Managing the Digital Firm - Essay Example

Mnging the Digitl Firm [Nme of the School] [Nme of the Introduction century go compnies begn to increse in size. Mny of them becme lrge, complex, nd bureucrtic, often employing thousnds of workers. Wheres workers hd once toiled longside boss who prticipted in nd directed their efforts, the dvent of lrge compnies--especilly investor-owned corportions--required tht employees' work be supervised to bring success to their employer if not to they. Whether by rt or science, mngers in lrge businesses were required to pln nd coordinte these opertions. s is true of ll instnces when humns bnd together to mplify their individul efforts, communiction ws instrumentl in the endevor of mngers to direct ctivities needed to crete, produce, nd sell products or to provide services. Due to nturl increse of the orgniztionl size, the need of utomted systems ppered for the effective nd timely mngement of people nd resources. The Informtion System (IS) is wht the compnies now use to rech the objectives of effective processes through mnging the systems, people, dt records nd ctivities tht process the dt nd informtion (Robson 2005). In the following pper I will reserch IS nd its effect on orgniztions. In order to prove the efficiency of IS on prctice, I will present n IS use in the life of humn resource deprtment of n orgniztion. The effects of IS on orgniztion Technologicl dvnces in the form of IS hve chnged the vilbility of informtion nd the nture of communiction within contemporry orgniztions. Compred to more trditionl mens, electronic communiction nd informtion technologies cn crry more informtion fster, t lower cost, nd to more people while lso offering incresed dt communlity, processing, nd powerful recombinnt cpbilities (Fulk, Boyd, 1991). dvnced communiction nd informtion technologies extend the number nd vriety of people involved in orgniztionl decisions, diminish temporl nd physicl interction constrints, nd increse horizontl nd verticl communiction. Moreover, the use of dvnced communiction nd informtion technologies in orgniztions is widespred nd commonplce. Decresing technology costs nd, often, criticl mss of users hve fcilitted substntil use of electronic mil (lbrecht, 1984), corporte Intrnets, Web pges, videoconferencing, nd group support systems. In light of reserch indicting tht individuls often perceive tht informtion is difficult to ccess during periods of orgniztionl sociliztion, the benefits of communiction technologies reltive to informtion dissemintion hve importnt implictions for sociliztion. Effective informtion mngement n importnt prt of effective informtion mngement requires the good development of retrievl systems within the compny's informtion technologies. The necessrily of well-set system of retrievl function is cused by the importnce of designing one computer system tht would gther ll informtion nd the reserch process would significntly ese the process of finding the required informtion. Idelly, the system should be ble to serch huge dtbses of text rpidly, nd be ble to differentite between documents tht seem more relevnt to the user's problem nd those tht seem less so. It should hve some informtion or "knowledge" bout the problem being reserched, bout the domin generlly, nd bout the context of the serch -- for exmple, wht the user hs previously considered relevnt, wht hs lredy been found, nd so on. Finlly, it should be designed in such wy tht it fcilittes the originl reserch tsk. Ech of these three gols is mjor reserch problem in its own right, drwing on the techniques nd tools of three different subfields of computer science nd cognitive science: informtion retrievl (IR), rtificil intelligence (I), nd humn-computer interction (HCI). In frmes of my pper ssignment tht implies writing bout effective informtion systems I will explore the nture of IR which ims to find documents relevnt to user's serch request, documents tht re sid to stisfy the user's "informtion need." In order to rech the min purpose of IR it is required to perform some sort of mtching opertion between the request nd the documents in the corpus, nd (preferbly) ordering the responses from most to lest relevnt. The most obvious wy to do this is simply to serch through every document looking for words included in the request, but there re fr more efficient nd effective techniques tht hve emerged from the pst thirty yers of IR reserch. The tsk of n informtion retrievl system is simple: to retrieve documents tht stisfy user's informtion need. The simplicity of the tsk is deceptive, however, becuse ech spect of it rises mny questions. Wht is "Document" In IR, this my not be the typicl book or journl rticle, but rther ny contiguous collection of free text exmple, prgrphs, electronic mil messges, or (s in SCLIR) court decisions. Wht Constitutes "Retrievl" In some IR systems (such s Dow Jones News Service), the full text of the document itself is retrieved. In other systems, only surrogte of the document is retrieved. This might simply be librry ctlog number, or it might contin more informtion such s n bstrct. In either cse, user must then physiclly retrieve the item by (for instnce) going to the librry. Who is " User" In some cses, the typicl user of the system will be the one who ultimtely needs the informtion. In other cses, skilled intermediry (such s reference librrin) does the ctul intercting with the IR system, nd then relys the informtion to the end-user. Usully these intermediries re fr more skilled t using the IR system thn the end-user, but they my be less knowledgeble bout the domin of the document corpus. Wht is User's "Informtion Need" simple view is tht the informtion need is just wht is described in the user's request for informtion or query. Typicl queries re expressed in some rtificil syntx, but some systems llow nturl lnguge requests. more complex view of informtion need holds tht becuse the user doesn't yet know the nswer to the problem tht motivted the serch, he or she cnnot directly express the need s query. In prt, which view one dopts depends on whether "the tsk t hnd" is believed to be using the IR system to serch for documents, or "retrieving informtion" in the generl sense. Wht Does it Men to "Stisfy" this Need This is perhps the most difficult nd hotly debted question. If we view queries s roughly the expression of n informtion need, then stisfying the need is most commonly described by notion of relevnce. We cn rgue bout the effectiveness of n IR system nd the relevnce of its responses, but this question does not even mke sense for DBMS; it either gives the correct nswer or hs bug in the progrm. Mny uthors hve commented on the different nture of the IR nd DBMS tsks; see, for exmple, In short, the structure of mny informtion systems functions ppers to be unstble. Here re so mny fctors nd tensions which lie behind the question wht is the pproprite orgniztion for IS--nd these chnge quite quickly over time nd vry cross enterprises. For exmple technologicl chnge nd doption, strtegic importnce of IT, host orgniztion structure, nd the current stte of orgniztionl reltionships ll influence wht is pproprite t ny time. Thus it my be helpful not to think of orgniztionl structure for IS, but the orgniztionl rrngement, which implies tht n rrngement hs to be worked out for ll the different informtion technologies to fit the stte of these influentil fctors t ny time. The 'rrngement' my comprise quite mix of reltionships nd structures nd be continuously evolving. Humn Resource Informtion System Humn Resource Informtion System is systemtic procedure for collecting, storing, mintining, retrieving, nd vlidting dt needed by n orgniztion bout its humn resources, personnel ctivities, nd orgniztion unit chrcteristics (Wlker 1992). n HRIS need not be complex or even computerized. HRIS cn be s informl s the pyroll records nd time crds of smll business, or s extensive nd forml s the computerized humn resource dtbses of mjor mnufcturers, bnks, nd governments. HRIS cn support long rnge plnning, with informtion for lbor force plnning, nd supply nd demnd forecsts; stffing with informtion on equl employment, seprtions, nd pplicnt qulifictions; nd development with informtion on trining progrm costs nd trinee work performnce. HRIS cn lso support compenstion progrms with informtion on py increses, slry forecsts, nd py budgets; nd lbor/employee reltions with informtion on contrct negotitions nd employee ssistnce needs. In every cse the purpose is to provide informtion tht is either required by humn resource stkeholders or supports humn resource decisions. pplictions Some informtion is gthered for the purpose of stisfying n externl stkeholder's requirement. Other informtion is gthered becuse it is required to fulfill the employment reltionship. Most HRIS begin with this required informtion. Mny of the computerized enhncements to informtion systems re designed to produce this required informtion fster or t lower cost. The benefits of the informtion re obvious- the orgniztion would not be llowed to continue in business if it didn't use the informtion to produce the required reports or pyments. So, ttention focuses on producing the informtion nd completing the reports t the lowest cost. These kinds of pplictions emphsize doing dministrtive tsks fster, with less pper, or with fewer people. They re by fr the most common HRIS pplictions, becuse their vlue is reltively esy to clculte. One cn redily see, bsed on ctivities of number of public nd privte sector orgniztions, tht the use of HRIS hs been minsty in their efforts to downsize nd reengineer their humn resource functions. Two very prominent exmples of this type of ppliction re the Deprtment of Defense's conversion to n "off the shelf" softwre pckge (Orcle HR) nd Hewlett Pckrd's use of People Soft to ssist in their reengineering of how humn resource functionl services re provided in globl environment. In ech orgniztion, substntil reductions in stff were possible through the use of vlue dded process reviews nd the use of humn resource informtion systems. There re mny exmples vilble tht describe the use of HRIS in the mngement process, but ll utilize the bsic premise discussed herein. While utomtion cn cut dministrtive costs, such pplictions re bsed on the bsic ssumption tht the dministrtive ctivity should be continued. Mny orgniztions re finding tht the most fundmentl vlue of technology is its bility to encourge new thinking tht removes the need for lyers of dministrtion. This kind of fundmentl chnge is clled reengineering (Hmmer 2000). Mny orgniztions re utilizing utomted systems tht hve reengineered processes by using interctive employee informtion kiosks or Internet-bsed Web pplictions. Levi Struss uses system clled OLIVER, nd systems like it hve been utilized by the Office of Personnel Mngement (FED EXRESS) to collect dt on employees who use computers to nswer their own questions, test the implictions of certin decisions, nd even chnge their enrollment in benefits. By reengineering benefits informtion this wy orgniztions not only reduce the stff needed to nswer questions, but lso crete new nd more direct reltionship with employees. Mny similr systems re being utilized to provide employees nd mngers the opportunity to interct with the orgniztion's dtbses to pply for jobs, review orgniztionl regultions, nd to fcilitte communictions between employees, mngers, nd lbor unions. Some orgniztions such s Hewlett Pckrd nd the vrious defense gencies re utilizing HRIS tht hve expnded beyond the locl re network to include the use of the Internet or n Intrnet to disseminte informtion to employees. softwre pckge clled RESUMIX will be used by the Deprtment of Defense to operte its stffing progrm, which ws previously done lrgely by pper. It utilizes the bsis of expert systems technology to process lrge mounts of dt rpidly with fewer people. nother wy to reengineer HR processes through the use of HRIS is to focus on how informtion is used by HR mngers. While much dministrtive informtion is gthered nd used becuse government gencies or others require it, lrge mount of the HR informtion gthered by orgniztions is not required. Presumbly, it is gthered becuse someone in the orgniztion looks t it, uses it, nd mkes better decisions becuse of it. The vlue of such informtion is bsed on two fctors: 1. How mny decisions will be improved by hving the informtion 2. How much vlue will ech improved decision produce The vlue of informtion must then be weighed ginst the cost of the informtion to determine whether the informtion represents good investment. HRIS is lso n investment. Even modertely functionl softwre pckges cn be very expensive, nd tht does not include the costs of hrdwre, trining, nd mintennce costs, which cn totl up to 16 percent of totl cost. Becuse n infinite vriety of informtion cn be gthered nd trcked bout employees, humn resource mngers must crefully consider the likely vlue of the informtion they include in the HRIS. The svings re compred to the investment necessry to cquire nd use the computer system. computer system my enhnce vlue by mking it esier to get nd use informtion. It cn lso reduce informtion vlue by intimidting informtion users, or requiring so much expertise tht it is imprcticl to use. So, we cn consider two generl purposes of HRIS pplictions s dministrtive purposes tht reduce processing costs nd time, nd decision-support pplictions tht ssist HR mngers, non-HR mngers, nd employees to mke better decisions. The key is to focus on mking better decisions, not just producing dt fster (Hmmer 2000). Components of n HRIS It is convenient to consider these three mjor functionl components in ny HRIS: Input (r) Dt Mintennce (r) Output The input function enters personnel informtion into the HRIS. In the pst, dt entry ws often the only wy. Tody, scnning technology llows computers to scn nd store the ctul imge off n originl document, including signtures nd hndwritten notes. fter the dt hve been entered into the informtion system, the dt mintennce function updtes nd dds the new dt to the dtbse. In non-computerized systems, clerks do this by hnd; they file pper documents nd mke the pproprite entries in the files. Computerized systems ccomplish this function ccurtely nd rpidly, often mking the new dt vilble only seconds fter being input. This re is growing rpidly to llow for electronic dt storge nd workflow mngement. The most visible function of HRIS is the output generted. To generte vluble output for computer users, the HRIS must process tht output, mke the necessry clcultions, nd then formt the presenttion in wy tht the user cn understnd. Non-computerized systems do this by mnully compiling sttistics nd typing reports. However, no mtter how compelling the technology, the informtion presented is still the hert of system's vlue. So, it is importnt to consider the users, nd how they employ the informtion system. In mny of tody's orgniztions, employees, line mngers, nd vriety of humn resource nd other stff use the informtion in the HRIS directly through their PCs, telephones, or in written form. This trend is likely to continue with users demnding more ctive role in the input, mintennce, nd output functions of the HRIS. The use of expert systems in progrmming the questions, logic, nd decision rules re n dditionl feture of HRIS tht is gining populrity. Such systems cn be pplied to the decision of whether to reprimnd n employee, wht py level to ssign to job, which skills to look for in new tem member, or which benefit choices re best for n employee. Computer progrms cn cpture some of the experts' question ptterns nd decision rules. The user of n expert system gives honest nswers to the questions, receives nd crefully considers the system's recommendtions, nd cn sometimes use summry of the system's logic to lern how to be more expert. It is this type of logic tht is rpidly utilizing the interctive voice response (IVR) technology to become the next link in HRIS. The use of (IVR) llows fewer employees to provide informtion to lrger udience fster nd t lower cost. HRIS Design Process It is widely greed tht the first nd most importnt step in the design process is specifying the system requirements, especilly the trget users nd the decisions the system is designed to support. These specifictions include decisions bout the type of dt to collect, the mount of dt to collect, nd how nd when to collect the dt. The next step is business system design. This step involves nswering questions bout who will use the system, how they will ccess it, how it will be updted, nd more. Technicl system design lso includes softwre system development nd progrmming. The system is then tested t selected loctions nd evluted. Once in opertion, the system is evluted, improvements re determined, nd the process begins gin. Clerly, the forementioned principles of informtion vlue should be used to guide the choice of informtion to include in n HRIS. In ddition to the choice of wht informtion to include, the design of the HRIS must lso ccount for orgniztionl nd user chrcteristics. These orgniztionl nd user chrcteristics include the structure nd composition of the HRIS stff, the link between the HRIS technology strtegy nd tht of the lrger orgniztion, nd the impct of the HRIS stff's efforts on personnel nd the culture of the lrger orgniztion. The Future It would hve been impossible 10 yers go to ccomplish mny of the tsks previously described without the recent dvnces in computer networks nd user-friendly softwre. PCs hve definitely rrived in HR mngement. Hundreds of softwre progrms re helping HR mngers be more effective, nd more re on the wy. Mny orgniztions cn store their entire HR dtbses on tody's more powerful PCs. When PCs cn ccess minfrme computers, or cn be linked together to form networks tht shre informtion nd tools, the possibilities re virtully limitless. PCs re good t grphic presenttions of informtion, interctive dt nlysis, nd providing high degree of individul control. Minfrme computers re good t storing, retrieving, nd clculting very lrge dtbses, which cn be time-consuming on PC (Drucker 2002) PCs mke it possible to use technology such s touch-screens, interctive video, voice-ctivted responses, scnning technology, nd sophisticted multi-medi or grphics. Mny experts forecst tht the PC will become the centrl tool for ll HR professionls. This hs lredy become the cse in the orgniztions cited herein. The biggest impediments to reching the full potentil of HRIS re lck of money nd top mngement support. Other problems include the vilbility of pplictions/solutions to HR users nd system designer's lck of HR understnding. Tody, literlly thousnds of HR computer pplictions re vilble from consulting firms, softwre houses, nd the orgniztion's own system developers. However, the vst mjority of such pplictions focus on dministrtive tsks, rther thn decision support. While supporting decisions is more difficult, it lso seems to offer the gretest opportunity to ffect the HR profession. Future developments in HRIS must nd will ddress this re. HR users re demnding it, nd with time-lg, providers will respond. While the benefits of redy ccess to computerized HR informtion re compelling, this technology cretes new obligtions nd responsibilities for the HR professionl. The dt stored on computerized systems is often confidentil nd privte nd should be ccessible only to pproved individuls under controlled conditions. When HR dt resided on minfrmes nd required specil expertise to use, controlling ccess ws somewht esier. Cumbersome procedures, for ll their disdvntges, reduced the chnce tht unuthorized persons would gin ccess to the dt. Technology must be tempered with strong orgniztionl vlues. Summry It is esy to think of HR informtion systems in terms of the hrdwre nd softwre pckges used to implement them nd to mesure them by the number of worksttions, pplictions, or users who log onto the system. This rticle hs shown tht the most importnt elements of n HRIS re not the computers, but the informtion. The focus of ny comprehensive HRIS should be on informtion vlidity, relibility nd utility first nd on utomtion of the process second. Mny orgniztions hve gone through yers of expensive softwre development only to find tht the process for ccomplishing the work should hve been chnged, or dded little or no vlue to the end result. dditionl informtion is redily vilble on the Internet concerning some of the best systems tht hve been developed. The Civilin Personnel Mngement Service homepge contins considerble mount of informtion concerning the reengineering efforts within the Deprtment of Defense nd provides more detiled explntion of the process of developing HRIS to ssist in significnt downsizing (dms 2004). Exmples of privte sector compnies tht hve been successful in utilizing HRIS to reduce their humn resource stffs nd to more effectively utilize the informtion re Hewlett Pckrd, Cmpbell Soup, nd IBM. ll of the orgniztions embrced the concepts of vlue dded informtion for decision mking nd utomtion s tools to id in the reengineering of the humn resource mngement process. There re n equl number of smller compnies nd stte nd locl municiplities tht re embrcing HRIS, the Internet, nd other innovtions in communiction technology to chieve tremendous results in the humn resource mngement ren. This is only the beginning. In the HRIS re we hve tken the first step on the proverbil thousnd mile journey. The best is yet to come. 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