Chapter 4

Information Technology and

The Design of Work
 Real World Examples
 In her book, “In the Age of the Smart Machine: The Future of
Work and Power”, Shoshana Zuboff studied the effects on
data clerks of a new computer system that automated
insurance claims processing.
 She discovered that the new system:
 Created confusion and workers felt distanced from the work process.
 Data lost meaning and importance.
 The clerks actually lost skills.
 The work became “mechanical”.
 This chapter should help managers understand the challenges
in designing work systems that overcome resistance to IT

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 Impact of IS on Individual
Workers
 The changing nature or work
 IT’s impact on different types of workers
 The rise of new work environments
 How IT has enabled a shift toward work that creates,
disseminates and applies knowledge
 Help managers understand the challenges in
designing work systems that overcome resistance to
IT

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 Impact of IT on Work Processes
 New IT systems, if not implemented properly, can
create confusion and alienate workers from the
work process
 Automation may increase productivity and reduce
costs, but can also lower morale and job
satisfaction, with employees feeling they are just
“pushing buttons”.

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 JOB DESIGN FRAMEWORK
How emerging IT may affect work
 What tasks will be performed?

 How will the work be performed?

 Who will do the work?

 Where will the work be performed?

 How can IS increase performance, satisfaction

and effectiveness of the workers doing the work?

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6
 HOW INFORMATION
TECHNOLOGY IS CHANGING
THE NATURE OF WORK

It alters employee life

 By creating new types of work
 By creating new ways to do traditional work
 By presenting new challenges in HRM brought
about by the use of IT
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 New Ways to do Traditional
Work
 Many traditional tasks are now done by computers,
while many work processes have been greatly changed
by the introduction of IT
 Communication patterns have changed, workers now
use mobile devices to send and receive messages and
tap into databases, greatly affecting sales and service
tasks
 The cost and time needed to access information is
dramatically lower, giving workers new tools
 Work has become much more team oriented - an effect
amplified by the Internet

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 Creating New Types of Work
 Examples of newly created jobs now
common in traditional organizations include:
 knowledge managers,
 systems analysts,
 database and network administrators,
 webmasters and web site designers.
 It has changed the organizational decision-
making process, the information used in
making decisions, plus the amount and type
of information available to workers
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New Challenges in IT HR Management
 Organizations face the challenge of managing
a workforce that is no longer in a single
location
 Work is more team oriented, making it more
difficult to assess individual contributions
 One solution is to use electronic employee
monitoring systems automating supervision,
but possibly hurting morale and undermining
efforts encourage workers to contribute their
ideas to the organization
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 Supervision, Evaluation, Compensation, Hiring
  Traditional Approach: Newer Approach: Objective
Subjective Observation Assessment

Supervision Personal. Manager is usually Electronic, or assessed by deliverable.

present or relies on others to ensure As long as the employee is producing
that employee is present and value, he does not need formal
productive. supervisions
Evaluation Focus is on process through direct Focus is on output by deliverable or
observation. Manager sees how by target. As long as deliverables are
employee performed at work. produced and/or targets achieved, the
Subjective (personal) factors are employee is meeting performance
very important. expectations adequately.

Compensation Often individually-based. Often team-based or contractually

and Rewards spelled out

Hiring Personal with little reliance on Often electronic with recruiting

computers. Often more reliance on websites and electronic testing. More
clerical skills. informated work that requires a
higher level of IT skills.

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 HOW INFORMATION
TECHNOLOGY IS CHANGING
WHERE WORK IS DONE
Ability of workers to work anywhere, any time:
 Telecommuting
 Mobile workers
 Factors that affect these trends
 Supporting technologies
 Disadvantages/ Advantages
 Managing Telecommuting and Mobile Work

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 The Growth of Telecommuting

 Telecommuting has gained popularity since the late

1990s because:
 It lowers corporate overhead. Telecommuting workers
don’t take up office space, lowering facilities costs
 Workers who are given increased flexibility are more
productive and express higher levels of job satisfaction
 2/3’s of Cisco employees occasionally work from
home.
 This has saved them $1M in overhead and increased
productivity by 25%, as workers prefer to set their own
schedules and work in more comfortable surroundings.

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Enabling Factors for Telecommuting

 3 factors support the growth of telecommuting growth:

 Work is increasingly knowledge-based so workers
don’t need to be “at work” to do their jobs.
 Telecommuting enables workers to shift their work
to accommodate their lifestyles, esp. parenting or
living in locations far from the office.
 More powerful PCs + cheap, high speed telecom
(ADSL, cable modem) mean telecommuters can
connect to corporate network efficiently.

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Driving Factors of Telecommuting
Shift to knowledge- Eliminates need that some
based work work be done in a specific place

Changing Provide workers with

demographics and geographic and time-shifting
lifestyle preferences flexibility

New technologies Make remotely performed work

practical and cost-effective 15
 New Technologies Supporting
Telecommuting & Mobile Work
 Sales and service personnel can now quote orders at
point of sale, improving customer satisfaction,
reducing sales cycle time and cutting costs.
 Roles changing due to heavy use of four
technologies: laptops, PDAs, handheld terminals and
mobile phones.
 High quality laptops are the most important and
widely used of all mobile work technologies.

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 Disadvantages of Telecommuting
and Mobile Work
 More difficult for managers to evaluate and
compensate performance
 Workers must be extremely self-disciplined
 Can disconnect them from corporate culture
 Labor unions, politicians, etc., worry about foreign
outsourcing of software development and
computer services enabled by the same
technologies

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Key Technologies in Redesigning Work
Technology Used By Impacts
Laptop computers Professionals, particularly Eliminate constraints of
consultants and salespeople travel. Enables workers to
be productive anywhere
PDAs Mostly professionals, but Provides a low-cost, simple
gaining mass acceptance way of organizing
information and data
Service professionals, Enhances productivity and
Handheld adds capabilities and real-
terminals particularly delivery, technical
support, and service and repair time communication
technicians
Any worker who travels Allows immediate voice
Portable phones during his or her work routine (and sometimes data)
communication

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 +s and -s of Telecommuting
Employee Advantages of Potential Problems
Telecommuting
Reduced stress due to increased ability Harder to evaluate performance,
to meet schedules, heightened morale, Increased stress from inability to
and lower absenteeism separate work from home life

Geographic flexibility Employee may become disconnected

from company culture

Higher personal productivity Telecommuters are more easily

replaced by electronic immigrants

Housebound individuals can join the Not suitable for all jobs or employees
workforce

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 Managerial Issues In
Telecommuting and Mobile Work
 Planning, business and support tasks must
be redesigned to support mobile and remote
workers
 Training should be offered so all workers
can understand the new work environment
 Employees selected for telecommuting jobs
must be self-starters

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 INFORMATION SYSTEMS
ENABLES MORE GROUP WORK

 Electronic Collaboration
 Groupware

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 Groupware and Electronic
Collaboration
 Groupware tools such as Lotus Notes, and
technologies, such as video conferencing
have made it cost-effective for distant
workers to create, edit and share electronic
documents and processes.
 Collaboration adds value to many types of
tasks, particularly those that benefit from an
exchange of ideas.

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 Whirlpool’s Product Design
Management (PDM) system
 PDM unites design teams electronically
using a central data repository.
 Engineers around the world collaborate
online to create several basic designs using
PDM.
 Each region then customizes generic design
for local use.
 PDM halves design time, saves money and
brings products to market more quickly.
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 Ford Motor Company

 Ford now develops cars for world markets

by electronically linking design and
engineering centers via videoconferencing
and corporate intranets.
 Faster more efficient communication allows
Ford to design and produce cars in less
time.

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GAINING ACCEPTANCE FOR IT-
INDUCED CHANGE

 To avoid resistance to change, system implementers

and managers must actively manage the change
process
 The Technology Acceptance Model (TAM) suggests
that employee attitudes may change if they think the
new system will help them to do more or better work
for the same effort, and that it’s easy to use
 Employee participation in the system’s design and
implementation also helps
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Technology Acceptance Model

Perceived
Usefulness

Attitude Behavioral Actual

External
Toward Intention System
Variables
Using to Use Use

Perceived
Ease of Use

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 FOOD FOR THOUGHT:
THE PRODUCTIVITY PARADOX
Does IS/IT Investment Improve Worker Productivity?

 Some researchers argue ongoing costs outweigh

productivity gains
 Other research suggests employee productivity is
rising
 Some argue the measurement of productivity is
flawed; e.g., fails to capture gains in service.
 Recent research suggests that heavy investment in
IT is finally paying off.
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 Productivity Paradox of IT

 IT – productivity relationship
 Investments in IT have either not increased
productivity or profitability or that gains have
been offset by inefficiencies somewhere else

 “No, computers do not boost productivity, at least not most of

the time.” (Economist, 1990)
 “we see computers everywhere except in the productivity
statistics.” (Robert Solo, Nobel Laureate economist)

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 Productivity Paradox of IT – Explained?
Mismeasurement of Inputs and Outputs

 Non-traditional sources of value not easily

measurable by traditional measures
 Product quality, timeliness, customization, variety
 Convenience and improved working conditions: not
reflected in official output data

Shortcoming in research, not practice

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 Productivity Paradox of IT – Explained?
Time Lag
 Once an IT is adopted, effect (-ive or +ive)
may not be immediate
 5 years before results show on bottom line
 Extent of time users need to become familiar / proficient
with particular IT
 New IT available every 2 years – human capital invested
in earlier IT obsolete / depreciated
 Investments in IT do not necessarily lead to increases in
firm’s financial performance (rather, long-term payoffs)
Shortcoming in research, not practice

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 Productivity Paradox of IT – Explained?
Redistribution and Dissipation of Profits
 IT may be beneficial to individual firms; effect
on industry as a whole - too slow for any
improvements to be recorded
 IT may add value to a firm’s market research
or sales promotion department: does not add
value to a firm’s total output
 Redistribution of, not increase in, benefits

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 Productivity Paradox of IT – Explained?
Mismanagement of Information and Technology
 Investments are made not in the interest of the firm
 Decisions made without up-to-date information
 Inefficient systems are built
 Lack of explicit measures of the value of information make
it vulnerable to misallocation and overconsumption
 Kocherlakota’s Theory of Relative Consumption: firms invest in IT
because other firms do
 “keeping up with the Joneses”

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 Productivity Paradox – Explained?
 Productivity, consumer value, and business profitability are
related, BUT ultimately they are separate issues.

 IT has increased productivity

 IT has created substantial value for consumers
 IT has not resulted in supranormal business profitability

 No inherent contradiction between increased productivity, increased

consumer value, and unchanged business profitability.

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