Week No. 2-Topic 2- IS in Organizations.pptx

Chapter 02: Information Systems In Organizations Stair, Reynolds and Chesney: Principles of Business Information Systems, Fourth edition (9781473774605) © Cengage Learning 2021 Principles • The use of information systems to add value to the organization is strongly influenced by organizational st...

Chapter 02: Information Systems In Organizations Stair, Reynolds and Chesney: Principles of Business Information Systems, Fourth edition (9781473774605) © Cengage Learning 2021 Principles • The use of information systems to add value to the organization is strongly influenced by organizational structure, and the organization’s attitude and ability to change. • Because information systems are so important, businesses need to be sure that improvements to existing systems, or completely new systems, help lower costs, increase profits, improve service, or achieve a competitive advantage. • Cooperation between business managers and IS personnel is the key to unlocking the potential of any new or modified system For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning An introduction to organizations • An organization is a formal collection of people and other resources established to accomplish a set of goals. • An organization is a system, which means that it has inputs, processing mechanisms, outputs, and feedback. • Resources such as materials, people, and money are the inputs • These go through a transformation mechanism, the processing. • The outputs from the transformation mechanism are usually goods or services, which are of higher relative value than the inputs alone. • Through adding value or worth, organizations attempt to achieve their goals For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning The Value Chain • The value chain is a useful tool for analyzing where and how this value gets added. • The value chain is a series (chain) of activities that includes inbound logistics, warehouse and storage, production, finished product storage, outbound logistics, marketing and sales, and customer service. For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning The Value Chain Forof use with Principles of Business Information For use with Principles Business Information Systems, 4e Systems, 3e by Stair, Reynolds &Reynolds Chesney by Stair, & Chesney © 2018Learning Cengage Learning © 2021 Cengage SCM and CRM • Supply Chain Management (SCM) and Customer Relationship Management (CRM) are two key parts of managing the value chain • SCM helps determine what supplies are required for the value chain, what quantities are needed, how they should be turned into finished products and shipped to customers. • Increasingly, SCM is accomplished using the Internet and B2B e-commerce • CRM programs help a company manage all aspects of customer encounters, including marketing and advertising, sales, customer service after the sale, and help retain loyal customers. For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Organizational structures • Organizational structure refers to organizational subunits and the way they relate to each other. An organization’s structure depends on its approach to management, and can affect how it views and uses information systems. • The types of organizational structures typically include: – – – – Traditional Project team virtual For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Traditional organizational structure • Hierarchy of decision making and authority flows from the strategic management at the top, down to operational management and non-management employees. • Today, the trend is to reduce the number of management levels, or layers, in the traditional organizational structure • This type of structure is often called a flat organizational structure For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Forof use with Principles of Business Information For use with Principles Business Information Systems, 4e Systems, 3e by Stair, Reynolds &Reynolds Chesney by Stair, & Chesney © 2018Learning Cengage Learning © 2021 Cengage Project and team organizational structures • A project organizational structure is centred on major products or services • Each major product has its own marketing, finance and production departments. • The team organizational structure is centred on work teams or groups • Teams can be small or large, permanent, or temporary. • A healthcare company, for example, could form small teams to organize its administrators, doctors, and others to work with individual patients. For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Forof use with Principles of Business Information For use with Principles Business Information Systems, 4e Systems, 3e by Stair, Reynolds &Reynolds Chesney by Stair, & Chesney © 2018Learning Cengage Learning © 2021 Cengage Virtual organizational structure • A virtual organizational structure is made up of individuals, teams, or complete business units that work with other individuals, teams, or complete business units in different geographic locations. • This almost always requires the use of the Internet (or other telecommunications) to facilitate communication. • The people might never meet physically, which is why they are called virtual. For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Organizational change • Most organizations are constantly undergoing change, both minor and major. • The need for organizational change can come from new managers, staff leaving, activities wrought by competitors or stockholders, new laws, natural occurrences (such as a hurricane), and changes in general economic conditions. • An new IS will cause change. For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Reengineering and continuous improvement • Reengineering, also called Process Redesign and Business Process Reengineering (BPR), involves the radical redesign of business processes, organizational structures, information systems, and values of the organization to achieve a success in business results. • Continuous improvement involves constantly seeking ways to improve business processes and add value to products and services. For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Technology Acceptance • Technology diffusion is a measure of how widely technology is spread throughout an organization. An organization in which computers and information systems are located in most departments and areas has a high level of technology diffusion. • Technology infusion is the extent to which technology permeates an area or department. In other words, it is a measure of how deeply embedded technology is in an area of the organization For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Competitive advantage • A competitive advantage the ability of a firm to outperform its industry, that is, to earn a high rate of profit than the industry norm. • It can result from higher-quality products, better customer service, and lower costs • Often, a competitive advantage will depend on a carefully designed information system. For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Evaluating IS • Once an information system has been implemented, management will want to assess how successful it has been in achieving its goals. Often this is a difficult thing to do, and many businesses do not attempt to take anything more than an informal approach to evaluation. • Some approaches to evaluating IS include: – Productivity: examine how output has changed since implementation (a measure of output achieved divided by input required) – Return on Investment: examine how profits have increased – Earnings Growth: another measure of profit increase – Market Share: examine the change in market share since implementation – Customer Awareness and Satisfaction: possibly qualitative measure of satisfaction – Total Cost of Ownership: estimate the total cost of the IS breaking cost into areas such as the cost to acquire the technology, technical support, administrative costs, and end-user operations For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Careers in Information Systems Operations: System operators primarily run and maintain IS equipment, and are typically trained at technical schools or through on-the-job experience. They are responsible for starting, stopping and correctly operating mainframe systems, networks, back-up drives, disc devices, printers and so on. Systems Development The systems development component of a typical IS department focuses on specific development projects and ongoing maintenance and review. Systems analysts help users determine what outputs they need from the system and construct plans for developing the necessary programs that produce these outputs. A computer programmer uses the plans the systems analyst created to develop or adapt one or more computer programs that produce the desired outputs. For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Careers in Information Systems Support The support component of a typical IS department provides user assistance in hardware and software acquisition and use, data administration, user training and assistance, and web administration. A database administrator focuses on planning, policies and procedures regarding the use of corporate data and information. Web administration is another key area for support staff. For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Careers in Information Systems • Chief Information Officer The role of the chief information officer (CIO) is to employ an IS department’s equipment and personnel to help the organization attain its goals. • LAN administrators Local area network (LAN) administrators set up and manage the network hardware, software and security processes. • Internet Careers: Web operations, Web development, and Web administration • System developers • Technical writing • User interface design • Database administration For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Summary • An organization is a system – has inputs, processing mechanisms, outputs, and feedback • Categories of organizational structure: traditional, project, team, and virtual • Reengineering: radical redesign of business processes, organizational structures, information systems, and values of the organization to achieve a breakthrough in business results • Continuous improvement: constantly seeking ways to improve business processes For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning Summary (continued) • Productivity: a measure of output achieved divided by input required • Primary responsibilities in information systems: operations, systems development, and support • Typical IS titles: Chief Information Officer (CIO), LAN administrators, Internet strategists and administrators, Internet systems developers, Internet programmers, and Internet or Web site operators For use with Principles of Business Information Systems, 4e by Stair, Reynolds & Chesney © 2021 Cengage Learning