Assignment: Consumer‐Centric Industries
Assignment: Consumer‐Centric Industries
The Information Systems Strategy Triangle highlights the alignment necessary between decisions regarding business strategy, information systems, and organizational design. This chapter reviews models of business strategy, organizational strategy and design, and information systems strategy. It concludes with a simple framework for creating a social business strategy.
1 http://blogs.wsj.com/cio/2015/02/09/kaiser‐permanente‐names‐richard‐dick‐daniels‐cio/; http://fortune.com/2015/04/29/kaiser‐ ceo‐on‐healthcare/; http://fortune.com/2014/07/24/a‐health‐care‐model‐thats‐working/; Paul Gray , Omar Sawy , Guillermo Asper , and Magnus Thordarson , “ Realizing Strategic Value Through Center‐Edge Digital Transformation in Consumer‐Centric Industries ,” MIS Quarterly Executive 12 , no. 1 ( March 2013 ) . 2 Note that the organizational design puts the organizational strategy into practice. For instance, rewarding billings, sharing little information, and late involvement with patients are organizational design elements of a “fix‐me” organizational strategy.
The Information Systems Strategy Triangle
fix the problem. Instead, the Kaiser Permanente strategy focused on promoting health, enabling identification of problems before they became serious issues. For example, those in need of more exercise may receive a prescription to take a walk and an e‐mail reminder from health care providers to reinforce the new behavior. Staff incentive systems were aligned with this behavior, too. Physicians were all paid a flat salary and end‐of‐year bonuses if their patients achieved better health. All caregivers were rewarded for guiding people into making behavioral choices that were likely to keep them well.
The success at Kaiser Permanente was achieved in part because of the alignment between its business strategy, its information systems strategy, and its organization design. Physicians were part of the decision‐making processes. Managers were involved in the design and implementation of the information systems. The decision to move from a “fix‐me system” to a “proactive health system” was not made in isolation from the organization or the information systems.
The information systems (IS) department is not an island within a firm. Rather, IS manages an infrastructure that is essential to the firm’s functioning. Further, the Kaiser Permanente case illustrates that a firm’s IS must be aligned with the way it manages its employees and processes. For Kaiser Permanente, it was clear that not only did the physicians need a fast, inexpensive, and useful way to communicate with patients outside of regular in‐person appointments but also incentive systems and patient service processes had to be updated. Information systems provided a solution in conjunction with new operational and control processes.
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