Business Information Systems

QUESTION : WHICH LEGAL REGULATIONS AFFECT BUSINESS AND CAUSE PRESSURE TO COMPANIES? HOW DO COMPANIES REACT TO THAT PRESSURES WITH MEANS OF INFORMATION TECHNOLOGY? GIVE EXAMPLES.

zkan Yilmaz MPI - 2169300

Agenda

1. 2. 3. 4. 5.

Business Pressures Market Pressures Technology Pressures Societal Pressures-example of implementing IT to prevent tax evasion in Turkey Organisational Responses

Major Business Pressures

y Changes of the business environment which consists

of a variety of factors
social, technological, legal, economic, physical and political.

y Significant changes in any of these factors leads to

business pressures on organisations.

Major Business Pressures

Market pressures,Technology pressures and Societal pressures.

Market Pressures
y Global economy and strong competition;
Global competition is intensified as government become involved through the use of subsidies, tax policies, import / export regulations & incentives.

Rapid and inexpensive communication and trasportation modes increase the magnitude of international trade even further.(e.g., NAFTA and European Market)

Market Pressures
y Changing Workforce; The workforce is becoming more diversified with more females,single parents,minorities and handicapped persons working in all types of positions.

y Powerful Customers; Consumer sophistication& expectations increase as customer become more knowledegeable about the availability and quality of products and services. (e.g., eBay,amazon,mobil.de etc.)

Technology Pressures
y Technological Innovations and Obsolescence;

Some of today`s state-of-the art products and services may be obsolete tomorrow thus technology accelerates the competitive forces.

Technology Pressures
y Information Overload;

The management of information has become more critical thus the amount of information available on the internet more than doubles every year and most of it is free. Critical managerial decision making with data accessibility is provided effectively by information technology such as search engines,intelligent databases.

Societal Pressures
y Social Responsibility; Social issues that affect business range from the state of the physical environment to companies` contributions to education(e.g.,allowing interns to work in the companies) y Ethical Issues; Business ethics relates to standards of right and wrong in business practises. y Government Regulations and Deregulation; Regarding health,safety,environmental control and equal opportunity.

Societal Pressures
Example of the Government regulation against tax evasion;
Min.monthly salary in Turkey is 760TL(380 before tax) and approximately one third of this amount will be deducted by Social Security Institution.
No Total Amout of salary Proportion (for insuarence) Amount of insurance deducted(TL) Amout of salary (TL)

1 = 1.968 TL

1 2 3 4 5

760 1333.33 2000 2666.66 4000

1/3 1/3 1/3 1/3 1/3

190 333.33 500 666.66 1000

570 1000 1500 2000 3000

143 Tl extra profit 310 Tl extra profit

Societal Pressures
What has Turkish government done?
They solved this problem with IT application and created a network among companies, banks, Social Security Institute and Department of Finance via online-banking.

Every Salaries and rental transactions must be sent via bank account.

Example of Salary and Rental Income

Data of Bank accounts

controlling

Tax Office

Banks

Information & money transfer

Companies

Tenants

controlling

Social Security Institutions

Organisational Response
y Strategic Management and Systems;
To develop a corporate strateg of how to handle the business pressure. To increase market share and/or profit,to better negotiate with suppliers,or to prevent competitors from entry the market through Web-based systems. For example Federal Express`s overnight delivery system and my account are supported by IT.

Organisational Response
y Continuous Improvements;
Many companies attempt to improve their productivity, quality and to provide customized products and services with IT facilitations , Such as total quality management(TQM) and six sigma,knowledge management,productivitiy and creativity improvements,just-in-time(JIT) through changing manufacturing process.

Organisational Response
y Business Alliances;
Alliances with other companies even along with competitors can be very beneficial. Types of alliances ;sharing resources,doing procurement jointly,establishing permanent supplier-company relationship For example, General Motors and Ford created a joint venture in electronic commercial applications. And the major airlines in Southeast Asia created a joint portal in 2003 that promotes travel to the region.

Questions?

Thank you for your attention! Any question?