Transcript Four Levels of Organizational Hierarchy

Four Levels of Organizational
Hierarchy
• Operational Level
– TPS: order tracking, payroll, sales, marketing
• Knowledge Level
– CAD/CAM, Lotus Notes, spreadsheet/financial planning, OA
• Management Level
– decision support/mis: budgeting, cost analysis, production
mix/scheduling,
• Strategic Level:
– ESS: forecasting, profit planning, manpower planning
Major types of information
systems
• TPS:
• OA:
• KWS:
• DSS:
• MIS:
• ESS:
lower level work (order entry)
document management
(WP/storage)
design and analysis
cost analysis, pricing analysis
inventory control, capital
budgeting
strategic planning, profit planning
TPS: Types
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Sales/marketing systems
Manufacturing/production systems
Human resources systems
Industry specialized (vertical markets)
Knowledge Work Systems & OA
Systems
• KWS: Engineers, data analysts (Wall Street
“rocket scientists”), scientists
– Example: MRIs and CAT scans, biomedical
• OAS: knowledge workers, managers
– Word processing/desktop
publishing/presentation programs,
– document imaging/management
MIS
• MIS: supports management level by
providing routine summary reports and
exception reports:
– Example: Which students were here in the Fall
who did not choose to return in the Spring?
DSS
• DSS provides material for analysis for the
solution of semi-structured problems,
unique or rapidly changing problems
– provides the ability to do “what if” analysis
• DSS uses the data from MIS but is:
– more a “right now” analysis than a long-term
structure like MIS
MIS vs. TPS
• MIS differs from TPS in that MIS deals
with summarized and compressed data from
the TPS.
• TPS (data) to MIS (information)
DSS vs. ESS
• DSS: provides material for analysis for:
– semi-structured problems, unique or rapidly
changing problems
– Ability to do “what if” analysis
• ESS: supports senior managers with
unstructured decision-making.
– Less analytical than DSS with less use of
models (linear or forecasting)
Strategic Information System vs. StrategicLevel System
• Strategic information system:
– Changes the goals, operations, products, services,
environmental relationships of organizations
– Changes the very nature of the firm’s business
• Strategic-level system:
– Provide long-term planning information to senior
executives
– Not as far reaching and deeply rooted
– Does not transform the organization itself
(fundamentally)
Value chain vs. competitive
forces Models
• Both models complement each other
• Both models are used to aid firms in
identifying where information systems can
provide a competitive advantage
– Competitive force model examines external
environment to identify threats/opportunities
– Value chain model highlights specific activities
within firm to identify where competitive
strategies can be best applied.
Four Basic Competitive Strategies
• Product differentiation:
– Unique products/services
– Distinct from competititor
• Focused differentiation:
– “Mine” information to focus on previously unexploited market
niche
– The new, under 14 millionaires (bacon holder)
• Tight linkages to customers/suppliers:
– Lock in customers and suppliers
– facilitate purchasing/raise switching costs
• Low-cost producer:
– produce goods and services at a lower price or with greater
efficiency than competitors
Strategic Systems???
• Strategic systems are difficult to build:
– Entail massive sociotechnical changes within the
organization
– Organizational boundaries between firm and customer
and suppliers and departments must be broken down
– New relationships among parts of the company and
customers and suppliers must be redefined.
• An entirely new organizational structure (Saturn & GM
• Resistance to change impacts responsibilities and jobs
Information Partnerships: Do
they work?
• Retailers cooperate with airlines to award
frequent flier miles
• Each gains access to customers of the others
and information on good customers
• Does this relationship benefit the customer?
Universal Characteristics of
organizations
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Clear division of labor
Hierarchy
Explicit rules and procedures
Impartial judgments
Technical Qualifications for positions
Maximum organizational efficiency
Organizational Differences
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Organizational type
Environment
Goals
Power
Constituencies
Function
Leadership
Tasks
Technology
Environmental and Institutional
Model of Information Systems
• Environmental: (Constraints and Opptys)
– Rising cost of labor, competitive action of other
organizations, changes in govt regulations
– New technologies, new sources of capital,
demise of competitor, new govt program
• Institutional:
– Values, norms, vital strategic interests
The modern manager in an IS
environment
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Highly fragmented activities
Changing activities rapidly
Spending time pursuing personal goals
Shying away from sweeping policy
decisions
IS Management Support:
Strengths and Weaknesses
• Strengths:
– Nerve center (email, information)
– disseminator
– spokesman
– resource allocator
• Weaknesses:
– figurehead
– leader
– disturbance handler
– negotiator roles
Structured vs. Unstructured
Decisions
• Unstructured:
– Nonroutine decisions in which decision maker must
provide judgment and evaluations for which there is no
standard procedure for doing so.
• Example: a decision to invest in a country of an untested
product history
• Structured:
– Repetitive and routine with standard operating solutions.
Example: product mix, plant scheduling
Four Stages of Decision Making
by Simon
• Intelligence: data and information
gathering
• Design: Alternatives are established
• Choice: Make the choice among the
alternatives
• Implementation: Put decision into effect
Organizational Choice Models
Rational Model
Bureaucratic Model
Political Model
Garbage Can Model
Assumes that human and
organizational behavior is based
in value-maximizing calculation
with certain constraints
The most important goal is the
preservation of the organization,
with reduction of uncertainty a
major goal
What occurs in the organization
is the result of power relations
and political bargains interest
groups
Assumes that organizations are
not rational and decisions are
accidental
Assignments
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Proctor and Gamble
Greyhound
Group Quiz
To be Announced (info processing)