Chapter 9 - IS Stragety, Goverance, and Ethics.docx

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Computer Science
Computer Science 1032A/B
Diane Goldstein

CHAPTER 9, IS STRATEGY, GOVERNANCEAND ETHICS 1. WHAT IS THE RELATIONSHIP BETWEEN ORGANIZATIONAL STRATEGYAND INFORMATION TECHNOLOGY PLANNING? ­ competitive strategy: strategy that org chooses as the way it will succeed in its industry  Porters Model ­ supported through activities by IS  fig 9.1 ­ IS a company chooses should support company’s competitive strategy 2. WHAT IS INFORMATION TECHNOLOGYARCHITECTURE? ­ ITArchitecture: basic framework for all the computers, systems and information management that support organizational services ­ Enterprise architect: job is to create a blueprint of an orgs info systems and the management of these systems  blueprint should provide an overview that helps people in the organization understand current investments in technology and plan for changes ­ In developing architecture  considers organizational objectives, business processes, databases, information flows, operating systems, applications and software and supporting technology ­ Architecture is usually long document with many sections including diagrams and discussion of future changes to architecture ­ Zachman framework: john Zachman  IBM o Framework divides system into 2 dimensions o 1. Based on 6 reasons for communication (what-data, how-function, where-network, who- people, why-motivation, when-time) o 2. Based on stakeholder groups (planner, owner, designer, builder, implementer, worker) o intersection of these 2 dimensions help provide a holistic view of the enterprise  fig 9-2 ­ development of an enterprise architecture can be critically important when organizations are considering significant changes such as mergers, acquisitions, divestiture or rapid growth 3. WHAT IS ALIGNMENT, WHY IS IT IMPORTANTAND WHY IS IT DIFFICULT ­ alignment: process of matching organizational objectives with IT architecture ­ alignment process takes advantage of IT capabilities as they develop while maintaining a balance between business objectives and IT architecture ­ ex. Wal –Mart: spends more than industry average on info tech o developed sophisticated network of information technology applications that allows it to collect and share vast amounts of information which allows ees and suppliers to make effective decisions to operate more efficiently ­ wal mart is high tech company that found success as low cost leader ­ Reich and Benbasat  measured alignment as degree to which IT dept’s missions, objectives and plans overlapped with overall business missions, objectives, and plans ­ Effective alignment occurs in orgs that have developed a climate supporting the sharing of domain knowledge and common business practices  social dimension of alignment ­ Communication b/w business and IT execs is more important indicator of alignment  confirmed by Chan ­ Shared knowledge can become a source of comp adv for firms because firms are better able to align their IT investments with the overall business objectives 4. WHAT IS INFORMATION SYSTEMS GOVERNANCE ­ governance: suggests that some committee or political party has the ability to decide on expectations for performance, to authorize appropriate resources and power to meet expectations and eventually verify whether expectations have been met ­ in publicly traded orgs, one purpose of governance is to ensure on behalf of shareholders that org produces good results and works to avoid bad ones ­ business orgs  governance designed to work towards development of consistent, cohesive management policies and verifiable internal processes ­ managing at corporate level  est ways in which board oversee a corp and est rules that apply to issues such as sourcing, privacy, security and internal investments ­ goal of IS governance is to improve benefits of orgs IT investment overtime ­ fig 9-3  reporting structures and review processes The Sarbanes OxleyAct and the Budget Measures Act ­ Sarbanes OxleyAct: US ­ Budget MeasuresAct/Bill 198: Canada ­ Governs the reporting requirements of publicly held companies ­ Enacted to prevent corporate fraud like WorldCom and Enron ­ Regulations increase level of responsibility and accountability of executive management of publicly held Canadian companies traded on the TSX ­ Require management to create internal controls sufficient to produce reliable financial statements and to protect the organization’s assets ­ Management is required to issue a statement indicating it has done so ­ External auditor must issue opinion on quality of internal controls an credibility of management statements ­ Expose management and external auditor to financial and criminal liability if subsequent events show that internal controls were defective ­ Ex. Internal control  separation of duties  3 ppl are to authorize, issue and account for transaction 
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