Technology and Strategic Consulting Ppt

7/31/2019 Technology and Strategic Consulting Ppt

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INTRODUCTION

What is Technology.

Contribution of Technology to business

performance: Economic analysis.

Technological and performance enhancement


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VARIOUS DEFINITIONS OF TECHNOLOGY

Technology can be most broadly defined as the entities, both

material and immaterial, created by the application of

mental and physical effort in order to achieve some value. Technology refers to tools and machines that may be used to

solve real-world problems. It is a far-reaching term that may

include simple tools, or more complex machines.

Technology can be viewed as an activity that forms or changesculture. Additionally, technology is the application of math,

science, and the arts for the benefit of life as it is known.


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GENERIC EXAMPLES OF TECHNOLOGY

The telegraph facilitated the formation of geographically dispersedenterprises.

The electric motor provided industrial engineers more flexibility in theplacement of machinery in factories, dramatically improving

manufacturing productivity by enabling workflow redesign.

The steam engine was at the root of a broad cluster of technological andorganizational changes that helped ignite the first industrial revolution.

Recent technological developments, including the printing press, thetelephone, and the Internet, have lessened physical barriers to

communication and allowed humans to interact freely on a global scale. The development of weapons.

The innovation of computers, laptop, mobile phone.


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CONTRIBUTION OF TECHNOLOGY TO BUSINESS

PERFORMANCE: ECONOMIC ANALYSIS.

Contribution of Information Technology in Banks.

Use of internet in Organizations.

Use of video Conferencing.

Use of computers for Supply Chain Management.

Use of Machinery for manufacturing purpose. Online Marketing.


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ECONOMIC ANALYSIS: AN EXAMPLE

A

(1000)

G

C

(500)

F

(2500)

E

(2000)

D

(500)

B

(500)100 KM 150 KM

95 KM

300 KM

400 KM

300 KM

50 KM

50 KM

50 KM50 KM

100 KM

150 KM


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TECHNOLOGICAL AND PERFORMANCE

ENHANCEMENT Medical Technology.

Information Technology.

Weapons.

Space Technology. (GPS, climate and weather analyses,

communication and TV reporting.)

Mobile Phones.

Car Manufacturing.


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THE PORTERS VALUE CHAIN

The idea of the value chain is based on the process view oforganizations, the idea of seeing a manufacturing (or service)organization as a system, made up of subsystems each withinputs, transformation processes and outputs. Inputs,

transformation processes, and outputs involve the acquisitionand consumption of resources - money, labour, materials,equipment, buildings, land, administration and management.How value chain activities are carried out determines costsand affects profits.

Most organizations engage in hundreds, even thousands, of

activities in the process of converting inputs to outputs. Theseactivities can be classified generally as either primary orsupport activities that all businesses must undertake in someform.


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ACCORDING TO PORTER (1985), THE PRIMARY ACTIVITIES ARE:

Inbound Logistics - involve relationships with suppliers and include all the activities

required to receive, store, and disseminate inputs.

Operations - are all the activities required to transform inputs into outputs (products andservices).

Outbound Logistics - include all the activities required to collect, store, and distribute

the output.

Marketing and Sales - activities inform buyers about products and services, induce

buyers to purchase them, and facilitate their purchase.

Service - includes all the activities required to keep the product or service workingeffectively for the buyer after it is sold and delivered.

SECONDARY ACTIVITIES ARE:

Procurement- is the acquisition of inputs, or resources, for the firm.

Human Resource management- consists of all activities involved in recruiting, hiring,

training, developing, compensating and (if necessary) dismissing or laying off personnel.

Technological Development- pertains to the equipment, hardware, software,

procedures and technical knowledge brought to bear in the firm's transformation of

inputs into outputs.

Infrastructure - serves the company's needs and ties its various parts together, it

consists of functions or departments such as accounting, legal, finance, planning, public

affairs, government relations, quality assurance and general management.


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The value chain is a concept from business management that

was first described and popularized by Michael Porter in his1985.

Products pass through all activities of the chain in order, and at

each activity the product gains some value. The chain of activities

gives the products more added value than the sum of theindependent activities' values. A diamond cutter, as a profession,

can be used to illustrate the difference of cost and the value

chain. The cutting activity may have a low cost, but the activity

adds much of the value to the end product, since a rough

diamond is significantly less valuable than a cut diamond.


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PORTERS VALUE CHAIN


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WHAT IS VALUE AND VALUE CHAIN? Porter defined value as the amount buyers are willing to

pay for what a firm provides, and he conceived the value

chain as the combination of nine generic value added

activities operating within a firm activities that worktogether to provide value to customers.

The primary focus in value chains is on the benefits that

accrue to customers, the interdependent processes thatgenerate value, and the resulting demand and funds flows

that are created. Effective value chains generate profits.


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VALUE IN B2B COMMERCIAL

TRANSACTIONS Technical (Resource Value): Technical value is intrinsic to the

resource being provided and occurs in virtually all exchanges. Organizational (Business Context): Organizational value is built

upon the context of the exchange, and may derive from a range of

factors such as ethical standards, prestige, reliability, andassociation. Brand image may build organizational value, as wellas company reputation.

Personal (Career and Idiosyncratic): Personal value is derivedfrom the personal experiences and relationships involved in theexchange of resources and the benefits provided. Managermotivation, preferences, feelings of comfort and trust create

value for individuals that engage in trading relationships onbehalf of firms, and can be extremely influential in thedetermination of successful exchange.


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COMPETITIVE ADVANTAGEOne can say that a firm has a competitive advantage when it is

able to create more economic value than its rivals.

Economic value, in turn, is simply the difference between the

perceived value of a good to a customer and the total costs perunit, including costs of capital, to produce the good. Thus, the

magnitude of a firms competitive advantage is the difference

between the perceived value created and the costs to produce

the good or service compared to its direct competitors.

If the economic value created is greater than that of its

competitors, the firm has a competitive advantage; if it is equal to

the competitors, the firms are said to have competitive parity;

and if it lower than its rival firms, the firm has a competitive

disadvantage.


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PROFITABILITY DEPENDS ON THREE

FACTORS:

(1)Perceived value created for customers.

(2) The price of the product or service.(3) The total costs of producing the product or service.


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INTERNAL AND EXTERNAL ANALYSIS

To create and sustain competitive advantage, the firmsmanagers must understand the firms internal strengthsand weaknesses as well as its opportunities and threats that

present themselves in the firms external environment. A firms strategy should leverage a firms strengths while

mitigating its weaknesses, or acquire new resources andbuild new capabilities and competencies to turn

weaknesses into strengths.

To obtain a competitive advantage, a firm must havecompetencies that allow it to create higher perceived valuethan its competitors or to produce the same or similarproducts at a lower cost or to do both simultaneously.


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STRATEGY IN TECHNOLOGY INTENSIVE

INDUSTRIES Today, technological innovation is in many industries the

most important driver of competitive advantage. Reasons

for the increasing importance of innovation in many

industries include deregulation, globalization, rapidtechnological progress.

Technology helps in the competitive advantage.

Customer Relationship Management Software.

Computer Networking.

Automation Software.

Enterprise Resource Planning Software.


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TECHNOLOGY OPTIMIZATION The goal of technology optimization is to identify and/or develop, and

use small- and large-scale tools in the form of models, processes,

methods, and devices to eliminate waste and constraints.

Large-scale Information Optimization (Organization |Community | Nation | Federation):

Informatics & Knowledge Management

Enterprise Architecture | Integration | Management

ERP

Small-scale Information Optimization (Individual | Team | Group

| Board):

Customer Relationship Management.

Manual & Desktop Processes.

Documents & Spreadsheets & Lists & Archives & Folders & e-Mail .


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VALUE CHAIN OPTIMIZATION

Value chain optimization processes and practicesreduce risk, engage stakeholders and drivesustainability across the entire value chain. It

accelerate organizational learning and effectiveness.

Example: SAR system given by IBM for Value Chain

Optimization.