1. CHAPTER 2 ORGANIZATIONS AND INFORMATION TECHNOLOGY SUPPORT

2. Learning Objectives
Discuss major information systems concepts such as architecture and infrastructure.
Describe the hierarchical structure of organizations and the corresponding information systems.
Define various information systems and their evolution, and categorize specific systems.
Describe the support provided to different types of employees in an organization.
Describe how information resources are managed.

3. Chapter Overview Information Systems Infrastructure and Architecture
Organizations: Structure and Support
Evolution and Types of Information Systems
IT Support at Different Organizational Levels
Managing Information Technology in Organizations
Information
Infrastructure
Architecture
Traditional
Architectures
New
Organizational
Structure
Corresponding
Information
System
Transaction
Processing
Systems
Management
Information
Support
Managers
Knowledge
Workers
Clerical
Staff
Which resources
are managed by
whom?
What is the role
of the information
systems department?
Who runs the ISD
and to whom does
the department report?
What are the
relationships between
ISD and end users?

4. Case : Burlington Coat Factory
The Business Problem
Burlingion is the largest retailer of coats in the United States
sells clothes, linens, luggage, jewelry, baby furniture and accessories
faces extremely strong competition
wants to offer up to 60% off department store prices
needs information to respond to demand
needs to communicate and collaborate with both store mangers and suppliers quickly and effectively

5. Case (continued…) The Solution The Results
a corporate computer-based communication system
networks to a main processor
transfers sales data by satellite technology
executes routine transactions on the headquarters’ computer
feeds information from the corporate databases into spreadsheets or word processors on desktop computers for end-user computing and decision support
The Results
dramatic decrease in communication problems
steady increase in sales volume and profits

6. Case (continued…) What have we learned from this case??
Characteristics of a networked corporate information system that are usually found in organizations
several different information systems exist in one organization
some of these systems may be completely independent, but most are interconnected
information systems are connected by means of electronic networks
the information system is composed of large and small computers and other hardware connected by different types of networks
many information systems use client/server architecture

7. Information Systems Architecture
Physical facilities, hardware, software, databases services, and management that support all computing resources in an organization
Five major components of infrastructure
computer hardware
general-purpose software
networks and communication facilities
database
information management personnel
Tells how specific computing resources are arranged, operated, and managed

8. Information Systems Architecture (continued …)
Information Architecture
a high-level map or plan of the information requirements
a manner in which these requirements will be satisfied
a guide for current IT operations
a blueprint for future IT directions
meets the organization’s strategic business needs
must tie together the information requirements, the infrastructure, and the applications
similar to the conceptual planning of a house

9. Information Systems Architecture (continued …)
Traditional Architectures
mainframe environment
processing is done by a mainframe computer - a relatively large computer built to handle large amounts of data, thousands of user terminals, and millions of transactions
modern versions of this architecture : personal computers (PCs) and network computing (NC)
PC environment
PCs form the hardware architecture
distributed environment
divides the processing work between two or more computers
the participating computers can be all mainframe, all PCs, or (usually) a combination of the two

10. Information Systems Architecture (continued …)
New Architectures
client/server architecture
several computers share resources and are able to communicate with many other computers
a client - a computer such as a PC attached to the network, which is used to access shared network resources
a server - a machine that is attached to the same network and provides clients with these services
purpose : optimize the use of computer resources

11. Information Systems Architecture (continued …)
Enterprisewide Architectures
access to data, applications, services, and real-time flows of data in different LANs or databases
use client/server architecture to create a cohesive, flexible, and powerful computing environment
provide total integration of departmental and corporate IS resources
increase the availability of information and thereby maximize the value of an organization

12. Information Systems Architecture (continued …)
Internet-based Architectures
based on the concepts of client/server architecture and enterprisewide computing
the Internet is the basis for a network connection from the outside world to the company, as well as with the organization’s web site
organization’s internal private Internet (intranet) - useful for distributing information throughout the organization

13. The network organization:
Non-Company Manufacturers
Customers
Sales peoples and other mobile employees
Distributors
Market
Non-Company Retailers
Suppliers (Purchasing)
Liquidators
contractors
Toy Industry Extranet
Other Extranets
Banks and other
business partners
Professional Associations, large suppliers, competitors
Corporate
Extranet
Head Quarter
Retail Stores
Employees
Manufacturing
Toys Inc
Corporate Intranet
Public
Travel agency
Small customers
Small retailers
Small vendors
Government
EDI, VAN
Internet
The network organization:
How a company uses the Internet, intranet and extranet

14. Organizations : Structure and IT Support
the nature of organizations determines their activities, the information support they need, and the type of information systems they use
profit-making business versus not-for-profit organizations exist
manufacture goods versus services are delivered
can be located in one place or in several places, some are global or multinational organizations

15. Organizations : Structure
Organizational Structure
departmental functional structure
specialize in the delivery of a certain function
typical departments in an organization:
Accounting
Finance
Marketing and Sales
Production or Operations Management (POM)
Human Resources Management (HRM)
Information Systems and Technology

16. Organizations : Structure
Hierarchical Structure
Headquarters
Division A
Division B
Overseas
Division
Plant C
Plant D
Plant E
Plant F
POM
Accounting
Marketing
Finance
HRM
Administration
Services
(legal, etc.)

17. Organizations : IT Support
The Corresponding Information Systems
Departmental Information Systems
Plant Information Systems
Divisional Information Systems
Enterprisewide Information Systems
Interorganizational Information Systems (IOS)
Global Information System for an International or Multinational Corporation

18. Types of Information Systems
Transaction Processing Systems
organizations perform routine, repetitive tasks
a TPS supports the monitoring, collection, storage, processing, and dissemination of the organization’s basic business transactions
frequently, several transaction processing systems exist in one company
today’s transaction processing systems are much more sophisticated and complex

19. Types of Information Systems (continued …)
Management Information Systems (MIS)
provides periodic reports
generates weekly and monthly summaries by product, customer, or salesperson
initially, MIS had an historical orientation
today, MIS reports may include summary reports, for the current period or for any number of previous periods - used for monitoring, planning, and control
functional management information systems (MIS)
access, organize, summarize, and display information for supporting routine decision making in the functional areas
geared toward middle managers

20. Types of Information Systems (continued …)
Major Outputs of a Functional Management Information System
OUTPUT
DESCRIPTION
Statistical summaries
Summaries of raw data such as daily production, and weekly and monthly usage of electricity.
Exception reports
Highlights of data items that are larger or smaller than designated levels.
Periodic reports
Statistical summaries and exception reports provided at scheduled, regular periods.
Ad hoc reports
Special, unscheduled reports provided on demand.
Comparative analysis
Performance comparison to that of competitors, past performance, or industry standards.
Projections
Advance estimates of trends in future sales, cash flows, market share, etc.

21. Types of Information Systems (continued …)
Support Systems
office automation systems (OAS)
word processing systems
computer-aided design and manufacturing (CAD/CAM)
decision support systems (DSS)
end-user computing
executive information systems (EIS)
group support systems (GSS)
Intelligent Systems
expert systems (ES)
artificial neural network (ANN)

22. Types of Information Systems (continued …)
Integrating Systems
various computerized systems are being integrated to increase their functionalities
one popular form of integrated system is enterprise resources planning (ERP)
ERP plans and manages all of an organization’s resources and their use, including contacts with business partners

23. The Evolution Computer Based Information Systems 1940
Scientific, military applications
1950
Routine business applications, TPS
1960
MIS, office automation
1970
DSS, LANs
1980
Client/server executive information system,
PC’s, AI, Groupware
1990
Integration, intelligent systems
the Web, intranets, extranets, ERP software
2000
Internet, Electronic commerce, Smart systems

24. IT Support at Different Organizational Levels
Office Automation and Communication Systems
Clerical Staff
Operation Systems
Line Managers, Operators
Managerial Systems
Middle Managers
Staff Support
Knowledge Workers, Professionals
Strategic
Systems
Top Managers
Information Infrastructure and TPS
The information systems support of people in organizations

25. Knowledge Workers
People who create information and knowledge and integrate it into the business
Engineers, financial and marketing analysts, production planners, lawyers, and accountants
Responsible for finding or developing new knowledge for the organization and integrating it with existing knowledge
Act as advisors and consultants to the members of the organization
Act as change agents by introducing new procedures, technologies, or processes
60 to 80 percent of all workers are knowledge workers
Supported by a large variety of information systems from Internet search engines to expert systems, to computer-aided design, and by knowledge bases

26. Clerical Staff Support managers at all levels
Data workers - use, manipulate, or disseminate information
bookkeepers, secretaries who work with word processors, electronic file clerks, and insurance claim processors
Supported by office automation and groupware, including document management, workflow, , and other personal productivity software

27. IT Support at Different Organizational Levels : A Summary
System
Employees Supported
Detailed Discussion in
Office automation
Office workers
Chapter 7, 9
Communication
All employees
Chapter 6, 8
Group support system
People working in groups
Chapter 10
Decision support system
Decision makers, managers
Chapter 10
Executive information
Executives, top managers
Chapter 10
TPS
Line managers and employees
Chapter 9
MIS
Middle management
Chapter 9
Intelligent systems
Knowledge workers
Chapter 11

28. Managing IT Resources
IT resources are scattered throughout the organization
Information systems have enormous strategic value
Some IT resources change frequently. It may be rather difficult to manage IT resources
It is essential to manage information systems properly
The responsibility for the management of information resources is divided between a usually centralized information systems department (ISD) and the end users
Which resources are managed by whom?
Generally speaking, ISD is responsible for corporate-level and shared resources, and the end users are responsible for departmental resources

29. Managing IT Resources (continued …)
What is the role of the information systems department?
Traditional major IS functions:
Managing systems development and systems project management
Managing computer operations, including the computer center
Staffing, training, and developing IS skills
Providing technical services

30. Managing IT Resources (continued …)
What is the role of the information systems department? (continued)
New (additional) major IS functions:
Initiating and designing specific strategic information systems
Infrastructure planning, development, and control
Incorporating the Internet and electronic commerce into the business
Managing system integration including the Internet, intranets, and extranets
Educating the non-IS managers about IT
Educating the IS staff about the business
Supporting end-user computing
Partnering with the executive level that runs the business
Actively participating in business processes reengineering
Proactively using business and technical knowledge to the line with innovative ideas about IT
Creating business alliances with vendors and IS departments in other organizations

31. Managing Information Technology
Key MIS issues in two recent time periods
Key Issues, 1994/1995
Key Issues, 1997
1. Building a responsive IT infrastructure
1. Improving productivity
2. Facilitating and managing business process redesign
2. Reducing costs
3. Developing and managing distributed systems
3. Improving decision
making
4. Developing and implementing
an information architecture
4. Enhancing customer relationships
5. Planning and managing communication networks
5. Developing new
strategic applications

32. Managing Information Technology (continued …)
Who Runs the ISD and to whom does ISD Report?
run by MIS Director, Manager of Computing Services, Manager of Information Technology, or Chief Information Officer (CIO)
reports to
Chief Executive officer
Functional Vice President
Senior vice president
Chief knowledge officer (CKO) - the director assigned to capture and make effective use of IT knowledge for an organization
The executive committee provides the top-level oversight for the organization’s information resources. It guides the IS steering committee, which is usually chaired by the CIO.

33. Managing Information Technology (continued …)
What are the relationships between the ISD and end users?
A steering committee that represents all end users and the ISD. This committee sets IT policies, decides on priorities, and coordinates IS projects.
Joint ISD/end-user project teams for planning, budgeting, applications development, and maintenance
ISD representation on the top corporate executive committee
Service agreements that define computing responsibilities and provide a framework for services rendered by the ISD to end users
Technical and administrative support (including training) for end users
A conflict resolution unit established by the ISD to handle end-user complaints quickly and resolve conflicts as soon as possible
An information center that acts as help center to end users regarding purchase, operations, and maintenance of hardware and software

34. What’s in IT for Me? For Accounting For Finance For Marketing
Many of the transactions handled in a TPS are data that the accounting department records and tracks
For Finance
Financial departments often use specialized DSS for forecasting and portfolio management
For Marketing
Marketing uses such IT-related concepts as customer databases, marketing decision making, sales automation, and customer relationship management (CRM)

35. What’s in IT for Me? (continued …)
For Production/Operations Management
Organizations are competing on price, quality, time (speed), and customer service which are enhanced and supported by IT
For Human Resources Management
Intranets help to disseminate relevant information throughout the organization. Internets are used for recruiting
For MIS
IS management function continues to grow in strategic value
For Non-Business
In all organizations, IT provides essential support to all functional areas`