1. MASTER IN MANAGEMENT PROGRAM PPM - School of Management
INTRODUCTION CORPORATE INFORMATION SYSTEM & UNDERSTANDING BUSINESS MODEL Session 01
Lecturer : JONATHAN SOFIAN LUSA
Reading materials :
Applegate : Introduction, chapter 1
MASTER IN MANAGEMENT PROGRAM
PPM - School of Management
DEC Week I
0CT

2. Chapter Outline 1 2 3 Introduction Terminology
Understanding Business Model 2

3. TERMINOLOGY

4. Technology, Business, and Societal Evolution during the 20th century
1900
1950
2000
Agricultural
Economy
Industrial
Information
Typical mathematical formula:
D=B 2
-4AC
Equivalent FORTRAN statement: **
2-4*A*C
Telegraph
Technology Evolution
Social and Business Evolution
Photos reprinted with permission from
AT&T and IBM
Source: Applegate, Lynda M., Robert D. Austin, and F. Warren
McFarlan ,
Corporate Information Strategy and Management
. Burr Ridge, IL:
McGraw -
Hill/Irwin, 2002.
Chapter 1 Figure 1 - 2

5. OPPOSING VIEWS OF INFORMATION TECHNOLOGY FUNCTION
Business executives view of IT
Apprehensive
Technocracy
New feature focus
Little relevance to real world
IT executives view of business
Short-sighted
Lacking in vision
Unwilling to exploit IT VS

6. Business executives view of IT
IT = Cost Center
IT does not understand business
IT does not demonstrates leadership

7. IT executives view of business
Business lack close relationships
IT does not prioritize well
Senior executives do not support IT

8. Alternative Solutions
Budget
Career crossover
CIO-CEO
Communicate/market/negotiate
Education/cross-training
Liaison
Location
Organization (Centralized, Decentralized, Hybrid )

9. EVOLVING BUSINESS MODELS
Components of business model :
STRATEGY / CONCEPT : describe the opportunity and strategy.
VALUE : measures the benefits.
CAPABILITIES : define resources needed to execute strategy.
INDUSTRIAL ECONOMY PARADIGM :
Relatively clear and steady business model.
Easy to define business model.
NETWORK ECONOMY PARADIGM :
Somehow, it is quite difficult to define a clear business model.
Business model should be explained in detail way. 9

10. BUSINESS MODEL
A business model defines how an enterprise interacts with the environment to define a unique strategy, attract the resources and the capabilities required to execute the strategy, and to create value for all stakeholders ( 8th edition, Lynda M Applegate)
A business model guides and assists management in the process of strategy formulation.
A successful business model aligns an organization with its environment well.

11. Evolving Business Models
Source: Applegate, Lynda M., Robert D. Austin, and F. Warren
McFarlan ,
Corporate Information Strategy and Management
. Burr Ridge, IL:
McGraw -
Hill/Irwin, 2002.
Chapter 2 Figure 2 - 1
What business are you in?  What is you business model?
Who are our customers? Our suppliers?
ASP models

12. Collaboration to Compete (IOS)
New Products  TV Cable Package (TV Cable+decoder+Parabola)
New Services  Bank + Live Insurance + Hospital + Café + Tour + Hotel
Efficiency (cheaper, faster, better)  ATM Bersama
Joint Operation ( services)  Billing Telephone, PAM, PLN + Bank
Strategic Alliances ( generic + Long term)  Insurance lokal + International, School, University
Customer Supplier Relationship (cheaper, faster, better)  Textile industry
Outsourcing  Call Center, Customer Service, Security
Image Building  Joint Venture local + International

13. OUR LEARNING POINTS FOR TODAY …
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14. THANK
YOU