Fundamentals of Information Systems - Module 2: Organizational Strategy, Competitive Advantage, and Information Systems

Flashcards covering business processes, process improvement methodologies (BPR, BPI, BPM), business pressures, and competitive advantage strategies including Porter's models.

Business Process

A continuous series of related tasks or activities that collectively produce a product or service of value to an organization, its customers, and its partners.

Inputs

The materials, services, or information that enter the process and are transformed through various activities.

Resources

The people, equipment, and systems involved in performing the process tasks.

Outputs

The final product or service delivered by the process to meet customer or business needs.

Internal customers

Individuals within the organization, such as a manager receiving an internal report.

External customers

Individuals or businesses outside the organization purchasing products or services.

Efficiency

A metric measuring how well the process operates, focusing on minimizing delays, costs, and resource usage.

Effectiveness

A metric evaluating whether the process delivers the desired outcomes and value to the customer.

Functional process

A process limited to a single department, such as payroll processing within Human Resources.

Cross-functional process

A process that spans multiple departments, such as product development.

Business Process Reengineering (BPR)

A radical redesign strategy that involves starting from a 'clean slate' to completely rethink and restructure processes for dramatic performance improvements.

Business Process Improvement (BPI)

An incremental approach to improving existing processes by identifying root causes or defects and inefficiencies.

Six Sigma

A data-driven method for BPI that uses statistical analysis to reduce defects, typically targeting $3 - 4$ defects per million opportunities.

Process owner

The manager responsible for a specific business process.

DMAIC

A five-step problem-solving framework used in Lean Six Sigma consisting of: Define, Measure, Analyze, Improve, and Control.

Define (DMAIC)

The step where a graphical view of the current 'as is' process is created and the problem to solve is identified.

Measure (DMAIC)

The step involving the selection of metrics such as cost or time and collecting data from systems or surveys.

Analyze (DMAIC)

The step where data and diagrams are used to locate inefficiencies, bottlenecks, and root causes.

Improve (DMAIC)

The step focusing on developing solutions, removing non-value-adding activities, and reordering steps.

Control (DMAIC)

The final step where process metrics are established to track whether the new process remains stable and performance stays improved.

Business Process Management (BPM)

A management technique that includes methods and tools to support the design, analysis, implementation, management, and optimization of business processes.

Process Modeling

A component of BPM that creates a graphical map of the process steps, people involved, and task dependencies.

Business Activity Monitoring (BAM)

A component of BPM used to measure and manage processes in real time to identify delays or failures quickly.

BPMS Tools

Integrated applications (e.g., Appian, Camunda) that store process maps, model processes, and coordinate workflows.

Globalization

The integration of economies and cultures worldwide, enabled by IT, which increases competition by removing geographical boundaries.

Information Overload

A technology pressure resulting from an explosion of available data, requiring IT tools like search engines for effective analysis.

Strategic Systems

Information systems designed to provide companies a competitive advantage, such as Amazon's personalized recommendation system.

Make-to-Order

A strategy of producing customized products tailored to individual customer specifications.

Mass Customization

Combining mass production efficiency with the ability to customize products at scale.

E-Commerce

The process of buying, selling, and exchanging goods, services, or information online.

E-Business

A broad concept including e-commerce, customer service, collaboration with partners, and internal electronic transactions.

Competitive Strategy

A plan describing how a firm competes, its goals, and the policies required to carry out those goals.

Competitive Advantage

Outperforming rivals in critical areas such as cost, quality, speed, service, or innovation.

Strategic Information System (SIS)

Any information system that helps an organization gain a competitive advantage or reduce a competitive disadvantage.

Porter’s Five Competitive Forces

A model used to design strategies based on: Threat of new entrants, Supplier power, Buyer power, Threat of substitutes, and Rivalry among existing firms.

Value Chain

A sequence of activities through which an organization's inputs are transformed into more valuable outputs.

Primary Activities

Business activities directly involved in the creation, sale, delivery, and support of the product or service.

Support Activities

Activities that do not add value directly to the product but support primary activities (e.g., HR, accounting, R&D).

Inbound Logistics

A primary activity focusing on receiving, storing, and managing inputs.

Outbound Logistics

A primary activity focusing on packaging, storing, and distributing finished products to customers.

Procurement

A support activity involving supplier management, purchasing, and funding.