l Organizations and Their Structures l The Nature of Information in an Organization (and Decentralized Computing) l IT systems in an Organization and the Tasks They Perform Introduction INFORMATION TECHNOLOGY SYSTEMS Supporting Information Processing

Information Technology Is Now a Part of Almost Every Organization l Some IT systems simply process transactions l Some help managers make decisions l Some support the inter-organizational flow of information l Some support team work l Seeing more supply chain IT systems - WalMart and 3 day inventory replacement Introduction

THE TRADITIONAL STRUCTURE OF AN ORGANIZATION An Organization NONMANAGEMENT STRATEGIC TACTICAL OPERATIONAL MANAGEMENT

THE TRADITIONAL STRUCTURE OF AN ORGANIZATION 1.STRATEGIC MGMT - provides an organization with overall direction and guidance. 2.TACTICAL MGMT - develops the goals and strategies outlined by strategic mgmt. 3.OPERATIONAL MGMT - manages and directs the day-to-day operations. 4.NONMANAGEMENT - those people who actually perform daily activities. An Organization

Organizations Also Have Depth... An Organization Within the pyramid, many organizations structure according to: (1) Function (marketing, accounting, etc.) (2) Product line (e.g., GM by Buick, Pontiac, etc)

When Considering Information, You Need to Understand... l The concept of shared information through decentralized computing l The directional flow of information l What information specifically describes l The information-processing tasks your organization undertakes Information

SHARED INFORMATION AND DECENTRALIZED COMPUTING Information As late as the early 1980s, most organizations exhibited centralized computing and isolated information. That is... l Large central mainframe computers that performed all tasks. l Separate files of information for each application or system. l So, computing power was centralized while information remained isolated.

SHARED INFORMATION AND DECENTRALIZED COMPUTING Information During the early to mid 1980s, most organizations exhibited decentralized computing and isolated information. That is... l Smaller, more powerful computers that were distributed to functional business areas. l These computers still maintained separate files of information for each application. l So, computing power was decentralized while information remained isolated.

SHARED INFORMATION AND DECENTRALIZED COMPUTING Information Today, organizations have maintained their decentralized computing while bringing together all the organization’s information. l This bringing together of information is accomplished by using databases. l Databases support the concept of shared information. l So, computing power is now decentralized and information is shared.

HOW INFORMATION FLOWS l Upward Flow of Information - describes the current state of the organization based on its daily transactions. l Downward Flow of Information - consists of the strategies, goals, and directives that originate at one level and are passed to lower levels. l Horizontal Flow of Information - between functional business units and work teams. Information See Figure 2.5 on page 46

WHAT INFORMATION DESCRIBES l INTERNAL INFORMATION - describes specific operational aspects of the organization. l EXTERNAL INFORMATION - describes the environment surrounding the organization. l OBJECTIVE INFORMATION - quantifiably describes something that is known. l SUBJECTIVE INFORMATION - attempts to describe something that is currently unknown. Information

TWO WAYS OF CREATING INFORMATION 1.TRANSACTION PROCESSING - the processing of transactions that occur within an organization. –Example: computing payroll and sales tax 2.ANALYTICAL PROCESSING - creating information to support your decision-making tasks. –Example: how to allocate investment dollars Information

THE SEVEN IT SYSTEMS IN AN ORGANIZATION IT Systems 1.Transaction Processing Systems (TPS) 2.Customer Integrated Systems (CIS) 3.Management Information Systems (MIS) 4.Workgroup Support Systems (WSS) 5.Decision Support Systems (DSS) & Artificial Intelligence (AI) 6.Executive Information Systems (EIS) 7.Interorganizational Systems (IOS)

TRANSACTION PROCESSING SYSTEM TPSs a system that processes transactions that occur within an organization. Capturing information Creating information Cradling information Conveying information (secondary) l Are at the very heart of every organization. l Provide the primary interface to customers. l Found in all functions of an organization. l If they fail, the whole organization suffers.

CUSTOMER INTEGRATED SYSTEM (CIS)... CISs an extension of a TPS that places technology in the hands of an organization’s customers and allows them to process their own transactions. Capturing information Creating information Cradling information Communicating information Conveying information (secondary) Represent a further decentralization of computing power by placing that power in the hands of customers. Will forever change the relationship between organization and customer. ATM’s, Bank on-line, TicketMaster, 800-Flowers

MANAGEMENT INFORMATION SYSTEM MISs a system that provides periodic and predetermined reports that summarize information within a database. Creating information Conveying information l Alert people to the existence of problems or opportunities. l Report Types: –PERIODIC - produced at a predetermined time interval. –SUMMARIZED - aggregate information in some way. –EXCEPTION - show only a subset of available information. –COMPARATIVE - show two or more sets of similar information.

WORKGROUP SUPPORT SYSTEM (WSS)... WSSs a system that is designed specifically to improve the performance of teams by supporting the sharing and flow of information. Communicating information l Supports the sharing, dissemination, and flow of information. l Supports both: –Project teams - that solve a specific problem or take advantage of a specific opportunity and then disband to move on to other projects. –Permanent teams - people from all departments that perform a flow of work consistently. l Contains groupware.

GROUPWARE WSSs the popular term for the software that supports the collaborative efforts of a team. Groupware Supports Three Functions: (See Figure 2.11 page Team Dynamics - , e-meeting, video & white board 2. Document Management 3. Applications Development

DECISION SUPPORT SYSTEM (DSS) & ARTIFICIAL INTELLIGENCE (AI) DSS & AI DSS - a highly flexible and interactive IT system that is designed to support decision making when the problem is not structured. AI - the science of making machines imitate human thinking and behavior. Creating information Conveying information (secondary) l GEOGRAPHIC INFORMATION SYSTEM (GIS) - a DSS designed specifically to work with spatial information. l GENETIC ALGORITHM - an AI system that mimics the evolutionary, survival-of-the-fittest process to generate increasingly better solutions to a problem. l EXPERT SYSTEM - an AI system that applies reasoning capabilities to reach a conclusion.

EXECUTIVE INFORMATION SYSTEM (EIS)... EISs a highly interactive MIS combined with decision support systems and artificial intelligence for helping managers identify and address problems and opportunities. Creating information Conveying information l Make use of a data warehouse. l Support drill down capabilities. l Help identify information responsibility. l Use DSS and AI tools. l Provide access to a variety of information.

HAVE EISs BEEN MISNAMED? l EISs provide managers and executives with the flexibility to view information from many angles and provide various tools for supporting data analysis. l Aren’t there other people in an organization who need those same capabilities? l Certainly - all employees need that type of support. l Maybe EISs should be named employee information systems. EISs2-33

INTERORGANIZATIONAL SYSTEM (IOS)... IOSs automates the flow of information between organizations to support the planning, design, development, production, and delivery of products and services. Communicating information l Supports ELECTRONIC DATA INTERCHANGE (EDI) - the direct computer-to-computer transfer of transaction information contained in standard business documents. l Allows many organizations to create an economies of scale in technology. l Provides a way for organizations to team up and create new products and services.

TO SUMMARIZE CAPTURE CONVEY CREATE CRADLE COMMU- NICATE TPS XX XX XX CIS XX XX XX XX MIS XX XX WSS XX DSS&AI XX EIS XX XX IOS XX