Managing Information & Systems

The Business Perspective

Adrienne Curry, Peter Flett, Ivan Hollingsworth

• Editore: Routledge
• Anno: 2006
• ISBN:
  9781134252800
• Edizione: 1
• Argomento: Business
• Categoria: Business generale

Focusing on the integrated understanding of the role of systems within the business, organizationally and strategically, this book demonstrates theory by including extensive business examples, and by ending each chapter with international case studies. Topics covered include:

• the nature of organizations
• management roles and functions
• information as a resource
• systems approaches
• different information systems and what they can achieve
• structural and cultural fit and information systems
• change management and information systems
• strategic business and information systems management.

Combining readability with theoretical concepts, this book is suitable for both advanced undergraduate and MBA/Masters students.

Chapter 1

Introduction

Introduction

Business and the environment in which it is conducted have changed dramatically over time and will continue to evolve. These changes have engendered new pressures and challenges for the management of information, information systems and information technology, from which a variety of benefits are potentially to be realised. Trends in business have dictated new roles for information and information systems, creating opportunities but also complexities. As we are now in the ‘information age’ it is important to understand what that means and what has shaped the processes that exist today. Data and information (there is a difference that we will define later) and the Information Systems that manipulate them are in essence a tool; a powerful and complex tool but nonetheless they are in place primarily to enhance business and organisational effectiveness. Prior to examining how effective Information Systems can be we must first outline the environments in which they are used.

The Nature of Modern Business

The world of business is dynamic and forever changing to meet new challenges and opportunities. This is nothing new. Since the Industrial Revolution over 200 years ago business organisations have had to change with circumstances. The main difference between then and now is that the speed of such change is now significantly quicker. Even in the last 50 years there have been major changes in the business environment. More recently the advent of the Internet and mobile phones has created a number of opportunities and challenges. Typically these technologies have been grouped under the generic term of Information Communication Technologies (ICT) which encompasses the increasingly convergent areas of information technology and telephone communications. While there is a lot of hyperbole associated with areas of ICT it does engender change, which in itself has to be managed to create positive outcomes for organisational effectiveness.

Trends in Modern Business

Increasing Levels of Competition

One change has been in the level of competition faced by organisations today. This has resulted from increases in population, levels of automation and demand for products and services by an increasingly affluent society. This has made it possible for more and more organisations to seek opportunities to compete for greater market share.

Improvements in transport have also made it possible for organisations to compete beyond their local area. Indeed many organisations not only compete nationally but also internationally, pitting their skills against organisations from other countries, or even other continents.

The role of technology in levelling the playing field in terms of competitiveness is apparent in a number of areas.

The Internationalisation of Business

Business in general has become increasingly international in nature, with organisations competing in an international marketplace. Of course this means that, as well as competing in overseas markets, organisations have to cope with overseas competitors entering their own domestic markets. Organisations not only compete in overseas markets, they also source materials and labour from outside their own countries. Interfaces between nations are expanding, with trade, capital and goods flowing from one country into another with fewer restrictions. This situation has been aided by the increase in international trade groupings such as the European Union (EU) and North American Free Trade Agreement (NAFTA), and by the disparity between costs of material and especially labour in different countries.

The advent of globalisation has given organisations the opportunity to exploit such economic differentials between nations. For example, the garment and clothing industry moving operations to the Far East to take advantage of cheaper labour in what is still a labour-intensive industry. This trend is not limited to traditional products such as clothing. A number of Western European software companies have sub-contracted programming work to the Indian sub-continent. Similarly, more recently, the mobile communications and technologies industry has relocated its call centres to the Indian sub-continent.

Increasing Cooperation

Despite the increased levels of competition, modern business organisations also cooperate more closely than in the past. This is sometimes to take advantage of economies of scale, or to avoid duplication of resources. For example, banks have cooperated to provide customer services, such as national and international automated-teller networks, which would be prohibitively expensive for banks to provide individually.

However, much of today’s cooperation has resulted from the increasing diversity of business. Many organisations are now very specialised and rely on cooperation with organisations specialising in other related fields in order to function as a business. For example, many manufacturing organisations do not own their own means of delivering their product. Instead, they rely on specialist haulage or distribution firms to handle this for them. They may also rely on a variety of consultants to advise on or manage specialist functions such as advertising, recruitment and even product design. In the public sector quality initiatives like the Best Value agenda have promoted cooperation with the private sector and the voluntary sector to strive for more effective delivery of services. Public Private Partnerships (previously known as PFI– Public Finance Initiatives) have been employed to undertake high cost, high value construction projects, such as the Skye Bridge and the new Edinburgh Royal Infirmary. The denationalisation of the rail infrastructure in the UK has seen the wholesale transfer of rail networks and train companies to the private sector with mixed results.

The need to cut costs and rationalise on labour in addition to the joining of symbiotic businesses has led to increasing numbers of organisational mergers from large-scale international oil companies like BP and Amoco to charitable institutions. In the UK two charitable institutions, The Cancer Research Campaign and Imperial Cancer Research Fund, merged to form Cancer Research UK in 2002. The merger was driven by scientists who believed that the pooling of funds would increase the chance of finding a cure for cancer (Hill, 2001).

A Turbulent Environment

There is also an increasing trend towards customer/consumer orientation, the need to fulfil ever-spiralling expectations in terms of rapid response and value for money. In the face of rapid changes, organisations must defend themselves against threats and take maximum early advantage of innovative opportunities. On the one hand is the need to cope with deregulation, increased flexibility and greater opportunity for diversification (e.g. financial services), on the other stands increasing regulation in terms of legislation and statutory requirements (e.g. EU Directives, Environmental Protection Act), security for consumers and bureaucracy. Business and organisations have to cope with continuous change.

Changes in Organisational Structures

As the quantity and speed of information availability to managers increases, so the flow of information must become increasingly selective. The ability to collect, collate, filter and disseminate information is crucial, yet making sure it is relevant is even more important. Information overload can negate the effectiveness of communications applications such as email.

The rate at which information moves and decisions are made is speeding up, partly as a result of the need for a greater degree of responsiveness and partly because of increased flexibility in the way work is carried out. The last two decades have seen new structures emerging, often flatter and more decentralised, in response to greater devolution of responsibility or empowerment. With flatter structures come more pressure and the imperative to harness any technology available to ease this load.

The Way Work is Done

Production tasks have been increasingly automated and processes can be more accurately controlled. The advent of enterprise resource planning systems that support global enterprises has led to higher quality goods and services at lower cost.

Work can be coordinated by means of networking and communication systems that effectively eliminate time and distance restrictions. Teamwork is more widespread with organisational data, information and skills being more extensively shared and exchanged. Boundaries of organisations are becoming less clearly defined as to where work is done, when and by whom. Networks have enabled information to be available at any time, anywhere and lead times in supply and delivery to be significantly eroded.

As a result of automation, more information is yielded as a by-product. Often, new skills and new ways of thinking need to accompany the use of new information tools. Furthermore, a primary source of basic information may yield secondary information (e.g. sales figures revealing buying patterns and trend information on customer preferences, patient morbidity dependant on demographics and socioeconomic group).

The Changing Role of Information

It is somewhat more difficult to quantify information as a resource, as opposed to other business resources such as money, machinery, time and people. Information is intangible and its value is subjective, yet it is essential to the successful running of organisations. In particular the move away from reactive recording to proactive planning to create enhanced products and services, which can be used to create a strategic advantage. The efficient and effective collection, storage, processing and communication of information all present important windows of opportunity. To achieve this managers need to be more efficiently and effectively informed to make the right kinds of decision to take their organisations forward.

As the business environment and the ways organisations operate constantly evolve, there is a consequent increase in information needs. At an executive level there is a constant need for real-time management information from both internal and external sources. Senior management has to be able to respond rapidly to tactical needs of the organisation and be in an informed position to undertake strategic planning, which is vital to future corporate success. Careful screening and reduction of information to senior management is essential to avoid information overload, which is a contributor to clouded and inadequate decision-making. The role of the ‘executive summary’ is as crucial as ever!

With the increasingly important role of information as a corporate resource, comes the need to maintain the security and integrity of information. Significant losses of information or information-processing capabilities can seriously damage the competitive or financial position of an organisation.

There is evidence to suggest that improved information centralises power and decision-making in the organisational hierarchy, thereby reducing considerably the discretion of middle managers needing to conform to standardised procedures. Furthermore, centralisation tends also to catalyse the merging of departments and bring about a simplification of the organisational structure.

Conversely, increasing information availability and communication can produce decentralised management decision-making. Devolved decision-making can be easily monitored by senior management, but organisations can also become more differentiated and therefore complex from a structural viewpoint.

Increased access to and availability of information by means of automation do not necessarily alter the distribution of organisational authority and control. CBIS (Computer-Based Information Systems) tend to reinforce organisational structures in existence, though centralisation is often more the resulting trend than decentralisation. Variables worthy of consideration include organisational size, type of industry, extent of task routinisation, organisational culture, the extent to which staff behave independently as professionals and the patterns of information usage and information flow.

The changing role of information affects social relationships within organisations and relationships between organisations and their external environment, particularly with the public at large who may well find themselves interacting more and more directly with information and information systems than through human intermediaries (e.g. automated teller machines in banks, automated check-in systems in airports, online educational material).

Information as a Product

Information is now seen more as a product in its own right and companies compete on the basis of the quality of the information product that they offer. Marketing efforts have to go beyond merely offering ‘junk mail’ promotions in an ad hoc way. Information customers receive needs to be much more tailored to their individual needs. The filtering of appropriate information will elicit a more positive response, whether this information is electronic or in paper form. The gathering of data through a myriad of different channels, e.g. bank cards, store loyalty cards, bills, viewing habits, etc., all contribute to the formulation of strategies that aim to enhance competitiveness in the business environment. The role of Customer Relationship Management (CRM) can now be exploited as technology has made it possible to apply customisation to large mass markets. While the promise of the Internet has not been without a number of false dawns, the establishment of organisational websites is, of course, an ever-increasing example of information as a product and as a competitive weapon.

The Changing Role of Information Systems in Organisations

Changes in Information Technology

One of the major factors (if not the major factor) for the increasing importance of information is the advances in technology available to process information quickly and effectively. The three strands of information technology – office equipment, computers and telecommunications – have all seen significant progress over the last 30–40 years. Not only have they progressed, but they have also converged; mobile phones with integrated cameras and personal organisers, intelligent fridges, dishwashers, the list is continually expanding. Whether this provides more effectiveness to the users is often debatable and the realisation of the effectiveness of technological innovation can take a considerable time to come to fruition. Typewriters and dedicated electronic word processors have been replaced by personal computers, while public and private telecommunications networks are increasingly based on digital technology. The digital revolution is actually starting to change markets, affect people’s behaviour, work, social and cultural practices, and influence the way in which we live our lives.

The first practical computers were developed during the Second World War in the UK, America and Germany. Intended for military use, these computers were mainly used for ballistics calculations. Not long after this, in 1951, J. Lyons & Company in the UK implemented the first commercial application of computers. Since those early days computer technology has improved by leaps and bounds.

Since the advent of the modern computer there have been four consistent trends:

1. 1 a reduction in the purchase price of computer systems, bringing them within the buying power of smaller organisations and in...

Indice dei contenuti

• Cover
• Half Title
• Title Page
• Copyright
• Dedication
• Contents
• List of illustrations
• List of abbreviations
• 1. Introduction
• 2. Introducing organisations and information
• 3. Management, information and decision-making
• 4. The systems approach to organisational problem-solving
• 5. Information systems and their uses
• 6. Information systems and organisational ‘fit’
• 7. Information systems and organisational change
• 8. Information systems and business strategy
• 9. Overview case study EUROSELECT
• Index