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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
GLOBAL INFORMATION SYSTEMS
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
LO1 Discuss reasons for globalization and using global information systems, including e-business and Internet growth.
LO2 Describe global information systems and their requirements and components.
LO3 Explain the types of organizational structures used with global information systems.
LO4 Discuss obstacles to using global information systems.
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Why Go Global?
Example: shoe company
Upper shipped to China
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Why Go Global? (cont’d.)
2008 Coca-Cola Company
Generated more than 80% of its revenue from outside United States
Prerequisites to the success of a global information system:
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Why Go Global? (cont’d.)
Airline reservation systems
Global products
Products or services that have been standardized for all markets
Manufacturer might “regionalize” operations
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Global Information Systems at Rohm & Haas
Part of Dow Chemical
Overhauled its global information system
By upgrading the order entry system
Installed a companywide materials management system tied in with a global demand planning system
Can now provide better service to its customers
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
E-Business: A Driving Force
Major factor in the widespread use of global information systems
Builds on the advantages and structures of traditional business
The Internet
Simplify communication
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
E-Business: A Driving Force (cont’d.)
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Global Information Systems: An Overview (Mallare Report)
Global information system (GIS)
Facilitates communication between headquarters and subsidiaries in other countries
Incorporates all the technologies and applications found in a typical information system
Stores, manipulates, and transmits data across cultu
ral and geographic boundaries
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Global Information Systems: An Overview (cont’d.)
International company
Can increase control and enhance coordination of its subsidiaries and be able to access new global markets
Strategic planning is a core function
Defined in terms of two dimensions:
Control and coordination
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Global Information Systems: An Overview (cont’d.)
Control requires:
Standard formats for reports
Performance-tracking system
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Global Information Systems: An Overview (cont’d.)
Coordination requires:
Collaboration systems
Many advantages of high coordination
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Components of a Global Information System
Basic components:
Global database
Information-sharing technologies
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Components of a Global Information System (cont’d.)
Information system manager
Faces design and implementation issues when developing a global network
Determines the best communication media to meet global performance and traffic needs
Chooses the best transmission technology for the global network’s needs
Considers the company’s objectives when determining the network architecture
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Components of a Global Information System (cont’d.)
Technical challenges in GIS design:
Designing and implementing global databases
Transborder data flow (TDF)
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Requirements of Global Information Systems
Must be capable of supporting complex global decisions
Multinational corporations (MNCs) environment includes many variations in different forces
Legal
Cultural
Economic
Political
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Requirements of Global Information Systems (cont’d.)
Operational requirements:
Management of short-term foreign exchange risks
Strategic requirements:
Management of global tax risks
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Goals of Global Information Systems (end of Mallari’s Report)
Issues:
Justify investment in GIS
Coordinate migration carefully
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Organizational Structures and Global Information Systems (Quizon’s Report)
Four commonly accepted types of global organizations:
Multinational
Global
International
Transnational
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Multinational Structure
Financial management remains the parent’s responsibility
Example: Tyco Corporation
Each subsidiary operates on a different platform
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Exhibit 9.1
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Global Structure
Examples:
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Exhibit 9.2
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
International Structure
But subsidiaries depend on headquarters more for process and production decisions
Information systems personnel are regularly exchanged among locations
Encourages a cooperative culture in geographically dispersed personnel
Example: Caterpillar Corporation
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Exhibit 9.3
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Transnational Structure
Parent and all subsidiaries work together in designing policies, procedures, and logistics
Usually focuses on optimizing supply sources and using advantages available in subsidiary locations
Architecture requires a higher level of standardization and uniformity for global efficiency
But must maintain local responsiveness
Examples: Citigroup, Sony, Ford
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Exhibit 9.4
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Global Information Systems Supporting Offshore Outsourcing
Offshore outsourcing
Organization chooses an outsourcing firm in another country
Used for many information technology tasks
GIS plays an important role in supporting offshore outsourcing
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Table 9.1
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
The Internet and Globalization in Action (Quizon’s End of Report)
The Internet allows entrepreneurs in developing countries to start and expand businesses without making large investments
Muhammad Hassaan Khan, a young entrepreneur, established a design and consulting business called Zuha Innovation that is based in Faisalabad, Pakistan
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Obstacles to Using Global Information Systems (marchael)
Lack of standardization
Can also include differences in time zones, taxes, language, work habits, etc.
Cultural differences
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Lack of Standardization
Lack of international standards impedes developing a cohesive system that’s capable of sharing information resources across borders
Too much standardization can prevent flexibility in responding to local preferences and even time differences
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Cultural Differences
Views on using technology
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Diverse Regulatory Practices
Jurisdiction issues on contents of a GIS
Nature of intellectual property laws
Software piracy
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Poor Telecommunication Infrastructures
Differences in standards
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Lack of Skilled Analysts and Programmers
Severe shortage of qualified information systems professionals in the United States and Western Europe
Companies must consider the nature of each culture and differences in skills in other countries
Training and certification programs
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MIS, Chapter 9 ©2011 Course Technology, a part of Cengage Learning
Chapter 9 Global Information Systems
Summary
Global information systems: