Information System & Organization

Master IREN

« Information Systems & Organization »

Henri Isaac, Associate Professor

PSL, Université Paris-Dauphine
Henri.isaac@dauphine.psl.eu
@hisaac25

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 Who am I?

More information
– http://fr.linkedin.com/in/henriisaac
– https://www.dauphine.fr/fr/recherche/enseignants/detail-
cv/profile/henri-isaac.html
– http://www.twitter.com/hisaac25
– http://www.slideshare.net/hisaac25

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 How do you understand this?

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 Platforms everywhere

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 Digital Ecosystems

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 From a hierarchical structure towards a networked structure

Traditional Platform
company

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 Platform: a first look

Networked world Networks effects Ecosystem Value cocreation

Platforms

Datafication Data-driven connected Value cocreation

algorithms user

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 Is platform the definitive type of organization?

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 Zero transaction cost economy

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 Information System & Organization

• Learning goals:
– Understand the role of IT in IS reshaping
– Undertstand the role of IS in organization reshaping
– Understand the evolution of management in this context
– Reframing the theoritical landscape.
• Methods:
– Teaching and discussions
– Readings of research articles

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 Syllabus: details

1) Introduction : a digital economy.

1) What is digital transformation
2) What is an information technology?
3) What is an information system?
4) What is management?

2) Two core technologies transformation reshaping the firm:

1) From ERP to EAI to API
2) From CRM to open customer communities

3) What is a digital company?

1) Market, Firm, Systems
2) Which framework to understand the platformed company
3) Strategizing in a platform world
4) Managerial skills for the platformed company.

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 INTRODUCTION

A digital economy
•What is an information technology ?
• What is an information system ?
• What is management ?

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 Introduction
from service economy to digital economy: a value shift

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 Introduction : value in a digital world

Value creation Resources Work organization

classical services Resources Individual skills

Servicization of the
economy exploitation
Ex : car renting outsourcing

Service Personalized services Interconnected Exploitation of

economy value chain collective knowledge
Ex : luxury hotels

Building a Dynamic re- Exploitation of

Digital economy personalized solution allocation of distribued knowledge
by the customers resources interconnected by
interconnected by electronic networks
electronic
networks
Digital value
Ecosystems of Digital work
Digital interactions
resources
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 Digital Transformation

§ Combination of two phenomena:

§ the widespread interconnection of people, goods and information
through networks and multiple connectivity technologies
§ the datafication of the world which is only an extension of its
mathematization which is secular

§ Consequences of these two phenomena on the:

§ Individuals and their social and market relations
§ Mechanisms for value production
§ Institutions and their legitimacy mechanisms

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Digital revolution characteristics

Big data Serendipity

Datafication Networks Systems
Extension of
world’s Collective
mathematization Intelligence

Artificial
Intelligence
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 Digital transformation & value creation

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 Networks effects Generalization

1
9

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 Demand-side economy of scale

Standard Product Economy of scale Demand-side economy of scale

Price
Demand
Demand
Demand
Offer offer

offer

Quantity

Increasing average cost Decreasing average cost Decreasing average cost

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 Characteristics of a digital economy

• Digitalization of resources
• money, sound, image, text, economic activity, value

• Fundamentals resources : intellectual capital vs physical capital.

• Raw materials: data
• Data as an infinite & non rival good
• Resources interconnected by electronic networks
• Network effects adding new fundamentals at managing
economy of scale

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 Wrap up

• Digital economy
• Digital economic value (use value & idiosyncrasic)
• Virtual resources (access versus ownership)
• Virtualization of work (cognition/distribution)
• Digital interfaces of economic interactions
• Digital company (i.e., platform)
• Extended: not necessary owner of the resources
• Ecosystem including the usersa spart of the system
• Dynamic system : dynamic reconfiguration linked to the
evolution of demand (≠ flexible)
• Digital: interconnected networks of resources

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 INTRODUCTION

• a digital economy
•what are information technologies?
• what is an information system?
• what is management?

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 Introduction ICT, definitions

New information technologies

« a label that reflects the convergence of different trends in technological
development, including micro-electronics, computer science,
telecommunications, software ingeeniering and systems analysis »
(A. Zuboff, 1988, In the Age of the Smart Machine: The Future of Work and Power)

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 The rise of the smart machine

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Omnipresence

process
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Pervasive
computing
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mie

networks

Ubiquitous
Interface CPU Memory computing
networks
Networked
computing

Interface CPU Memory

Interface CPU Memory
Birth of
computing

autonomy
1960 1970 1990 2000
© H. Isaac Adapté de Waldner, [2006], “Nano-informatique et intelligence ambiante”
 In the age of smart machine

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 Internet of Things

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 Transformation of computing

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 Towards the platformed company

Suppliers
Pivotal company
Business Port Client

client

Suppliers client

Business Port Business Port

Business Port

Business Bus (API, SDK, Web services)

Business Port Business Port Business Port Business Port

Recommandation Transport Service financier Store locator
Target2sell UPS Paypal Evoke
Business Port Business Port Business Port
searchandising Avatar CRM Mapping Service
Sparkow iAdvize Google

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 IT Artefact

IaaS / PaaS
SD-Networks
Everything as a Service
Serverless
Edge Computing

Infrastructure Services
DATA

Applications Contents
SaaS User Generated
API Orchestration Content

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 IaaS, PaaS, SaaS

• Network
• Storage
• Servers
Infrastructure
As A Service • Virtualization

• IaaS
• OS
• Middleware
Platform As A
Service • Runtime

• IaaS+ PaaS
• Data
Software As A • Applications
Service

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 From descriptive to prescriptive

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 Machine learning heavily relies on data

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A first approach of platform

Users, partners sub-system

Digital technical
sub-system

Data sub-system

(S. Choudary 2015)

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(another) first approach

Cocreation
Innovation

Information
System
Architecture

Data

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A global approach of platforms

Business model
Innovation System

Communities, Networks, Marketplace

Infrastructure

Data

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 Data

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 Data, information, Knowledge

Belief

Knowledge

Information

Data

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 Data, information, Knowledge

Data

Core competencies

Processing Exploitation

Informations Global knowledge

Local knowledge at the organization
General
level
Diffusion
distribution

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 Data, information

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 Information system

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Variety of data

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Typology of personal data

Individual him-self Traces

§ Formulars § Explicites (transactions, etc.)
§ Expressions &links § Implicites (passage, usage)
§ Life logging Quantified-self § Surveillance
§ Outsourcing (cloud)

Personal Data

Others
§ Links, contacts Historical data brokers
§ Tags § Data brokers
§ Comments § CRM
§ Reputation § Database entries

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 First-party, second-party, third party data

Brand Publisher Third-party

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 Typology of digital marketing data

• First Party Data

– CRM data, such as user registrations
– Site-site data, including visitor history
– Self-declared user data (income, interest in a product)
• Second Party Data
– Ad serving data (clicks, views)
– Social signals from a hosted solution
– Keyword search data through an analytics platform or campaign
• Third Party Data
– Audience segments acquired through a data provider

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 What are data all about ?

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Data a non-rival good, infinite resource

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 Data, a non rival good

A non-rival good is a good (or service)

whose consumption by one individual
does not deprive other individuals of it

Issues with data

• Ownership
• Value
• Pricing

Do not make the confusion with the

tragedy of the commons

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 Variety & Complexity of data production process

Pre-exist before exchange Produced during exchange

Transactional Data
User Generated Identity data from the user
User Generated data

Industrial data (M2M)

Digital Interaction Navigation data
Contractual data
Generated Behavioral data
(by-product)

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 Raw data

• « Raw data is an oxymoron »

– Data are build and the fruit of an
intention
– They are designed for a purpose
– It is the result of a measuring device
that generates it
– It therefore depends on this
measuring device (sensor, recording,
survey, etc.)

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Data value comes from its circulation

DARK DATA

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 Data Evolution

Volume

Veracity Variety

Visibility Velocity

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 Big Data

• Data volume
– New IT challenges:
• OLTP Database not always effective
• Performance of processing
– Large catalog management with MongoDB
– New opportunities thanks to machine learning
• Recommendation algorithm
• Conception process (Content Square)
• Dynamic pricing (Boomerang commerce)
• Searchandizing & personalization (Sparkow, Antidot)
– New organization is required (ex: CMO/CIO)
– New skills needed (data scientists)

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Data architecture

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 D’où viennent les données?

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Organizing data

Structured data
Database

Denormalized
structured data
Datawarehouse

Datalake Non structured

data or semi
structured data

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Structured data: an example

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Meta-Data

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©
Typology of Metadata

• Descriptive metadata describes a resource for purposes such as

discovery and identification. It can include elements such as title,
abstract, author, and keywords.
• Structural metadata indicates how compound objects are put
together, for example, how pages are ordered to form chapters.
• Administrative metadata provides information to help manage a
resource, such as when and how it was created, file type and other
technical information, and who can access it.
• There are several subsets of administrative data; two that are
sometimes listed as separate metadata types are:
– Rights management metadata, which deals with intellectual property
rights,
– Preservation metadata, which contains information needed to archive
and preserve a resource.

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 Functions of Metadata

• Resource discovery
– Allowing resources to be found by relevant criteria;
– Identifying resources;
– Bringing similar resources together;
– Distinguishing dissimilar resources;
– Giving location information.
• Organizing e-resources
– Organizing links to resources based on audience or topic.
– Building these pages dynamically from metadata stored in
databases.

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Functions of Metadata

• Facilitating interoperability
– Using defined metadata schemes, shared transfer protocols, and crosswalks
between schemes, resources across the network can be searched more seamlessly.
• Cross-system search, e.g., using Z39.50 protocol;
• Metadata harvesting, e.g., OAI protocol.
• Digital identification
– Elements for standard numbers, e.g., ISBN
– The location of a digital object may also be given using:
• a file name
• a URL
• some persistent identifiers, e.g., PURL (Persistent URL); DOI (Digital Object
Identifier)
• Combined metadata to act as a set of identifying data, differentiating one object from
another for validation purposes.
• Archiving and preservation

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 Data value creation framework

Data-driven Business Model Ethical rules

Strategic Level

Organizational Data Governance Data Compliance Data skills

Data Quality
Level

Operational Data Ownership Data Collection & Consumption Data stewardship

Level

Technological Models Data Visualization Data Security

Data Meta-Data Algorithms
Level UX/UI

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 Where does value come from ?

Data Meta- Algorithm Visualization

Data

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 Data & value creation process

Personnal Data
Second Party Data

Shadow Data

ContextualData

Collaborative Data
Data Driven Value
Creation Process
Third Party Data Open Data

Autonomic Data
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 Typology of customer involvement in the value creation process

Passive Active

User driven Customization Co-Creation

Enterprise driven Personalization Community

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 Algorithms categories

Statistics
u ro g
e ti n
N pu
o m
C
Artifical Intelligence
Data
Mining
Machine
Learning
Deep
Databases Learning
Knowledge Data
Discovery
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 New class of algorithm

Machine learning Classical Statistics

Networks, graphs Model

weights Parameters

Learning Adjustement

Generalization PerformanceTest

Supervised learning Regression /Classification

Non Supervised learning Density Estimation /

Segmentation

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 INTRODUCTION

• a digital economy.
•what is a technology?
• what is an information system?
• what is management?

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 Information Value chain

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 IS

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 IT & strategy

4 5

1
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 The IT ecosystem

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 information system : definition

• Information System :
« set of physical, software, human, procedural, informational resources
enabling the acquisition, processing, storage, communication of
informations within organization. » (Reix 2000)

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 Different levels of IS

Executive
Information
System

Datawarehouse Decision
KM
Support
System
Office
Intranet Automation Groupware
System
Suppliers customers
Transactionnal
SCM ERP Processing CRM
System
E-commerce

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 Typology of IS

Organisationnal process
Level of use
Transactionnal Decision Communication

EIS, DSS, expert Word processor,

Individual Individual TPS
systems electronicagenda

Shared Agenda
Groups Workflow GDSS Visio-conferencing
E-mail

Collective decision
Organization ERP
systems
E-mail; Intranet

Inter-
EDI IOS of decision Extranet, Internet
organizations

Source: Reix (2000)

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 INTRODUCTION

• a digital economy.
•what is a technology?
• what is an information system?
• what is management?

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 Introduction

First vision of management

Management can be defined by 4 process:

1. Finalization process;
2. Organization process;
3. Animation process;
4. Controling process.

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 Finalization process

• Create a vision for the entire company

• Set strategic goals
• Take into account different demands (internal and external) i.e.
stakeholders approach
• Many aspects:
– Values of executives
– Define objectives
– Competitive intelligence
– Decision process
– Goals communication
– Resources Allocation

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 organization process

• Define company structures.

– Define the division of labor.
– Define the formal structure.
– Define differenciation degree.
– Define centralization degree.
– Set up coordination process
– Define control process.

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 animation process

• All means that enable to reach the goals beyond structure.

• Animation of people:
– Motivation, implication
– Human resources management
• Communication process

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 control process

• All mechanisms that enable the control :

• The reach of strategic goals
• The use of resources (efficiency).
• Three levels of control:
– Strategic Control strategic
– Tactic Control management
– Operational work control

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 Introduction

Second vision of management

In addition to the 4 process :

1. Client process
2. Supplier process
3. Partnership process

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 beyond traditional approaches of management

• The first vision limited to 4 process is limited because:

– It is based on a hierachical view of the company.
– Limited to its sole owned assests
– Companies rely more and more on external resources
– Competition forces companies to pay attention to the customer (one-
to-one marketing)
– uncertainty of the environment leads to flexibility and agility
(dynamic reconfiguration).
– Capturing the value of technical progress rely on partnerships.
• Networked company

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