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ORGANIZATION FORMAL DEFINITION: - stable, formal structure takes resources/inputs from environment – capital, labour, materials, knowledge(?) etc processes them to produce outputs *
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Information Systems and Organisations
Outline:• Understanding the inter-relationships between
IT and organisations,• Formal models and theories of organisations,• Understanding and mapping business processes• How does the Information Systems function fit
into organisation.
MEDIATING FACTORS:MEDIATING FACTORS: Environment Environment CultureCultureStructure Structure Standard Procedures Standard Procedures Politics Politics Management Decisions Management Decisions ChanceChance
ORGANIZATIONS & INFORMATION TECHNOLOGY
ORGANIZATIONSORGANIZATIONS INFORMATION INFORMATION TECHNOLOGYTECHNOLOGY
V P V P V P
C E OORGANIZATION
FORMAL DEFINITION:
- stable, formal structure• takes resources/inputs from environment – capital,
labour, materials, knowledge(?) etc• processes them• to produce outputs
*
STRUCTURAL CHARACTERISTICS OF ALL ORGANIZATIONS
• Clear division of labor• Hierarchy• Explicit rules & procedures: standard operating
procedures (sop)• Objective/impartial judgments• Technical qualifications• Strive for maximum organizational efficiency
*
ENVI
RO
NM
ENTA
L R
ESO
UR
CES
ENVI
RO
NM
ENTA
L R
ESO
UR
CES
ENVI
RO
NM
ENTA
L O
UTP
UTS
ENVI
RO
NM
ENTA
L O
UTP
UTS
BEHAVIORAL VIEW OF ORGANIZATIONS
STRUCTURE:Hierarchy Division of laborRules, Procedures
PROCESS: Rights/Obligations Privileges/Responsibilities ValuesNorms People *
TYPES OF ORGANIZATIONS
• ENTREPRENEURIAL: Startup business• MACHINE BUREAUCRACY: Mid-sized
manufacturing firm• DIVISIONALIZED BUREAUCRACY: Very
Large, multi-business/multi-divisional corporations• PROFESSIONAL BUREAUCRACY: Law firms,
hospitals• ADHOCRACY: Consulting firm
*
ORGANIZATION & ITS ENVIRONMENT
THE FIRM
INFORMATION SYSTEMSINFORMATION SYSTEMS
THE ENVIRONMENT:THE ENVIRONMENT:
RESOURCES & CONSTRAINTS
GOVERNMENTS
COMPETITORS
FINANCIAL INSTITUTIONS
CULTURE
KNOWLEDGE
TECHNOLOGY
BROADER VIEW OF ORGANIZATIONS
COMMON FEATURES:• FORMAL STRUCTURE• STANDARD OPERATING
PROCEDURES• POLITICS• CULTURE
*
3.11
SALIENT FEATURES OF ORGANIZATIONS
UNIQUE FEATURES:ORGANIZATIONAL TYPE
ENVIRONMENTS, GOALS, POWERCONSTITUENCIES, FUNCTION
LEADERSHIP, TASKSTECHNOLOGY
LEVELS*
Business Process: The unique breakdown and sequence of activities that an organisation specifies for the completion of a task. Typically we refer to tasks that cut across multiple functions or departments.
Eg. Order fulfillment, new product introduction
WORK GROUPS, PROBLEMS, SYSTEM SUPPORT
• HIERARCHICAL: Frequent meetings, workers dispersed– VIDEO CONFERENCING, E-MAIL
• INTERDEPARTMENTAL COMMITTEES: Need occasional direct communication– ELECTRONIC MESSAGING
*
WORK GROUPS, PROBLEMS, SYSTEM SUPPORT
• PROJECT TEAMS: Day-to-day interactions, meeting schedules– SCHEDULING/COMMUNICATION/ SUPPORT
SOFTWARE, INTRANET• COMMITTEES: High peak load, intermittent
communication– ELECTRONIC BULLETIN BOARDS,
VIDEO/COMPUTER CONFERENCING, E-MAIL
*
WORK GROUPS, PROBLEMS, SYSTEM SUPPORT
• TASK FORCES: Rapid communication, internal/external data– GRAPHICS DISPLAY, INFORMATION/
DOCUMENTATION INTERCHANGE• PEER GROUPS: Intense personal
communication– TELEPHONE, E-MAIL
*
PROBLEMS OF ALL WORK GROUPS
• Making arrangements• Attending meetings• Long agenda• Cost of meetings• Between-meeting activities
*
DEVELOPMENT OF INFORMATION ARCHITECTURE
• 1950s: ELECTRONIC ACCOUNTING MACHINES
• 1960s: DATA PROCESSING DEPARTMENTS• 1970s: INFORMATION SYSTEMS• 1980s: INFORMATION SYSTEMS &
SERVICES• 1990s: ENTERPRISE-WIDE INFORMATION
UTILITY*
INFORMATION SYSTEMS DEPARTMENT
• PROGRAMMERS: Write software• SYSTEMS ANALYSTS: Translate business problems
into solutions• Data Administrators: in charge of managing the
information resources of the org.• IS MANAGERS: Department leaders• Chief Information Officer (CIO)• END USERS: Department reps for whom applications
are developed *
PERSPECTIVES ON ORGANIZATIONS AND
THE ROLE OF IT• MICROECONOMIC MODEL/THEORY
OF THE FIRM: The outputs of the firm as a function of key factors of production such as capital C, labor L, and knowledge K. Investments in IT can lead to increase in K and reduction overall L.
• AGENCY/TRANSACTION COST THEORY: Firm is nexus of contracts among agents who make decisions. The firms attempts to minimise transaction costs in contracting. IS/IT shrink number of agents & reduce transaction costs.
• BEHAVIORAL THEORIES: Concepts from Psychology, Political Science; Organizations & Information Technology mutually influence each other. Implementation strategies, resistance..
*
PERSPECTIVES ON ORGANIZATIONS AND
THE ROLE OF IT
PERSPECTIVES ON ORGANIZATIONS AND
THE ROLE OF IT• DECISION & CONTROL THEORY: Decisions
are made under conditions of risk & uncertainty; centralization & hierarchy can reduce uncertainty in certain circumstances.
• SOCIOLOGICAL THEORY: Bureaucracy, SOPs help stabilize organizations, but slow ability to change
*
PERSPECTIVES ON ORGANIZATIONS AND
THE ROLE OF IT• POSTINDUSTRIAL THEORY: Flatter
organizations; dominated by knowledge workers; decentralized decision making
• CULTURAL THEORY: Information technology must fit organization’s culture to be accepted
*
PERSPECTIVES ON ORGANIZATIONS AND
THE ROLE OF IT
• POLITICAL THEORY: Info systems are outcome of political competition among coalitions and groups for power and resources.
*
IMPLEMENTING CHANGE
Source: Leavitt, Handbook of Organization (1965)
TASKTASK
PEOPLEPEOPLETECHNOLOGYTECHNOLOGY
STRUCTURESTRUCTURE
RESISTANCERESISTANCE
MUTUALMUTUALADJUSTMENTADJUSTMENT
HOW INTERNET AND THE WORLD WIDE WEB AFFECT ORGANIZATIONS• More info, anywhere, anytime/potential
information overload• More scope, depth, range of knowledge• Lowers cost, potential to raise quality of
info distribution: *
Types of Decisions
• Well-Structured decisions• Semi-structured decisions• Unstructured or ill-structured decisions
They lie along a continuum.
INFO SYSTEMS, LEVELS, DECISIONS
TPSOAS MIS
KWS
DSS
ESS
ORGANIZATIONAL LEVELORGANIZATIONAL LEVELTYPE OFTYPE OFDECISIONDECISION OPERATIONAL KNOWLEDGE MANAGEMENT STRATEGIC
STRUCTURED ACCOUNTS RECEIVABLE
ELECTRONIC PRODUCTIONSCHEDULING COST OVERRUNS
SEMI- BUDGETSTRUCTURED PREPARATION
PROJECTSCHEDULING
FACILITYLOCATION
UNSTRUCTURED PRODUCT DESIGN NEW PRODUCTSNEW MARKETS
STAGES OF DECISION MAKING• INTELLIGENCE: Collect information;
identify problem• DESIGN: Conceive alternatives; select criteria• CHOICE: Use criteria to evaluate alternatives;
select • IMPLEMENTATION: Put decision into effect;
allocate resources; control*
SOURCE: Simon, The New Science of Management Decision (1960)
• RATIONAL MODEL: Assumes comprehensive rationality - comprehensive search for alternatives, their systematic evaluation against objectives, choosing the alternative that maximises value.
• Satisficing Models: Based on the concept of bounded rationality - people do not have the cognitive capacity to be comprehensively rational; hence they ‘satisfice’.
• Political Model
MODELS OF DECISION MAKING