1. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Information Systems Management in the Global Economy Chapter 1 Information Systems Management in Practice 8 th Edition

2. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Chapter 1–Outline & Objectives Introduction The Organizational Environment The Technology Environment A Simple Model A Better Model 1-2

3. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Introduction Information technology (IT) is a pervasive element of society today and has revolutionized and restructured many aspects of human endeavor, including work. This book emphasizes the use of IT in managing and operating organizations. 1-3

4. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Introduction Globalization Worldwide expansion of brands and the emergence of global institutions after World War II IS organization must balance global IT enterprise goals with local systems needs E-enablement Leveraging of IT to build relationships with consumers and other enterprises in general 1-4

5. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Introduction Business intelligence through knowledge sharing and knowledge management Transfer of knowledge between people Elicit tacit knowledge that people possess Outsourcing Outsourcing: Development and management of relationships with external service providers 1-5

6. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura The Organizational Environment External forces that cause IS executives to re-examine how their firms compete and internal structural forces that affect how organizations operate or are managed. External business environment Internal organizational environment Goal of new work environment 1-6

7. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura External Business Environment: External forces that cause IS executives to re-examine how their firms compete The main Changes in the external business environment: 1. Internet economy IT underpins old and new ways of doing business  Physical and electronic marketplace 2. Global Marketplace Internet has speeded up firms’ internationalization process Born global: Think globally, act locally 1-7 The External Business Environment

8. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura The External Business Environment 3. Micro-markets Have a selling price that is very low, fixed, and identical for all products Price is no longer the primary demand factor. Alternatively, quality signal is likely to become a key demand factor Impact of price on quantity Example: Digital microproducts  iTunes, Amazon shorts, Disney short videos 4. Business ecosystems Relationships and growth that are organic in nature Example: Microsoft and Intel dominated the PC world 1-8

9. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura The External Business Environment cont’d 5. Decapitalization Emphasis on intangible assets like ideas and knowledge and not on tangible assets like equipment and buildings 6. Faster business cycles First-mover advantage Work fast and reduce cycle time to develop new products 7. Instant gratification (immediate satisfaction) Example:  Youtube: instant viewing of video clips without the need to download large video files  Geogle search engine: instantly deliver relevant information 1-9

10. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura The External Business Environment cont’d 8. Accountability and transparency Greater transparency of corporate operations Greater accountability of corporate officers 9. Rising societal risks of IT Job losses due to technology substitution and outsourcing Information security  Network shutdown  Computer viruses  E-mail spams 1-10

11. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura The Internal Business Environment Internal Business Environment: internal structural forces that affect how organizations operate or are managed The main Changes in the internal business environment: 1. From supply-push to demand-pull Customer-centric philosophy  Value co-creation with customer  Example: Amazon.com’s reviews 2. Self-service (Customer empowerment) Customers know what they want best Example: ATMs, FedEx package tracking system 1-11

12. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura The Internal Business Environment 3. Real-time working Derive competitive advantage Example: library search, plane reservation 4. Team-based working The trend is toward people working together as teams on projects and tasks rather than depending on chains of command and the authority of the boss. 5. Anytime, anyplace information work Anytime: Work conducted cross time zones Anywhere: Working at home, while traveling, or on the customer site in addition to working at the office Example: e-mail, voice mail, instant messaging (IM) 1-12

13. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura The Internal Business Environment cont’d 6. Outsourcing and strategic alliances To become competitive, organizations are examining which work should perform internally and which should be given to others (by outsourcing) Outsourcing, having a third party perform information work for you, may be a simple contract for services or a long term strategic alliances 7. Demise of hierarchy Flatter organization (employee empowerment)  Lower absenteeism  Higher productivity  Higher quality work  Highly motivated 1-13

14. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Business Strategies in the New Work Environment Main goals for thriving in the new work environment 1. Leverage (Force) knowledge globally Knowledge is now being called intellectual capital to signify its importance Tap into intellectual capital across the entire enterprise Two types of knowledge:  Tacit knowledge: knowledge that people know but cannot really explain to others  Explicit Knowledge: knowledge that people can explain to others 1-14

15. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Business Strategies in the New Work Environment 2. Organize for complexity Interconnectivity and interdependence of businesses  Environment Impact  Human resource impact  Economic impact  Ethical impact Choices are so numerous that consumers can spend an unreasonable amount of time making a decision 3. Work electronically Concept of the workspace Taking advantage of internet 1-15

16. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Business Strategies in the New Work Environment 4. Handle continuous and discontinuous change Built to change  Total quality management (continuous)  Product or process is just fine, but needs some tuning  Reengineering (discontinuous)  Product or process is not fine and we need to move to an entirely new product or way of working 1-16

17. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura The Technology Environment The technological (IT) environment has a symbiotic relationship with organizational structure (co-evolution) Four traditional areas that describes the IT evolution: Hardware Trends Software trends Data trends Communication trends 1-17

18. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Hardware Trends Movement of central administration to distributed computing 1950s and 1960s (mainframe) Mainframe, batch-processing, back-end data centers Hardware was centralized 1970s (minicomputer) Some independence at the department level 1980s and early 1990s (personal computer) PCs greatly accelerated process of decentralization  Client-server model Late 1990s and 2000s (Web, networks and mobile/handheld) Centralized computing via networks and the Internet 1-18

19. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Software Trends Transaction processing application development Focus on improving productivity of programmers Life cycle development methodology Focus on strict project management techniques Prototyping Purchased software vs. in-house development “Programming” shifted to end-users Focus on applications rather than transaction processing 1-19

20. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Software Trends Open systems software vs. proprietary software Enterprise resource planning (ERP) systems Tightly integrate various functions of an enterprise so that management can see cross-functional figures Replace legacy systems that were not Y2K compliant (year 2000) 1-20

21. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Software Trends Web services—service oriented architecture (SOA) Web Service: packages of code that each perform a specific function and have a URL so that they can be located via the internet to fulfill a request. Service oriented architecture: architecture that uses loosely coupled applications or services to support the requirement of business process Process modified without software modification 1-21

22. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Data Trends 1970s: Technical solutions for managing data Database management systems (DBMS) Centralized environment for first 20 years 1990s: Shift toward managing information resources Concepts/ideas as a function of raw data Voice, video, graphics, animation Decentralized environment 2000s: Web content management Standardize formats of and make interoperable huge amounts of data on Web sites 1-22

23. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Communications Trends 1980s: Enterprise networking Local area networks (LAN) within organization site Wide area networks (WAN) between organization sites 1990s onwards: Internet convergence of telecommunications and information systems Invention of modulator/demodulator (MODEM) Internet protocols (TCP/IP) Voice over IP Wireless technologies 1-23

24. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura A Simple Model cont’d 1-24 The simple model is used to describe IS functions in organizations Figure 1-2 represents the process of applying IT to accomplish useful work System analyst translate users needs into systems

25. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Figure 1-3 describes the increasing power and complexity of IT that users have become increasingly sophisticated More specialization required of IS professionals (information specialist) Users have become increasingly sophisticated IS are now viewed as system products and Users have become customers A Simple Model cont’d 1-25

26. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura A Simple Model cont’d 1-26 Figure 1-4 depicts the increasing IT sophistication and efficacy of users End user computing  Employees can develop their own applications  Non-IT staff can handle some applications

27. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura A Better Model 1-27

28. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura A Better Model cont’d Figure 1-6 is an expanded model with four principal elements to describe IS function 1. The technology A set of technologies that represent the IT infrastructure installed and managed by the IS department 2. The Users A set of users who need to use IT to improve their job performance (Figure 1-5)  Support procedure-based activities  Support knowledge-based activities (goal-based) 1-28

29. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura A Better Model cont’d 1-29

30. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura A Better Model cont’d 3. System development and delivery A delivery mechanism for developing, delivering and installing applications Bridging the gap between technology and users 4. IS Management Executive leadership to manage the entire process of applying the technology to achieve organizational objectives and goals Executive team must work together to govern and leverage IT well  C-level executives, divisional and department heads 1-30

31. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Review IT vs. IS Outsourcing Micro-market Faster business cycles Instant gratification Supply-push to demand-pull Self-service Real-time working 1-31

32. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Review Team-based working Anytime, Anywhere information works Demise of hierarchy Tacit knowledge Vs. Explicit knowledge Built to change Four areas of Technology Environment Enterprise Resource Planning (ERP) Web service Service Oriented Architecture (SOA) 1-32

33. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura Review 1-33

34. © 2009 Pearson Education, Inc. Publishing as Prentice Hall Edited by: Raneem Qaddoura 1-34 Review