CHAPTER 8 INTERORGANIZATIONAL AND GLOBAL INFORMATION SYSTEMS

1. CHAPTER 8INTERORGANIZATIONALAND GLOBALINFORMATION SYSTEMS

2. Definition of Interorganizational Information System • Supports information flows between two or more organizations • Strategic impact of IOSs • Networks: • Private (VANs) • Publicly accessed

3. Characteristics of IOSs • Sponsor – participant relationships • Forms of participation: • Submit request – receive output • Access to data storage and processing resources • Use capabilities of IOS

4. IOS Response to Business Pressures • reduce the costs of routine business transactions • improve the quality of the information flow by reducing or eliminating errors • compress cycle time in the fulfilment of business transactions, regardless of geographical distance • eliminate paper processing and its associated inefficiencies and costs • make the transfer and processing of information easy for users

5. Types of Interorganizational Systems • Global systems • Electronic data interchange (EDI) • Electronic funds transfer (EFT) • Extranets • Shared databases • Integrated messaging

6. Global Information System • Who Uses Global Systems? • Multinational Companies • International Companies • Virtual Global Corporations • Core business activities depends on: • Goals • Basic strategies

7. Goals for International Activities • International sales • International production and sales • International product development, production, and sales

8. Basic Strategies • Multinational • Global • International • Transnational

9. Information Architecture for IOSs

10. Virtual Global Corporations • Each partner brings its core competence • Full utilization of resources • Opportunism • Spanning boundaries between organizations • IT support

11. Benefits ofGlobal Information System • Effective communication at a reasonable cost • Effective collaboration with groupware software, Group DSS, extranets, and teleconferencing devices

12. Security National Organizational Personal Technical Issues Technical standards: Software Hardware. Documents Data accuracy Security and Technical Issues

13. Sovereignty • National (use domestics products) • Economic (data to be processed within a country) • Cultural

14. Electronic Data Interchange (EDI) • Components of EDI • Data formatting standards • EDI translators • Networks • VANs • Internet

15. Start P.O. delivery Mailroom Sales Accounting Specifier Order confirmation Bill delivery Mailroom Accounting Purchasing Shipping Receiving Shipping Receiving Seller Buyer EDI transmissions Computer Generates Standardized P.O. Form Standardized PO Form • Automatic order confirmation • Approval • Prices • Availability PO PO Start Invoice Flash report • Instant data to : • Sales • Manufacturing • Engineering Automatic billing Specifier Receiving Shipping Seller Buyer Order-delivery CycleWith and Without EDI Without EDI With EDI

16. Benefits and Limitations of EDI • Benefits • Speed and volume • Accuracy • Collaboration with business partners • Profit • Disadvantages: • Cost • Customization of standards

17. Electronic Funds Transfer (EFT) • transfer of money to and from financial institutions using telecommunication networks • may be considered as an IOS, or a global system • fast - reduces delays associated with sending hard-copy documents and it eliminates returned checks • security issues

18. Extranet • A network that links business partners to one another over the Internet by providing access to certain areas of each other’s corporate intranets • Components • Intranets of business partners • Internet as communications links

19. Extranet Company A Company B Intranet corporate data, e-mail, orders, customer data, inventory, documents Internet Intranet Internet Internet Internet Other users customers, suppliers, contractors, distributors, government Corporate employees travelling or at home Extranet infrastructure • Telecommunication systems (VPNs) • TCP/IP Protocols • Internet Services • Intranets infrastructure

20. Communications options for Extranets • Long-distance dial-up access • Internet access to intranet with security • Internet access to an external server that duplicates part of the intranet data • Internet access to an external server to forward database queries to internal servers

21. Types of Extranet • A company and its dealers, customers, or suppliers • centered around one company • An industry’s extranet (Trading Network) • teamed up and created by the major players in an industry (e.g. the automotive industry) • Joint ventures and other business partnerships • used as a vehicle for communications and collaboration among several companies partnering in a joint venture

22. Benefits of Extranets • Reduce the number help-desk and data-entry employees • Improved quality of data and information exchange • Faster processes and information flow • Reduce paperwork • Improved order entry and customer service • Better communication

23. Implementing Interorganizational Information System • Security • protection mechanisms : firewalls and VPNs • Ethical and Societal Issues • takes a great risk for its trade secrets, the privacy of the employees and the controlling of some processes • Planning • complex IT planning when involving several organizations • several IT planning teams should be created and supported by e-mail, extranets,and groupware