Information Technology and Organizational Decision Making

Motivation for creating a theory of effects of advances IT on organizations

Reinvestigate the effects of IT on organization Create a theory of the effects of advance IT on organization Integration Practical, administrative importance

Reinvestigate the effects of IT on organization

Effectiveness of Advanced IT– Communication medium

Face to face reporting Vs e-mail

– Computer-assisted decision-aiding technologies Expert systems, decision-support system

Crate a theory of the effects of IT on organization

To explore and understand the effects of advances IT has on an organization.

To set a standard theory concerning the effects of advanced information technologies on organizations.

Integration

To help researchers in each of the fields to become more aware of the existence, content, and relevance of the work done by researchers in other fields by putting all their works into one theory

Practical, administrative importance

In the absence of experience, the value of theory is important to administrators or advisors when implementing advances IT onto the organization

Traditional information technologies

Operating software– Microsoft Windows XP

Computers “Simple” application

– Microsoft Offices, and Quick Book

Advance information technologies

Transmit, manipulate, analyze, or exploit information

Digital computer processes information integral to the user’s communication or decision support

Nature of advance IT

Two characteristics– Basic characteristics of advance IT– Properties of advance IT

Basic characteristics of advance IT

Data storage capacity– Hard drive, removable media, and tapes

Transmission capacity– WAN, LAN, and wireless technologies

Processing capacity– CPU processing power, memory storage, and

Databases processing

Properties of advance IT

More relevant to task Improve the overall performance of user Support user every day task

Example of properties of advance IT

Communication– Ability to communicate more easily and less expensively – Ability to communicate more rapidly and with greater precision to targeted

groups– Ability to record and index more reliably and inexpensively the content and

nature of communication events– Selectively control access and participation in a communication event or

network

Example of properties of IT

Decision aiding– Store and retrieve large amounts of information more

quickly and inexpensively– More rapidly and selectively access information created

outside the organization– More rapidly and accurately combine and reconfigure

information so as to create new information– More compactly store and quickly use the judgment and

decision models developed in the minds of experts– More reliably and inexpensively record and retrieve

information about content and nature of organizational transactions

Mistaken impressions on advances IT

Advanced IT does not replace traditional IT, but a supplements to traditional IT

There are no inferior or superior between advances IT and traditional IT (working side by side) to improve users productive

Environments affecting advance IT

External environments of many organizations are sufficiently competitive that, in order to survive, the organizations must adopt and properly use rationality-enhancing communication and decision-aiding technologies.– Outside Competition drive the implementation and

usage of advance IT to gain advantage over the competitions

Environments affecting advance IT

Highly politicized or power-driven organizations which also have highly competitive internal environments, and in such environments it is necessary for managers to maximize their own competitive effectiveness by appearing to satisfy the goals of resource controllers on an issue-by-issue basis.

– Internal competition between department drive the implementation and usage of advance IT

Environments affecting advance IT

Almost all organizations, effective fulfillment of organizational responsibilities contributes to the development and maintenance of a manager’s reputation.– Mangers try to use advance IT to his or her

personal effectiveness to maintain his or her reputation

Effect at the subunit level

Participation in decision making Size and heterogeneity of decision units Frequency and duration of the meetings

Effect at the subunit level

What is the effect of the computer-assisted communication technology on the breadth of

participation in decision making?

Effect at the subunit level

Proposition 1: Use of computer-assisted communication technologies leads to a larger number and variety of people participating as information sources in the making of a decision.

Proposition 1

Reduce effort to gather and exchange information– internet, information system, database

Increase number of people participating in decision making process– More research, less expert

Speed up the information gathering process

Limitation on Proposition 1

Increase in participation might not lead to higher quality decisions

Might not increase practical significance Might not even be more effective (too much

input)

Effect at the subunit level

What is the effect of computer-assisted communication and decision-support

technology on the size and heterogeneity of decision units?

Effect at the subunit level

Proposition 2: Use of computer-assisted communication and decision-support technologies leads to decrease in the number and variety of members comprising the traditional face-to-face decision unit.

Proposition 2

Experts replaced by expert systems Information keepers replaced by

management information system Face-to-face decision unit replaced by e-mail

communication, teleconferencing or videoconferencing

Effect at the subunit level

What is or what will be the effect of computer-assisted communication and decision-

support technologies on the time absorbed by meetings?

Effect at the subunit level

Proposition 3: Use of Computer-assisted communication and decision support technologies results in less of the organization’s time being absorbed by decision related meetings

Proposition 3:

Decrease in traditional face-to-face decision unit Replace with short “mini-meetings” More informal meetings

Conclusion

Effects of Advances IT at the subunit level– Increase the participation in the decision making– Decrease the number of members comprising

traditional face-to-face decision unit– Less time spend on decision related meetings

Thank you for your time!

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