Chapter 3 Effects of IT on Strategy and Competition

Chapter 4
Hardware and Software
- Case & Exercise
Jason C. H. Chen, Ph.D.
Professor of MIS
School of Business
Gonzaga University
Spokane, WA 99258 USA
[email protected]
Dr. Chen, Management Information Systems
In-class exercise
UYK (p.135)
• 1. Suppose that your roommate, a political
science major, asks you to help her
purchase a new laptop computer. She wants
to use the computer for email, Internet
access, and for note-taking in class. She
wants to spend less than $1,000.
Dr. Chen, Management Information Systems
• a) What CPU, memory, and disk specification do you
• I suggest a lower-end Pentium dual core CPU with a
speed around 1.5 GHz; 2 GB of RAM, and an 80 GB
hard drive.
• b) What software does she need?
• An operating system (Windows 7 Home Premium), a
Web browser (Internet Explorer or Firefox), email,
such as Outlook or Thunderbird, and a word
processor such as Word or a note-taking product such
as One Note.
Dr. Chen, Management Information Systems
• c) Shop Dell, HP, and Lenovo for the best computer
• Dell offers an Inspiron 1520 at $893. HP offers a
Presario C700T for $645 (but this option is limited to
a maximum 1 GB of RAM). Lenovo offers a
ThinkPad R61i for $904.
• d) Which computer would you recommend, and why?
• I recommend either the Dell or the ThinkPad.
Currently, there is a delay of 3–4 weeks for the
ThinkPad, whereas the Dell is available, so I would
lean toward the Dell.
Dr. Chen, Management Information Systems
Case Study 4: The Apple of Your i
(p.137-139) ALL GROUPS
• Tripled its market in three years
• Second largest public company in world
• Apple pioneered well-engineered home
computers and innovative interfaces for
students and knowledge workers.
• Every sales success feeds other sales
Dr. Chen, Management Information Systems
1. Which of Porter’s four competitive strategies does
Apple have? Explain your answer.
• Apple is pursuing a focused differentiation
• It is focused primarily on the mobile computing
device market and is differentiating itself through its
incredible engineering and huge array of
applications for its devices.
Dr. Chen, Management Information Systems
Porter’s Four Competitive Strategies
Fig 3-4: Porter’s Four Competitive Strategies
To be effective, organization goals, objectives, culture, and activities must
Dr. Chen,
Systems organization strategy.
2. What do you think are the three most important
factors in Apple’s incredible success? Justify your
• Apple has demonstrated a capability of creating
innovative new products successfully. Apple has
also been able to keep that stream of innovations
going and to enable the innovations to play off of
each other.
• A culture that encourages and supports these
engineering successes is obvious. Apple also has
developed an ability to sell and market its new
products successfully.
Dr. Chen, Management Information Systems
3. Steve Jobs passed away in the Fall of 2011. Until his death, he
had been the heart and soul of Apple’s innovation. Today, 35,000
Apple employees continue onward in his absence. A huge question
to many investors is whether the company can be successful without
him. What is your opinion? What role did he play? How can Apple
respond to his loss? Would you be willing to invest in Apple
without his leadership? Why or why not?
• Jobs had a very hands-on involvement in the business. He
was the company’s chief innovator. Of course he didn’t do
it all alone, but he seemed to set the direction for the
business in a very effective way.
• He had the ability to be visionary and send his company’s
engineers out to conquer challenges that paid off in big
ways. The company then also had the ability to develop
support systems for the new innovations.
Dr. Chen, Management Information Systems
3. (cont.)
• Another capability was to recover and move on from
product failures, which Apple had its share of as well.
Can this company continue its progress without Jobs?
Obviously, only time will tell. Some students may feel
that Apple will be unable to sustain its success without
the unique vision and leadership style of Jobs and
would therefore be unwilling to invest in Apple.
• Other students may feel that Apple’s executives have
been hand-picked and mentored by Jobs and are
therefore capable of continuing to lead Apple
effectively. There is no question that Apple will be a
different place without Jobs’ influence, but it is not
necessarily doomed.
Dr. Chen, Management Information Systems
4. Microsoft took an early lead in the development of slate devices (like the
iPad), and it had the world’s leading operating system and applications
for over 20 years. Provide five reasons why Microsoft was not able to
achieve the same success that Apple has. Most industry analyst would
agree that the skills and abilities of Microsoft’s 88,000 employees are as
good, on average, as Apple’s..
• Here is a list of a few ideas to get the discussion rolling:
 Lack of a visionary leader since Gates has departed.
 Very diffuse focus – many market niches pursued simultaneously.
 Emphasis on acquiring new technologies rather than in-house
 Strategy of maintaining edge through strategic manipulation rather
than product enhancement
 Few products that are truly amazing, must-have products
Dr. Chen, Management Information Systems
5. Considering your answers to the four questions above, if you
had a spare $5,000 in your portfolio and wanted to buy an
equity stock with it, would you buy AAPL (Apple)? Why or why
• Students will have different opinions on this. I would be
sure to ask those who want to jump on board the Apple
bandwagon several questions, including:
 Is it the best strategy to buy a stock with the price at
record highs?
 Are you concerned about the loss of Steve Jobs?
 How do you feel about the company’s ability to keep
producing technical winners?
Dr. Chen, Management Information Systems

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