Information Technology

Impact Client Internal processes Inter-organizational processes

IT Impact on Process Innovation Automational Informational Sequential Tracking Analytical Geographical Integrative Intellectual Disintermediating Source: Davenport, 1993, 51 Automate Capture and use information Share and distribute information

Impact and IT AutomationCapture and use information Share and distribute information Client Internal Inter- organizational

Key questions What capability does a particular information technology give me? Can I afford the upfront capital costs? Can I afford the maintenance costs?

Automational Eliminate human labor from process Value created for clients: –Speed up the process of service e.g. ATMs, electronic tax-filing, grocery checkout –Decreases chances of “clerical error” Value created for internal processes –Cuts in unskilled labor “Labor cost” savings only result if capital expenses of IT plus hiring of IT maintenance personnel do not exceed costs of unskilled labor –Decreases in errors/deception Cash “leakage” in situations where cash-handling is replaced by automation Data-entry – automation may cut number of times data are entered –Transfers responsibility of data-entry to clients Inter-organizational value –Improved supply chain management –Clear assignment of responsibility for action (minimizes chance of something getting “lost.”)

Informational Capturing information Client –Easier access 24/7 when combined with automation – web-based, automated telephones –In format that is ready for analysis Government statistics such as census bureau –Increases variety of formats – visual (pictures, text-based), oral Internal processes –Effective informational capture in format ready for analysis Measurement techniques Speed at which information is available –Enhanced when automated – water district gathers information automatically from each home Inter-organizational –Improved coordination through sharing of information

Sequential Changing the process sequence Clients –Ease of record retrieval when dealing with customer service representative Ability to “pull up your record” in real time – IRS case next time –Push information onto clients that they can then respond to, rather than have them seek the information listservs Internal processes –Scanned documents can be “worked on” by more than one person at a time without a pile up of paper –Networked, shared documents can be worked on in parallel Inter-organizational –Ability to work on a project in parallel across organizational lines –Push information onto potential partners Sign up for automatic notification of bidding opportunities, e.g. State of Washington WEBS –

Tracking Goods and services through the process For clients, internal processes, and inter- organizational relations –Ability to identify easily where WIP is in process –Ability to identify easily when steps in process will take place E.g. FedEx, UPS, USPS tracking systems –UPS “Brown” ads highlight the utility of third- party tracking system for internal and inter- organizational tracking

Analytical Analyze information you have gathered IT is good at producing information, but that information must be analyzed and used Client benefits from –Potential for greater objectivity and transparency E.g. Automated Underwriting and Credit Scoring? –Ability to conduct own analysis on data from agency Internal processes –Rapid flow of information, and automated aggregation and manipulation of data allow for quicker decisions MIS in microfinance Inter-organizational –Potential for more responsive coordination if information-sharing in the right format is possible

Geographical A particular type of information Geographical information is simply a particular type of information In public sector and non-profit situations, much of the value-delivery and –creation is location-specific –Government jurisdictions –Service areas Client impact –Able to identify services available to them geographically – plug in an address to a school district web site and you can find which school your child will be going to; then check the test scores of that school; then decide whether you want to buy the house at that address –Ease the ability to cross jurisdictional boundaries – bar-code scanning of passports Internal processes –Ease boundary-drawing tasks –Control borders more effectively –Establish transportation routes more efficiently – on-line grocery stores set up routes for delivery trucks flexibly on a “just-in-time” basis Inter-organizational processes –Clear boundary delineations –Effective border control can improve relations – “good fences make good neighbors”

Integrative IT that integrates all components of the organization Client –One-stop shopping Internal processes –Decrease duplication of data-entry –Real time, integrated information Inter-organizational –Potential to share information in an integrated manner – updating internal information also updates relevant external information SAP – the integration of financial and operational data to provide real time data on financial and operational status of organization –E.g. ordering a part results in the automatic upgrading of the financials as well as the status of parts inventory

Intellectual Capturing situation-specific information Knowledge databases How good are they at tapping tacit knowledge?

Disintermediation Making information generally available Information dispersal should result in: –Greater transparency –Greater client choice