Impact of Technology

in Organization

MR. SAMUEL R. CABAÑAS

Reporter
 What is Technology?
• The Oxford English Dictionary defines
“technology” as the application of scientific
knowledge for practical purposes. The word
has origins from the Greek word
‘tekhnologia’ meaning ‘systematic
treatment’. In terms of its modern usage,
technology is a broad term referring to the use
and knowledge of humanity’s tools and crafts.
Reasons for the Introduction of New
Technology
• • to reduce costs;
• • to increase productivity;
• • to increase quality;
• • to reduce dependence on skilled labour;
• • because it always seems a good idea to be up to
date;
• • because competitor organisations are also
introducing new technology;
• • because new technology is interesting;
• • in order to change the relations between various
groups in the organisation.
Impact of Technology to Organization

• Performance and Productivity

• Usability
• Manpower Levels and
Organizational Size
• Job Enrichment vs Deskilling
Optimists and Pessimists Theory
• 1. Technical System as Control - Technology is
seen as deskilling, taking work from people and
reducing the remainder to tedious and repetitive
work.
• 2. Technical System as Tool - This view sees
technology as enriching, whereby the routine and
boring jobs are allocated to computers, which
also provide tools to allow people to be creative
and handle information in diverse and powerful
ways.
HOW INFORMATION SYSTEMS IMPACT
ORGANIZATIONS AND BUSINESS FIRMS

The Two-Way Relationship Between Organizations and

Information Technology
 Economic Impacts

• IT changes relative costs of capital and the

costs of information
• Information systems technology is a factor of
production, like capital and labor
• IT affects the cost and quality of information
and changes economics of information
 Organizational and behavioral impacts

• IT flattens organizations
• Decision-making pushed to
lower levels
• Fewer managers needed (IT
enables faster decision-making
and increases span of control)

• Postindustrial organizations
• Organizations flatten because
in postindustrial societies,
authority increasingly relies on
knowledge and competence
rather than formal positions
Increasing Flexibility of Organizations
• Information systems give both large and small organizations additional
flexibility to overcome the limitations posed by their size.

The Internet and Organizations

• The Internet increases the accessibility, storage, distribution of
information and knowledge for business firms.
• The Internet lowers the transaction and agency costs of firms.
• Businesses are rapidly rebuilding their key business processes based
on Internet technology. Example: online order entry, customer service,
and fulfillment of orders.
 POINT TO PONDER
• Employees must stop thinking that
computerization projects can in
themselves transform the
organization. Improvement of
productivity is due not only to
technology, but also to the way by
which it is integrated into the
organization.