Foundations of Economic Analysis

With Ansoff's article about weak signals as a flagship example, a substantial body of knowledge about environmental scanning systems exists. However, these concepts often go unused in practice. The 2008/2009 economic crisis provided a strong, ongoing impulse for redesigning such information systems (IS). This article develops six guidelines for the conceptual design of environmental scanning systems that are more applicable than those specified by previous research. We start with literature research, which reveals three gaps in existing approaches. Then we develop design guidelines to fill these gaps with the help of "modern" IS. To address the lack of sound requirements analysis, our first design principle proposes 360-degree environmental scanning systems for executives and suggests how to select the most important scanning areas. Three further findings cover weaknesses in the IS model perspective, focusing on more effective implications of weak signals. In terms of method, we propose incorporating scanning results more closely into executives' decision-making processes. Applying the design guidelines at a raw materials and engineering company, we arrive at a prototype we call the "corporate radar." It includes an IS-based tree with economic value added at risk on top. The resulting lessons learned help to evaluate our findings and the research method presented here, as well provide concrete starting points for future research.

More applicable environmental scanning systems leveraging modern information systems

We provide descriptive and predictive evidence on the time-series properties and predictive ability of quarterly cash flows from operations (CFO) reported in accordance with Statement of Financial Accounting Standards (SFAS) No. 95. Previous work such as Hopwood and McKeown (1992) and Lorek, Schaefer and Willinger (1993), among others, has analyzed a proxy series (PCFO) for quarterly cash flows constructed via a relatively simplistic algorithm. We provide new evidence documenting that: (1) the time-series properties of quarterly CFO are at variance with the exclusively seasonal characterization of quarterly PCFO exhibiting both adjacent (quarter-to-quarter) and seasonal (quarter-by-quarter) relationships, (2) the Brown-Rozeff ARIMA model significantly outpredicts the random walk with drift model, seasonal random walk with drift model, and the multivariate time-series regression model (MULT) originally popularized by Lorek and Willinger (1996), (3) the forecast errors of larger firms are significantly smaller than the forecast errors of smaller firms, and (4) the predictive ability of the Brown-Rozeff model is robust. Specifically, we tested it upon an expanded sample of firms (n=745) obtained by eliminating the considerable data requirements of MULT and it exhibited superior predictive power.

Time-Series Properties and Predictive Ability of Quarterly Cash Flows: Working Paper Series--06-10

In addition to using executive information systems (EIS) in a fixed location, executives increasingly want mobile access, even when they are offline. Based on a framework for EIS use situations and on findings from an expert focus group with participants from multiple industries, we have identified the most important EIS use situations for executives. We classify executives as either Consumer (those who primarily consume EIS information) or Analyst (those who primarily work more interactively with EIS information). To evaluate the relevance of our findings, we participated in a project at Continental AG, a large European automotive supplier. We worked with Continental as it rose to the challenge of selecting the right mobile devices and appropriate software components for its executives' online and offline mobile EIS use preferences. Based on our research, we provide five recommendations for EIS design that will help CIOs in other companies to embrace their executives' growing need to access EIS from mobile devices. Some of these recommendations are generally applicable and will ensure executive buy-in. For Consumer executive use, we recommend first focusing on reducing reliance on paper-based reports, and for Analyst executive use, we recommend first focusing on increasing mobile EIS navigation functionality.

Extending Traditional EIS Use to Support Mobile Executives Online and Offline

Managerial decision-making has always involved the use of numerous distinct information resources. Modern managerial decision-making processes require a wealth of information that is enhanced and transformed into knowledge in order to take effective action. Mobility in business is increasingly exercising influence on core business processes of organisations. Recent advances in wireless technologies coupled with the rapid growth of mobile devices in business have led to a new era in business computing. Mobile Business Intelligence (Mobile BI) is a system that has been conceived to assist, accelerate and to enhance the managerial decision-making processes. Drawing from an array of previous studies that attempted to measure the value of Business Intelligence (BI) and other IT systems in organisations, this study develops a new kind of measure which is based on an understanding of the distinct properties of Mobile BI systems in an organisational-oriented context.

The Effect Of Mobile BI On Organisational Managerial Decision-Making

The increasing volatility of their companies' environment is a growing concern for executives. ISbased environmental scanning that complements the accounting information system domain can help to manage this challenge. A substantial body of knowledge on such information systems exists, but these concepts often go unused in practice. This article develops five design guidelines for environmental scanning systems that are more applicable than those outlined in previous research. In doing so, we first compile a set of requirements based on the principle of economic efficiency, and then use findings from the absorptive capacity theory to specify them. Challenging several implementations against these requirements in a multicase study generates findings that we synthesize into design guidelines. They address diverse areas: designing a more comprehensive model for information gathering, setting up a collective learning process for interpreting information, using IS to enable management techniques familiar to executives, designing processes for more interorganizational integration of environmental scanning systems, and accelerating prototyping.

https://aisel.aisnet.org/cgi/viewcontent.cgi?article=1096&context=ecis2012

Powering up companies' crystal balls: analysis of a multi-case study towards more applicable environmental scanning systems

This article proposes a configuration model for tailoring management support systems (MSS) to mana­gers' day-to-day interactions with IS when they are mobile and their perceived usefulness in doing so. Clustering possible characteristics yields different use situations. Configuring MSS to these use situa­tions, we apply the selection of smart devices and associated information media covering PDF reports extracted from the MSS, access to MSS via web browsers, and apps. Our research model is based on findings from a literature review. Using results from an expert focus group, enhanced with experience from practice we gathered in one-on-one manager interviews, we do not only generate situated variants for managers' mobile IS use, but also evaluate our plea for a situated IS design with the four findings. The handier devices are, the more they are used for frequent, but short interactions; semi-business apps make MSS smarter; apps can handle managers' mobile offline challenge; tablets have created their own use case for business in three ways as an advanced PDF reader, an electronic typewriter for more complex emailing especially with attached office documents, and for simple ad-hoc analysis on the fly.

Improving Mobile Is Acceptance: A Business Perspective

Companies use forecasts to predict deviations from their plans. Most of the forecasting processes rely on experience-based human judgement. Thus, they neglect predictive analytics which aims to be a "modern crystal ball." We take a utility company and its cash flow planning process as our reference. Combining the best of both worlds, experience-based human judgement and predictive analytics, we lay out three imperatives for a more accurate and efficient cash flow prediction model as follows: (1) The art of modelling is about the right input factors and their meaningful combination. A deep business understanding and insights from a correlation matrix will help. (2) The business department should set a clear target for the model in advance. Transparency of the algorithms and delivering tangible results are more important than the last inch of accuracy. (3) Leveraging data decomposition and a meaningful method mix, a clean-sheet approach often takes less time and people than existing approaches.

Predictive analytics – a modern crystal ball? answers from a cash flow case study

Die Buchhaltung macht der Roboter

Towards a More Situated Information Systems Design by Prioritizing Use Situations, in: Bednar, P., Frank, U., and Kautz, K. (Eds)Portsmouth, UK (Beyond Digitization – Facets of Socio-Technical Change)

J. H. Mayer

Papers

Powering up companies' crystal balls: analysis of a multi-case study towards more applicable environmental scanning systems

Improving Mobile Is Acceptance: A Business Perspective

Predictive analytics – a modern crystal ball? answers from a cash flow case study

Die Buchhaltung macht der Roboter

Towards a More Situated Information Systems Design by Prioritizing Use Situations, in: Bednar, P., Frank, U., and Kautz, K. (Eds)Portsmouth, UK (Beyond Digitization – Facets of Socio-Technical Change)