International MIS

The International Dimension

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Study Questions

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Q1: How does the global economy affect organizations and processes?

Q2: What are the characteristics of international IS components?

Q3: How do inter-enterprise IS facilitate global supply chain management?

Q4: What are the security challenges of international IS?Q5: What are the challenges of international IS management?

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Q1: How Does the Global Economy Impact Organizations and Processes?

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• After World War II, Japanese and other Asian countries increase manufacturing

• Fall of Soviet Union opened economies of Russia and Eastern Europe

• N. American and European economies integrated

• Plentiful, cheap telecommunications

• Booming economies: India, China, Brazil

• EU- and U.S.-based companies find greatest opportunities outside own national markets

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Percent of Cross‐Border Commerce: Opportunities Abounds

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Organizational Strategy Determines Information Systems

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How Does the Emerging Global Economy Change Competitive Strategy?

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• Impact of Internet

• Wider range of customers

• Wider range of vendors

• Facilitates new entrants

• Intensifies rivalry

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How Does the Global Economy Change Competitive Strategy? (cont'd)

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• Accelerates flow of data about price, product, availability and service

• Products localized to language and culture

• Internet supports unprecedented market size and product differentiation

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How Does the Global Economy Change Value Chains and Business Processes?

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• Value chain activities can be performed anywhere

• Final product frequently distributed throughout world

• Abundance of low-cost, well-educated, English-speaking professionals allows outsourcing service and support functions

• Ability to work 24/7 by moving work into other time zones increases productivity

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Q2: What Are the Characteristics of International IS Components

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1. Hardware – sold worldwide

2. Software and interfaces – in multiple, local languages

3. Data – choosing language(s) for data descriptions and remarks

4. Procedures – reflect local cultural values and norms

5. People – job descriptions and reporting relationships appropriate to culture

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What’s Required to Localize Software?

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What’s Required to Localize Software? (cont'd)

• Localizing programs much more difficult, expensive, and time consuming than translating documents

• Plan for localization from the beginning

• When considering acquisition of a company in a foreign country, budget time and expense for localization of information systems

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What Are the Problems and Issues of Global Databases?

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• Commit to a single company language

• Single database not possible for companies using multiple languages

• Need applications to export and import data among separated databases

• Slow data transmission speeds may require distributed, partitioned databases and highly skilled personnel

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Types of Distributed Database Processing

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• Distributed database– Single database resides in multiple locations

•Replicated database– Multiple copies of a database distributed– Updating requires highly skilled personnel

•Partitioned database– Database divided into non-overlapping segments

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Challenges of International Enterprise Applications

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Independent Functional Systems

Inherent Processes

Unnecessary to accommodate language, business, and cultural differences

Differences in language, culture, norms, and expectations

Requires adequate data interface

Developing and evaluating “as is” models and alternative international processes incredibly challenging

Integrated, cross-functional, international system with high-level processes connected by SOA standards and the cloud

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Advantages of Functional Systems

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• Lack of integration can have advantages for international organizations and international systems

• U.S. order-processing systems operate in English, reflect practices and culture of U.S.

• Taiwanese manufacturing information systems operate in Chinese and reflect business practices and culture of Taiwan

• Need adequate data interface between two systems

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Problems of Inherent Processes

• Some inherent processes may conflict with cultural norms

• Very difficult to convince employees to follow those inherent processes, or more difficult in some cultures

• Future inter-enterprise business processes will be defined to document service responsibilities of each international unit

• The cloud and Web service standards used to connect services into an integrated, enterprise, international system

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Q3: How Do Inter-enterprise IS Facilitate GlobalSupply Chain Management?

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Supply Chain Example

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Importance of Information in the Supply Chain

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Global information systems increase supply chain profitability by:

• Reducing inventories

• Reducing or eliminating bullwhip effect

• Producing comprehensive, accurate, timely information

• Choosing delivery option that optimize value

• Enabling 24/7 global shipment tracking

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Example of Walmart Supply Chain

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How Can Information Relieve the Bullwhip Effect?

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Eliminate Bullwhip Effect with True Demand Information

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Q4: What Are the Security Challenges of International IS?

• Legal Environment– Encryption is illegal or highly restricted in many countries– Censorship problems with stored content– Dozens of countries regularly block access to certain

Internet companies – Variations in privacy laws– Intersection of international law and technology forcing

organizations to carefully evaluate how they manage their information systems and location of their data

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Q4: What Are the Security Challenges of International IS? (cont'd)

• Physical Security– Threats to infrastructure in the form of natural

disasters, geopolitical risks, civil unrest, terrorist attacks

– Physical infrastructure vulnerable to outright seizure– Employees who run critical infrastructure can be

targeted

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Q4: What Are the Security Challenges of International IS? (cont'd)

• Cultural Norms– Bribery in some countries is expected– Graft is a worldwide problem

Risks control of separation of duties and authorities Risk loss of valuable intellectual property

– Personal references: may be considered exceedingly rude to talk about someone when he or she is not present

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Q5: What Are the Challenges of International IS Management?

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International information systems larger, more complex

International IT depts. bigger, more cultures,

languages

More IT assets, risks, greater uncertainty

Complex international law, security incidents

complicated to investigate

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Why Is International IS Development More Challenging?

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Hardware• Running hardware in different countries is not a

problem, especially using the cloud

Software• Localizing software is manageable, assuming

programs designed to be localized

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Why Is International IS Development More Challenging? (cont'd)

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Data• Databases pose more difficulties • Single database used, can it be distributed? If so,

how will updates be processed? What language, currency, and units of measure will be used to store data? If multiple databases used, how will data be transported among them?

• Cloud-based databases reduces difficulties

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Why Is International IS Development More Challenging? (cont'd)

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Procedures• Customers in different countries treated differently than in U.S.

– Procedures for using a CRM correspondingly different• If underlying business processes differ, then specific requirements

for information system will differ• Options– Either define a set of standard business processes or – Develop alternative versions of system to support different

processes in different countries

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What Are the Challenges of International Project Management?

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What Are the Challenges of International Project Management? (cont'd)

• Managing costs in different countries and cultures paying vastly different labor rates

• Quality and human resources more complicated for international projects. Quality standards vary among countries

• Worker expectations vary among cultures and nations– Compensation, rewards, and work conditions vary– Can lead to misunderstandings, poor morale, and project delays

• Language and culture differences and geographic separation make communication more difficult and expensive

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What Are the Challenges of International IS Management?

1. Conducting operations in different countries, cultures, and languages adds complexity

2. Dozens of different inventory systems used throughout the world to coordinate and integrate

3. Information systems to be integrated with outsource vendors’ information systems, for different systems, all over the world

4. Protecting IS and IT infrastructure

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How Does the International Dimension Affect Computer Security Risk Management?

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• IT assets subject to more threats– Political threats, civil unrest, terrorists, natural disasters

• Likelihood of a threat more difficult to estimate

• Uncertainty about risks high

• Human safeguards chosen and evaluated on a culture-by-culture basis

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Setting Up Information Systems in Foreign Offices

• Obtain hardware and networking equipment from the local economy

• Purchase or lease a facility, local vendors supply and set up hardware, a local area network, and access to internet

• Bring in own IT professionals to install software

• Use same accounting software and chart of accounts, and same business processes, worldwide

• Twice a year conduct internal audits to verify compliance

• Allow transactions in local currency

• ERP system centralized database in home country

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Active Review

C o p y r i g h t © 2 0 1 6 P e a r s o n E d u c a t i o n , I n c .

Q1: How does the global economy affect organizations and processes?

Q2: What are the characteristics of international IS components?

Q3: How do inter-enterprise IS facilitate global supply chain management?

Q4: What are the security challenges of international IS?Q5: What are the challenges of international IS management?

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