Information Systems in Organizations

Information Systems and Management

Introduction

Businesses need to ensure that systems:

Lower Costs Increase Profits Improve ServiceAchieve a competitive

advantage

IS personnel are the key to unlocking the potential of any new or modified system

(HBO)

• In your career you will work with information systems to help your company become more efficent, effective, productive, and competitive within its industry.

Organization

An organization is a formal collection of people and other resources established to accomplish a set of goals.

Value Chain

The Value Chain is a series of activities that includes:– Inbound logistics– Warehouse & Storage– Production– Finished product storage– Outbound logistics– Marketing & Sales– Customer Service

Organizational Structure

Organizational Structure

Organizational subunits and the way they relate to the overall organization.

Types of Organizational Structures

•Traditional

•Flat

•Project

•Team

•Multi-Dimensional

•Virtual

http://www.evektor.cz/evektor/images/organisation_chart_EN.gif

Empowerment

Giving employees and their managers more responsibility and authority to make decisions, take certain actions, and have more control over their jobs.

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Organization Structure and IS

IS Department Functions

Technical• Operating Systems• Telecommunications• DBA

Systems & Programming

Training•Internal•External

Audit

Business Process Reengineering (BPR)

BPR

The radical redesign of business processes

• Technology

• TQM

Technology

• Diffusion: Measure of how widely technology is spread throughout the organization

• Infusion: Extent to which technology is deeply integrated into a business area

• Technology Acceptance Model (TAM): a model that describes the factors that lead to higher levels of acceptance and usage of technology.– Factors include ease of use and quality of

information

Total Quality Management (TQM)

• Quality: the ability of a product or service to meet or exceed customer expectations

• TQM: approaches that foster a commitment to quality– Awareness of customer needs– Empowering and rewarding employees

for quality

Information System Success

Efficiency

- Output / Input

- Do things right

Effectiveness

- Output / Objectives

- Do the right things

More BPR

• The fundamental re-thinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, service, and speed.

• Automate: IT substitutes for human effort– Payroll (same but faster)

• Informate: IT augments human effort– Spreadsheets (new activities)

• Transformate: IT restructures processes– Paperless Accounts Payable

BPR – Revolutionary

TQM - Evolutionary

“Don’t pave the cow paths”

Strategies to Contain Costs

• Outsourcing: contracting with outside professional services to meet specific business needs

• On-Demand Computing (Utility Computing):

contracting for computer resources to rapidly respond to an organizations

varying workflow (Cloud)

• Downsizing (Rightsizing):

reducing the number of employees to cut costs

Porter’s Five Forces Model

Factors that lead to attainment of competitive advantage

Porter’s Five Forces Model

&Information Technology

1. Buyer Power Decrease buyer power Make it more attractive for

customers to buy from us IT

Loyalty Program Safeway VS. Save-On-Foods Aeroplan

From a Company Perspective

2. Supplier Power Decrease supplier power Have many alternate supply

sources IT

B2B Marketplace Internet-based services

which brings together many buyers and sellers

Private Exchange

3. Threat of Substitute Product or Services Decrease the threat Have fewer alternatives in the

market IT

Create switching costs

4. Threat of New Entrants Decrease the threat Create an entry barrier IT

5. Rivalry among Existing Competitors Trend is toward increased competition IT

Gain a competitive advantage (fleeting) Compete on price Track Purchasing sequences

Strategic Planning for Competitive Advantage

Strategic Alliance:

Agreement between two or more companies that involves the joint production and distribution of goods and services.

• Creating new products and services• Improving existing products and

services• Using IS for strategic purposes

Planning

ISOrganizing

Controlling Staffing

Directing

Chief Information Officer (CIO)

• Oversees all uses of IT

• Ensures strategic alignment of IT with business goals and objectives

Discussion Question

Business Personnel and IT Personnel

There is a GAP• What is this gap?

• Why does it exist?

• How may it be resolved?

Information Systems in Organizations

Information Systems and Management