Management Information Systems: The Technology Challenge

Nigel F. Piercy

• Publisher: Taylor & Francis
• Year: 2018
• eBook ISBN: 9781351131858
• Edition: 1
• Topic: Economics
• Subtopic: Business General
• Index: Economics

This book, originally published in 1984, established the need for a strategic managerial response to the new technology, which relies on an understanding of the real effects of technology - on organisational structure, manageemnt style and employee relations. It assesses the impact of the new information technology on manufacturing systems, employment levels and types, industrial relations and finally on marketing and external relationships.

1.      Technology and Information

by Nigel Piercy

It is relatively clear that at the present time there are widely diverging opinions on the real impact of new information technology (NIT) on and in business organisations. At the one extreme there are those who focus on the technical potential of NIT in its many operational applications in the factory and in administrative systems. At the other extreme there are those of us (e.g. Burges and Piercy, 1985; Piercy and Burges, 1986) who have expressed reservations about the extent to which such a technical potential can sensibly be realised in the practical content of business organisations – and indeed have been pilloried by technological enthusiasts for such ‘Luddism’. In spite of the protests, however, in this writer’s view there remains an enormous gulf between the technological potential offered by engineers and systems specialists, and the technological reality experienced and coped with by managers. There seems considerable value in focusing on the nature of that gulf.

This volume, in common with the others in the Series, is really concerned with three significant managerial issues. The first is, indeed, to make explicit the frequently obscured potential of NIT in business. While many works have emphasised the overt technical applications in automating factory operations, in replacing and supplementing human efforts in the office, and in up-grading business information systems, rather less attention has been given to the impact on inter-organisational relationships, competitive structures, the fundamental nature of organisations and the employment they offer, and other pervasive issues of strategic importance. While these latter issues are pervasive, they are also frequently covert – at least initially, and their significance is underestimated in practice.

The second goal is thus to make explicit the NIT issues facing strategic management. The urgency of this function is illustrated by recent evidence that firms, in the UK at least, are largely ignoring any effect of NIT other than the operational. For example, a 1984 PA Technology study found that 45% of companies reported that new technology had made little or no impact on their activities in the previous five years and 39% had no defined strategy for innovation or the application of NIT in the following five years (Pattie, 1986).

The third goal of these works is also focused on the gulf between technological potentials and realities and is concerned with the constraints which exist in the implementation of NIT, and the managerial policies which are demanded to cope with them.

In the context of this general brief, this present book has attempted to analyse one of the more obvious and immediate impacts of NIT – that on the management information system (MIS).

An initial problem in this task was that there is no universally accepted understanding of what is meant by the MIS. Approaches taken here represent views of the MIS varying from the MIS as all forms of information, to the MIS as specific, normally financial, control systems for top management. No attempt is made here to resolve this dilemma, and each of the chapters must be taken in the context of its author’s concept of the MIS.

While the contributions to the book are diverse in their approaches to considering the impact of NIT on MIS, they have been grouped into three broad categories: those concerned with the social and organisational impact of NIT; those focusing on the potential impact of NIT in different business contexts; those providing insights into the NIT impact in practice; and finally those where the concern is not with the operational impacts of NIT, but the broader strategic implications of the NIT/MIS interface.

The Social and Organisational Impact of New Technology

In this area the point of departure was the more general study of the managerial and organisational implications of new information technology (Piercy, 1984), leading to four very different approaches.

First, Frank Land provides the viewpoint of the systems analyst or manager, which starts with the organisation’s information requirements and the complex issue of how information is used by managers together with the ‘social policy’ aspects of NIT in the MIS, to identify essential preconditions for the implementation of technology-based information systems and the need to consider not merely systems design but social design and user participation in design processes. With this complex foundation established, Land turns to consider the tools and techniques which are available to support his approach to systems design.

A somewhat different perspective is adopted by Roger Mansfield in his chapter. Rather than the problems of design and implementation of NIT in MIS, Mansfield is concerned with the impact of the NIT-driven MIS on the general management task, and particularly the changing nature of the information available for decision making and control. Mansfield’s conclusion is that the major impact of the NIT innovation is to revolutionise the tasks of strategic management and to more this key organisational role steadily towards the automation of many policy decisions. This question is taken further in the concluding part of the book.

Finally in this section, Annette Davies focuses on the behavioural and organisational reactions to systems change, and the link between systems design and work design leading to support for the notion of participative systems design introduced earlier by Land. She concludes that the design and implementation of sophisticated information systems is not simply a technological problem, but is an organisational and political issue.

The major theme emerging from this section is that although the impact of NIT may be approached from different disciplines and viewpoints, there is convergence on the critical human issue as the key to implementing NIT in an effective way. This is demonstrated in the context of technical systems design, the definition of the top management function, and in work design lower in the organisation.

NIT Applications in Theory

Attention turns next to the application of NIT to the MIS in a number of specialised areas: in small business, in management accounting and in marketing.

First, Roger Groves examines the adoption of new technology-based budgetary systems in small companies, outlining the diffusion of NIT in this sector and the potential applications, but stressing the behavioural and organisational changes implicit in this diffusion, and the particular importance of change agents. He concludes that the critical underlying success factor is improved understanding of the changes in systems and for personnel which are required by NIT.

Secondly in this part of the book, Christopher Cowton reviews the impact of NIT on management accounting, emphasising the opportunities offered, in terms of the application of techniques, and then focusing on the implied change in the organisational relationship between management accountants and other information specialists. He identifies a particular threat to the traditional management accounting role from the manager himself acting as information processor, using NIT, suggesting the need for a more responsive advisory role to be adopted by the management accountant.

The remaining chapters in this section both deal with the impact of NIT on marketing. Deborah Martell reviews what is known about the impact of NIT on internal and external information functions in marketing. Barrett, on the other hand, is concerned with the potential for upgrading the organisation’s marketing accounting system. Although such advances are not necessarily based in the concept of NIT/ they are unlikely to be implemented in the absence of technological capacity. For this reason Barrett’s chapter is included as a demonstration of one direction in which the technology may allow the marketing information system to develop. Specifically, Barrett is concerned with the evaluation of marketing activities in financial terms, and the design of systems which match the organisation’s environment, its marketing strategy, and the organisation structure of the marketing department.

NIT Applications in Practice

This part of the book turns to the somewhat limited available evidence about the implementation of NIT in the business context.

First, Stephen Hill discusses the results of a survey of engineering firms, focusing on the underlying reasons for the lack of acceptance of advanced information systems in business.

Secondly, Richard Ingram provides a detailed account of the development of NIT-based MIS in the UK motor industry, drawing on his extensive practical experience in that field. His account concerns itself firstly with MIS in production control in the context of computer integrated manufacturing at Jaguar Cars, and then with MIS and office automation at Austin-Rover.

Ingram’s chapter is rooted in practical experience rather than academic research and offers many novel and compelling insights into the practical use of NIT.

Indeed, perhaps the major theme of this section of the book is to offer some illumination of the void which remains between the potential of NIT and experience of the reality of its implementation. This provides a salutary note of caution for these of us who are optimistic about the progress of the technology, as well as suggesting a number of important areas which are likely to be susceptible to empirical research.

The Strategic Implications of NIT

Finally we turn to an examination of the strategic implications of NIT in the MIS context, from three leading international authorities in the field – William R. King of the University of Pittsburgh, William E. Halal of the George Washington University, and Michael Earl of Templeton College, Oxford.

The present writer has argued (Piercy 1984, 1985) that it is the strategic implications of NIT which are the most underrated and ignored by managers, and the three chapters in this part of the book provide both illumination and guidance in just this area.

First, William King focuses on the issue of the development of strategic business advantage from NIT. He argues and illustrates the case that the role of information in business has dramatically changed, leading to the notion of information-based comparative advantage in developing business strategy. He then provides us with a conceptual framework for operationalishig this concept of information as a strategic resource.

This chapter poses a challenge to managers and analysts to identify and exploit the changing role of information in their businesses, in an original and insightful way.

Secondly, William Halal turns to the question of organisational networks as overturning many of the prevailing assumptions regarding organisational structure and institutional relationships. He illustrates the intellec tual disruption provided by NIT and the complexity created, which leads, he suggests, to ‘confederations of entrepreneurs’ in a nuilti-dimensional matrix and eventually a decentralised network rather than a traditional hierarchical form. His optimism about this type of change is encapsulated in his description of an ‘entrepreneurial boom’ and the role of the ‘intrapreneur’ in the organisation. Halal provides a perspective too on interorganisational networks and the ‘global suprasystem’ leading to the ‘flowering of enterprise’.

Halal’s contribution is both challenging and original and serves to lead us away from the concept of NIT as simply computerising the MIS towards the impact on the nature of organisation and their relationships and the roles that people play in them.

With this foundation describing the impact of NIT on business strategy and the strategic business unit, we turn” finally to Michael Earl’s chapter to focus our attention on the critical process of actually formulating information technology strategies.

Earl seeks to provide us with a framework which captures awareness, opportunity and positioning with regard to NIT, as a vehicle for the identification of NIT strategies, through multiple methodologies.

It is to be hoped that this chapter closes the loop in a particularly exciting way – we started with the proposition that there was a gap in strategic thinking relating to NIT, we then delineated why that gap was of growing importance, and finally we demonstrated the strategic nature of that gap. Earl’s contribution provides us with practical and intellectual guidance in what to do about this gap.

In total, with the reservations expressed earlier, this book is presented as a novel approach to one of the most critical issues facing management in the remaining years of this century.

REFERENCES

Burges, S. and Piercy, N. (1985) ‘Question of Hit or a Myth’, Times Higher Education Supplement, 20 September, 16

Pattie, G. (1986) ‘Can-Do V. the Timid Lions’, Sunday Times, 2 March, 18

Piercy, N. (1984) The Management Implications of New Information Technology, Croom Helm/NicholS, Beckenham

Piercy, N. (1985) ‘How to Manage IT’, Management Today, March, 72–5

Piercy, N. and Burges, S. (1986) Processors’, Director, forthcoming

I       THE SOCIAL AND ORGANISATIONAL IMPACT OF NEW TECHNOLOGY

2. Social Aspects of Information Systems

by Frank Land

INTRODUCTION

All organisations need information systems in order to function effectively. Every information system, whether for a one-man business, a parish council, a multinational corporation or the government offices of a large industrial nation, is made up of a number of components. Some of the components are artefacts – pencils and paper, word processors, computers and communication networks, operating systems and procedure manuals, but all information systems require people to construct, to work and to operate the artefacts. Even a completely automated information system still requires people, and in practice, information systems rely on people using and interacting with the artefacts.

Information systems vary enormously in the extent to which they rely on formal standardised and structured information-handling techniques as against informal, and often ad hoc and subjective techniques. All information systems utilise some elements of both. A model of an information system (Figure 2.1) illustrates the relationship between the different components of an information system and shows the formal and informal aspects. The information system exists in a real world which consists of objects (some concrete, such as machines, stock and buildings; some abstract, such as budgets, accounts and sales forecasts). The system uses people (customers, suppliers, mana...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• List of Figures
• List of Tables
• Preface
• 1. Technology and Information
• Part I The Social and Organisational Impact of New Technology
• 2. Social Aspects of Information Systems
• 3. Planning, Control and Technological Change
• 4. Organisational Aspects of Management Information Systems Change
• Part II Applications in Theory
• 5. The Adoption of Microcomputer-Based Budgetary Systems in Small Companies: Organisational and Behavioural Considerations
• 6. Management Accounting and New Information Technology
• 7. Issues in the Design of Marketing Accounting Systems
• 8. Marketing Information and New Technology
• Part III Applications in Practice
• 9. Management Information Systems: Some Reflections and Evidence
• 10. Recent Developments in Management Information Systems in the UK Motor Industry
• Part IV Strategic Implications
• 11. Developing Strategic Business Advantage from Informational Technology
• 12. Organisational Networks: The Structural Imperative of the Information Age
• 13. Formulating Information Technology Strategies
• Author Index
• Subject Index