MIS- Strategic Use of Information Systems by RushenChahal

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									Management Information Systems



 Strategic Use of Information Systems

          Prof. Rushen Chahal


              Prof. Rushen Chahal       1
 Information Systems for Competitive
             Positioning
• Objectives
• A Strategic Perspective on Information
  Systems
  – A. Why a New Perspective?
  – B. Change
• Information Systems in Strategic Thrusts
  – B. Creating Products & Services based on IS
  – C. Transforming Products/Processes with IS

                     Prof. Rushen Chahal          2
 Information Systems for Competitive
             Positioning
• Strategies, Forces, and Tactics in Competitive
  Markets
  – A. Competitive Systems
  – B. Competitive Forces
  – C. An example of Strategic Thrusts
  – D. Tactical Moves in Pursuing a Strategy
  – E. Strategic Cube
     • Z Figure 5.3 p 156


                        Prof. Rushen Chahal        3
 Information Systems for Competitive
             Positioning
• Value Chain Analysis of Strategic Opportunities
• Customer-Oriented Strategic Systems
  –   A. A Scenario:
  –   B. Outbound Logistics
  –   C. Marketing & Sales
  –   D. Service
• Strategic Systems in Operations
  – A. Manufacturing
  – B. Service Industries
                        Prof. Rushen Chahal         4
       Information Systems for
       Competitive Positioning
• Supplier-Oriented Strategic Systems: Inbound
  Logistics
• Organizational Requirements for Successful
  Strategic Information Systems




                   Prof. Rushen Chahal           5
       Information Systems for
       Competitive Positioning
• To Reengineer Business processes
  – A. Definition:
  – B. The reason for the shifts
  – C. Where are we Headed?
  – D. Using IT as a Catalyst for CHANGE
  – E. Principles Guiding Business Reengineering
  – F. Lesson about Reengineering
  – G. The role of the System Department

                     Prof. Rushen Chahal           6
        Information Systems for
        Competitive Positioning
• For Interorganizational Linkage
  – A. Characteristics of interorganizational Systems
    (IOS)
  – B. EDI
• Strategic Systems Can change how
  organizations work
  – A. Changing how decisions are made
  – B. Offering more communications options
  – C. Providing tools for coordination
                      Prof. Rushen Chahal               7
                Objectives
• Improve competitive position of organization
• Transform the way the organization does
  business
• Create a new perception of the nature of the
  business
• Change the firms products & services



                   Prof. Rushen Chahal           8
                  Objectives
• Create new relationships with the
  environment:
  – Customers
  – Suppliers
  – Competitors
  – Government
  – Partners
  – Employees
  – Community
                    Prof. Rushen Chahal   9
    A Strategic Perspective on
       Information Systems
“From the realization that IS may be designed
to give a firm an enhance ability to compete &
possible furnish the firm with a competitive
advantage in the market place"
– Zwass, 1992, p145




                  Prof. Rushen Chahal        10
        A Strategic Perspective on
           Information Systems
• A. Why a New Perspective?
   – The dynamics of information; Many organization both
   – produce goods & services
   – process information
   – Reduced cost of IT; The substitution power of IS: IS in
     place of resources (labor, materials)
   – An interaction effect: Educated people, technology &
     change in organization culture
   – The change started to occur in the 1980's with the birth of
     the USER- TRON


                          Prof. Rushen Chahal                  11
      A Strategic Perspective on
         Information Systems
• B. Change
  – A strategic system radically alters the way an
    organization does business
  – Most companies change via a series of small steps
  – Strategic benefits from a system: Lower cost;
    Market penetration = competitive advantage
  – The company may not attribute COMPETITIVE
    ADVANTAGE to IS, but one uses these to justify
    the IS

                     Prof. Rushen Chahal            12
              Information Systems
               in Strategic Thrusts
•   Competitive systems
•   Cooperative systems
•   Systems that change
•   What are Strategic Systems?
    – Strategy: a definition - The science or art of military
      command as applied to the overall planning conduct of
      large-scale combat operations. A plan of action resulting
      from the practice of this science. The art or skill of using
      stratagem in politics, business, courtship or the like.

                            Prof. Rushen Chahal                      13
        Information Systems
         in Strategic Thrusts
– Stratagem: A military maneuver designed to
  deceive or surprise an enemy.
– Strategic: Essential to the effective conduct of
  war. Designed to destroy the military potential of
  an enemy.
– Strategic Information System: An information
  system designed to give the owner organization a
  strategic competitive advantage.



                    Prof. Rushen Chahal            14
        Information Systems
         in Strategic Thrusts
– Strategic systems: A systems that supports or
  shapes a business unit's competitive strategy.
   • outward looking: customers, competitors,
     environments
   • inward looking: employees, systems, procedures
– Characteristics of Strategic systems:
– significantly changes business performance as
  measured by one or more key indicators. (Take no
  prisoners).
– contributes to attaining a strategic goal.
                     Prof. Rushen Chahal              15
         Information Systems
          in Strategic Thrusts
– fundamentally changes the way a company does
  business, or the way it competes, or the way it
  deals with its customers or suppliers. A
  PARADIGM shift.
– Differences between traditional systems and
  strategic
   • Traditional project management techniques to not
     work well for developing strategic systems. WHY?
   • the questions are unstructured, equivocal and
     uncertain.

                     Prof. Rushen Chahal                16
      Information Systems
       in Strategic Thrusts
• Strategic systems follow:
• a prototype form, tested on a small scale by the
  customers then iteratively developed piece by piece.
• User involvement is crucial both manager and
  customer.




                   Prof. Rushen Chahal                   17
         Information Systems
          in Strategic Thrusts
– A. Redefining Company Business
– What business are we in?
   • Actually a "new vision" is created as an answer
   • Build on existing strengths
   • Examples:
– B. Creating Products & Services based on IS
– C. Transforming Products/Processes with IS



                      Prof. Rushen Chahal              18
         Redefining Company
              Business
Company         Type                     New Vision
American        Financial                Information
Express         Service                  Business
Reuters         Financial                Financial
Holding         Information              Execution,
Merrill Lynch   Stock                    Financial Services
                Broker                   (CMA, EFTS)
Sears           Retailer                 Information
                (before 1992)            Business
Dun &           Financial                Information
Bradstreet


                   Prof. Rushen Chahal                        19
           Creating Products &
           Services based on IS
Company      Type                 Product/Service
Citicorp     Financial   Software - credit
             Service     unions international
                         banking
Backtel     Construction Construction
                         Management software
IBM/Sears                Prodigy
H & R Block Tax          Compuserve
Procurement Bidding      Matching system for
Technology Information government bids with
                         company profiles

                    Prof. Rushen Chahal             20
Transforming Products / Processes
             with IS
Company    Type                         Transformation
Federal    Shipping       Information:
Express                   Cosmos
UPS        Shipping       Information
Baxter     Pharmaceutical Automated Order
                          taking system
American                  Saber System:
Airlines                  Reservation
                          System
United                    Apollo System
Airlines

                  Prof. Rushen Chahal                    21
  Strategies, Forces, and Tactics in
        Competitive Markets
• A. Competitive Systems
• The watchwords for the 2000's
  – Innovation
  – Speed
  – Service
  – Quality
• To Stay in Business


                    Prof. Rushen Chahal   22
  Strategies, Forces, and Tactics in
        Competitive Markets
• a. To Gain Market Share (Federal Express)
  – Continuously improve quality
  – Improve the value of service
  – Get closer to the customers
  – Make an international business profitable
  – Produce strong cash flow




                     Prof. Rushen Chahal        23
  Strategies, Forces, and Tactics in
        Competitive Markets
• b. Uncovering Strategic Use of Systems
  – Analyze competitive forces
  – Study strategic thrusts
  – Study the value chain
  – Take the customer's view




                     Prof. Rushen Chahal   24
  Strategies, Forces, and Tactics in
        Competitive Markets
• c. Strategies: Z-1998 Figure 3.11 p96
  – Differentiation
  – Develop products & services which are different
    from what the competition offers
  – superior attributes
  – distinguishing features




                     Prof. Rushen Chahal              25
Competitive Strategies

                                      Competitive Advantage
                                 Lower Cost      Differentiation



                Broad                Cost
                                                 Differentiation
                Target            Leadership

  Competitive
    Scope
                Narrow                 Cost         Focused
                Target                Focus      Differentiation



                         Prof. Rushen Chahal                       26
Strategies, Forces, and Tactics in
      Competitive Markets
– Cost leadership
   • based on efficient operations
   • based on effective operations
   • economies of scale
      – become a low cost producer
      – market segmentation (niche)
– Focused differentiation
   • Market niche
– Cost focus
   • narrow market & low cost

                       Prof. Rushen Chahal   27
Prof. Rushen Chahal   28
Prof. Rushen Chahal   29
Prof. Rushen Chahal   30
  Strategies, Forces, and Tactics in
        Competitive Markets
• B. Competitive Forces
  – Threat of new entrants
  – Intensifying realty
  – Pressures from substitute products
  – Bargaining power of customers
  – Bargaining power of suppliers
  – Z-1998 Figure 3.12 p97



                     Prof. Rushen Chahal   31
Prof. Rushen Chahal   32
Strategies, Forces, and Tactics in
      Competitive Markets
– C.Process for uncovering strategic systems
  opportunities
   •   1. informal meetings to sell the idea
   •   2. a tutorial on the theory of strategic information
   •   3. Discussion of case examples
   •   4. BRAINSTORMING
   •   5. Executive brainstorming




                         Prof. Rushen Chahal                  33
  Strategies, Forces, and Tactics in
        Competitive Markets
• D. Tactical Moves in Pursuing a Strategy
  – Internal innovation
  – Internal growth (reengineering)
  – economies of scale (large volume)
  – economies of scope (Small volume)
  – Mergers
  – Strategic alliances



                    Prof. Rushen Chahal      34
The Strategic Cube

   COMPETITIVE
    FORCES TO
  CONTEND WITH
      Customer
         Power
       Supplier
        Power
       Present                                             Strategic
    Competitors                                         Alliance
      Potential                                     Merger or
    Competitors                                    Acquisition
                                               Internal Growth
     Substitute
      Products                               Internal
                                           Innovation   TACTICS




                  STRATEGIES
                     Prof. Rushen Chahal                          35
         Value Chain Analysis
      of Strategic Opportunities
• Definition: Value chain- consists of the major
  activities that have been added to the product
  during its creation, development or sale.
• Primary activities : the creation of product or
  service
  – inbound logistics - order entry data collection,
    obtain raw materials, subassemblies
  – Operations - order processing, MRP;
    transformation of inputs to finished goods
                      Prof. Rushen Chahal              36
         Value Chain Analysis
      of Strategic Opportunities
• Primary activities : the creation of product or
  service
  – Outbound logistics - distribution & sales data;
    storing products,
  – Marketing sales - promotions, discounting;
    establishing a customer need
  – Service activities - calls, returns, product rotation
    and maintenance


                       Prof. Rushen Chahal                  37
Value Chain with Typical Strategic IS
Mapped onto it


  EDI-Based    Computer-        Automated         Expert          Telemaintenance
  Purchasing   Integrated       Ordering          Systems for     Expert
  System       Mftg.            System            Salespeople     Systems

   Inbound                        Outbound            Marketing
                   Operations                                      Service
   Logistics                      Logistics           and Sales




 Upstream Chains                                           Downstream Chains
 of Suppliers                                              of Customers



                                Prof. Rushen Chahal                           38
Prof. Rushen Chahal   39
       Value Chain Analysis
    of Strategic Opportunities
• Support activities: The required infrastructure
  – Org's infrastructure
  – Human resources
  – Technology
  – Procurement




                      Prof. Rushen Chahal       40
         Value Chain Analysis
      of Strategic Opportunities
• Z-1992 fig 5.5 & 5.6




                    Prof. Rushen Chahal   41
Prof. Rushen Chahal   42
    Customer-Oriented Strategic
             Systems
• "How can we use IT to help our customers
  more easily acquire our products and get
  more value out of it?"
• The Customer Resource Life Cycle




                   Prof. Rushen Chahal       43
        The Customer Resource
             Life Cycle - 1
PHASES                         EXAMPLES
DETERMINE THE NEED             Videodisc system to select
Establish requirements         a product (fish)
Specify Attributes
                               PC to help determine
                               product features

                               PC system to locate
                               product



                    Prof. Rushen Chahal                44
         The Customer Resource
              Life Cycle - 2
PHASES                           EXAMPLES
ACQUIRE THE PRODUCT              On-Line yellow pages,
Locate the supplier              Airline reservation systems
Order the product                EDI order entry systems
Authorize and pay for            Electronic funds transfer
  product                          and billing systems
Acquire the product              JIT insurance
Test and accept the product      ATM’s MAC’s
                                 Drug store systems (check
                                   for other products the
                                   customer is using)
                      Prof. Rushen Chahal                 45
         The Customer Resource
              Life Cycle - 3
PHASES                           EXAMPLES
MANAGE THE                       On-Line inventory,
 PRODUCT’S USE                   shipment tracking systems
Maintain inventory
Monitor the product              Sales vs return to establish
Update the product               better stocking policies
Repair the product
                                 Automatic product
                                 upgrades

                                 Maintenance reminders
                      Prof. Rushen Chahal                  46
         The Customer Resource
              Life Cycle - 4
PHASES                           EXAMPLES
DISPOSE OF THE                   On-Line terminals for car
PRODUCT                          rentals
Dispose or transfer
Account for product              Record keeping for
                                 customers




                      Prof. Rushen Chahal                    47
      Customer-Oriented Strategic
               Systems
• Whence Success?
  – Opportunity costs: Switching costs of customer are low
    (from other supplier to you)
     • YOU provide hardware/software, training, custom
       implementation
     • You ensure the exit cost is high
  – Staying power based on time & money
     • exit costs
  – Offer responsive service
     • provide maintenance
     • provide upgrades Prof. Rushen Chahal              48
    Customer-Oriented Strategic
             Systems
– ISO
  • YOU know the customers business
– STRATEGIC BENEFITS
  • 1. Barriers to entry for new competitors are high
        – ordering systems take time to develop
        – costs are high (but are coming down)
  • 2. Prevent substitution of other products
  • 3. Market Segment leader: You have a DB of all your
    customers


                             Prof. Rushen Chahal          49
 Customer-Oriented Strategic
          Systems
• 4. You have reorganized your company based customer
  service and technology
   – provided value to your customers
   – Systems based JUST on technology DO NOT always create
     Competitive ADVANTAGE
   – (I.E. ATM's by Citicorp)




                       Prof. Rushen Chahal                   50
         B. Outbound Logistics
Service / System      Examples
Ordering Process      Ordering systems
Facilitation          Creditcard processing
Payments              to other firms
                      Debit Cards (Nice, etc)
Facilitation of       ATM’s for/as ATM’s
Information           distribution of tickets
                      student grades
                      Information on usage
Tracking              Fed Express/ UPS
Information
                  Prof. Rushen Chahal       51
         Customer-Oriented Strategic
                  Systems
• C. Marketing & Sales
  – The Key is to use IS added to the creativity of the
    people
  – Systems used in Marketing & Sales
     •   Ordering
     •   Customer DB's information by & about contact
     •   Telemarketing
     •   Quality
     •   Tracking
     •   Scheduling
     •   etc...             Prof. Rushen Chahal           52
          C. Market & Sales
System                          Company
Insulation requirement          Owens Coring
for homes                       Fiberglass
Properietary Clinical           Genentech:
data to Physicians              Notebook PC’s
Brokerage Services:
Match Customers                 Airline Guide
needs with suppliers            (Display flights)
Select & Configure              CAD / CAM - FMS
Marketing Analysis              Citicorp: From
                                credit card data
                 Prof. Rushen Chahal            53
      Customer-Oriented Strategic
               Systems
• D. Service
  – After Sales continuation of customer relationship
  – Reduce Cognitive dissonance




                       Prof. Rushen Chahal              54
              D. Services
System                                 Company
Maintenance Contract:                  Sears
send reminders
Mazda Follow-up
Double warranty on                     American
purchases                              Express
Tele-maintenance                       Stratus
system: Update on                      Computer Corp.
systems configurations
Diagnostics                            Westinghouse
Update of software                     Prodigy
                 Prof. Rushen Chahal                  55
             Strategic Systems
               in Operations
• A. Manufacturing
  – CIM
  – MRP II




                     Prof. Rushen Chahal   56
        5.6 Strategic Systems
            in Operations
– Z Figure 5.7 p166




                      Prof. Rushen Chahal   57
       Strategic Systems in
    Operations: Manufacturing
System      Benefit
CIM         Control of entire process
FMS         Units of 1
CAD / CAM   Configuration control for
            each customer
MRP II      Reduced inventory costs
            Reduced cycle time




             Prof. Rushen Chahal        58
     Strategies for CIM and BRP
• Fjermestad & Chakrabarti, 1993




                  Prof. Rushen Chahal   59
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Prof. Rushen Chahal   67
          Strategic Systems
            in Operations
• B. Service Industries
  – Anything that facilitates the information flow




                      Prof. Rushen Chahal            68
      Strategic Systems in
  Operations: Service Industries
System              Benefit
System              Benefit
1-800-DENTIST       Find a dentist
phone number        call back when queue
base ordering       is full
Direct meter        Reduced costs and
reading             time




                Prof. Rushen Chahal        69
     Supplier-Oriented Strategic
     Systems: Inbound Logistics
• Z-1992 Figure 5.6 p160




                  Prof. Rushen Chahal   70
     Supplier-Oriented Strategic
     Systems: Inbound Logistics
• Using IS to increase its POWER with Suppliers
• Want:
  – Price
  – Delivery Time (JIT)
  – Quality
  – Quantity
  – Service
  – Certification

                      Prof. Rushen Chahal         71
     Supplier-Oriented Strategic
     Systems: Inbound Logistics
• Want:
  – Control
  – Good relationship
  – Linkage
• GM Example:
  – JIT/ No-inventory
  – Certified / Quality
  – CAD/CAM for custom engineering
  – EDI for all transactions
                    Prof. Rushen Chahal   72
     Supplier-Oriented Strategic
     Systems: Inbound Logistics
• ShopRite Example:
  – a. UPC codes for collecting unit prices
  – b. PicePlus Club: Customer data
  – c. a & b customer data base
     • Information on:
     • Who buys what
     • Who buys when
  – d. point of sales coupons for the "other product"


                         Prof. Rushen Chahal            73
   Supplier-Oriented Strategic
   Systems: Inbound Logistics
– e. from a & b:
   • Crew scheduling
   • Shelf stocking
– f. portable scanners for inventory checking
– g. All linked with main local warehouse
– h. all line via EDI to suppliers
– i. get store demand fees for stocking new products



                       Prof. Rushen Chahal         74
    Organizational Requirements for
    Successful Strategic Information
                Systems
• Requirements for success
• Active support of Senior management
• Integrated Planning
• Direct reporting responsibilities of strategic
  Team
• Feedback & Control
    – budget
    – reward
      • correction
                     Prof. Rushen Chahal           75
 Organizational Requirements for
 Successful Strategic Information
             Systems
• Feedback & Control
  – Readiness: Culture, Resistance
  – sustainability
     • 1. lead time will allow the achievement of CA
     • 2. Copy cats may fail because of Uniqueness
     • 3. If copied: Your organization will still have Preempted
       the marketplace




                         Prof. Rushen Chahal                   76
             To Reengineer
           Business processes
• The 1980' focus is on the Competitive
  advantage
• The 1990's focus on internal outmode
  business practices




                   Prof. Rushen Chahal    77
             To Reengineer
           Business processes
• A. Definition: Fundamentally redesigning
  how the enterprise works-
  – procedures
  – control mechanisms
  – reporting relationships
  – decision makers
  – compensation criteria
  – The is to replace the paper-base world with IT

                     Prof. Rushen Chahal             78
                To Reengineer
              Business processes
• B. The reason for the shifts
  – 1. From competition
     •   Quality
     •   Cycle time
     •   customer service
     •   niche markets
  – 2. Failures in implementing IT
  – 3. Organizations are being forced to cut expenses
  – 4. The cost/performance of computer
    hardware/software has dropped
                            Prof. Rushen Chahal         79
             To Reengineer
           Business processes
• C. Where are we Headed?
  – Sprague Fig 3.5 p83




                     Prof. Rushen Chahal   80
              To Reengineer
            Business processes
• D. Using IT as a Catalyst for CHANGE
  – 1. Informate rather than automate:
     • use the information gathered about automated
       processes to improve the process or change the work
       performed
  – 2. Use different structures
     • centralized
     • decentralized
     • both


                       Prof. Rushen Chahal                   81
              To Reengineer
            Business processes
• E. Principles Guiding Business Reengineering
  – 1. Organize around Outcomes, Not tasks
     • Right!
  – 2. People who use the output should perform the
    process
     • order your own supplies
  – 3. Include information processing in the real work
    that produces the information
     • decentralization. At Ford the receiving department
       receive, process and authorizes payment
                        Prof. Rushen Chahal                 82
              To Reengineer
            Business processes
– 4. Treat geographically dispersed resources as if
  they were centralized
   • central purchasing department to negotiate contracts,
     local department to draw on the database
– 5. Link parallel activities rather than integrate
  them
   • work in parallel rather than sequenced
– 6. Let doers be self managing
   • the lowest level makes the decision
– 7. Capture information once at its source
   • Yes!             Prof. Rushen Chahal                    83
                To Reengineer
              Business processes
• F. Lesson about Reengineering
  – Synchronize:
     •   aligning strategy
     •   people
     •   technology
     •   business processes
  – to cut cost, reduce non-valued-added- work, and
    streamline client organizations


                         Prof. Rushen Chahal          84
            To Reengineer
          Business processes
– 1. Business integration is a Process, not a project
– 2. People need time to change
– 3. Recognize the potential up front, get people
  involved early
– 4. Make job change throughout the organization
– 5. Manage the pace of change




                    Prof. Rushen Chahal                 85
              To Reengineer
            Business processes
• G. The role of the System Department
  – 1. Be an influencer
  – 2. Participate on multifunctional teams
  – 3. Build more Flexible Applications faster
  – 4. Introduce processing supporting technologies.
     • Image processing
     • EDI, Groupware, video conferencing, E-mail
  – 5. Manage the technical architecture
     • flexibility
     • adaptability
                       Prof. Rushen Chahal             86
   For Interorganizational Linkage
• A. Characteristics of interorganizational
  Systems (IOS)
  – 1. IOS require partners
  – 2. Standards
  – 3. Education
  – 4. Coordination via third parties (consultants)
  – 5. The work must be synchronized
  – 6. Work processes are to be reevaluated
  – 7. Technical aspects are the easy ones
  – 8. Effort cannot be secretive
                      Prof. Rushen Chahal             87
   For Interorganizational Linkage
• Cooperative Systems
  – Definition: Coordination- the act of working together
  – The definition of cooperative is nested within
    coordination.
  – Sprague Fig 3.7 p96 (also 3.4)
• B. EDI
  – The computer to computer exchange of standard business
    transactions
  – payment/remittance
  – request for quotations
                        Prof. Rushen Chahal                 88
   For Interorganizational Linkage
• B. EDI (con’t)
  – purchase order
  – logistics
  – Applications that have the greatest Benefits:
     • they involve a large number of transactions
     • these transactions require careful and accurate
       reporting
     • they make it easier for the customer to purchase goods
       & services


                        Prof. Rushen Chahal                 89
Strategic Systems Can change how
        organizations work
• A. Changing how decisions are made
• B. Offering more communications options
• C. Providing tools for coordination




                  Prof. Rushen Chahal       90
Strategic Systems Can change how
        organizations work
• A. Changing how decisions are made
  – To match the increasing turbulence and
    complexity organizational decision making will be:
     • more frequent
     • performed faster
     • more complex




                          Prof. Rushen Chahal        91
Strategic Systems Can change how
        organizations work
 – Thus three technologies will be needed:
    •   advanced computer and communications technologies
    •   computer message system
    •   computer conferencing
    •   video conferencing
    •   decision group technologies (GDSS) as environmental
        complexity increases there will be a need for more
        information exchanging either via meetings of CMC.




                        Prof. Rushen Chahal               92
Strategic Systems Can change how
        organizations work
 – Thus systems (CMC) with different structures to
   aid different problems (i.e. EBS, DI, Agenda
   setting, etc)
    •   Technology support for managing decision processes
    •   project mgt for DM
    •   more rapid techniques
    •   expert systems
    •   AI
    •   Structuring techniques


                        Prof. Rushen Chahal                  93
Strategic Systems Can change how
        organizations work
• B. Offering more communications options
  – E-mail, CMC, GDSS, CSCW
  – These systems can ease and enhance
    communication between individuals and groups.




                    Prof. Rushen Chahal             94
Strategic Systems Can change how
        organizations work
 – 1. Among Individuals
    • time and distance can be collapsed
    • small messages will no longer be a potential bother to
      other people
    • communication has increase
    • thus people are better informed
    • problems are resolved much faster; people get the
      point more quickly when messages are typed
    • memo wars decrease
    • CMC encourages action; messages are informal yet to
      the point
                       Prof. Rushen Chahal                     95
Strategic Systems Can change how
        organizations work
 – 2. Among groups
   • time and distance are collapsed
   • people can easily signal interests to other people
   • messages can easily be sent to other people
   • E-mail reduces the costs of finding people with mutual
     interests
   • Can build strong ties (within group) weak ties between
     groups




                      Prof. Rushen Chahal                 96
Strategic Systems Can change how
        organizations work
 – 2. Among groups
   • E-mail encourages intergroup communication because
     it reduces time and effort
   • filtering mechanism become important to screen in/out
     important/junk mail
   • innovation/ effectiveness can be improved
      – A second order effect
      – A first order effect is efficiency




                          Prof. Rushen Chahal           97

								
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