1. 3.1 3 3 INFORMATION SYSTEMS, ORGANIZATIONS, MANAGEMENT, AND STRATEGY Chapter

2. 3.2 ORGANIZATIONS AND INFORMATION SYSTEMS Figure 3-1 Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy MEDIATING FACTORS: Environment Culture Structure Standard Procedures Politics Management Decisions Chance ORGANIZATIONS INFORMATION TECHNOLOGY The Two-Way Relationship Between Organizations and Information Technology

3. 3.3 Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy COMMON FEATURES OF ORGANIZATIONS The Behavioral View of Organizations Figure 3-3

4. 3.4 All organizations have different: Structures/Organizational typesStructures/Organizational types GoalsGoals ConstituenciesConstituencies Leadership Styles, TasksLeadership Styles, Tasks Surrounding EnvironmentSurrounding Environment Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy ORGANIZATIONS & INFORMATION SYSTEMS Unique Features of Organizations

5. 3.5 Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Figure 3-4 Organization and Its Environment ORGANIZATIONS & INFORMATION SYSTEMS

6. 3.6 Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Figure 3-5 THE CHANGING ROLE OF INFORMATION SYSTEMS IN ORGANIZATIONS Information Technology Services

7. 3.7 THE CHANGING ROLE OF INFORMATION SYSTEMS IN ORGANIZATIONS Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Includes specialists: Programmers: Highly trained, write softwareProgrammers: Highly trained, write software Systems analysts: Translate business problems into solutions, act as liaisons between the information systems department and rest of the organizationSystems analysts: Translate business problems into solutions, act as liaisons between the information systems department and rest of the organization Information Technology Infrastructure and Information Technology Services

8. 3.8 THE CHANGING ROLE OF INFORMATION SYSTEMS IN ORGANIZATIONS Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Specialists (cont.): Information system managers: Leaders of various specialistsInformation system managers: Leaders of various specialists Chief information officer (CIO): Senior manager in charge of information systems function in the firmChief information officer (CIO): Senior manager in charge of information systems function in the firm End users: Department representatives outside the information system department for whom applications are developedEnd users: Department representatives outside the information system department for whom applications are developed Information Technology Infrastructure and Information Technology Services

9. 3.9 Economic theories Information technology is a factor of production, like capital and laborInformation technology is a factor of production, like capital and labor Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy THE CHANGING ROLE OF INFORMATION SYSTEMS IN ORGANIZATIONS How Information Systems Affect Organizations

10. 3.10 Transaction cost theory: Firms can conduct marketplace transactions internally more cheaply to grow larger Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy THE CHANGING ROLE OF INFORMATION SYSTEMS IN ORGANIZATIONS How Information Systems Affect Organizations

11. 3.11 Transaction Cost Theory Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Figure 3-6 THE CHANGING ROLE OF INFORMATION SYSTEMS IN ORGANIZATIONS

12. 3.12 Agency theory: Firm is nexus of contracts among self-interested parties requiring supervisionAgency theory: Firm is nexus of contracts among self-interested parties requiring supervision Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy THE CHANGING ROLE OF INFORMATION SYSTEMS IN ORGANIZATIONS How Information Systems Affect Organizations

13. 3.13 Agency Cost Theory Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Figure 3-7 THE CHANGING ROLE OF INFORMATION SYSTEMS IN ORGANIZATIONS

14. 3.14 Behavioral theories: Information technology could change hierarchy of decision makingInformation technology could change hierarchy of decision making Lower cost of information acquisitionLower cost of information acquisition Broadens the distribution of informationBroadens the distribution of information Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy THE CHANGING ROLE OF INFORMATION SYSTEMS IN ORGANIZATIONS How Information Systems Affect Organizations

15. 3.15 Virtual organization: Task force networked organizationsTask force networked organizations Uses networks to link people, assets, and ideas to create and distribute products and services without being limited to physical locationsUses networks to link people, assets, and ideas to create and distribute products and services without being limited to physical locations Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy THE CHANGING ROLE OF INFORMATION SYSTEMS IN ORGANIZATIONS How Information Systems Affect Organizations

16. 3.16 Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Decisions are classified as: Unstructured: Non routine, decision maker provides judgment, evaluation, and insights into problem definition, no agreed-upon procedure for decision makingUnstructured: Non routine, decision maker provides judgment, evaluation, and insights into problem definition, no agreed-upon procedure for decision making Structured: Repetitive, routine, handled using a definite procedureStructured: Repetitive, routine, handled using a definite procedure MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Managers and Decision Making

17. 3.17 Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy TPS OAS MIS KWS DSS ESS Organizational Level TYPE OF DECISIONOPERATIONALKNOWLEDGEMANAGEMENTSTRATEGIC STRUCTURED ACCOUNTS RECEIVABLE ELECTRONIC PRODUCTION SCHEDULING COST OVERRUNS SEMI-BUDGET STRUCTUREDPREPARATION PROJECT SCHEDULING FACILITY LOCATION UNSTRUCTUREDPRODUCT DESIGN NEW PRODUCTS NEW MARKETS Figure 3-9 MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Different Kinds of Information Systems

18. 3.18 Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Figure 3-10 MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Decision-Making Process

19. 3.19 Rational: People, organizations, and nations engage in consistent, value- maximizing calculations or adaptations within certain constraintsRational: People, organizations, and nations engage in consistent, value- maximizing calculations or adaptations within certain constraints Cognitive style: Underlying personality dispositions toward the treatment of information, selection of alternatives, and evaluation of consequencesCognitive style: Underlying personality dispositions toward the treatment of information, selection of alternatives, and evaluation of consequences Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Models of Decision Making

20. 3.20 Systematic decision makers: Cognitive style,describes people who approach a problem by structuring it in terms of some formal methodSystematic decision makers: Cognitive style, describes people who approach a problem by structuring it in terms of some formal method Intuitive: Cognitive style, describes people approaching a problem with multiple methods in an unstructured mannerIntuitive: Cognitive style, describes people approaching a problem with multiple methods in an unstructured manner Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Models of Decision Making

21. 3.21 Organizational models of decision making: Consider structural and political characteristics of an organizationOrganizational models of decision making: Consider structural and political characteristics of an organization Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Models of Decision Making

22. 3.22 Factors to consider while planning a new system: Organizational environmentOrganizational environment Organizational structure, hierarchy, specialization, standard operating proceduresOrganizational structure, hierarchy, specialization, standard operating procedures Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Implications for the Design and Understanding of Information Systems

23. 3.23 Culture and politics of the organizationCulture and politics of the organization Type of organization and its style of leadershipType of organization and its style of leadership Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Implications for the Design and Understanding of Information Systems

24. 3.24 Groups affected by the system and the attitudes of workers who will be using the systemGroups affected by the system and the attitudes of workers who will be using the system Kinds of tasks, decisions, and business processes, information system is designed to assistKinds of tasks, decisions, and business processes, information system is designed to assist Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Implications for the Design and Understanding of Information Systems

25. 3.25 Characteristics to be kept in mind while designing systems: Flexibility and multiple options for handling data and evaluating informationFlexibility and multiple options for handling data and evaluating information Capability to support a variety of styles, skills, and knowledgeCapability to support a variety of styles, skills, and knowledge Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Implications for the Design and Understanding of Information Systems

26. 3.26 Capability to keep track of many alternatives and consequencesCapability to keep track of many alternatives and consequences Sensitivity to the organization’s bureaucratic and political requirementsSensitivity to the organization’s bureaucratic and political requirements Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy MANAGERS, DECISION MAKING, AND INFORMATION SYSTEMS Implications for the Design and Understanding of Information Systems

27. 3.27 INFORMATION SYSTEMS AND BUSINESS STRATEGY Computer system at any level of an organizationComputer system at any level of an organization Changes goals, operations, products, services, or environmental relationshipsChanges goals, operations, products, services, or environmental relationships Helps organization gain a competitive advantageHelps organization gain a competitive advantage Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy What is Strategic Information System

28. 3.28 INFORMATION SYSTEMS AND BUSINESS STRATEGY Digital firms Manage the supply chain by building efficient customer “sense and response” systemsManage the supply chain by building efficient customer “sense and response” systems Participate in “value webs” to deliver new products and servicesParticipate in “value webs” to deliver new products and services Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Business Level Strategy and the Value Chain Model

29. 3.29 INFORMATION SYSTEMS AND BUSINESS STRATEGY Value Chain Model: Highlights the primary or support activities adding a margin of value to products or servicesHighlights the primary or support activities adding a margin of value to products or services Helps achieve a competitive advantageHelps achieve a competitive advantage Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Business Level Strategy and the Value Chain Model

30. 3.30 INFORMATION SYSTEMS AND BUSINESS STRATEGY Primary Activities: Directly related to the production and distribution of a firm’s products or servicesDirectly related to the production and distribution of a firm’s products or services Support Activities: Make the delivery of primary activities possibleMake the delivery of primary activities possible Consist of the organization’s infrastructure, human resources, technology, and procurementConsist of the organization’s infrastructure, human resources, technology, and procurement Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Business Level Strategy and the Value Chain Model

31. 3.31 Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy INFORMATION SYSTEMS AND BUSINESS STRATEGY Firm Value Chain Figure 3-11

32. 3.32 INFORMATION SYSTEMS AND BUSINESS STRATEGY Product Differentiation: Competitive strategyCompetitive strategy Creates brand loyalty by developing new and unique products and servicesCreates brand loyalty by developing new and unique products and services Products and services not easily duplicated by competitorsProducts and services not easily duplicated by competitors Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Business Level Strategy and the Value Chain Model

33. 3.33 INFORMATION SYSTEMS AND BUSINESS STRATEGY Focused Differentiation: Competitive strategyCompetitive strategy Enables development of new market niches for specialized products or servicesEnables development of new market niches for specialized products or services Helps businesses compete better than competitors in the target areasHelps businesses compete better than competitors in the target areas Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Business Level Strategy and the Value Chain Model

34. 3.34 INFORMATION SYSTEMS AND BUSINESS STRATEGY Efficient Customer Response System: Directly links consumer behavior back to distribution, production, and supply chainsDirectly links consumer behavior back to distribution, production, and supply chains Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Supply Chain Management and Efficient Customer Response System

35. 3.35 INFORMATION SYSTEMS AND BUSINESS STRATEGY Switching costs: Expense incurred by a customer or company in terms of time and expenditure of resources when changing from one supplier or system to anotherExpense incurred by a customer or company in terms of time and expenditure of resources when changing from one supplier or system to another Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Supply Chain Management and Efficient Customer Response System

36. 3.36 Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Figure 3-13 INFORMATION SYSTEMS AND BUSINESS STRATEGY Stockless Inventory Compared to Traditional and Just-in-time Supply Methods

37. 3.37 INFORMATION SYSTEMS AND BUSINESS STRATEGY Core Competency: Activity at which a firm excels as a world- class leaderActivity at which a firm excels as a world- class leader Information system encouraging the sharing of knowledge across business units enhances competencyInformation system encouraging the sharing of knowledge across business units enhances competency Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Firm-Level Strategy and Information Technology

38. 3.38 INFORMATION SYSTEMS AND BUSINESS STRATEGY Information partnership: Cooperative alliance formed between two or more corporations for sharing information to gain strategic advantageCooperative alliance formed between two or more corporations for sharing information to gain strategic advantage Help firms gain access to new customers, creating new opportunities for cross- selling and targeting productsHelp firms gain access to new customers, creating new opportunities for cross- selling and targeting products Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Industry-Level Strategy and Information Systems

39. 3.39 INFORMATION SYSTEMS AND BUSINESS STRATEGY The competitive forces model: Describes the interaction of external influences, specifically threats and opportunities, affecting an organization’s strategy and ability to competeDescribes the interaction of external influences, specifically threats and opportunities, affecting an organization’s strategy and ability to compete Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Industry-Level Strategy and Information Systems

40. 3.40 Essentials of Management Information Systems Chapter 3 Information Systems, Organizations, Management, and Strategy Figure 3-15 INFORMATION SYSTEMS AND BUSINESS STRATEGY Porter’s Competitive Forces Model

41. 3.41 3 3 INFORMATION SYSTEMS, ORGANIZATIONS, MANAGEMENT, AND STRATEGY Chapter