Chapter 15: Managing Global Systems

The world just keeps getting smaller and smaller. We must adapt to changing faces, literally, of our competition and devise a plan to bring our organizations into its view. Globalization is possible even with very small businesses because of the technological advances in computer networks and telecommunications.

Perhaps the most important challenge facing corporations and companies wanting to open foreign markets is that of the global culture. We’re beginning to share more culture because of increased telecommunications and the Internet. However, when you are merging two entities, one domestic and one foreign, into one business, the culture of that merged organization can be an important influence on how well the company does.

Advanced telecommunications systems now allow companies to work around the clock and around the world. Companies may choose to locate parts of their corporate offices in other countries because they fit better with the corporation’s overall global strategy in that location.

Global businesses must devote their time and attention to understanding the cultures of countries in which they want to do business. Not only must they merge their business units, they must also merge their people into a cohesive team.

If you thought building an information system for an organization doing business only in the U.S. was tough, then think about how difficult it is to mesh a system built on 1990’s technology with one that was built in the 1980’s and one built in 2012.

First you decide what you’re going to do; choose a strategy. Then you have to organize your business around this strategy. The last step is to build the system that will incorporate the first two. There are four main global strategies that businesses can use to organize their global efforts:  domestic exporter, multinational, franchiser, and transnational. The global strategy will help determine the information system structure.

A company must decide how its business processes are divided among global, regional, and local units. Which location does each process better than the other? Carefully analyze each task and all available resources to support the process in each location. It may be surprising to learn that it’s cheaper and more efficient to store manufactured goods separately from where they are produced.

As technology continues to make our world smaller, companies must continually adapt both domestically and around the world.  Creating and manufacturing goods and services around the world and selling those same products and services anywhere in the world is a huge draw for many companies that see their domestic markets stagnate or shrink.

Management’s biggest task is to manage the changes that must take place in a global company. The changes are more difficult and complex because of the added characteristics of politics, culture, and language.

So…….why do companies even attempt to build themselves into global merchants? Because the potential payoff can be enormous!

Chapter 14: Managing Projects

Just as you can analyze the benefit of purchasing a new piece of equipment for your business, you can analyze the impact of an information system. Questions to ask: Just how will it benefit the business overall? What benefits will your customers gain from the new system?

However, you can’t reduce everything to dollars and cents. Sometimes the benefits of the new system will be measured in other ways; you can use different methods to evaluate a new information system, just as you would a new storage system for widgets.

One of the more difficult choices to make when evaluating new systems is to determine the tangible benefits versus the intangible benefits. Example…When a financial institution must decide whether to offer online banking; it may evaluate the system using a method and determine that it will cost half a million dollars to implement. The immediate cost savings of not having employees deal directly with customers may be only $250,000. One might say that the new system is not worth the cost; the bank will lose $250,000. But the intangible benefits the bank customers may enjoy could potentially be worth a million dollars. In that case, the new system’s intangible benefits will far exceed the tangible benefits.

Potential new systems should be evaluated in terms of costs, tangible and intangible. All costs, hardware, software, and persware, should be included in the bottom line so that the organization can truly determine the gains, or losses, associated with the changes that will take place.

Now…just because a new system proposal looks good on paper, meets the financial model requirements, shows positive tangible and intangible benefits, and is approved by senior management, doesn’t mean it will be a success. Sometimes design, data, cost, and operations known as potential system failures can deter progress.

Ever heard the saying “If it’s too good to be true, it probably is.” If the implementation team make the project details and scope seem easy and cheap, that’s too good to be true. If the techies tell you that it will be a piece of cake, you might want to dig deeper. If the non-techies say they don’t have anything to worry about, you may want to worry.

You have to anticipate problems and be ready to solve them. No system yet designed has been problem-free. When you understand and accept that implementing a new information system shouldn’t be that different from implementing any other type of new system, you utilize some of the same principles to guide you through the process.

Communicate, communicate, communicate, up and down the chain of command. Just because you don’t tell anybody, the bad news won’t go away.

Managing the change in the organizational structure that results from implementing a new system is as important as managing the system itself. Use the appropriate internal and external integration tools to control the risk factors. Design the system implementation with the whole organization in mind allowing mostly for the human factor.

Chapter 13: Building Information Systems

It would be nice if we could have a precise checklist of how to establish an e-commerce organization design plan, but we can’t. No one can. This chapter provides information that can be used to help plan and analyze organization changes for e-commerce and other areas.

The triangle is back…..Hardware, Software, and Persware. All three elements will pose their own unique challenges to managers. Successfully reorganizing the company relies on more than just bringing in new equipment and new programs. Understanding and incorporating the social and political climate in any plan is one of the most important aspects.

Too many companies buy the hardware they think is necessary for a new or improved information system. Then they purchase some software to go along with the new hardware. Now they realize their hardware is inadequate for the new software, so they buy more hardware. The vicious cycle continues.

The problem is that too many companies don’t have a plan for integrating new hardware and software purchased into their overall business plan, let alone meshing them with the persware side of the triangle. The information plan should support the overall business plan and not conflict with it. The plan must include all levels of the organization, including the strategic and executive levels.

Business Systems Planning (BSP), uses the “big picture” approach. You look at the overall organization and figure out how each unit, each function, all the processes, and each data element fits in; like a jigsaw puzzle. The biggest drawback to BSP is that it only asks questions about current processes and current uses of information; this is not enough for integrating e-commerce and new technologies.

Change is hard on people and organizations. But it’s one of those necessary evils that keep companies in the lead or helps destroy them. The most common forms of organizational change are automation and rationalization. These relatively slow-moving and slow-changing strategies present modest returns with little risk. Reengineering and paradigm shifts are faster and more comprehensive changes that carry high rewards with substantial chances of failure.

Systems development includes every resource and every step that goes into producing an information system that solves problems or helps organizations take advantage of new opportunities. Structured and Object-Oriented Methodologies are two designing systems that can be used in planning the systems.

Supply and demand…..the supply of technical specialist is not enough to support the demand for new systems, or maintenance of the old ones. Something has to fill the gap; this is why we see so many new and advanced methods on the market.

New methods of developing systems are continually being introduced. These new technologies:  rapid application development, joint application development, component-based development, and Web services are reducing the time, effort and cost for businesses and organizations of supplying employees, customers and suppliers with the information they need.

Chapter 12: Enhancing Decision Making

Each of us makes hundreds of decision every day. If just a fraction of those decisions could be improved through increased and better information and better processes, we’d all be delighted. Businesses feel the same way. Customers would be happier, employees would be more motivated, and managers would have an easier job. The more useful information you have, based on internal experiences or from external sources, the better your decisions.

Business decision making involves the following different levels of business:

·         Senior Management: makes long-term decisions based on internal and external information

·         Middle Management and Project Teams: decisions affect resources and short-range plans

·         Operational Management: decisions affect resources, schedules, and personnel

·         Individual employees: decisions affect vendors, employees, and customers

The different types of decisions made are: unstructured requiring judgment and insight into situations, structured which are repetitive with procedures, and semistructured that are a combination of the first two usually made by middle managers.

Stages of the decision-making process involves: intelligence and understanding the problem, design and exploring solutions to the problem, choice and choosing solution alternatives, and implementation that chooses the solution and monitoring how well it’s working.

Since we no doubt have had to make decisions in the real world, you know for a fact that the process is not as cut-and-dried as what we’ve discussed so far. Three reasons why the whole process can blow up at any moment: information quality is inaccurate, management filters are biased, and organization inertia occurs when people will do anything to keep the status quo.

The goal is to match the four decision-making levels along with the types of decisions to the appropriate kind of Decision Support System (DSS). DSS helps executives make better decisions by using historical and current data from internal information systems and external sources of data.

More and more, companies are turning to teams to get work done. Hours upon hours are spent in meetings, group collaborations, and communicating with many people. To help groups make better decisions, Group decision-support system (GDSS) was developed.

You’ve been there: a meeting where nothing was decided, people dominated the agenda, and some said nothing; it dragged on for hours. Companies have been struggling with this problem for years. They are now using GDSS to increase efficiency and effectiveness of meetings.

GDSS is more than hardware, it includes conference facilities, audiovisual equipment, and networking equipment that connects everyone. These electronic meeting systems allow people to review the agenda items in advance, information generated in the meeting is saved for future use, and because input is anonymous ideas are evaluated individually.

Making decisions can be difficult at best and managers used to rely on their instincts and best-guesses. Instead of guessing, managers and employees can now base decisions on facts and a more structured methodology thereby saving resources for the company.

Chapter 11: Managing Knowledge

Creating and using knowledge is not limited to information-based companies: it is necessary for all organizations, regardless of industry. It’s not enough to make good products; companies must make products that are better, less expensive to produce, and more desirable than those of competitors’. Using corporate and individual knowledge assets wisely will help companies accomplish this.

There are important dimensions to knowledge; there is more to information than just bits and bytes. A company must have the knowledge to transform information it gathers into meaningful concepts to improve the environment for its employees, suppliers, and customers. Wisdom is using information to solve problems and knowing how to apply knowledge.

Knowledge Management is referred to as the set of business processes developed in an organization to create, store, transfer, and apply knowledge. To understand the concept of knowledge management, think of knowledge as a resource, just like buildings, equipment, designs, and money. All these resources need to be actively managed.

In the knowledge management value chain, storing involves document management systems, knowledge acquisition uses data mining to gather information and knowledge application is about building new processes for its suppliers and employees or new products for its customers.

With so many sources of information and knowledge available, how does an organization go about collecting, storing, distributing, and applying it all? Organizations can create centralized knowledge repositories by building upon document management systems and including information from structured and semistructured knowledge systems. Companies save money by placing information pertaining to the subject matter experts in a directory that all employees can access.

Joe, a mechanic in Oklahoma, needs to fix a radiator in an old car. He can’t remember what bolts he needs. He uses his computer to access an intranet through the companies enterprise portal, clicks the type car, the type repair, and downloads the most current information to fix the part. He also has access to videos, warnings, best practices, and experiences from other mechanics. Instead of hours it might have taken Joe to look through a manual, he can finish the job in less than half a day.

Knowledge Work Systems (KWS) support the creation and integration of new knowledge that is beneficial to the organization. KWS are often used by and support professional employees such as engineers, researchers, and analysts. The requirements of a KWS include access to: graphic tools, analytical tools, communication tools, and document management tools. Examples of KWS are Computer-aided design (CAD) used to build new products or improve products, Virtual reality systems are sophisticated imagery that makes you feel like you’re right there, and virtual reality modeling language that has specifications for interactive 3-D modeling.

While managers will experience some challenges in implementing and using a Knowledge Management System, the benefits can be worthwhile. Start small, measure the ROI every step of the way, and make sure users are satisfied with the system or they won’t use it.

Chapter 10: E-commerce: Digital Markets, Digital Goods

About 20 years ago, the lines between an organization and its customers, suppliers, and partners were clear. A business wasn’t expected to make very much, if any, information available to anyone else outside the corporation. Production was totally separate from finance and the human resources division wasn’t connected to manufacturing. That is no longer the case in today’s business world. In order to remain competitive, businesses are expected, if not required, to make most, if not all, information available across all divisions and to the outside world.

To explain the changing economics of information, let’s say you’re ready to buy a car. You’ve checked the prices and information on various Web sites and secured a good deal because of your research. Now, you need a loan and insurance for the new car. Your bank loan seems high and your insurance agent’s rate also seems high. But wait. You check out the Web sites and find a better loan rate and better insurance rate. Because you were able to gather information from the Internet rather than traveling from business to business, your search costs were lower.

The bank and insurance company no longer had the advantage of information asymmetry; you had access to more information to compare pricing. The richness and reach of information on the Internet has allowed businesses and consumers to establish new types of relationships.

E-commerce is divided into three categories that distinguish the types of transactions that take place:

·         Business-to-consumer (B2C): most visible; involves retailing products to consumers.

·         Business-to-business (B2B): greatest dollar amount of transactions; sales of goods.

·         Consumer-to-consumer (C2C): greater geographic reach; consumers selling to consumers.

There are many products and services offered through traditional web sites, and as businesses continue to expand the reach of the Internet to wireless devices, they are creating new ways to offer products and services through handheld wireless devices known as mobile commerce or m-commerce.

The emerging digital company now has more opportunities to reach customers, suppliers, and partners through the Internet. The Internet has given digital companies the opportunity to create new business models or reshape current models. New models include: web portals like Google to track preferences and online retail stores called e-tailers used to check inventory and make orders.

Digital companies need money too, so various revenue sources have been explored – from running advertisements, such as, banner ads, to developing their own digital goods, like ebooks, special reports, even programs and web utilities. Most companies use a combination of the following revenue models: advertising, sales, subscription, transaction fee, and affiliate.

The last thing you want to do is throw up a web page, include an e-mail address, and call it done! You have to determine how your electronic commerce efforts will best fit your current business processes. Some companies have built a Web site without thinking through the entire process only to find out they have seriously hurt their normal operations.

Facts to remember: It’s not cheap, It’s not easy, it’s not fast.

Chapter 9: Achieving Operational Excellence and Customer Intimacy: Enterprise Applications

Over the last decade businesses have come to realize how important it is to totally integrate business processes across the enterprise. In today’s fast-paced world, managing information assets is more important than ever before. This chapter discusses how important it is for information to be available in every nook and cranny of an enterprise.

Done correctly, enterprise systems can offer big rewards; done incorrectly can cause a company huge headaches, loss of business, employee turmoil, and wasted dollars. Changes in an enterprise system can be tremendous:

·         A more uniform organization: more disciplined approach to business regardless of physical location or organization structure.

·         More efficient operations and customer-driven business processes: focus more on the customer.

·         Management: improved management decisions, a comprehensive view of performance.

Enterprise systems force a company to fully integrate all business processes. The changes helps the company automate many of the steps in the process instead of having to do everything manually.

Oh, for the days when the old saying “the customer is the king” was just a catch phrase. Now, it’s an absolute reality and companies that don’t live up to the phrase will pay for it. There are no more separate entities or distinct line in the sand when it comes to integrating supply chains. It’s more like shifting sand.

Supply chain planning systems can provide information up and down the chain and help everyone involved do a better forecasting job. It enables companies to: generate demand forecasts, develop sourcing and manufacturing plans, share information about changes easier and faster, coordinate activities with supply chain partners, and develop better demand planning.

The goals of Customer Relationship Management (CRM) Systems are to optimize revenue, profitability, customer satisfaction, and customer retention. Many companies are overloaded with data about customers. CRM systems are utilized to consolidate this information and then provide it to the customer touch points. By offering a consolidated viewpoint of the customer to these touch points; a company can cater to the customer that offers the most profitability.

Developing and using metrics to measure the effectiveness of implementing supply chain management systems is very important. One of the most important metrics is the customer lifetime value (CLTV). Again, the CLTV is information that helps determine the profitability of a customer.

The return on investment to companies that implement enterprise systems can be enormous in terms of better information to suppliers, employees, customers, and business partners. Management challenges will be a rough ride: daunting implementation, high up-front costs and future benefits, inflexibility, and realizing strategic value.

All the challenges of implementing a new enterprise system are directly related to people; many companies fail to understand this fact.

Chapter 8: Securing Information Systems

As companies become more technologically oriented, they must become more aware of SECURITY and control issues surrounding their information systems and protect the resources more stringently than ever before.

Information systems are vulnerable to technical, organizational, and environmental threats from internal and external sources. The weak link in the chain is poor system management. If managers at all levels don’t make security and reliability their number one priority, then the threats to an information system can easily become real.

It’s a difficult balancing act when it comes to making wireless systems easy to access and yet difficult to penetrate. Hackers can use war driving techniques to gain access to wireless networks not only in hotels and airports, but private businesses and government centers.

Malicious Software: viruses, worms, trojan horses, and spyware are malicious code that are spread through vulnerable internet-connected systems. If you connect to the Internet with a cable modem or DSL you are much more vulnerable to hackers on your home PC than if you connect with a dial-up modem. The only smart thing to do is keep your antivirus software up-to-date and include firewall protection.

One of the best ways to help prevent problems is to institute controls into your information system the same way you might in any other system; through methods, policies, and procedures.

Two distinct controls that will prevent problems is: general controls, which focus on the design, security and use of computer programs and data files, and application controls, which are concerned with the actual application programs.

Companies and government systems constantly use risk assessment to determine weak links in their physical building security. The same methodology can be used for the information system. Risk Assessments can be used to set up cost comparisons for developing and maintaining security against potential loss.

Because of the increasing liability for security breaches, many companies are now establishing a chief security officer, to help ensure the company maximizes the protection of information resources. Some access tools are: security policies, acceptable use policies, authorization policies, and authorization management systems.

Some other technologies and tools businesses that can be used for security and control include firewalls, intrusion detection systems, and encryption.

Bottom Line: While there is no surefire way to protect systems and data from every threat, great and small, businesses need to take a more company-wide approach to security. Every person in the organization, from CEO down, needs to be involved in security.

Chapter 7: Telecommunications, the Internet, and Wireless Technology

Chapter 7 discusses how networks are actually constructed and the various elements involved in connecting computers. Knowing how it all works can provide insight into the changes that have taken place and an idea of what the future holds. Today’s corporate network infrastructure is a collection of many different networks from the public switched telephone network; to the internet; to corporate local area networks linking workgroups or departments.

It’s likely that as the company grows, so will its networking capabilities and needs. Through enterprise networking a company can build a new network and connect it to existing, separate networks.

You can take a simple desktop computer and by way of Network Interface Card (NIC), incorporate it into an existing network. To share resources, such as printers, and to route communications on a LAN, you require special software called a Network Operating System (NOS). Hubs and switches help route traffic on the network to the right computing device. When two or more networks are connected to each other, you would need a Router somewhere so that data transmissions are routed to the correct network device.

Three key technologies necessary for network computing are: Client/Server Computing, Packet Switching, and Transmission Control Protocol/Internet Protocol (TCIP/IP).

Client/Server Computing facilitates computing on all kinds of networks including the internet; best used by companies that continually expand their network.

Packet Switching is a method of breaking large blocks of text into smaller chunks of data then routing them economically through whichever communication channel is available. Ex. At the grocery store you pick items, load them into your cart then head to the checkout line. You pay for your items while they are being bagged. You take your four or five bags of different items home then unpack the bags and place items in designated spaces in the cabinets. This is packet switching……….

TCIP/IP is the most popular model for connecting networks as this protocol was created for what we now call the Internet.

The system of computers and associated transmission media form what’s known as a Network Backbone. Think of your own body. Without your backbone, you’d have a tough time standing, sitting and moving.  Computers, physical wires, wireless media, processors and software come together in a network backbone to give us a whole new way of communicating.

The internet is a vast worldwide compilation of networked computers. IP addresses and the domain name system help ensure transmissions are routed to the correct recipient. Many applications such as e-mail, newsgroups, instant messaging and chatting are available.

It’s safe to say our computing habits will never be the same because of all the new computing devices and applications available through networks.  Communications over the Internet and other networks are easier, faster, and cheaper than ever before. E-commerce and e-business involve more technologies than just computers: tele-, data-, and videoconferencing are vital elements of doing business electronically.

Chapter 6: Foundations of Business Intelligence: Databases and Information Management

Information is becoming as important a business resource as money, material, and people. Even though a company compiles millions of pieces of data doesn’t mean it can produce information that its employees, suppliers, and customers can use. Businesses are realizing the advantage of compiling useful information, not just DATA.

Problems occur in managing data resources in a traditional file environment such as: data redundancy, program-data dependence, inflexibility, poor data security, and inability to share data among applications.

To illustrate these problems, let’s say you move and change addresses, you notify everyone of your new address including your bank. Everything is okay with receiving your monthly statements. All of a sudden, at the end of the year, the bank sends a Christmas Card to the old address. Why? Because the Bank changed the address in “one” database; the address was not changed in the separate Christmas Card database.  You are now a victim of data redundancy.

Managers and employees must know and understand how databases are constructed so they know how to use the information resource to their advantage.

Database Management Systems have three critical components: the data definition language, the data manipulation language, and the data dictionary. Managers should ensure that all three receive attention. There are three types of databases: hierarchical, network, and relational. Relational databases have been the most popular because they are easier to work with, change, and serve more organizational needs.

When designing a database one should think long and hard about how the information will be used in different situations. Consider how it is organized, stored, and used. Then imagine how this information could be organized better and more easily used. Involve as many end users in the planning stage as possible; they are the ones who will prosper or suffer because of the decisions made.

As organizations want and need more information about their company, their products, and their customers, the concept of data warehousing has become very popular. No, data warehouses are not big buildings with shelves and shelves of stuff; they are huge computer files that store old and new data that companies want to maintain information on. Using a data warehouse correctly can give management a tremendous amount of information that can be used to trim costs, reduce inventory, and attract new customers.

Ask any manager what their resources are and they will likely list people, equipment, buildings, and money. Very few managers will include INFORMATION on the list, yet it can be more valuable than some of the others.

Bottom Line: Information is power. The more information users have in an easy to use form, the more they can accomplish. Managers need to consider information as an important resource for which everyone has a responsibility.

Chapter 5: IT Infrastructure and Emerging Technologies

When you mention the phrase “information technology infrastructure", most people immediately think of just hardware and software. However, there is more to it than just those two. By broadening the definition to that of service-based, you are then bringing into the discussion the services generated by the first two components.

Some of the services to consider are: connecting employees, customers, and supplier; managing large amounts of data for internal and external use; and training employees how to use systems.

A typical company IT infrastructure can be divided into three major levels: public, enterprise and business. Each level has its own unique hardware, software, and service components.  Public includes the internet, networks, cellular phones. Enterprise includes email, intranets, and extranets. Business concentrates on components that serve: sales and marketing; production and manufacturing; finance and human resources.

One of the biggest drivers of technology evolution is declining communication costs and the internet. The exploding use of computers is directly attributed to the Internet. It is cheaper every day to connect to the Internet because of the declining costs. As more and more users connect to the Internet, businesses must find ways to meet the expectations and demands of users.

What is trending in Hardware and Software Platforms? The microprocessor is the heart of any computing device no matter how small or large. Microprocessing chips are produced by two companies: Intel and Advanced Micro Devices (AMD). The use of networks and mobile handheld devices has created the following hardware trends: mobile digital platforms, grid computing, virtualization, cloud computing, and green computing.

Since the network is becoming so commonplace and the heart of computing, network service providers must have the server backbone in place to meet the increased demand. Blade servers are meeting the needs of service providers easier than big-box servers.

Integrating applications into seamless processes across the organization is the goal of enterprise software application. The largest providers of enterprise application software are SAP and Oracle. Microsoft is making moves to focus on small and medium-sized businesses. The evolution of software platforms has created: Linux and open source software, Java and Ajax, Web Services, Software outsourcing and cloud services.

It’s extremely hard to figure out ahead of time how much computing capacity a company will need. It’s like gazing into a crystal ball and trying to analyze the future. Managers need to design scalability into their systems so that they don’t under or over build their systems. A company should examine its IT strategy, infrastructure, and cost for the next five years then decide the direction to go with technology.

Chapter 4: Ethical and Social Issues in Information Systems

It probably goes without saying that the security and ethical issues raised by the information age, and specifically the internet, are the most significant in decades. It will be many years and many court cases before socially acceptable policies and best practices are in place.

Scenario: You are a 25 year old, drive a Honda, like country music, shop at walmart at least once a month around the 15^th, wear a size 8 dress, like eating at Sonic, and spend lots of time on facebook chatting with other females your age. Would it surprise you to know that this information can be taken from various computer records?

A lot of personal information about us has always been available, just not as easily and as readily as today. Commercial company and government databases now allow profiling like in the scenario above to be done easier and faster than before.

New information technology raises new ethical, social and political issues that must be dealt with on individual, social, and political levels. These issues have five moral dimensions: information rights and obligations, property rights and obligations, system quality, quality of life, and accountability and control.

Technology can take information about people and find vague, non-obvious relationships. It might discover, for example, that an applicant for a job as a non-profit organization shares a telephone number with a known criminal and alerts the hiring manager.

Technological trends are posing new situations and questions we haven’t had to deal with before. Because it’s our world and our future, we should be concerned and prepared to resolve.

How do we solve some of the real world ethical dilemmas? Should companies be allowed to read employee’s personal emails? Should emails be used against a person or company in a court of law? Is it okay to run a personal website from your workplace computer? Should companies use technology to monitor your keystrokes to determine how much work you are doing?

Bottom Line: Ethics in an information society holds each person responsible for his or her actions. Each person is accountable for everything he or she does and liable for the consequences their actions may impose on other people and society.

Companies can no longer ignore the necessity of establishing rules for technology use. The issue won’t go away and will continue to grow. If you work for a company that does not have a policy, get busy and suggest one for everybody…..it’s the right thing to do!

Chapter 3 - Information Systems, Organizations, and Strategy

Chapter 3 – Information Systems, Organizations, and Strategy

Chapter 3 describes how organizations and information systems work together, or sometimes against each other; the idea is to keep them in sync.

Consider this, an automobile dealership would have some similarities to a department store (both sell products) and yet they would have major structural differences. Organizations that enter into collaborative partnerships tend to seek out companies with similar structures. It is much easier for the employees to work together if they aren’t required to learn a whole different work structure on top of learning new tasks.

Organizations generally differ because their ultimate goals differ; some organizations are small by nature or small by design. Many differ due to size, goals, and environmental factors that restrict growth.

For instance, a real estate company is constantly looking for new customers and new products to sell. It may choose to stay small or to go with a nationwide conglomerate. The environmental factors that are likely to influence it are the state of the national and local economy.

Organizations and information systems influence each other. Each organization shares common characteristics that the information system can enhance. On the other hand, each organization has unique characteristics that should be taken into account when incorporating technology. Perhaps the most important role of all is the end user.

Various forces affect an organization’s ability to compete and therefore greatly influence a firm’s business strategy. There are threats from new market entrants and from substitute products and services. Customers and suppliers exercise bargaining power; traditional competitors constantly adapt their strategies to maintain their market positioning.

Using information systems can help a company beat the competition through differentiation and providing services that are valuable to customers and suppliers. Information systems can also be used to reduce costs. What is the goal?

Completing a strategic systems analysis is one of the first steps managers should accomplish to help determine how they can use information systems to gain a competitive advantage. A well-developed strategic information system that is integrated throughout the company can be used to lower overall costs and provide greater value to the company, the supplier, and the customer.

Chapter 2 - Global e-Business and Collaboration

Chapter 2 – Global E-business and Collaboration

Being a digital company means more than just having the newest computers with all the latest bells and whistles. The digital company must connect each functional area and each management level to one another. Human Resources, Sales, Accounting, and Manufacturers must have access to appropriate information regardless of its origin. Information is the key to a digital company.

Business Processes that integrate functions throughout an organization assist with eliminating chaos. Processes can deliver the best product for the lowest cost and in the most efficient manner. The way a company organizes its workflows, the method it uses to accomplish tasks, and the way it coordinates its activities among employees, and customer, and suppliers determines its business processes.

Information systems can help organizations recognize processes that may need to be changed and automate some of those processes that are no longer needed. A successful organization will use an information system to determine which processes work well.

Management groups in organizations are served by four types of information systems. The transaction processing system (TPS) records the data from everyday operations throughout every division or department in the organization. Ex. How much sugar do we have for today’s production run?

The management information system (MIS) is used by managers throughout the organization to help them in directing, planning, coordinating, communicating, and decision making. The MIS will help answer structured questions: “How much more sugar must we purchase to increase production from 500 cakes to 700?

Decision-support systems (DSS) are used for complex questions that require internal and external data. Ex. “How does will a change in size of the packaging of the cake affect the other products we produce, not just in shipping, but on the display shelves at stores?

An executive support system (ESS) helps managers make strategic decisions affecting the entire company. External and Internal data is given to executives to help determine the best course of action in different situations. With an ESS, company executives make decision based on information, not opinion.

The key element for all these system is integration. The cake would not be a success if all systems did not work together to produce a coherent picture for all levels of management. If the information from the TPS did not feed in the MIS, which incorporated information to assist the DIS, which then worked with the ESS, then the cake would just be another dessert.

Chapter 1 - Information Systems in Global Business Today

Chapter 1 – Information Systems in Global Business Today

Computers are changing every aspect of our lives from entertainment to shopping, from the work we do and where we do it, to how we communicate with friends and relatives. Information Technology is being used by many businesses worldwide to increase efficiency, save money, and create better relationships between suppliers and customers.

Information systems are transforming businesses and creating global relationships. Next time you purchase a product, any product, look at the fine print and see where it’s made. It may be China, the Philippines, or even in the United States. It can be debated that many manufacturing jobs are being moved from the U.S. to foreign countries, but look at the huge number of jobs that are being created here in the U.S. In fact, many of the jobs are in the information industry and serve whole new markets that didn’t exist just a few years ago.

Why does Information Systems matter in running and managing business today? Capital Management, Foundation for Doing Business, Productivity, Strategic Opportunities and Advantages are just a few of the reasons to consider if it matters. For many years computer technology was only the “techies” worry; today every employee, must know how to take advantage of information systems to improve organizations and leverage available information into a competitive advantage for the company.

As a company becomes more digital, its’ information system should continue to extend beyond the traditional role of serving the employees. Developing the complementary assets associated with the information systems such as developing new business processes, emphasizing employee training in technology, and creating new partnerships with suppliers, customers, and even competitors, can be challenging.

This is why using information systems effectively requires an understanding of the organization, management, and information technology shaping the systems. An information system creates value for the firm as an organizational and management solution to challenges posed by the environment.

Successful managers must concentrate on all three parts of the information systems triangle (hardware, software, and persware) then integrate them into a single, cohesive system that serves the needs of the organization, customer wants, and employee desires.

Everyone in the organization must understand that information systems and the use of technology belong to them. This concept is best carried out through a sociotechnical approach to viewing information systems, which allows both the technical and behavioral approaches to be combined for the good of the organization.

Bottom Line: Management’s focus must continually change to take advantage of new opportunities with changes taking place throughout the organization. These changes require lots of attention and planning for smooth execution.