MIS 495 Extending the Enterprise

1
MIS 495Extending the Enterprise

• Dr. Steve RossWinter 2008

Based on Chapter 3 of Applegate, Austin, and
McFarlan, Corporate Information Strategy and
Management, 7th ed., 2007.
2
The Network

• At the most basic level, organizations and the
  industries and markets within which they operate
  can be defined as networks of specialized nodes
  (units) that work together to achieve a common
  purpose. (p. 80)
• A single organization or many?

3
Two Design Goals

• Differentiation
• Why do we subdivide?
• Operating units, power/authority levels,
  geographic or product groups
• Integration
• Why must we integrate?
• Task-based
• Information- or expertise-based
• Social relationships

4
Differentiation Unit Groupings

• Bases of differentiation
• Functions performed
• Products or services
• Customer or geographic markets

5
Integration Interdependencies and Relationships
among Nodes

• Organizational governance models
• Market
• Hierarchy
• Partnership

6
Ownership of the Network

• Owned (primarily) by one corporation
• Alliance of a small number of players
• Community of players

7
Governance Choice

• Market greater efficiency and effectiveness
  unless cost and risk of mechanisms to coordinate
  and control too high
• Hierarchical when high levels of uncertainty or
  unequal power increase risk of market failure

8
Collaborative Community

• Shared purpose and values ? ethic of
  contribution
• Organizational configuration ?horizontal
  relationships among peers
• Interdependent identity ?active participation
  and affiliation

9
Evolution ofPartnerships and Trust

• Process-based trust
• Recurrent transactions
• Affiliation-based trust
• Feelings of identity with the group
• Institution-based trust
• Formal organization and social structures

10
Building a Collaborative Community

• Hybrid forms of governance are emerging that
  unite hierarchy, market, and partnership
• A network orchestrator role is emerging to
  coordinate interdependencies
• Network orchestrators design organizational
  solutions that reflect the interests of all
  parties
• Collaborative community and trust co-evolve over
  time (pp. 96-98)