Information Technology: Its Impact on Business Education

1. Information Technology: Its Impact on Business Education Presented by Frederick H. Wu, Ph.D., CMA Emeritus Professor University of North Texas October 30, 2009

2. All the Business exists to create “Value” • I am confident that we will rise to the challenge of delivering for our shareowners and customers in 2009. ---Verizon Communications 2008 Annual Report • We remain committed to growing long-term value to our Shareholders… • ---ExxonMobil 2007 Annual Report • Service is more robust in a downturn because it create value for our customers. Service value for our customers comes from two Streams: customer efficiency thru system performance and…; and Customer productivity thru process improvement and data manage- ment. • ---General Electric 2008 Annual Report

3. Value Creation Value to Customers Innovation Cycle Operation Cycle Post Sales Service Cycle Customer Need Identified Service The Customer Identify the Market Create the Product/ Service Build Product/ Service Deliver Product/ Service Revenues Interfaced by Information Technology Profit Value To Stock- Holders & Society Resources: Fixed Assets; Human Assets; Intangible Assets Costs Value to Suppliers

4. Top Priorities for Business in Today’s Changing Landscape: Corporate Strategies • Strategies for driving growth • Methods for managing talents • Ideas for improving relationships with customers and • suppliers BusinessWeek, March 23 & 30 2009

5. Strategy as a Position • Cost leadership (efficiency) Examples: Wal-Mart, Kia, Dell • Product leadership (differentiating): • Higher qualities (endurance, safety, timely delivery, reliability, after-sales services, etc.) Examples: Toyota, Starbucks, Google • Unique products through innovation (Blue Ocean) Wines (Yellow Tail)

6. Relationship between Business Processes, Information Processes, and Management Processes: Business Model Culture Goals and Strategy Management Control System Suppliers Management of Business Processes Operational Processes Management Processes Acq./Pmt Process Information System Plan Maintain Data Conversion Process Capture Data Provide Information Execute Support Processes Control Communication System Sell/Collect Process Market Evaluate Organizational structure Supporting Processes:Human resources, Financing, Research & development, etc

7. “Investing in the IT that Makes a Competitive Difference” • In Harvard Business Review, by McAfee and Brynjolfsson, • July-August 2008: • The link between technology and competition has • become much stronger since the mid-1990s. • Information technology such as the internet and • enterprise software applications (ERP, CRM, SRM, • enterprise content management (ECM) became • practical tool for business.

8. “Information Technology Capability: Firm Valuation, Earnings Uncertainty, and Forecast Accuracy,” in Journal of Information Systems, Fall 2007 IT capability is positively associated with future earnings Uncertainty…

9. “An Empirical Study of the Organizational Impact of Effective Information Technology Deployment,” in “International Journal of Management Theory and Practices,” By Wilfred Wu et al., August 2005 When IT applications and business strategy have a good fit, it contributes to a firm’s financial performance significantly.

10. IT Architecture • Definition: “The blueprint of a firm’s IT architecture defines the technical computing, information management, and communications platform.”

11. Components of IT Architecture Value – Creating Business Opportunities Commerce Content Community Value – Enabling IT Infrastructure Solutions and Services • Internet service providers • Systems integration services • Outsourcing and hosting • Enterprise Resource Planning • (e.g., SAP and People Soft) • Supply chain management Software Productivity and Development Tools • Packages (Word processing, spreadsheets, e-mail package, etc.) • Programming Languages (C++, Visual Basic, Cobol, Basic, etc) Computing Communications • Hardware (computers, printers, etc) • Operating systems • Database management systems • Document management systems • Hardware (networks, routers, etc.) • Network Operating systems • Gateways • E-mail and file transfer services

12. Implications for Business Education • As a proficient knowledge worker, a student should, first of • all, have a broad understanding of how firm works to • create value for stakeholders: a successful “business • model.” • As a PKW, a student should develop his/her specialization • coupled with a good IT skills.

13. Implications • To understand how firm works to create value, a student • take the following required business core courses: • Accounting (6 hours) • Finance (3 hrs) and investment/commodity future (3 hrs) • Marketing (3 hours) • Management (behavioral and quantitative: 6 hours) • MIS (6 to 9 hrs) • Ethics (1-3 hrs) • Policy and Strategy (strategic management: 3 hrs) • Economics (6 hrs)

14. Implications As a PKW, a student should develop the following skills: Leadership Communications (oral and written) Ability to work in a team or group High level of analytical ability Multi-language (global business: The World is Flat) Professionalism/work ethics Learn to learn

15. Implications • We, Professors, should adopt the following for teaching: • Use case approach to allow students to make • presentations and participate in discussion in class • Use group learning approach in class to allow students • to learn listening, cooperation, and leadership abilities • Ability to speak well in presentation or class discussion • is a part of the course grade, in addition to the written • report. • 4. Use IT to enhance real-time interaction with students.

16. Implications – continued Pursue the following career paths: Accounting firms: • Systems audit • IT consultant Industries/corporate firms: • Operations Analyst

17. The End