Information system and company growth

1. Information system and company growth Conférence invitée, Université de Mansfield, PA, USA, 30 janvier 2003 Maryse Colletis-Salles

2. Information system and company growth Dr. Maryse Colletis-Salles

3. Our approach • Our goal: to put in place good information systems to improve company/organization performance • A question: how to conceive such systems? • Our orientation: to start from the company/organization needs What it means to have good performance

4. What does a performing organization have to do? • To understand its missions and its nature • Who it is serving, what ethical frame applies to it . . . • What its core competence is • To understand its environment and anticipate changes • What its markets, customers/users expectations are • What the competitors, potential partners are • What foreseeable technological advances are • To conceive • A new product, a new process, a new organization • A new market • To decide • A new location, discard some activities, modify pricing • To act • To produce, to sell, to organize

5. Organizations as thinking beings • Organizations have their own capabilities • to solve problems and create new knowledge • that do not exist at the level of each component • and are not simply the sum of all components capabilities • How does the information system contribute to develop this knowledge and these capabilities?

6. Outline • What is an information system? • How does it appear, develop, and how is it managed? • Different types of information systems • The role and influence of information technology (IT) on an information system (IS)

7. What is an IS? “the whole of signifying formal and informal symbols in circulation within an organization” • Any organization (any system) can be broken down into 3 sub-systems • the “operating” (doing, producing) sub-system that performs the very mission of the system • the information sub-system, whose role is to represent all material or immaterial entities (flows, actors, products, tools) appearing in the company • The decision sub-system, establishing the objectives for the operating sub-system, controlling and regulating it • Therefore the IS is a language

8. A language to do what? • To distinguish and describe: • the company itself • the objects it produces or uses • processes structuring its activity • immediate environment (external actors with whom it interacts) • its broader environment • As any language, the IS is: • a model, a filtering system, a representation of reality • what is not named does not exist • It is important to manage this language, this IS

9. How does an IS develop? An IS has diverse origins • in part, the company develops it internally • in part, it is imposed from the outside; the company has to adopt it • in part, the company elaborates this language in cooperation with its partners, in order to work with them on shared projects Certain parts of the IS are comparatively easy to build, others are more complex

10. What are the objectives of managing the IS? • To manage the IS is to conceive it, to implement it, to operate it . . . • In order to bring changes to the companyrepresentation system . . . • To: • warrant company cohesion, i.e. secure a stable common language • favor the emergence of new representations, and regulate them

11. The components of the IS • Common information system • Specialized information system • Individual information system • Those 3 types of IS are linked by a higher level structure: the Cooperative information system

12. The Common IS • The Common IS: a collective language representing entities related in one way or the other to all company members • products, organization chart, accounting plans • The difficulty appears to be the semantic level and not the lexical one • The Common IS is stable, non-evolving; it is very often computerized • It guaranties the necessary coherence of the company

13. The Specialized IS • It is a language common to all the actors of a sector of the company (service, subsidiary, office, profession…) • It is a specific and detailed language • stock control department will add its own information to describe products: maximal storage life, out of stock warning level, preferred location • It is mostly computerized in companies, but not always in local government and institutions

14. The Individual IS • It is the representation system that the actors of the company build for their own use • It is the necessary disorder that might bring a new order, i.e. new representations that can be shared by a group or by all • It is not appreciated by computer system specialists

15. The Cooperative IS • It organizes exchanges between various actors or parts of the system in order to: • make cooperation possible between them • facilitate the collaboration towards creating new knowledge • The Cooperative IS is conveyed by three means: • means of communication (in a physical sense) • means of sharing data (how various actors modify the data they have accumulated on “objects ,” how they transfer or acquire data produced by other actors) • means of cooperation at work (how various actors’ actions can be organized within a process, a project) • IT has increased tremendously the capacities of Cooperative IS, but it did not created them, and is not in a capacity to do so

16. The risks of an imbalance in the management of the various IS • A reminder of the two objectives of managing the IS • to insure company cohesion through a shared language • to favor the appearance of new representations • A major risk: to favor one of the objectives above the other • The temptation exists to “collectivize” all Specialized IS in order to create a single global Common IS that would be complete and extremely detailed with the risk of sclerotic uniformity • The opposite temptation is a generalized “permissiveness ,” a multiplication of horizontal contacts, poorly controlled, that may lead to an atomization of the company (with some categories of factors fixing their own objectives and their own evaluating processes), as well as to a risk of hyper-reactivity

17. The role of IT in the IS • Because of its own potential, IT has a determining role in the IS management • By helping to formalize and structure information in a way that promotes sharing it, IT is a great ally of the Common and Specialized IS • Since it gives a form to information that lacks one, IT can end up freezing the organization,without necessarily wanting that to happen • But IT can be a powerful leverage to put in place re-organizations that have been decided (for example in the case of business process reengineering—BPR)

18. IT in a company: What’s at stake? • “[There is] no significant positive productivity impact from IT investment, no relationship between expenses for computers and business profitability, no process innovation, except for companies that changed their work process radically” (Strassman) • According to Solow, “You see computers everywhere, except in productivity statistics” • What’s at stake with IT is linked to what happens in the IS and is more organizational than technical • See for example the difficulties in implementing some types of computerized systems (ERP in particular)

19. People above the machine • The Web and associated tools (search engines and intelligent agents) are thought to have tremendously facilitated access to useful information for decision makers • Some authors are skeptical • “The information that today’s decision makers can access after implementing all these costly technologies, is not of a higher quality than that they received prior to doing it” (Davenport) • Information useful for the company performance is information that has been interpreted, i.e. treated by humans