software into four
gates
• Gate One: Inception
• Gate Two: Elaboration
• Gate Three: Construction
• Gate Four: Transition
 SCRUM Methodology
• SCRUM – Uses small teams to produce small pieces of
deliverable software using sprints, or 30-day intervals, to
achieve an appointed goal
• Under this methodology, each day ends or begins with a
stand-up meeting to monitor and control the development
effort
 Adaptive Methodology
• An Adaptive SDPM strategy is one that proceeds from iteration
to iteration based on very limited specification of solution. Each
iteration learns from the proceeding ones and redirects the next
iteration in an attempt to converge on an acceptable solution. At
the discretion of the customer an iteration can release a partial
solution.
 Adaptive PM Models

Y Y
SCOPE DESIGN BUILD TEST CHECK DEPLOY

N N
 Extreme PM Models

Y Y
SCOPE DESIGN BUILD TEST CHECK DEPLOY

N N
 Extreme Programming

INSPIRE

IIMK 53
 All PM Models
SCOPE DESIGN BUILD TEST DEPLOY
LINEAR
TRADITIONAL
SCOPE DESIGN BUILD TEST DEPLOY
INCREMENTAL

Y Y
SCOPE DESIGN BUILD TEST CHECK DEPLOY

N
AGILE ITERATIVE N

Y Y
SCOPE DESIGN BUILD TEST CHECK DEPLOY

ADAPTIVE
N N

Y Y
SCOPE DESIGN BUILD TEST CHECK DEPLOY

EXTREME EXTREME N N
The END

IIM Kozhikode