Strategic Information Management Challenges and strategies in managing information systems Third edition

References

Ciborra, C. U. and Associates (2000). From Control to Drift: The Dynamics

of Corporate Information Infrastructures, Oxford University Press,

Oxford.

Earl, M. J. (1989). Management Strategies for Information Technology,

Prentice Hall, London.

Galliers, R. D. (1991). Strategic information systems planning: myths, reality,

and guidelines for successful implementation. European Journal of

Information Systems, 1(1), 55–64.

Reich, B. H. and Benbasat, I. (1996). Measuring the linkage between business

and information technology objectives, MIS Quarterly, 20(1), 55–81.

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Introduction: The Emergence

of Information Technology as

a Strategic Issue

Although information systems of some form or another have been around since the beginning of

time, information technology (IT) is a relative newcomer to the scene. The facilities provided by

such technology have had a major impact on individuals, organizations and society. There are few

companies that can afford the luxury of ignoring IT and few individuals who would prefer to be

without it . . . despite its occasional frustrations and the fears it sometimes invokes.

An organization may regard IT as a ‘necessary evil’, something that is needed in order to stay

in business, while others may see it as a major source of strategic opportunity, seeking proactively

to identify how IT-based information systems can help them gain a competitive edge. Regardless

of the stance taken, once an organization embarks on an investment of this kind there is little

opportunity for turning back.

As IT has become more powerful and relatively cheaper, its use has spread throughout

organizations at a rapid rate. Different levels in the management hierarchy are now using IT

where once its sole domain was at the operational level. The aim now is not only to improve

efficiency but also to improve business effectiveness and to manage organizations more

strategically. As the managerial tasks become more complex, so the nature of the required

information systems (IS) changes – from structured, routinized support to ad hoc, unstructured,

complex enquiries at the highest levels of management.

IT, however, not only has the potential to change the way an organization works but also the

very nature of its business (see, for example, Galliers and Baets, 1998). Through the use of IT to

support the introduction of electronic markets, buying and selling can be carried out in a fraction

of the time, disrupting the conventional marketing and distribution channels (Malone et al., 1989;

Holland, 1998). Electronic data interchange (EDI) not only speeds up transactions but allows

subscribers to be confident in the accuracy of information being received from suppliers/buyers

and to reap the benefits of cost reductions through automated reordering processes. On a more

strategic level, information may be passed from an organization to its suppliers or customers in

order to gain or provide a better service (Cash, 1985). Providing a better service to its customers

than its competitors may provide the differentiation required to stay ahead of the competition in

the short term. Continual improvements to the service may enable the organization to gain a

longer-term advantage and remain ahead.

The rapid change in IT causes an already uncertain business environment to be even more

unpredictable. Organizations’ ability to identify the relevant information needed to make

important decisions is crucial, since the access to data used to generate information for decision

making is no longer restricted by the manual systems of the organization. IT can record,

synthesize, analyse and disseminate information quicker than at any other time in history. Data

can be collected from different parts of the company and its external environment and brought

together to provide relevant, timely, concise and precise information at all levels of the

organization to help it become more efficient, effective and competitive.

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2

Strategic Information Management

Information can now be delivered to the right people at the right time, thus enabling well-

informed decisions to be made. Previously, due to the limited information-gathering capability of

organizations, decision makers could seldom rely on up-to-date information but instead made

important decisions based on past results and their own experiene. This no longer needs to be the

case. With the right technology in place to collect the necessary data automatically, up-to-date

information can be accessed whenever the need arises. This is the informating quality of IT about

which Zuboff (1988) writes so eloquently.

With the use of IT, as with most things, comes the possibility of abuse. Data integrity and

security is of prime importance to ensure validity and privacy of the information being held.

Managing the information involves identifying what should be kept, how it should be organized,

where it should be held and who should have access to it. The quality of this management will

dictate the quality of the decisions being taken and ultimately the organization’s survival.

With the growth in the usage of IT to support information provision within organizations, the

political nature of information has come into sharper focus. Gatekeepers of information are

powerful people; they can decide when and if to convey vital information, and to whom. They are

likely to be either highly respected, or despised for the power that they have at their

fingertips.

Such gatekeepers have traditionally been middle managers in organizations. Their role has been

to facilitate the flow of information between higher and lower levels of management. With the

introduction of IT such information can now be readily accessed by those who need it (if the right

IT infrastructure is in place) at any time. It is not surprising then that there is resistance to the

introduction of IT when it has the potential of changing the balance of power within

organizations. Unless the loss in power, through the freeing up of information, is substituted by

something of equal or more value to the individuals concerned then IT implementations may well

be subject to considerable obstruction.

Developments in IT have caused revolutionary changes not only for individual organizations

but for society in general. In order to understand the situation we now find ourselves in with

respect to IT, it is as well to reflect on their developments. This is the subject matter of Chapter

1. Written by Somogyi and Galliers, it describes how the role of IT has changed in business and

how organizations have reacted to this change. They attempt, retrospectively, to identify major

transition points in organizations’ usage of IT in order to provide a chronicle of events, placing

today’s developments in a historical context. The chapter charts the evolution of the technology

itself, the types of application used by organizations, the role of the DP/IS function and the change

in the methods of system development. Such histories are not merely academic exercises, they can

serve as a foundation for future progress, allowing organizations to avoid past mistakes and to

build on their successes. A postscript has been added in order to bring the original article up to

date, listing a number of key applications that have appeared over the past decade or so.