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114 Part One Organizations, Management, and the Networked Enterprise

FEATURES OF ORGANIZATIONS

All modern organizations share certain characteristics. They are bureaucra-
cies with clear-cut divisions of labor and specialization. Organizations arrange
specialists in a hierarchy of authority in which everyone is accountable to
someone and authority is limited to specific actions governed by abstract rules
or procedures. These rules create a system of impartial and universal decision
making. Organizations try to hire and promote employees on the basis of
technical qualifications and professionalism (not personal connections). The
organization is devoted to the principle of efficiency: maximizing output using
limited inputs. Other features of organizations include their business processes,
organizational culture, organizational politics, surrounding environments,
structure, goals, constituencies, and leadership styles. All of these features
affect the kinds of information systems used by organizations.

Routines and Business Processes
All organizations, including business firms, become very efficient over time
because individuals in the firm develop routines for producing goods and ser-
vices. Routines—sometimes called standard operating procedures—are precise
rules, procedures, and practices that have been developed to cope with virtually
all expected situations. As employees learn these routines, they become highly
productive and efficient, and the firm is able to reduce its costs over time as
efficiency increases. For instance, when you visit a doctor’s office, receptionists
have a well-developed set of routines for gathering basic information from you;
nurses have a different set of routines for preparing you for an interview with a
doctor; and the doctor has a well-developed set of routines for diagnosing you.
Business processes, which we introduced in Chapters 1 and 2, are collections of
such routines. A business firm, in turn, is a collection of business processes
(Figure 3.4).

Organizational Politics
People in organizations occupy different positions with different specialties,
concerns, and perspectives. As a result, they naturally have divergent viewpoints
about how resources, rewards, and punishments should be distributed. These
differences matter to both managers and employees, and they result in political
struggle for resources, competition, and conflict within every organization.
Political resistance is one of the great difficulties of bringing about organizational
change—especially the development of new information systems. Virtually all
large information systems investments by a firm that bring about significant
changes in strategy, business objectives, business processes, and procedures
become politically charged events. Managers who know how to work with the
politics of an organization will be more successful than less-skilled managers in
implementing new information systems. Throughout this book, you will find
many examples where internal politics defeated the best-laid plans for an infor-
mation system.

Organizational Culture
All organizations have bedrock, unassailable, unquestioned (by the mem-
bers) assumptions that define their goals and products. Organizational cul-
ture encompasses this set of assumptions about what products the organi-
zation should produce, how it should produce them, where, and for whom.
Generally, these cultural assumptions are taken totally for granted and are

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