Information Technology and Control BA 152. Evolution of Organizational Applications of Information Technology 1. Operations Transaction processing systems.

Information Technologyand Control

BA 152

Evolution of Organizational Applications of Information Technology

1. Operations• Transaction processing systems• Data warehousing

LOW SYSTEM COMPLEXITY HIGH

Direction of InformationSystemEvolution

MANAGEMENTLEVEL

TOP(strategy, plans,

non-programmed)

LOWER LEVEL

2. Business Resource• Management Information systems• Decision Support Systems• Executive information systems• Management control systems• Balanced Scorecard

3. Strategic Weapon

• Intranets• ERP• Knowledge Management

INTERNAL• Extranets, EDI• IntegratedEnterprise•E-Business

EXTERNAL

Data, Information, & Control Data - Input from any communication

channel Information - Data that alters or reinforces

understanding Control - Evaluation of information that

provides the basis for future actions

Information and DataIn

form

atio

n

DataLow

High

High

Information and Control

Information

Co

ntr

ol

High

Low High

Control Systems:The Key Pieces

PerformanceStandards

PerformanceMeasures

Actions (if necessary)

Major Control Approaches Market Control –

Bureaucratic Control –

Clan Control -

Control Systems:What gets controlled and how?

Output

Process

Input

ClanBureaucracyMarketHow

What

Supervisory Control Strategies

Input Control –

Behavior Control –

Output Control –

Supervisory Control Strategies What works best when?

Are Tasks Structured?YES NO

YES

Are OutcomesMeasurable?

NO

Developing Effective Control Systems

1. Involve employees in the process, as appropriate

2.

3. Keep the system as simple as possible

4.

Developing Effective Control Systems

5. Make sure the system fits with the firm’s culture, strategy, and structure

6.

Effective Control Systems:Keep the following in mind

1. What gets measured is what will get done!

2. System costs must be considered.

3. Too much information can be as bad as too little.

4. You can’t make just one decision.

Control Systems

The Balancing Act

ControlControl AutonomyAutonomy

Knowledge Management

Consider two different types of knowledge important to organizations.– –

Types of Knowledge

Explicit Knowledge– Knowledge that is formal and systematic–

– Knowledge that can be communicated and shared.

– Examples?

Types of Knowledge

Tacit (implicit) Knowledge– Knowledge that is highly personal.–

– – Knowledge that is difficult to

communicate, because “We often know more than we can tell.”

– Examples?

Types of Knowledge

Sharing Different KindsOf Knowledge

Explicit to Tacit and vice-versa

Sharing Knowledge:The knowledge spiral

FROM

Tacit

Explicit

TO ExplicitTacit

Two Approaches to Knowledge Management

For Explicit KnowledgeProvide high-quality, reliable, and fast

information systems for access of codified, reusable knowledge

Two Approaches to Knowledge Management

Mechanisms

Technology

KnowledgeManagement

Strategy

People-to-documentsDevelop an electronic document system that codifies, stores, disseminates, and allows reuse of knowledge.

Invest heavily in information technology, with a goal of connecting people with reusable codified knowledge.

For Tacit KnowledgeChannel individual expertise to provide creative advice

on strategic problems

Two Approaches to Knowledge Management

Two Approaches to Knowledge Management

Person-to-person

Develop networks for linking people so that tacit knowledge can be shared

Invest moderately in information technology, with a goal of facilitating conversations and the exchange of tacit knowledge

Mechanisms

Technology

KnowledgeManagement

Strategy

Communities of Practice

Collections of individuals– Bound together by informal relationships– – Sharing common work context–

Communities of Practice

“Practice” suggests how individuals actually do their jobs as opposed to their formal job descriptions from their firm.

Collective Comparisons

As long as people need to

connectMutual needs

Friends & business contacts

To collect & pass on

information

Informal network

Until project is completed

Milestones and project

goals

Assigned by senior manager

To complete a specific

task

Project team

Until the next reorganization

Job demands and common

goals

Those reporting to

manager

To deliver a product or

service

Formal work group

Community

of practice

How long does it last?

What holds it together?

Who belongs?Purpose?

Why should we allow/encourage, but not attempt to formally manage, COPs?

1. They can help drive strategy.

2.

3. They can solve problems quickly.

4.

5. They develop professional skills.

6.

Communities of Practice

Next Time

Organizational Size, Life Cycles, and Decline