Where in the Organization Should IS Be?
Before the advent of the personal computer, the information-systems function was centralized within organizations in order to maximize control over computing resources. When the PC began proliferating, many departments within organizations saw it as a chance to gain some computing resources for themselves. Some departments created an internal information-systems group, complete with systems analysts, programmers, and even database administrators. These departmental-IS groups were dedicated to the information needs of their own departments, providing quicker turnaround and higher levels of service than a centralized IT department. However, having several IS groups within an organization led to a lot of inefficiencies: there were now several people performing the same jobs in different departments. This decentralization also led to company data being stored in several places all over the company. In some organizations, a “matrix” reporting structure has developed, in which IT personnel are placed within a department and report to both the department management and the functional management within IS. The advantages of dedicated IS personnel for each department are weighed against the need for more control over the strategic information resources of the company.
For many companies, these questions are resolved by the implementation of the ERP system (see discussion of ERP in chapter 8). Because an ERP system consolidates most corporate data back into a single database, the implementation of an ERP system requires organizations to find “islands” of data so that they can integrate them back into the corporate system. The ERP allows organizations to regain control of their information and influences organizational decisions throughout the company.