Management of Information System and Firm Culture

Introduction 

Management of information systems (MIS) has a considerable influence on management functions, culture and structure of an organization. Information systems are introduced by managers to address the interests of the firm. Hence, organizations must portray awareness of MIS and develop an open mind towards its influences to achieve positive outcomes (Romi, 2011). The relationship between organizations and MIS is undoubtedly complex owing to the influence of factors such as organization structure and culture, organization politics, business processes, and management decisions (Karim, 2011). Managers ought to decide how information systems should be built, what needs to be done and how they can be implemented to give the firm a competitive advantage. 

While the changes associated with information systems cannot be foreseen, managers may be unable to meet their expectations. MIS demands new work patterns, the structure of teams and managerial roles. It can influence the centralization or the decentralization of control and decision making systems. Information systems are unavoidably bound by organization politics as they influence the most important resource, information (Chi & Sun, 2015). MIS, therefore, requires changes in individual routines, which can be a challenge for those who require retraining and additional effort that is unlikely to be compensated. Since MIS changes almost every aspect of the firm from the culture, structure, strategy and business process, considerable resistance could occur upon introduction. MIS has a considerable impact on the organizational culture of a firm and creates a competitive advantage. 

Organization Politics and Culture 

Organization politics influence the decision-making process of the management. People in organizations have different competencies and skills with unique concerns, perspectives, and specialties. Hence, they have divergent perspectives regarding how rewards, punishments, and resources should be allocated or distributed. These disparities are essential to managers and employees because they imply the political struggle for competition and resources thus a source of conflict in most organizations. While MIS introduces organizational change, political resistance is among the challenges that impede the development of new information systems (Laudon and Laudon, 2018). Managers who acknowledge the politics of an organization are more likely to succeed than managers who implement unfamiliar information systems. Business processes define how firms produce value and are usually associated with an organization’s culture. Organizational culture is an influential element that restricts political conflict in organizations and enhances a common understanding among managers. Having a basic cultural agreement in an organization implies the ease of agreeing on other concerns. However, organizational culture impedes to change, especially that associated with MIS. Notably, any change that appears to threaten the cultural assumptions of an organization is likely to encounter a great deal of resistance. 

Organization Structure 

Communication has in modern age been restricted to computer systems to facilitate the ease and convenience of conveying information. Changes introduced by MIS means employees will focus more on individual work, personal stations of work and interact more with machines rather than other people (Luvison & de Man, 2015) . There will also be changes in the hierarchical structure of the responsibilities and duties of the management. Decision support systems (DSS) and computer-based information are elements of MIS which offer increased dimensions of structural design. This influences choices such as individual responsibility and tasks along with the division of labor. MIS systems allow firms to track changes in customer choices more effectively and rapidly. These advances enable firms to improve communications and operating efficiencies, increase global presence, gain competitive advantage and reduce costs. Recent trends in managing a workforce require implementation of information systems at all organization levels. These changes in organizational culture will reduce process time since MIS allows firms to redesign their structure and adopt a flatten structure. This structure is characterized by open communication channels, decentralization of authority, smooth flow of information and flexibility (Romi, 2011). The employees get more control over their duties with less supervision because MIS encourages free decision-making process based on an individual’s expertise. 

Large and bureaucratic organizations existed before the computer age. These organizations were considered slow to change, less competitive and inefficient compared to those that have been newly created (Chi et al., 2015). Notably, some of these organizations have undergone downsizing hence reducing the number of employees and the organizational hierarchies. According to behavioral researchers, information systems enhance the flattening of hierarchies through widening the distribution of information, increasing management efficiency and empowering employees in low-level management. Information systems give employees in lower managerial levels the right to make decisions in the organizations since they access the information they require for those decisions without any supervision. The empowerment is also meaningful as it enables highly qualified employees to make intelligent decisions. Since MIS enables managers to access accurate and reliable information on time, they have become faster in making decisions hence the need for fewer managers (Romi, 2011). Managerial costs decline due to the implementation of MIS, which enables organizational hierarchies to be more efficient. As a result of these changes in organizational culture and structure, the management’s span of control is broadened to enable high-level managers to control and manage more employees. 

Organization Change 

Organizations must not underestimate the social and psychological implications associated with technological change. These changes comprise of increased automation and information technology. They should not be considered as a threat by staff members but rather innovations and ideas. Managers must strive to leverage the need for adaptability in introducing opportunities brought forth by new technology. They can achieve this by expressing concern in the interests of the employees (Guynes & Nyaboga, 2010) . Notably, the managerial strategy in introducing technical change to the organization influences the attitude of people towards work, individual behavior, and level of performance. Continued technical change is unavoidable and can develop at a greater rate hence the need for managers to be responsive to information systems. MIS creates a demanding challenge in organizations as it emphasizes the relationship between the subsystems of a firm (Karim, 2011). The management and implementation of information systems should be related to its impact on the structure, people and the task. Therefore, managers must strive to avert destructive conflict, isolate staff and managerial colleagues or to evoke the anger of trade unions. They should also avoid increased costs or low performance emanating from delays in the implementation of information systems. Managers must, therefore, consider the impact of technical change on the behavior and attitude of the staff. 

The use of information systems has improved at an exceptional rate in organizations. As a result, organizations still experience changes arising from technology, which has diversified organizational processes, nature of work and tasks. Usually, changes driven by technology have increased the use of personal computers as a job component. This combination of technology has had a remarkable effect on the changing job requirements, interactions with co-workers and employee morale. Notably, job satisfaction is an attitude related to work although managers lack adequate knowledge about the related antecedents. Organizational change has a noticeable impact on job satisfaction as it associated with organization behaviors that are beneficial to organizational value (Chi et al., 2015). Besides job satisfaction, managers can ensure organizational commitment by adopting MIS. In so doing, employees will develop a psychological connection to a firm and reduce any possibility of resistance towards change. Moreover, employees with high levels of commitment tend to remain and retain their positions owing to a lack of alternatives or due to social pressure. 

Information System Strategies 

Information systems are closely connected with organization culture and introduce competitive strategies that firms can explore. These are low-cost leadership, product differentiation, market niche and strengthen suppliers and customers (Bobb & Harris, 2011) . First, low-cost leadership encompasses low operation costs and low prices. MIS enhances the improvement of inventory management and supply management besides creating an efficient response system for customers. Secondly, product differentiation entails enabling new services and products or changing the customer. This strategy fosters convenience in the use of existing products and services. MIS enables firms to create services and products that are personalized and customized to satisfy the requirements of individual customers. Thirdly, focusing on market niche enables a particular market to focus on a narrow target market, unlike the competitors. Managers can use information systems in the production and analysis of data to improve marketing techniques and sales. This entails analyzing the tastes, preferences and buying patterns of customers to enhance advertising and marketing campaigns to small target markets. Lastly, strengthening customers and suppliers implies tightening connections with suppliers and developing intimacy with customers. Managers use MIS to promote direct access to information from suppliers in a firm and increases loyalty and switching costs to the company. 

Value Chain 

Information systems are vital in each stage of the value chain. They enhance operational efficiency, improve profit margins, lower costs and establish close relationships with suppliers and customers (Romi, 2011). Organizations adopt MIS to help with assessing how activities that add value are conducted at each phase of the value chain. Information systems improve relationships between customers and the organization by establishing customer relationship management systems (CRM). The relationship between suppliers and a firm is also established through supply chain management systems (SCM) although suppliers are outside the value chain but still, belong to an extensive value chain. Information systems are crucial in allowing firms to track benchmarks and recognize best practices in their industries. Strategic information systems also influence business processes, organization culture, and structure (Laudon et al., 2018). New systems cause disruptions on established work patterns and authority relationships hence the possibility of considerable resistance when they are initiated. The implementation of strategic systems requires widespread organizational change and a shift from one socio-technical level to another. These changes are strategic and are challenging to achieve despite that not all are profitable. Strategic information systems are complex and expensive to build since they comprise of massive changes in the social and technical perspective of the organization (Guynes et al., 2010). Another challenge is the ease of imitating strategic information systems; hence the strategic advantage is unsustainable. Managers must carefully address and acknowledge the complex relationship between organizational performance, decision making, and information systems. 

MIS is a significant force of modernization that allows firms to implement shared information delivery as business functionality. Information systems entail communication and computer technologies as infrastructure that underpins the competitive position of firms. New technology ensures greater speed, greater volumes, and few resources. MIS has generated new opportunities that eliminate administrative overhead and convert the HR department into a strategic associate (Karim, 2011). This addresses challenges that vary from maintenance and cost along with the effective use of computers and software. Firms affirm the increasing importance of people in an organization. However, the actions and decisions of each person have a significant impact on the performance of the organization. In the digital information age, speed is a major aspect of competition and decisions must be made instantly and not subjected to a bureaucratic management hierarchy (Luvison et al., 2015). Notably, a wrong decision by a computer programmer can cause severe implications to the organization. The digital aspect of information systems increases the need for information security procedures, workforce motivation, and management of budgetary costs in an ever-changing marketplace (Bobb et al., 2011). MIS allows managers to stay competitive in a technology-driven and ever-changing business environment by emphasizing a link between information systems and the firm’s overall strategy. 

Competitive Advantage 

MIS creates a competitive advantage for organizations by processing the data that is collected from information systems. These information systems connect organizations to supply chains, distribution channels, and customers. MIS creates a platform for organizations to scrutinize, plan and improve performance or relationship between customers (Berisha-Shaqiri, 2015 ). The cost of implementing MIS has reduced significantly over time hence the challenge of maintaining a high market share and having a favorable position of the business in a competitive market. An increase in the speed of collecting data and processing it enhances the effectiveness of MIS in providing the necessary reports that facilitate strict scrutiny of organization performance. Managers need to align MIS to organizational goals to obtain the whole benefits of the system. The available information and its effectiveness dictate the basic importance of an information system. Effective information allows managers to accomplish specific goals or activities. Despite that this information is considered as a product, the affordable process of acquiring and using it to achieve specific goals depicts its efficiency to firm managers. 

MIS also provides managers with quality information that is both complete and accurate. This is considered as information integrity, which ensures information is essential in making a difference when making decisions. These decisions reduce uncertainty and increase knowledge regarding products and services. Information is beneficial to the organization when it corresponds to objectivity, reputation, and believability for the intended purpose. Information can be reliable if it is credible and true. Notably, most organization rivals rely on information to gain a competitive advantage by appreciating the need for direct involvement in the digital era (Bobb et al., 2011). Information technology extends beyond computers as it entails information that is developed and used by a firm to gain a competitive advantage. Information influences competition by altering the structure of the industry. Hence, companies gain new ways of outperforming their competitors and generating new business that varies from usual business operations. 

Employee Resistance 

Managers are facing employee resistance in their attempt to introduce technological changes. Firms should define the meaning of employee resistance to improve how change can be handled. Employees are familiar with a particular culture of performing their tasks in the organization. Any change without prior notice is likely to trigger resistance and managers need to invest more in preparing employees for change through training programs. Employees resist change not due to their disagreement with change but because of a lack of knowledge about the expectations (Xiao, 2017). Managers can successfully implement MIS in the organization through effective communication with employees about information systems and their impact on performance. Employees who are prepared to learn something new but fear to adapt it can resist the change. Thus, managers ought to streamline communication channels with employees to prevent any misunderstanding or confusion. Notably, it is easier to implement change that employees consider positive. Employees often encounter changes in their duties or functions since planning and implementation were done solely by managers. Therefore, employee involvement in the implementation of MIS in a firm will have a positive impact on organizational culture. These employees are likely to portray commitment towards making decisions that increase firm performance (Romi, 2011). Employees who are supportive to change tend to use the new technology for the benefit of the organization instead of resisting it. Also, employee participation in decision making that is related to introducing changes motivates them to ensure it is effective and beneficial for the firm. 

Porter’s Model 

Porter’s competitive forces model is a widely used model to understand a firm’s competitive advantage (Dobbs, 2014). It provides an overview of the firm, its environment, and its competitors. All firms share market space with competitors who continually develop new and efficient ways to produce. Competitors introduce new products and attempt to attract customers through developing brands and inflicting switching costs on customers. Porter’s model entails examining the general business environment and comprises of four factors. First, new market entrants imply that new companies are entering the marketplace in a free economy with financial resources and mobile labor. Some industries have low entry barriers while others have high entry barriers. For example, it is easy to set up a small business but more expensive and difficult to begin computer chip business that requires more capital and significant expertise. New firms have multiple advantages one of which is they hire young workers with fewer expenses and more innovative. The firms are highly motivated rather than conservative like those that already exist. However, new entrants rely on outside financing to develop new plants and equipment. This is expensive, and the workforce is less experienced with limited brand knowledge. 

Secondly, substitute products and services entail substitutes that customers may use in the event prices are high (Dobbs, 2014). New technologies generate new substitutes and the more substitute products in an industry means less control on the pricing and low-profit margins. Thirdly, customers can be attracted and retained by profitable companies even when charging high prices than rivals. Customer power improves due to the ability to switch to competitor products and services. Customers can also influence business and its rivals to compete based on price in a transparent marketplace with limited product differentiation. Lastly, supplier power in the market has a significant effect on the profitability of a firm (Dobbs, 2014). This is possible when a firm cannot increase prices as fast as suppliers do. Firms with more different suppliers tend to have more control to exercise over suppliers with regards to the price, delivery schedules, and quality. For example, manufacturers of personal computers (PCs) have multiple suppliers who compete for similar components such as hard drives, display screens, and keyboards. 

Synergy and Core Competence 

Information systems enhance a firm’s ability to achieve a strategic advantage by collaborating with other firms to improve industry standards. These standards help with the exchange of business transactions or information in an electronic platform. This compels market participants to pursue similar standards to increase efficiency and make product substitution less likely. MIS makes it possible for firms to develop value chains that are highly synchronized in the industry called value webs (Luvison et al., 2015). This is a collection of independent firms that utilize information systems to organize their value chains to yield a service or product for the market. It focuses more on the customer and operates less linearly compared to a traditional value chain. Large corporations are a typical collection of businesses and MIS can improve the performance of the business units through promoting core competencies and synergies. 

Firms comprise of many business units, and information systems help to attain efficiency by combining operations of dissimilar business units. MIS gives businesses the opportunity to balance their core competencies by enhancing knowledge sharing across business units (Chi et al., 2015). MIS creates business models that depend on a large user network or subscribers. Business ecosystems entail different industries that work together to offer value to customers. Thus, MIS support a wide network of interactions that entail participating firms. Synergies allow firms to used outputs of some units as units for other units. It also entails two organizations that pool expertise and markets, whose relationships generate profits and lower costs.MIS is useful in synergy situations as it combines operations of dissimilar business units to act as a whole. Information systems enable merged firms to consolidate operations, increase cross-marketing and reduce retailing costs of financial products. 

Conclusion 

Modern organizations are specialized, impartial and hierarchal. They have adopted explicit routines that increase efficiency. Organizations have cultures and politics that emanate from dissimilarities in interest groups. These cultures are also affected by the immediate environment. Organizations have different goals, social roles, leadership styles, tasks, type of structure and incentives. These features have an impact on the implementation of information systems by managers in organizations. They also explain the variations in the use of information systems by organizations. Organizations use information systems to interact and influence business operations. The introduction of MIS in a firm is likely to affect organizational goals, structure, work design, decision making, competition, employee behavior, and values. Information systems should, therefore, be designed to address the needs of essential organizational groups and will be developed by the organization’s business processes, politics, culture, management, and goals. Information technology reduces agency and transaction costs as changes that are highlighted using the internet by organizations. New systems cause disruptions of established patterns of power and work relationships hence the considerable resistance when they are introduced to organizations. 

References 

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