The information in this chapter supports the notion that the efficient use of technology actually should be categorized as a control problem. Control is making things happen at Sperry Van Ness in the way they were planned to happen. Going one step further, the process of controlling is the action that management takes to control. Ideally, this process at Sperry Van Ness, as within any company, would include a determination of company plans, standards, and objectives so that steps can be taken to eliminate the company characteristics that cause deviation from these factors.

In theory, Sperry Van Ness management should view controlling activities within the company as a subsystem of the organization’s overall management system. For management to achieve organizational control, the controlling subsystem requires a portion of the people, money, and other resources available within the company.

The process portion of the controlling subsystem at Sperry Van Ness involves three steps:

1. Measuring the performance levels of various selling units

2. Comparing these performance levels to predetermined performance standards for these units

3. Taking any corrective action necessary to make sure that actual performance levels are consistent with planned performance levels

Based on information in the Challenge Case, one area in which management should emphasize standards is desired profitability. Management is initiating a new set of processes to ensure that Sperry Van Ness and its real estate advisors in the field are working with the same information.

As the company gathers more information and considers potential corrective actions, management must be certain that each action is aimed at organizational problems rather than at symptoms of problems. For Sperry Van Ness’s management to be successful in controlling, managers have to be aware not only of the intricacies of the control process itself but also of how to deal with people as they relate to the control process. With regard to people and control, managers must consider the amount of power they hold over organization members.

The total amount of power that Sperry Van Ness management possesses comes from the positions they hold and from their personal relationships with other organization members. For example, the top managers already have more position power than any other managers in the organization. Therefore, to increase their total power, the top managers would need to develop their personal power. Top management might attempt to expand their personal power by developing the following:

1. A sense of obligation in other organization members toward top managers

2. The belief in other organization members that top management has a significant level of task-related expertise

3. A sense of identification that other organization members have with top management

4. The perception in organization members that they are dependent on top management

Information at Sperry Van Ness can be defined as conclusions derived from the analysis of data relating to the way in which the company operates. The case implies that managers at Sperry Van Ness will be better able to make sound decisions, including better control decisions, because of the successful data handling achieved by its information system. One important factor in evaluating the overall worth of Sperry Van Ness’s information-handling system would be the overall impact that the system has on the value of the information that company managers receive. A manager such as Kevin Maggiacomo must see that investing in reasonably priced technology can enhance the value of the information he receives and improve the appropriateness of his decisions. That is, investments in improving information system components can enhance the appropriateness, quality, timeliness, and quantity of information that Maggiacomo can use to make decisions. Maggiacomo must also believe and act on the notion that making investments in technology will significantly improve his decisions.

For a company such as Sperry Van Ness to get maximum benefit from computer assistance, management must appropriately build each main ingredient of its IS. The IS is the organizational network established to provide managers with the information that helps them make job-related decisions. Such a system would normally necessitate the use of several IS personnel who would help determine information needs at the company, help determine and collect appropriate Sperry Van Ness data, summarize and analyze these data, transmit analyzed data to appropriate Sperry Van Ness managers, and generally help managers interpret received IS information.

To make sure managers receive appropriate information, Sperry Van Ness’s IS personnel must appreciate that different managers need different kinds of information. As an example, a top manager would normally need information that summarizes trends in consumer tastes, competitor moves, and productivity and costs related to various organizational units. Middle managers would need information that focuses more on specific operating units within the company, such as details regarding the performance of a specific office. Lower-level managers would normally need information about sales goals.

Assume that Maggiacomo has just decided to establish a new IS. Sperry Van Ness, like any other company, would probably gain significantly by carefully planning the way in which its IS should be established. For example, perhaps the answers to the following questions, which might arise during the planning stage of Sperry Van Ness’s IS, would be useful: Is an appropriate computer-based system being acquired and integrated? Does the company need new IS personnel, or will current personnel require further training to operate the new IS? Will managers need additional training to operate the new IS?

As far as the design and implementation stages of Sperry Van Ness’s new IS, Maggiacomo should seek answers to such questions as: How do we design the new IS based on managerial decision making? How can we ensure that the new IS, as designed and implemented, will actually exist and be functional?

Maggiacomo, as well as IS personnel, should continually try to improve the new IS. All users of the IS should be aware of the symptoms of an inadequate IS and should constantly attempt to pinpoint and eliminate corresponding weaknesses. Suggestions for improving the new IS could include: (1) building additional cooperation between IS managers, IS personnel, and line managers; (2) stressing that the purpose of the IS is to provide managers with decision-related information; (3) using cost–benefit analysis to evaluate IS activities; and (4) ensuring that the IS operates in a people-conscious manner.