This document discusses the challenges of developing global information systems. It outlines technological barriers like differences in infrastructure, languages, and standards. It also discusses regulatory barriers involving tariffs and import/export laws. Cultural and economic differences between countries are challenges, like payment mechanisms, intellectual property laws, privacy laws, and respecting local customs. Managing projects across different time zones and political environments introduces additional complexity for multinational corporations developing global information systems.

1. Lecture 7
Challenges of Global Information Systems

2. Multinational Organizations
• An increasing number of corporations are
becoming multinational
• Global information system: a system that
serves organizations in multiple countries
– Used by multinational corporations

3. The Web and International Commerce
• The Web has become an important vehicle for
B2B and B2C commerce
• The ratio of non-English speakers to English
speakers on the Web is growing
• Internet opens enormous global opportunities
• Chinese market is expected to be the largest
in the future
• The Web offers opportunities to increase
revenue and to save on costs

4. The Web and International Commerce
(continued)
• Online manuals with animation replace paper
documents
• Web sites and documentation are presented
in many languages
• Global businesses must be sensitive to local
audiences
• Globalization: designing global sites to cater
to local needs and preferences

6. Think Globally, Act Locally
• International companies must “think
globally, act locally”
• Acting locally means being sensitive to
regional customs and language nuances
• Control must be decentralized
• Strategic planning should be global, but can
be followed with a local flavor

7. Challenges of
Global Information Systems
• Global information systems face challenges such
as:
– Technological barriers
– Regulations and tariffs
– Electronic payment mechanisms
– Different languages and cultures
– Economic and political considerations
– Different measurement and notation standards
– Legal barriers
– Different time zones

8. Technological Challenges
• Not all countries have adequate information
technology infrastructure to allow companies
to build an international IS
• Broadband communication lines are needed
to support today’s graphics-rich Web pages
• Companies can offer two versions of their
Web sites to compensate for slower
bandwidth

9. Technological Challenges
(continued)
• Language is another technological challenge
– Eight-bit byte code is not sufficient for languages
with large character sets
– Unicode allows for 65,536 characters
– Must coordinate with databases and applications
• Telephone number and postal code formats
are different in different countries

10. Regulations and Tariffs
• Countries have different import regulations and tariffs
• Executives may be reluctant because of hassles of learning the laws,
taxes, tariffs, and regulations of other countries
• Companies must comply with the laws of destination countries
• NextLinx help importers and exporters for Web commerce by providing
tariffs, customs delay information, license requirements, etc.

11. Differences in Payment Mechanisms
• E-commerce allows easy payment for online
purchases
• Credit cards are the preferred payment
method in North America
• Not all countries have adopted this
preference
– High level of stolen credit cards in Eastern
Europe
– Europeans prefer debit cards
– Most Japanese reluctant to use credit cards

12. Language Differences
• International parties must agree on a common
language for communication
• Data might not be transmittable
internationally in real time because it must
first be translated
• English is considered the de facto
international language
• Large companies translate their Web sites into
local languages

13. Cultural Differences
• People from different countries vary in their:
– Tastes
– Gestures
– Preferred colors
– Treatment of people of certain gender or age
– Attitudes about work
– Opinions about ethical issues
• Conservative groups in other countries may dislike the
“Americanization” of their cultures
• Web designers must be sensitive to cultural differences

14. Conflicting Economic, Scientific,
and Security Interests
• Goal of corporate management is to seize a
large market share and maximize organization
profits
• Goal of a national government is to protect its
economic, scientific, and security interests
• Scientific information is an important national
resource as well as a great source of income
for foreign corporations

15. Conflicting Economic, Scientific,
and Security Interests (continued)
• Weapons manufacturers have technical
drawings that are valuable to both the
company and the security of country
• Countries treat trade secrets, patents, and
copyrights differently
• Intellectual property is tightly protected in the
U.S. and Western Europe, but less so in other
countries

16. Political Challenges
• Information is power
• Some countries oppose the policy of free
access to information as a threat to their
sovereignty
• Governments may require that only open
source software is used in government
operations
• Global corporations must ensure compatibility
with software adopted by local governments

17. Different Standards
• Differences in standards must be considered
when integrating ISs internationally
• Records may be incompatible
• United States uses the English system of
weights and measures; the rest of the world
uses the metric system
• NASA lost a $125 million Mars orbiter mission
due to an error in a data transfer, caused by a
mismatch between U.S. and metric
measurements

18. Different Standards (continued)
• Different standards also exist for:
– Dates
– Times
– Temperatures
– Addresses
• United States uses month/day/year format;
the rest of the world uses day/month/year

19. Legal Barriers
• Countries have different laws that affect global business in
general and e-commerce in particular
• Differing laws pose challenges to:
– International transfer of data
– Free speech
– Location of legal proceedings when disputes arise
• Privacy laws
– Respect for privacy in international business is an unresolved
challenge
– The majority of democratic nations try to protect individual
privacy
– Laws reflect a difference in approach to issue of privacy

20. Different Time Zones
• Different global regions require policies for
work and information systems
• Teleconferencing systems must be available
most of the day, sometimes 24 hours per day
– Allows employees from different time zones to
discuss problems that need immediate resolution
• Teams in support centers may work shifts to
accommodate clients worldwide

21. Different Time Zones (continued)
• Managers must be aware of incorrect time
stamping in different locales
• Systems at both locations can be designed to
record local times of both locations, or record
a single time (that of the company
headquarters)