1.9 Information and Decision Making
This needs feedback on the action taken and back. It requires a problem definition, a decision maker and a feedback loop.
Implicit here would be that there is data available about goals to create this feedback loop and have measurements in place (balancing loop). This is often called negative feedback because you convey information on how it is not desired.
Positive information would lead to more of whatever is going on which now includes a vicious and virtuous cycle (compound interest).
Positive = responding to change
Negative = maintaining control and stability
You need to remember that there might be a delay in both information delivery and action taken. This can lead to overshooting (interest rates lowered to fast) or oscillation (adjust water temperature). This delay needs to be minimized to make the process manageable.
Defining the information requirements requires knowing what is needed when, where and by whom.
Generic types of information:
\- Internally generated and externally gathered
\- Formal or informal
\- Ad hoc or regular
\- Human, textual, electronic
\- Degree of subjectivity
The problem is to balance external focus and internal control (e.g. car)
In deploying IT you should focus on what those who will be using it need rather than what the technology can do. A good approach is critical success factors.
The critical success factor method focuses on individual managers and on each manager’s current information needs both hard and soft. It provides for identifying managerial information in a clear and meaningful way. Moreover, it takes into consideration the fact that information needs will vary from manager to manager and that these needs will change with time for a particular manager. — Rockart. 1979
They are the few key areas where things must go right for the organisation to flourish. Rockart believed that there are usually three or sex and they are closely linked to organisational goals.
You go from Identifying critical success factors (CSF) which identify key decisions (KD) related to these factors. Then you identify information requirements (IR) for those key decisions.
In assessing performance Sears noticed that there is a chain of cause and effect running from employee behaviour to customer behaviour to profits and all this depends largely on attitude which, for the employees, is a mix between attitude about the job and attitude about the company.
The performance of the information itself might be judged by quality criteria (relevance, reliability, robustness).
The performance can be judged by looking at the process (gathering, analysing, communicating and storing) and looking at possibly gaps to the optimum. A gap analysis can work with the help of a critical success factor system first looking at expectations and then at perceptions.
The most relevant forms of power here is resource power and position power as information is increasingly seen as a valuable resource and you might be in a position to influence the flow of power. IT will affect the power balance at all levels.
Davenport et al suggest 5 models
Technocratic utopianism
Technology approach dominates but not technology can convince sharing if it is not wanted.
Anarchy
More centralised approaches brake down or no key executive has seen the importance
Feudalism
Most often encountered; individual execs and departments control acquisition, storage, distribution and analysis. Leads to fragmenting; flourishes in places with strong divisional authority.
Monarchy
Most practical, CEO dictates strategy
Federalism
Preferred model, use of negotiation to bring potentially competing and non cooperating parties together.