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Chapter 1 Information Systems in Global Business Today 49

Organizations have a structure that is composed of different levels and
specialties. Their structures reveal a clear-cut division of labor. Authority and
responsibility in a business firm are organized as a hierarchy, or a pyramid
structure. The upper levels of the hierarchy consist of managerial, professional,
and technical employees, whereas the lower levels consist of operational
personnel.
Senior management makes long-range strategic decisions about products
and services as well as ensures financial performance of the firm. Middle
management carries out the programs and plans of senior management,
and operational management is responsible for monitoring the daily activi-
ties of the business. Knowledge workers, such as engineers, scientists, or
architects, design products or services and create new knowledge for the firm,
whereas data workers, such as secretaries or clerks, assist with scheduling
and communications at all levels of the firm. Production or service workers
actually produce the product and deliver the service (see Figure 1.6).
Experts are employed and trained for different business functions. The major
business functions, or specialized tasks performed by business organizations,
consist of sales and marketing, manufacturing and production, finance and
accounting, and human resources (see Table 1.2). Chapter 2 provides more
detail on these business functions and the ways in which they are supported by
information systems.
An organization coordinates work through its hierarchy and through its
business processes, which are logically related tasks and behaviors for accom-
plishing work. Developing a new product, fulfilling an order, and hiring a new
employee are examples of business processes.
Most organizations’ business processes include formal rules that have been
developed over a long time for accomplishing tasks. These rules guide employ-
ees in a variety of procedures, from writing an invoice to responding to customer
complaints. Some of these business processes have been written down, but others

FIGURE 1.6 LEVELS IN A FIRM

Business organizations are hierarchies consisting of three principal levels: senior management, middle
management, and operational management. Information systems serve each of these levels. Scientists
and knowledge workers often work with middle management.

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