Chapter 0. Introduction Managing and Using Information Systems: A Strategic Approach by Keri Pearlson PowerPoint Slides prepared by Gene Mesher Copyright © 2001 John Wiley & Sons, Inc.

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THE CASE FOR PARTICIPATING IN DECISIONS ABOUT INFORMATION SYSTEMS

Why Managers Need to Participate in IS Decisions “Dialogue among managers routinely crosses all business functions in formal as well as informal settings, with one general exception: IS. Management continues to tolerate ignorance in this area relative to other specialized business functions. Culturally, managers can claim ignorance of IS issues without losing prestige among colleagues. On the other hand, admitting a lack of knowledge regarding marketing or financial aspects of the business will earn colleagues contempt.” (Pearlson, p.2)

Why Managers Need to Participate: A Business View US companies spending $6,000 per employee on IT, use is growing exponentially. Managers must decide how best to use these funds.

People and Technology Work Together… Incorporating IT into a business enables people to focus on customer satisfaction and other revenue and profit-generating activities. Skilled business managers must balance costs associated with changing existing workplace behaviors. Issues include why or why not adopt new technology and when to replace people with technology.

Rapid Change in Technology Rapid Change in Technology means: A rapidly changing business environment. Competitors are coming from unexpected places. New business opportunities are coming with little advanced warning. Managers must develop an information model to discuss specific issues with co-workers, customers and others.

The Case for Participating in Decisions about IS What if a Manager Doesn’t Participate? Profits = Revenue – Expenses. Decisions about IS have a direct impact on business profits. Not considering IT business & organizational strategy leads to one of three consequences: 1. IS that fail to support business goals 2. IS the fail to support organizational systems 3. A misalignment between bus. and org. strategies

The Case for Participating in Decisions about IS Information Systems Must Support Business Goals IT is a major investment but poorly planned systems can result in Customer dissatisfaction Excessive production costs Delays in meetings business goals

Info Systems Must Support Organizational Systems Organizational systems: the people, work processes, structure and plan that enable these to work together If IS fails to support organizational systems Resources and goals are poorly aligned because technology gets deployed without careful thinking about how it will be used E.g., implementing systems without training Or setting up an ERP without thinking about current work practices

WHAT SKILLS ARE NEEDED TO PARTCIPATE EFFECTIVELY IN INFORMATION TECHNOLOGY DECISIONS?

Participating in IS Decisions Focus on business solutions Curiosity Creativity Project Management Communication Interpersonal skills Analytical skills Organizational skills Planning skills Flexibility

BASIC ASSUMPTIONS

Classic Management Model (Stoner) Managers engage in the following activities to meet corporate goals: Planning: think in advance about goals and actions. Actions use a method, plan or logic. Organizing: coordinating and directing human and material resources to reach corporate goals. Leading: lead others and create environment to help subordinates do their best. Controlling: attempt to assure the organization is moving towards its goal, including keeping the organization on track.

Managerial Roles (cf. Mintzberg 1973) Formal Authority and Status Model used to describe the chaotic nature of the environment in which managers actually work. Interpersonal Figurehead Leader Liaison Informational Roles Monitor Disseminator Spokesman Decisional Roles Entrepreneur Disturbance handler Resource allocator Negotiator

Functional View of the Firm Info flows vertically up between line positions and mgmt. After analysis is flows across to other functions. Functional view is used when similar activities are being explained, Coordinated, communicated or executed. Executive Management I N F O L W S A C T N G O P S M K T N G S A L E S

Porter’s Value Chain Model of the Firm Process view: used when examining the flow of information through a business. Firm Infrastructure Margin Human Resource Mgmt. Technology Development Procurement Inbound Logistics Marketing & Sales Operations Outbound Logistics Service Margin

Information Ecology (Davenport) Data Simple Observations of the world: Easily structured Easily captured on machines Often quantified Easily transferred Information Data endowed with relevance & purpose: Requires unit of analysis Need consensus on the meaning Human mediation necessary Knowledge Info. from the mind includes reflection, context, synthesis: Hard to structure Difficult to capture on machines Often tacit Hard to transfer

Information Ecology Data = simple observations Information = data endowed with relevance and purpose. Knowledge = information that has been situationalized and contextualized to provide value.

System Hierarchy Management Information Systems People Technology Process

System Hierarchy Infrastructure = hardware, software, data and network Architecture means strategy Information System = combination of people, process which facilitates the communication of data, information and knowledge through an organization Management monitors overall performance, develops business requirements and business strategy. IS needs to meet this strategy.

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