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16.1 © 2006 by Prentice Hall
16Chapter
Managing InternationalManaging International
Information SystemsInformation Systems
16.2 © 2006 by Prentice Hall
• Identify the major factors driving the
internationalization of business
• Compare strategies for developing global
businesses
• Demonstrate how information systems can support
different global business strategies
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
OBJECTIVES
16.3 © 2006 by Prentice Hall
• Evaluate the issues and technical alternatives to be
considered when developing international
information systems
• Identify the challenges posed by global information
systems and management solutions
OBJECTIVES (Continued)
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
16.4 © 2006 by Prentice Hall
• Challenge: Fulfill customer orders made to a network
of forty subsidiaries in Europe, Asia, and North
America whose systems could not share data with one
another
• Solutions: develop a single corporate database and
use middleware with standard interfaces to connect
all the subsidiary’s systems
• Develop a single worldwide data model with standard
definitions and codes
• Illustrates the role of systems in an international
environment for reducing inventory and business
process costs worldwide.
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
Drager Safety AG Case
16.5 © 2006 by Prentice Hall
THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS
Global Product Development and Production
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
Figure 16-1
16.6 © 2006 by Prentice Hall
• The basic information systems required by
organizations to coordinate worldwide trade
and other activities
Developing an International Information SystemsDeveloping an International Information Systems
ArchitectureArchitecture
International information systems architecture:
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS
• A force in the environment to which businesses
must respond and that influences the direction
of the business
Business driver:
16.7 © 2006 by Prentice Hall
International Information Systems Architecture
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS
Figure 16-2
16.8 © 2006 by Prentice Hall
The Global Environment: Business Drivers and ChallengesThe Global Environment: Business Drivers and Challenges
The global business drivers can be divided into two
groups:
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS
• Global communication and transportation
technologies
• Development of global culture
General cultural factors:
Table 16-1
16.9 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS
• Emergence of global social norms
• Political stability
• Global knowledge base
Table 16-1 (Continued)
General Cultural Factors: (Continued)
16.10 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS
• Global markets
• Global production and operations
• Global coordination
• Global workforce
• Global economies of scale
Specific business factors:
Table 16-1 (Continued)
16.11 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS
Business Challenges
• Cultural particularism: Regionalism, nationalism,
language differences
• Social expectations: Brand-name expectations,
work hours
• Political laws: Transborder data and privacy laws,
commercial regulations
General:
Table 16-2
16.12 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS
• Standards: Different Electronic Data Interchange
(EDI), telecommunications standards
• Reliability: Phone networks not uniformly reliable
• Speed: Different data transfer speeds, many
slower than United States
• Personnel: Shortages of skilled consultants
Specific:
Table 16-2 (Continued)
16.13 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
ORGANIZING INTERNATIONAL INFORMATION SYSTEMS
Three kinds of organizational structure:
• Centralized (in the home country)
• Decentralized (to local foreign units)
• Coordinated (all units participate as equals)
Global Strategies and Business Organization
16.14 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
ORGANIZING INTERNATIONAL INFORMATION SYSTEMS
• Heavy centralization of corporate activities in
the home country of origin
Domestic exporter strategy:
• Centralized financial management and control
while decentralizing production, sales, and
marketing operations to units in other
countries
Multinational strategy:
16.15 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
ORGANIZING INTERNATIONAL INFORMATION SYSTEMS
• The product is financed and initially produced
in the home country, but for product-specific
reasons rely on foreign personnel for further
production, marketing, and human resources.
Franchisers:
• The value-adding activities are managed from a
global perspective without reference to national
borders, optimizing sources of supply and
demand wherever they appear, and taking
advantage of any local competitive advantages.
Transnational strategy:
16.16 © 2006 by Prentice Hall
Global Systems to Fit the StrategyGlobal Systems to Fit the Strategy
Global Strategy and Systems Configurations
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
ORGANIZING INTERNATIONAL INFORMATION SYSTEMS
Figure 16-3
16.17 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
1. Centralized systems: Systems development and
operation occur totally at the domestic home
base.
2. Duplicated systems: Development occurs at the
home base but operations are handed over to
autonomous units in foreign locations.
Four types of systems configuration:
ORGANIZING INTERNATIONAL INFORMATION SYSTEMS
16.18 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
3. Decentralized systems: Each foreign unit
designs its own unique solutions and
systems.
4. Networked systems: Systems development
and operations occur in an integrated and
coordinated fashion across all units.
ORGANIZING INTERNATIONAL INFORMATION SYSTEMS
Four types of systems configuration: (Continued)
16.19 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
ORGANIZING INTERNATIONAL INFORMATION SYSTEMS
• Organize value-adding activities along lines of
comparative advantage
• Develop and operate systems units at each level of
corporate activity —regional, national, and
international
• Establish at world headquarters
Reorganizing the Business
To develop a global company and information systems
support structure:
16.20 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
MANAGING GLOBAL SYSTEMS
• Agreeing on common user requirements
• Introducing changes in business processes
• Coordinating applications development
• Coordinating software releases
• Encouraging local users to support global systems
Management Challenges in Developing Global Systems
Table 16-4
16.21 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
MANAGING GLOBAL SYSTEMS
• Define the core business processes: Conduct
workflow analysis, identify centers of excellence
for these processes
• Identify the core systems to coordinate centrally:
Conquer the core systems and define these
systems as truly transnational
• Choose an approach: Incremental, Grand Design,
Evolutionary
• Make the Benefits Clear
Global Systems Strategy
16.22 © 2006 by Prentice Hall
Local, Regional, and Global SystemsLocal, Regional, and Global Systems
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
MANAGING GLOBAL SYSTEMS
Figure 16-4
Source: Adapted from Managing
Information Technology in
Multinational Corporations by
Edard M. roche, copyright 1993.
16.23 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS
Computing platforms and systems integration:
• Develop global, distributed, and integrated
systems to support digital business processes
spanning national boundaries
• Use of same hardware and operating system
does not guarantee integration.
• Establish data and technical standards
Technology Challenges of Global Systems
16.24 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS
• Overcoming disparate national technical
standards, data exchange restrictions and
service levels
• User of Internet technology to create
global intranets, extranets, virtual private
networks (VPNs)
Connectivity:
Technology Challenges of Global Systems (Continued)
16.25 © 2006 by Prentice Hall
Internet Population in Selected Countries
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
Figure 16-5
TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS
Sources: CIA World Factbook
2003; Computer Industry
Almanac; and www.cia.gov,
accessed November 9, 2004
16.26 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS
• Cost of new interface designs
• Integrating new systems with old
• User interface design
• Differences in language and conventions
Software:
Unique challenges for application software:
16.27 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS
• Outsourcing portions of new systems like
development work or maintenance of existing
systems to external vendors in another
country
Offshore software outsourcing:
Managing Global Software DevelopmentManaging Global Software Development
16.28 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS
• Contract cost
• Vendor selection costs
• Transition management and knowledge transfer costs
• Domestic human resources costs
Major cost components of offshore software development:
16.29 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS
• Costs of improving software development processes
• Costs of adjusting to cultural differences
• Cost of managing an offshore contract
Major cost components of offshore software development:
(Continued)
16.30 © 2006 by Prentice Hall
Total Cost of Outsourcing
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS
Figure 16-6
16.31 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
MANAGEMENT OPPORTUNITIES, CHALLENGES, AND SOLUTIONS
Management Opportunities:
Ability to lower costs through global scale
economies by building international systems for
producing and selling goods and services in
different regions of the world
16.32 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
• Finding the right global business strategy
• Difficulties of managing change in a
multicultural firm
• Difficulties of achieving global connectivity
and integration
Management Challenges:
MANAGEMENT OPPORTUNITIES, CHALLENGES, AND SOLUTIONS
16.33 © 2006 by Prentice Hall
Management Information SystemsManagement Information Systems
Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
• Agreeing on common user requirements
• Introducing changes in business processes
• Coordinating applications development
• Coordinating software releases
• Encouraging local users to support global systems
Solution Guidelines:
MANAGEMENT OPPORTUNITIES, CHALLENGES, AND SOLUTIONS

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International mis

  • 1. 16.1 © 2006 by Prentice Hall 16Chapter Managing InternationalManaging International Information SystemsInformation Systems
  • 2. 16.2 © 2006 by Prentice Hall • Identify the major factors driving the internationalization of business • Compare strategies for developing global businesses • Demonstrate how information systems can support different global business strategies Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems OBJECTIVES
  • 3. 16.3 © 2006 by Prentice Hall • Evaluate the issues and technical alternatives to be considered when developing international information systems • Identify the challenges posed by global information systems and management solutions OBJECTIVES (Continued) Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems
  • 4. 16.4 © 2006 by Prentice Hall • Challenge: Fulfill customer orders made to a network of forty subsidiaries in Europe, Asia, and North America whose systems could not share data with one another • Solutions: develop a single corporate database and use middleware with standard interfaces to connect all the subsidiary’s systems • Develop a single worldwide data model with standard definitions and codes • Illustrates the role of systems in an international environment for reducing inventory and business process costs worldwide. Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems Drager Safety AG Case
  • 5. 16.5 © 2006 by Prentice Hall THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS Global Product Development and Production Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems Figure 16-1
  • 6. 16.6 © 2006 by Prentice Hall • The basic information systems required by organizations to coordinate worldwide trade and other activities Developing an International Information SystemsDeveloping an International Information Systems ArchitectureArchitecture International information systems architecture: Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS • A force in the environment to which businesses must respond and that influences the direction of the business Business driver:
  • 7. 16.7 © 2006 by Prentice Hall International Information Systems Architecture Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS Figure 16-2
  • 8. 16.8 © 2006 by Prentice Hall The Global Environment: Business Drivers and ChallengesThe Global Environment: Business Drivers and Challenges The global business drivers can be divided into two groups: Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS • Global communication and transportation technologies • Development of global culture General cultural factors: Table 16-1
  • 9. 16.9 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS • Emergence of global social norms • Political stability • Global knowledge base Table 16-1 (Continued) General Cultural Factors: (Continued)
  • 10. 16.10 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS • Global markets • Global production and operations • Global coordination • Global workforce • Global economies of scale Specific business factors: Table 16-1 (Continued)
  • 11. 16.11 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS Business Challenges • Cultural particularism: Regionalism, nationalism, language differences • Social expectations: Brand-name expectations, work hours • Political laws: Transborder data and privacy laws, commercial regulations General: Table 16-2
  • 12. 16.12 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems THE GROWTH OF INTERNATIONAL INFORMATION SYSTEMS • Standards: Different Electronic Data Interchange (EDI), telecommunications standards • Reliability: Phone networks not uniformly reliable • Speed: Different data transfer speeds, many slower than United States • Personnel: Shortages of skilled consultants Specific: Table 16-2 (Continued)
  • 13. 16.13 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems ORGANIZING INTERNATIONAL INFORMATION SYSTEMS Three kinds of organizational structure: • Centralized (in the home country) • Decentralized (to local foreign units) • Coordinated (all units participate as equals) Global Strategies and Business Organization
  • 14. 16.14 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems ORGANIZING INTERNATIONAL INFORMATION SYSTEMS • Heavy centralization of corporate activities in the home country of origin Domestic exporter strategy: • Centralized financial management and control while decentralizing production, sales, and marketing operations to units in other countries Multinational strategy:
  • 15. 16.15 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems ORGANIZING INTERNATIONAL INFORMATION SYSTEMS • The product is financed and initially produced in the home country, but for product-specific reasons rely on foreign personnel for further production, marketing, and human resources. Franchisers: • The value-adding activities are managed from a global perspective without reference to national borders, optimizing sources of supply and demand wherever they appear, and taking advantage of any local competitive advantages. Transnational strategy:
  • 16. 16.16 © 2006 by Prentice Hall Global Systems to Fit the StrategyGlobal Systems to Fit the Strategy Global Strategy and Systems Configurations Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems ORGANIZING INTERNATIONAL INFORMATION SYSTEMS Figure 16-3
  • 17. 16.17 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems 1. Centralized systems: Systems development and operation occur totally at the domestic home base. 2. Duplicated systems: Development occurs at the home base but operations are handed over to autonomous units in foreign locations. Four types of systems configuration: ORGANIZING INTERNATIONAL INFORMATION SYSTEMS
  • 18. 16.18 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems 3. Decentralized systems: Each foreign unit designs its own unique solutions and systems. 4. Networked systems: Systems development and operations occur in an integrated and coordinated fashion across all units. ORGANIZING INTERNATIONAL INFORMATION SYSTEMS Four types of systems configuration: (Continued)
  • 19. 16.19 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems ORGANIZING INTERNATIONAL INFORMATION SYSTEMS • Organize value-adding activities along lines of comparative advantage • Develop and operate systems units at each level of corporate activity —regional, national, and international • Establish at world headquarters Reorganizing the Business To develop a global company and information systems support structure:
  • 20. 16.20 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems MANAGING GLOBAL SYSTEMS • Agreeing on common user requirements • Introducing changes in business processes • Coordinating applications development • Coordinating software releases • Encouraging local users to support global systems Management Challenges in Developing Global Systems Table 16-4
  • 21. 16.21 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems MANAGING GLOBAL SYSTEMS • Define the core business processes: Conduct workflow analysis, identify centers of excellence for these processes • Identify the core systems to coordinate centrally: Conquer the core systems and define these systems as truly transnational • Choose an approach: Incremental, Grand Design, Evolutionary • Make the Benefits Clear Global Systems Strategy
  • 22. 16.22 © 2006 by Prentice Hall Local, Regional, and Global SystemsLocal, Regional, and Global Systems Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems MANAGING GLOBAL SYSTEMS Figure 16-4 Source: Adapted from Managing Information Technology in Multinational Corporations by Edard M. roche, copyright 1993.
  • 23. 16.23 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS Computing platforms and systems integration: • Develop global, distributed, and integrated systems to support digital business processes spanning national boundaries • Use of same hardware and operating system does not guarantee integration. • Establish data and technical standards Technology Challenges of Global Systems
  • 24. 16.24 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS • Overcoming disparate national technical standards, data exchange restrictions and service levels • User of Internet technology to create global intranets, extranets, virtual private networks (VPNs) Connectivity: Technology Challenges of Global Systems (Continued)
  • 25. 16.25 © 2006 by Prentice Hall Internet Population in Selected Countries Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems Figure 16-5 TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS Sources: CIA World Factbook 2003; Computer Industry Almanac; and www.cia.gov, accessed November 9, 2004
  • 26. 16.26 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS • Cost of new interface designs • Integrating new systems with old • User interface design • Differences in language and conventions Software: Unique challenges for application software:
  • 27. 16.27 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS • Outsourcing portions of new systems like development work or maintenance of existing systems to external vendors in another country Offshore software outsourcing: Managing Global Software DevelopmentManaging Global Software Development
  • 28. 16.28 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS • Contract cost • Vendor selection costs • Transition management and knowledge transfer costs • Domestic human resources costs Major cost components of offshore software development:
  • 29. 16.29 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS • Costs of improving software development processes • Costs of adjusting to cultural differences • Cost of managing an offshore contract Major cost components of offshore software development: (Continued)
  • 30. 16.30 © 2006 by Prentice Hall Total Cost of Outsourcing Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems TECHNOLOGY ISSUES AND OPPORTUNITIES FOR GLOBAL VALUE CHAINS Figure 16-6
  • 31. 16.31 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems MANAGEMENT OPPORTUNITIES, CHALLENGES, AND SOLUTIONS Management Opportunities: Ability to lower costs through global scale economies by building international systems for producing and selling goods and services in different regions of the world
  • 32. 16.32 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems • Finding the right global business strategy • Difficulties of managing change in a multicultural firm • Difficulties of achieving global connectivity and integration Management Challenges: MANAGEMENT OPPORTUNITIES, CHALLENGES, AND SOLUTIONS
  • 33. 16.33 © 2006 by Prentice Hall Management Information SystemsManagement Information Systems Chapter 16Chapter 16 Managing International Information SystemsManaging International Information Systems • Agreeing on common user requirements • Introducing changes in business processes • Coordinating applications development • Coordinating software releases • Encouraging local users to support global systems Solution Guidelines: MANAGEMENT OPPORTUNITIES, CHALLENGES, AND SOLUTIONS