MIS 2000 Organizations and Information Systems – Impact on Organizational Design

1. MIS 2000 Organizations and Information Systems – Impact on Organizational Design (slightly revised, see outline)

2. Outline • Two typologies of Information Systems • Organization design (structure, processes, culture, politics—deleted due lack of time; also minor revision of slide 11) • Relationships b/w organization design and Information Systems

3. IS Types - Organizational Function Served • Back-end: Purchasing Systems – supply chain • Production Systems – Manufacturing, Services, involved in org. core business operations • Support to Production: HR, Accounting & Finance, Planning, Inventory, R+D, Engineering/Product Development • Front-end: Marketing & Sales Systems, Customer Relationship Mgt. (CRM) (customer tracking, sales recording, billing, competition/environment scanning, market segmentation) Supply Back-End Delivery Front End ORGANIZATION Production + Support MIS 2000 Information Systems for Management

4. IS Types – Data and User • Systems have different data, processing capabilities & deliverables • AND different Users Executive Management Strategic planning & control * Mid-level Management Mid-range performance control & planning Supervisory Management Knowledge Work Systems (professionals) Group Support Systems (everybody) Communication Systems (everybody) Everyday operations control • “Packing” systems together (see Note). • * Also called Reporting sys. or Admin. sys. The MIS area of study refers to all system types, not just MIS type of systems. MIS 2000 Information Systems for Management

5. Relationship Between Two Typologies • Different IS types based on data/user can be in each department. MIS 2000 Information Systems for Management

6. IS and Organizations • Organizations use systems to advance their organizational design (get organized better)and, consequently, to achieve economic gains. • Organizational Design: Composition of tasks and processes, departments, methods of management, stable beliefs & behaviors, power distribution… Information Systems Impacts Organization Organization Effectiveness of business Organizational Design Efficiency of operations Economic aspects MIS 2000 Information Systems for Management

7. IS and Organizations (cont.) • Operational Efficiency: Save time (on tasks…) & money (on materials, equipment, labour) • Business Effectiveness – accomplishing competitive targets: • New product (good or service) • Product differentiated from competitors’ • Market-related goals • Customer-related goals • Systems should advance methods of organizing and help to increase efficiency and effectiveness of organizations. MIS 2000 Information Systems for Management

8. Organization • Collection of individuals sharing work, following certain rules and using technology to produce certain good or service. • Organization takes inputs from the environment, transforms them, and puts the result out into the environment. • Organization can be viewed from the perspectives of • Structure • Processes • Culture • Politics MIS 2000 Information Systems for Management MIS 2000 Information Systems for Management

9. Organizational Structure • Organization of work: • tasks, procedures, processes, jobs • departments (functions; grouping of work); distribution of work in geographical space • Levels of management (Hierarchy) • Rules and regulations (Formalization) • Distribution of decision making power (Centralization) MIS 2000 Information Systems for Management MIS 2000 Information Systems for Management 7 of 15

10. IS Impact on Organizational Structure • Systems can directly impact organizational structure via changes in the organization of work (e.g., task modification) • Reduction of middle management (“flattening” of hierarchy) • Reduction of explicit rules & regulations (less written rules) • Broader distribution of decision making power (decentralization) MIS 2000 Information Systems for Management

11. Organizational (Business) Processes • Process view of organizations is newer than structural. Business process is a set of tasks from a start to an end point, that deliver a value for a customer. Process can cut across departments. MIS 2000 Information Systems for Management

12. IS Impact on Business Processes (BP) • IS used to support BP - Business Process Management (BPM). • Electronic linking of tasks & remote locations • Automated management of linked tasks • Measurement of time and quality enhanced • IS used to change BP – Business Process Reengineering (BPR). IS aids in making: • New BP possible (e.g., CRM, beyond org. boundaries) • Simpler, faster, less labour-intensive BP

13. Organizational Culture • Stable beliefs and behaviors shared among organization members. • Beliefs and behaviors related to data/information/knowledge & IST examples: • the role of IST in business (support vs. driver) • when to change IST (conservative vs. progressive) • proper communication (face-to-face vs. tech-mediated & which) • who should operate IST (all vs. specialists) • what is better – paper or electronic data format • knowledge culture (e.g.: 3M, Microsoft) • how to plan & develop IS, how to manage data MIS 2000 Information Systems for Management MIS 2000 Information Systems for Management

14. IS and Organizational Culture • Organizational culture is an important condition for developing and using IS • New IS can collide with organizational culture => • failure of IS, old culture resilient (some EMR* systems) • culture change required (ERP systems) • mutual adjustment of systems and culture (GSS) MIS 2000 Information Systems for Management

15. Mutual Influences IS—Organization • Important! IS do not influence organizational design one way, existing organization (structure, processes, culture, politics) impacts on new IS as well. • Mutual influencing, IS adjust to an organization, and the organization adjusts to IS. • The proportion of mutual adjustment is a matter of scale, depending on a particular organization. • System’s IT matters (flexibility)! Management of change matters (attention, persistence, initiatives)! IS Impacts Organization MIS 2000 Information Systems for Management