Iman Ali
MBA 513
Assignment 1
How Information Systems impact organizations and business firms
An information system is any organized system for the storage, organization, collection and communication of information. It is the study of complementary networks of software and hardware that individuals utilize to filter, process, collect, create and distribute data. In my paper, I will talk about how Information Systems impact organizations and business firms. The focus of my paper will be on the economic impacts and the organizational and behavioral impacts. Within the organizational and behavioral impacts, I will talk about how IT flattens organizations.
The textbook talks about how in the last decade Information Systems have impacted the …show more content…
IT potentially reduces the costs for a given size, shifting the transaction cost curve inward, opening up the possibility of revenue growth without increasing size, or even revenue growth accompanied by shrinking size. Transaction cost theory states that organizations grow in size because they can obtain certain products or services internally at lower cost than by using external firms in the marketplace. By lowering the cost of market participation (transaction costs) information technology allows firms to obtain goods and services more cheaply from outside sources than through internal means. Information systems can thus help firms increase revenue while shrinking in size (Pretorius, …show more content…
IT can reduce the number of levels in an organization by providing managers and supervisors with information to supervise larger number of workers and by giving lower-level employees more decision-making authority as is seen in the image below (Laudon, 2014, p. 121).
Flattening Organizations
The above images are taken from the textbook by author Laudon, pg. 121
Role Information Systems play in the organizational environment
Environments shape what organizations can do, but organizations can influence their environments and decide to change environments altogether. Information technology plays a critical role in helping organizations perceive environmental change and in helping organizations act on their environment ("How Information Systems Impact Organizations and Business Firms."). In my experience in the workplace, I have found that Information Systems
has changed the behavioral and economic aspects of businesses. Technologies such
as database systems, social media, industry driven software have become a crucial
aspect that is changing the way we operate and run businesses. If a business wants
to succeed, the only way to do it is by implementing good Information Systems
MBA 513
Assignment 1
How Information Systems impact organizations and business firms
An information system is any organized system for the storage, organization, collection and communication of information. It is the study of complementary networks of software and hardware that individuals utilize to filter, process, collect, create and distribute data. In my paper, I will talk about how Information Systems impact organizations and business firms. The focus of my paper will be on the economic impacts and the organizational and behavioral impacts. Within the organizational and behavioral impacts, I will talk about how IT flattens organizations.
The textbook talks about how in the last decade Information Systems have impacted the …show more content…
IT potentially reduces the costs for a given size, shifting the transaction cost curve inward, opening up the possibility of revenue growth without increasing size, or even revenue growth accompanied by shrinking size. Transaction cost theory states that organizations grow in size because they can obtain certain products or services internally at lower cost than by using external firms in the marketplace. By lowering the cost of market participation (transaction costs) information technology allows firms to obtain goods and services more cheaply from outside sources than through internal means. Information systems can thus help firms increase revenue while shrinking in size (Pretorius, …show more content…
IT can reduce the number of levels in an organization by providing managers and supervisors with information to supervise larger number of workers and by giving lower-level employees more decision-making authority as is seen in the image below (Laudon, 2014, p. 121).
Flattening Organizations
The above images are taken from the textbook by author Laudon, pg. 121
Role Information Systems play in the organizational environment
Environments shape what organizations can do, but organizations can influence their environments and decide to change environments altogether. Information technology plays a critical role in helping organizations perceive environmental change and in helping organizations act on their environment ("How Information Systems Impact Organizations and Business Firms."). In my experience in the workplace, I have found that Information Systems
has changed the behavioral and economic aspects of businesses. Technologies such
as database systems, social media, industry driven software have become a crucial
aspect that is changing the way we operate and run businesses. If a business wants
to succeed, the only way to do it is by implementing good Information Systems