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The use of information systems to add value to the organization is strongly influenced by organizational structure, culture, and change. Changes in the org. will cause changes in IS Changes in IS and Technology will change the org. A good example is ERP.

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  • The use of information systems to add value to the organization is strongly influenced by organizational structure, culture, and change.

  • Changes in the org. will cause changes in IS

  • Changes in IS and Technology will change the org. A good example is ERP.

  • What role will you play in Org. structure, culture, change management and decisions regarding the use of IS’s?

Principles of Information Systems, Seventh Edition


  • Because information systems are so important, businesses need to be sure that improvements or completely new systems help lower costs, increase profits, improve service, or achieve a competitive advantage

    • TCO is used to help measure ROI

  • What is ROI and why is it important to organizations.

Principles of Information Systems, Seventh Edition


Organizations and information systems
Organizations and Information Systems need to be sure that improvements or completely new systems help lower costs, increase profits, improve service, or achieve a competitive advantage

  • Organization: a formal collection of people and other resources established to accomplish a set of goals.

  • Are there any org’s within the same industry that are exactly the same??? Do organizations change over time?

  • An organization is a system

    • Inputs to the system: resources such as materials, people, and money. (land, labor, and capital

    • Outputs to the environment: goods or services

Principles of Information Systems, Seventh Edition


Organizations and information systems continued
Organizations and Information Systems (continued) need to be sure that improvements or completely new systems help lower costs, increase profits, improve service, or achieve a competitive advantage

  • Value chain: a series (chain) of activities that includes inbound logistics, warehouse and storage, production, finished product storage, outbound logistics, marketing and sales, and customer service

  • Upstream management: management of raw materials, inbound logistics, and warehouse and storage facilities

  • Downstream management: management of finished product storage, outbound logistics, marketing and sales, and customer service

Principles of Information Systems, Seventh Edition


Value chain again
Value Chain, again need to be sure that improvements or completely new systems help lower costs, increase profits, improve service, or achieve a competitive advantage

  • Why is the concept of the value chain important??

  • Cone’s answer.

    • Always looking at all processes and activities determining how you can change, add, or delete processes with information systems to add value to products or services.

    • This will be in your realm as a decision maker. The only way that you will be successful in your own business or by working for a business is to make “good” decisions.

Principles of Information Systems, Seventh Edition


Organizational structure
Organizational Structure need to be sure that improvements or completely new systems help lower costs, increase profits, improve service, or achieve a competitive advantage

  • Organizational structure: organizational subunits and their relationship with the overall organization

  • Categories of organizational structure:

    • Traditional

    • Project

    • Team

    • Multidimensional

    • Virtual

Principles of Information Systems, Seventh Edition


Traditional organizational structure
Traditional Organizational Structure need to be sure that improvements or completely new systems help lower costs, increase profits, improve service, or achieve a competitive advantage

  • A hierarchical structure

  • Major department heads report to a president or top-level manager

  • A managerial pyramid shows the hierarchy of decision making and authority

Principles of Information Systems, Seventh Edition


Figure 2 3 a simplified organizational model showing the managerial pyramid
Figure 2.3: A simplified organizational model, showing the managerial pyramid

What does this do with making decisions ???

Principles of Information Systems, Seventh Edition


Figure 2 4 a traditional organizational structure
Figure 2.4: A Traditional Organizational Structure managerial pyramid

Principles of Information Systems, Seventh Edition


Project organizational structure
Project Organizational Structure managerial pyramid

  • Centered around major products or services

  • Temporary project teams

Principles of Information Systems, Seventh Edition


Team organizational structure
Team Organizational Structure managerial pyramid

  • Centered on work teams or groups

  • Temporary or permanent teams

  • Various sizes

Principles of Information Systems, Seventh Edition


Multidimensional organizational structure
Multidimensional Organizational Structure managerial pyramid

  • May incorporate several structures at the same time

  • Advantage: ability to simultaneously stress both traditional corporate areas and important product lines

  • Disadvantage: multiple lines of authority

Principles of Information Systems, Seventh Edition


Virtual organizational structure and collaborative work
Virtual Organizational Structure and Collaborative Work managerial pyramid

  • Employs individuals, groups, or business units in geographically dispersed areas

  • People may never meet face to face

    • A job is not necessarily a place you go to.

  • Can be permanent or temporary

  • Collaborative work: managers and employees can effectively work in groups around the world

Principles of Information Systems, Seventh Edition


Reengineering
Reengineering managerial pyramid

  • Process redesign

  • Radical redesign of business processes, organizational structures, information systems, and values of the organization to achieve a breakthrough in business results

Principles of Information Systems, Seventh Edition


Figure 2 8 reengineering
Figure 2.8: Reengineering managerial pyramid

Principles of Information Systems, Seventh Edition


Continuous improvement
Continuous Improvement managerial pyramid

  • Constantly seeking ways to improve business processes

  • Benefits:

    • Increased customer loyalty

    • Reduced customer dissatisfaction

    • Reduced opportunity for competitive inroads

Principles of Information Systems, Seventh Edition


Technology diffusion infusion and acceptance
Technology Diffusion, Infusion, and Acceptance managerial pyramid

  • Technology diffusion: measure of how widespread the use of technology is in an organization

  • Technology infusion: extent to which technology permeates a department

Principles of Information Systems, Seventh Edition


Technology diffusion infusion and acceptance1
Technology Diffusion, Infusion, and Acceptance managerial pyramid

  • Technology Acceptance Model (TAM): specifies factors that can lead to higher usage of technology in an organization such as

  • The perceived usefulness of the tech.

  • The ease of its use

  • The quality of the IS

  • The degree to which the org. supports the use of the IS. What else????

Principles of Information Systems, Seventh Edition


Technology diffusion infusion and acceptance2
Technology Diffusion, Infusion, and Acceptance managerial pyramid

  • What is the best mixture of the diffusion, infusion, and acceptance for best performance and profitability ???

Principles of Information Systems, Seventh Edition


Outsourcing on demand computing and downsizing
Outsourcing, On-Demand Computing, and Downsizing managerial pyramid

  • Outsourcing: contracting with outside professionals

  • On-demand computing: contracting for computer resources to rapidly respond to an organization’s varying workflow

  • Downsizing: reducing the number of employees in an organization to cut costs. Usually the result of what???

Principles of Information Systems, Seventh Edition


Competitive advantage
Competitive Advantage managerial pyramid

  • Competitive advantage: significant, long-term benefit to a company over its competition

    • Once you achieve competitive advantage using IS’s you can usually keep it for a rather long time. Agree? Why?

  • Ability to establish and maintain a competitive advantage is vital to a company’s success

Principles of Information Systems, Seventh Edition


Factors that lead firms to seek competitive advantage
Factors That Lead Firms to Seek Competitive Advantage managerial pyramid

  • Rivalry among existing competition

  • Threat of new entrants

  • Threat of substitute products and services

  • Bargaining power of customers and suppliers

Principles of Information Systems, Seventh Edition


Table 2 4 competitive advantage factors and strategies
Table 2.4: Competitive Advantage Factors and Strategies managerial pyramid

Principles of Information Systems, Seventh Edition


Major stages in the use of is
Major Stages in the Use of IS managerial pyramid

  • 1960’s. Oriented toward cost reduction and productivity. Ignored the revenue side.

  • 1980’s. Oriented toward spending large amounts on IS and ignoring the costs.

  • Today. Performance based information systems.

    • Next Slide.

Principles of Information Systems, Seventh Edition


Performance based information systems
Performance-Based Information Systems managerial pyramid

  • Considers both strategic advantage and costs

  • Uses productivity, return on investment (ROI), net present value, and other measures of performance

Principles of Information Systems, Seventh Edition


Productivity
Productivity managerial pyramid

  • A measure of output achieved divided by input required

  • Higher level of output for a given level of input means greater productivity

  • Measured by OPMH

Principles of Information Systems, Seventh Edition


Return on investment and the value of information systems
Return on Investment and the Value of Information Systems managerial pyramid

  • Earnings growth

  • Market share

  • Customer awareness and satisfaction

  • Total cost of ownership

Principles of Information Systems, Seventh Edition


Roles functions and careers in the information systems department
Roles, Functions, and Careers in the Information Systems Department

  • Primary responsibilities in information systems

    • Operations: focuses on the efficiency of information systems functions

    • Systems development: focuses on specific development projects and ongoing maintenance and review

    • Support: provides user assistance

Principles of Information Systems, Seventh Edition


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