Notes of MGT 300 Information Technology in Business: CHAPTER 5

Chapter 5 – Organizational Structures that Support Strategic Initiatives

ORGANIZATIONAL STRUCTURES

Ø Organizational employees must work closely together to develop strategic initiatives that
create competitive advantages.

Ø Ethics and security are two fundamental building blocks that organizations must base their
businesses upon.

INFORMATION TECHNOLOGY ROLES AND RESPONSIBILITIES

Ø Information technology is a relatively new functional area, having only been around formally
for around 40 years.

Ø Recent IT – related strategic positions:

- Chief Information Officer (CIO)

- Chief Technology Officer (CTO)

- Chief Security Officer (CSO)

- Chief Privacy Officer (CPO)

- Chief Knowledge Officer (CKO)

Chief Information Officer (CIO) – oversees all uses of IT and ensures the strategic alignment of IT with business goals and objectives.

- Broad CIO functions include;

ü Manager – ensuring the delivery of all IT projects, on time and within budget.ü Leader – ensuring the strategic vision of IT is in line with the strategic vision of the
organization.ü Communicator – building and maintaining strong executive relationships.ü Average CIO compensation by industry

Industry	*Average CIO Compensation*
Wholesale/Retail/Distribution	$ 243,304
Finance	$ 210,547
Insurance	$ 197,697
Manufacturing	$ 190,250
Medical/Dental/Health Care	$ 171,032
Government	$ 118,359
Education	$ 93,750

Ø What concerns CIOs the most

Percentages %	*CIOs Concerns*
94	Enhancing customer satisfaction
92	Security
89	Technology evaluation
87	Budgeting
83	Staffing
66	ROI analysis
64	Building new applications
45	Outsourcing hosting

ü Chief Technology Officer (CTO) – responsible for ensuring the throughput , speed, accuracy, availability and reliability of IT

ü Chief Security Officer (CSO) – responsible for ensuring the security of IT systems

ü Chief Privacy Officer (CPO) – responsible for ensuring the ethical and legal use of information

ü Chief Knowledge Officer (CKO) – responsible for collecting, maintaining and distributing the organization’s knowledge

THE GAP BETWEEN BUSINESS PERSONNEL AND IT PRSONNEL

Ø Business personnel possess expertise in functional areas such as marketing, accounting and
sales

Ø IT personnel have the technological expertise

Ø This typically causes a communications gap between the business personnel and IT personnel

IMPROVING COMMUNICATIONS

Ø Business personnel must seek to increase their understanding of IT

Ø IT personnel must seek to increase their understanding of the business

Ø It is the responsibility of the CIO to ensure effective communication between business personnel
and IT personnel

ORGANIZATIONAL FUNDAMENTALS – ETHICS AND SECURITY

Ø Ethics and security are two fundamental building blocks that organizations must base their
businesses on to be successful

Ø In recent years, such event as the 9/11 have shed new light on the meaning of ethics and
security

ETHICS

Ø Ethics – the principles and standards that guide our behavior toward other people

Ø Privacy is a major ethical issues;

ü Privacy – the right to be left alone when you want to be to have control ever your own personnel
possessions and not to be observed without your consent

Ø Issues affected by technology advances

Intelligent property	Intangible creative work that is embodied in physical form
Copyright	The legal protection afforded an expression of an idea, such as a song, video game and some types of proprietary documents
Fair use doctrine	In certain situations, it is legal to use copyrighted material
Pirated software	The unauthorized use, duplication, distribution or sale of copyrighted software
Counterfeit software	Software that is manufactured to lock like the real thing and sold as such

Ø One of the main ingredients in trust is privacy

Ø Primary reasons privacy issues lost trust for e-business

1.	Loss of personnel privacy is a top concern for Americans in the 21st century
2.	Among Internet users, 37 percent would be “a lot” more inclined to purchase a product on a websites that had a privacy policy
3.	Privacy/security is the number one factors that would convert Internet researchers into Internet buyers

SECURITY – HOW MUCH WILL DOWNTIME COST YOUR BUSINESS??

Sources of Unplanned Downtime
Bomb threat	Hacker	Snowstorm
Burst pipe	Hail	Sprinkler malfunction
Chemical spill	Hurricane	Static electricity
Construction	Ice storm	Strike
Corrupted data	Insects	Terrorism
Earthquake	Lightning	Theft
Electrical short	Network failure	Tornado
Epidemic	Plane crash	Train derailment
Equipment failure	Frozen pipe	Smoke damage
Evacuation	Explosion	Fire
Power outage	Vandalism	Rodents
Power surge	Vehicle crash	Virus
Sabotage	Fraud	Water damage (various)
Flood	Shredded data	Wind