Information Systems in Organisations - Coursework Example

RDI/EDEXCEL Computing and Systems Development Level 5 BTEC Higher Nationals Assignment: Information Systems in Organisations for 13th February 2014 Student Name: Christian Gauci Student ID: STU37753 Tutor: Robert Manderson Table of Contents Table of Contents 2 1.0 Information needs of different functional areas of RBS 4 1.1 Functional areas of the RBS organisation 4 1.2 Levels of authority within RBS 7 1.3 Reason for different information needs across the organisation 9 2.0 Comparison of different information systems suitable for the different functional areas of RBS 10 2.1 Major types of information system potentially available for RBS 10 2.2 Current trends in information systems 13 2.3 Suitability of selected approach to information systems for RBS 16 3.0 Production of management information and alternative methods of problem solving 17 3.1 Generation of valid, accurate and useful information to research a Sales business performance problem at RBS 17 3.2 Alternative Methods for Solving Sales Performance Problems 20 References 23 List of Tables Table 1: Summary of IS needed at RBS 13 Table 2: Level 3 Movement Table on Sales for Middle Management 19 Table 3: Level 3 Movement Table on Settlement for Senior Management Executives 19 List of Figures Figure 1: Relationship between Functional Areas and Constituent Parts of RBS 7 Figure 2: Organisational Chart of RBS 9 Figure 3: Current trends in using information systems 16 Figure 4: Fishbone Diagram of RBS’s Alternative Methods for Solving Sales Performance Problems 22 INFORMATION SYSTEMS IN ORGANISATIONS 1.0 Information needs of different functional areas of RBS 1.1 Functional areas of the RBS organisation The Royal Bank of Scotland (RBS) operates an integrated hierarchical organisation that is made up of four major areas of functionalities which are interwoven and interlinked with each other. By essence, the role played by individuals in each of the functional areas directly affects the outcome of work of other people at other components of the organisational structure. The reason this is so is that the bank operates a functional type of organisational structure, which makes the company focus on how roles are performed at various departments rather than how independently each division operates (Shoham and Balabanovic, 2013). The four functional areas are thus given as sales and marketing, finance and accounting, human resources, and customer relations management. Between the sales and marketing functional areas, the marketers are mostly expected to undertake the role of trading out the products of the bank to the public, while the sales team draws customers out of the many pool of people drawn by the marketing team. It essence, there is a two-in-one function that focuses on drawing as many pools of customers to the bank as possible. As each of these customers comes on board the train of business operations of the bank, they are given the opportunity to select from as many products of the bank as possible (Baeza-Yates, Saint-Jean and Castillo, 2013). Another two-in-one function is played by the finance and accounting functional area of the bank, whose task can be summed at dealing with the finances of the company. As noted earlier, the bank operates a functional organisation and so has a work duty that is highly related and connected to each other. For this reason, as the sale and marketing section draws customers unto the bank and the customers invest their monies into the business of the bank, the finance and accounting team becomes tasked with ensuring that the flow of money in and out of the bank is well regulated in a manner promotes effective use of fiscal resources. Between the finance and accounting sections, there can be some level of independent service delivery in addition to the interdependence that is seen on an overlapping premise. The independence come in with relation with definition of duty, whereby the finance section is tasked with the duty of ensuring that the bank operates within profitable premise and does not run at a lost (Hayes, Andersen and Heuttner, 2013). As this is done, the accounting section acts as an evaluator of the activities of the finance section by ensuring that the financial controls of the bank are well crossed out and balanced in terms of following corporate governance principles and statutes on accounting and auditing. The resources functional area can best be described as an oversight committee that has a supervisory role over what is done in almost all other departments of the organisation. Their role starts with the recruitment and replacement of employees for various positions within all functional areas of RBS, including the human resources department. They are also responsible for ensuring that once the employees are hired by the bank, they are given everything they need to make their stay and work easier and successful for them. Human resource management is thus an important component of the functions of the human resources team. At RBS, the focus of the human resource department as reported by Billsus and Pazzani (2012) is to ensure that the human resource base of the bank is well equipped with adequate training, resources and business capitalisation that makes them competitive for the ever changing competitive market. In line with this, the focus of the human resource functional area has always been to adequately train its human resource, while ensuring that the human resource has the needed resources to make them feel at ease to produce. As noted in Ribeiro-Neto and Baeza-Yates (2012), the human resource base of the company is the engine that sparks productivity. Paying attention to them is therefore a useful way to guarantee increased productivity. Just as the human resource base of the organisation is the engine that sparks productivity, the customer base of the organisation is also the engine of capital injection (Blaschke and Valencia, 2013). Indeed, without customers, the company can hardly talk of revenue, let alone to talk about profits. This is because it is the investments that customer, including shareholders make into the bank that determines the capital pool of the bank, with which all other business operations are performed. The presence of the customer relations management as part of the functional areas of RBS is therefore a step in the right direction in ensuring that customers are not seen as an automatic part of the bank’s operations that will come to the bank through natural provisions. Rather, the mentality of the customer relations management is that the bank must be a magnet that has the potential of attracting as many customers to the bank as possible. In most cases therefore, the operations of the customer relations management starts from the point where the sales and marketing team bring in customers to the bank by introducing the products of the bank to the public and drawing customers out of the public figure. Right after the customer base is drawn the customer relations management ensures that each customer is presented with a level of quality of service that will make the customer comfortable in continuing to do business with the company. Overall, the four major functional areas form the operating core of the bank, which are further related to other constituent parts of the larger company as seen in the diagram below. Figure 1: Relationship between Functional Areas and Constituent Parts of RBS 1.2 Levels of authority within RBS Interestingly, as part of the functional organisation of the RBS, there are different levels of authority that each of the four main functional areas that have been identified earlier operates. As represented in the diagram below, instead of having different divisions under each of which the four functional areas fall, the four functional areas stand apart on its own with hierarchical levels created under each of them. As the diagram depicts, there are four main levels of authority within the RBS organisation. Each of the four operates a different level of authority for the four main functional areas. The four levels of authority are executive directors, general managers, managers, and support staff. The executive directors are always at the top of the helm of affairs, issuing the first line of orders within the various countries of operations. The executive directors are however not considered to be authoritarian because their orders are subject to scrutiny by other members on the lower levels. The general managers traditionally have deputy general managers and assistant general managers who operate under them. When classifying the organisational levels of the bank however, the separation is not made between the general managers and their deputies. General Managers take orders directly from the executive directors and reason with executive directors on orders issued. This means that orders will not go any step further below the general managers if they have not been agreed upon by the executive directors and general managers (Mulvenna and Buchner, 2012). This also means that once orders leave this level, they are considered as implementable orders. The executive directors and general managers are thus considered as decision or authority holders within RBS. This is because once orders or information come from their levels, based on consultation between the two, they must be implemented. Managers take orders directly from their general managers and act as facilitators for implementation. What this means is that it is not the managers who are obliged to directly implement or execute actions on the orders they receive from above their level. Rather, managers are obliged to harness resources needed to ensure that once the orders or authority they carry leave their levels, they will have everything it takes to successfully implement them. At RBS, managers have assistance managers but not deputy managers with assistants. This means that the decision on resources needed and how the resources can be effectively harnessed is taken between the manager and the assistant manager. Because in theoretical terms the assistant manager is close to those below the level of the manager, the assistant manager often has consultative meeting with those below the manager’s level to ensure that he is well informed about what needs to be put in place to make the execution of every piece of order coming from above successful (Chang, Cohn and McCallum, 2013). The support staffs are exclusively responsible for carrying out orders that they receive from above. By the time orders get to this level, it is known to have been initiated by the executive director, innovated by the general manager in consultation with the executive director, and harnessed by the manager. There are therefore hardly any rooms for questioning the authority of orders when they get to this point (Srivastava, Cooley and Mobasher, 2013). The question of lack of means also becomes highly raised at this point. Because of this, accountability starts at this level on every order that is released from the highest point of the levels of authority. What this means is that if a piece of order is not successfully implemented in terms of the four functional areas by the support staffs, they would have to account to their superiors, who are the managers as to why they could not implement according to specifications. The issue of questioning why orders were not successfully executed actually start with the general manager to the manager, who would then ask the support staff. Figure 2: Organisational Chart of RBS 1.3 Reason for different information needs across the organisation From the organisational chart of RBS, there are two major characteristics of the organisation that can see. These are dependence and independence. Indeed, both the functional areas and levels of authority of the company are independent and dependent at the same time. The independence come in with reference to the roles that each level and functional area plays. There is also dependence in the area of effect or outcome because if one component fails, all the other components will be affected. But by virtue of the fact that in the performance of their core roles, each functional area and level of authority operates from an independent perspective, it is important that the information needs of each sector is clearly and independently distinguished from the other. Because of the differences in roles, each functional area handles different sets of people, work variables and uses different resources for the execution of their roles. By virtue of this reason, defining a common information need for all within the organisation would be tantamount to treating stomach pain with a drug meant for headache. Another important issue is that at the levels of authority, some of the roles of people are decision making oriented, while that of others are decision implementation oriented. For such two different sets of people, the intensity of information alone cannot be measured to be the same (DeJong, 2012). It is for this reason that the information needs of various levels of authority and functional areas cannot be said to be the same. 2.0 Comparison of different information systems suitable for the different functional areas of RBS 2.1 Major types of information system potentially available for RBS Based on the four levels of authority and the corresponding four functional areas identified within RBS, there are three major types of information systems that can be available for use in the organisation. These are decision support systems, management information systems, and transaction support systems. Due to the unique nature of the organisational chart of RBS, which ensures that different levels of decisions are taken on all functional areas, the dominance with the use of the three types of information system will be emphasized for the levels of authority rather than the functional areas. An example of this is that, at the highest level of authority, one type of information system may be used for all the four functional areas. As the level comes down, the type of information system will be changed till it gets to the lowest level of authority. By implication, each functional area will experience the use of all three types of information system. This approach to the use of information system is referred to as the 3-tier integrative approach (DeJong, 2013). In using the 3-tier integrative approach to information system at RBS, the decision support system (DSS) will be assigned to the executive director and managing director levels of authority. This is because these two levels are decision oriented levels and entail top level management. Meanwhile, the decision support systems have been described as being very ideal for top level management where strategic decision making and the need to have a holistic approach to decision making is essential to bring about success to the entire organisation (Frakes and Baeza-Yates, 2012). It would be noted that once decision or orders cross the level of the executive directors and general managers, they can no longer be revoked by another authority at the levels below. For this reason, it is important that decision making can be made in such a way that captures the collective interest of the entire organisation, whether it is made for the sales and marketing department, finance and accounting department, human resource department, or customer relations department. Generally, decision support systems will be used at the top level management. In line with this, a compound DSS will be used at the top level management of RBS as it is made up of a hybrid of systems that makes it possible for major components of DSS to be achieved including inputs, user knowledge, outputs and decisions (Rzhetsky, Friedman, Kra, Yu and Krauthammer, 2013). Also as part of the 3-tier integrative approach to information system at RBS, the management information system will be recommended for the middle management level of authority, which in this case is the manager. It would be noted that a management information system is concerned with the facilitation of decision made from the higher levels (Fu, Budzik and Hammond, 2013). Meanwhile, the managers at RBS are those responsible for facilitating the decisions that come from above by ensuring that all necessary resources are harnessed to make the implementation of the decisions possible when they are pushed further down. But more specifically to the management information system (MIS), the predictive information system will be recommended for use by the managers of the bank when facilitating decisions for all four functional areas namely sales and marketing, finance and accounting, human resource, and customer relations. A very peculiar characteristic of the predictive information system is that it makes the drawing of inferences and predictions that are necessary for decision making possible (Fuhr, 2012). By implication, once they are applied by managers at RBS, the managers will have the opportunity of basing their facilitation processes on what is happening in the current global market and what is forecasted to happen. The last type of system that will be potentially available for RBS is the transaction support system, which is expected to be used at the support staff level of authority, which is described as operational core. According to Fu, Budzik and Hammond (2013), transaction support systems basically processes business transactions. This means that once any decision or order comes from the highest level of authority to the support staff level, the staff at this level will act on the orders or decision by undertaking specific processes for business transactions. Already, it has been mentioned that each of the functional areas of the bank has different information need. For this reason, based on the different information needs faced by the various each of the four functional areas will be expected to play different transaction based role as the information needs of that functional area requires. A single example of transaction support system that will be suggested for the operational core of RBS under which the support staffs fall is the decision-taking information system. This information system is selected because as Fuhr (2012) noted, it makes it possible for the support staff to freely operate within their learned mandate whiles having very little supervision or influences from those in the higher levels at the point of implementation of decisions. This means that the decision-taking information system promotes employee engagement. The types of information systems needed at RBS have been summarized in the table below. Table 1: Summary of IS needed at RBS Organisational Ranking Level of Authority Type of Information System Example of Information system Functional Area Top level management Executive Director Decision support system Compound DSS ALL General Manager Middle management Manager Management information system Predictive information system ALL Operational core Support Staff Transaction support system Decision-taking information system ALL 2.2 Current trends in information systems In order for organisations to adequately solve the problems of information needs that face them, they continue to use new trends in information systems that are basically aimed at making decision making process thorough, accurate, up-to-date, concise, and beneficial. One of the most critical current trends in information systems is to approach the application of information systems as a process rather than an event. This is done by systematically categorising components of information system delivery four major steps namely intelligence, design, choice, and review. According to Rzhetsky et al. (2013), at the intelligence stage, users of information systems, no matter the type or example of information system they are using try to undertake four major actions involving the collection, classification, processing and presentation of data. At RBS, such data could revolve around the inputs, needed for various functional areas to adequately perform their roles. For example, when using the compound decision support system to take decision about the human resource department, the executive director may need intelligence on data covering how employees should be hired. When the use of information system comes to the manager who uses management information system, intelligence may be needed on daily and monthly absenteeism summary. The support staff using transaction support system would however need intelligence on payroll processing. The second stage on the process is the design stage. This is the stage where as part of current trend, there is a distinction made between what is currently known as what may be forecasted (Frakes and Baeza-Yates, 2012). Based on what is already known alternative strategies will be outlined by the user of whatever information system that is being used to take a decision. After this, there is a forecasting of the possible outcome of each alternative. This means that users of information systems at the design stage must have the ability to predict what the impact of outcomes would be if particular options or alternatives are selected. In effect, it is a requirement that users of information system possess a foresight skill in order to conform to current trends in information system, requiring the use of the systematic process. Choice is the third stage on the systematic process, involving the selection of best alternatives made from the last stage. This stage has always been directly related to the design stage, in that the level of work done at the design stage informs the choice that is made. Apart from this, the amount of effort put into adequately exhausting all alternatives will show the efficacy of the outcome of the choice that will be made. According to DeJong (2013), three important information needed at this stage are expected scenarios, what if questions, and evaluation of alternatives. At RBS, if this new trend is adopted, it would be recommended that decision makers at the top level management engage in much consultation and research at the choice stage so that their choices do not affect the bank negatively. The last stage is the review stage, where choices made are subject to monitoring. Commonly, this is done by a quality assurance team within the organisation. A summary of the current trends in using information systems is given below. Figure 3: Current trends in using information systems Source: Babu, Singh and Sachdeva (2013) 2.3 Suitability of selected approach to information systems for RBS From table one, it would be noted that the 3-tier integrative approach to information systems where all of the three types of information system will be used for every functional area is recommended. Indeed, the suitability in this choice is that each functional area is made to have a taste of all types of information systems, ensuring that the advantages that come with each information system type transcends to all functional areas. Another reason for the suitability is that using this approach perfectly satisfies the current trend in information system, where the need to be systematic with decision making has been identified to be very critical. The 3-tier integrative approach to information system has been said to be suitable for the current trend because the fact that each level of authority would have to use a different type of information system to test the same decision means that the execution of the decision will be done in a well calculated manner rather than haphazardly. For example if while undergoing through the processes at the top level management there were lapses with the processes, because the entire systematic process repeats itself with a new type of information system at the middle management, the lapses can be addressed before coming down to the operational core, where implementation takes place. 3.0 Production of management information and alternative methods of problem solving 3.1 Generation of valid, accurate and useful information to research a Sales business performance problem at RBS Problem solving is a central part of any information system for organisations such as RBS, which are concerned with best practices that can lead to offering clients and stakeholders the best of service that meet or surpass industry standards. But to attempt to solve problems, it is first important to identify situations and places where problems exist. Indeed, a refusal to land on the right problem facing the organisation will lead to a situation where the intervention designed to solve a problem will only end up having no effect on the organisation or even compounding on the problem (Hayes, Andersen and Heuttner, 2013). Meanwhile, it is important to note that the longer problems exist unsolved, the more several their effects are felt by the larger organisation. To identify the problems of RBS therefore, it is important to put in place realistic and pragmatic methodologies that can guarantee the generation of valid, accurate and useful information. In this case, an approach to generating information to research a sales business performance problem at RBS will be targeted. Generally, the generation of valid, accurate and useful information on problems with the sales business performance of the bank will be performed by use of primary data collection approach, which requires that realistic data be collected from the field where the problem is being researched. By this, the marketing and sales department of the bank will be used as a research setting. Shoham and Balabanovic (2013) note that the use of primary research offers several research designs, which spell out the specific approach by which the researcher collects data. In this case therefore, a case study research design will be devised. As part of the case study research design, a case will first be developed. In this context, the case will be sales business performance problem at RBS. As a way of promoting convergent thinking, specific objectives, which are backed by research questions, will be asked as a way of having as many alternative variables to identifying the problems as possible. While the case study goes on, each of the variables in the specific objectives or research questions will be adequately tested. Two clear research questions that can be asked in this context are: (1) what are the factors that impede the successful completion of sales task given to the marketing and sales department? (2) In what ways can the identified problems be adequately addressed to improve productivity at the sales and marketing department? After setting the research questions, the ‘study’ aspect of the case study will begin with data collection. The data collection will be made up of three major components. The first component shall be made up of the sampling procedure, which shall require finding the right people to contact for management information in finding the problem within the sales and marketing department of the bank. The second component shall entail the designing of a research instrument, which will serve as a tool for collecting data or information. The final component shall be the data collection exercise, where the instrument is applied on the sample size. Generally, it would be expected that the sample will be made up of employees and customers whiles the instrument will be made up of interview and questionnaire. The data collection exercise will take place within the premises of the bank. As part of the data collection exercise from the respondents, it is important for them to have a fair idea of the prevailing situation at the sales component of the company, for which reason the following management information on sales performance in the last 12 months based on report from the bank’s annual report has been produced. Table 2: Level 3 Movement Table on Sales for Middle Management 2013 sales in £m Assets FVTPL Loans and advances -85 Debt securities -1,761 Equity share -80 Derivatives -120 FVTPL Asset -2046 AFS Debt securities -47 Equity shares -17 AFS Asset -64 -2110 Liabilities Deposits -195 Debt securities in issue Short positions -502 Derivatives -97 Other financial liabilities -794 Table 3: Level 3 Movement Table on Settlement for Senior Management Executives 2013 sales in £m Assets FVTPL Loans and advances -658 Debt securities -149 Equity share -22 Derivatives -653 FVTPL Asset -1482 AFS Debt securities -806 Equity shares -1 AFS Asset -807 -2289 Liabilities Deposits -4 Debt securities in issue -2 Short positions Derivatives -165 Other financial liabilities -171 3.2 Alternative Methods for Solving Sales Performance Problems Having used generated management information for stakeholders involved, it is necessary to attempt to solve the problem identified as showed in the second research question. At this point, emphasis will be laid on the continuous use of convergent thinking, which seeks to widen the pool of thinking by bringing on board as many alternative methods of solving the problem as possible. In the instance of RBS, three major alternative methods are presented for critical reasoning and decision making. The methods are mentorship, brainstorming and use of mind map. Indeed, these three method can best be described as techniques aimed at finding long-lasting solutions to the problems identified, which in the case above, can be identified to be declining sales. On the use of mentorship, Shoham and Balabanovic (2013) recommends that the management can have a model of sales performance that worked perfectly and produced expected results. This could be from within the organisation or without the organisation. From within, archives can be searched for old methods, strategies or policies that worked best in producing desired results. After landing on this, the model could be used as a mentor by replicating what it entails. Brainstorming is also a more open ended approach to finding solutions. This would be used by bringing on board as many stakeholders and opinion holders within the bank as possible. The task of these people would be very simple and straight forward and that would be to bring together as many ideas, thoughts, alternatives, options, and criticism as possible. As part of the brainstorming, all entries will be regarded as relevant as possible. As the mind sharing exercise goes on, eliminations of alternatives will be taking place in very gradual manner until that time that the whole team settles on the best solution to the problem. The last method which is the use of mind map is a more practical and pictorial approach to solving the problem. Like the brainstorm, this would involve putting up as many alternatives as possible. However, this time round, the creative idea creation will be done by only a few people if not one person. There would then be a diagrammatic representation of the mapping done, showing up four major questions asked on the solution to the problem. Each of these four questions would be subsequently expanded into branches, using as many sub-branches as possible. Based on the outcomes of each cardinal point in the map, a solution is selected. The use of fishbone diagram is an alternative to the mind map. But in comparison with the remaining alternatives, the use of brainstorming would be suggested for RBS due to the way it brings on board as wide variety of knowledge, skills, experiences and competence as possible. An example of how a fishbone diagram can be used to address the situation is given below. References Figure 4: Fishbone Diagram of RBS’s Alternative Methods for Solving Sales Performance Problems References Babu A. R, Singh Y. P. and Sachdeva R.K. 2013. 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