SUMMARY chapter 3
1. Identify and describe important features of organizations that managers need to know about in order to build and use
information systems successfully.
Managers need to understand certain essential features of organizations to build and use information systems successfully. All modern
organizations are hierarchical, specialized, and impartial, using explicit routines to maximize efficiency. All organizations have their
own cultures and politics arising from differences in interest groups, and they are affected by their surrounding environment.
Organizations differ in goals, groups served, social roles, leadership styles, incentives, types of tasks performed, and type of
structure. These features help explain differences in organizations’ use of information systems.
2. Evaluate the impact of information systems on organizations.
Information systems and the organizations in which they are used interact with and influence each other. The introduction of a new
information system will affect organizational structure goals, work design, values, competition between interest groups, decision
making, and day-to-day behavior. At the same time, information systems must be designed to serve the needs of important
organizational groups and will be shaped by the organization’s structure, task, goals, culture, politics, and management. Information
technology can reduce transaction and agency costs, and such changes have been accentuated in organizations using the Internet.
Information systems are closely intertwined with an organization’s structure, culture, and business processes. New systems disrupt
established patterns of work and power relationships, so there is often considerable resistance to them when they are introduced.
The complex relationship between information systems, organizational performance, and decision making must be carefully
3. Demonstrate how Porter’s competitive forces model and the value chain model help businesses use information systems for
In Porter’s competitive forces model, the strategic position of the firm and its strategies are determined by competition with its
traditional direct competitors but also they are also greatly affected by new market entrants, substitute products and services,
suppliers, and customers. Information systems help companies compete by maintaining low costs, differentiating products or
services, focusing on market niche, strengthening ties with customer and suppliers, and increasing barriers to market entry with high
levels of operational excellence.
The value chain model highlights specific activities in the business where competitive strategies and information systems will have the