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Chapter 3 Organizational Strategy and
Information Systems
Jason C. H. Chen, Ph.D.Professor of MIS
School of Business AdministrationGonzaga UniversitySpokane, WA 99258
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
Who/What Delivers IT Value?
IT Value is a function of ______, ______, and _________.
________
___________
IT Value is also a function of
___________ value.
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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MIS and Management Roles
DataInformation
__________roles
__________Based roles
________- related roles
Seeks and receives Specific information
Transmits information To employees, managers,etc. Transmits information To vendors, customer, etc.
Initiates improvements Supervises projects Allocates and approves Resources Represents the firm in Settling disputes
Figurehead
Leader
Liaison
Very easy role No major decision making Or information processing
Most significant; judging, Promoting, monitoring, training “Give-and-take” relationships
Monitor
Facilitator
Spokesperson
EntrepreneurProblemSolverResourceAllocatornegotiator
________ _______
MIS/IS
Management Roles Description
ActionableResults
ActionableResults
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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Organizational Ware
OrganizationalWare
HW
SW
N
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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IS/IT Strategy
How it can be delivered?
N
Business (Firm)Strategy
Where is the business going and why?
Why Organization Strategy?
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
Learning Objectives• Understand how the use of information technology
impacts an organization.• Identify the type of organizational structure that tends to
be most willing to embrace technological change and sophistication.
• List the advantages and disadvantages of the networked organizational structure.
• Discuss how IT has changed the way managers monitor and evaluate
• Define and explain the concept and importance of virtual organizations.
• Identify the challenges that are faced by virtual teams.
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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Hierarchical Flat Matrix Networked
Description
Characteristics
Type of Environment Best Supported
Basis of Structuring
Power Structure
Key Tech. Supporting this
Bureaucratic w/ defined levels of management
Division of labor specialization, unity of command
StableCertain
Primary function
Centralized
Mainframe, centralized data and processing
Decision-making pushed down to lowest level
Informal roles, planning and control; often sm.,young orgs.
UnstableUncertain
Primary function
Centralized
Personal computers
Workers assigned to 2 or more supervisors
Dual reporting based on function/purpose
UnstableUncertain
Functions and purpose
Distributed
Networks
Formal/informal communication networks that connect allKnown for flexibility and adaptability
UnstableUncertain
Networks
Distributed
Intranets and Internet
Figure 3.4 Comparison of Organizational Structures
Traditional
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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Other Organizational Structures
• An organization is seldom a pure form of one of the four structures described above (i.e., hierarchical, flat, matrix and networked).
• It is more common to see a hybrid structure in which different parts of organization use different structures depending on their information needs and desired work processes.
• Adaptive or _____ time organization– a newer organizational design is designed to be highly
flexible, agile and responsive so that __________ can be configured quickly to respond to changing _________ .
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
IS and Organizational Design
• IS in the organizational designs:– Defines the flow of information throughout the organization.– Facilitate management control at the organizational and
individual levels.
• Culture impacts IS and organizational performance. • IS in the organization’s physical structure is designed
to facilitate the ___________ and work ______ necessary to accomplish the organization’s goals.
• The organization structures of Cognizant and TCS, while very different, reflect and support the goals of each company.
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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What is Organization Transformation?
• Organization transformation is a comprehensive organization-wide change initiative that results in change in the “deep structure” of the firm, _______ altering strategy, structure, systems, processes, human resource requirements, and core values and beliefs.
• With the overall change initiative resulted in radical change, the implementation process proceeded through overlapping episodes of ______ and radical change consistent with the change process.
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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Dilemma in Organization Design
Complex
Simple
Organization
StableCertain
Environment DynamicUncertain
???
Hierarchy(_______)
Entrepreneurial(________)
NN
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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The IT Design Challenge Parallels the Organization Design Challenge
Complex
Simple
Organization
EnvironmentStableCertain
DynamicUncertain
“Centralized Intelligence”Mainframe
(Control) 1960s, 1970s
“Decentralized Intelligence”Microcomputer
(Autonomy) 1980s
Main Frame
“Networked Intelligence”(Collaboration/ _______) 1990s and beyond
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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The Emerging Information Age Organization
Complex
Simple
Organization
EnvironmentStableCertain
DynamicUncertain
Hierarchy
Autonomy
Entrepreneurial
Collaboration(commitment)
LearningFlexibility
Standardization
__________________
Supervision(compliance)
______ _________
Sharedunderstanding
Shared
purpose
Information
________
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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Transitions in Organization Design
• From Control to _____________– Promote flexibility, creativity, and learning while
continuing to enable tight control of operating process
• From Autonomy to _____________– Line mangers are empowered to make decisions– Timely, quality distributed information and new
communication technologies (e.g., video conferencing) are important factors that are enabling dramatic changes in organization redesign.
TM -14Dr. Chen, Information, Organization, and Control TM -14
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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The Organization Design Challenge
• _________: centralized intelligence control– complex organization in stable environment– mainframe
• ________: autonomy decentralized intelligence– simple organization in dynamic environment– microcomputer
• ____________: distributed intelligence collaboration– complex organization in dynamic environment– networked IT architecture – flat, fast, flexible and focused on areas of core competency
Dr. Chen, Information, Organization, and Control TM -15
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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Lessons of the Information Age Organization Design
• _______ counts, but not at the expense of control.• Empowerment is not _______.• Transforming an organization requires more than
just changing the structure.– Maximizing flexibility, innovation, and control.– Maximizing independence and interdependence:
collaboration, the missing organization design criterion.– Organization transformation needs a comprehensive
organization-wide change initiative that results in change in the “deep structure” of the firm, radically altering strategy, structure, systems, processes, human resource requirements, and core values and beliefs.
NN
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
Social Network• Computer and information technologies facilitate
____________ across distances, social networks and virtual communities are formed.
• Useful in getting a job done, even if not all of the members of the network belong to the same organization. (i.e. LinkedIn)
• Social network is– an ___-enabled network that links individuals together
in ways that enables them to find experts, get to know colleagues, and see who has relevant experience for projects across traditional organization lines.
– a form of _________ network
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
INFORMATION SYSTEMS AND MANAGEMENT CONTROL SYSTEMS
• IT changes the way Managers _______.• IT changes the way Managers Evaluate.• IT changes the way Managers Provide
Feedback.• IT changes the way Managers ________
and _______.• IT changes the way Managers Control
Processes.18
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices19
CULTURE
• Culture is the third managerial lever.• Plays an increasingly important role in IS
development and use.• It is defined as a shared “set of _______ and
_______about what is desirable and undesirable in a community of people” (also see TAM model in chapter 4).
• Culture is not static but always changing.• Different levels of culture.• Culture should be considered as the most important
organizational ________ resources for improving its competitive advantage as it is non- ___________
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
ITVision/
ITStrategy
StrategicVectors
Business Strategy
BusinessVision
Technology Concepts• Standards• Protocols• Performance• Compatibility• Guidelines
Key Issues• Operating System• Data Bases• Applications• Communications• Processors
_________Management
_________Management
IT____________
Technology Selection• Hardware• Software
Fig. 3 (Extra): IT Architecture and Strategic Business Vision
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices
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• The power of Is department now and the future will come from _______, influence and capability - and less from control.
• The measure of success of the IS will no longer be numbers of people but contributions to the business - ______, speed, products/services, and _______.
• The roadblock to competitive advantage generally is not technology, but ___________ - with people.
• Successful implementation requires working closely with line people. Thus IS departments need to establish better relationships with outside organizations, senior management, and users.
Conclusions
TM -21Dr. Chen, Information, Organization, and Control