Submitted by: Submitted by sallyshuxuan
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Category: Science and Technology
Date Submitted: 11/05/2013 08:58 PM
Course objectives
How IT creates value and how can companies capture that value.
Team case assignment
1. an excel file 2. A brief report 2 pages
Midterm
Session 8
Cover all sessions 1-7
Paper based open book exam
Final project
Project plan is due in session 4 and the final report(7-10 pages) is due before the start of session 10.
Class 1 10/02/13
Elements of a business model
* value disciplines
* profit model
* logic(what business process you put in)
Elements of Business Model
Value Discipline
* Operational Excellence---Cost, reliability, timeliness, etc
Product Leadership(focus on product and service performance)
* Deliver best products/services
* Development speed and time-to-market
Customer Intimacy
* Tailor products/services to customers’ unique needs
* Collection, management and use of customer data
EXAMPLE
Profit Model
1. Revenue Models
Transactional
* Metered
* Outcome-based
Subscription
Licensing
2. Cost Structure
* Fixed cost vs. variable cost
How has IT changed the revenue models and cost structures in some business?
1. Online shopping instead of traditional stores. Eliminate fixed cost, you don’t have to hire many sales persons.
2. Pandora and ITunes (subscription based model)
IT-enabled profit models
1. Revenue Model
* Create new sources of revenue
e.g, digital/virtual products
* Enable new revenue models
e.g, outcome-based( most online media don’t need to pay if customer didn’t click it, not like traditional newspaper model)
* Improve traditional revenue models
Dynamic or personalized pricing
2. Cost Structure
* Digitation of products and business processes
Wal-Mart Case
Amazon.com case
Operational excellence
---low cost
---Timeliness
Role of IT
Justin time---own inventory---inventory outsourcing (become intermediary)
Customer intimacy
---Personalized recommendation
Benefit:
1. Lower search cost...