HCBA 3105: MANAGEMENT

INFORMATION SYSTEMS
o UNIVERSITY: TAITA TAVETA UNIVERSITY
COLLEGE
o PROGRAMME: MASTER OF BUSINESS
ADMINISTRATION
o YEAR: FIRST
o SEMESTER: ONE
o LECTURER: NICHOLAS M. MUTHAMA
o MSc. Applied Mathematics, MSc. Information
Systems Engineering, BSc. Hons 1
 Theoretical Basis of Strategic
Information Systems
o What is an IS?
o Information as a Factor of Production
o Theoretical Foundations
o Linking IS to the Organizational Mission
o How SIS Arise
o SIS Frameworks
Environment
Feedback & Control

Inputs Processes Outputs

Turban et al; O’Brien & Marakas 2

 Information Systems

o Inputs (data, instructions, information)

o Outputs (reports, calculations, solutions,
suggestions)
o Feedback mechanisms that control operations
o an Environment that it works within
o Processes – people, programs, storage
Environment
Feedback & Control

Inputs Processes Outputs

Turban et al; O’Brien & Marakas 3

 What is an IS?

ORGANIZATIONS TECHNOLOGY

INFORMATION
Organizational and Management Solu
SYSTEMS
based on IT, to probs/opport. posed by

MANAGEMENT

1- 4
 Indicators
Why Maximize Profit Return on equity
Profit, Risk, C
Purpose

Income/cost/unit

Minimize Risk % let

Debt

Maximize Customer relationships

Tenant satisfaction

How
PDLOCCCFA

Communicate
Activities

Administrate
Coordinate
Organize

Forecast
Control
Decide

Lead
Plan
Resources

With
Money
Money
Men
Men Machines Materials Methods
Machines Materials Methods
5M

5
 Scott Morton's forces
influencing Firms Objectives
If any one of 7
changes, External
others are affected Individuals& Technological
Roles. Staff, cust, suppliers Environment
innovation, vendors,
competitors,
obsolescence,
substitutes,
alternatives

Business Information &

Strategy Processes Technology
Plans & actions Design, develop, test,
deliver product/service to custs
install, maintain

External Organization
Socioeconomic Organisational
Boundary
Environment Structure
Costs, Govts, regulations, cust choice, who reports to who
social responsibility, ethics, deregulation,
globalisation, growth, new markets, staff Culture
Scott Morton; Turban et al 6
IS as an Integral Part of the
Organisation

Figure 2

Figure 1.8 How IS fit within the 4

Organizational Context
 Scott Morton's forces
influencing
If any one of 7 Firms Objectives
changes,
others are affected
Require convincing
Individuals External
& training Prepaid Tech
Technological
& Roles
avail.
Environment

Change to New ways of

Business Information
Design, develop,&test,
Strategy
prepaid collecting $,
Processes Technology
Install new ICT & IS
answering queries

Organization
External New depts –
Organisational Boundary
Socioeconomic prepaid, closing
Structure
Environment accounts
Govt. backing
Culture
Scott Morton; Turban et al 8
Valuing Information Systems

• Information systems can be used in three

ways to add value to an organization:

1. Automating
2. Informating
3. Strategizing

3-9
IS for Automating: Doing Things Faster

• With automation,
tasks can be
completed:
o Faster
o Cheaper
o More accurately
o With greater
consistency

3-10
Automating: Example
• Loan processing comparison for 3 methods
(from the moment the customer takes the
application until the applicant is notified of
decision)
o Manual loan process – 25 to 40 days
o Technology-supported process – 5 to 20 days
o Fully automated process – 1 hour to 15 days

3-11
IS for Organizational Learning:
Doing Things Better

• Information
systems can also
be used to:
o Learn about
processes
o Improve
processes
o Support
organizational
learning

3-12
Informating: Example
• Computer-
based loan
system
identifies peak
times during
the year when
specific loans
are processed
3-13
IS for Supporting Strategy: Doing
Things Smarter

• IS used to gain
or sustain
competitive
advantage
o Turning benefits
of automating
and informating
into strategic
advantage

3-14
 Where is information needed?

15

Executive
Management
Strategic

Middle Management Tactical

Supervisory Management
Opera-
tional

Operations

Anthony’s Triangle
Where are Systems deployed?
16

BI

DSS OAS

DW OLAP

TPS IOS
 External access to systems
17
Systems are
deployed upwards
IOS
and outwards in the EIS

organisation

DSS OAS

Increased DW

integration

HR AC FI MM SD CO

Leading to B2C, B2B, Etc

 Need to have Operational Effectiveness

18
 ...and Strategic Positioning

19
 What is Strategy?
20
 Summary of IT Strategy
21

Operational Effectiveness
– Necessary, but not sufficient for competitive advantage
– IT benefits will be more fleeting than the past
Strategic Positioning
– Support and reinforce the organisation’s unique positioning
– This requires understanding of your business strategy and unique positioning,
and understanding how IT fits in to it!

We can deduce from this and the Carr debate that IT in-and-of
itself is probably not a competitive advantage

For IT to be a strategic weapon, the organisation must be

operationally effective and also build a unique position!