Smart Business Networks

CSE & Enterprise Systems Center,Lehigh University

1

Roger N. Nagel © 2005& Smart Business Networks

Smart Business Networks

Enable Strategic Opportunities Not Found In

Traditional Business Networks

Professor Roger NagelSenior Fellow for Creative programs

Enterprise Systems CenterLehigh University

Bethlehem, Pennsylvania


2


Technology And Business Strategy Have A Mutual Impact On One Another

Technology inspires strategyTransparencyVirtual organizationReverse auction

Strategy inspires technologyERP,SCM,CRME-commerceE-meetingsE markets


3



Networks will be competitorsBrand will be attached to the nodeThe node is a network & vice versa

AIRBUS is a node (OEM) within asupply chain as well as a network of subordinate entitiesEbenezer & Fairview Health System


4



Based on Understanding the fundamental principles which motivate customers, suppliers

Allows management to see and create new value propositions

Using information integrationTo enhance and redefine the value of communication and relationships in business


5



We believe that information integrates humans and machines in networks

Enabling them to collaborate and to function in a way that empowers the creation of value and the achievement of goals


6


Smart Business NetworksNot just an opportunity

CiscoDell

Sometimes a necessityXerox

Print & distributeDistribute & print

o Required an SBN» Apple, IBM, ATT, Adobe, Kinko's, E&Y, …


7


Xerox Understood Implicitly The Need To Form A Smart Business Network

To reinvent the way business is done The company had realized that the market of the future could not be served by its traditional business network

Because it was lacking key partners in the areas of network communications, informationintegration and cooperation across traditional business lines

Xerox thus transformed itself into a network business operating as a node in a smart business network.


8


Business Networks

In the future, business networksinstead of individual business organizations will be the competitors

Product Vs. Product

Supply Chain Vs. Supply Chain

Process Vs. Process

Source UPS


9



Those networks need to: Look smart through the goods, products, services and experiences they provide and Be smart in terms of how the individual members coordinate, collaborate, innovate and organize themselves


10


Information The Enabler For An SBN

Information is a necessary, but not sufficient qualifier of a smart business network,

The simple existence of information in a business network does not render it any “smarter”The key factor is how information is used, or, integrated into the business networkThe concept of information integration is therefore central to understanding smart business networks


11


information integrationInformation integrates humans and machines in networks

We introduce a classification system that we define as levels of information integration


12


6 Levels of Information Integration for

Even the simplest integration, which allows for information access,

Creates new strategic advantage, by offering “convenience” to clients who find it valuable

At each of the six levels we define several value based factors similar to convenience

Provide a brief example of a company that used the value proposition to redefine or significantly change the way business is done in its industry


13


6 Levels of Information IntegrationThe first three levels1. Access, 2. Transaction 3. Digitization These levels are about what a business network can do to be perceived as smart

The network appears smart to the outside, because it assimilates and integrates information To create value through innovative products, services, solutions and experiences


14


Create Value => Innovative Products, Services, Solutions And Experiences

In this context, the business network itself is a node that is part of a larger network, namely its marketplace.

1stTier

2ndTier

PrimeN thTier

EmployeesHow

many?

….. Tier

Consumers6 Billion?

Companies

eHub

TX

FL, MX, PN

SJ, MX

SCISCITeradyneTeradyne

SaleslinkSaleslink

FoxconnFoxconn

VentureVenture

AlteraAltera

AscomAscom

BroadcomBroadcomCypressCypress

Delta Delta HoneywellHoneywell JDSU JDSU

IBM IBM InfineonInfineon

MerixMerixOCP OCP

CHINA

CISCO

Node i

n a ne

twor

k

Network in a node

Recursively EmbeddedNetwork Charisma

Node Charisma


15


Level Value Proposition Enabled Simple Example

Transaction

Access

Digitization

AmazonFedExGoogle

Dell, CiscoCovisint, EBAYEZPass

ITunesE-Stamps, KinkosWebEX, N-GageAirline check in

ConvenienceTransparencyIntroduction & Referral

CustomizationFacilitate marketTransaction Convenience

Digital delivery“Distribute and Print”Facilitate InteractivityProvide self sufficiency

SBN appears smart to the outside, because it creates value through innovative products, services, solutions and experiences


16


Value in ConvenienceSavings: Information that saves you resources –a combination of time, money, or effort.Empowering: Information arms you to do something you could not have done easily or at all.Fewer steps: One or a few interactions provide the information you need rapidly.Mistakes: Prevents you from making an uninformed or bad decision.Self Service: Reduce your reliance on others people, organizations or processes.Full Service Solution: Details are handled for you in your context creating a solution.Knowledge: Information arms you with the ability to enhance decisions and their value. Trust : Information provides peace of mind


17


Value in TransparencyTrust: Customers and suppliers looking into your system believe and therefore trust the information you provide them.Trust Empowers: Relationships are based on trust and with trust care enhancedFewer steps: Transparency allows for the automation of interaction and elimination of time wasting and awkward human coordination to share informationMistakes: Prevents you from making mistakes when information is reentered from one system into an other.Knowledge: Transparent access to information arms you with the ability to make informed and timely decisions which can increase value.


18


Value in Introduction or ReferralFinding Customers: Organizations save time, resources and are willing to pay for the ability to get interested customers.

Google gets paid by the sire they refer you to based on an auctionFewer steps: Referral speeds the process of finding resources and is of valueMistakes: Getting to a verified correct source can avoid making errors or using bad informationKnowledge: Sharing expertise is providing a consulting service, referrals create value through this mechanism


19


TransactionInformation is used to set a context for defining and executing a transaction

Dell redefined the way business is done in its industry by using an SBN to offer customers “customized products”eBay uses virtual transaction space to facilitate network markets“Transaction convenience” in transportation networks is provided to clients through E-ZPass (windshield based transponder) at toll booths


20


The process of using The process of using information technology to information technology to replace, enhance or replace, enhance or substitute for physical substitute for physical processes, resources and processes, resources and delivery systemsdelivery systems

Digitization


21


Digitization Impact

•Players Card•Money Reader•Payment Slip


22


Digitization

Can redefine an industry or distribution mechanism

Digital delivery –Apple ITunesDistribute & print – E-StampsFacilitate interactivity – N-GageProvide self sufficiency

Airline o Book, buy, select seat, check in


23


Digitization: Self-SufficiencyWe can provide for self-sufficiency by enabling people to do on their own what used to require trained professionals.

Consider for example Making travel reservations Printing and sharing photographs Editing movies, etc


24


DigitizationThe topic of digitization is an incredibly important emerging phenomenon.

The creation of strategic value, The reinvention of the way business is done,The shift of power from traditional business networks to SBN’s using digitization

Is only just beginning


25


6 Levels of Information IntegrationThe second three levels4. Virtual Organization, 5. Collaboration Network6. Innovation Network

These levels are about what a business network can to do to act smart in the way its partners

coordinate collaborateinnovate organize themselves

.


26


Common Goals Partner Collaboration Innovation

This is achieved through the integration of information with the people, cultural and organizational issues that could otherwise prevent the network from being smart.

The transition from one level to the next requires a major paradigm shift that should not be taken for granted.

Virtual Organization

Collaboration Network

Innovation Network

Phase Transition

Phase Transition

Source Cisco


27


A dynamic set of companiesThat come together for a time based and opportunity driven goalRelationships vary from formal to informal,They need to practice working together to learn to communicate, share information, and IP etc.Moderate interaction

Limited scope of activities Limited collaborationMany fail over trust issues



28


Committee or Team?

So we agree on new lighting as the solution!


29


Learning environmentsharing resources to create value

Value circle

Multiple Virtual Organizations


30


FinancingFinancingProduct R & DProduct R & DDNPS

MarketingMarketing

Supply Supply ChainChain

CustomerCustomerRelationshipRelationship

CollaborationCollaborationNetworkNetwork

ManufacturingManufacturing

A set of companies who share a short and long term roadmap or vision and focus significant resources on value producing Intensive interaction

Committed and involved in the goals and success of all collaboratorsExtensive Information Sharing Integrated Infrastructure facilitates both people and information networking

CollaborationNetwork


31



32


A Web that evolves to build and deliver value through products & services, solutions & experiences or creates & manages networks of suppliers

A network of partners in innovative seamless relationships Agile and use a variety of infrastructures to optimize for each client

InnovationNetwork


33


Level Value Proposition Enabled Simple Example

CollaborationNetwork


Innovation Network

Rosetta NetOne WorldHoliday Inn, Hertz

DuPontCiscoVisa, Master Card

Li & FongAgile Web of PAAcheron’s Call

StandardsGlobal Alliance Franchise

Collaboration HubNode & Network CharismaSwarm Effect

Network EconomyDynamic TeamsVirtual Reality

Act smart in terms of how the individual members coordinate, collaborate, innovate and organize themselves


34


Look Smart Self Sufficiency & Enriched Relationships

Look Smart Convenience & Trust

Virtual Organization Innovation Network

Info Access Transactions

Digitization

Project data

Collaboration Network

Source: PRTM

Six Levels of Information Integration for Business Competitiveness

Be Smart Partner Collaboration Innovation


35


Virtual Organization Characteristics

Opportunity-driven, information enabledWiden capability --one stop shoppingReduce concept to cash cycle timeReduce design conceptualization timeCooperating to increase competitivenessInside the companies in teams and task forcesOutside the organization in “webs” of suppliers and customers


36


Collaboration Network Characteristics

Seamless and borderless integration of resources without organizational lines

Virtual vertical integration organized Dynamic organizational structureInter-enterprise business/production systems

Intensive, interactive, collaboration within and among companiesGreater value potential than the sum of the collaborators value producing capabilities


37


Collaboratory Success FactorsShared visionImplicit versus Explicit

Outcomes each player needs

Values & EthicsEthical agreement

Trust criticalityTime it takesShort cuts

Agreed upon explicit R3A

RiskRewardResponsibilityAccountability

Intellectual property agreementsQuality understanding


38


Network Business Transformation: Driving Forces

Network CompetitorsEmerging

Agility & MassCustomization

ComplexityOf Products

Dynamic Nature of Customer Challenges

Need to manage complexity(Simple interfaces on

complex products)Networks of Modules

Opportunity for Information Based

Collaboration

Opportunity to create value in innovative ways

Innovation as a Competitive Differentiator

In Value Creation

Pull by Customers forSolutions & Experiences

Opportunity Derived from The Emerging Understanding

of Networks


39


Conclusion Regarding SBN

We live in an increasingly digitized and networked world, and the old ways of doing business need to be re-examined in light of smart business networks. We have presented information integration as central to such networks, and discussed six levels of information integrationThe purpose of this presentation is to stimulate the thinking and imagination of the reader.


40


Thank YouRoger N. Nagel

Wagner Professor and Senior Fellow CSE Department &

The Enterprise Systems Center at Lehigh University 200 West Packer Avenue

Bethlehem, Pennsylvania, 18015(610) 758-4086, (610) 868-0402 [fax]

[email protected]

Date post:	15-Dec-2014
Category:	Documents
Upload:	alistercrowe
View:	699 times
Download:	0 times

Smart Business Networks

Documents