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Management Information Systems - Class Note # 4 (Chap-3)

Management Information Systems - Class Note # 4 (Chap-3). Prof. Yuan-Shyi Peter Chiu Feb. 2011. Chap. 3. Information Systems, Organizations, Management, and Strategy. 3.1 Organizations & Information System 3.2 The Changing Role of Information Systems in Organizations

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Management Information Systems - Class Note # 4 (Chap-3)

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  1. Management Information Systems - Class Note # 4(Chap-3) Prof. Yuan-Shyi Peter Chiu Feb. 2011

  2. Chap. 3 Information Systems, Organizations, Management, and Strategy 3.1 Organizations & Information System 3.2 The Changing Role of Information Systems in Organizations 3.3 Managers, Decision Making, and Information Systems 3.4 Information Systems and Business Strategy

  3. 3.1 Organizations & Information System ORGANIZATION Technical Definition: Stable, Formal, Social Structure  Takes Resources From Environment  Processes Them  To Produce Outputs

  4. 3.1 Organizations & Information System Fig 3-2: The Technical view of Organizations .

  5. 3.1 Organizations & Information System ORGANIZATION  Behavioral Definition : Collection Of  Rights, Privileges, Obligations, Responsibilities  Delicately Balanced  Conflict Resolution

  6. INFORMATION TECHNOLOGY ORGANIZATIONS 3.1 Organizations & Information System Fig 3-1: The Two-way relationship b/w Organizations and I.S. MEDIATING FACTORS:Environment Culture Structure Standard Procedures Business Processes Politics Management Decisions Chance

  7. 3.1 Organizations & Information System Structural Characteristics of All Organizations • Clear Division Of Labor • Hierarchy • Explicit Rules & Procedures • Impartial Judgments • Technical Qualifications • Maximum Organizational Efficiency

  8. 3.1 Organizations & Information System Common Features of Organizations • Formal Structure • Standard Operating Procedures • Politics • Culture

  9. 3.1 Organizations & Information System Unique Features of Organizations • Organizational Types • Environments, Goals, Power • Constituencies, Function • Leadership, Tasks • Technology • Business Processes

  10. Figure 3-4 3.1 Organizations & Information System Organization & Its Environment

  11. 3.1 Organizations & Information System Table 3-3: Summary of Salient Features of Organizations.

  12. 3.2 The Changing Role of Info Systems In Organizations Fig 3-5: Information Technology Services.

  13. 3.2 The Changing Role of Info Systems In Organizations How Information Systems affect Organizations The Impact of Information Systems on Organization  Reduces  Operating costs  Reduces  Organizational size – middle managers – clerical workers

  14. 3.2 The Changing Role of Info Systems In Organizations How Information Systems affect Organizations  Changes  Organizational Structure – decentralize – less reliance on SOPs  Increase  Information and knowledge workers  Self- guided workers – information access: automated, timeliness, and accuracy  Shortens  Decision Making Process

  15. 3.2 The Changing Role of Info Systems In Organizations How Organizations Affect Information Systems ? • Decisions about The Role of information systems • Decisions about The Computer Package : - Who delivers information technology services ? • Decisions about Why information systems are built ?

  16. 3.2 The Changing Role of Info Systems In Organizations Fig 3-8: Organizational Resistance and the mutually adjusting relationship between technology and the organization.

  17. 3.2 The Changing Role of Info Systems In Organizations Internet & Organizations The internet increase the ■Accessibility ■Storage ■Distribution of Info & Knowledge For organizations ■Lowering the transaction and agency costs ◆

  18. 3.3 Managers, Decision Making, and Information Systems Role Of Managers Classical Descriptions of Management Describe functions- plan, organize, coordinate, decide, control Behavioral Models Based on observations of managers on the job

  19. 3.3 Managers, Decision Making, and Information Systems What Managers Do ? • Behavioral modelof management activities :  High-volume, High-speed work  Variety, Fragmentation, Brevity  Issue preference current, ad hoc, specific  Contacts, complex web of interactions  Strong preference for verbal media  Control of the agenda

  20. 3.3 Managers, Decision Making, and Information Systems Managerial Roles:Mintzberg (1971)  Interpersonal roles  Figurehead  Leader  Liaison  Informational roles  Nerve center  Disseminator  spokesperson

  21. 3.3 Managers, Decision Making, and Information Systems Managerial Roles:Mintzberg (1971)  Decisional roles  Entrepreneur  Disturbance handler  Resource allocator  Negotiator

  22. 3.3 Managers, Decision Making, and Information Systems ◇ How information systems can benefit managers ?  What managers do ?  What information managers need for decision making ?  How decisions are made ?  What kinds of decisions can be supported by formal information systems ?

  23. 3.3 Managers, Decision Making, and Information Systems

  24. 3.3 Managers, Decision Making, and Information Systems Levels of Decision Making Operational control Strategic decision making Knowledge- level decision making Management control

  25. 3.3 Managers, Decision Making, and Information Systems Decisions are classified as: • Unstructured: Non routine, decision maker provides judgment, evaluation, and insights into problem definition, no agreed-upon procedure for decision making • Structured: Repetitive, routine, handled using a definite procedure

  26. ORGANIZATIONAL LEVEL TYPE OF DECISION OPERATIONAL KNOWLEDGE MANAGEMENT STRATEGIC ACCOUNTS STRUCTURED RECEIVABLE PRODUCTION ELECTRONIC COST OVERRUNS SCHEDULING TPS SEMI- BUDGET MIS OAS STRUCTURED PREPARATION PROJECT SCHEDULING FACILITY DSS LOCATION ESS KWS UNSTRUCTURED PRODUCT DESIGN NEW PRODUCTS NEW MARKETS 3.3 Managers, Decision Making, and Information Systems Fig. 3-9: Different kinds of information systems at the various organization levels support different types of decisions.

  27. 3.3 Managers, Decision Making, and Information Systems Fig 3-10: The decision making process.

  28. 3.3 Managers, Decision Making, and Information Systems 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

  29. 3.3 Managers, Decision Making, and Information Systems Management Challenges Unstructured nature of important decisions Diversity of managerial roles Complexity of decision making

  30. 3.4 Information Systems and Business Strategy Strategic Information Systems ( S.I.S ) Computer systems at any level of the organization that change The goals, operations, products, services, or environmental relationships, to help the organization gain a competitive advantage .

  31. 3.4 Information Systems and Business Strategy Fig. 3-15: Porter’s competitive forces model

  32. 3.4 Information Systems and Business Strategy Competitive forces model  Model used to describe the interaction of external influences, specially threats and opportunities, that affect an organization’s strategy and ability to compete. ◆

  33. 3.4 Information Systems and Business Strategy Four basic Competitive Strategies Product Differentiation Focused Differentiation Tight Linkages to customers & suppliers Low-cost producer • New & Unique • Products and • Services • ATM by Citibank • C-M-A by Merrill • Lynch • New Market Niches • for specialized • Products or Services • Sears Roebuck • American Express • “Lock” customers & • Suppliers ; • Raises Switching • Costs • Federal Express • Baxter International • Wizard by Avis • C-R-S by • Wal-Mart • Yield mgmt by • Airlines

  34. 3.4 Information Systems and Business Strategy Competitive forces model Data-mining Analysis of large pools of data to find patterns and rules that can be used to guide decision making and to predict future behavior. Switching Costs The expense a customer or company incurs in lost time and expenditure of resources when changing from one supplier or system to a competing supplier or system.

  35. 3.4 Information Systems and Business Strategy Fig. 3-13: Stockless inventory compared to traditional and just-in-time supply methods. ◆

  36. 3.4 Information Systems and Business Strategy Value Chain model Model that highlights theprimary or support activities that add a margin of value to a firm’s products or services where information systems can best be applied to achieve acompetitive advantage.  Primary Activities Activities most directly related to the production and distribution of a firm’s products or services .  Support Activities Activities that make the delivery of a firm’s primary activities possible. Consists of the organization’s infrastructure, human resources, technology, and procurement.

  37. 3.4 Information Systems and Business Strategy Figure 3-11

  38. Figure 3-14 3.4 Information Systems and Business Strategy Business-Level Strategy

  39. 3.4 Information Systems and Business Strategy Competitive Forces Model The Value Chain Model Strategic Information Systems

  40. 3.4 Information Systems and Business Strategy What managers should do ?  How is the industry currently using information systems ?  Can significant strategic opportunities be gained by introducing newinformation system technology ?

  41. 3.4 Information Systems and Business Strategy What managers should do ?  What is the current business strategic plan, and how does that plan meshwith the current strategy for information services ?  Does the firm have the technology and capital required to develop a strategic information systems initiative ?

  42. HOMEWORK CHAP.3 # 1 What are the Mediating Factors between organizations and Information Technology ? # 2 Describe briefly what common features and unique features of organizations are? # 3 Describe how information systems affect organizations; and how organizations affect information systems. # 8 What specific managerial roles can information systems support ? Where are information systems particularly strong in supporting managers, and where are they weak? # 9 What are the four stages of decision making described by Simon? # 12 What is a strategic information system? # 13 Describe what competitive forces model and value chain model are? Name four basic competitive strategies. # 14 What managers should do after understanding the impact of strategic information system? ~ THE END ~

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