FOUNDATIONS OF INFORMATION SYSTEMS

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BIS 1202

Introduction to Organisations and Information Systems

• Organisations

• The organisation and its environment

• Why do organisations exist?

• Organisation vision, mission, goals, objectives

• Organisational structure

• Organisation culture

• Types of IS in an organisation

Overview

“A social arrangement for achieving controlled performance in pursuit of collective goals.”

(Huczynski & Buchanan, 2001)

Organisations

Organisational Behaviour“The study of the structure, functioning

and performance of organizations and the behavior of groups and individuals within

them.”

(Huczynski & Buchanan, 2001)

Organisations

Organisation

Customers Suppliers Competitors Investors Regulators

Technology Knowledge

IS(Laudon and Laudon, 2006:78)

The Organisation & its Environment

• Organizations exist because they offer many advantages over people acting alone. Synergy (1+1=3), division of labour, formal systems of responsibility

• Organizations exist to serve a purpose or achieve a goal which is difficult to achieve by individuals alone

Why do Organisations Exist?

• The purpose of an organisation is expressed through its mission statement, goals and objectives

• The key to organisational effectiveness lies in its systems of responsibility and authority

• The purpose of existence of an organisation, its values and aspirations are usually expressed through its mission statement. In order to be successful, the organisational structure, culture, behaviour, and design should complement the mission of that organisation

Vision, Mission, Goals, Objectives

Organisation

Vision

Mission Statement

Goals and Objectives

An aspirational view

A general expression of the overall purpose

Example:

“To become the most successful worldwide telecommunications group”

(Campbell and Craig, 2005:29)

Vision

Mission statement may contain: • Some indication of the industry• The market position aiming towards• Values and beliefs• Context-dependent objectives

Mission

Example:“To provide world class telecommunications and

information products and services,

To develop and exploit our networks at home and overseas, so that we can:

• meet the requirements of our customers,

• sustain growth in the earnings of the group on behalf of our stakeholders,

• make a fitting contribution to the community in which we conduct our business”

Mission

(Campbell and Craig, 2005:29)

• Broad-based intentions derived from the mission

• Provides a sense of direction in achieving the vision

• Usually expressed in qualitative terms and tend to be medium to long term in character

Goals

• Provides a focus for managers

• Aspirational targets; more recognisable; achievable

• Usually expressed in quantitative terms

Objectives

S

M

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Specific

Measurable

Achievable

Realistic

Time related

Explicit statement of required outcome

Means of assessing results against plan

Within the capabilities of people and resources employed

Practical and sensible assessment of capabilities

Where relevant completion dates

Objectives

When setting objectives:

Refers to organisational sub-units and the way they are related to the overall organisation

Organisational Structure

Objective of the organisational structure

Means of attaining objectives and goals

The extent to which, and the ways in which, one is controlled and constrained

Organisational Structure

• Traditional or hierarchical structure

• Project organisational structure

• Team organisational structure

• Multidimensional organisational structure

Organisational Structure

Chief executive

Senior executive

Department/division heads

Superintendents

General foremen

First-line supervisors

Top management

Middle management

Supervisory management

(Buchanan & Huczynski, 1997)

Organisational Structure

Multinational companies Operate in several countries (e.g., Coca-Cola, IBM)

International organisations Do business with other companies in different countries

(e.g., Boeing) Virtual global companies

Joint ventures whose business partners are located in different countries

(e.g., Turnstone) (Turban et al., 336) Enterprise

New Business Models

“An organization with partially overlapping objectives working together for some period of time in order to attain their objectives. The actors utilize technology, competence, information and other resources in order to transform input to products that satisfy the needs of customers.”

(Christensen et al., 1995:1172)

What is meant by the term ‘Culture’?

“A set of major understandings and assumptions shared by a group.”

Organisation Culture

• These understandings (e.g., common beliefs, values, and approaches to decision making) are often not documented in goal statements or policies

Organisation Culture

What’s a ‘System’?A group of interrelated components working together toward a common goal by accepting inputs and producing outputs in an organised transformation process’

(James o’Brien, 2004)

Systems Theory

Organisation

Production process

Input from the environment

Output to the environment

Feedback

(Laudon and Laudon, 2006:73)

Systems Theory

Organisational processes (sub systems)

Control

Inputs Outputs

Feedback

• Finance

• Revenue

• Human resources

• Physical resources

• Data, information

• New product development

• Manufacture

• Distribution

• Sales and marketing

• Physical products

• Services

• Profits

• Data, information

• Change plans

• Change resources

• Performance targets

• Performance metrics

Environment

(Chaffey and Wood, 2005:27)

The Organisational System

The Community, Competitors Customers, Suppliers Stockholders Labour unions Financial Institutions Government agencies, etc.

What’s ‘information’?“individuals actively create the meaning of

information through their thoughts, actions and feelings” (Wei Choo, 2000)

Information Age information society

Use of Information Technology (IT)

Transformation of work

Rethinking of business practices

Information

What is ‘Information Technology (IT)’?

Information Technology (IT)

“Any computer-based tool that people use to work with information and support the information and information-processing needs of an organisation.”

(Haag et al., 2004)Technologies that help you to perform specific information-processing tasks

Hardware Software

“Information systems are the means by which organisations and people, using information technologies gather, process, store, use, and disseminate information.”

(www.ukais.org)

Information Systems (IS)

What are ‘Information Systems’?

“A Business IS (BIS) … converts data into information products that can be used to support forecasting, planning, control, co-ordination, decision making and operational activities in an organisation.”

(Bocij et al.)

Business Information Systems (IS)

What is a ‘Business Information Systems (BIS)’?

Data

Information Systems

Hardware

Software

People

Telecommunications

(Jessup and Valacich, p1-7)

Procedures

Computer Based Information Systems (CBIS)

Input of data resources

Processing data into information

Output of information products

Storage of data resources

Control of system performance

People Resources

End users and IS specialist

s Software Resources

programs and procedures

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Network Resources Communications media and Network support

Data R

esources

data and Know

ledge bases

(O’Brien, 2004, page 11)

Components of an IS

People Resources

• IS Specialists

People who develop and operate IS. (e.g. system analysts, software developers, system operators)

• End Users Anyone who uses the information systems or the information it produces (e.g. customers,

salespersons, managers) (O’Brien, 6th Edition, page 12)

Components of an IS

Software Resources

All sets of information processing instructions• Programs

System software (e.g. operating system programs),

Application software (e.g. spreadsheet programs, word processing programs, payroll

programs, etc.)

• Procedures:data entry procedures, error correction procedures, paycheque distribution procedures, etc.

Components of an IS

(O’Brien, 6th Edition, page 12)

Hardware Resources

All physical devices and materials used in information processing

• Machines :Computers, video monitors, magnetic disk drives, printers, optical scanners, etc.

• Data Media: flash disks, magnetic tapes, optical disks, plastic cards,paper forms, etc.

Components of an IS

(O’Brien, 6th Edition, page 12)

Network Resources

Communications media

Communications processes

Network access and control software, etc.

Components of an IS

(O’Brien, 6th Edition, page 12)

Data vs. Information– Data: Facts about an event or a transaction. More formerly

you can say that data are objective measurements of the attributes (the characteristics) of entities (such as people, places, things, and events) (O’Brien, p13). Example: a sales transaction (we can collect the item descriptions and the number of each item bought, customer card details, etc. )

– Information: Produced by processing data or more simply by converting or putting data into meaningful and useful context for specific users. Example: from the data collected at the POS, we can produce information about how much of an item has moved that day, what are the products which are moving fast, how many times a week a particular customer is visiting the store, how much a particular customer spends on average per month, etc.

(Turban et al, Chapter 1 Page 18)

Clarification of Important Terms

INPUTS

Business problems Business opportunities Data Information Instructions

PROCESSING

Programs People Equipment Storage

OUTPUTS

Solutions Reports Graphics Calculations Recommendations Forecasts Analysis Tactics

CONTROL

Decision makers Auto-control

Feedback

A schematic view of an information system (Turban et al., 2006:20)

The Functions of Information Technology (IT)

Capture

Process

Generate

Store/Retrieve

Transmit

(James A. Senn, 23)

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Organisation

Different ways in which information can create value for organisations

Add value

Reduce cost

Create new reality

Manage risks

Customers and markets

Transactions and processes

Market, financial,

legal, operational

New products, new services, new

business ideas

INFORMATION SYSTEMS IN AN INFORMATION SYSTEMS IN AN ORGANISATIONORGANISATION

BIS1202