3. INFORMATION SYSTEMS, ORGANIZATIONS, & BUSINESS PROCESSES 3.1

LEARNING OBJECTIVES DESCRIBE CHARACTERISTICS OF ORGANIZATIONS RELATE INFO SYSTEMS TO ORGANIZATIONS COMPARE MODELS DESCRIBING SYSTEM ORIGINS * 3.2

LEARNING OBJECTIVES COMPARE THEORIES OF ORGANIZATIONS ANALYZE IMPACT OF INFO SYSTEM ON ORGANIZATION DESCRIBE IMPLICATIONS OF SYSTEM DESIGN & IMPLEMENTATION * 3.3

MANAGEMENT CHALLENGES DIFFICULTIES OF MANAGING CHANGE ADJUSTING TECHNOLOGY AND ORGANIZATION FOR OPTIMAL FIT * 3.4

ORGANIZATIONS & INFORMATION TECHNOLOGY MEDIATING FACTORS: Environment Culture Structure Standard Procedures Politics Management Decisions Chance ORGANIZATIONS INFORMATION TECHNOLOGY 3.5

ORGANIZATION TECHNICAL DEFINITION: STABLE, FORMAL STRUCTURE TAKES RESOURCES FROM ENVIRONMENT PROCESSES THEM TO PRODUCE OUTPUTS * 3.6

BEHAVIORAL VIEW OF ORGANIZATIONS ENVIRONMENTAL RESOURCES ENVIRONMENTAL OUTPUTS STRUCTURE: Hierarchy Division of labor Rules, Procedures PROCESS: Rights/Obligations Privileges/Responsibilities Values Norms People * 3.7

STRUCTURAL CHARACTERISTICS OF ALL ORGANIZATIONS CLEAR DIVISION OF LABOR HIERARCHY EXPLICIT RULES & PROCEDURES IMPARTIAL JUDGMENTS TECHNICAL QUALIFICATIONS MAXIMUM ORGANIZATIONAL EFFICIENCY * 3.8

ORGANIZATIONAL STRUCTURES ENTREPRENEURIAL: Startup business MACHINE BUREAUCRACY: Mid-sized manufacturing firm DIVISIONALIZED BUREAUCRACY: Fortune 500 PROFESSIONAL BUREAUCRACY: Law firms, hospitals ADHOCRACY: Consulting firm * 3.9

ORGANIZATION & ITS ENVIRONMENT THE ENVIRONMENT: RESOURCES & CONSTRAINTS GOVERNMENTS COMPETITORS FINANCIAL INSTITUTIONS CULTURE KNOWLEDGE TECHNOLOGY THE FIRM INFORMATION SYSTEMS 3.10

SALIENT FEATURES OF ORGANIZATIONS COMMON FEATURES: FORMAL STRUCTURE STANDARD OPERATING PROCEDURES POLITICS CULTURE * 3.11

SALIENT FEATURES OF ORGANIZATIONS UNIQUE FEATURES: ORGANIZATIONAL TYPE ENVIRONMENTS, GOALS, POWER CONSTITUENCIES, FUNCTION LEADERSHIP, TASKS TECHNOLOGY LEVELS * 3.12

WORK GROUPS, PROBLEMS, SYSTEM SUPPORT HIERARCHICAL: Frequent meetings, workers dispersed VIDEO CONFERENCING, E-MAIL INTERDEPARTMENTAL COMMITTEES: Need occasional direct communication ELECTRONIC MESSAGING * 3.13

WORK GROUPS, PROBLEMS, SYSTEM SUPPORT PROJECT TEAMS: Day-to-day interactions, meeting schedules SCHEDULING/COMMUNICATION/ SUPPORT SOFTWARE, INTRANET COMMITTEES: High peak load, intermittent communication ELECTRONIC BULLETIN BOARDS, VIDEO/COMPUTER CONFERENCING, E-MAIL * 3.14

WORK GROUPS, PROBLEMS, SYSTEM SUPPORT TASK FORCES: Rapid communication, internal/external data GRAPHICS DISPLAY, INFORMATION/ DOCUMENTATION INTERCHANGE PEER GROUPS: Intense personal communication TELEPHONE, E-MAIL * 3.15

PROBLEMS OF ALL WORK GROUPS MAKING ARRANGEMENTS ATTENDING MEETINGS LONG AGENDA COST OF MEETINGS BETWEEN-MEETING ACTIVITIES * 3.16

DEVELOPMENT OF INFORMATION ARCHITECTURE 1950s: ELECTRONIC ACCOUNTING MACHINES 1960s: DATA PROCESSING DEPARTMENTS 1970s: INFORMATION SYSTEMS 1980s: INFORMATION SYSTEMS & SERVICES 1990s: ENTERPRISE-WIDE INFORMATION UTILITY * 3.17

INFORMATION SYSTEMS DEPARTMENT PROGRAMMERS: Write software SYSTEMS ANALYSTS: Translate business problems into solutions IS MANAGERS: Department leaders END USERS: Department reps for whom applications are developed * 3.18

WHY ORGANIZATIONS BUILD INFORMATION SYSTEMS ENVIRONMENTAL FACTORS: External factors that influence adoption & design of system INSTITUTIONAL FACTORS: Internal factors that influence adoption & design of system * 3.19

HOW INFO SYSTEMS AFFECT ORGANIZATIONS MICROECONOMIC MODEL: Info technology is a factor of production, like capital & labor TRANSACTION COST THEORY: Firms attempt to minimize transaction costs internally & externally * 3.21

HOW INFO SYSTEMS AFFECT ORGANIZATIONS AGENCY THEORY: Firm is nexus of contracts among agents who make decisions; IS shrink number of agents & reduce cost BEHAVIORAL THEORIES: Concepts from Sociology, Psychology, Political Science; Organizations & Information Technology mutually influence each other * 3.21

HOW INFO SYSTEMS AFFECT ORGANIZATIONS DECISION & CONTROL THEORY: Decisions are made under conditions of risk & uncertainty; centralization & hierarchy reduce uncertainty SOCIOLOGICAL THEORY: Bureaucracy, SOPs help stabilize organizations, but slow ability to change * 3.22

HOW INFO SYSTEMS AFFECT ORGANIZATIONS POSTINDUSTRIAL THEORY: Flatter organizations; dominated by knowledge workers; decentralized decision making CULTURAL THEORY: Information technology must fit organization’s culture to be accepted * 3.23

HOW INFO SYSTEMS AFFECT ORGANIZATIONS POLITICAL THEORY: Info systems are outcome of political competition for policies, procedures, resources * 3.24

IMPLEMENTING CHANGE TASK PEOPLE TECHNOLOGY STRUCTURE RESISTANCE Source: Leavitt, Handbook of Organization (1965) TASK PEOPLE TECHNOLOGY STRUCTURE RESISTANCE MUTUAL ADJUSTMENT 3.25

HOW WEB AFFECTS ORGANIZATIONS MORE INFO, ANYWHERE, ANYTIME MORE SCOPE, DEPTH, RANGE OF KNOWLEDGE: Global encyclopedia LOWERS COST, RAISES QUALITY OF INFO DISTRIBUTION: Enhances attention span of vendors, customers, employees * 3.26

IMPLICATIONS FOR DESIGN & UNDERSTANDING INFO SYSTEMS ENVIRONMENT STRUCTURE CULTURE POLITICS * 3.27

ROLE OF MANAGERS INTERPERSONAL: Figureheads, leaders, liaison INFORMATIONAL: Receive & disseminate critical information DECISIONAL: Initiate activities, handle disturbances, allocate resources, negotiate conflicts * 3.28

Connect to the INTERNET PRESS LEFT MOUSE BUTTON ON ICON TO CONNECT TO THE LAUDON & LAUDON WEB SITE FOR MORE INFORMATION ON THIS CHAPTER 3.29

3. INFORMATION SYSTEMS, ORGANIZATIONS, & BUSINESS PROCESSES 3.30