Saturday, December 24, 2011

Customers-Organisation Interface and Emergent Organisation

The past application of IT has seen the automation, support, and re-design (re-engineering) and transformation of business activities. IT Governance became progressively complex through these phases of IT application to business. The current move is towards new 'models' of e-business. The new e-business models require strategy formulation and careful IT Governance through prescribed methods, for example, IT Balanced Scorecard (Van Grembergen, 2000), but there are also fundamental aspects of e-business that IT Governance needs to consider that prescribed methods cannot cover.

 

Corporate design, information and knowledge are intertwined. Information and knowledge are a prime element of organisation design, and e-business technology has enabled the complex integration of all three in e-business models such as e-shop, e-mall or third-party marketplace (Timmers, 1999). Organisation theorists assert that information processing and coordination of work tasks are central features of an organisation (Gailbraith, 1977; Minzberg, 1979; Groth, 1999). Following the history of industrial design, the premise in IT Governance and IS development is that computer-based information processing requires central design. The use of IT for information processing makes central IT Governance and designs an invalid proposition in the 21st century organisation.

The various interfaces between a company and its customers, partners and employees need to be both functionally relevant and easy to use. Certain interfaces such as customers cannot be trained to use e-business IT systems. The design of these interfaces is critical to the success of an e-business. The new e-business organisation requires a multidisciplinary team to deliver relevant and effective solutions. Designers, creatives, psychologists and developers all can contribute to the novel e-business systems. IT Governance and design need to be local and in actual-time (when it is required). So modern information processing in organisation requires an amethodological or distributed governance too. In methodological approaches the analysis, design, and implementation of IS solutions to organisational problems are separated and controlled centrally. An amethodological approach proposed by Patel (1999), deferred system's design (DSD), enables organisations to delay design decision making to mitigate risk, and permit procedural, operational or policy problems to be resolved locally. E-business systems in banking incorporate DSD (Theotokis et al., 1997) to allow emergent and tailorable information processing needs to be facilitated locally.
The System's EnvironmentA system that is not impacted highly by the environment remains constant. Its architecture and functionality remain stable with minor changes because the human or organisational force for change is nil or minimal. It is difficult to find examples of such systems in e-business systems. A system that has a high environmental impact on it, for example a web-based marketing system, needs to constantly change. The forces for change are high and constant on such systems. In general, e-business systems are of the latter type. 

The complexity of a customised order processing system such as for personal computers or cars or an electronic bidding system such as for auctions increases with the degree of their embeddedness in the environment. Generally, such e-business systems have a high correlation with the organisational (and economic) environment in which they function. Figure 1 is an organisation environment impact analysis of e-business systems that need to cater for organisational emergence. When the correlation with the environment is high, e-business systems need to be developed using DSD, as shown in the top right quadrant. Over time, environment impact on systems requires most systems to move clockwise from the bottom left quadrant to the top right quadrant.
Emergent ways of IT Governance do not seek to specify fixed systems architecture, so that the future use of IS and its flexibility can be accommodated. Information and knowledge systems that are built on emergent principles such as DSD would be capable of accommodating the complexity of organisational phenomena and change increasingly evident in an e-business economy.

Information and knowledge ontologies are not an aspect of current IT Governance, especially that concerned with aligning IT with business strategy. This aspect is critical given the inclusion of the customer in the operations of the business. E-business companies will have to develop deeper understandings of their products, customers, and partners through better information and knowledge creation, sharing and analysis in a shifting environment. 

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