1. Information Systems, Organizations, Management, and Strategy
Chapter 3
Information Systems, Organizations, Management, and Strategy

2. Evaluate the impact of information systems on organizations
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
OBJECTIVES
Identify and describe important features of organizations that managers need to know about in order to build and use information systems successfully
Evaluate the impact of information systems on organizations
Assess how information systems support the activities of managers in organizations

3. Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
OBJECTIVES (Continued)
Analyze how information systems support various business strategies for competitive advantage
Assess the challenges posed by strategic information systems and management solutions

4. Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
The Relationship between Organizations and Information Technology is influenced by mediating factors
Figure 3-1
Managers need to understand how IS can change social/work life in their org.

5. Organization: What Is an Organization? Stable, formal social structure
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
What Is an Organization?
Organization:
Stable, formal social structure
Takes resources from the environment and processes them to produce outputs which returns (capital) as input

6. The Technical Microeconomic Definition of the Organization
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
The Technical Microeconomic Definition of the
Organization
Figure 3-2

7. Behavioral Definition of Organization:
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
Behavioral Definition of Organization:
Collection of rights, privileges, obligations, and responsibilities that are
Delicately balanced over a period of time through conflict and
Conflict resolution

8. The Behavioral View of Organizations
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
The Behavioral View of Organizations
Figure 3-3

9. Shared Features of all Organizations:
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
Shared Features of all Organizations:
Clear division of labor
Hierarchy
Explicit rules and procedures
Impartial judgments
Technical qualifications for positions
Maximum organizational efficiency
Table 3-1

10. Routines and Business Processes
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
Routines and Business Processes
Routines are patterns of individual behavior.
Business processes are a collection of routines.
Business firms are a collection of business processes.
Business processes enable organizations to cope with all recurring expected situations.

11. Unique Features of Organizations
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
Unique Features of Organizations
Structures
Goals
Constituencies
Leadership styles
Tasks
Surrounding environments

12. Organizational Structures
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
Organizational Structures
Entrepreneurial structure: Small start-up business
Machine bureaucracy: Midsize manufacturing firm
Divisionalized bureaucracy: Fortune 500 firms
Professional bureaucracy: Law firms, school systems, hospitals
Adhocracy: Consulting firms

13. Organizing the IT Function
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
Organizing the IT Function
The information systems department is responsible for maintaining:
Hardware
Software
Data storage
Networks

14. Information Technology Services
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
Information Technology Services
Figure 3-6

15. IS Department in an organization includes:
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
ORGANIZATIONS AND INFORMATION SYSTEMS
IS Department in an organization includes:
Programmers: writers of the software instructions for computers
Systems analysts: Translate business problems into solutions, act as liaisons between the information systems department and rest of the organization
Information system managers
Chief Information Officer (CIO): Senior manager in charge of information systems function in the firm
End users:

16. Organizational and Behavioral Impacts
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
HOW INFORMATION SYSTEMS IMPACT ORGANIZATIONS AND BUSINESS FIRMS
Organizational and Behavioral Impacts
IT Flattens Organizations:
Facilitates flattening of hierarchies
Broadens the distribution of timely information
Increases the speed of decision making
Empowers lower-level employees to make decisions without supervision
Increases management span of control (the number of employees supervised by each manager)

17. Flattening Organizations
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
HOW INFORMATION SYSTEMS IMPACT ORGANIZATIONS AND BUSINESS FIRMS
Flattening Organizations
Figure 3-9
Flattening involves business process re-engineering.

18. HOW INFORMATION SYSTEMS IMPACT ORGANIZATIONS AND BUSINESS FIRMS
Virtual Firms:
Use networks to link people, assets, and ideas
Can ally with suppliers, customers to create
and distribute new products and services
Not limited to traditional organizational boundaries
or physical locations
call centers in India, production in China, product development in US, finance & acct in Cayman Islands, etc.

19. The Role of Managers in Organizations
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
THE IMPACT OF IT ON MANAGEMENT DECISION MAKING
The Role of Managers in Organizations
Classical Descriptions of Management:
Traditional description of management
Focuses on formal functions: Plan, organize, coordinate, decide, control
Managerial Roles:
Expectation of activities that managers should perform in an organization

20. Interpersonal: Managers act as figureheads and leaders.
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
THE IMPACT OF IT ON MANAGEMENT DECISION MAKING
Managerial Roles:
Expectation of activities that managers should perform in an organization
Interpersonal: Managers act as figureheads and leaders.
Informational: Managers receive and disseminate critical information, nerve centers.
Decisional: Managers initiate activities, allocate resources, and negotiate conflicts.

21. Models of Decision Making
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
THE IMPACT OF IT ON MANAGEMENT DECISION MAKING
Models of Decision Making
Rational model: An individual manager identifies goals, ranks all possible alternative actions and chooses the alternative that contributes most to those goals (Utilitarianism)
Is it always possible to find all possible alternatives and rank them according to how they contribute to a goal?
Is it possible to always know how an action will contribute to a goal?

22. Models of Decision Making (Continued)
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
THE IMPACT OF IT ON MANAGEMENT DECISION MAKING
Models of Decision Making (Continued)
Organizational model: Considers the structural and political characteristics of an organization
Bureaucratic model: Whatever organizations do is the result of routines and existing business processes honed over years of active use
Political model: What an organization does is a result of political bargains struck among key leaders and interest groups
Garbage Can model: take first available alternative that looks good

23. IT plays a powerful role in creating new forms of business ecosystems.
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
INFORMATION SYSTEMS AND BUSINESS STRATEGY
Business Ecosystems:
IT plays a powerful role in creating new forms of business ecosystems.
Business ecosystems are inter-dependent networks of
suppliers, distributors, outsourcing firms, transportation service firms, and technology manufacturers.

24. Intel, AMD, music industry, …
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
INFORMATION SYSTEMS AND BUSINESS STRATEGY
Business Ecosystems:
Examples:
Microsoft: 1 billion PCs worldwide and hundreds of thousands of businesses rely on Microsoft’s platform.
Intel, AMD, music industry, …
EBay: Millions of people and thousands of business firms use this platform.
Wal-Mart: Enterprise systems used by suppliers to increase their efficiency

25. Evaluate the impact of information systems on organizations
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
OBJECTIVES
Identify and describe important features of organizations that managers need to know about in order to build and use information systems successfully
All modern organizations have similarities & differences
Evaluate the impact of information systems on organizations
IS & organizations mutually influence one another
Assess how information systems support the activities of managers in organizations

26. Organizational inertia (to changing)
Management Information Systems
Chapter 3
Information Systems, Organizations, Management, and Strategy
OBJECTIVES (Continued)
Analyze how information systems support various business strategies for competitive advantage
Assess the challenges posed by strategic information systems and management solutions
Maintaining competitive advantage (easy to copy IS of other firms, technology changes)
Organizational inertia (to changing)