csis 114 lab 6 organizational culture and structure l.
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0. CSIS 114 Lab 6: Organizational Culture and Structure. 0. Part 1: Organizational culture. Shared understandings, values & assumptions in an organization Influences information systems Siena and IBM example. 0. IBM’s culture. Lifetime employment (up until 1987 !)

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part 1 organizational culture

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Part 1:Organizational culture
  • Shared understandings, values & assumptions in an organization
  • Influences information systems
  • Siena and IBM example
ibm s culture

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IBM’s culture
  • Lifetime employment (up until 1987 !)
  • Social interaction: Kingston Country Club
  • Conservative dress
  • Our computers are the best
  • Other companies make computers, too?
siena s culture

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Siena’s Culture
  • Men with brown robes: Franciscan influence.
  • ROTC.
  • Strong athletic program and alumni support.
  • Academics: Liberal arts.
  • Students: mostly regional, Irish/Italian.
culture characteristics low or high on scale

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Culture Characteristics:low or high on scale
  • Innovation & Risk taking – encouraged?
  • Attention to detail – precision, analysis
  • Outcome orientation (vs process)
  • People orientation - consideration
  • Team organization – work activities
  • Aggressiveness - competitiveness
  • Stability – status quo
function of culture

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Function of Culture
  • Distinguishes organization from others
  • Conveys sense of identity to members
  • Commitment to group rather than self
  • Enhance social system stability – guidelines for behavior
  • Encourages conformity (control) - rewards
creating and maintaining culture

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Creating and maintaining culture
  • Stories - history
  • Rituals
  • Language – jargon or slogans
  • Material symbols: dress codes, office space, furnishings, other perks, rewards system
part 2 organizational structures

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Part 2:Organizational structures
  • Define organizational structure, and explain how they affect work processes and the implementation of information systems that should empower and support workers.
organizational structure influences information flow

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Organizational Structureinfluences information flow

Lines of communication

  • Formal
  • Informal : IT makes CEO more accessible. Relationships make business processes work.
  • Vertical (control) vs Horizontal (collaborative)
organizational structure approaches

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Organizational StructureApproaches
  • Traditional – hierarchy
    • Industrial revolution and earlier
    • “command and control”
    • Rote work by unskilled staff
  • Flat
  • Project
  • Team
  • Multidimensional
flat organizational structure

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“Flat” Organizational Structure
  • Less middle managers
    • Less up/down (filtering) communication
  • Empowerment of staff – via IS
  • Faster action and Lower costs
      • EX: Insurance rep handles entire case
      • Cable TV help desk can make decisions and provide refunds/extras (up to certain amount)
  • Be careful about becoming too flat: sometimes managers can see the big picture or resolve longer-term problems.
dell sales force structure changed to accommodate growth

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DELL: Sales force structure changed to accommodate growth
  • Maintained double-digit sustained growth by market segmentation.
  • Each group has specific customers that they specialized in.
  • Each group was close-knit and entrepreneurial.
  • As sales grew, company split off more specialized groups- see next slide.
team organizational structure

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Team Organizational Structure
  • Work groups of various sizes
    • Temporary or permanent teams
    • Peer pressure to perform
    • Each member learns all functions of team
    • Team can even make budgetary and hire/fire decisions
gore s innovative organization model makers of gore tex

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Gore’s innovative organization model (makers of Gore-Tex)
  • Split divisions when they reach > 150 people.
  • Research indicates that people don’t feel part of community that is too large.
    • EX: Shakers split “families” that are too large.
  • No managers, just “mentors”
    • Titles, offices don’t mean a thing.
multidimensional matrix organizational structure

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Multidimensional (matrix) Organizational Structure
  • May incorporate several structures at the same time
  • Advantage:
    • ability to simultaneously stress both traditional corporate areas and important product lines
    • Two mentors
    • Flexibility to move people within functional area
  • Disadvantage:
    • multiple lines of authority
virtual organizational structure diverse groups act as a single entity

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Virtual Organizational Structure:diverse groups act as a single entity.
  • Employs business units in geographically or organizationally dispersed areas
    • Southwest airlines: Moms handle reservations at home
    • Contract out work to specialty shops
  • Can be permanent or temporary.
  • IS must support&coordinate virtual distributed organization. [e-mail, scheduling, videoconferencing, etc.] since workers mostly communicate electronically.
organizational innovation

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Organizational innovation
  • Downsizing - “rightsizing”
  • Vertical Integration
    • own all phases of production
  • Horizontal Integration (conglomerates)
    • Going into other lines of business
    • Acquisitions and mergers
  • Keiretsu: Japan’s answer to conglomerates
    • Can be either vertical or horizontally integrated
  • Virtual Integration
    • Business Web value chains: act as one company.
    • EX: Dell and its suppliers. CISCO and manufacturers.
  • Partnerships / Cooperation
  • Outsourcing/off shoring
downsizing

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Downsizing
  • Downsizing: “rightsizing”
    • cutting the number of employees by layoffs
    • or hiring freeze
    • or reorganization (sell off business units)
part 3 outsourcing and offshoring ch 14 in o brien

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Part 3: Outsourcing and offshoring(ch. 14 in O’Brien)
  • Outsourcing: contracting with outside company (within U.S. or not)
    • American Express hires IBM to manage servers, databases and helpdesk.
    • Other company may hire foreign nationals that may reside in U.S.
when to outsource

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When to outsource?
  • When you can cut costs.
  • Limited opportunity to distinguish competitively through the function.
  • When uninterrupted service is not critical.
  • When technical know-how can be maintained internally.
  • When existing IS function is ineffective or inferior. [Stair, p 523]
offshoring ch 14 in o brien

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Offshoring(ch. 14 in O’Brien)
  • Also known as: Off-shore outsourcing
    • More specific term than outsourcing.
    • Contract out to (or own) offshore company
      • GE, Texas Instruments have subsidiaries in India
    • Move sophisticated work to another country to take advantage of lower cost structures (finance, banking, call center, IT services: programming, system management).
    • Countries with innovative, educated in IT/engineering, English speaking, workers are successful.
    • Near-shoring to Canada: less cultural differences
off shoring projections

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Off-Shoring projections
  • Gartner Inc. predicts that 40% of companies with revenue of more than $100 million will be trying out or using offshore services by the end of 2004.
  • Gartner also predicts that one in 20 IT jobs will head offshore by the end of 2004.
  • Cambridge, Mass.-based Forrester Research Inc. projects that more than 3 million U.S. white-collar jobs will be lost to offshore outsourcing during the next 10 years or so -- a half-million of them in IT.
off shoring case

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Off-shoring Case
  • Pro and Con analysis.