3.3.11

CHAPTER 3. INFORMATION CHAPTER 3. INFORMATION SYSTEMS, ORGANIZATIONS, SYSTEMS, ORGANIZATIONS, & MANAGEMENT:& MANAGEMENT:

BUSINESS BUSINESS PROCESSES & PROCESSES & ENTERPRISE ENTERPRISE SYSTEMSSYSTEMS

3.3.22

LEARNING OBJECTIVESLEARNING OBJECTIVES

• IDENTIFY CHARACTERISTICS OF IDENTIFY CHARACTERISTICS OF ORGANIZATIONSORGANIZATIONS

• RELATE INFO SYSTEMS TO RELATE INFO SYSTEMS TO ORGANIZATIONSORGANIZATIONS

• ASSESS ORGANIZATIONAL & ASSESS ORGANIZATIONAL & INFORMATION TECHNOLOGYINFORMATION TECHNOLOGY

**

3.3.33

LEARNING OBJECTIVESLEARNING OBJECTIVES

• COMPARE THEORIES OF COMPARE THEORIES OF ORGANIZATIONSORGANIZATIONS

• DESCRIBE DECISION PROCESSESDESCRIBE DECISION PROCESSES

• ASSESS IMPLICATIONS OF SYSTEM ASSESS IMPLICATIONS OF SYSTEM DESIGN & IMPLEMENTATIONDESIGN & IMPLEMENTATION

**

3.3.44

MANAGEMENT CHALLENGESMANAGEMENT CHALLENGES

• DIFFICULTIES OF MANAGING DIFFICULTIES OF MANAGING CHANGECHANGE

• FITTING TECHNOLOGY & FITTING TECHNOLOGY & ORGANIZATIONORGANIZATION

**

3.3.55

VP VP VP

CEO ORGANIZATIONORGANIZATION

TECHNICAL DEFINITION:TECHNICAL DEFINITION:

STABLE, FORMAL STRUCTURESTABLE, FORMAL STRUCTURE

• TAKES RESOURCES FROM TAKES RESOURCES FROM ENVIRONMENTENVIRONMENT

• PROCESSES THEMPROCESSES THEM

• TO PRODUCE OUTPUTSTO PRODUCE OUTPUTS

**

3.3.66

ORGANIZATIONORGANIZATION

BEHAVIORAL DEFINITION:BEHAVIORAL DEFINITION:

COLLECTION OFCOLLECTION OF

• RIGHTS, PRIVILEGES, RIGHTS, PRIVILEGES, OBLIGATIONS, RESPONSIBILITIESOBLIGATIONS, RESPONSIBILITIES

• DELICATELY BALANCEDDELICATELY BALANCED

• CONFLICT RESOLUTIONCONFLICT RESOLUTION

**

3.3.77

MEDIATING FACTORS:MEDIATING FACTORS: Environment Environment CultureCultureStructure Structure Standard Procedures Standard Procedures Politics Politics Management Decisions Management Decisions ChanceChance

ORGANIZATIONS & ORGANIZATIONS & INFORMATION TECHNOLOGYINFORMATION TECHNOLOGY

ORGANIZATIONSORGANIZATIONS INFORMATION INFORMATION TECHNOLOGYTECHNOLOGY

3.3.88

EN

VIR

ON

ME

NT

AL

RE

SO

UR

CE

SE

NV

IRO

NM

EN

TA

L R

ES

OU

RC

ES

EN

VIR

ON

ME

NT

AL

OU

TP

UT

SE

NV

IRO

NM

EN

TA

L O

UT

PU

TS

FORMAL ORGANIZATIONFORMAL ORGANIZATION

STRUCTURE:STRUCTURE: HierarchyHierarchyDivision of Division of

laborlabor Rules, ProceduresRules, Procedures

PROCESS:PROCESS: Rights/Rights/ObligationsObligations Privileges/ResponsibilitiesPrivileges/Responsibilities ValuesValues

NormsNormsPeoplePeople

3.3.99

STRUCTURAL CHARACTERISTICS OF STRUCTURAL CHARACTERISTICS OF ALL ORGANIZATIONSALL ORGANIZATIONS

• CLEAR DIVISION OF LABORCLEAR DIVISION OF LABOR• HIERARCHYHIERARCHY• EXPLICIT RULES & PROCEDURESEXPLICIT RULES & PROCEDURES• IMPARTIAL JUDGMENTSIMPARTIAL JUDGMENTS• TECHNICAL QUALIFICATIONSTECHNICAL QUALIFICATIONS• MAXIMUM ORGANIZATIONAL MAXIMUM ORGANIZATIONAL

EFFICIENCYEFFICIENCY

**

3.3.1010

COMMON FEATURES OF COMMON FEATURES OF ORGANIZATIONSORGANIZATIONS

• FORMAL STRUCTUREFORMAL STRUCTURE

• STANDARD OPERATING STANDARD OPERATING PROCEDURESPROCEDURES

• POLITICSPOLITICS

• CULTURECULTURE

**

3.3.1111

UNIQUE FEATURES OF UNIQUE FEATURES OF ORGANIZATIONSORGANIZATIONS

• ORGANIZATIONAL TYPES ORGANIZATIONAL TYPES

• ENVIRONMENTS, GOALS, POWERENVIRONMENTS, GOALS, POWER

• CONSTITUENCIES, FUNCTIONCONSTITUENCIES, FUNCTION

• LEADERSHIP, TASKSLEADERSHIP, TASKS

• TECHNOLOGYTECHNOLOGY

• BUSINESS PROCESSESBUSINESS PROCESSES

**

3.3.1212

ORGANIZATION & ITS ENVIRONMENTORGANIZATION & ITS ENVIRONMENT

THE FIRM

INFORMATION SYSTEMSINFORMATION SYSTEMS

THE ENVIRONMENT:THE ENVIRONMENT:

RESOURCES & CONSTRAINTS

GOVERNMENTS

COMPETITORS

FINANCIAL INSTITUTIONS

CULTURE

KNOWLEDGE

TECHNOLOGY

3.3.1313

ORGANIZATIONAL STRUCTURESORGANIZATIONAL STRUCTURES

• ENTREPRENEURIAL:ENTREPRENEURIAL: Startup business Startup business• MACHINE BUREAUCRACY: Mid-sized MACHINE BUREAUCRACY: Mid-sized

manufacturing firmmanufacturing firm• DIVISIONALIZED BUREAUCRACY:DIVISIONALIZED BUREAUCRACY:

Fortune 500Fortune 500• PROFESSIONAL BUREAUCRACY:PROFESSIONAL BUREAUCRACY: Law Law

firms, hospitalsfirms, hospitals• ADHOCRACY:ADHOCRACY: Consulting firm Consulting firm

**

3.3.1414

INFORMATION SYSTEMS INFORMATION SYSTEMS DEPARTMENTDEPARTMENT

• PROGRAMMERS:PROGRAMMERS: Write software Write software

• SYSTEMS ANALYSTS:SYSTEMS ANALYSTS: Translate Translate business problems into solutionsbusiness problems into solutions

• IS MANAGERS:IS MANAGERS: Department leaders Department leaders

• END USERS:END USERS: Department reps for Department reps for whom applications are whom applications are developed developed

**

3.3.1515

THE ORGANIZATIONTHE ORGANIZATION SENIOR MANAGEMENT MAJOR END-USERS (DIVISIONS)

INFORMATION SYSTEMS DEPARTMENT

IT Infrastructure:

HardwareSoftwareData Networks

Information System Specialists:

CIOManagersSystem AnalystsSystem DevelopersProgrammersNetwork SpecialistsDatabase AdministratorClerical

3.3.1616

HOW INFO SYSTEMS AFFECT HOW INFO SYSTEMS AFFECT ORGANIZATIONSORGANIZATIONS

• MICROECONOMIC MODEL:MICROECONOMIC MODEL: Info Info technology is a factor of production, technology is a factor of production, like capital & laborlike capital & labor

• TRANSACTION COST THEORY:TRANSACTION COST THEORY: Firms attempt to minimize Firms attempt to minimize transaction costs internally & transaction costs internally & externallyexternally

**

3.3.1717

HOW INFO SYSTEMS AFFECT HOW INFO SYSTEMS AFFECT ORGANIZATIONSORGANIZATIONS

• AGENCY THEORY:AGENCY THEORY: Firm is nexus of Firm is nexus of contracts among self-interested parties contracts among self-interested parties requiring supervisionrequiring supervision

• BEHAVIORAL THEORIES:BEHAVIORAL THEORIES: Info systems Info systems could change hierarchy of decision could change hierarchy of decision making; reduce need for middle making; reduce need for middle management & clerical support; management & clerical support; distribute informationdistribute information

**

3.3.1818

IMPLEMENTING CHANGEIMPLEMENTING CHANGE

Source: Leavitt, Handbook of Organization (1965)

TASKTASK

PEOPLEPEOPLETECHNOLOGYTECHNOLOGY

STRUCTURESTRUCTURE

RESISTANCERESISTANCE

MUTUALMUTUALADJUSTMENTADJUSTMENT

3.3.1919

INTERNET & ORGANIZATIONSINTERNET & ORGANIZATIONS

• E-mail communicationE-mail communication

• Electronic handbooks published & Electronic handbooks published & revisedrevised

• Interactive training classesInteractive training classes

• Employees review, update personal Employees review, update personal datadata

**

3.3.2020Sales &

Marketing

Accounting

Finance

Manufacturing

Human Resources

ENTERPRISE SYSTEMENTERPRISE SYSTEM

Business ProcessesBusiness Processes

Enterprise-wide Enterprise-wide Business ProcessesBusiness Processes

Vendors Customers

3.3.2121

ROLE OF MANAGERSROLE OF MANAGERS

• CLASSICAL:CLASSICAL: Describe functions- Describe functions- plan, organize, coordinate, decide, plan, organize, coordinate, decide, controlcontrol

• BEHAVIORAL:BEHAVIORAL: Based on Based on observations of managers on the jobobservations of managers on the job

**

3.3.2222

INFO SYSTEMS, LEVELS, DECISIONSINFO SYSTEMS, LEVELS, DECISIONS

TPS

OAS MIS

KWS

DSS

ESS

ORGANIZATIONAL LEVELTYPE OFDECISION OPERATIONAL KNOWLEDGE MANAGEMENT STRATEGIC

STRUCTURED ACCOUNTS RECEIVABLE

ELECTRONIC PRODUCTIONSCHEDULING COST OVERRUNS

SEMI- BUDGETSTRUCTURED PREPARATION

PROJECTSCHEDULING

FACILITYLOCATION

UNSTRUCTURED PRODUCT DESIGN NEW PRODUCTSNEW MARKETS

3.3.2323

STAGES OF DECISION MAKINGSTAGES OF DECISION MAKING

• INTELLIGENCE:INTELLIGENCE: Collect Collect information; information; identify problemidentify problem

• DESIGN:DESIGN: Conceive alternatives; select Conceive alternatives; select criteriacriteria

• CHOICE:CHOICE: Use criteria to evaluate Use criteria to evaluate alternatives; select alternatives; select

• IMPLEMENTATION:IMPLEMENTATION: Put decision into Put decision into effect; allocate resources; controleffect; allocate resources; control

**

SOURCE: Simon, The New Science of Management Decision (1960)

3.3.2424

• RATIONAL:RATIONAL: Comprehensive Comprehensive rationality; evaluate all rationality; evaluate all alternativesalternatives

• SYSTEMATIC:SYSTEMATIC: Structured, formal Structured, formal methodmethod

• INTUITIVE:INTUITIVE: Trial & error, unstructured, Trial & error, unstructured, multiple approachmultiple approach

**

INDIVIDUAL MODELS OF INDIVIDUAL MODELS OF DECISION MAKINGDECISION MAKING

3.3.2525

• BUREAUCRATIC:BUREAUCRATIC: Follow Follow standard operating procedures (SOP)standard operating procedures (SOP)

• POLITICAL:POLITICAL: Key groups compete and Key groups compete and bargainbargain

• ““GARBAGE CAN”:GARBAGE CAN”: Organizations not Organizations not rational; solutions accidentalrational; solutions accidental

**

ORGANIZATIONAL ORGANIZATIONAL MODELS OF DECISION MODELS OF DECISION

MAKINGMAKING

3.3.2626

IMPLICATIONS FOR DESIGN & IMPLICATIONS FOR DESIGN & UNDERSTANDING INFO SYSTEMSUNDERSTANDING INFO SYSTEMS

ENVIRONMENTENVIRONMENT

STRUCTURESTRUCTURE

CULTURECULTURE

POLITICSPOLITICS**

3.3.2727

Connect to the INTERNETConnect to the INTERNETLaudon/Laudon Web site:

http://www.prenhall.com/laudon

Additional Internet Resources related to this chapter:http://spot.colorado.edu/~isoadm/http://tools.org/EI/ICEIMT

http://www.brint.com/http://www.santafe.edu/http://www.reengineering.com/http://bprc.warwick.ac.uk/www-site/bpr2indx.htmlhttp://www.cio.com/forums/erphttp://www.eil.utoronto.ca/eil.htmlhttp://www.erpsupersite.com

© 2001 Laudon & Laudon, Essentials of Management Information Systems 4/e

3.3.2828

CHAPTER 3. INFORMATION CHAPTER 3. INFORMATION SYSTEMS, ORGANIZATIONS, SYSTEMS, ORGANIZATIONS, & MANAGEMENT:& MANAGEMENT:

BUSINESS BUSINESS PROCESSES & PROCESSES & ENTERPRISE ENTERPRISE SYSTEMSSYSTEMS