9/10: Ch. 3 IS, Orgs, & Management Organizations & Information Systems –What is an organization? How IS Affects Organizations

Organizations & IS What is an organization? How can IS affect an organization? Features of organizations –SOPs –Politics –Culture –Organizational Type –Environment –Goals –Business Processes -- cross-functional

Evolution of IT Infrastructure EAMs to networked organizations New department: IS –responsible for maintaining hardware, software, data storage, and networks that make up the IT infrastructure –programmers, system analysts, IS managers –Other individuals: CIO, end users

IS Membership Programmers –Highly trained technical specialists who write computer software instructions Systems Analysts –Specialists who translate business problems and requirements into information requirements and systems; they act as liaisons between the IS department and the rest of the firm IS Managers –Leaders of the IS specialists

How IS Affects Organizations Economic theories –microeconomic model of the firm IT is factor of production As price of IT is falls, increase IT to decrease labor or capital costs. –transaction cost theory firms grow because internal market transactions are cheaper than external market transactions. IT can make external markets cheaper to deal with, changing the balance. –agency theory “nexus of contracts” increase flow of information, increase efficiency of managers, flatten organization

How IS Affects Organizations Behavioral Theories –decision-making hierarchy IT increases flow of information, thereby encouraging self-managed workers –political competition theory IT is a battleground to influence organizational culture, policies, procedures, and resources IT is an means of access to key resource: information

Factors to consider for new IS Organization’s environment Organization’s structure, politics, and culture Type of Organization, leadership style & nature Top management’s support & understanding Principal affected interest groups Kinds of tasks & business processes to be aided Attitudes of workers who will use new system Organizational history

New Information Systems Enterprise System –Firmwide IS that integrates key business processes for free-flowing information between parts of the firm –SAP, PeopleSoft Industrial Network –Network that links systems of multiple firms in an industry. AKA “Extended Enterprises”. –Vertically organized vs horizontally organized

Role of Managers in Organizations Why discuss it? To understand how IS can benefit managers. Classical description: Managers have 5 functions: –planning –organizing –coordinating –deciding –controlling

Role of Managers in Organizations Behavioral Model: Managerial Roles –Interpersonal roles: motivate, counsel, support, liaison, act as figureheads –Informational roles: act as nerve center, distribute information, act as spokespersons –Decisional roles: initiate new activities, handle disturbances, allocate resources, negotiate & mediate conflicts.

IS Helps Managers in their Roles Interpersonal: –Liaison -- electronic communication systems Informational: –Nerve center -- Management Information Systems Disseminator -- Mail, office systems Spokesperson -- Office & professional systems, workstations Decisional: –Resource allocator – Decision Support Systems

IS Helps Managers Make Decisions Recall that different decisions are made at different organizational levels: –strategic level –managerial level –knowledge level –operational level

IS Systems for Decision Making Operational Knowledge ManagementStrategic Unstructured Semi Structured TPS ESS DSS MIS Office Systems KWS

Stages of Decision Making Intelligence –gather information, define problem Design –conceive alternatives, select criteria Choice –use criteria to select alternative as solution Implementation –put decision into effect, evaluate results, monitor solution