1. International MIS The International Dimension

2. INT_DIM-2 Study Questions Copyright © 2015 Pearson Education, Inc. Q1: How does the global economy affect organizations and processes? Q2: What are the characteristics of international IS components? Q3: What are the challenges of international enterprise applications? Q4: How do inter-enterprise IS facilitate global supply chain management? Q5: What are the challenges of international IS management?

3. INT_DIM-3 Q1: How Does the Global Economy Impact Organizations and Processes? After World War II, Japan and other Asian countries increased manufacturing. Fall of Soviet Union opened economies of Russia and Eastern Europe. N. American and European economies integrated. Plentiful, cheap telecommunications. Booming economies: India, China, Brazil are some examples. EU- and U.S.-based companies find greatest opportunities outside their own national markets. Copyright © 2015 Pearson Education, Inc.

4. INT_DIM-4 Percent of Cross ‐ Border Commerce: Opportunities Abounds Copyright © 2015 Pearson Education, Inc.

5. INT_DIM-5 Organizational Strategy Determines Information Systems Copyright © 2015 Pearson Education, Inc.

6. INT_DIM-6 How Does the Emerging Global Economy Change Competitive Strategy? Impact of Internet Wider range of customers Wider range of vendors Facilitates new entrants Intensifies rivalry Copyright © 2015 Pearson Education, Inc.

7. INT_DIM-7 How Does the Global Economy Change Competitive Strategy? (cont'd) Accelerates flow of data about price, product, availability, and service. Products localized to language and culture. Internet supports unprecedented market size and product differentiation. Copyright © 2015 Pearson Education, Inc.

8. INT_DIM-8 How Does the Global Economy Change Value Chains and Business Processes? Value chain activities can be performed anywhere. Final product frequently distributed throughout world. Abundance of low-cost, well-educated, English-speaking professionals allows outsourcing service and support functions. Ability to work 24/7 by moving work into other time zones increases productivity. Copyright © 2015 Pearson Education, Inc.

9. INT_DIM-9 Q2: What Are the Characteristics of International IS Components 1.Hardware – sold worldwide. 2.Software and interfaces – in multiple, local languages. 3.Data – choosing language(s) for data descriptions and remarks. 4.Procedures – reflect local cultural values and norms. 5.People – job descriptions and reporting relationships appropriate to culture. Copyright © 2015 Pearson Education, Inc.

10. INT_DIM-10 What’s Required to Localize Software? Copyright © 2015 Pearson Education, Inc.

11. INT_DIM-11 What’s Required to Localize Software? (cont'd) Localizing programs much more difficult, expensive, and time consuming than translating documents. Plan for localization from the beginning. When considering acquisition of a company in a foreign country, budget time and expense for localization of information systems. Copyright © 2015 Pearson Education, Inc.

12. INT_DIM-12 What Are the Problems and Issues of Global Databases? Commit to a single company language. Single database is not possible for companies using multiple languages. Applications are needed to export and import data among separated databases. Slow data transmission speeds may require distributed, partitioned databases and highly skilled personnel. Copyright © 2015 Pearson Education, Inc.

13. INT_DIM-13 Types of Distributed Database Processing Distributed database –Single database resides in multiple locations. Replicated database –Multiple copies of a database distributed. –Updating requires highly skilled personnel. Partitioned database –Database divided into non-overlapping segments. Copyright © 2015 Pearson Education, Inc.

14. INT_DIM-14 Q3: What Are the Challenges of International Enterprise Applications? Independent Functional Systems Inherent Processes Unnecessary to accommodate language, business, and cultural differences Differences in language, culture, norms, and expectations Requires adequate data interface Developing and evaluating “as is” models and alternative international processes incredibly challenging Integrated, cross-functional, international system with high-level processes connected by SOA standards and the cloud Copyright © 2015 Pearson Education, Inc.

15. INT_DIM-15 Advantages of Functional Systems Lack of integration can have advantages for international organizations and international systems. U.S. order-processing systems operate in English, reflect practices and culture of U.S. Taiwanese manufacturing information systems operate in Chinese and reflect business practices and culture of Taiwan. Need adequate data interface between two systems. Copyright © 2015 Pearson Education, Inc.

16. INT_DIM-16 Problems of Inherent Processes Some inherent processes may conflict with cultural norms. Very difficult to convince employees to follow those inherent processes, or more difficult in some cultures. Future inter-enterprise business processes will be defined to document service responsibilities of each international unit. The cloud and Web service standards used to connect services into an integrated, enterprise, international system. Copyright © 2015 Pearson Education, Inc.

17. INT_DIM-17 Q4: How Do Inter-enterprise IS Facilitate Global Supply Chain Management? Copyright © 2015 Pearson Education, Inc.

18. INT_DIM-18 Supply Chain Example Copyright © 2015 Pearson Education, Inc.

19. INT_DIM-19 Importance of Information in the Supply Chain Global information systems increase supply chain profitability by: Reducing inventories. Reducing or eliminating bullwhip effect. Producing comprehensive, accurate, timely information. Choosing delivery option that optimize value. Enabling 24/7 global shipment tracking. Copyright © 2015 Pearson Education, Inc.

20. INT_DIM-20 Example of Walmart Supply Chain Copyright © 2015 Pearson Education, Inc.

21. INT_DIM-21 How Can Information Relieve the Bullwhip Effect? Copyright © 2015 Pearson Education, Inc.

22. INT_DIM-22 Eliminate Bullwhip Effect with True Demand Information Copyright © 2015 Pearson Education, Inc.

23. INT_DIM-23 Q5: What Are the Challenges of International IS Management? International information systems larger, more complex International IT depts. bigger, more cultures, languages More IT assets, risks, greater uncertainty Complex international law, security incidents complicated to investigate. Copyright © 2015 Pearson Education, Inc.

24. INT_DIM-24 Why Is International IS Development More Challenging? 1.Define a set of standard business processes –Requires adapting to different work processes. –People resist change, especially if it violates cultural norms. 2.Develop alternative versions of system to support different processes in different countries –High maintenance expenses. Copyright © 2015 Pearson Education, Inc.

25. INT_DIM-25 Why Is International IS Development More Challenging? (cont'd) Copyright © 2015 Pearson Education, Inc.

26. INT_DIM-26 What Are the Challenges of International Project Management? Copyright © 2015 Pearson Education, Inc.

27. INT_DIM-27 What Are the Challenges of International IS Management? Aligning IT and IS resources with competitive strategy more complex and difficult. Conducting operations in different countries, cultures, and languages adds complexity. Integrating different company systems. Integrating with outsource vendors’ information systems. Protecting IS and IT infrastructure. Copyright © 2015 Pearson Education, Inc.

28. INT_DIM-28 How Does the International Dimension Affect Computer Security Risk Management? IT assets subject to more threats –Political threats, civil unrest, terrorists, natural disasters. Likelihood of a threat more difficult to estimate. Uncertainty about risks high. Human safeguards chosen and evaluated on a culture-by- culture basis. Copyright © 2015 Pearson Education, Inc.

29. INT_DIM-29 Setting Up Information Systems in Foreign Offices Obtain hardware and networking equipment from the local economy. Purchase or lease a facility, local vendors supply and set up hardware, a local area network, and access to internet. Bring in own IT professionals to install software. Use same accounting software and chart of accounts, and same business processes, worldwide. Twice a year conduct internal audits to verify compliance. Allow transactions in local currency. ERP system centralized database in home country. Copyright © 2015 Pearson Education, Inc.

30. INT_DIM-30 Active Review Q1: How does the global economy affect organizations and processes? Q2: What are the characteristics of international IS components? Q3: What are the challenges of international enterprise applications? Q4: How do inter-enterprise IS facilitate global supply chain management? Q5: What are the challenges of international IS management? Copyright © 2015 Pearson Education, Inc.

31. INT_DIM-31