Management information system ralp 7e ch02

• The use of information systems to add value to the
organization is strongly influenced by organizational
structure, culture, and change

• Identify the value-added processes in the supply chain
and describe the role of information systems within them
• Provide a clear definition of the terms organizational
structure, culture, and change and discuss how they affect
the implementation of information systems
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• Because information systems are so important, businesses
need to be sure that improvements or completely new systems
help lower costs, increase profits, improve service, or achieve
a competitive advantage

• Identify some of the strategies employed to lower costs or improve
service
• Define the term competitive advantage and discuss how
organizations are using information systems to gain such
an advantage
• Discuss how organizations justify the need for information systems
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• Information systems personnel are the key to unlocking
the potential of any new or modified system

• Define the types of roles, functions, and careers available
in information systems

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Organizations and Information Systems
• Organization: a formal collection of people and other
resources established to accomplish a set of goals
• An organization is a system
• Inputs to the system: resources such as materials, people,
and money
• Outputs to the environment: goods or services

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Figure 2.1: A General Model of an
Organization

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Organizations and Information Systems
(continued)
• Value chain: a series (chain) of activities that includes
inbound logistics, warehouse and storage, production,
finished product storage, outbound logistics, marketing
and sales, and customer service
• Upstream management: management of raw materials,
inbound logistics, and warehouse and storage facilities
• Downstream management: management of finished
product storage, outbound logistics, marketing and sales,
and customer service

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Figure 2.2: The Value Chain of a
Manufacturing Company

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Organizational Structure
• Organizational structure: organizational subunits and
their relationship with the overall organization

• Categories of organizational structure:
• Traditional
• Project
• Team
• Multidimensional
• Virtual

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Traditional Organizational Structure
• A hierarchical structure
• Major department heads report to a president or top-level
manager
• A managerial pyramid shows the hierarchy of decision
making and authority

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Figure 2.3: A simplified organizational
model, showing the managerial pyramid

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Figure 2.4: A Traditional Organizational
Structure

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Project Organizational Structure
• Centered around major products or services
• Temporary project teams

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Figure 2.5: A Project Organizational
Structure

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Team Organizational Structure
• Centered on work teams or groups
• Temporary or permanent teams

• Various sizes

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Multidimensional Organizational
Structure
• May incorporate several structures at the same time
• Advantage: ability to simultaneously stress both
traditional corporate areas and important product lines
• Disadvantage: multiple lines of authority

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Figure 2.6: A Multidimensional
Organizational Structure

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Virtual Organizational Structure and
Collaborative Work
• Employs individuals, groups, or business units in

geographically dispersed areas
• People may never meet face to face
• Can be permanent or temporary
• Collaborative work: managers and employees can
effectively work in groups around the world

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Organizational Culture and Change
• Organizational culture: Major understandings and
assumptions for a business, corporation, or organization
• Organizational culture can significantly influence
information systems
• Organizational change: deals with how organizations
plan for, implement, and handle change

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Reengineering
• Process redesign
• Radical redesign of business processes, organizational
structures, information systems, and values of the
organization to achieve a breakthrough in business results

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Figure 2.8: Reengineering

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Continuous Improvement
• Constantly seeking ways to improve business processes
• Benefits:
• Increased customer loyalty
• Reduced customer dissatisfaction
• Reduced opportunity for competitive inroads

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Table 2.2: Comparing Business
Process Reengineering and
Continuous Improvement

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Technology Diffusion, Infusion, and
Acceptance
• Technology diffusion: measure of how widespread the
use of technology is in an organization
• Technology infusion: extent to which technology
permeates a department
• Technology Acceptance Model (TAM): specifies factors
that can lead to higher usage of technology in an
organization

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Total Quality Management
• Quality: ability of a product or service to meet or exceed
customer expectations
• Total quality management (TQM): approaches, tools,
and techniques that foster a commitment to quality
throughout the organization

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