Strategic Alignment Process and Decision Support Systems: Theory and Case Studies

385 Pages·2006·4.95 MB·English

by  Tamio Shimizu

i
Strategic Alignment
Process and Decision
Support Systems:
Theory and Case Studies
Tamio Shimizu
University of São Paulo, Brazil
Marly Monteiro de Carvalho
University of São Paulo, Brazil
Fernando Jose Barbin Laurindo
University of São Paulo, Brazil
IRM Press
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information technology titles in the cyberage
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ii
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Library of Congress Cataloging-in-Publication Data
Shimizu, Tamio, 1938-
Strategic alignment process and decision support systems : theory and case studies / Tamio Shimizu,
Marly Monteiro de Carvalho and Fernando Jose Barbin Laurindo.
p. cm.
Summary: "This book deals with strategic organizational decision-making providing techniques for
improving the intelligence of actions by organizational decision-makers"--Provided by publisher.
Includes bibliographical references and index.
ISBN 1-59140-976-4 (hardcover) -- ISBN 1-59140-977-2 (softcover) -- ISBN 1-59140-978-0
(ebook)
1. Strategic planning. 2. Decision making. 3. Management information systems. I. Carvalho, Marly
Monteiro de, 1965- II. Laurindo, Fernando José Barbin. III. Title.
HD30.28.S4323 2006
658.4'012--dc22
2005023878
British Cataloguing in Publication Data
A Cataloguing in Publication record for this book is available from the British Library.
All work contributed to this book is new, previously-unpublished material. Each chapter is assigned to at
least 2-3 expert reviewers and is subject to a blind, peer review by these reviewers. The views expressed
in this book are those of the authors, but not necessarily of the publisher.
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Dedication
The authors dedicate this book to:
To our parents, Fuminobu, Sotoe, Maria do Carmo, Lenny, and Sylvio
(allin memoriam) and Mauro for their example and dedication.
To the wives and husband, Sumie, Margarida, and João Alexandre, and
daughter and sons, Alice Maria, Luiz Fernando, Lucas and Diogo, sources
of inspiration, who fulfill our lives with motivation and joy.
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Strategic Alignment
Process and Decision
Support Systems:
Theory and Case Studies
Table of Contents
Preface................................................................................................x
Chapter I.
Concepts And History Of Strategy In Organizations ..........................1
The Rise of Strategic Thinking...........................................................1
Investigating the Concept of Strategy.................................................5
The Alignment of Forces to Build a Good Strategy. Can a Good
Strategy Be Replicated or is There a Formula for a Good Strategy?. 16
Characteristics and Elements of Competitive Strategy .......................20
Case Studies: Strategy and Decisions in Perspective .........................22
Questions for Reflection and Discussion...........................................28
References .................................................................................... 29
Chapter II.
Developing Strategies For Competitive Advantage.......................... 32
Understanding the Competitive Environment..................................... 32
Industry Analysis............................................................................ 33
Taking a Look Inside the Industry....................................................39
Internal Analysis of the Company to Adequate Positioning ................ 45
Case Study: Strategy and Decisions in Perspective...........................53
Questions for Discussion and Reflection...........................................53
References .................................................................................... 59
Chapter III.
An Overview Of Value Chains, Supply Chains And Strategic
Alliances Issues ................................................................................ 61
Introduction................................................................................... 61
How to Define the Term Chains ...................................................... 62
Location: The Role of Clusters in Competitiveness............................ 68
Decision-Making Tool Applied to Environment Analysis.................... 74
Case Study: Strategy and Decisions in Perspective............................ 76
Questions for Discussion and Reflection...........................................78
References .................................................................................... 78
Chapter IV.
Aligning Strategy With Organizational Structures And Project
Deployment....................................................................................... 82
Introduction................................................................................... 82
The Project Concept...................................................................... 83
Organizational Structures and the Project.........................................84
Maturity Models............................................................................91
Case Study: Strategy and Decisions in Perspective............................ 98
Questions for Discussion and Reflection......................................... 101
References .................................................................................. 102
Chapter V.
Alignment Of Organizational Strategy With Information Technology
Strategy........................................................................................... 106
Introduction................................................................................. 106
Conceptualizing Information Technology ........................................ 108
The (cid:179)Productivity Paradox(cid:180) .......................................................... 108
The Efficiency and Effectiveness of Information Technology
Applications............................................................................ 110
Critical Success Factors (CSF)......................................................111
The Strategic Role of IT Applications............................................. 113
Strategic Alignment....................................................................... 117
Routes to a Strategic Role for IT................................................... 122
Case Studies: Strategy and Decisions in Perspective ...................... 130
Questions for Reflection and Discussion......................................... 134
References .................................................................................. 136
Chapter VI.
Performance Measurement Systems.............................................. 140
Introduction................................................................................. 140
Building a Rapid Strategic Process ................................................ 140
Strategic Performance Measurement and Monitoring ...................... 143
Implementing the BSC.................................................................. 149
Case Study: Strategy and Decisions in Perspective......................... 153
Questions for Discussion and Reflection......................................... 155
References .................................................................................. 156
Chapter VII.
Strategies For The New Economy And Dynamic Competitive
Environment.................................................................................... 158
Introduction................................................................................. 158
Seeking to Understand the New Economy..................................... 159
The Electronic Markets ................................................................ 161
The Internet as a New Strategic Agent........................................... 163
The Appearance of Virtual Organizations ....................................... 165
Virtual Chains of Production.......................................................... 168
Revolution or Evolution: That is the Question.................................. 175
Final Considerations and Perspectives ........................................... 180
Case Studies: Strategy and Decisions in Perspective ....................... 181
Questions for Reflection and Discussion......................................... 185
References .................................................................................. 186
Chapter VIII.
An Overview Of The Decision-Making Process In Organizations . 189
Introduction: Situations and Facts that Affect Organizations............. 189
Rational Concepts Adopted.......................................................... 196
Classification of Decision-Making Situations................................... 198
Example: Selection of Used Cars................................................... 204
How Decision-Making Process is Analyzed in the Literature............ 206
Conclusions................................................................................. 207
Case Studies: Strategy and Decisions in Perspective ...................... 208
Questions for Reflection and Discussion......................................... 209
Exercises..................................................................................... 210
References .................................................................................. 211
Chapter IX.
The Structuring Of The Strategic-Decision-Making Process ......... 213
Introduction: A Systematic Procedure for Structuring the
Decision-Making Process........................................................ 213
Building the Model....................................................................... 215
Basic Structures of Decisions Problems ......................................... 219
Additional Problems That Must Be Considered in Structuring a
Strategic-Decision-Model........................................................ 232
Conclusions................................................................................. 235
Case Studies: Strategy and Decisions in Perspective ....................... 236
Questions for Reflection and Discussion......................................... 237
Exercises..................................................................................... 238
References .................................................................................. 239
Chapter X.
The Nature Of Strategic-Decision-Making Models ....................... 241
Decision with Multiple Criteria and Multiple Scenarios .................... 241
Optimal Decisions........................................................................ 249
Multi-Criteria or Multi-Objectives Decision Analysis....................... 256
Decision Based on Fuzzy Possibility Theory.................................. 261
Case Studies: Strategy and Decisions in Perspective ...................... 265
Conclusions................................................................................. 267
Questions for Reflection and Discussion......................................... 268
Exercises..................................................................................... 268
References .................................................................................. 270
Chapter XI.
The Role Of Simulation And Modern Business Games.................. 272
Probabilistic or Stochastic Process ................................................ 272
Using Simulation to Compare Multiple-Stage Strategic Decisions..... 273
Business Game Simulates Competition Among Companies .............. 279
Continuous System Simulation....................................................... 285
Case Study: Strategy and Decisions in Perspective......................... 288
Conclusions................................................................................. 291
Questions for Discussion and Reflection......................................... 292
Exercises..................................................................................... 293
References .................................................................................. 293
Chapter XII.
Decision Based On Organizational Knowledge, Decision Support
Systems, Expert System And Business Intelligence....................... 295
Introduction................................................................................. 295
The Framework for Strategic Decision Making............................... 296
Exploiting Solutions Using Expert Systems .................................... 298
Fuzzy Expert System.................................................................... 300
Decision Support Systems (DSS).................................................. 301
Exploring New Organizational Knowledge Using Business
Intelligence (BI) and Data Mining Techniques ............................ 309
Market Basket Analysis: Mining Association Rules.......................... 313
Comparing MIS, DSS, ES, and KDD........................................... 316
Case Study: Strategy and Decisions in Perspective......................... 317
Conclusions................................................................................. 318
Questions for Discussion and Reflection......................................... 319
Exercises..................................................................................... 319
References .................................................................................. 320
Chapter XIII.
Group Decision And Negotiation In Strategic-Decision-Making.... 322
Introduction................................................................................. 322
Individual and Group Behavioral Models ....................................... 323
Methodologies Used in Group-Decision-Making........................... 327
Decisions that Depend on the Behavior of Persons......................... 333
The Impact of Psychological Types................................................ 335
Negotiation Model....................................................................... 338
The General Multi-Objective and Multiple-Decision Problem .......... 339
Case Study: Strategy and Decisions in Perspective.......................... 343
Conclusion: What Constitutes a Good Strategic Decision?............... 346
Questions for Discussion and Reflection......................................... 347
Exercises..................................................................................... 349
References .................................................................................. 349
About The Authors........................................................................... 352
Index............................................................................................... 354