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Inter Organizational Information Systems Information Technology Essay

Paper Type: Free Essay Subject: Information Technology
Wordcount: 5546 words Published: 1st Jan 2015

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In these decades, most of the businesses rely on Information systems in each & every aspect. As a result of globalization not only all the countries but also the companies in the world try to adjust with new technology as well as with the electronic systems such as information system. Nowadays businesses like to outsource their company activities rather than bind with same industries. But there is an out sourcing cost which has to be born when the tasks of the company are outsourced. There are so many advantages as well as so many disadvantages can be seen like secret information can be spread all over the industry by outsourcing of such systems such as salary systems, financial systems, HR systems, manufacturing systems in an organization.

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There are so many information systems are found in companies as payroll systems, accounting systems like AC pacc packages, Accounting spread sheets, Oracle, SAGE and so on. They are providing a value added advantage to the business by minimizing manual errors, frauds etc. But in outsourcing of manufacturing functions of an organization; core-competencies, improving in production as well as the quality must be considered before outsourcing.

Inter organizational information system is an important tool to carry-out organizational activities more than above mentioned information systems. These kinds of systems are supporting to enhance telecommunication technology among the business units. It is a good sign for future markets. The inter-organizational systems are also built as result of e-business as well as globalization.

Importance of the Study

This kinds of system are very important in so many hands like, can share information as well as decision from top to bottom by using information systems. With the help of such systems organizations can address each and every kind of people not only the managerial people but also in normal employees such as clerks, peons and so-on.

Information system actually plays a wide role in business world not only by providing information to the organization body but also by gathering facts, data, information from out -side which are useful to the company. Exchanging & sharing ideas among the business units is very helpful to survive in the business world, hence inter-organizational business acts major role to fulfill such circumstances.

As an example, if in such company divided in to business units as manufacturing unit, human resource unit, finance unit and so-on, this inter organizational information system is very much essential to make co-ordination among these units and achieve specific goals within a minimum time period. In present we can see so many accounting information packages as mentioned earlier to build inter-organization relationship between accounting divisions of same organization. Most recently, businesses like to out-source their functions with out-side companies who provide out-sourcing facilities; in such situations inter-organizational information system act as a connector of the main business as well as the out-sourcing units. This also can be used to get the competitive advantages by understanding the threats and opportunities.

Inter – organization information system is one of the system tools which helps to make efficient in business in modern world since most of the companies addicted to practice such systems more than earlier decades as a result of new technology.

IOS dependencies and its significance

Today’s world is well known for the technical computer oriented world. Renewed organizations totally depend on the E-business (Electronic Business). E-Business proves a very good source for the advertising of product. E-Business is very good example of inventions and innovations as well as improved skills of technology of a company. So there can be seen a strong relationship between IT and Inter-organization system. An industry has many branches like firms but each industry has its own IT (Information Technology). Each company has a desire to spread its business in worldwide area such as multinational company. So there can be seen a desire to make profit, attract consumers, offer facilities to its own clients. There is a trend of international trade as well as strong relationship between an industry and outside partners. When a company’s will is on global, then there will be major point of outsourcing. For the uprising of the industry and the whole firms of an industry tries to offer a high quality production to its customers, IT proves a major aspect for the advancement of the organization.

When a company make a product then it has to spend a large time to see gain profit, improve quality, consumers, competitors, price, substitutes, demand, supply chain, stock, as well as internal and external suppliers. For example when an organization produces a product the major points will be demand for the product, price of the product and status of competitors among the industry, when demand increases for a product then automatically output and input of the product increases according to supply and price. Substitutes are also involving for the production of the product. Demand is flexible, so production is also flexible. A product is always built to order (BTO). It requires order, demand, outsource, employed etc. There can be seen long term demand as well as short term demand such as the demand for warm clothes increases in winter not in summers but on the other hand patrol is all ways needed. When the price of the product will decrease then demand will be increased. The effective policies permitted by law prove beneficial for the further development of the organization. Each organization concentrates on social, economic condition as well as cultural, policies, suppliers and buyers teach it how to manage in society. Inter-organization system is related with suppliers and buyers performance.

Planning and decision making process is also related to supply chain management. Inter-organization is also related to market such as shareholders, stock, demand factor. To improve supply chain management there is a system of Quick Response System (QRS) in this way an organization can improve its relationship with suppliers/buyers and between two parties. Supply chain management can improves itself by offer a high quality of product as well as good quality of raw material. A high quality of the product will have ability to provide satisfaction of its customer. The three well known level of communication is micro, meso and macro. Micro related to individually, Meso related to group and Macro related to broader aspect communication. Senior management makes decisions for organization to make product, to gain profit as well as investment.


I have analyzed the higher level of external co-operation shared towards advancement process efficiency where inter – organizational systems allows firm to gain sourcing trust over their suppliers. Higher level of Information system may not be useful for gathering information from the market and compare with the different available options.

Information system also provides the facts that the firm produces standardized and good facing cut throat competitors by process efficiency by working enhancement higher level of corporation. IOS allows the organization to achieve all the aim target process oriented suppliers and buyers. Mangers should be very careful to check the processes which are fulfilled by the employees on the base of IOS.

It is controversial that using ISO and gives advantage for transactional needs. It can help organization in the use of electronic system to target market as well as valuable suppliers. Were as all the process can be achieved only when the electronic system is established through integrated system. Suggestions helps the managers to identify the different facts of inter organizational system and making a decision and implementation and the use of inter organizational systems in different sections, the findings done by various researchers in the field of knowing the impacts in relation to the adoption of the impact of Inter organizational system. When needed to widen and the classification related to IOS concepts. Which also helps to include much wider scope in the enhancement latest website based processing data system and suppliers in co-operation or interrelationship with the management system. This will advance and increase the analyzing the various processes and facts of ISO and it will also need to have more spectacular internal and external perspective implementation. For example by analyzing done by Hard and Saunders(1998) he found out that one process of EDI can determine or find out factors of different processes. Thus we can explore and determine the performance and functionality of impact on inter organizational system.

Theoretical processes and its functions


Direction of inter – organizational information systems in the role of system to human and system to system in the process of effective system function for the various process carried on by the instructions from the computer to computer and then to the process of the human understanding interface. This can be understood by the following –

Mainly there are 2 most important parts in an inter – organizational information systems that determines the correct and effective functioning of the programmed automated information dispensation in field of system integrations are broadly classified into 2 parts they are system to system and system to human incorporation.

The system to system incorporation mainly causes the transformation of data between the inside of the information systems of the executing data for an organization is fully automatically done, there is no need for the human mind to be applied or not needed to input computerized functions to processes the information systems. It is designed to make the process outcome automatically with accurate results with – in a less period of time. For example as the electronic data interchange carries out the main classical automated data to compile and execute the data for the user for the directed desired outcome of result by the various amounts of transactions done and carried out by the implementation of EDI. (“Matthew K. McGowan, 1996”)

Now let’s pass on to system to human incorporation. Under this the data which is been transacted is semiautomatic by this term we come to know that the human intervention is included as well as the system process the data from one person through the inner information systems to and is send in a form of electronic system design layout to another person and then the receiving person collects the data and then processes it physically or by hand. Mainly this type of method is done in supply chain electronic incorporation where the internet based technologies have provided this in order to avoid very expensive system to system functioning costs this is done by even providing web gateway most commonly known as web portal. In order to gain fast functions to be carried on and less errors to be caused and more of accuracy in short period of time that would cause in best time management in information systems then the implementation of inter – organizational information systems should be done. “Jouni Kauremaa”, “mikko karkkainen”, ” Timo Ala Risku” , “Helsinki University of technology, Finland”


Under this a broadly classified impacts were studied and various researches were conducted on the influence and impacts of inter-organizational information systems for miniature company suppliers. At the first earlier analyzing were only done in an organization or company depending on the observation of the company executives and mainly the data that was in process in operational stability and measurable performance data was not taken into consideration and was not composed in order to know the impacts of inter – organizational information systems. And at the second the studies on internet based electronic data interchange was concentrated in order to carry out purchases and also processes like one technology and one function was applied and later on other internet technology like e mail and various websites caused a presence. What I feel is that the clear comparisons on the intensity of inter organizational information systems and the impact on SME’s is not there in various articles.

Research planning and its appropriateness

Inter Organizational Information System contribute a lot towards their businesses and other organizations. Information used in organizations is for various functions like planning, controlling decision- making and organizing. The planning of information systems is done to support the activities of organizations information needs by recognizing the apt portfolio of applications that are computer based. Due to recent changes in the external business environment, Inter-organizations relationships have become an important part, which makes a need for organizations to interact, share information and technology, and even cooperate in a healthier way with each other. If there’s a balanced approach between Business and IT, it is expected that business opportunities and advanced IT technologies are able to innovative essential plans. It can help the organizations to achieve their business goals.

An organization needs to select a planning approach based on the management culture and business environment of the other organization. It’s not an easy task to plan this system because of the stakeholders’ involvement, which means that organizations should be very careful in planning. There is also a possibility of using other organizations strategy, which is a negative impact. Success in the planning of Inter Organizations Information System has become difficult and a bit critical. It is been studied that a planning based on evolution and learning is more relevant and successful, builds a level of being adaptive and flexible in the process of coordinating and control activities. People in organization may differ in levels of IT skills and knowledge, it helps them to learn to understand and implement the challenges and benefits of the cooperating through an Information System. It is much difficult for an organization to cooperate in Inter-Organizational Information System if the Intra-Organizational infrastructure is still not maintained. The knowledge gained through this relates to building of Inter-organizational information system and issues like effects in the technologies.

The plan of using IOIS has increased as there’s a modification in the process of business, so that the organizations can respond well towards their opportunities, trading partners and even the needs of the customers. Thus, by planning IT system has enabled an organization to bring changes in its activities. The system helps in creating competitive advantage and also improves the economic performance of each organization. It helps in managing better relations with buyer-suppliers. By the process of planning to use the information system, organizations become dependent on each other and a mind-set of trust is increased among partners. For the development of cooperation between organizations, they need to assure that there is continuous flow of information between the cooperating partners.

The main purpose of this system is to share data, information, business applications to make available the electronic transactions about buying and selling of goods and services for the business partners. It has also been recognized as a key or major factor for the growth in their business. So, there should be proper planning before implementing it, the organizations needs to be very careful, as its useful and at times a harmful for the organization.

Key findings and limitations


In this context we will a have wider look on the merits and demerits of internet based internal and inter-organizational Information system for an Organization:

As in this cut-throat competitive world of business, organizations have set up internal and inter organizational information system to run their business in a more efficient way.To begin with, first of all, we will discuss the merits of IOIS. Firstly Internal IT gives a wonderful chance to employees to understand the business strategies in a broader way. IOIS is also familiar for its business name Electronic Data Interchange (EDI), as it is an easier and comfortable way of interchanging data for organizations. Moreover Internal Information system helps employees up to a great extent to save their precious time, as they can collect data for their work sitting at one place only and it can be very helpful for organization in terms of gaining more profit.

Furthermore, Inter-organizational information system is a boon in field of business for all organizations, as it gives comfort to them to collect and interchange their data while communicating via internet only, by using this indispensable tool of IT, it gives golden opportunity to organizations to place electronic order for goods, confirming their collection time and share number of other documents instantly with their business partners world wid. In addition, reduction in cost of communication, labor and paper work are other inevitable benefits are given by IOIS.IOIS gives chance to firms to improve their relations with their business partners and supply chain as well, as lots of problems and conflicts can be sorted out with far-away places trading partners with the introduction of this system and which gives a mutual benefit in business.

In contrast, as each prospect involves pros and cons. So IOIS has few negative features as well. First grey area of IOIS is its additional expenditure to Value Added Network (VAN) reaches up to $5000-$7000 per month (Bartholomew 1997). Consequently, adoption of this system is not that much easy specially for small companies because of its expenditure, so it can be unaffordable to bear its cost for small scale organizations. As well as, for a successful Implementation of IOIS, a compatible hardware is must at both the ends, for instance, on one hand, one company is having a compatible set up for IOIS, however it is not the same with its trading partner on the other side, so it is obvious to arise difficulties while communicating and data interchange, so undoubtedly these hurdles due to poor hardware will affect the business financially as well as the relations personally in future.

Moreover, one major drawback of this system is, as it is an internet designed system. So business strategies and policies, scheduling goods of various firms are available online such as financial reports and so on, So gathering and misusing data that is just child’s play for a person who has full command on computer operations and that thing can be damaging for companies, as their secrecy can be leaked and misused by any other organization for their own benefits. Not surprisingly, IOIS is not reliable enough in terms of Security, as authentic information’s and company’s unwanted plans can be revealed and altered or adopted easily by any other company, which can harm the company in a harsh way.


“Robert B Johnston, Kai Reimers, Stefan Klein”, “bled Slovenia june 21 – 23,2004” “The Shaping Of Inter-Organisational Information Systems: Main Design Considerations Of An International Comparative Research Project” “http://www.wi.uni-muenster.de/wi/forschen/veroeff/Shaping_of_IOIS.pdf”

“Jouni Kauremaa, Mikko Karkkainen, Timo Ala Risku”, “Helsinki university of technology” , “http://legacy-tuta.hut.fi/logistics/publications/IOIS_SME.pdf”

“Stefan Klein, Stefan schellhammer, Kai reimers, Kai remer” “University of Munster”, “http://www.kai-reimers.net/Evolutionary%20Paths%20of%20Inter-organizational%20Information%20Systems.pdf”

“Donatella Sciuto, bled Slovenia, June 6.8.2005” “exploring the role of inter organizational information systems within SME’s aggregations”, “http://www.bledconference.org/proceedings.nsf/0/02d5f171ae4576e8c1257014004a2af8/$FILE/29Ravarini.pdf”

“Nicholas Berente, Ryan Baxter”, “Case Western Reserve University, USA”, “supporting knowledge creating through inter-organizational information systems; pragmatic collaboration between object worlds”, “http://www.bledconference.org/proceedings.nsf/0/02d5f171ae4576e8c1257014004a2af8/$FILE/29Ravarini.pdf”

 “Aurelio Ravarini, Federico Pigni, Giacomo Buonanno,1Università Carlo Cattaneo”, “Italy 2005”, “Exploring the Role of Inter-Organizational,Information Systems within SMEs Aggregations”

London School of Economics and Political Science” “Stakeholder identification in inter-organizational systems”: “gaining insights for drug use management systems Information Systems Department,”

“Kenneth C.Laudon, Jane P.Laudon, Hardcover Edition, 2003. Management Information Systems”,

“Deanna J. Richards, Braden R. Allenby and W. Dale Compton”, “National Academy of Engineering” ,2001″, “Information systems & the Environment”

Source:”www.ebrc.com”Available “http://www.ebrc.fi/kuvat/Makipaa_paper.pdf”

Source: “www.bledconference.org”



.”khalid S.Soliman” Hosfstra University (2000),”http://www.wi.uni-muenster.de/wi/forschen/veroeff/Shaping_of_IOIS.pdf”

“Brian D. Janz The University of Memphis (2000).”

“Scala,S.and McGrath,R”.,”Advantages and disadvantages of Electronic data interchange”, Information & Management,Vol.25,no.2 August 1995,PP.85-91.

“Lacovou,C.L;Benbasat,I.;and Dexter,A.S”. quarterly,”Vol.19.No.4,December 1995,PP.465-485″ ,”Electronic data Interchange and small organizations : adoption and impact of technology” ,MIS

“Khawaja A. Saeed1,*, Manoj K. Malhotra,Varun Grover” “Article first published online: 2 AUG 2005 DOI: 10.1111/j.1540-5414.2005.00077.x”, “Examining the Impact of Interorganizational Systems on Process Efficiency and Sourcing Leverage in Buyer-Supplier Dyads”

“Donald r greer, Laura, Richard j. Adams” “leadership and the dynamic of inter-organizational communication and development” “www.greerblackcompany.com/la1_2006_abstract.pdf”

“Auther, chen, injazz, paulraj, antonym, lado Augustine, 2008, 2004” “competency-antecedents-and-performance-outcomes-i-html”,”www.faqs.org/abstracts/…/inter-organizational-communication-as-a-relational”

“Stanley e. Fawcett, Gregory magnan, Sergio g. lazzarini, Fabio r. chaddad , michall cook” (2002) “the rehetoric and reality of supply chain integration integrating supply chain and networking analysis: the study of net chains” “www.ssrn.com”

“zu zhi xing wei xue- john r schermerhorn 2004” perspectives on organizational communication –

“terrence l garinlo, ebrary, inc-2005”, “the strategic use of stories in organizational – Organizational behavior”


By this study we can examine to know that inter – organizational information systems is the main factor for the connection of buyers and suppliers, to be in connectivity so that they can carry out all the transactions between them smoothly. We come to understand the concept and depth of inter organizational information systems in the merit to large and small enterprises, that information systems plays a main role in an organization for various processes and functions such as accounting, data transfer, emailing, recording data, secured transaction data and semi manual organized data. This type of functioning helps the organization to do its work and transacting of details to the computer and to the party with in a small period of time which makes the work of an organization even faster. Thus this even helps in building good relationship with buyers and sellers. This type of software is expensive most commonly termed as system to system. But various small companies or outlets need information systems so semi automatic, system to human interface is provided thus this software is not expensive also and is effective for such data transfer. The term information system means handling or providing information about a particular subject from one party to another party in the mutual understanding between them. System to system and system to human integration has helped the buyers and sellers to resolve the problem of leaving back the barriers of electronic business but it is only partly resolution only if total efficient benefits are the aim.


1. Research limitations on organizations whose business processes carried on by inter organizational information system tasks are mainly outsourced.

2. When needed the concepts relating to practical narrow area can be applied.

3. The reliability and sustainability in IOIS is a bitter experience for various organizations due to its inflexible electronic intend.

4.For doing various research on organizations researchers are not free to get important documents from the firms due to its secrecy, this documents could help researchers to find out a way around to provide solutions for various problems relating to IOIS impacts on SME’s.


In today’s world of computer oriented functioning it is possible for information systems to get hacked by various hackers who do this to destroy ones organization and to steal money. I recommend that security measures should be taken by providing such strong software that can avoid unauthorized entry in the information systems of an organization.

Inter organizational information system’s effective functions depends on the management of the organization to implement effective procedures to resolve the errors caused in the information system and to keep an eye on the employee of the information technology department for their delay or miss input of data for transactions from system to system, that would cause in heavy loss to the organization.

The study on comparisons between the intensity of inters organizational information systems and the brunt on small medium enterprises is not done or found in various books and articles. To determine the study on brunt on small medium enterprises should be taken into consideration.

I recommend that small and medium sized enterprises should be taken into consideration because they have been departed from the co – operated networks provided by inter organizational information systems.

System to system integration is very expensive in comparison to system to human. In order to make all small, medium and large organizations to use this facility of software they should price the software in fluctuation comparison between both the data processing systems, depending to their customer needs and motives.


”University of Bedfordshire handbook”, 2010-2011

”Group report-6”, ”12.12.2010” ”inter organizational information systems”

3. ”University of Bedfordshire BREO”


Each & every aspect Inter-organizational information system is an essential system to any kind of organization since it has been providing facility to run the organization in a smooth manner. Not only technological industries but also manufacturing, production kind of businesses need information systems to faster their functions within the organization. Not like earlier decades, now all organizations carry their activities based on e-business, computerized systems & informational systems as a result of globalization. In our selected study it explains about how the inter-organizational information system acts in such a business which out-sources their activities. In here it shows the connectivity with out-sourcing divisions using information systems.

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If information systems is used by any kind of company, Organizational activities, business functions, customer relationships, industrial relationships can be maximized. It provides information which is relevant to decision making, build -up relationships among the organizational divisions within short time period; since Electronic systems are faster than the manual systems. Last not least we can say Information systems plays a wide role within the inter organizations by providing relevant details within a short time period by minimizing manual and technical errors. So every organization must incline to practise such systems for development of their business tasks in a proper manner.

Research Limitations

Mainly focuses on the business whose tasks are out-sourced.

Concepts applied to narrow area when concerned

It is not good for small scale companies

Data relevant to decision making and other activities can be spread all over the sectors as well. It is a disadvantage to the organization. This mainly happens due to the company out sources their activities with external parties


Before practising of Information systems; company should aware of the system and must know about the information which are generated from the system which is being used to decision making within the industry.

Cost to benefit analysis must be needed when company hopes to rely on such electronic system

This system should be in a method of exchanging information in divisional levels and industry level in a trust worthy manner.

Also this kind of information systems should be updated according to time to time; otherwise facts generation of such systems may be out-dated when taking decisions. Also decision taking based on out-dated information may leads to wrong picture about the organization in the industry.

Inter-organizational information system is an important element to carry-out organization activities in business world since all the activities based on electronic systems such as internet business and so on.

All the employees in the industry should be given a proper training in how to use such electronic & internet based system in a proper manner.

These kinds of systems should have some features like time saving, faster, proving proper facts related to activities, etc.

All the systems which are based on internet systems to be in user friendly, otherwise it will be a difficult task to feeding and gaining of information by the users.


Kenneth C.Laudon, Jane P.Laudon, Hardcover Edition- 2003, Management Information Systems

Deanna J. Richards, Braden R. Allenby and W. Dale Compton, National Academy of Engineering -2001, Information systems & the Environment


In my opinion, IT (Information Technology) refers to E-Business (Electronic Business) as well as EDI (Electronic Data Interchange). But all these aspects are very good source to spread business in the world wide area as well as to achieve smart goals for business. The new technology is well known the excellent result of inventions and innovations. Strong relationship between IT and IOS related to internal and external suppliers but it also depends on suppliers and buyers behavior. A high ability of management system of an organization spread it as a multinational company in the worldwide environment. But there can be seen two major aspect S2S (system to system) and S2H (system to human). S2S is an automatically (electronic) process and there is no need for the human mind. On the other hand, S2H is linked to internet as well as web portal because by the way of internet, data goes one person to another person. It is related to internet technology, e mails, and web-sites. The processes of business are based on IT and IOIS of the organization. Communication is also become a major aspect of busines


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