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incIudcs rcscarch articIcs that focus on

thc anaIysis and rcsoIution of managcriaI


and acadcmic issucs bascd on anaIyticaI
and cmpiricaI or casc rcscarch.
Organizational Environment and
Information Systems
1ho convorgonco of nformuton tochnoogos hus oponod now vstus of opportuntos us
wo us rsks for orgunzutons. Crgunzuton structuro, contros, und munugomont huvo u
wtnossod u sou chungo wth thor nformuton systoms (lS) bocomng tochnoogy drvon.
lS s soon us u strutogc too thut must bo wutchod curofuy n ordor to oud to corporuto
vson. lor tho frst usors, lS muy brng compottvo udvuntugo but, for most, t bocomos
u nood for survvu. 1o sustun n ths dynumc onvronmont, oxocutvos nood to bo on u-
tmo-uort to muko suro thut thoy do not ug bohnd compotton. A study of bost-run
orgunzutons ndcutos thut to koop busnoss und lS ugnod, thoy huvo hghy couborutvo
bohuvour us wo us wo-dofnod pocy for ovuuutng lS.
1hs pupor suggosts un ACL Modo u 3-rng modo, comprsng of procossos to
(A)dupt, (C)ouboruto und (L)vuuuto, n ordor to ostubsh und ovuuuto orgunzutonu
offoctvonoss for mprovod lS offoctvonoss n tho orgunzutons. At tho coro s tho nood
to cutvuto u cuturo to udupt tho utost toos und tochnquos for hghor ond uso. Noxt, tho
poopo must couboruto und work n toums for fustor und bonofcu puns und
mpomontuton. lnuy, u wo-dofnod procoss for constunt montorng und rofnomonts
of tho puns s roqurod. 1ho rngs sgnfy contnuty of tho throo procossos. 1hoso
procossos shoud not bo trggorod ut spocfc ntorvus. Ruthor, thoso must bo mbbod n
tho cuturo of tho orgunzuton so thut tho ompoyoos broutho n und broutho out tho sumo
thoughts und oxocuto thom togothor. 1ho modo offors u smpo, foxbo, und moduur
upprouch to ussoss orgunzutons onvronmont for lS offoctvonoss on u 5-pont scuo.
1hs pupor hghghts tho foowng ssuos:
1horo s u nood for lS ovuuuton vs--vs orgunzutonu onvronmont. ln ordor to
rouzo vuuo from l1, t s worthwho to unuyso und onsuro un offoctvo
onvronmont n tho orgunzuton thut s conducvo to chungo of tochnoogy und
systoms. 1hs cun onsuro ugnmont of orgunzuton, ts purposo, ompoyoos,
functons, und stukohodors.
lrrospoctvo of tho tochnoogos n uso, orgunzutonu ovuuuton procoss must bo
un ndcutor of contrbuton of lS towurds growth or sustonunco of busnoss though
tho oppononts of lS ovuuuton muy ko to concudo ths us nfousbo on tho
ground thut lS bonofts uro urgoy ntungbo und honco unquuntfubo.
1ho fndngs of ths study cun hop tho busnoss orgunzutons n dontfyng und
mprovng tho onvronmont for cutvutng lS n thor orgunzutons. lt s
rocommondod to huvo moro softwuro toos for docson-mukng und nformuton
unuyss so thut tho spondng on l1 cun bo utzod bottor.
Docson mukors cun dopoy tho suggostod modo on thor ntrunots to koop u
constunt wutch on tho cuturo of tho orgunzuton und uct uccordngy n ordor to
koop tho offoctvonoss ndox to tho hghost ovo.
R f S f AR CH
KfY WORDS
lnformation Systcms (lS)
lS Adaptation
CoIIaborativc fnvironmcnt
lS fvaIuation
Organization fnvironmcnt
lS PIanning
fxccutivc Summary
Kumnu Muk und D F Coyu
VlKALPA - VCLLML 28 - NC l - IANLAkY - MAkCH 2003 6l
T
echnology convergence has given new shape and
style to business environment where the success
of investments of an organization depends on
its ability to manage information technology (IT). This
necessitates a shift in the organization culture and
climate that must begin with senior management and
extend through the entire organization. In fact, an over-
emphasis on IT at the cost of human involvement and
commitment resulted in major implementation failures
of business process re-engineering initiatives to the
tune of 70 per cent (Malhotra, 2000). An earlier study
by Malik and Goyal (2000) indicated lack of alignment
between information system (IS) and functional units
and between functional units themselves.
In the light of the above discussion, it becomes
imperative to evaluate and improve the organizational
climate and readiness for effective use of IS. In this
paper, we present a model that takes up climate from
the multi-dimensional point of view, viz. adaptive,
collaborative, and evaluative and apply it to the Indian
automobile industry. The results indicate a level of
effectiveness at less than moderate, lack of adaptive
nature, mild collaborations, and ad hoc evaluation
process.
INFORMA INFORMA INFORMA INFORMA INFORMATION SYSTEMS TION SYSTEMS TION SYSTEMS TION SYSTEMS TION SYSTEMS
EFFECTIVENESS EFFECTIVENESS EFFECTIVENESS EFFECTIVENESS EFFECTIVENESS
Andreu, Ricart and Valor (1998), Baets (1996), and
Cortada (1995) suggest that IS must be closely linked
to the business strategy that is changing in response to
the dynami c busi ness envi ronment. Thi s
synchronization cannot be achieved without having
well-established set of processes to carry out any IS
project as well as continuously practised mechanisms
to identify its weak points and to ensure that it is truly
contributing to the business goals. If the company
needs to focus on customer service, then IS must
support it. If identification of new markets is the
business priority, then IS should be in a position to
suggest avenues. Thus, an IS is effective when it is
beneficial for the organization as a whole and not for the
individual units/sub-units only.
For organizations who have successfully reaped
the benefits from IS and technology, it has been an
ongoing exercise of alignment and cultural change
rather than a one-time investment affair. It is the
manner in which they identify, adopt, and use IT that
makes them get higher returns from the same.
Recent studies (Cortada, 1998; Lucas, 1999) offer
interesting insights into what possible steps can be
taken to strengthen the use of IT in organizations. They
indicate that best-run organizations have aligned their
IS with business strategies. They consider IT
infrastructure as an asset rather than a liability. IT
plans are a part of business plans. Thus, organizations
have monthly reviews of how they are doing against
plans. These evaluations or reviews stress the
importance of corporate strategy and vision and focus
on the portfolio of IT investment opportunities.
Leading IT organizations like Cigna, IBM, and GM
indicate that the relationship this alignment fosters
with end-users is highly collaborative. Further, Dos
and Peffers (1995) derive from their study conducted
on 3,838 US banks that early adoption of technology is
positively related to the lasting benefits. Early adopters
of Automatic Teller Machines (ATMs) in the 1971-73
period were associated with larger market shares from
1979-83 which was sustained through 1983. However,
for banks adopting ATMs after 1973, there were little
significant benefits. Up to 42 per cent of variance in
performance was associated with early adopters. Even
assuming there is no direct visible return, sometimes,
IT is the only option left for survival in a competitive
scenario. For example, Southwest Airlines in Phoenix
had to make its presence felt on the web to remain
competitive. Barnes and Noble, the largest US book
retailer, was forced to sell books on the web after
Amazon books had a major success. However, the key
to success is business innovation in addition to
technology adoption. It is well known that the majority
of IS do not fully meet expectations due to strategic
problems, organizational change, supplier problems,
technophiles, poor management, user skills,
technophobia, lack of participation, and poor control
systems (Harris, 1997). Thus, a wide range of factors
individually or collectively affects the viability of IS
deployed. However, it is clear that the majority of
these factors relate to people. It is worth emphasizing
here that technical aspects are in a sense less important
than user participation, involvement, and ownership
of systems. With a positive attitude from all the
stakeholders, the technical problems can be rectified.
To achieve a win-win situation and remain market-
facing organizations, collaborations and alliances at
inter-and intra-organization level are necessary which,
62 CkCANlZA1lCNAL LNVlkCNMLN1 AND lNlCkMA1lCN SYS1LMS
in turn, require trust between the parties involved
(Libovitz and Rosansky, 1997; Pasternack and Viscio,
1999; Diese and King, 2000). A collaborating intention
is the most suitable to fully satisfy the concerns of all
the parties. In collaborating, the intention of the parties
is to solve the problem by clarifying differences rather
than by accommodating various points of view. It is a
state of assertiveness and cooperativeness (Robinson,
2001). Further, Weber and Pliskin (1996), Eldon (1997),
Cortada (1998), Lucas (1999) and Ravichandran and
Rai (2000) emphasize the need to cultivate an
organizational climate for sustained effectiveness of
IS. Therefore, the need to integrate effectiveness of the
process involved in the genesis of an IS product cannot
be ignored.
Every IT enabled business organization must have
ways to evaluate IS in order to leverage the best out of
such investments and to sustain continuous support
towards business goal achievement. This evaluation
cannot be ignored or compromised as the investments
involved are high; effective life time is less, and the
impact on business is tremendous. Finally, no laid out
processes are workable; no feedback is constructive
unless there is a culture to enable all this. To summarize
the essence of an effective IS, a simplified framework
can be depicted as in Figure 1. As already discussed,
there is a need to cultivate the climate of the
organizations so as to deploy the best-suited technology
and also reap maximum possible returns. We suggest
an Adapt-Collaborate-Evaluate (ACE) Model to
establish the organizational environment that is healthy
for the grooming of effective IS.
ACE MODEL ACE MODEL ACE MODEL ACE MODEL ACE MODEL OF ORGANIZA OF ORGANIZA OF ORGANIZA OF ORGANIZA OF ORGANIZATION TION TION TION TION
ENVIRONMENT EFFECTIVENESS ENVIRONMENT EFFECTIVENESS ENVIRONMENT EFFECTIVENESS ENVIRONMENT EFFECTIVENESS ENVIRONMENT EFFECTIVENESS
This model can be applied to establish and evaluate
the organizational environment which would be
effective for efficient use of IS. The structure and
application of the model is explained as follows:
Structure of ACE Model Structure of ACE Model Structure of ACE Model Structure of ACE Model Structure of ACE Model
The effectiveness of organizational environment can
be viewed as composed of three components as shown
by the three rings respectively in Figure 2. The rings
from inside-out are: Adapt, Collaborate, and Evaluate.
At the core is the need to adapt advancements in
technology and cultivate a culture to identify and
deploy latest tools and techniques for higher end use.
The second and the central layer is the one to
Collaborate. The outer layer focuses on evaluation of
plans, viz. their fulfilment. The rings indicate
continuity of the components. As one component
ceases to exist or the continuity is broken, the
organization can lag behind competition. The direction
of the arrow from inside out shows the incremental
effectiveness as an organization achieves the
milestones.
Organizational Ef Organizational Ef Organizational Ef Organizational Ef Organizational Effectiveness fectiveness fectiveness fectiveness fectiveness
To build the environment effectiveness, the organi-
zation must undergo the three phases as stated above:
Adapt Adapt Adapt Adapt Adapt
An organization is said to be adaptive if it is open to
new developments in technology, weighs the risks and
benefits associated, and deploys the technology while
mitigating possible risks associated with it. Even
though an organization might spend extra amount and
time as an early adopter, it gains more experience and
Figure 1: A Framework for Effective IS
[Rings indicate continuous processes taking the visibility of IS
effectiveness from inside-out.]
Figure 2: Proposed ACE Model of IS
Environment Effectiveness

Evaluate
Collaborate
Adapt
IS
Effectiveness
IS Process
Organization
Culture
IS Product
Business
Goals
VlKALPA - VCLLML 28 - NC l - IANLAkY - MAkCH 2003 63
can respond fast in a competitive environment. Unless
an organization is keen on adoption of new technology
and paradigms, the environment cannot be called
fertile for growth of technology innovations and
applications. To remain adaptive, managers and
employees have to be on all-time alert and keep abreast
with the developments in the field of IT. If a business
group does not take the initiative, the IS organizations
within the business group may take the lead in
acquainting themselves and the group with
advancements in the field suitable to the business
needs. However, such initiatives cannot go a long way
unless business groups themselves are actively
involved in the process.
Collaborate Collaborate Collaborate Collaborate Collaborate
An organization is said to be collaborative if all its
employees share common business goals and feel
equally responsible to achieve them. This collaboration
should finally bring the organization out of all physical
boundaries of departments, functions, and levels of
hierarchy. Organizations can achieve collaboration by
reducing authoritative roles at senior levels and
bureaucracy, encouraging lower levels to participate
and suggest without fear, and imparting suitable
training to people so that they see IT and IS as a
facilitator of their tasks. People in IS function should
also be trained to come out of their technology shells
and keep focus on business imperatives. Even if the
organization has employees who are adaptive as
individuals, it is the collaboration that can finally make
the organization adaptive.
Evaluate Evaluate Evaluate Evaluate Evaluate
An organization is said to be evaluative if it has well-
defined rules and roles to evaluate the IT and IS
performance agai nst wel l -defi ned standards.
Evaluation should be seen as a constant feedback
mechanism to make sure that all the bottlenecks and
failures are taken care of. Organizations should define
policy, models, and evaluators who can conduct
evaluations on well-defined intervals. A variety of
models exists in literature (Singh, 1993; Parker, 1996)
that can be applied to evaluate IS, but their impact can
be visualized only when evaluation is considered as
an on-going process. However, it should be kept in
mind that the deviations observed as a result of
evaluations cannot be transmitted to seniors and peers
or controlled and minimized unless the organization
has an adaptive and collaborative environment.
Evaluating Organizational Ef Evaluating Organizational Ef Evaluating Organizational Ef Evaluating Organizational Ef Evaluating Organizational Effectiveness fectiveness fectiveness fectiveness fectiveness
The organizations should constantly evaluate its
environment effectiveness for effective use of IS. The
four steps for evaluation are as follows:
Evaluate adaptive environment effectiveness, i.e.
how adaptive is the organization.
Evaluate collaborative environment effectiveness,
i.e. how collaborative are the employees.
Evaluate evaluative environment effectiveness, i.e.
how well-defined is the evaluation mechanism.
Evaluate gross environment effectiveness, i.e
combined effect of the above three steps.
RESEARCH METHODOLOGY RESEARCH METHODOLOGY RESEARCH METHODOLOGY RESEARCH METHODOLOGY RESEARCH METHODOLOGY
We tested the validity and applicability of the model
using the sample selected for the task. Three automobile
manufacturing organizations out of a total of four with
their headquarters and works in and around Delhi
(CMIE Prowess, May 1999) participated in this study
and seven ancillaries out of a total of 45 were selected
for the purpose of this study. These ancillaries were
chosen as they supplied the components to the
manufacturing organizations in the sample. This was
considered to study their collaborative working in IS
deployment. The respondents were chosen so as to
build a proper mix of all the managerial levels in
various functional areas of the organization (Graphs 1
and 2). Overall, 132 respondents participated in the
study. In order to expedite the data collection and to
Graph 1: Sample Distribution (Function-wise)
16%
19%
20%
36%
Administration
Human Resource Management
Information Systems
Marketing
Finance
Production
N=132; The segments indicate % responses from each function.
Frequency
4%
5%
16%
19%
20%
36%
Administration
Human Resource Management
Information Systems
Marketing
Finance
Production
64 CkCANlZA1lCNAL LNVlkCNMLN1 AND lNlCkMA1lCN SYS1LMS
Graph 2: Sample Distribution (Level-wise)
20%
49%
31%
Top
Middle
Operational
Frequency
31%
20%
49%
Top
Middle
Operational
allay the fears of the respondents, if any, we adopted
a questionnaire- cum-interview approach of data
collection. We also held some partially structured
di scussi ons wi th keen respondents i n vari ous
functional areas with a view to get more insights into
the IS practices and culture in the organization. Table
1 shows the correlation of the variables under study
against four independent variables, namely, company,
type of organization, function, and level of respondent.
In Box 1, we explain the method used to validate the
proposed model.
Table 1: Study of Correlation of Factors of Instruments with Independent Variables
Company Type of Functional Level of
Organization Area Respondent
Coeff.* Sig.* Coeff.* Sig.* Coeff.* Sig.* Coeff.* Sig.*
Transaction Handling -0.01 0.92 -0.01 0.96 -0.26 0.01 0.08 0.37
Routine Report Generation -0.05 0.60 -0.19 0.04 -0.13 0.15 -0.05 0.56
Structured Decision-making -0.30 0.00 -0.44 0.00 -0.01 0.91 0.20 0.03
Management Control -0.19 0.04 -0.38 0.00 -0.12 0.20 0.20 0.03
Enterprise Resource Planning 0.33 0.00 0.14 0.12 0.08 0.37 -0.11 0.23
Future Planning 0.07 0.46 -0.16 0.08 0.06 0.53 -0.06 0.51
Information Analysis (Using Data Warehouse) 0.04 0.66 -0.03 0.76 -0.11 0.24 0.04 0.68
Database Management Systems 0.18 0.04 0.18 0.05 -0.30 0.00 -0.10 0.29
Spreadsheets 0.24 0.01 0.31 0.00 -0.17 0.06 -0.18 0.05
Document Imaging Tools 0.03 0.77 -0.05 0.57 -0.07 0.45 0.06 0.50
Conferencing Facility 0.00 0.97 -0.11 0.24 0.01 0.94 0.08 0.41
Online Databases (CD or Internet-based) 0.01 0.95 -0.06 0.54 -0.02 0.82 0.06 0.50
EDI (Standard Format, Structured Data) 0.18 0.05 0.28 0.00 0.06 0.55 -0.13 0.18
Intranets 0.24 0.01 0.28 0.00 0.04 0.70 -0.24 0.01
E-Commerce -0.02 0.80 0.01 0.95 -0.08 0.41 -0.05 0.62
Department Management (Own) in IS Planning 0.09 0.35 0.03 0.75 0.06 0.55 -0.04 0.68
Department Staff (Own) in IS Planning 0.26 0.00 0.20 0.03 0.01 0.88 -0.11 0.26
Systems Management in IS Planning 0.23 0.01 0.09 0.36 -0.16 0.09 0.01 0.91
Organization Management in IS Planning for -0.45 0.00 -0.28 0.00 -0.09 0.32 0.08 0.39
Your Department
Department Management (Others) in IS Planning 0.03 0.72 0.02 0.82 -0.10 0.30 0.05 0.60
Department Staff (Others) in IS Planning 0.15 0.10 0.08 0.39 -0.04 0.69 -0.08 0.40
Department Head Role in Implementation -0.16 0.09 -0.23 0.02 0.02 0.83 0.21 0.03
Department Staff Role in Implementation 0.07 0.48 0.05 0.61 0.13 0.19 -0.17 0.09
Systems Management Role in Implementation -0.12 0.22 -0.04 0.68 -0.09 0.40 0.08 0.43
Systems Staff Role in Implementation -0.05 0.63 -0.02 0.86 -0.07 0.53 0.01 0.95
Organization Management Role in Implementation -0.39 0.00 -0.30 0.00 -0.04 0.69 0.03 0.73
*Coeff. is for Pearsons correlation and Sig. is 2-tailed significance.
VlKALPA - VCLLML 28 - NC l - IANLAkY - MAkCH 2003 65
Compute I T adaptation (E Compute I T adaptation (E Compute I T adaptation (E Compute I T adaptation (E Compute I T adaptation (E
I T I T I T I T I T
): ): ): ): ): Compute effectiveness
of IT adaptation (E
IT
) as the average of all responses of
IT usage on a 5-point scale. Thus,
E
IT
= S (x
ij
* L
i
/ 100)/N; .(1)
i = 1 to 5
j = 1 to N
where, L
i
denotes the effectiveness level (1 to 5) for each
j; L
1
denotes the type of IT not used; L
5
denotes heavily
used; N represents the number of types of IT such as
Database Management Systems, Intranets, etc. that one
would like to consider. There are eight types of IT and
x
ij
=percentage number of responses received at level
L
i
, for type j of IT.
Compute I S adaptation (E Compute I S adaptation (E Compute I S adaptation (E Compute I S adaptation (E Compute I S adaptation (E
I S I S I S I S I S
): Gather responses on the
following dimensions:
Transaction processing systems
Routine reporting systems
Structured decision-making
Management control
Enterprise resource planning
Future planning
Information analysis
Rank each dimension on a 5-point scale: dont
know(1); planned after two years (2); planned in next
two years (3); planned in next one year (4); and already
Box 1: Validity of the Instruments
We analysed the data using SPSS software package and applied
various statistical models like descriptive analysis, factor
analysis, standard deviation, and correlation.
The validity of the proposed model has been done as follows:
Scale Reliability
Reliability of the scale was studied for all the instruments using
Space Saver method of scale reliability. The Cronbachs Alpha
for all but two of the instruments was observed as above 0.6
(Table A). For evaluation instruments, the scales were retained
as they were as the purpose of the results was being met. This
was opted for as a trade-off between reliability and simplicity.
Further, the scale of 1-5 does not fit into the evaluation instrument
as the questions, in a way, together represent the degree to
which organizations evaluation policy has been defined.
Individually, these variables exist or they do not exist. Thus,
only boolean answer is expected to hold. The quality of how well
each one of them has been defined is subjective and may not
lead to any quantifiable conclusion.
Content Validity
The factors for building various instruments were identified based
on the study of well established literature by Murdick, Ross and
Clagger t (1984), Davis and Olson (2000), Lucas (1986),
Humphery (1990), Pressman (1992), Cortada (1995, 1998),
McNurlin (1998) and Obrien (1999). The practising managers
at senior level were also consulted before freezing the design.
A variable Any Other Response was kept with all the categories
to ensure openness. However, no additional significant factor
emerged. Informal discussions with the par ticipants also
revealed that the questionnaires were very comprehensive to
the extent of forcing them towards introspection.
Sensitivity
The instruments were assessed on the 5-point Likert scale.
Table A: Scale Reliability of the Instruments
Instrument Number of Items Cronbachs Alpha
IT Adoption 8 0.6603
IS Adoption 7 0.6499
Collaboration 16 0.8296
Evaluation 17 0.3095
METHODOLOGY FOR APPL METHODOLOGY FOR APPL METHODOLOGY FOR APPL METHODOLOGY FOR APPL METHODOLOGY FOR APPLYING YING YING YING YING
ACE MODEL ACE MODEL ACE MODEL ACE MODEL ACE MODEL TO EV TO EV TO EV TO EV TO EVALUA ALUA ALUA ALUA ALUATE TE TE TE TE
ORGANIZA ORGANIZA ORGANIZA ORGANIZA ORGANIZATIONAL TIONAL TIONAL TIONAL TIONAL EFFECTIVENESS EFFECTIVENESS EFFECTIVENESS EFFECTIVENESS EFFECTIVENESS
Evaluate Adaptive Environment Evaluate Adaptive Environment Evaluate Adaptive Environment Evaluate Adaptive Environment Evaluate Adaptive Environment Ef Ef Ef Ef Effectiveness (E fectiveness (E fectiveness (E fectiveness (E fectiveness (E
AE AE AE AE AE
) )) ))
To evaluate the adaptive climate of the organization
with respect to IS/IT, we should study the following:
Availability of tools of technology.
Usage of tools of technology for information
retrieval and analysis.
Gather r Gather r Gather r Gather r Gather response: esponse: esponse: esponse: esponse: Gather responses on the following
dimensions:
Database management system
Spreadsheets
Document imaging tools
Online database
Electronic data interchange
Intranets
Electronic transactions
Data warehouses
Rank each dimension on a 5-point scale: not
used(1); very less used(2); moderately used(3);
significantly used (4); and heavily used (5). Derive a
frequency table as shown in Table 2.
66 CkCANlZA1lCNAL LNVlkCNMLN1 AND lNlCkMA1lCN SYS1LMS
have or do not need (5). Make a frequency table as
shown in Table 3. Compute effectiveness of IS
adaptation (E
IS
) as the average of all responses of IS
usage on a 5-point scale. Thus,
E
IS
= S (x
ij
* L
i
/ 100)/N .(2)
i = 1 to 5
j = 1 to N
where L
i
denotes the effectiveness level (1 to 5) for
each j; L
1
denotes a type of IS not used; L
5
denotes
heavily used.
N represents the number of types of IS such as
transaction processing, future planning, etc. that one
would like to consider; and x
ij
= % no. of responses
received at level L
i
, for type j of IS.
Compute adaptation ef Compute adaptation ef Compute adaptation ef Compute adaptation ef Compute adaptation effectiveness (E fectiveness (E fectiveness (E fectiveness (E fectiveness (E
AE AE AE AE AE
) )) )): Adaptation
effecti veness i s computed as the average of
effectiveness of IT and IS adaptation as obtained from
expressions (1) and (2) respectively. Thus,
E
AE
= (E
IT
+

E
IS
)/2 .(3)
Evaluate Collaborative Environment Ef Evaluate Collaborative Environment Ef Evaluate Collaborative Environment Ef Evaluate Collaborative Environment Ef Evaluate Collaborative Environment Effectiveness fectiveness fectiveness fectiveness fectiveness
(E (E (E (E (E
AE AE AE AE AE
) )) ))
To evaluate the collaborative nature in the organization,
the role of various stakeholders can be studied in many
activities. These include new IS projects planning; data
architecture planning; procurement/development
planning; test and implementation planning; and
evaluation planning.
The prominent stakeholders whose involvement
should be studied are: project leaders (business); project
leaders (systems); functional heads; functional staff;
IS head; and IS staff.
Ideally, the roles for all involved should be
collaborative though other possible roles prevailing in
traditional organizations are authoritative, supportive,
neutral, and negative. Further, a study of the
organizational factors contributing to success and
failure of organizations can indicate strengths and
weaknesses of the organizational environment thus
Table 2: Frequency Distributions for IT Adoption
Level of Use DBMS Spreadsheets Document Conferencing Online EDI Intranets Electronic
Imaging Facility Data- Transactions
Tools bases
Very High 33.87 31.45 0.81 4.03 4.84 10.48 0.81
Fairly High 19.35 29.03 5.65 9.68 3.23 4.84 21.77 3.23
Moderate 18.55 15.32 15.32 8.06 15.32 13.71 15.32 7.26
Fairly Low 0.81 7.26 8.87 12.10 8.87 4.03 8.87 2.42
Very Low 4.03 1.61 8.87 9.68 20.16 8.87 4.84
Not Used 16.94 8.87 41.13 53.23 42.74 66.13 30.65 69.35
Cant Say 4.84 4.84 15.32 4.03 1.61 3.23 1.61 8.87
Missing 1.61 1.61 4.03 3.23 4.03 3.23 2.42 3.23
N=132; All figures in %.
Very High level of use indicates effectiveness at level 5. Not Used, Cant Say and Missing categories should be considered at level 1.
The trend shows decrease in usage with increased level of sophistication. DBMS and spreadsheets are the most popular tools in use.
Use of IT and Internet for formal real time business transactions is much less.
Table 3: Frequency Distributions for IS Adaptation
Transaction Routine Structured Management ERP Future Information
Handling Reporting Decision- Control Planning Analysis
making
Already Have 83.06 76.61 36.29 35.48 41.13 29.84 16.94
Dont Need 6.45 3.23 2.42 2.42 2.42 0.81 6.45
Planned in Next 1 Year 4.84 9.68 25.00 20.16 26.61 24.19 16.13
Planned in Next 2 Years 6.45 6.45 2.42 4.84 3.23
Planned After 2 Years 0.81 0.81 2.42 4.03 0.81 3.23
Dont Know about Plans 9.68 27.42 32.26 21.77 37.10 50.00
Missing 0.81 1.61 0.81 1.61 2.42 4.03
N=132; All figures in %.
Use of IT is higher for routine activities but quite low for analysis purpose. The plans also indicate little about the awareness or intent
of using automated informational tools for decision-making and control.
VlKALPA - VCLLML 28 - NC l - IANLAkY - MAkCH 2003 67
indicating the need to improve/eliminate the factors
hindering the effectiveness of IS.
Gather r Gather r Gather r Gather r Gather response esponse esponse esponse esponse: Identify the tasks involved in the IS
project life cycle such as planning, develop- ment,
implementation, etc. Get user responses on the
following dimensions:
Organization management
Department management
Department staff
I S management
I S staff
Rank each dimension on a 5-point scale: negative
or neutral (1); accommodating (2); authoritative (3);
compromising (4); and collaborative (5). Accommoda-
ting attitude involves passive acceptance of the ideas
of the dominant people; authoritative is better with
the assumption that these people hold vision; and
compromising is still better as it involves natural
adjustments. Obtain frequency tables as shown in
Tables 4(a) to 4(c).
Table 4(a): Frequency Distributions for Collaboration During New IS project Planning
Roles Planning for Respondents Department Planning for
Other Departments
Department Department Systems Organization Department Department
Management Staff Management Management Management Staff
Authoritative 17.74 1.61 10.48 32.26 8.87
Collaborative 27.42 26.61 33.06 19.35 36.29 23.39
Supportive 38.71 44.35 37.90 35.48 25.00 38.71
Neutral 11.29 24.19 8.06 6.45 25.00 33.06
Negative 0.81
Cant Say 0.81 0.81 1.61 3.23
Missing 4.03 2.42 8.06 3.23 4.84 4.84
N=132; All figures in %.
Department staff plays more of supportive i.e. passive role in IS planning. Users participation in other related departments planning is
also less, indicating lack of integration and staff ownership in planning. Ideally all must participate in a collaborative manner for the success
of a change.
Table 4(b): Frequency Distributions for Collaboration during Training Plans
Roles Department Department Systems Systems Organization
Management Staff Management Staff Management
Authoritative 25.00 20.97 0.81 36.29
Collaborative 27.42 23.39 29.03 21.77 9.68
Supportive 30.65 52.42 24.19 44.35 30.65
Neutral 3.23 8.87 5.65 10.48 5.65
Negative
Cant Say 1.61 2.42 3.23 3.23 4.84
Missing 12.10 12.90 16.94 19.35 12.90
N=132; All figures in %.
Training is crucial to any IS project. The frequency spread shows lack of collaboration in defining such needs. Such situation may lead
to forced training and hence less impact of learning.
Table 4(c): Frequency Distributions for Collaboration During Implementation Planning
Roles Department Department Systems Systems Organization
Management Staff Management Staff Management
Authoritative 13.71 18.55 2.42 28.23
Collaborative 20.16 24.19 25.81 27.42 10.48
Supportive 40.32 50.00 28.23 34.68 33.06
Neutral 6.45 9.68 4.03 12.90 8.87
Negative
Cant Say 6.45 4.03 4.84 3.23 4.03
Missing 12.90 12.10 18.55 19.35 15.32
N=132; All figures in %.
A major group of users is in supportive role only. Supportive, as considered passive role in this study may result in lack of ownership of
implementation.
68 CkCANlZA1lCNAL LNVlkCNMLN1 AND lNlCkMA1lCN SYS1LMS
Compute col l aborati ve envi r Compute col l aborati ve envi r Compute col l aborati ve envi r Compute col l aborati ve envi r Compute col l aborati ve envi ronment ef onment ef onment ef onment ef onment effecti veness fecti veness fecti veness fecti veness fecti veness
(E (E (E (E (E
CE CE CE CE CE
): ): ): ): ): Compute E
CE
as the average of responses in-
dicating collaborative participation of all groups of
employees in every task of IS building. Thus,
E
CE
=

Avg of

(E
CE
)
t
for all

tasks t ....(4)
where,
(E
CE
)
t
= S (x
ij
* L
i
/ 100)/N ......(5)
i = 1 to 5
j = 1 to N
L
i
denotes the effectiveness level (1 to 5) of collaboration
for each group j in each task t. L
1
denotes least effective
and L
5
denotes highly effective collaborative en-
vironment; N represents the number of groups whose
roles have to be considered during an IS task t, e.g. IS
planning and IS implementation and x
ij
= percentage
number of responses received at level L
i
for type j of
group.
Evaluative Environment Ef Evaluative Environment Ef Evaluative Environment Ef Evaluative Environment Ef Evaluative Environment Effectiveness (E fectiveness (E fectiveness (E fectiveness (E fectiveness (E
EE EE EE EE EE
) )) ))
Finally, the evaluation policy and practices of the
organization should be studied to identify frequency,
evaluation criteria, initiators, and participants of the
IS evaluation.
Gather r Gather r Gather r Gather r Gather response: esponse: esponse: esponse: esponse: Get users yes or no responses on the
following factors:
Evaluation periodicity defined
Evaluation roles defined
Evaluation criteria defined
Evaluation defined with guidelines for corrective
actions
Derive the frequency table as shown in Table 5.
Compute evaluative envir Compute evaluative envir Compute evaluative envir Compute evaluative envir Compute evaluative environment ef onment ef onment ef onment ef onment effectiveness (E fectiveness (E fectiveness (E fectiveness (E fectiveness (E
EE EE EE EE EE
): ): ): ): ):
Compute E
EE
as the average of all responses about
presence/absence of evaluation policy. Thus,
E
EE
= S (x
i
* L
i
/ 100) ....(6)
i=1 to 5
where, i = 1 to 5, L
i
denotes the effectiveness level (1
to 5); x
i
= percentage number of responses received at
level L
i
. L
i
can be assigned as follows: L
i
= 1 , if no factor
has been defined; L
i
= 2 , if periodicity has been defined;
L
i
= 3 , if periodicity + roles have been defined; L
i
= 4
, if periodicity + roles + criteria have been defined; L
i
= 5 , if periodicity + roles + criteria + counter measures
have been defined.
Measure Gross Environment Ef Measure Gross Environment Ef Measure Gross Environment Ef Measure Gross Environment Ef Measure Gross Environment Effectiveness (E fectiveness (E fectiveness (E fectiveness (E fectiveness (E
E EE EE
) )) ))
Gross environment effectiveness should be measured
as the average of adaptive effectiveness (E
AE
),
collaborative effectiveness (E
CE
), and evaluative
effectiveness (E
EE
) as obtained from expressions (3),
(4) and (6). Thus,
E
E
= (E
AE
+ E
CE
+ E
EE
) / 3 .....(7)
FINDINGS FINDINGS FINDINGS FINDINGS FINDINGS
Adaptive Ef Adaptive Ef Adaptive Ef Adaptive Ef Adaptive Effectiveness fectiveness fectiveness fectiveness fectiveness
Data base management systems and spreadsheets are
the most commonly used IT tools. Email is a commonly
used application for office communication at all levels
for intra-office and inter-office communications.
However, this facility is used to exchange general
information and also specific details about orders but
in unstructured data formats. This is a predominant
mode of communication between manufacturers and
their ancillaries.
It is a good practice to begin with developing a
culture of e-communications, but the unstructured
format of communication inherits with it the problems
of duplicity, redundancy, and inaccuracy due to
required conversion of data from/to legacy
applications of the respective organizations.
Adaptation of IS and IT is very weak. Tables 2 and 3
summarize the descriptive findings of their adaptation.
It is evident that the transaction processing has a very
high use at present but the information use is low for
decision-making, control, future planning, and
information analysis. Further, over 80 per cent of the
respondents feel that they have or will have routine
reporting, structured decision-making, and control
within the next one year. However, nearly 40 per cent
and 54 per cent of the respondents do not have any
Table 5: Completeness of Evaluation Planning
Practices
Criteria Considered
During Evaluation Percentage
Periodicity + Roles + Criteria + Controls
(Orgn. Policy) 11.29
Periodicity + Roles + Criteria 23.39
Periodicity + Roles 5.65
Periodicity 49.19
Nothing Defined 10.48
Total 100.00
N=132; All figures in %.
Though some of the departments have a period of evaluation
defined, the process to be followed is a dhoc with little defined
roles and criteria.
VlKALPA - VCLLML 28 - NC l - IANLAkY - MAkCH 2003 69
plans for using IS for future planning and information
analysis respectively, even after two years. Adoption
of IT tools also indicates the structured data handling
and processing only. Table 3 indicates the low
adaptation for the new tools except intranets.
The weakness is indicated by the decrease in use
as the level of sophistication increases, suggesting a
surface use of technology for information storage and
retrieval. Further, comparing these results with the
survey of Business Today (June 1997) which had
indicated a very low adaptation of IT in Indian industry,
no significant increase in its use has been found in the
last few years. Thus, the observation reveals that
though the investments have been increasing, still the
net usage for improved management remains the same.
This gap can be due to multiple reasons. One, that
the managers are not aware of the possible exploitation
of their information pool. Two, that the IS planning is
centralized; and three, that there are not sufficient
products and solution providers to address the analysis
requirements. The user managers have to, therefore,
generate the need and awareness for such products or
else the volumes of data stored could end up in large
data repositories and information overloads.
Collaborative Ef Collaborative Ef Collaborative Ef Collaborative Ef Collaborative Effectiveness fectiveness fectiveness fectiveness fectiveness
The collaboration with respect to IS projects is very
mild. Only 33 per cent of respondents feel the presence
of collaboration. Table 4 (a) to (c) exhibit the roles
played by various groups in different IS planning
activities. Authoritative roles dominate in the case of
organization and department management. A major
per cent of responses indicate a supportive role,
indicating a passive participation instead of active
collaborative participation. A supportive attitude
cannot contribute much in the absence of strong
leadership. A good indicator is the total absence of
any negative roles played by any group.
An analysis of organization factors that contribute
to success or failure of IS indicates personnel ego as
the highest contributor to failure, followed by lack of
frequent training, lack of available professional
consultancy, and high turnover of skilled staff. Table 6
summarizes the ranking of top factors for success and
failure of IS and a discussion is given later in the text.
The position of IS in overall organization hierarchy is
not reported to be very strong. Users indicated the
near absence of any interaction with IS staff. If at all it
was there, it was individualistic in nature.
For improved results, the organizations must
mitigate the factors contributing to failure. Though
some factors like high turnover rate, lack of consultants,
etc are industry driven, an organization can take good
measures to counterfei t them. For i nstance,
deployment of strong process definition and implem-
entation can help nullify the problems of high turnover
rate. Ego and lack of frequent training can be seen as
a direct outcome of lack of collaborative environment
and vice versa. The top management and IS
management must work towards breaking of such
barriers between departments and individuals by
proper training, strong process formulation, and
ensuring employees the ownership of success and not
failures.
Evaluative Ef Evaluative Ef Evaluative Ef Evaluative Ef Evaluative Effectiveness fectiveness fectiveness fectiveness fectiveness
Without constant evaluations, any investment can turn
to losses. Early or late adopters will come at par if they
do not learn from the lapses they encounter. These
evaluations can be effective only when there is a well-
defined process and also the participants are actively
participating towards constructive evaluation.
An organization must have a well-defined scheme
of evaluation, defining roles, and rules of evaluation.
Tables 5 and 7 reveal important observations about the
state of evaluation mechanism in the organizations. In
the absence of strong evaluation process, the control
on IS use will be released, rendering the defaulters
unnoticed and unanswerable, sufferers unattended,
and organizational investments underutilized.
Gross Environment Ef Gross Environment Ef Gross Environment Ef Gross Environment Ef Gross Environment Effectiveness fectiveness fectiveness fectiveness fectiveness
After applying the steps of environment effectiveness
computation as stated in the previous section, the
comparative chart as shown in Table 8 has been
obtained. The figures indicate less than moderate
effectiveness (less than 3 on a scale of 5).
Hindrance and Success Factors Hindrance and Success Factors Hindrance and Success Factors Hindrance and Success Factors Hindrance and Success Factors
The hindrance and success factors were the ones
favouring or impeding the success of IS in the
participating organization. To this effect, a set of 44
factors was identified based on the study of literature
and administered on the same sample using a 7-point
(-3 to +3) scale. Interaction with the managers in the
testing organizations further strengthened this list.
70 CkCANlZA1lCNAL LNVlkCNMLN1 AND lNlCkMA1lCN SYS1LMS
Factor analysis using Principal Components Analysis
and Varimax Rotation was applied to the responses to
identify the ranks of these factors (Boyd, 2000; Arora,
2000). Seven components were selected with factor
loading greater than or equal to 0.5. These seven
components explained 82.5 per cent of cumulative
variance. Table 6 shows the components with the
factors making the components. Table 9 shows the
ranking and average score of hindrance and success
Table 7: Evaluation Planning Practices
Activity % Yes
Log of System Failures is Maintained 23.40
Organization Policy for IS Evaluation Exists 24.20
Initiator of IS Evaluation is Well-defined 46.00
Criteria of IS Evaluation is Well-defined 63.00
N=132; All figures in %.
The table indicates poor directions set for evaluation. Very low
presence of practice for failure log indicates weak controls and also
the fact that the applications deployed do not possibly have a high
severity of risk stake attached to business.
Table 8: Comparative Chart of Effectiveness (on a
Scale of 1 to 5) of Participant Organi-
zations at Group Level
View of IS Effectiveness Industry Manufac- Ancillary
turing Units
Adaptive Environment 2.86 2.79 2.95
Collaborative Environment 2.62 2.63 2.61
Evaluative Environment 2.76 2.46 3.15
Gross Environment
Effectiveness
2.75 2.63 2.90
Effectiveness is below moderate level. The scenario is similar across
the type and size of organizations. The result has been obtained by
using the frequency tables and applying computations of the ACE
Model as explained in the text.
Table 6: Success and Hindrance Factors at Different types of Organizations
Component Factors in Component
1 User Participation and - Organization Democracy
Systems Management - Accuracy of Professional Consultancy
- Department Interest in Systems Growth
- Proper Use of Standards
- System Audits
- Customer Expectations
- User Involvement
- Competition in the Market
- System Quality Checks
- Department Staff Skills
- Position of IS Department in the Organization
2 Technology and Support - Availability of Software Manpower
- Awareness of Latest Technology Solutions
- Existing Maintenance of IT Tools
- Proper Implementation Plans
- Pace of Technology Change
3 Non-availability of - Lack of Skilled Staff in Systems
Skills and Standards - Lack of IS Standards
- Competition Between System and Other Units
4 Systems Involvement - Systems Involvement in Planning
- Systems Involvement in Development
- Systems Involvement in Implementation
5 Management Involvement - Management Involvement in Planning
- Management Involvement in Development
- Management Involvement in Implementation
6 Organization Culture - Organization Bureaucracy
- Organization Autocracy
- Personal Ego
7 Expenses - Cost of Technology
- Budget Allocation-High Turnover
The table indicates common factors that affect IS success and failure. These factors have been obtained by applying factor analysis
to the data obtained.
factors in the Indian automobile industry. For better
understanding, the ranks have been classified into three
categories based on the average score x as:
Positive factor (P) where +1 <= x <=+3
Limiting factor (L) where 1 <= x < +1
Failure factor (F) where 3 <= x < -1
VlKALPA - VCLLML 28 - NC l - IANLAkY - MAkCH 2003 7l
The limiting factors have an immediate scope of
improvement and can shift to the category of positive
factors. They can also turn to failure factor category, if
not properly monitored. Failure factors are chronic and
organizations must take special steps to eliminate them.
It is possible that some of these limiting/failure factors
are not in the immediate control of the organization,
e.g. lack of professional consultancy. In such a case,
organization needs to be more concerned.
Some important observations are as follows.
Personal ego is seen as the greatest hindrance to the
growth of IS in the organizations. Some managers
strongly stated that they all lived in their own rigid
walls and that IS needed to interact much more with
them.
Lack of training and existing skills are general
hindrances.
One positive indicator is the management support
and the resource availability. However, this needs
to be strengthened further by active involvement
of the management and also the staff so as to utilize
the funds in the right direction.
Availability of skilled manpower is a common
problem with all the organizations; to this effect,
proper documentation and well-defined processes
are the only solution. Further, these effects really
start emerging when the managers themselves
become the taskmasters.
Lack of standards is also seen as a major hindrance.
Table 9: Comparative Analysis of Hindrance and Success Factors at Different Types of Organizations
Component Industry Manufacturing Ancillary
Level Level Level
User Participation and Systems Management P P L
1.00 1.15 0.83
Technology and Support P P P
1.18 1.20 1.15
Non-availability of Skills and Standards L L L
(0.12) (0.02) (0.25)
Systems Involvement P P P
1.92 2.10 1.71
Management Involvement P P P
1.73 1.81 1.63
Organization Culture L L L
(0.01) (0.05) 0.04
Expenses L L L
0.26 0.24 0.29
The cells indicate the average score for the component on a scale of 3 to +3; Negative figures, indicating hindrances are shown in
parentheses. P, L and F imply Positive, Limiting and Failure factors. N=132.
Good indicator is that no factor was identified as severe factor for failure (category F). Management, user and technical support are giving
positive indications but at the same time organization culture (bureaucracy, autocracy and personnel ego) and expenses (technology
and staff turnover) are the major deterrents of IS success. These limiting factors can be reduced by improving as per indicators given
by various indices in earlier tables.
Though there are standards defined at BIS level,
they are more related to the software process and
not to the IS process. However, no one in these
organizations is using even the BIS level of practices.
Yet, as all the companies visited are ISO certified
for their production units, they claim to use the same
standard in all their activities.
CONCLUSIONS AND IMPLICA CONCLUSIONS AND IMPLICA CONCLUSIONS AND IMPLICA CONCLUSIONS AND IMPLICA CONCLUSIONS AND IMPLICATIONS TIONS TIONS TIONS TIONS
IT and IS are expensive but inevitable resources of any
organization. Some organizations deploy them to get
well-anticipated returns but others do it for survival.
In either case, in order to realize value from them, it is
worthwhile to analyse and ensure an effective
environment in the organization that is conducive to
change of technology and systems an environment
where users, rather than technicians, take ownership
of IS. This can ensure alignment of the organization,
its purpose, employees, functions, and stakeholders.
The proposed ACE model (Adapt-Collaborate-
Evaluate) offers a simple, flexible, and modular
approach to assess an organizations environment for
IS effectiveness on a scale of 1-5. Decision makers can
use it to identify weaknesses of the organization and
to get guidance for its improvement.
The study presented here bri ngs out that
organizational environment effectiveness in Indian
automobile industry is less than moderate. Personnel
72 CkCANlZA1lCNAL LNVlkCNMLN1 AND lNlCkMA1lCN SYS1LMS
ego, bureaucracy, high cost of technology, and turnover
are seen as factors limiting the effectiveness. There is
lack of collaboration and a near absence of defined
evaluation mechanism in these organizations. It may
be argued that IS returns being largely intangible,
cannot be evaluated. However, in the absence of
quantitative measures, a qualitative control mechanism
must exist to ensure increased utilization of IT spending
in large systems-based integrated set-ups. This paper
has its limitations too. It focuses on only one
perspective for improving the effectiveness of IS, i.e.
internal environment of the organization. Ultimately,
an integrated approach to effectiveness needs to be
considered that involves all dimensions of information
process system (conception to use), the business and
technical environment as well as the quality of final
product viz-a-viz its purpose. Malik and Goyal (2001)
address this issue further. The views suggested in this
paper can further be extended to include content
integrity, people integrity, process integrity, medium
integrity, and open nature of systems.
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A cortfod uuty Anuyst (CA) und rocpont of tho ost Fupor
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of FCDM progrummo. Hor rosourch ntorosts ncudo softwuro
quuty, nformuton systoms offoctvonoss, und nformuton ntogrty.
o-mu: kumnumukgmt.uc.n
D P GoyaI s Frofossor ut lnsttuto of Munugomont 1ochnoogy,
Chuzubud. Hs urous of ntorost uro munugomont nformuton
systoms, docson support systoms und ontorprso rosourco punnng.
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Rcvcrsing Your Pcrspcctivc
It s a good tochnquo iot oonng u yout thnlng. Hotos an oxamlo.
lot many yoats, 10
th
contuty Inglsh hyscan Idvatd /onnot votlod
to ind a cuto iot small ox. -itot studyng many casos, ho toachod an
masso n hs thnlng. Thon ho tovotsod hs otcoton oi tho toblom.
Instoad oi iocusng on oolo vho had small ox, ho svtchod hs attonton
to oolo vho novot had small ox. Ho iound that daty mads tatoly
got tho dsoaso. It tutnod out that most daty mads had cov ox, a smlat
but usually non-iatal aiilcton. Cov ox had sotvod to vaccnato ts vctms
aganst tho moto dangotous small ox. Ths lod to /onnots concot oi
vaccnatng oolo.
Rogcr von 0cch
- \hacl on tho 5do oi tho Hoad
74 CkCANlZA1lCNAL LNVlkCNMLN1 AND lNlCkMA1lCN SYS1LMS

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