day 3 information technology

Professor Duane Truex III

Day 3

Information Technology:The Design of Organizations and

The Design of Work

Professor Truex Course name

The Information Systems StrategyTriangle

Business Strategy

OrganizationalDesign Strategy

InformationStrategy

What is the impact of the redesign onwork and organizational stakeholders?

How may organizations be redesigned?


• Review traditional organizational designs• Understand how IS allows organizational design

change• Consider some alternative structures

• Examine the impact of IS work and on the way workis done– Explore:

• the changing nature or work,• IT’s impact on different types of workers and• the rise of new work environments.

Today’s Learning Objectives


Organizational Design VariablesWhat factors govern organizational design?

• Business processes: the set of ordered tasks neededto complete key objectives of the business

• Formal reporting relationships: the structure set up toensure coordination among all units within theorganization.• Informal networks: mechanism, such as ad hocgroups, which work to coordinate and transfer informationoutside formal reporting relationships.

• Decision rights: authority to initiate, approve, implementand control various types of decisions necessary to planand run the business.


Organizational DesignControl and Cultural Variables

• Planning: the processes by which future direction isestablished, communicated and implemented.

• Performance measurement and evaluation: the setof measures that are used to assess success in theexecution of plans and the processes by which suchmeasures are used to improve the quality of work.

• Incentives: the monetary and non-monetary devicesused to motivate behavior within an organization

• Values: the set of implicit and explicit beliefs that underliedecisions made and actions taken.

• Data: the information collected, stored and used bythe organization


INFORMATION TECHNOLOGYAND ORGANIZATIONAL

DESIGN

Traditional forms and new organizational designs


Flat Organizational Structure

Hierarchical Organizational Structure

Pos. forInd.3 inregion 3



Ind. 3




Ind. 2



Position forInd. 1 inregion 1

Ind. 1

Region 3 Region 2 Region 1 RegionIndustry

Matrix Organizational Structure

Hierarchical, flat and matrixorganizational structures


In traditional hierarchical organizations

• Managers must understand standard operatingprocedures for the org’s primary activities

• Complexity is handled through organization ordivisions and subdivisions and then individual jobs– Complexity of the environment mimicked in the org. chart

(Ashby, 1956)

– Orgs s “assembly lines for decisions” (Toffler, 1985)

• Control systems are in place to see work is done ontime, properly and on budget.


Three roles IS playsin management control processes

1. IS enables the collection of information thatmay not be collectable other ways.

2. IS speeds the flow of information fromwhere it is generated to where it is needed.

3. IS facilitates the analysis of information inways that may not be possible otherwise.


New IT-enabled OrganizationalForms

• The “networked” organization– Instead of rigid hierarchies, all parts of the

company are connected by formal and informalcommunications.

• The “T-form” organization– Flattening by use of IT– IT actually does the work formerly done by

people


The networked organization

UnitedStates

Brazil

MoroccoMexico

France


T-Form Organization

• In the T-form organization, technology, especially theInternet plays an extensive role– Structurally, it “feels” flat– There is “unfettered access” to information– Individuals use electronic means to communicate– Work is often coordinated automatically– Business processes are designed differently– T-form org. networks have links to suppliers– T-form orgs. may connect to customers electronically


Virtual Organizations

• IT has made it possible for an individual to work for anorganization and live anywhere

• Virtual organization structure is “networked”.– Extensive collaboration takes place electronically, esp. e-mail

• Managers in a virtual environment monitor results, notprogress

• Forms are electronic, tech. support through a webinterface

• Business processes are also usually through the Web


Virtual Organization vs. the Virtual Corporation

• Virtual organization refers to the extensiveuse of IS and electronic links to create anextremely flexible organization

• Virtual corporation refers to a businessstrategy for allying complementarybusinesses and allowing them to respondto customers as a single entity (also madepossible through the extensive use of IS).


Achieving the ‘zero-time’ organization• Instant value alignment: understanding the customer so well that the company

anticipates and is therefore ready to provide exactly what the customer wants

• Instant learning: building learning directly into the company’s tasks andprocesses and making sure the requisite information is readily at hand when it isneeded.

• Instant involvement: using IS to communicate all relevant information tosuppliers, customers, and employees. Making sure everyone is prepared todeliver their products, services or information instantly.

• Instant adaptation: create a culture and structure enabling all workers to actinstantly and to make decisions to respond to customers.

• Instant execution: building business processes so that they have as few peopleinvolved as possible (no touch), electronically cross organizational boundariesand reduce cycle times so that processes appear to execute instantly.


HOW INFORMATIONTECHNOLOGY IS CHANGING

THE NATURE OF WORK


New Ways to do Traditional Work

– IT changes workers’ communication patterns– Workers using mobile devices can send and receive

message and tap into databases, affecting sales andservice tasks.

– The cost and time needed to access information isdramatically lower, giving workers new tools.

– Work has become much more team oriented an effectamplified by the Internet.

Q: Is info technology any different than any other technologychange? E.g., the steam engine, telephone, radio, automatedloom etc.

•How does IT change workers’ day-to-day tasks?


Creating New Types of Work

– knowledge managers,– systems analysts,– database and network administrators,– webmasters and web site designers.

• IS/IT use has created many new types of jobs.

Can you identify other examples?


What does this mean for managers?

• Sans co-location: How to manage a work force that isno longer in a single location.

• Distributed outputs: Work is also more teamoriented, making it more difficult to assess individualcontributions.

• Who/what supervises:– electronic employee monitoring systems, automates the

supervisory process,– may also hurt morale and undermine attempts to encourage

overall contributions to the organization.


Changes in employee supervision and evaluation

Focus on output ortarget. As long as theseare achieved,performance consideredadequate. Subjectivefactors less important,harder to gage.

Electronic, or assessedby deliverable. As longas the employee isproducing value, he doesnot need formalsupervision.

NewerApproach

Focus is on processthrough directobservation. Managersees how employeeperformed at work.Subjective (personal)factors are veryimportant.

Personal. Managerusually present or relieson others to ensureemployees are presentand productive

TraditionalApproach

Supervision Evaluation


Work Has created millions of new jobs, some in entirely new industries. Commodification of some work has allowed for outsourcing.

Working More work is team-oriented, enabled by communicationsArrangements and collaboration technologies. Geographic constraints of some professions are eliminated, enabling telecommuting.

Human New strategies are need to supervise, evaluateResources and compensate remotely performed, team-oriented work. IT requires new skills workers often lack.

Summary of IT’s effects on employeelife


IT and WHEREWORK IS BEING DONE


Telecommuting• Telecommuting is purported to:

– Lower corporate overhead since workers who are at homedon’t take up office space lowering facilities costs

– Give increased flexibility are more productive and expresshigher levels of job satisfaction

• 2/3’s of Cisco employees occasionally work from home. The policy hassaved the company $1M in expenses, while workers prefer to set their ownschedules and work in more comfortable surroundings.

Other impacts?

Might it allow the further ‘commodification’ and ‘temping’ ofthe work force?


ICT and driving factors on work

Provides workers withgeographic and time-shiftingflexibility.

Changing demographics andlifestyle preferences

Make remotely performed workpractical and cost-effective.

New technologies

Eliminates requirement thatcertain work be performed in aspecific place.

Shift to knowledge-based work

Driver Effect


Advantages and disadvantages of tele-sourced work

High level of self-discipline requiredHousebound individuals canjoin the workforce

Telecommuters are more easilyreplaced by electronic immigrants

Higher personal productivity

Employee may become disconnectedfrom company culture

Geographic flexibility

Harder to evaluate performanceReduced stress, heightenedmorale and lower absenteeism

Employee Advantages Potential Problems


THE PRODUCTIVITY PARADOX

Q: Does IS/IT Investment ImproveWorker Productivity?


– Some researchers argue ongoing costs outweighproductivity gains

– Other research suggests employee productivity is rising– Some argue the measurement of productivity is flawed;

e.g., fails to capture gains in service.

Mixed research findings

The controversy remains unresolved after many yearsof research.

Q: What might explain this?


Wrap Up• IT changes work.

– (Always has always will. Marx gets a big “I told youso.”)

• The less skilled and less educated pay the biggestprice

• Virtualization and networks allow for moredistributed work and place demands forcollaborative information systems, organizationalstructures and the adjustment of business models


Study questions

• Who benefits from technology change?• Who loses?• What is suggested for work design by the

increasing trend to anywhere, anytimecomputing?

day 3 information technology

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