Organization, Technology and Information

Aj.Patcharaporn Panwong

E-mail: patcharaporn.panwong@gmail.com

School of IT

7/11/2011

Announcement

Group Work: Announcement

• Group Work might be assigned weekly (flexible)

• Due to many questions & requests, change number of group member

– 10 people : 1 company

– Form group member from different sections (Mixing)

• Deadline for submitting group works

Name Deadline

1 Group Work 1 (Week 1) 20 November 2011, before midnight (e-learning)

2 Final Group Work Report (Mix group works from Week 2 - 14)

6 February 2012 in lecture class

Rule

• Not accept late work = 0 mark, due to many students

• Cheating = 0 mark

• Absence: Will check class attendance for you, IF

– Sick: Send “doctor certificate” plus “sick leave letter”

– Other important cases e.g. visa extension: 1) Inform in advance by mail / in person + 2) Send letter later

For your information,

1. Lecture = for all students who study OAM

2. Lab = 2 sections. Important, you need to remember your lab section for submitting individual work + attending lab hour/lab test + writing down in your exam paper.

Getting started with Chapter 2

Agenda

• Type of Enterprises / Firms

• Organizational Structures

• Information Characteristics in Organization

• The Flow of Information within an Organization

• Information Systems Using in the Organization

• Leverage IT as a competitive strategy

1. Retail Enterprises own a large number of stores in a wide geographical area and use their size to obtain discount on the goods purchase; then seek to sell the goods at the lower price than smaller retailers

Example: 7eleven, Tesco Lotus Express

Type of Enterprises / Firm

7eleven Book Smile (book and web) Shopping Online (http://www.shopat7.com) 7catalog (book and web) Counter Services

2. Manufacturing Enterprises create goods on a large scale and then distribute & sell the goods to customers or other organizations.

Example:

- Digital camera: Fujifilm ( Japan) using ERP system

- Car: Toyota

Type of Enterprises (cont)

3. Service Enterprises typical create or sell goods, but provide service for customers or other organizations.

Example:

- Insurance: Worldcare Travel Insurance, AIA and etc.

- Banking & Financial industries: Citibank, SCB and etc.

- Restaurant: MK

Type of Enterprises (cont)

4. Wholesale Enterprises seek to purchase and sale in large quantities of goods to other organizations, usually at a lower cost than retail.

5. Government Enterprises include large city governments, state governments, and the departments & agencies of the federal department

Type of Enterprises (cont)

6. Education Enterprises include large universities or school systems which consist of executives, instructors, and other service personnel and whose reach extends throughout a country, a state, or the entire country.

Example: MFU, e-learning web-based system

Type of Enterprises (cont)

Organizational Structures

“Organizational subunits and the way they relate to the overall organization.” (Ralph Stair and George Reynolds 2010)

• Directly impact to organization’s information system

• There are four main structures as follows:

1. Traditional Organizational Structure

2. Project Organizational Structures

3. Team Organizational Structures

4. Virtual Organizational Structure and Collaborative Work

Traditional Organizational Structure

• Called a “hierarchical structure”

• As managerial pyramid which decision making and authority flows from top-level managers to non-management employees

Strategic level

Tactical level

Operational level

Clerical level

Decision + authority

Traditional Organizational Structure (Cont)

• Trend: “Flat organizational structure”

• To reduce number of management levels / layers in the traditional organizational structure

• Empowerment of employees & their managers

– By giving more responsibility & authority to make decisions and solve problems without permission from midlevel managers.

• IS a key which provides required information to make decision for employee

Project Organizational Structures

“A structure centered on major products and services” (Ralph Stair and George Reynolds 2010)

• Traditional functions are positioned within each project.

• Many project teams are temporary – finish then members move to new team formed for another project

President

Senior VP, A Project

Finance

Marketing

Production

Sales

Senior VP, B Project

Finance

Marketing

Production

Sales

Team Organizational Structures

“ A structure centered on work teams or groups” (Ralph Stair and George Reynolds 2010)

• Team can be

– small / large

– temporary / permanent.

• Each team has a leader who reports to an upper-level manager

Virtual Organizational Structure and Collaborative Work

“A structure that employs individuals, groups, or complete business units in geographically dispersed areas that can

last for a few weeks or years, often requiring telecommunications or the Internet” (Ralph Stair and

George Reynolds 2010)

• Work can be done anywhere, anytime

• Allow collaborative work

• Use IT to communicate and coordinate work

Virtual Organizational Structure and Collaborative Work

• Successful one: one strategy is to have in-house employees concentrate on the firm’s core business and use virtual employees to do everything else.

Collaborative work

USA

India

Thailand

• People in the organization need different information, due to different responsibilities.

• Data have its own flow called as “Data flow”

Information characteristics in organization

• People must receive only needed information to accomplish their job (no more or less).

Differing information Needs

• Well designed information system filter information such the right information reaches the right decision maker at the right time in the right form.

There are 4 basic levels of knowledge workers in every company as follows:

1. Clerical level

2. Operational level

3. Tactical Level

4. Strategic Level

Differing information Needs (cont)

1. Clerical level: personnel, those involved in repetitive tasks, are concerned primarily with transaction handling.

Example: a sale clerk might key in customer orders on his/her terminal and an airline ticket agent might confirm a flight.

Differing information Needs (cont)

Strategic level

Tactical level

Operational level

Clerical level

Sale clerk

2. Operational level:

• Personnel at the operational level have well-defined short-term tasks.

• Their information requirements often consist of operational feedback.

Differing information Needs (cont)

Strategic level

Tactical level

Operational level

Clerical level

Sale Manager

3. Tactical Level: Manager and knowledge workers concentrate on achieving a series of goals required to meet the objective set at the strategic level.

• The information requirements are usually periodic.

• Tactical level personnel are concerned primary with operation and budgets from year to year.

Example: In the sale of information system, the national sales director, who is at the tactical level, might want the cooperate sale report.

Differing information Needs (cont)

4. Strategic Level: Provide overall direction and guidance of the organization (objective-oriented)

• Their information requirements are often one time reports, what – if reports and trend analyses.

Example: the president of the company might ask for the report that shows the four-year sales trend for each product.

Differing information Needs (cont)

What Information describes

Description

Internal Information Describe special operational aspects of an organization

External Information Describe the environment surrounding the organizations

Objective Information Quantifiably describe something that is known

Subjective Information Attempt to describe something that is currently unknown

The flow of information within an Organization

1. The Vertical flow

1.1. The upward flow

- Based on daily transactions (such as sales)

- People in the lower level: capture the information and store it in the central database

- People in the upper levels: access and use that information

The flow of information within an Organization (cont)

1. The Vertical flow (cont)

1.2. The downward flow

- Consists of the strategies, goals, and directive that originate at one level and are passed to lower levels

Example: An overall sales goal might originate at the strategic management level., which would develop more specific sales goals pass them to the operational management level.

The flow of information within an Organization (cont)

2. The horizontal flow

- Information that passes among various departments

3. The Decentralized Organization (New information flow):

- Computer network era to a decentralized form

- Flat Organization

- Cooperative work by a group of people

- Share use of databases

• Accounting and Finance

• Human Resources (HR)

• Manufacturing

• Quality Control

• Marketing

• Sales

• Distribution

• Customer Services

Information systems in the Enterprise

1. Accounting and Finance

- Accounting software manages everyday transactions, such as sales and payments to suppliers.

- Financial software helps to manage a budget, forecast, and analyze.

Information systems in the Enterprise (cont)

2. Human Resources (HR)

- Human Resources Information System (HRIS) manages one or more human resources functions.

Example: Wal-Mart maintains records on its more than 1.8 million employees.

- Employee Relationship Management (ERM) system automates and manages much of the communication between employees and business such as

- Preparing an overall training plan of company

- Preparing a statement of payments and mailing of salary bulletins

Information systems in the Enterprise (cont)

3. Manufacturing - Assist on the actual assembly process such as scheduling and

managing the product inventory.

- Example: Material Requirement Planning (MRP) focuses on issue related to inventory of parts and forecasting future demand. So those materials are always available when needed.

Information systems in the Enterprise (cont)

4. Quality control

- Quality control systems help the company to maintain or improve the quality of products and services.

- Quality control software needs the data that gathers from the on going process.

- Combining with static analysis software can define or predict the product defects and problems with the company process.

Information systems in the Enterprise (cont)

5. Marketing- A marketing information system serves as central repository for

the tasks of the marketing functional units.

- Example: A market research system stores and analyzes data gathered from demographics and surveys; targeting market by querying database with criteria e.g. income, gender, previous purchase, and favorite recreational activities.

Information systems in the Enterprise (cont)

6. Sales - Help sales people manage customer contacts, scheduling

customer meeting, manage product information, and take orders from customers.

- Example: Sales Force Automation (SFA) system records all the stages in a sales process. (Wikipedia)

Information systems in the Enterprise (cont)

7. Distribution

- Distribution systems provide forecasting for inventory control, manage & track product shipping, and provide information to analysis on inventory in warehouse.

- Some distribution systems need GPS and other navigation technologies to track real-time shipping.

Information systems in the Enterprise (cont)

8. Customer Services

- Customer Interaction Management (CIM) software handles the day to day interactions with customers across different channels e.g. telephone, e-mail, instant message and etc.

- CIM routes customer’s telephone call to the right person depending on the identity or response that customer giving to the prompts.

Information systems in the Enterprise (cont)

IT department as a key resource

• Make technology decisions for the enterprise e.g. decision whether to build or buy new customer interaction management information systems.

• Many companies elevate the importance of IT by including a CIO executive position that reports to CEO.

Competitive strategies

“the strategic advantage one business entity has over its rival entities within its competitive industry” (Wikipedia)

• All information systems in organization must facilitate organization’s competitive strategies.

• Porter’s Generic Competitive Strategies:

• Cost

• Differentiation

• FocusLowest cost

across industry

Better product/service across industry

Lowest cost within an industry segment

Better product/service

within an industry segment

Cost Differentiation

Broad target

Narrow target

• Increasing Sales

• Increasing productivity and reduce cost

• Improving Customer Service

Leverage IT as a competitive strategy

“If information technology is so clearly the solution for establishing the competitive advantage, why isn’t everybody doing it?”

– IT solutions often are expensive and time consuming

– Risk failure

– Resist change

Leverage IT as a competitive strategy (cont)

• Business strategy: service can be delivered over network channels.

• Organization culture: change in the way of information flow (communication)

• Organization structure: enable more flexible structure

• Management process: reduce unnecessary process and provide more ways of accessing information

• Work: change nature of professional work by using IT

• The Workplace: work anywhere + anytime.

The Impact of IT on organizations

Assignment

Individual Assignment

• Will be announced in your lab hour

• Section 01: Tuesday 8.00-10.00 S3 101

• Section 02: Thursday 8.00-10.00 S3 101

Group Work2 (Briefly)

• Remark: Be part of final group work report, submit on 6 February 2012 in lecture class

• As launching a new company from your group work1,

– What is a type of your organizational structure?

– Draw your organizational structure using MS word 2011

– Define job position of each member in your group

• Download “group work assignment & template2” from e-learning

– From workbin: “1301341: Office Automation Management (2/2011)”

– Under folder: “Group work Assignment”

Reference

• Ralph M. Stair and George W. Reynolds. (2010). Information Systems. 9th Edition. Canada : International ISE Edition.

• Stephen Haag. … [et al.]. (2007). Management Information Systems for the Information Age. 6th Edition. Singapore : McGraw-Hill/Irwin, The McGraw-Hill Companies, Inc.

• Vijayagopal. (2011). Communication Flow in the Organization. http://vijagopalk.tripod.com/trainervijayagopal/id19.html

• Wikipedia. (2011). http://en.wikipedia.org/wiki/Main_Page

• Kioskea. (2011). Employee Relationship Management (ERM). http://en.kioskea.net/contents/entreprise/erm.php3

• QuickMBA. (2011). Competitive Advantage. http://www.quickmba.com/strategy/competitive-advantage/

• What is the difference between upward and downward flow of information?. http://www.kaschassociates.com/101web/ex1%20oc%20upward%20downward.htm

• David Skyrme. (2011). The Impact of IT on Organizations. http://www.skyrme.com/insights/5itorg.htm

Questions?