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Lecture 1

SCMS 431 Lecture Notes - Lecture 1: Grubhub, Airbnb, Customer Experience

Supply Chain Management Systems
Course Code
SCMS 431
Savilana Trimi

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Disruptive IT Impacts Companies, Competition, and Careers
1. Doing Business in the On-Demand Economy- the economic activity created by
technology companies that fulfill consumer demand through the immediate
provisioning of products and services
Propelled by proliferation of:
- smartphone-connected consumers
- simple and secure purchase flows
Location-based services
Growth of app-driven companies like Airbnb, Uber, GrubHub have disrupted
Business model- an enterprice generates revenue or sustains itself
Digital business model- refer to how companies engage their customers
digitally to create value via websites, social channels, and mobile devices
Customer experience(CX)- about building the digital infrastructure that
allows customers to do whatever they want to do, through whatever channel
they choose to do it
Product development- IT helps businesses respond quickly to changing
customer demands
Stakeholder integration- companies use their investor relations websites to
communicate with shareholders, research analysts, and others i market
Process improvement- an ERP systems replaces dozens of legacy
systems for finance, human resources, and other functional areas, to increase
efficiency and cost-effectiveness of internal business processes
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Cost efficiencies- IT allows companies to reduce transaction and
implementation costs, such as costs of duplication and postage of email vs
snail mail
Competitive advantage- companies can use agile development, prototyping,
and other systems methodologies to bring a product to market cost effectively
and quickly
Globalization- companies can outsource most of their non-core functions,
such as HR and finance, to offshore companies and use ICT to stay in
contact with its global employees, customers and suppliers 24/7
2. Business Process Improvement and Competitive Advantage
Business process- a series of steps by which an organization coordinates
and organizes tasks to get work done
Process- comprised of the activities that convert inputs into outputs by doing
Deliverables- outputs created through work toward a desired benefit or
expected performance improvement
Performance- a result of processes where maximizing efficiency over one’s
competitors is a critical success factor
- Inputs: raw materials, data, knowledge, expertise
- Activities: work that transforms input & acts on data and knowledge
- Deliverables: products, services, plans, or actions
Business process characteristics:
- Formal Processes or Standard Operating Procesures (SOP):
documented and have well-established steps
- Informal Processes: typically undocumented, undefined, or are
- Range from slow, rigid to fast-moving, adaptive
- Can be rigid, resistant to change, or adaptive, responding to change
Process Improvement:
- Continuous examination to determine whether processes are still
necessary or operating at peak efficiency by eliminating wasted steps
called Business Process Reengineering (BPR)
- Digital technology enhances bprocess by:
a. Automating manual procesures
b. Expanding data flows to reach more functions and parallel
sequential activities
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