BUSINESS FUNDAMENTALS 2014-15

Faculty and affiliation:

Ramabhadran S. Thirumalai, Indian School of Business, [email protected] (First 2 sessions)
Deepa Mani, Indian School of Business, [email protected] (Last 3 sessions)

Business analytics is but one of the many technology innovations that is fast changing the competitive
landscape of modern businesses. These technological innovations and their business impacts have made
the management of technology a complex but potentially differentiating core business capability.
Companies that leverage technology innovations to create value and win competitive advantage have an
acute understanding of the strategic and organizational aspects of technology investments. They also
possess the ability to estimate and articulate the risks and business impacts of technology investments
to a wide range of stakeholders.
This course is designed to empower you with the above skills and capabilities so you can leverage
technology for efficiency, innovation and corporate transformation. The course topics will balance the
two opposing forces of efficiency and innovation impacts of technology. Some of the high-level learning
objectives in this course are:

Understand the ways in which technology creates competitive advantage; Identify
structures, processes, and managerial actions that allow firms to align their technology
strategies with business strategy and sustain superior firm performance
Understand the various options that firms have in the organization and governance of
their technology function, and the factors that drive their choice amongst these options
Understand how technology initiatives should be envisioned, structured and evaluated
in firms, including some of the ways in which the risks and business impacts of
technology investments can be estimated and articulated

Learning Goals: In addition to the course objectives, the course is designed to address the following
learning dimensions:
Effective Oral Communication: Students, in groups or individually, would assist in role
play exercises in the class and project presentations, as per the session outline.
Assessment:Class participation and presentations.
Critical and Integrative Thinking: Students are encouraged to present cogent
arguments, to draw appropriate conclusions, and to provide insightful
recommendations.
Assessment:Case discussions, pop quizzes, the end-term exam, the simulation
exercise as well as the industry disruption analysis.
Interpersonal Awareness and Working in Teams: Students are expected
to manifest the requisite interpersonal skills that are critical to working
in groups. Students are expected to coordinate their activities within the
teams and contribute equally to the activity at hand.
Assessment: Role-play activities, group projects.
Course materials
Readings for the course, including articles and cases, are included in the course pack. Individual sessions
combine lectures, class discussions, and case analyses. The questions for class discussion in each session
are included in the syllabus. Other relevant background readings will be posted on the course website.
You are expected to be familiar with their content, but these readings will not be discussed in detail in
the class. Instead, the ideas will be woven into the class discussions. You are also required to carefully
read and review lecture materials (e.g., PowerPoint slides) posted on the course website for access prior
to the each class session.

Grading criteria
Grades will be based primarily on performance in the midterm, end term, pop quizzes, and the industry
disruption analysis:
End Term Exam (Individual) 50%
End Term Project (Group) 30%
Class Participation (Individual) 20%
Total 100%

Grades for the course will be based on the following:
End Term Exam
The end term exam will include material covered in all sessions. The exam will be closed book and closed
notes. More details about the exams will be provided in the class.
End Term Project
Student teams will submit a written case analysis for the ICPL case in Session 4. This will be a study
group submission. Set in the context of ICPL, a hypothetical FMCG products company, student teams will
make decisions about investing in a portfolio of IT applications to advance the strategies and goals of the
company. The simulation is designed to provide a capstone experience on many of the concepts and
frameworks learned in the course.
Class Participation
Class participation is integral to student learning in this class. You will be expected to actively contribute
to the class discussion. Good class participation includes asking interesting and relevant questions,
sharing personal insights and experiences, offering constructive alternative points of view, and providing
courteous and professional feedback to other peoples opinions. You can also contribute to the shared
learning experience by offering pointers to additional articles or resources that add to the collective
knowledge and learning of the class.
Attendance Policy and Code of Ethics
ISB students are admitted partly based on the experiences they bring to the learning community and
what they can add to class discussions. Therefore, attendance is an important aspect of the CBA
Programme. Absence is only appropriate in cases of extreme personal illness, injury, or close family
bereavement. Voluntary activities such as job interviews, business school competitions, travel plans,
joyous family occasions, are not valid reasons for missing any class. However, if a student has to miss a
class due to an emergency, then he/she must obtain prior consent of the instructor. Two or
more unexcused absences will result in the student losing one grade point for the course.
Late arrival is disruptive to the learning environment and is actively discouraged. You will have to be in
class before the scheduled time. In addition, the use of texting, web surfing, or other similar behaviours
can be distracting to the instructor and other students. Therefore, students are discouraged from
engaging in such distracting behaviours during the class.
Project reports and/or presentations submitted for grading should be your own or your team's work
only. Each member of the team is expected to contribute equally to the group reports. Some case
materials in this course are based on actual companies. You may use firm specific or market data that
are publicly available for your analyses. You cannot, however, use old notes, handouts, or solutions to
the cases from previous or other sections of this course or similar courses elsewhere for your written
reports and class discussions. The purpose of the projects (simulation exercise and the industry
disruption analysis) is to develop your knowledge of key concepts for class discussion. Grades for such
write-ups will depend on the theoretical consistency, effort, clarity, succinctness, and creativity, not on
the correct solutions.
o B.F. session-1WebEx
o This week

SESSION 1: COURSE OVERVIEW AND INTRODUCTION TO PROJECT VALUATION
Learning Objective: Understand the basic financial tools and concepts used in assessing and comparing
the value of technology investments.
Readings: Ross, Westerfield & Jordan textbook, Chapters 6 and 10
(To be provided in the Course Pack)
Questions for Class Discussion:
What are the basic concepts underlying discounted cash flow analyses?
How can managers assess the value of technology investments and compare them with
other investments?
o

SESSION 2: MANAGING AND MAKING THE BUSINESS CASE FOR HIGH RISK IT INVESTMENTS
Learning Objective: To understand the costs and benefits of strategic technology investments and
analyze the business case for such investments, including applying the options approach to justify and
manage large, risky IT projects.

Questions for Class Discussion:
What are the challenges and risks of investing in new technologies?
How do business executives assess the economic and strategic viability of promising
technology investments? What are the different metrics used for assessing such
viability?
What is an options approach to managing technology investments?

Reading: R.G. Fichman, M. Keil and A. Tiwana, Beyond Valuation: Options Thinking in IT Project
Management, California Management Review, HBS # CMR 304 February 2005.
Case: B&K Distributors
Questions for Case Discussion:
What are the benefits of the proposed web portal?
What is the return on investment for the proposed web portal project?
Would you recommend that B&K implement the proposed portal? Justify your
recommendation.
o

SESSION 3: DIGITIZATION AND COMPETITIVE ADVANTAGE
Learning Objective: Understand the ways in which firms use technological innovation to strengthen and
enhance their competitive advantage.

Questions for Class Discussion:
How do technological innovations enhance the business strategy of a firm and confer
competitive advantage?
How do firms derive and sustain technology-based competitive advantage?

Reading: Andrew McAfee and Erik Brynjolfsson, Investing in the IT that Makes a Competitive
Difference, Harvard Business Review, July 2008
Case: IT-enabled Transformation at Reliance Energy
Questions for Case Analysis:
What are some the regulatory constraints operating on the power sector?
What were the business imperatives driving Reliance Energys technology initiatives?
What were some of the organizational changes required to support the technological
changes?
What were the impacts of this transformation on the companys operational efficiency,
customer value, market share, and overall growth story?
o

SESSION 4: A PORTFOLIO APPROACH TO THE MANAGEMENT OF TECHNOLOGY INVESTMENTS
Learning Objective: Understand how firms can align their technology strategy with their business
strategy and operating model.

Questions for Class Discussion:
How does a firms business strategy and operating model define its portfolio of IT
investments?
What are the different classes of IT investments? What is a portfolio approach to
managing these different classes of investments?
What are the challenges that firms face in implementing their operating models?

Reading: Weill, P., Aral, S., IT Savvy Pays Off: How Top Performers Match IT Portfolios and
Organizational Practices, MIT CISR Working Paper 353
Case: Indus Consumer Products Limited (ICPL)
Questions for Case Analyses:
What are some of the business imperatives driving ICPLs portfolio of IT investments?
What is the extent of standardization and integration required in ICPLs operating
model? Does the companys IT reflect these attributes of the operating model?
What is the portfolio of IT investments that best reflect ICPLs capabilities and strategy?
o

SESSION 5: THE ORGANIZATION OF TECHNOLOGY
Learning Objective: Understand under what conditions are the ownership of strategic technology
investments (e.g. analytics platforms) outsourced, the complexities of managing these technology
partnerships, and the critical elements of their governance.

Reading: Ravi Aron and J. Singh, Getting Offshoring Right, Harvard Business Review, Dec 2005
Questions for Class Discussion:
What are some of the factors that drive ownership decisions for complex, nascent
technologies?
How do client-vendor partnerships for these technologies differ from transactional
outsourcing forms in terms of benefits, risks, contracts and other governance
parameters?