Implementing Business Change With Information Technology
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IMPLEMENTING BUSINESS CHANGE WITH INFORMATION TECHNOLOGY What Is Change? Change is: alterations in people, structure, or technology change is an organizational reality managing change is an integral part of every manager’s job complicates the jobs of managers Forces for Change External Forces External Forces causing change are: marketplace - adapt to changing consumer desires governmental laws and regulations - frequent impetus for change technology - source of change in almost all industries labor markets - HRM activities must change to attract and retain skilled employees in the areas of greatest need economic - uncertainties about interest rates, budget deficits, and currency exchange rates Internal Forces Internal Forces causing change are: originate from the operations of the organization
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Transcript of Implementing Business Change With Information Technology
IMPLEMENTING BUSINESS CHANGE WITH INFORMATION TECHNOLOGY
What Is Change?
Change is: alterations in people, structure, or technology change is an organizational reality managing change is an integral part of every manager’s job
complicates the jobs of managers
Forces for Change
External ForcesExternal Forces causing change are:
marketplace - adapt to changing consumer desires governmental laws and regulations - frequent impetus for change technology - source of change in almost all industries labor markets - HRM activities must change to attract and retain skilled employees in the areas of greatest need economic - uncertainties about interest rates, budget deficits, and currency exchange rates
Internal ForcesInternal Forces causing change are:
originate from the operations of the organization forces may include strategy, workforce, new equipment, or employee
attitudes
The Change Process
Three Categories of Change
Work specialization,departmentalization, chain of command, span ofcontrol, centralization,formalization, job redesign,or actual design
Structure
Attitudes, expectations,perceptions, andbehavior
People
Work processes, methods,and equipmentTechnology
Work specialization,departmentalization, chain of command, span ofcontrol, centralization,formalization, job redesign,or actual design
StructureStructure
Attitudes, expectations,perceptions, andbehavior
PeoplePeople
Work processes, methods,and equipmentTechnologyTechnology
Three main categories of change are:• changing structure - organization’s formal design, centralization,
degree of formalization, and work specialization • structural components and structural design
• changing technology - modifications in the way work is performed• alterations in the methods and equipment used• consequence of competitive factors or innovations within an
industry– automation - replaces tasks done by people with
machines
– computerization - recent visible changes in information systems
changing people - changes in employee attitudes, expectations, perceptions, and behavior
• organizational development (OD) - techniques or programs to change people and the nature and quality of interpersonal work relationships
– intended to help individuals and groups work together more effectively
Managing ChangeChange is managed by: identifying what organizational areas might need to be changed putting the change process in motion managing employee resistance to change Involve as many people as possible in planning and application
development Make constant change an expected part of the culture Tell everyone as much as possible about everything as often as
possible Make liberal use of financial incentives and recognition Work within the company culture, not around it
IMPLEMENTING BUSINESS CHANGE WITH IT:
There are various strategies through which IT helps in implementing business change. Some can be seen by the following diagrams:
ImprovingBusinessProcess
PromoteBusinessInnovation
Locking in Customers and Suppliers
Use IT to reduce costs of doing business
•Use IT to improve quality•Use IT to link business to customers and suppliers
Use IT to create new products or services
EnhanceEfficiency
Create NewBusiness Opportunities
Maintain ValuableCustomers and Relationships
Strategy
IT Role
Outcome
ImprovingBusinessProcess
PromoteBusinessInnovation
Locking in Customers and Suppliers
Use IT to reduce costs of doing business
•Use IT to improve quality•Use IT to link business to customers and suppliers
Use IT to create new products or services
EnhanceEfficiency
Create NewBusiness Opportunities
Maintain ValuableCustomers and Relationships
Strategy
IT Role
Outcome
RaiseBarriersto Entry
Build aStrategic ITPlatform
Build a Strategic Information Base
Increase amount of investment or complexity of IT needed to compete
Use IT to provide information to support firm’s competitive strategy
Leverage investment in IS resources from operat-ional uses to strategic uses
IncreaseMarket Share
Create NewBusiness Opportunities
EnhanceOrganizational Collaboration
Strategy
IT Role
Outcome
RaiseBarriersto Entry
Build aStrategic ITPlatform
Build a Strategic Information Base
Increase amount of investment or complexity of IT needed to compete
Use IT to provide information to support firm’s competitive strategy
Leverage investment in IS resources from operat-ional uses to strategic uses
IncreaseMarket Share
Create NewBusiness Opportunities
EnhanceOrganizational Collaboration
Strategy
IT Role
Outcome
TOOLS AND TECHNIQUES OF IT FOR IMPLEMENTING BUSINESS CHANGE
Business Process Reengineering:
One of the most important competitive strategies today is business process reengineering (BPR) most often simply called reengineering. Reengineering is more than automating business processes to make modest improvements in the efficiency of business operations. Reengineering is a fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, speed, and service. BPR combines a strategy of promoting business innovation with a strategy of making major improvements to business processes so that a company can become a much stronger and more successful competitor in the marketplace. However, while many companies have reported impressive gains, many others have failed to achieve the major improvements they sought through reengineering projects.
Business Quality Improvement:
Business quality improvement is a less dramatic approach to enhancing business success. One important strategic thrust in this area is called Total Quality Management (TQM). TQM emphasizes quality improvement that focuses on the customer requirements and expectations of products and services. This may involve many features and attributes, such as performance, reliability, durability, responsiveness etc.
TQM uses a variety of tools and methods to provide:
• More appealing, less-variable quality of products or services• Quicker less-variable turnaround from design to production and
distribution• Greater flexibility in adjusting to customer buying habits and
preferences• Lower costs through rework reductions, and non-value-adding waste
elimination.
Business QualityImprovement
Business QualityImprovement
BusinessReengineering
BusinessReengineering
DefinitionDefinition
TargetTarget
PotentialPaybackPotentialPayback
RiskRisk
What Changes?What Changes?
PrimaryEnablersPrimaryEnablers
Incrementally Improving Existing ProcessesIncrementally Improving Existing Processes
Radically Redesigning Business SystemsRadically Redesigning Business Systems
Any ProcessAny Process Strategic Business ProcessesStrategic Business Processes
10%-50% Improvements10%-50% Improvements 10-Fold Improvements10-Fold Improvements
LowLow HighHigh
Same Jobs - More EfficientSame Jobs - More Efficient Big Job Cuts; New Jobs; Major Job RedesignBig Job Cuts; New Jobs; Major Job Redesign
IT and Work SimplificationIT and Work Simplification IT and Organizational RedesignIT and Organizational Redesign
Business QualityImprovement
Business QualityImprovement
BusinessReengineering
BusinessReengineering
DefinitionDefinition
TargetTarget
PotentialPaybackPotentialPayback
RiskRisk
What Changes?What Changes?
PrimaryEnablersPrimaryEnablers
Incrementally Improving Existing ProcessesIncrementally Improving Existing Processes
Radically Redesigning Business SystemsRadically Redesigning Business Systems
Any ProcessAny Process Strategic Business ProcessesStrategic Business Processes
10%-50% Improvements10%-50% Improvements 10-Fold Improvements10-Fold Improvements
LowLow HighHigh
Same Jobs - More EfficientSame Jobs - More Efficient Big Job Cuts; New Jobs; Major Job RedesignBig Job Cuts; New Jobs; Major Job Redesign
IT and Work SimplificationIT and Work Simplification IT and Organizational RedesignIT and Organizational Redesign
Telecommunications Networks:
Most popular telecommunications networks are WAN, LAN, MAN, VPN and Internet. Telecommunications networks are greatly used by businesses due to their following strategic capabilities:
Overcome Geographic Barriers: Capture information about business transactions from remote locations.Overcome Geographic Barriers: Capture information about business transactions from remote locations.
Overcome Time Barriers: Provide information to remote locationsimmediately after it is requested.Overcome Time Barriers: Provide information to remote locationsimmediately after it is requested.
Overcome Cost Barriers: Reduce the cost of more traditional means of communications.Overcome Cost Barriers: Reduce the cost of more traditional means of communications.
Overcome Structural Barriers: Support linkages for competitive advantage.Overcome Structural Barriers: Support linkages for competitive advantage.
Overcome Geographic Barriers: Capture information about business transactions from remote locations.Overcome Geographic Barriers: Capture information about business transactions from remote locations.
Overcome Time Barriers: Provide information to remote locationsimmediately after it is requested.Overcome Time Barriers: Provide information to remote locationsimmediately after it is requested.
Overcome Cost Barriers: Reduce the cost of more traditional means of communications.Overcome Cost Barriers: Reduce the cost of more traditional means of communications.
Overcome Structural Barriers: Support linkages for competitive advantage.Overcome Structural Barriers: Support linkages for competitive advantage.
Information Systems:
An Information System is an organized combination of people, hardware, software, communications networks, and data resources that collects, transforms, and disseminates information in an organization. Key concepts of the text include:Information Technology (IT) . The dynamic interaction of computer-based information systems with telecommunications forms the backbone of IT.End User Perspective. An end user is anyone who uses an information system or the information it produces. As a perspective on management information systems, the end user focuses designers, developers, and all information systems personnel on how the system does and should function in use. Information systems are powerful tools -- and all the more powerful when made to fit the needs of those who use them everyday. This involves adapting the system to the user, not the other way around. An Enterprise Perspective. Information technology can provide the information a business needs for efficient operations. It can even be the foundation of a company's competitive advantage. But to function properly, an information system must be developed in support of the strategic objectives, business operations, and management needs of the enterprise.
Input ofData
Resources
Input ofData
Resources
Processing Data
Processing Data
Output ofInformation
Products
Output ofInformation
Products
Control of System PerformanceControl of System Performance
Storage of Data ResourcesStorage of Data Resources
Input ofData
Resources
Input ofData
Resources
Processing Data
Processing Data
Output ofInformation
Products
Output ofInformation
Products
Control of System PerformanceControl of System Performance
Storage of Data ResourcesStorage of Data Resources
