Real strategies for virtual organizing.ppt

1. REAL STRATEGIES FOR VIRTUAL ORGANIZING N. Venkatraman – John C. Henderson Presented By, B. Sundaravadivelu ESIGELEC, Rouen, France Email: [email protected] 2. POINTS TO DISCUSS What is Virtual Organizing Dimensions Customer Interaction Asset Configuration Knowledge Leverage 3. VIRTUAL ORGANIZING Virtual Organizing is a strategic approach that is singularly focused on creating, nurturing and deploying key knowledge assets in a complex network of relationships. Developed with IT at the center 4. DIMENSIONS Customer Interaction  Company to Customer interaction Asset Configuration  Manage firms requirements through business network Knowledge Leverage  Share expertise across organizational boundaries 5. STAGES OF DIMENSIONS 6. CUSTOMER INTERACTION In Early days, this process happened through multistage distribution network This involves retailers, wholesalers, service agents Evolving economy allows two way information link between customer and company through remote mechanism. This is available in business to business products as well. Three stages of Customer interaction  Remote experience of products and services  Dynamic customization  Customer communities 7. CUSTOMER INTERACTION – REMOTE EXP Sears, Roebuck was the first successful attempt of creating a virtual product experience. Remote and continuous link with customers become critical as the concept of brand identity and brand equity. Internet has accelerated the possibilities of remote product and service experience.  Mailing services (FedEx)  Stock services  Airlines and Bank services Traditional selling of textbooks have changed to web based links for books Website is essential 8. CUSTOMER INTERACTION – DYNAMICCUSTOMIZATION Focuses on dynamic customizing products and services Based on three principles  Modularity  Partitioning into independent modules  Reusability  Intelligence  Sites learn their visitors taste and deliver dynamic personalized information about products and services.  Organization  Need to change how they look at marketing processes. 9. CUSTOMER INTERACTION – CUSTOMERCOMMUNITIES Communities are information gathering and information disseminating platform. Five defining characteristics of virtual communities  Focus  Capacity to reach larger audience  Appreciation of member generated content  Competing offerings  Commercial orientations Companies which have implemented  Citibank – For customers to know their product  Harley-Davidson – Share Harley owners pictures and stories 10. ASSET CONFIGURATION Acquiring critical assets and resources from external markets Effective contracting for complementary capabilities through a network of suppliers and subcontractors. Allows companies to focus on their core competencies which will also obtain complementary assets through inter-firm relationship. Three stages of Asset configuration  Sourcing modules  Process Interdependence  Resource coalitions 11. ASSET CONFIGURATION – SOURCING MODULES Deals with the benefits of efficiently sourcing standard modules or components. Sourcing logic plays a vital role for any company. Selection of assets is complicated because the criticality of assets changes over time Personal computer market which was conceptualized by IBM in 1980. 12. ASSET CONFIGURATION – PROCESSINTERDEPENDENCE Focuses on interdependence of business processes across organizational boundaries. Business process outsourcing with full control. This involves delegation of one or more business processes to an external service provider Examples:  DirecTV: Integrated satellite television, phone  FedEx: Virtual order taking and processing of orders. 13. KNOWLEDGE LEVERAGE The basic economic resource is not land, physical resources or capital but knowledge and intellectual assets. Knowledge assets can support rapid execution of strategies, increase learning rate of employees and their response rate to customers. Three states of Knowledge Leverage  Work-Unit Expertise  Recognizing knowledge as Corporate Assets  Professional community expertise 14. KNOWLEDGE LEVERAGE – WORK UNIT EXPERTISE Tasks can be decomposed and can be done at different locations and time periods. IT functionality like group ware, video conferencing and intranets are necessary to make processes effective in an organization. Knowledge sharing sessions are held between teams to share expertise Companies distribute work to teams in different time zones. 15. CORPORATE ASSETS & PROFESSIONAL COMMUNITYEXPERTISE Knowledge is a corporate wide asset that should be systematically managed. Emerging virtual communities serve as a primary mechanism for collecting and legitimizing knowledge and expertise Multiple experts from different locations can simultaneously interpret the meaning of unforeseen event Companies face the challenge of how to compensate and motivate the expertise from multiple sources. 16. CONCLUSION Challenges for transition  Designing new business model  Interacting with customer for knowledge leverage  Navigating across multiple communities  Deploying IT platform Virtual organizing as a concept focuses on the importance of knowledge and intellect in creating value.