TDB lecture notes
LECTURE 1: DIGITAL STRATEGY 1/SETTING THE STAGE
Importance of ICT and digital transformations
- New capabilities, new opportunities in just a decade
- Changes in the pace of change
- The troubadours of today have changed as well
- Innovations are spreading much faster, people are overwhelmed à a lot of people have
difficulties dealing with the information overload
Changes in 3 areas
1. In technology
o More power, more data
o Exponential growth
o Big data
2. The world of software
o You can be an architect and a builder at the same time
o Everything can be quicker
o IT is about business architecture
o Focus on what, not how
o Modular design = you connect things with one another à flexibility and speed is
king
o If you’re not faster, you only compete on price; if you’re faster, you are different
3. Changes in strategy & organization
o Economies of speed, scope and scale
o Speed = cycle time reduction
o Disappearing boundaries
à within firm: no more silos, globalization
à between companies: supply chain
ICT and Business/ Industry Redefinition
1. Localized exploitation
2. Internal integration
3. Business process redesign
4. Business network
1) the importance of ICT and digital business
- fundamental changes in how we work, compete, collaborate, communicate, socialize,
play, learn
- information management dominates and cuts across all disciplines
- crucial dependence on ICT for individuals, business, governments
- ICT key course for innovation
2) digital business: trends and issues
- Cybersecurity, privacy
- Alignment if IT with the business
- Data analytics
- Digital transformation
Bol.com
- Adblockers are a thread to the digital advertising ecosystem
- The main issues concerning adblockers:
1
, 1. Loss in revenue (20% of total revenue)
2. Loss of data (to monitor and optimize customer journey)
3. Manipulation of A/B tests (comparing consumers)
READINGS 1
Chapter 1
- In the previous decade, tech firms have created profound shifts in the way firms advertise
and individuals and organizations communicate
- New technologies have fuelled globalization, redefined our concepts of software and
computing, crushed costs, fuelled data-driven decision-making, and raised privacy
and security concerns
- The ranks of technology revolutionaries are filled with young people, with several leading
firms and innovations launched by entrepreneurs who started while roughly the age of the
average university student
- Several forces are accelerating and lowering the cost of entrepreneurship: crowdfunding,
cloud computing, app stores, 3D printing, and social media
- As technology becomes cheaper and more powerful, it pervades more industries and
is becoming increasingly baked into what were once non-tech functional areas
- Technology is impacting every major business discipline, including finance, accounting,
marketing, operations, human resources, and the law
- Tech jobs rank among the best and highest-growth positions, and tech firms rank among
the best and highest-paying firms to work for
- Information systems (IS) jobs are profoundly diverse, ranging from those that require
heavy programming skills to those that are focused on design, process, project
management, privacy, and strategy
2
,LECTURE 2: DIGITAL STRATEGY 1/USING DIGITAL TECHNOLOGIES FOR
STRATEGIC ADVANTAGE
- How can you use strategy and IT to gain market advantage?
- Legacy systems = no longer useful, they were once best-of-breed but now are used in a
negative sense
IT and Digital strategy
- IT isn’t developed in a vacuum
- IT can fuel disruptions
- IT is the source of disruptive innovations à organizations start doing things differently,
organizations come with new value propositions
- New value creation paths affect structural organizational changes
- Digital transformation à start with IT development and end with an impact
Hypes and trends: surfing the waves
- Many It innovations follow the hype-cycle, where after introduction expectations quickly
become unrealistically high
- Once ppl realize that, the expectations (perceived value) changes from hype to disillusion
- Real developments typically different from hype and disillusion and it is important for
managers to understand both perceived and real importance
- New IT is seen as something that will revolutionize the world
- The hype is typical of IT à sometimes a bit too early or too much
- “the hype curve” à by Gartner
- The disillusion is also exaggerated
Gartner’s Hype cycle (emerging technologies)
- AI is high on the hype cycle
3
, - Innovation trigger à peak of inflated expectations à trough of disillusionment à slope
of enlightenment à plateau of productivity
- Hypes are constant
- Gartner does commercial market research
DIGITAL STRATEGY
- IT fuels the disappearance of boundaries and creates new open playing fields, transforms
industries, companies, supply chains, and the way we work, communicate and socialize
- Different IT strategy alignment frameworks can help companies assess challenges and
opportunities
- You need to understand how to look at IT innovations in their context from different
perspectives and understand how you can identify ways to link and align strategy with IT
- IT can influence your strategy; your strategy can be supported by IT
1. Value propositions and business models
- Simple model à we have one or more customer segments which are experiencing certain
pains for which we are offering a product or service that relieves them or brings additional
gains
- It doesn't have to be revolutionary; just done slightly differently
- Look at the customer profile carefully
- Value proposition walkthrough:
1. Today, when [customer profile 0] want to [customer job 1]..
2. They experience [pain 2]
3. For this we will offer [product & services 3]
4. That will bring gains [4]
5. And relieve [pains 2] through [pain relivers 5]
6. And bring [gains 4] through [gain creators 6]
- Value propositions increasingly rely on digital capabilities to create gain and relieve pain
to help customers get a job done
- A wider business model canvas à accounts for key partners, key activities, key
resources, value propositions, customer relationships, channels (online/offline), customer
segments, cost structure, revenue streams
= a perpetuating model that brings in revenue
= in order to fulfil the value propositions, we need key activities, key resources and key
partners à together they bring costs à as long as those are lower than the revenues, we
have a sustainable business model
- Business model levers à focusing more on IT or more on digital channels rather than
personal etc
2. Disappearing boundaries
- IT can fuel the disappearance of boundaries within the organization and between the
organization and its ecosystem
- The idea that if we want to do things fast, we should not have boundaries between the
various parts of the organization
- If you have no boundaries, you can be faster à the left hand knows what the right hand is
doing
- If you have no boundaries, you can be agile and change things more quickly
- IT used to be used to make local processes more efficient (e.g. in manufacturing, in
accounting, in production, in marketing) = organizations used to look for “best-of-breed”
applications, where the best system for a specific isolated function within a single
department was built and used
4
LECTURE 1: DIGITAL STRATEGY 1/SETTING THE STAGE
Importance of ICT and digital transformations
- New capabilities, new opportunities in just a decade
- Changes in the pace of change
- The troubadours of today have changed as well
- Innovations are spreading much faster, people are overwhelmed à a lot of people have
difficulties dealing with the information overload
Changes in 3 areas
1. In technology
o More power, more data
o Exponential growth
o Big data
2. The world of software
o You can be an architect and a builder at the same time
o Everything can be quicker
o IT is about business architecture
o Focus on what, not how
o Modular design = you connect things with one another à flexibility and speed is
king
o If you’re not faster, you only compete on price; if you’re faster, you are different
3. Changes in strategy & organization
o Economies of speed, scope and scale
o Speed = cycle time reduction
o Disappearing boundaries
à within firm: no more silos, globalization
à between companies: supply chain
ICT and Business/ Industry Redefinition
1. Localized exploitation
2. Internal integration
3. Business process redesign
4. Business network
1) the importance of ICT and digital business
- fundamental changes in how we work, compete, collaborate, communicate, socialize,
play, learn
- information management dominates and cuts across all disciplines
- crucial dependence on ICT for individuals, business, governments
- ICT key course for innovation
2) digital business: trends and issues
- Cybersecurity, privacy
- Alignment if IT with the business
- Data analytics
- Digital transformation
Bol.com
- Adblockers are a thread to the digital advertising ecosystem
- The main issues concerning adblockers:
1
, 1. Loss in revenue (20% of total revenue)
2. Loss of data (to monitor and optimize customer journey)
3. Manipulation of A/B tests (comparing consumers)
READINGS 1
Chapter 1
- In the previous decade, tech firms have created profound shifts in the way firms advertise
and individuals and organizations communicate
- New technologies have fuelled globalization, redefined our concepts of software and
computing, crushed costs, fuelled data-driven decision-making, and raised privacy
and security concerns
- The ranks of technology revolutionaries are filled with young people, with several leading
firms and innovations launched by entrepreneurs who started while roughly the age of the
average university student
- Several forces are accelerating and lowering the cost of entrepreneurship: crowdfunding,
cloud computing, app stores, 3D printing, and social media
- As technology becomes cheaper and more powerful, it pervades more industries and
is becoming increasingly baked into what were once non-tech functional areas
- Technology is impacting every major business discipline, including finance, accounting,
marketing, operations, human resources, and the law
- Tech jobs rank among the best and highest-growth positions, and tech firms rank among
the best and highest-paying firms to work for
- Information systems (IS) jobs are profoundly diverse, ranging from those that require
heavy programming skills to those that are focused on design, process, project
management, privacy, and strategy
2
,LECTURE 2: DIGITAL STRATEGY 1/USING DIGITAL TECHNOLOGIES FOR
STRATEGIC ADVANTAGE
- How can you use strategy and IT to gain market advantage?
- Legacy systems = no longer useful, they were once best-of-breed but now are used in a
negative sense
IT and Digital strategy
- IT isn’t developed in a vacuum
- IT can fuel disruptions
- IT is the source of disruptive innovations à organizations start doing things differently,
organizations come with new value propositions
- New value creation paths affect structural organizational changes
- Digital transformation à start with IT development and end with an impact
Hypes and trends: surfing the waves
- Many It innovations follow the hype-cycle, where after introduction expectations quickly
become unrealistically high
- Once ppl realize that, the expectations (perceived value) changes from hype to disillusion
- Real developments typically different from hype and disillusion and it is important for
managers to understand both perceived and real importance
- New IT is seen as something that will revolutionize the world
- The hype is typical of IT à sometimes a bit too early or too much
- “the hype curve” à by Gartner
- The disillusion is also exaggerated
Gartner’s Hype cycle (emerging technologies)
- AI is high on the hype cycle
3
, - Innovation trigger à peak of inflated expectations à trough of disillusionment à slope
of enlightenment à plateau of productivity
- Hypes are constant
- Gartner does commercial market research
DIGITAL STRATEGY
- IT fuels the disappearance of boundaries and creates new open playing fields, transforms
industries, companies, supply chains, and the way we work, communicate and socialize
- Different IT strategy alignment frameworks can help companies assess challenges and
opportunities
- You need to understand how to look at IT innovations in their context from different
perspectives and understand how you can identify ways to link and align strategy with IT
- IT can influence your strategy; your strategy can be supported by IT
1. Value propositions and business models
- Simple model à we have one or more customer segments which are experiencing certain
pains for which we are offering a product or service that relieves them or brings additional
gains
- It doesn't have to be revolutionary; just done slightly differently
- Look at the customer profile carefully
- Value proposition walkthrough:
1. Today, when [customer profile 0] want to [customer job 1]..
2. They experience [pain 2]
3. For this we will offer [product & services 3]
4. That will bring gains [4]
5. And relieve [pains 2] through [pain relivers 5]
6. And bring [gains 4] through [gain creators 6]
- Value propositions increasingly rely on digital capabilities to create gain and relieve pain
to help customers get a job done
- A wider business model canvas à accounts for key partners, key activities, key
resources, value propositions, customer relationships, channels (online/offline), customer
segments, cost structure, revenue streams
= a perpetuating model that brings in revenue
= in order to fulfil the value propositions, we need key activities, key resources and key
partners à together they bring costs à as long as those are lower than the revenues, we
have a sustainable business model
- Business model levers à focusing more on IT or more on digital channels rather than
personal etc
2. Disappearing boundaries
- IT can fuel the disappearance of boundaries within the organization and between the
organization and its ecosystem
- The idea that if we want to do things fast, we should not have boundaries between the
various parts of the organization
- If you have no boundaries, you can be faster à the left hand knows what the right hand is
doing
- If you have no boundaries, you can be agile and change things more quickly
- IT used to be used to make local processes more efficient (e.g. in manufacturing, in
accounting, in production, in marketing) = organizations used to look for “best-of-breed”
applications, where the best system for a specific isolated function within a single
department was built and used
4
