Wednesday, September 30, 2009

What role does the organizational culture play in IS investments?

I think organizational culture plays a very large part in any aspect of an organization including IS investment. Organizational culture is the psychology, attitudes, experiences, beliefs and values that are shared by the people within the organization and may or may not mirror the corporate culture. The culture that is present in an organization should be reflective of the strategy and goals of the organization and be supportive of the corporate culture, however this is not always the case. Organizational culture is not easy to change quickly as it has developed over many years, so it would be difficult to suddenly value some attribute that wasn't highly thought of before even if it is suddenly supported by management and business needs.

For example, I'm currently working on a project with a company that does not have a culture that supports and values innovative approaches to its operational challenges. The result is that there is an extra hurdle to overcome to justify new improvements like a computerized purchasing system because these types of improvements are not seen as necessary by the culture. The IS change is viewed with disdain and skepticism among the staff and even some management. The result is that it is going to be much more challenging to obtain buy-in and wide support for the project, and this could have negative impact and may delay implementation or impair the success of the system overall.

However, in companies like Harrah's, which has a culture that is innovative and technologically astute, it becomes much easier to deploy new technologies such as the interactive mobile gaming platform or the customized CRM capabilities metioned in the video that provide individualized content and special offers based on the customers preferences and spending habits. Harrah's is continuously striving to provide richer gaming experiences for their guests over the entire enterprise and must be innovative to differentiate themselves from other entertainment providers, even testing new innovations internally to obtain feedback from guests and employees. This aspect is part of their organizational and corporate culture and supports and welcomes new IS ideas and investments.

Another example come from Jonathan Heiliger, vice president of technical operations at Facebook when he mentions a way that innovation is supported institutionally by conducting nighttime "hack-a-thons" every other month to encourage new applications or features during off hours. Through this process a new chat app was developed and added to FB which allows users to conduct chat sessions during their time online. It is through the supportive organizational culture which embraces new IS investments and innovations that has enabled Facebook to grow to over eighty million users today.

In short, organizational culture provides an great deal of influence in any business decision including IS investments. It is very important for management to consider the culture and how it will impede or assist the IS investments within the organization.

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