Chapter 9

Global Information
Systems

GROUP 1

ALFARO AYA-AY
AMPONIN BALONDO
ANASTACIO
Why Go Global?

 Customers demand  Airline reservation

integrated worldwide
services systems
 Example: Shoe Company  Global products
 2008 Coca-Cola  Manufacturer might
Company
“regionalize” operations
 Prerequisites to the
success of a global  Globalization
information systems
 Global Information Systems at
Rohm & Haas

 Part of Dow Chemical

 Production units in many different countries
 Overhauled its global information system
 Can now provide better service to its customers
  E-BUSINESS

 THE INTERNET
E-Business: A
Driving Force
 Small
companies can
conduct
business online
just as large
companies
Global Information Systems: An
Overview

 Global Information System (GIS)

 International Company
 Strategic planning is a core function
Global Information Systems: An
Overview
 Control requires:
 Centralized architecture for
data,
 Standardized definitions used
across the organization
 Standard formats for reports
 Defined behaviors for different
processes
 Performance-tracking system
Coordination requires:
 Decentralized architecture for
data
 Standardization within
departments
 Ability to communicate these
standards to other departments
 Collaboration systems
 Technologies that support informal
communication and socialization
Components of a
Global Information System

 Basic Components
 Large versus small companies
 Information system manager
 Technical challenges in GIS design:
- Designing and implementing global databases
 Transborder data flow (TDF)
- Restricts what type of data can be captured and transmitted
Requirements of Global Information
Systems

 Must be capable of supporting complex global decisions

 Multinational corporations (MNCs)
 Environment includes many variations in different forces
- Legal
- Cultural
- Economic
- Political
Requirements of Global Information
Systems
Operational Requirements :
 Global data access
 Consolidated global reporting
 Communication between
headquarters and subsidiaries
 Management of short-term foreign
exchange risks
Strategic Requirements :
 Strategic planning support
 Management of conflicts and political
risks
 Management of long-term foreign
exchange risks
 Management of global tax risks
Goals of Global Information Systems

Issues :
 Identify business opportunities in
global marketplace
 Justify investment in GIS
 Information systems personnel must
have technical and business expertise
 Coordinate migration carefully
Categories :
 Intelligent systems
 Transnational management support
systems
 Global competitive systems
 Organizational Structures and
Global Information

 Four commonly accepted types of global organizations :

 Multinational
 Global
 International
 Transnational
Multinational Structure

 Production, sales, and marketing are decentralized

 Financial management remains the parent’s
responsibility
 Example: Tyco Corporation
 Focus on local responsiveness
 Each subsidiary operates on a different platform
Global Structure

 Highly centralized information system

 Subsidiaries have little autonomy
 Sometimes called a “franchiser”
 Extensive communication network necessary
 Difficult and impractical
 Examples:
 McDonald’s
 Mrs. Fields’ Cookies
 General Motors
International Structure

 Operates much like a multinational corporation

 Information systems personnel are regularly exchanged among locations
 Example: Caterpillar Corporation
Transnational Structure

 Parent and all subsidiaries work together in designing policies, procedures,

and logistics
 Usually focuses on optimizing supply sources and using advantages
available in subsidiary locations
 Architecture requires a higher level of standardization and uniformity for
global efficiency
 Example:
 Citigroup
 Sony
 Ford
Global Information Systems Supporting
Offshore Outsourcing

 Offshore outsourcing
 Organization chooses an outsourcing firm in another country
 Used for many information technology tasks
 GIS plays an important role in supporting offshore outsourcing
The Internet and Globalization in
Action

 The Internet allows entrepreneurs in developing countries to start and

expand businesses without making large investments
 Muhammad Hassaan Khan, a young entrepreneur, established a design
and consulting business called Zuha Innovation that is based in
Faisalabad, Pakistan
 As Adam Toren, president of YoungEntrepreneur.com, puts it, “The Internet
brings all continents, races, cities, and villages together in a global network
of trade and communications”
Obstacles to Using Global Information
Systems

 Lack of standardization
 Cultural Differences
 Diverse regulatory practices
 Poor telecommunication infrastructures
 Lack of skilled analysts and programmers
Lack of standardization

 Lack of international standards impedes

developing a cohesive system that’s capable of
sharing information resources across border
 Too much standardization can prevent flexibility in
responding to local preferences and even time
differences
 Only 5% to 15% of a company’s applications are
truly global in nature
Cultural Differences

 Include differences in values, attitudes, and

behaviors
 Views on using technology
 Cultural issues
Diverse regulatory practices

 Applies to policies on business practices and

technological use
 Many countries restrict the type of hardware and
software
 Jurisdiction issues on contents of a GIS
 Nature of intellectual property laws
 Privacy and cybercrime laws
 Censorship and government control
Poor telecommunication
infrastructures

 Consider telecommunication infrastructures of

the counties where subsidiaries are located
 Differences in telecommunication systems
make consolidating them difficult
 Differences in standards
Lack of skilled analysts and
programmers

 Severe shortage of qualified information

systems professionals in the United States and
Western Europe
 Companies must consider the nature of each
culture and differences in skills in other
countries
 Training and certification programs
  Factors contribute to the
SUMMARY globalization trend
 Global information systems:
 Components
 Requirements
 Uses in multinational structures
 Applications
 Obstacles