formal message that might be an answer to a previously asked question. It is useful
to distinguish among three types of business information: transactions, reports, and
messages. Transactions are structured business communications that describe basic
business activity, such as the transferring of funds among accounts or the payment of
an outstanding invoice. These are generated where the business activity, that is, sale,
takes place (often at the subsidiary) and transmitted to where the information is
processed (possibly the subsidiary, more often headquarters or a regional processing
center). Great care must be taken to ensure that all transactions can be accounted for
and that no unauthorized transactions are entered into the system. Thus, these sys-
tems require extensive controls. Manufacturing firms tend to produce more struc-
tured business transactions than do service firms. Reports are predetermined infor-
mation groupings, such as a monthly accounting statement, that are provided in
response to a request. Reports may be either periodicin that they are produced at set
intervals, or ad hocwhere they are provided when needed. They are produced by run-
ning an application program to extract information from a database. Messages are
point-to-point information transmissions consisting of text, graphics, or video media,
sent over the firm’s technology infrastructure (i.e., a network). Messages require that
the sender know or be able to obtain the network address of the recipient.
Not all information is of the same classand the classes are often treated differ-
ently. Three useful classes are corporate, local, and personal. Corporate data is offi-
cial shared data that describes important corporate activity. Corporate data often
comes from a corporate application and database, such as General Ledger, or the
Human Resources system and implies that agreement has been reached across the
corporation as to the exact meaning of the data contained in the system. Data of this
class is formally defined, and it can only be created and changed by authorized per-
sonnel, for example, by a payroll clerk in the human resources department changing
an employee’s monthly pay rate. Some corporate data may be confidential, such as
salaries, product sales figures, and customer lists, while others may be available gen-
erally within the firm. In contrast to corporate data, local data concerns only the or-
ganizational unit that generates it, for example, a report of the inventory level for an
item in a subsidiary’s warehouse. Local data, because of differences in meaning, cre-
ate difficulties in aggregation and reporting to headquarters and in exchange with
other subsidiaries (in inventorymay not mean the same thing among subsidiaries).
Personal data refers to data generated by an individual for his or her own use, such
as a client report or spread sheet analysis. As a general rule, the report or message
should indicate the class of information upon which it is based and even the specific
data source.
Regarding the importance of an international firm’s technology infrastructure,
Bartlett and Goshal^2 observe that companies operating globally will be at a serious
disadvantage if they are unable to firmly control their worldwide operations and man-
age them in a globally coordinated manner. A firm’s technology infrastructure is the
vehicle for accomplishing this global control and management.
(c) Differences between Domestic and International Firms. The differences between
domestic and international firms place significant demands on their information sys-
28.1 INTRODUCTION 28 • 3(^2) Bartlett and Goshal, 1987.