Describe the major behavioral theories that help explain how information system affect organization

1.    Which features of organizations do managers need to know about to build and use information systems successfully? What is the impact of information systems on organizations?

Define an organization and compare the technical definition of organizations with the behavioral definition.

The technical definition defines an organization as a stable, formal social structure that takes resources from the environment and transfer them to outputs produce. And it is focuses on Capital, labor, and production and products for consumption. Also reflect that organizations are more stable, are formal legal entities, and are social structures.

The behavioral definition a groups of rights, obligations, privileges, and responsibilities which balanced over a period of time through conflict and conflict resolution. This definition concentrates the people within the organization, their ways of working, and their relationships.

The technical definition shows us how a firm combines capital, labor, and information technology.

The behavioral definition examines how information technology affects the inner workings of the organization.

Identify and describe the features of organizations that help explain differences in organizations’ use of information systems.

Routines and Business Processes: standard operating procedures are precise rules, procedures, and practices that have been developed to cope with virtually all expected situations. As employees learn these routines, they become highly productive and efficient, and the firm is able to reduce its costs over time as efficiency increases.

Organizational Politics: divergent viewpoints about how resources, rewards, and punishments should be distributed. Political resistance is one of the great difficulties of bringing about organizational change especially the development of new information systems.

Organizational Culture: Assumptions that define the organizational goals and products create a powerful restraint on change, especially technological change.

Organizational Environments: Reciprocal relationships exist between an organization and environments; information systems in helping organizations

Perceive changes in their environments and also in helping organizations act

On their environments. Information systems are key instruments for environmental scanning, helping managers identify external changes that might requirean organizational response.

Organizational Structure: kind of information systems that reflects the type of organizational structure entrepreneurial, machine bureaucracy, divisional zed bureaucracy, professional bureaucracy.

Describe the major economic theories that help explain how information systems affect organizations.

The two economic theories discussed in the book are transaction agency theory and cost theory. The transaction cost theory is based on the notion that a firm instead making products for itself incurs transaction costs when it buys goods in the marketplace. Traditionally, firms look to lower transaction costs by getting bigger, small-company takeovers, hiring more employees, vertical and horizontal integration, Information technology helps firms reduce  the cost of transaction costs and greater. Amount of output and helps firms shrink in size while producing the same.

The agency theory views the firm as relation of contracts among interested individuals. The owner employs agents (employees) to do work on his or her behalf and delegates some decision making authority to the agents. Agents need steady supervision and management, which introduces management costs. As management costs rise, firms grow. Information technology reduces agency costs by providing information more easily therefore managers can supervise a larger number of people with fewer resources.

Describe the major behavioral theories that help explain how information systems affect organizations.

Behavioral theories are useful for describing the behavior of individual firms. Behavioral researchers consider that information technology could change the decision-making by reducing the costs of information acquisition and distribution. IT could eliminate middle managers and their clerical support by sending information from operating units directly to senior management and by enabling information to be sent directly to lower-level operating units. Also enables some organizations to act as virtual organizations because they are no longer limited by geographic locations.

One behavioral approach views information systems as the outcome of political competition between organizational subgroups. IT becomes involved with this competition because it controls who has access to information, and information systems can control who does what, when, where, and how.

Explain why there is considerable organizational resistance to the introduction of information systems.

There is considerable organizational resistance to new information systems because they change many important organizational dimensions, such as structure, culture, politics, and work. Leavitt puts forth a model that says that changes in technology are absorbed, deflected, and defeated by organizational task arrangements, people and structures. In this model the only way to bring about change is to change the technology, structure, tasks and people simultaneously. In a second model, the authors speak of the need to unfreeze organizations before introducing an Innovation, quickly implementing the new system, and then refreezing the change.

Describe the impact of the Internet and disruptive technologies on organizations.

The Internet increases the accessibility, storage, and distribution of information and knowledge for organizations; nearly any information can be available anywhere at any time. The Internet increases the depth, scope, and range of information and knowledge storage. It lowers the cost and raises the quality of information and knowledge distribution. That is, it lowers transaction costs and information acquisition costs. By using the Internet, organizations may reduce several levels of management, enabling closer and quicker communication between upper levels of management and the lower levels. The Internet also lowers agency costs. Disruptive technologies caused by technological changes can have different effects on different companies depending on how they handle the changes. Some companies create the disruptions and succeed very well. Other companies learn about the disruption and successfully adopt it. Other companies are obliterated by the changes because they are very efficient at doing what no longer needs to be done. Some disruptions mostly benefit the firm. Other disruptions mostly benefit consumers.

2- How does Porter’s competitive forces model help companies develop competitive Strategies using information systems?

Define Porter’s competitive forces model and explain how it works.

This model provides a general picture of the firm, its competitors, and the firm's environment. Porter's model is all about the firm's general business environment. In this model, five competitive forces shape the fate of the firm such as:

Traditional competitors:

All firms share market space with other competitors who are continuously devising new, more efficient ways to produce by introducing new products and services, and attempting to attract customers by developing their brands and imposing switching costs on their customers.

New market entrants:

By new companies that are always entering in the marketplace. In some industries, there are very low barriers to entry, whereas in other industries, entry is very difficult. For instance, it is fairly easy to start a pizza business or just about any small retail business, but it is much more expensive and difficult to enter the computer chip business, which has very high capital costs and requires significant expertise and knowledge that is hard to obtain.

Substitute products and services:

In just about every industry, there are substitutes that your customers might use if your prices become too high. New technologies create new substitutes all the time. For example, an Internet music service that allows you to download music tracks to an iPod is a substitute for CD-based music stores. The more substitute products and services in your industry, the less you can control pricing and the lower your profit margins.

Customers:

Depends in large measure on its ability to attract and retain customers.

The power of customers grows if they can easily switch to a competitor's products and services, or if they can force a business and its competitors to compete on price alone in a transparent marketplace where there is little product differentiation, and all prices are known instantly (such as on the Internet).

Suppliers:

The market power of suppliers can have a significant impact on firm profits, especially when the firm cannot raise prices as fast as can suppliers. The more different suppliers a firm has, the greater control it can exercise over suppliers in terms of price, quality, and delivery schedules. For instance, manufacturers of laptop PCs almost always have multiple competing suppliers of key components, such as keyboards, hard drives, and display screens.

Describe what the competitive forces model explains about competitive advantage.

Some firms produce better than others because they either have access to special resources that others do not, or they are able to use commonly available resources more efficiently. in addition, they can use new technology that is chive to the goals of organization. It could be because of superior knowledge and information assets. Regardless, they excel in revenue growth, profitability, or productivity growth, ultimately increasing their stock market valuations compared to their competitors.

List and describe four competitive strategies enabled by information systems that firms can pursue.

There are four generic strategies, each of which enabled by using information technology and systems include:

- Low-cost leadership: Lowest operational costs and the lowest prices.

- Product differentiation: Enable new products and services, or greatly change the customer convenience in using existing products and services.

- Focus on market niche: Enable a specific market focus and serve this narrow target market well than competitors.

- Strengthen customer and suppliers: Tighten linkages with suppliers and develop intimacy with customers by make good relationship.

Describe how information systems can support each of these competitive strategies and give examples.

- Low-cost leadership: Use information systems to improve inventory management, supplyManagement, and create efficient customer response systems. Example: Wal-Mart.

- Product differentiation: Use information systems to create products and services that are Customized and personalized to fit the precise specifications of individual customers.

Example: Google, eBay and Apple.

- Focus on market niche: Use information systems to produce and analyze data for finelytuned sales and marketing techniques. Analyze customer buying patterns, tastes, andPreferences closely in order to efficiently pitch advertising and marketing campaigns to

Smaller target markets. Example: Hilton Hotels.

- Strengthen customer and supplier intimacies: Use information systems to facilitate direct

Access from suppliers to information within the company. Increase switching costs and

Loyalty to the company. Example: IBM, Amazon.com.

Explain why aligning IT with business objectives is essential for strategic use of systems

The basic principle of IT strategy for a business is to ensure the technology serves the business and not the other way around. The more successfully a firm can align its IT with its business goals, the more profitable it will be. Business people must take an active role in shaping IT to the enterprise. They cannot ignore IT issues. They cannot tolerate failure in the IT area as just a nuisance to work around. They must understand what IT can do, how it works, and measure its impact on revenues and profits.

How information systems affect organizations behaviorally?

How do information systems affect the performance of organizations?

How are the behavioral and technical definitions of an organization different?

Why is there considerable resistance in organization towards introduction of information system?