Information Technology in Management

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Chapter 14

• Information Technology in Management

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Topics

• Managing a Business or Organization
• Types of Management Decisions
• Management Information Requirements
• Information Technology to Support Managerial
  Communications
• Information Technology to Support Managerial
  Decision Making
• Information Technology to Support Business
  Strategy

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Managing a Business or Organization

• Managers have several functions in an
  organization, all aimed at accomplishing the
  goals and objectives of the firm.

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Managing a Business or Organization

• Managers play several roles in an organization,
  interacting with other managers, employees,
  customers, vendors, and other people.

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Types of Management Decisions

• Managers use several methods to solve different
  types of problems in various decision- making
  situations.

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Types of Management Decisions

• An organization usually has a hierarchy of
  managers responsible for work at several levels.

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Management Information Requirements

• Information has several dimensions and
  characteristics that can be adjusted to make the
  information more valuable to a manager.

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Information Technology to Support Managerial
Communications

• Communication is critical for individuals to be
  able to work together.

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Communication Concepts

• A sender must convey
• The message must be transmitted reliably
• A receiver must receive

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Communication Concepts

• One-to-one communication
• One-to-many communication
• Many-to-many communication

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Communication Concepts

• Same-place communication
• Different-place communication
• Same-time communication
• Different-time communication

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Communication Concepts
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Collaborative Work

• A workgroup can be
• A committee
• A product design team
• An executive board
• Any group of people who act as a single social
  unit to perform some task

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Distributed Computing . . .

• Distributed Computing integrating all kinds of
  computers into a single seamless system.

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The Automated Office

• Enables individuals, workgroups, and
  organizations to acquire, process, store, and
  distribute information electronically, using
  computers and telecommunication networks.

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Intraorganizational Information Systems

• EDI Electric Data Interchange

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Business Alliances
A cooperative arrangement between two or more
businesses with complementary capabilities.
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International Information Systems
Information technology, especially networks,
telecommunications, and the Internet, have made
it economically feasible for a company to do
business internationally and conduct its business
processes virtually anytime and anywhere.
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Information Technology to Support Managerial
Decision Making

• Decision-Making Concepts
• Management Information Systems
• Decision Support Systems
• Executive Information Systems
• Expert Systems
• Expert Systems in Action
• Information Systems in Perspective

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Decision-Making Concepts

• Decision making involves understanding the
  problem, identifying possible solutions,
  selecting the most desirable solution, and
  implementing it.

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Management Information Systems

• The components of a management information
  system. Managers can use the system to access
  information about the companys business
  processes.

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Decision Support System

• The components of a decision support system.
  Managers can use the system interactively to
  analyze information for decision making.

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Components of a Decision Support System
Data Management
Model Management
Dialog Management
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Group Decision Support Systems

• Group decision support systems can enhance the
  dynamics of face-to-face contact in group
  meetings.

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Executive Support System

• The components of an executive information
  system. Managers can use the system to monitor
  the important economic and social trends
  affecting the organization, as well as the
  important performance measures of the company.

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Expert Systems

• An expert system (ES) supports decision making by
  providing managers with access to computerized
  expert knowledge.

• A KNOWLEDGE BASE
• AN INFERENCE ENGINE
• A USER INTERFACE

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Components of an Expert System

• The components of an expert system. The software
  modules perform inferences on a knowledge base
  built by an expert or both. This provides expert
  answers to a users question in an interactive
  process.

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Expert Systems in Action
The expert system leads the user through the
process of diagnosing problems with
malfunctioning cameras.
American Express uses an expert system to
automate the process of checking for fraud and
misuses of its no-limit credit card.
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Comparison of design features for MIS, DSS, EIS,
and ES
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Information Technology to Support Business
Strategy

• A strategy is an organization's intention to
  pursue a set of activities over the long term to
  attain its goals.
• An organization uses the the competitive forces
  model to evaluate its environment and choose a
  strategy that will help it achieve a
  competitive advantage.

Business is a good gamelots of competition and a
minimum of rules. You keep score with
money. Nolan Bushnell, founder of Atari
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Strategic Information Systems

• THE COMPETITIVE FORCES MODEL
• Competition the degree of competitive rivalry
  among firms in an industry
• New Competition the probability of new companies
  entering the industry
• Customers the relative bargaining strength of
  customers
• Suppliers the relative bargaining strength of
  suppliers
• Substitution the probability that customers may
  substitute or switch to other products or
  services.

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Competitive Forces

• Managers can decide how best to use information
  technologies by understanding the competitive
  forces in the business environment.

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Competitive Forces

• A cost leadership strategy focuses on providing
  high-quality products and services at the lowest
  cost in the industry.
• A differentiation strategy focuses on providing
  products and services that are particularly
  valued and are perceived by customers as uniquely
  different from the competition.
• An innovation strategy emphasizes finding new
  ways to restructure business processes for
  producing or distributing products and services
  or developing unique products and services.

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Strategic Uses of Information Technology
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