MANAGING THE DIGITAL FIRM: CANADA AND BEYOND

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MANAGING THE DIGITAL MANAGING THE DIGITAL FIRM:FIRM:

CANADA AND BEYONDCANADA AND BEYOND

CHAPTER 1

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Why Information Systems?

• Organizations need IS to survive and prosper

• New challenges in the Competitive environment– Emergence of the global economy– Transformation of industrial economies– Transformation of the enterprise– Emergence of the digital firm

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What is an Information System?

• A set of interrelated components that – collect (or retrieve),– process, – store, and – distribute information

• to support decision-making and control in an organization.

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DATA vs. INFORMATION

• Raw facts

• Represent events

• E.g. sales from a cash register

• Organized data

• Meaningful to people

• E.g. sales trends, comparison of brands

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Four activities in an IS

1. INPUT 2.PROCESSING 3.OUTPUT

4. FEEDBACK

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A Business Perspective on IS

Info

Systems

ORGANIZATIONS TECHNOLOGY

MANAGEMENT

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Literacy Components

• Computer Literacy– Knowledge of technical dimensions (IT)

• Information Systems Literacy– Broad understanding of computer-based IS– Encompasses management & organizational

dimensions– Includes technical dimensions (IT)

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Approaches to IS

• Technical Approach– Emphasizes mathematically based models to

study IS

• Behavioural Approach

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Two Approaches to IS

SOCIOLOGYSOCIOLOGY

ECONOMICSECONOMICSPSYCHOLOGYPSYCHOLOGY

COMPUTER COMPUTER

SCIENCESCIENCEOPERATIONS OPERATIONS

RESEARCHRESEARCH

MANAGEMENTMANAGEMENT

SCIENCESCIENCE

TECHNICAL APPROACHESTECHNICAL APPROACHES

MISMIS

BEHAVIOURAL APPROACHESBEHAVIOURAL APPROACHES

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The Preferred Approach to IS

IS performance is optimized when both the organization and the technology adjust to each other, until a good fit is obtained

The Sociotechnical Approach:

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The Impact of the Internet

Communicate & Collaborate

Access Information

Participate in Discussions

Supply Information

Find Entertainment

Exchange Business

Transactions

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Digital Organizational Design

• Flattening organizations

• Separating work from location

• Reorganizing workflows

• Increasing organizational flexibility

• Changing management process

• Redefining organizational boundaries

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Internet-based technologies

• Intranet– An internal network based on Internet

technologies

• Extranet– Private intranet that is accessible to

authorized outsiders

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The Emerging Digital Firm

• Electronic market– A marketplace that is created by computer &

communications technologies, linking buyers and sellers

• E-commerce– buying & selling goods and services electronically

• E-business– Organizational communication, coordination &

management using Internet technologies

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The Emerging Digital Firm

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Key Management Issues

• Strategic Challenge: – How can business use IT to become

competitive, effective and digitally enabled?

• Globalization Challenge• Information Architecture & Infrastructure

Challenge• IS Investment Challenge• Responsibility & Control Challenge

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Positive Impacts of IS

• Perform calculations & process paperwork faster than people

• Help companies learn about their customer’s preferences & purchases

• Provide new efficiencies (e.g. ATMs)• Provide advances in medicine• Internet allows distribution of information widely

and quickly

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Negative Impacts of IS

• May replace people & eliminate jobs

• System outages can cause critical shutdowns

• Heavy users may experience health problems

• Internet can be used to distribute illegal copies of software and violate intellectual property regulations

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Case: SK Wheat Pool

• What were the reasons SK Lab had to change its business processes?

• Why Lotus?

• What mgnt, org, and tech issues did the lab have to address?

• What measures could you use for evaluation of success? Was it successful?

• Is SK Lab a digital organization?

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c h a p t e r

11MANAGING THE DIGITAL MANAGING THE DIGITAL

FIRM:FIRM:

CANADA AND BEYONDCANADA AND BEYOND