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DIGITAL INNOVATION

AREA: INFORMATION SYSTEMS &


TECHNOLOGIES
Professor:

EXECUTIVE MBA

N OF SESSIONS: 14

EDUARDO MARIANO PEDREO BERNAL


E-Mail: epedreno@faculty.ie.edu

Eduardo Pedreo studied Law and Business Administration and holds an MBA from IE Business School.
He has developed his whole professional career in the IT and Internet world. From 1998 until 2005 he
directed DiarioRed, on of the first Spanish speaking digital media focused on technology and Internet
analysis. He started his career as a Technology Consultant for Weber Shandwick. In 2001 he was founder
and partner at Accesogroup, where for ten years he led the digitisation of the company's business model,
as well as the creation of IT products and services that were implemented in the leading Spanish
companies. He has directed technology implementation projects for major companies members of the
IBEX35. Since 2011 he is founder and partner at Glob3 Mobile, Inc., company focused on the creation of
products and services in the areas of visualisation and Geographical Information Services (GIS) for mobile
platforms and big data integration, with projects in diverse sectors such as the military, weather, civil
aviation, etc.

Published by IE Publishing Department.


Last revised, April 2016.

INTRODUCTION
Information technology (IT) have transformed the ways in which firms compete, and have become an
important factor in management decisions at all levels of the business. Moreover, our economy is
sometimes referred to as the "digital economy", which is indicative of the pervasive nature and the
critical role of IT in business strategies and operations. Technology has also changed the means by
which people communicate, collaborate, and coordinate work activities.
We will develop the set of knowledge and expertise about digital technologies that are required for
general managers (as opposed to IT specialists) who are responsible for the entire organization or
for assorted departments. This course has been designed for managers from a wide range of
organizational areas, levels and roles. It is not a course for persons to develop deep or narrow
expertise or specialty in any topical area of IT. We will examine IT for different purposes, including
how company can transform, innovate and get a competitive advantage with IT.
The course is divided in four main parts:
Fundamentals of Information Technology and Digital Innovation
This part introduces IT as a transforming force in today businesses. We will study the evolution
of IT and how this evolution has affected businesses, the strategic alignment between IT and
business goals; and how business can obtain competitive advantages with the use of
technology. Some key technologies such as Internet, search engines, and social media are
introduced in this module.
Digital Transformation of Business
This part gets deeper into digital transformation by studying new digital business models, and
their impact in businesses, from electronic commerce to the sharing economy.
Managing the Digital Transformation
This part focuses on the management of the digital transformation processes, including the
development, acquisition and implementation of IT, the investment decisions in relation to
technology as well as managing the change caused by the inclusion of technology. New risks
such as cybersecurity risks are also analysed.
Digital Innovation and Future Trends in IT
This final block examines the process of digital innovation, studying innovation models, open
innovation as well as emerging technologies and their impact on the business world.

OBJECTIVES
The course introduces students to the critical elements of designing and developing digital products
and services, equipping them to manage the digital transformation of a business, and to innovate in a
digital world.
The course has the following learning objectives:
To develop an appreciation of the importance of information technology in today businesses,
and to develop an appreciation for the issues surrounding the management of data/information
To identify and understand the economic and technological factors that are at the heart of the
digital revolution taking place in the economy.
To manage and lead product and service innovation initiatives in the digital space.
To understand and to apply concepts, tools and techniques to design appropriate digital
business models.
To strategically manage the digital transformation of a business.
To become familiar with emerging trends in IT, and to understand the implications of these
trends on people and organisations.

PROGRAM
SESSION 1 (FACE TO FACE)
INTRODUCTION ON IT AND ITS IMPACT ON BUSINESS AND SOCIETY
Introduction and objectives of the course.
What is IT and where does it fit in?
Brief history of IT.
Snapshots on how the new economy is shaping business and society.
P.C.: IT Doesn't Matter (R0305B-PDF-ENG)
R.A.: Integrating the Enterprise (SMR090-PDF-ENG)
SESSION 2 (FACE TO FACE)
DIGITAL TRANSFORMATION:
What is digital transformation (and why now?)
Digital Transformation examples
The disruptors: social media and social business, the collaborative economy and emerging
technologies
P.C.: Axel Springer in 2014: Strategic Leadership of the Digital Transformation (E522-PDF-ENG)
R.A.: Burberrys Digital Transformation. An interview with Angela Ahrendts, CEO of Burberry
(Capgemini Consulting)
R.A.: Digital Business Transformation. Where is your company on the Journey (IMD PFM187)
SESSION 3 (VIDEOCONFERENCE)
SOCIAL MEDIA REVOLUTION AND MULTI SIDED PLATFORMS
This session will be stuffed as we'll talk about both social media (and their impact for consumers and
enterprises) and we'll introduce the concept of Single and Multi Sided Platforms (and relative Network
Effects). The latter will also serve as a basis for sessions 14 (Nintendo) and 12 (Xensource).
P.C.: LinkedIn Corp., 2008 (709426-PDF-ENG)
P.C.: Building a Social Media Culture at Dell (514096-PDF-ENG)
P.C.: Multi-Sided Platforms: Foundations and Strategy (714436-PDF-ENG)
R.A.: The Cluetrain Manifesto (the 95 thesis)
P.C.: How Companies Become Platform Leaders (SMR268-PDF-ENG)
P.C.: Elements of Platform Leadership (SMR079-PDF-ENG)
P.C.: Shaping Strategy in a World of Constant Disruption (R0810E-PDF-ENG)
P.C.: The Year of Marketing Dangerously (F0810A-PDF-ENG)
SESSION 4 (FORUM)
STRATEGIC ALIGMENT OF IT
Strategic Alignment as a key to understand the challenges and opportunities of IT in the corporate
world.
P.C.: Zara: IT for Fast Fashion (604081-PDF-ENG)
P.C.: Six IT Decisions Your IT People Shouldn't Make (R0211F-PDF-ENG)

SESSION 5 (VIDEOCONFERENCE)
IT INVESTMENTS
Describes the efforts of Volkswagen of America, the U.S. subsidiary of Volkswagen AG, to arrive at
a process for setting IT funding priorities so that they align with business priorities and the company's
overall strategy. The process is carefully thought out and executed, but still encounters difficulties.
Demonstrates the details and difficulties of setting priorities for use of a scarce organizational
resource. Provides opportunities to critique the company's efforts and to propose alternative
approaches.
P.C.: Volkswagen of America: Managing IT Priorities (606003-PDF-ENG)
T.N.: Investing in the IT That Makes a Competitive Difference (Optional) (R0807J-PDF-ENG)
P.C.: Generating Premium Returns on Your IT Investments (SMR193-PDF-ENG)
P.C.: Building IT Infrastructure for Strategic Agility (SMR092-PDF-ENG)
SESSION 6 (FORUM)
CHOOSING THE RIGHT ERP
Describes Harley-Davidson's decision process for defining and selecting an enterprise-wide
procurement software package and the institutional changes introduced as part of this process. Tells
the story of Harley-Davidson's approach in developing integrated business processes and
information systems to meet the needs of a visionary procurement strategy. Central to this activity
was the evaluation and selection of an enterprise software package and implementation partner to
support the strategy. Describes managerial reasoning and tactics to introduce significant
organizational change into a setting where team-based responsibility and a culture of autonomy are
prominent.
P.C.: Harley-Davidson Motor Co.: Enterprise Software Selection (600006-PDF-ENG)
R.A.: A six-stage model of the buying process for ERP software (Industrial Marketing
Management)
SESSION 7 (VIDEOCONFERENCE)
CRM: NEEDED OR NOT?
Moore Medical is a medium-sized distributor of medical supplies to practitioners, such as podiatrists
and emergency medical technicians. At the time of the case, it has relied on traditional customer
channels such as catalogs, phones, and faxes to communicate product offerings, promotions, and
availability, and to take orders. It is now attempting to shift to a "bricks and clicks" distributor with a
strong Internet presence. It has already made substantial investments in an e-commerce Web site
and in "back office" ERP software to improve the fulfilment performance of its four distribution
centers. The ERP software has not lived up to expectations in all areas, and the company must
decide whether to invest in more modules for this system that might address its shortcomings. It must
also decide whether to make a significant additional investment in customer relationship management
software.
P.C.: Moore Medical Corp. (601142-PDF-ENG)
P.C.: CRM Done Right (R0411H-PDF-ENG)
SESSION 8 (FORUM)
CRITICAL ISSUES IN IT IMPLEMENTATION
Implementation activites, risks and options. The role of IT consultants and system integrators.
P.C.: SCM and ERP software implementation at Nike, from failure to success (ICMR 605-010-1)
P.C.: Cisco Systems, Inc.: Implementing ERP (699022-PDF-ENG)
T.N.: Ensuring ERP Implementation Success
4

R.A.: Supply Chain Management Definition and Solutions


SESSION 9 (VIDEOCONFERENCE)
DATA DRIVEN DECISION MAKING AND BIG DATA
The potential of data mining: extracting value from a bunch of seemingly useless data.
P.C.: Carnival Cruise Lines (806015-PDF-ENG)
T.N.: Diamonds in the Data Mine (R0305H-PDF-ENG)
P.C.: Innovating With Analytics (SMR433-PDF-ENG)
M.D.: Big Data (SI2-107-I-M)
SESSION 10 (FORUM)
IS SECURITY AND CRISIS MANAGEMENT
Threats to organizational IS.
Response strategy.
The rise of hactivism and its impact on your business.
M.D.: Sownage: Cyber security and business continuity (SI1-139-I-M)
R.A.: encryption is (mostly) not magic
R.A.: Lessons Learned. How Tumblr Recovered from a Business Crisis
R.A.: Google and Online Privacy (The Economist)
R.A.: Your Wall Has Ears (Wall Street Journal)
Video: Who are the hackers (watch at least the first TW O videos)
Video: EXTRA RESOURCE: Botnets
Video: EXTRA RESOURCE: Denial of Service attacks (DDOS)
Other: EXTRA RESOURCE: 20 things I learned about the browsers and the Web: Malware,
Phishing, and Security Risks
SESSION 11 (VIDEOCONFERENCE)
(OPEN) INNOVATION
What is innovation? How does it differ from invention? How can company benefit from participative
and open innovation models?
P.C.: TopCoder (A): Developing Software through Crowdsourcing (610032-PDF-ENG)
P.C.: Ambidextrous Organization (R0404D-PDF-ENG)
P.C.: New Business Logic of Open Innovation (S0307D-PDF-ENG)
Video: Clay Shirky: How cognitive surplus will change the world
R.A.: Foldit Users Solve Baffling Problem
R.A.: Trying to use prediction markets to forecast the presidential election
SESSION 12 (FORUM)
OPEN SOURCE, CLOUD COMPUTING AND VIRTUALIZATION
This session will touch three topics:
Open Source: what is it? Can companies leverage it and make money out of it?
Virtualization: what is it? How can it help control cost and manage IT infrastructure?
Cloud Computing: let's try to dissipate the cloud. Is it a fad? How can companies benefit from it?
Video: What is Open Source?
R.A.: Open Source models
5

R.A.: Geeks in Toyland (Wired Magazine)


P.C.: Open Source: Salvation or Suicide? (HBR Case Study and Commentary) (R0804A-PDFENG)
P.C.: XenSource (E267-PDF-ENG)
SESSION 13 (VIDEOCONFERENCE)
IT ENABLED SUSTAINABLE INNOVATION AND BOTTOM OF THE PYRAMID
Sustainable innovation and development as drivers of growth. How can companies leverage the
Bottom of the Pyramid using IT? Being good while making money.
P.C.: ITC in Rural India (909M36-PDF-ENG)
SESSION 14
DISRUPTIVE INNOVATION
Which are the characteristics of a disruptive innovation? An excuse to have a look at the video game
industry.
P.C.: Nintendo's Disruptive Strategy: Implications for the Video Game Industry (HKU814-PDFENG)
P.C.: Disruptive Technologies: Catching the Wave (Optional) (95103-PDF-ENG)
R.A.: Dont Innovate Alone HBR OnPoint Collection Article (ECCH 1049)
P.C.: The Big Shift: Measuring the Forces of Change (R0907Q-PDF-ENG)
P.C.: What's Your Google Strategy? (R0904F-PDF-ENG)

EVALUATION METHOD
Criteria
Class Participation
Individual work
Group Presentation
Participation on the "news from IT" forum

Score %
50%
20%
20%
10%

There will be one individual report and one group presentation. Details for both will be provided during
the first session of the course, along with other guidelines for the course.