DB 2

ITC 5301, Management Information Systems 1

Course Learning Outcomes for Unit II Upon completion of this unit, students should be able to:

3. Explain how information technology systems influence organizational strategies. 3.1 Explain an organization’s ability to use information technology to achieve strategic goals.

4. Evaluate the prevailing ethical issues of information systems.

4.1 Describe how new technology trends may cause ethical dilemmas. Required Unit Resources Chapter 3: Information Systems, Organizations, and Strategy Chapter 4: Ethical and Social Issues in Information Systems Unit Lesson

Information Systems: What This Means to Your Organization For most of us, it is not that difficult to understand certain information technology (IT) concepts. Most of us use our hardware and equipment fairly well. We know how to download apps on our smartphones. We know about the systems and applications that we use at work. We may not know all of the details or inner workings of what information flows where, but we have a good idea of how things work. If we were clueless, we would not be of much value to our organizations, would we?

Organizations and Strategy Let’s take this to a more abstract level. How would you answer this question: How is IT used toward the success of your organization? You might rattle off some reasons relating to the availability of the Internet, which allows e-mails to flow so that there is connectivity between customers and service representatives. You might say that your organization has several servers and databases that house data and a security team with security tools that ensure the safety of the data. You might mention that all the applications allow you to service your customers in faster, more efficient ways. If you are a little more tech savvy at your organization, you might even bring up more advanced topics or newer innovations, such as the ones listed below.

• e-commerce • supply chain management systems (SCM) • customer relation management systems (CRM) • SharePoint • cloud collaboration • enterprise resource planning (ERP) • Systems, Applications, and Products (SAP) • big data • data mining • expert systems

Are the items described here IT tools? Yes, they are used to help make everyone’s lives and jobs easier, faster, more efficient, and more effective, but let’s ask the question again: How is IT used toward the success of your organization?

UNIT II STUDY GUIDE Organizations, Strategy, Ethics, and Social Issues in Information Systems

ITC 5301, Management Information Systems 2

UNIT x STUDY GUIDE Title

Organizations must deal with a lot of information about every aspect of the business—from customers to vendors, employees, invoices, payments, inventory, and services. Our information systems make it possible to organize this information and keep up with it all. Business processes deal with the work that is performed in our organizations so that we can produce something of value. The performance of our business depends on how well our business processes work. Our business processes can add extreme value to our organization because they can be a competitive strength. They can also drag our value down if they are not working well for the organization. Thus, IT can work in many ways to improve our business processes by introducing better, faster, and more efficient methods of performing tasks in our business processes. Imagine how much time and money is saved if a thousand invoices are e-mailed to customers rather than being mailed via the postal mail. How much time does it take a person to stuff and stamp 1,000 envelopes? Now, if you look at how technology supports not only business processes but also management groups and functional groups, you can start to see that they link together in a way that serves to improve organizational performance. Value in improved performance. Organizations search every day for ways to improve their performance, production output, and transaction processing. In recent years, technology has advanced to the point that it supports enterprise-level systems, applications, networks, collaboration, and so on. There are even enterprise social networking tools now. Influence of IT on business-level strategy. Basically, a strategy addresses what needs to be accomplished. With any organization, the strategic objectives will be similar. The organizational leaders will want to be number one in their market, increase sales revenue, decrease costs, or strengthen their customer base. It is certainly not a stretch to understand that a business wants to be the best, the fastest, the most profitable, the most efficient, the most customer-friendly, and so on. You must also have a good understanding of what influences organizations. Organizations have a culture. They have politics, social structure, rules, values, norms, and people. The reality is that technology affects all aspects of organizations. For example, information systems can have a huge economic impact on an organization. IT is very costly, but the benefits can influence big increases in revenue or substantial decreases in costs. IT can have cultural and social impacts on organizations as well. A large technology implementation can mean a change in the mindset for many employees who are resistant to change. Imagine that you know technology implementation will increase the efficiency of operations by 50%, but this may also mean that fewer employees will be needed. Imagine that you are one of the employees whose job is at risk due to a new automation. This realization may cause a lot of doubt, uncertainty, and anxiety for employees. All of these factors play an important part in understanding the role that IT plays in organizations. For IT to be beneficial and for organizations to be successful, organizations have to have clear strategies. Organizations have to take full advantage of any competitive advantages and understand models such as Porter’s competitive forces model. Once organizational leaders understand where the business needs to be, they can set clear, actionable steps to get there. Those steps will involve technology because organizations need to have IT resources and IT capabilities. It will also involve an organization’s ability to utilize its IT resources and create value in conjunction with its other assets and resources. Finally, it is important to note that organizations have to be able to align their technologies with their business strategies and goals. It does the organization no good to have a well-defined strategy if it does not have the IT resources and capabilities to meet its goals. On the other hand, if the organization does not have a well- defined strategy that is appropriate for the business, IT tools will be of little help to reach meaningless goals.

Ethical and Social Issues in Information Systems As Laudon and Laudon (2022) note, “ethics refers to the principles of right and wrong that individuals, acting as free moral agents, use to make choices to guide their behavior” (p. 122). The fact is that information systems open the door for many opportunities to make ethical choices—probably as many, if not more, than any other area in business.

ITC 5301, Management Information Systems 3

UNIT x STUDY GUIDE Title

Why is this statement true? Think about it. IT professionals will likely have access to information more than anyone else in the organization. Information such as employee information, customer information, and sales transactions are stored in database tables. A human resources (HR) representative will have access to employee information. A salesperson or customer service representative will have access to sales information or basic customer information. An accounts receivable person will have access to customers’ financial information. Some IT professionals will have access to all information. Additionally, many organizations have personal usage rules regarding the personal use of company website, Internet, and e-mail assets. This usually means that organizations will have applications that log usage into databases. Most of the time, employees’ actual e- mail text is stored as well. Managers can request reports if they feel an employee is abusing the usage rules, but who has access to the data at any given time? Some IT professionals will. Who should have access to this information? Can you imagine what would happen if anyone could access all of this information? Imagine the unethical, disgruntled employee who was passed over for a promotion accessing the web logs and seeing that the newly promoted coworker who is married has been researching dating websites. There is a lot of trust placed in IT professionals to house and manage all kinds of sensitive information and not abuse it themselves. This is where the basics of ethics for IT professionals starts. Even within IT, there are access controls that limit what can be done to the data. In other words, most IT professionals could not delete their web logs. This is all a part of having good security policies, which we will discuss later. Even if you, as an IT professional, accidentally view confidential or sensitive information, you have to know what your ethical responsibility is with regard to that information. Should you inform management that you saw that information? Another example might be knowing the company’s financial information. It is unethical and potentially illegal to use that information for your own financial gain.

Ethical Challenges Let’s examine how technology has advantages and disadvantages by examining the table below from Chapter 4 in your eTextbook. Technology can create new opportunities to enhance people’s lives, but it can also be a detriment to improving lives. Technology, such as the Internet, has challenged our understanding of ethical and privacy issues. Improvements in communications technology, such as high-speed broadband and globalization, have brought the topic of ethics and privacy to the forefront.

ITC 5301, Management Information Systems 4

UNIT x STUDY GUIDE Title

(Laudon & Laudon, 2022)

Data collected by smart cars and smart device tracking features can be used by auto insurance companies to monitor the insured’s driving habits and use the data to justify increasing insurance rates. This software can monitor driver activities such as texting while driving, traveling speeds, alertness, and other driving patterns. This information can then be used by law enforcement against offenders to support traffic violation charges, especially if the driver was involved in an accident. Your individual shopping profile on your favorite online shopping website can be analyzed using advanced data analytics to reveal your shopping habits and associations that are valuable to corporations, government agencies, or other entities that use the data to advertise. Frequent visits to a movie theater could reveal information about your entertainment habits. However, frequent visits to a hospital or care facility would also reveal far more sensitive information about private medical data that you would not want to share with the rest of the world.

Summary This unit covered many of the ethical considerations that you may face at home and in the workplace. In the workplace, there is always more to consider, so most organizations have ethics training for this purpose. At home, individuals will need to be knowledgeable about how information is gathered and to whom that information is given.

Reference Laudon, K. C., & Laudon, J. L. (2022). Management information systems: Managing the digital firm (17th ed.).

Pearson.

ITC 5301, Management Information Systems 5

UNIT x STUDY GUIDE Title

Suggested Unit Resources In order to access the following resources, click the links below. To reinforce the concepts from this unit, you are encouraged to review the following:

• Chapter 3 PowerPoint Presentation (PDF for Chapter 3 PowerPoint presentation)

• Chapter 4 PowerPoint Presentation (PDF for Chapter 4 PowerPoint presentation)

The following article discusses ethical issues in information systems. Mason, R. O. (1986). Four ethical issues of the information age. MIS Quarterly, 10(1), 5–12.

https://libraryresources.columbiasouthern.edu/login?url=https://search.ebscohost.com/login.aspx?dire ct=true&db=bsu&AN=4679471&site=ehost-live&scope=site

The following article examines how organizational value is created through IT governance mechanisms. Wu, S. P.-J., Straub, D. W., & Liang, T.-P. (2015). How information technology governance mechanisms and

strategic alignment influence organizational performance: Insights from a matched survey of business and IT managers. MIS Quarterly, 39(2), 497–519. https://libraryresources.columbiasouthern.edu/login?url=https://search.ebscohost.com/login.aspx?dire ct=true&db=bth&AN=102375761&site=ehost-live&scope=site

The following video cases mentioned in your eTextbook augment the information presented in the assigned chapter readings. You are encouraged to review the Chapter 3 and 4 video cases linked below. A transcript can be accessed for each video within the YouTube player by clicking on the three dots below the video title on the right. Closed-captioning can be turned on by clicking the “cc” icon at the bottom of each video. Akamai Technologies. (2019, October 1). Customer story: Riot games [Video]. YouTube.

https://www.youtube.com/watch?v=REqkqjAc5aA Akamai Technologies. (2019, July 2). Customer story: Roblox [Video]. YouTube.

https://www.youtube.com/watch?v=a2XU_5XdYPo CNET. (2015, February 25). CNET News - What the FCC net neutrality rules will mean for Internet users

[Video]. YouTube. https://www.youtube.com/watch?v=84r3qd19tZU Vox. (2015, February 26). The FCC’s new net neutrality rules, explained in 172 seconds [Video]. YouTube.

https://www.youtube.com/watch?v=sBKPacCuXsw Consumer Reports. (2013, June 6). Setting Facebook privacy controls [Video]. YouTube.

https://www.youtube.com/watch?v=IWlyut4zsko Wall Street Journal. (2012, January 25). Google, privacy and what it means for you [Video]. YouTube.

https://www.youtube.com/watch?v=V7M_FOhXXKM Learning Activities (Nongraded) Nongraded Learning Activities are provided to aid students in their course of study. You do not have to submit them. If you have questions, contact your instructor for further guidance and information. Review the following case study, GE Becomes a Digital Firm: The Emerging Industrial Internet, which discusses the difficulties faced by large, capital-intensive firms in traditional industries becoming digital firms. There is a link within the case study to an accompanying video. (A transcript can be accessed for the video

ITC 5301, Management Information Systems 6

UNIT x STUDY GUIDE Title

within the YouTube player by clicking on the three dots below the video title on the right. Closed-captioning can be turned on by clicking the “cc” icon at the bottom of the video.) After watching the video and reviewing the case study, answer the video case questions at the end.

ITC 5301, Management Information Systems 1

Course Learning Outcomes for Unit II Upon completion of this unit, students should be able to:

3. Explain how information technology systems influence organizational strategies. 3.1 Explain an organization’s ability to use information technology to achieve strategic goals.

4. Evaluate the prevailing ethical issues of information systems.

4.1 Describe how new technology trends may cause ethical dilemmas. Required Unit Resources Chapter 3: Information Systems, Organizations, and Strategy Chapter 4: Ethical and Social Issues in Information Systems Unit Lesson

Information Systems: What This Means to Your Organization For most of us, it is not that difficult to understand certain information technology (IT) concepts. Most of us use our hardware and equipment fairly well. We know how to download apps on our smartphones. We know about the systems and applications that we use at work. We may not know all of the details or inner workings of what information flows where, but we have a good idea of how things work. If we were clueless, we would not be of much value to our organizations, would we?

Organizations and Strategy Let’s take this to a more abstract level. How would you answer this question: How is IT used toward the success of your organization? You might rattle off some reasons relating to the availability of the Internet, which allows e-mails to flow so that there is connectivity between customers and service representatives. You might say that your organization has several servers and databases that house data and a security team with security tools that ensure the safety of the data. You might mention that all the applications allow you to service your customers in faster, more efficient ways. If you are a little more tech savvy at your organization, you might even bring up more advanced topics or newer innovations, such as the ones listed below.

• e-commerce • supply chain management systems (SCM) • customer relation management systems (CRM) • SharePoint • cloud collaboration • enterprise resource planning (ERP) • Systems, Applications, and Products (SAP) • big data • data mining • expert systems

Are the items described here IT tools? Yes, they are used to help make everyone’s lives and jobs easier, faster, more efficient, and more effective, but let’s ask the question again: How is IT used toward the success of your organization?

UNIT II STUDY GUIDE Organizations, Strategy, Ethics, and Social Issues in Information Systems

ITC 5301, Management Information Systems 2

UNIT x STUDY GUIDE Title

Organizations must deal with a lot of information about every aspect of the business—from customers to vendors, employees, invoices, payments, inventory, and services. Our information systems make it possible to organize this information and keep up with it all. Business processes deal with the work that is performed in our organizations so that we can produce something of value. The performance of our business depends on how well our business processes work. Our business processes can add extreme value to our organization because they can be a competitive strength. They can also drag our value down if they are not working well for the organization. Thus, IT can work in many ways to improve our business processes by introducing better, faster, and more efficient methods of performing tasks in our business processes. Imagine how much time and money is saved if a thousand invoices are e-mailed to customers rather than being mailed via the postal mail. How much time does it take a person to stuff and stamp 1,000 envelopes? Now, if you look at how technology supports not only business processes but also management groups and functional groups, you can start to see that they link together in a way that serves to improve organizational performance. Value in improved performance. Organizations search every day for ways to improve their performance, production output, and transaction processing. In recent years, technology has advanced to the point that it supports enterprise-level systems, applications, networks, collaboration, and so on. There are even enterprise social networking tools now. Influence of IT on business-level strategy. Basically, a strategy addresses what needs to be accomplished. With any organization, the strategic objectives will be similar. The organizational leaders will want to be number one in their market, increase sales revenue, decrease costs, or strengthen their customer base. It is certainly not a stretch to understand that a business wants to be the best, the fastest, the most profitable, the most efficient, the most customer-friendly, and so on. You must also have a good understanding of what influences organizations. Organizations have a culture. They have politics, social structure, rules, values, norms, and people. The reality is that technology affects all aspects of organizations. For example, information systems can have a huge economic impact on an organization. IT is very costly, but the benefits can influence big increases in revenue or substantial decreases in costs. IT can have cultural and social impacts on organizations as well. A large technology implementation can mean a change in the mindset for many employees who are resistant to change. Imagine that you know technology implementation will increase the efficiency of operations by 50%, but this may also mean that fewer employees will be needed. Imagine that you are one of the employees whose job is at risk due to a new automation. This realization may cause a lot of doubt, uncertainty, and anxiety for employees. All of these factors play an important part in understanding the role that IT plays in organizations. For IT to be beneficial and for organizations to be successful, organizations have to have clear strategies. Organizations have to take full advantage of any competitive advantages and understand models such as Porter’s competitive forces model. Once organizational leaders understand where the business needs to be, they can set clear, actionable steps to get there. Those steps will involve technology because organizations need to have IT resources and IT capabilities. It will also involve an organization’s ability to utilize its IT resources and create value in conjunction with its other assets and resources. Finally, it is important to note that organizations have to be able to align their technologies with their business strategies and goals. It does the organization no good to have a well-defined strategy if it does not have the IT resources and capabilities to meet its goals. On the other hand, if the organization does not have a well- defined strategy that is appropriate for the business, IT tools will be of little help to reach meaningless goals.

Ethical and Social Issues in Information Systems As Laudon and Laudon (2022) note, “ethics refers to the principles of right and wrong that individuals, acting as free moral agents, use to make choices to guide their behavior” (p. 122). The fact is that information systems open the door for many opportunities to make ethical choices—probably as many, if not more, than any other area in business.

ITC 5301, Management Information Systems 3

UNIT x STUDY GUIDE Title

Why is this statement true? Think about it. IT professionals will likely have access to information more than anyone else in the organization. Information such as employee information, customer information, and sales transactions are stored in database tables. A human resources (HR) representative will have access to employee information. A salesperson or customer service representative will have access to sales information or basic customer information. An accounts receivable person will have access to customers’ financial information. Some IT professionals will have access to all information. Additionally, many organizations have personal usage rules regarding the personal use of company website, Internet, and e-mail assets. This usually means that organizations will have applications that log usage into databases. Most of the time, employees’ actual e- mail text is stored as well. Managers can request reports if they feel an employee is abusing the usage rules, but who has access to the data at any given time? Some IT professionals will. Who should have access to this information? Can you imagine what would happen if anyone could access all of this information? Imagine the unethical, disgruntled employee who was passed over for a promotion accessing the web logs and seeing that the newly promoted coworker who is married has been researching dating websites. There is a lot of trust placed in IT professionals to house and manage all kinds of sensitive information and not abuse it themselves. This is where the basics of ethics for IT professionals starts. Even within IT, there are access controls that limit what can be done to the data. In other words, most IT professionals could not delete their web logs. This is all a part of having good security policies, which we will discuss later. Even if you, as an IT professional, accidentally view confidential or sensitive information, you have to know what your ethical responsibility is with regard to that information. Should you inform management that you saw that information? Another example might be knowing the company’s financial information. It is unethical and potentially illegal to use that information for your own financial gain.

Ethical Challenges Let’s examine how technology has advantages and disadvantages by examining the table below from Chapter 4 in your eTextbook. Technology can create new opportunities to enhance people’s lives, but it can also be a detriment to improving lives. Technology, such as the Internet, has challenged our understanding of ethical and privacy issues. Improvements in communications technology, such as high-speed broadband and globalization, have brought the topic of ethics and privacy to the forefront.

ITC 5301, Management Information Systems 4

UNIT x STUDY GUIDE Title

(Laudon & Laudon, 2022)

Data collected by smart cars and smart device tracking features can be used by auto insurance companies to monitor the insured’s driving habits and use the data to justify increasing insurance rates. This software can monitor driver activities such as texting while driving, traveling speeds, alertness, and other driving patterns. This information can then be used by law enforcement against offenders to support traffic violation charges, especially if the driver was involved in an accident. Your individual shopping profile on your favorite online shopping website can be analyzed using advanced data analytics to reveal your shopping habits and associations that are valuable to corporations, government agencies, or other entities that use the data to advertise. Frequent visits to a movie theater could reveal information about your entertainment habits. However, frequent visits to a hospital or care facility would also reveal far more sensitive information about private medical data that you would not want to share with the rest of the world.

Summary This unit covered many of the ethical considerations that you may face at home and in the workplace. In the workplace, there is always more to consider, so most organizations have ethics training for this purpose. At home, individuals will need to be knowledgeable about how information is gathered and to whom that information is given.

Reference Laudon, K. C., & Laudon, J. L. (2022). Management information systems: Managing the digital firm (17th ed.).

Pearson.

ITC 5301, Management Information Systems 5

UNIT x STUDY GUIDE Title

Suggested Unit Resources In order to access the following resources, click the links below. To reinforce the concepts from this unit, you are encouraged to review the following:

• Chapter 3 PowerPoint Presentation (PDF for Chapter 3 PowerPoint presentation)

• Chapter 4 PowerPoint Presentation (PDF for Chapter 4 PowerPoint presentation)

The following article discusses ethical issues in information systems. Mason, R. O. (1986). Four ethical issues of the information age. MIS Quarterly, 10(1), 5–12.

https://libraryresources.columbiasouthern.edu/login?url=https://search.ebscohost.com/login.aspx?dire ct=true&db=bsu&AN=4679471&site=ehost-live&scope=site

The following article examines how organizational value is created through IT governance mechanisms. Wu, S. P.-J., Straub, D. W., & Liang, T.-P. (2015). How information technology governance mechanisms and

strategic alignment influence organizational performance: Insights from a matched survey of business and IT managers. MIS Quarterly, 39(2), 497–519. https://libraryresources.columbiasouthern.edu/login?url=https://search.ebscohost.com/login.aspx?dire ct=true&db=bth&AN=102375761&site=ehost-live&scope=site

The following video cases mentioned in your eTextbook augment the information presented in the assigned chapter readings. You are encouraged to review the Chapter 3 and 4 video cases linked below. A transcript can be accessed for each video within the YouTube player by clicking on the three dots below the video title on the right. Closed-captioning can be turned on by clicking the “cc” icon at the bottom of each video. Akamai Technologies. (2019, October 1). Customer story: Riot games [Video]. YouTube.

https://www.youtube.com/watch?v=REqkqjAc5aA Akamai Technologies. (2019, July 2). Customer story: Roblox [Video]. YouTube.

https://www.youtube.com/watch?v=a2XU_5XdYPo CNET. (2015, February 25). CNET News - What the FCC net neutrality rules will mean for Internet users

[Video]. YouTube. https://www.youtube.com/watch?v=84r3qd19tZU Vox. (2015, February 26). The FCC’s new net neutrality rules, explained in 172 seconds [Video]. YouTube.

https://www.youtube.com/watch?v=sBKPacCuXsw Consumer Reports. (2013, June 6). Setting Facebook privacy controls [Video]. YouTube.

https://www.youtube.com/watch?v=IWlyut4zsko Wall Street Journal. (2012, January 25). Google, privacy and what it means for you [Video]. YouTube.

https://www.youtube.com/watch?v=V7M_FOhXXKM Learning Activities (Nongraded) Nongraded Learning Activities are provided to aid students in their course of study. You do not have to submit them. If you have questions, contact your instructor for further guidance and information. Review the following case study, GE Becomes a Digital Firm: The Emerging Industrial Internet, which discusses the difficulties faced by large, capital-intensive firms in traditional industries becoming digital firms. There is a link within the case study to an accompanying video. (A transcript can be accessed for the video

ITC 5301, Management Information Systems 6

UNIT x STUDY GUIDE Title

within the YouTube player by clicking on the three dots below the video title on the right. Closed-captioning can be turned on by clicking the “cc” icon at the bottom of the video.) After watching the video and reviewing the case study, answer the video case questions at the end.