Management Information Systems, 13E
Laudon & Laudon
Lecture Notes by Barbara J. Ellestad
Chapter 13 Building Information Systems
“What do you mean we have to change the way we make our candy bars? They are the number one selling product we have. Everyone loves them. Why can’t we just keep doing things the way we’ve always done them? It’s worked fine this long.”
It’s not unusual to hear this type of dialog in companies, large and small, all across the world. Change is hard on people and organizations. But it’s one of those necessary evils that keeps companies in the lead or helps destroy them. In this chapter, we’re going to focus on using information systems as a way to successfully help redesign organizations so they can improve their current processes or establish new ones.
13.1 Systems as Planned Organizational Change
It would be nice if we could give you a precise checklist of how to smoothly introduce a new information system, but we can’t. No one can. What we provide in this chapter is information you can use to help plan and analyze organizational changes associated with new systems development.
The triangle that we’ve used before is back…
All three elements will pose their own unique challenges to managers, but you may be surprised to learn that the hardware and software will probably be the easiest of the three to manage. Successfully reorganizing the company relies on more than just bringing in new equipment and new programs. Understanding and incorporating changes in the social and political climate in any organization is one of the most important aspects managers will have to deal with. Systems Development and Organizational Change
Change is disruptive. Change is dangerous. Change is good. Change is necessary. Change is constant.
Figure 13-1: Organizational Change Carries Risks and Rewards
This figure shows the four degrees of organizational change. Automation is the easiest (except for those people losing their jobs), and the most common form of change. But that doesn’t mean you don’t have to plan for the change first.
Rationalization of procedures causes the organization to examine its standard operating procedures, change the ones that don’t work well anymore, eliminate those no longer needed, and make the organization more efficient. It’s a good thing, as Martha Stewart would say!
Both of these types of change cause some disruption, but it’s usually manageable and relatively accepted by the people.
Total quality management, making quality control everyone’s responsibility, relies on an excellent information system that supplies workers and management with the data necessary to improve products and drive down costs. The lack of good, useful information may not be apparent until the organization can’t figure out what it’s doing wrong, or doing right. Data from all the types of information systems we discussed can be fed into quality management and make it easier to develop and improve products that blow away the competition.
Six Sigma is another initiative companies use to spot problems and correct them before they are too deeply embedded in the company’s processes. It just stands to reason that the longer a flaw is allowed to fester in the system, the more problems it may cause. And the more problems, the higher the costs. So if you can identify the defects early on and eliminate them, you can achieve more efficient production at lower costs. That’s the premise behind Six Sigma.
Business process redesign, on the other hand, can cause radical disruption. The mere mention of the term nowadays strikes fear in the hearts of workers and managers at all levels. Why? Because many companies use it as a guise for downsizing the organization and laying off workers. Business process reengineering causes planners to completely rethink the flow of work, how the work will be accomplished, and how costs can be reduced by eliminating unnecessary work and workers.
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