The Opportunities and Challenges of Implementing E-Procurement

AUTHOR

Noor Raihan Ab Hamid and Zaifuddin Majid (Malaysia)

ABSTRACT

The advent of Internet technology has spurred various innovative applications that business organizations could take advantage of. Among the crucial business application using the Internet technology is Electronic Procurement (E-Procurement), which is a method of procurement using the electronic catalog and automated workflow processes. The processes involved are Product Requisition, Selection Of Order, Issuance Of RFQ, Purchase Order Acknowledgement, Evaluation Of Proposal, Negotiation /Award Of Contract, Issuance Of Purchase Order, Fulfillment of Orders and Payment Of Order, all of which are conducted electronically via a low cost technology, the Internet. Although E-Procurement is still at its infancy stage in Malaysia, projection has indicated that sales of products and services via the Internet in Malaysia have the potential to grow from RM 46 Million to RM 1 Billion by 2003.

Motivated by low investment in the enabling technology and potential annual savings, companies are moved to explore the promises that this new application has to offer. The participating companies in E-Procurement would be that of buy-side and sell-side in a trading community. The sellers and buyers communities need a computer, modem and online Internet services. A service provider connects the communities’ via a web technology. Therefore transactions done using a standard format file are transmitted electronically to the sellers simply via the services provider’s web portal. The seller using a web browser can later access the file to then respond on line or change the requirement in accordance to the standard of procurement procedure. The service provider will send the purchase order for evaluation and publish the award of contract using a web browser, in which at a later time, a seller can check for the payment status. All of these electronic processes enable buyers and sellers to access accurate information instantaneously, eliminating the delays to wait for faxes and multiple telephone calls during price negotiations. These makes E- Procurement a cost effective solution to businesses.

This research aims to study the impact of E-Procurement adoption on Malaysia industries. This paper presents empirical data on how companies are reaping substantial benefits from E-Procurement. Various organizational objectives of implementing E-Procurement are also highlighted. In addition, this study discusses the opportunities and challenges of introducing new technology into an organization where researchers cited experiences and lessons to be learnt from a few local business cases. In collecting the data, face-to-face opinion survey with 32 respondents each representing a company was conducted. Industries selected ranges from industrial to services sector. In analyzing the data, descriptive analysis using mean and frequency were applied.

The results indicated that firms realized significant cost savings where in general a company is able to have at average of 10% reduction on the current material and services cost. However there is a slight difference on cost reduction in the manufacturing sector. This may be due to the implementation lag as manufacturers are still using the old method in some of the procurement processes. It is also found that buyers are able to speed up the Purchase Order process to 2 days, compared to the traditional process where the cycle time needed was 6 to 10 working days. Thus enabling them to increase the frequency of orders at a given time. In addition, reduction in processing time allows buyers spend more time on added value activities such as analyzing the inventory movement or supplier relationship management. The analysis indicated that telecommunication and manufacturing sectors marked the highest mean (4.43) in reducing purchase order cycle time.

Besides that, respondents index score indicates that the average cost for a traditional procurement is RM380 to RM400. On the other hand, 68% of the respondents agreed that E-procurement helps reduce administration cost around RM80 per purchase transaction. Furthermore, from the survey response E-Procurement also facilitates in reducing the inventory cost on the average of 25%. Results showed that trading and services industry score the highest mean (4.30) while manufacturing sector scored the lowest. Respondents suggested that E-Procurement helps to reduce the cost by lowering the manpower cost, storage system cost, and shipping arrangement cost. They also agree that as a result of adopting E-Procurement, they can better manage their supply chain activities.

In spite of all the benefits that E-Procurement produces, the challenges of implementing this application do exist. Lessons learnt from a few local service provider companies that have embarked on the E-Procurement endeavor indicated that factors such as incompetent infrastructure, global competition, human resistance to change and conflicting policies and standards pose immense pressure for the companies to move forward. According to an E-Procurement service provider, Malaysians are not ready for the Multimedia Super Corridor (an advanced local cyberspace project), because of the lack of technical expert competency, especially in highly technical skills in the area of Computer Networking System and ATM technology. Thus when dealing with technical issues in the discussion with International vendors, the local engineers may be lacking in support of arguments, losing control in the implementation and contributing less to solve the problem. Lastly, the vendors may bring more external expert to support them and as a result there will be an increase in cost.

Besides that, the biggest challenge among other challenges facing the buy-side community is when suppliers are not willing to share the information openly with all the members of the supply chain by providing all information into the E-Catalog. A buyer may be trapped in a situation when he compares the products costs without knowing the details in the quality specification as well as a good delivery time option.

In conclusion, while the effort still remains costly to some, businesses try to improve their E-Procurement processes. They adopted a long-term plan, as they believe that E-Procurement will appear to be a strategic approach of purchasing activity, particularly in the reducing transactional costs and pricing for their products. This research concluded that E-Procurement allows firms to expedite the purchasing process, and thus resulted in a more efficient supply chain management.

Representations as factor of organisational change

AUTHOR

Frédéric Ischy and Olivier Simioni (Switzerland)

ABSTRACT

Many current reflexions focus on the question of impact of information and communication technologies on our lives, and, in particular, on organisations. This starting point is interesting but it presents some problems to sociological analysis. Indeed, recent works in the field of the sociology of sciences and technology show total imbrication between human action and objects, artifacts, techniques which are integral parts of social structure (cf Bruno Latour). There are not technologies on one side and social agents ont the other side, the first determining the actions of the seconds. In fact, there is a complex, permanent interaction between both technology and social agents. In consequence, it’s necessary to take account of what one can call the representations, imaginary, utopias or ideologies as well as discourses linked to technological development to understand what technologies will do to us.

In this perspective, it is striking that the discourses accompanying the development of information and communication technologies – discourses telling us that we enter in an information society or information age – carry a vision of the society and individuals that joins the contemporary theories of management. Researches by Luc Boltanski and Eve Chiappello (cf Le nouvel esprit du capitalisme) show that a new ” spirit of capitalism ” has been emerging for about thirty years. This new ” spirit ” contains ideas of network, decentralization, demassification, permanent change even if, in the model of the two authors, the development of technologies is not fully mentioned. One can thus build an ” idéal-typique ” (cf Max Weber) model which helps us to understand the shaping of organisations not only from a technical viewpoint but also with considerations regarding the history of ideas. The management topics (flexibility, permanent change, …) mentioned above are in fact the same as in information society discourses in which the presence of technologies is central.

One thus sees that two starting points are possible. One is centered on technologies, and the other on ideas, which draws us back to a caricatural opposition in the social sciences between materialism and culturalism. We don’t want to choose between the two, but we want to show the interest of examining the world of ideas and discourses : studying closely the real impact of technologies needs taking account of representations because it is certain that this impact is ambivalent and depends strongly on the application context.

As a result of an empirical research taking account of discussions with more than 60 Swiss scientists, managers or politicians as well as international official reports from organisations or governments, literature that one can qualify the ” erudite one “, and fictions, we notice a recurring model in the discourses which defend the idea of information society emergence. Admittedly, the speeches base is elementary and indicates that it exists a convergence between telecommunications and computers and that we live a time of very significant changes. However, beyond this simple basic report, one can locate a recurring model of social or business organisation which is based on the need of total mobility, flexibility and of decentralization made necessary by a process of permanent change. This model do not entirely join a market or an industrial logic but subtly combines them to give birth to a new ideological configuration making it possible to motivate the actors, to reassure them and justify the changes.

While speeches defending the idea that the information society will be beneficial for all are extremely numerous, it’s important to say that a certain number of discourses have a critical vision. This vision does not only concentrate, as one could believe it, on the question of inequalities or of control but also on a problem that seems significant to us, that of incertitude or instability.

Indeed, in a world in constant change, which requires a continual adaptation and a total flexibility, individuals can be confronted not only with economic resources problems but also with identitary and psychological problems. A whole branch of science fiction literature (the Cyberpunk trend ; cf William Gibson’s Neuromancer) is confronted with this problem. This is not a negligible element because one can think that the science fiction literature partly reveals the present fears and can thus reveal the type of resistances, legitimate or not, that can fight against changes. However, what is often shown is precisely a world in which individuals are malleable, their bodies being transformed as far to disappear in cyberspace.

Anthropology and philosophy has indeed showed how much the body is the support of identity. It is the body that put individuals in a territory, a history and in social relations. The disappearance of the body leads to a kind of exit of the world, where reality and illusion are indistinguishable. Science fiction literature plays here in the field of metaphors but more seriously it indicates us which are the fears of our contemporaries. To permanently transform the bodies is like to transform the individuals in such a way they must adapt continuously to the technological and organisational changes. Moreover, it is also to take the risk of derealisation and of major identitary disorders.

These concerns are not absurd fictional dreams and, according to us, deserve to be taken seriously. The work of Alain Ehrenberg (cf Le culte de la performance) shows that new representations of individuals appear in the world of sport, work or even vacation – flexibility, competition, performance, self fulfillment – which are linked, in very subtle ways, to this pathology of action that is depression. Thus, it’s not astonishing that the depression can be described as the disease of the beginning of present millenium in the sense it is the negative consequence of the new identities based on the obligation to act. All this shows again that it is definitely impossible to discuss the ” impacts ” of new technologies without studying the concomitant development of the imaginary revealed by sociological interviews, official reports or fiction.

A Gendered Future of the Computer Profession

AUTHOR

Eva Turner (UK) and Annemieke Craig (Australia)

ABSTRACT

Aims

The aim of this paper is to establish whether the future generation of computer professionals enter the computing higher education with ideas about their future profession, which is already defined as very narrow and gendered. If that is the case, the paper will elaborate on whether there is ethical responsibility of computer educators to broaden those views and how that should be done.

A large-scale research was performed to gain an insight into perceptions future computer professionals hold of the status and gender of the category of employment loosely defined under this term of “a computer professional”. An international team of researchers from Australia, England and USA and South Africa gave a large questionnaire to all first year students on Computing and Information Technology degree programs, who were enrolled on introductory programming courses at universities.

This paper outlines preliminary findings of this research, from two of the five countries – Australia and England. The paper elaborates on the results’ relevance to current state of the computing profession and outlines further steps that need to be taken to enlighten the computing educators as well as the profession itself to bring about equal opportunities within the computing industry.

Findings
Generally men and women gave similar reasons for studying a computer related degree. An interesting observation is that men seemed to have been more influenced by their family than women about their choice of university studies and only very few students received advice from a careers counsellor.

As opposed to men, women were more inclined to say that they came from word processing and package using background; they did not play games and did not show much experience in programming before entering their studies.

There appear to be recognisable patterns of gender stereotyping in the perception of the computer profession itself. While all students want to become computer professionals and associate the profession with money and status, there appear to be entrenched gendered classification of their own pre university computer experience as well as gendered perception of the profession itself. It appears that most students did not really have a firmed idea of what a computer professional does. However it is obvious that their idea of computer profession does not include administrative job categories. The computing industry represents to the students mainly production of software and hardware.

Women students believed stronger than men that technical as well as communication and management skills are important and that a computer professional needs to be a good programmer and needs a very good understanding of mathematical concepts. This belief tends to eliminated all students without “technical” or mathematical skills, but stereotypically mainly women, from wanting to enter the profession in the first place.

Though all students believed that computing is an engineering discipline, women believed also that computing is a multidisciplinary discipline. Both genders believed that most computer professionals are men and that it did not matter that the numbers of men are greater than the numbers of women. While more women than men believed that as computer professionals they are likely to have to make ethical decisions, most students indicated ambivalence to this statement.

As to students perceiving individual computing disciplines as gendered, the results in this survey appear to confirm my previous findings in students just leaving the university (Turner, 2000), that students are prepared to gender disciplines and genuinely take these perceptions with them into their working lives. These in turn influence their decision making about their own lives as well as lives of those they will potentially employ.

Conclusion

The paper will elaborate on the reasons for the need to change students perceptions and attitudes and will outline how and where in the student education these changes can take place.

REFERENCES

Camp, Tracy (1997) “The Incredibly Shrinking Pipeline” in Communications of the ACM, October, 1997,v40, no 10, pp.103-100.

Frenkel, Karen A. (1990) “Women and computing” in Communications of the ACM, November 1990, v33, n11, p.34 (13).

Grundy F. (1998),’Computer Engineering: Engineering What?’ AISB Quarterly, Issue 100, Pp.24-31

Huang, Ring, Toich, Torres, 1998 “Computers In the Classroom: What is the Effect on the Gender Gap?” GREAT, Vol.1, Issue 1, March 16, 1998.

Lemons M., Parzinger M (2001), Designing Women: A qualitative Study of the Glass Ceiling for Women in Technology. SAM Advanced Management Journal, v66, I2, p4.

Mayfield, Kendra (2000) “Why Girls Don’t Compute”, Wired Magazine, http://www.wired.com/news/print/0,1294,35654,00.html, April 20, 2000.

Robertson, M; Newell, S; Swan, J; Mathiassen, L; and Bjerkness, G (2001). The issue of gender within computing: reflections from the UK and Scandinavia. Information Systems Journal. Vol. 11 Issue 2, p111

Schumacher P. & Morahan-Martin J (2001), Gender, Internet and computer attitudes and experiences, Computers in Human behaviour v17 p95-110.

Turner, E (2000), Is There Such a Thing as Gender and Ethnicity of Computing? In Journal if Information Ethics, vol.9, no.2., pp 72-81.

Turner E. and Roberts P. (2001), Teaching Ethics to IT Students in Higher Education: Provision, Perspective and Practice, in Bynum T. et al (2001), The Social and Ethical Impacts of Information and Communication Technologies, Proceedings Ethicomp 2001 Conference, Wydawnictwo Mikom, Poland

Turner E. (2001), The Case of Responsibility of the IT Industry to Promote Equality for Women in Computing, in Science and Engineering Ethics Journal, vol.7, pp 247-260

Twomey T (1995), Software Industry Structure or Chaos, in Myers C. (1995), Professional Awareness in Software Engineering, McGraw-Hill.

Von Hellens L, Nielsen S (2001), Australian Women in IT, Communications of the ACM, July, v44 i7 p46.

Young, B. (2000), Gender Differences in Student Attitudes toward Computers, Journal of Research on Computing in Education, Winter2000, Vol. 33 Issue 2, p204

Wright R. (1997), Women Computer Professionals, Progress and Resistance, The Edwin Mellen Press Ltd.

Education for Ethics

AUTHOR

Andy Bissett (UK)

ABSTRACT

Teaching ethical issues to technologists and scientists has been hampered by excessive subject specialisation. Science and technology education tends to concentrate on the facts and methods, whilst leaving the ethical aspect of their application mostly untouched. Professor Germaine Greer at a recent lecture on human ageing [2001] bemoaned the onward march of what she labelled ‘nerd science’, which she identified as the product of this emphasis – the focus on facts and technique without the possibility of taking into account the uses to which science and technology may be put. The humanities on the other hand have frequently been concerned with ethical issues, but can lack an understanding of science and technology. Both the arts and the sciences lose out as a result of this cultural gap.

It is now slightly more than forty years since the English physicist-turned-novelist C.P. Snow delivered a famous and controversial lecture at Cambridge University in which he identified this gap in the Western world between humanities and science, and delineated some of its consequences (reprinted in [Snow, 1971]). He called this disjunction between arts and sciences ‘The Two Cultures’. At the time at which this lecture appeared, approximately 3% of the population of the UK received a university education. This proportion of the population has now risen to more than 30%. The UK government has stated its intention that by the year 2005 at least 50% of the population will attend university. The consequent pressures on the education system to deliver science and technology that can compete globally and be relevant to economic activity have, if anything increased this subject specialisation over the last two decades. This is an issue, which seems to afflict most of the Western education systems.

Snow wrote a lengthy series of novels and a number of polemical articles exploring the tensions and problems of this gulf between subject specialisms. In his fictional output, Snow was concerned with the ethical aspects of science, public policy, and government; indeed one novel was devoted to the issue of scientists’ role in the development of nuclear weapons [Snow, 1954]. He evinced a Wellsian belief in the progressive rationality of science, and the liberating possibilities of modern technology. Broadly, his solution for these ethical and social problems involved a re-alignment of the education system to help bridge the gap between subject specialisms, and to meet the needs of the last third of the twentieth century. The present paper examines his work and relates it to the problem of developing education in good ethical practice for IT students in the twenty-first century.

Ironically, whilst Snow the physicist wrote very conventional novels, eschewing literary experimentation or sophistication [Karl, 1963], Western literature and visual arts have subsequently shown a burgeoning and imaginative awareness of the apparent paradoxes and mysteries inherent in modern physics and mathematics (see, for example, [McEwan, 1988], [Stoppard, 1999]). However, education in ethics for scientists and technologists may not simply benefit from a widening or interchange with the humanities. In the theoretical humanities post-modernism has problematised the notion of universally applicable ethics. Post-modernism maintains that absolute values no longer apply (if they ever did), and that any number of competing discourses must be evaluated and considered as a potential guides to moral behaviour. Prima facie, these discourses are of equal weight. This opens up questions for the computer ethicist, such as: what framework (or discourse) is implied by the concept of ‘computer ethics’; do professional codes of conduct imply a particular set of values; how do we evaluate different discourses; can a meta-framework be proposed within the specific field of computer ethics for evaluating different discourses?

These problems are not merely at the theoretical level; earlier empirical work, based on the ideas of the psychologist Carol Gilligan, has shown that different ethical evaluations (discourses) do indeed hold in practice [Bissett & Shipton, 1999].

This paper concludes that one helpful way forward may be a reconsideration of work that was contemporaneous with Snow’s later writings. Thomas Kuhn [1962] opened up the possibility of viewing science as a social process as well as a technical process. Kuhn’s reinstatement to science of its dimension as a social and historical practice can be extended to readily capture the ethical dimension. An especial advantage to be gained here is that scientific education and understanding is itself enriched by restoring the social dimension. The synergy in this more holistic treatment is too good to miss. Both scientific education per se and education as to the ethical dimension of science may benefit.

Intelligent Medical Systems

AUTHOR

Heidi King, Jon Garibaldi and Simon Rogerson (UK)

ABSTRACT

Introduction

This paper discusses the status of intelligent computer systems in medicine. A definition of intelligent systems will be given, and an explanation of how these systems differ from other software. The relationship between a clinician and an intelligent system will then be examined, in order to decide whether an intelligent system should be regarded as a partner or a tool. The question of whether intelligent systems provide better care for patients than clinicians will be analysed. Finally, an ethical analysis will be made of whether clinicians should be required to take advice from intelligent systems that could provide better care than they themselves.

Background

Few intelligent systems are actually used routinely in medicine (King et al, 2001). The Vienna General Hospital has within it a group of researchers working in the field of intelligent systems. This research group has produced six fully functional expert systems that are routinely used within the hospital. Previous has shown that this is the most prolific research group world wide in implementing intelligent systems into routine use in a medical environment. This research is concerned with understanding the issues faced by a range of clinicians associated with the Vienna General Hospital with respect to the usage of intelligent computer systems in medicine within their fields of expertise.

Defining Intelligent Systems

Intelligent systems are based upon Artificial Intelligence (AI). A widely accepted definition of AI is one given by Marvin Minsky in 1968: “Artificial intelligence is the science of making machines do things that would require intelligence if done by men”. An ‘ordinary’ computer will follow a set of instructions in a specified order to complete a task. Intelligent systems often have learning capabilities and use computing power to attempt to model human thought processes.

Intelligent systems have been created for many and varied uses. They may be programmed to detect the onset of adverse conditions and alert medical personnel to changes in the patient’s state, for example the “Sentinel” anaesthesia monitor (Jones et al, 2001) provides automated decision support for anaesthesia monitoring. Another use may be to advise on medical practice, e.g. the ICONS system suggests an antibiotic therapy regimen satisfying medical and economic conditions using a process of finding similar cases that have been previously documented and modifying them to meet the requirements of the current patient (Heindl et al, 1997).

It will be necessary, for the purposes of this paper, to specify the characteristics of a ‘typical’ intelligent system. These characteristics can then be examined in order to consider whether this ‘typical’ intelligent system could be considered as a partner or a tool. Future research will examine specific instances of intelligent systems to see how they compare with this ‘typical’ model, and whether these specific examples should be considered as partners or tools. The research concludes by considering whether intelligent systems are different to other types of systems and whether this means they should be treated differently.

Clinician-System relationship

Merriam-Webster’s dictionary definitions of a tool include “something (as an instrument or apparatus) used in performing an operation or necessary in the practice of a vocation or profession”. A partnership between two partners is understood to mean a relationship “usually involving close cooperation between parties having specified and joint rights and responsibilities”. The relationship between a clinician and a specified ‘typical’ intelligent system will be examined, in order to decide whether that system should be regarded as a partner, a tool, or a hybrid of the two.

Some studies have shown intelligent systems to provide better care than clinicians for patients (e.g. Hamilton et al, 1996; Narus et al, 1995; Scott, 1999). Johnson & Mulvey (1995) argued that computer decision systems give assistance in coping with complexity, enabling decision making to be more informed. The field of knowledge in medicine is enormous and so support may be essential for clinicians to do their jobs effectively.

Clinicians have a duty to treat and care for their patients to the best of their abilities (the principle of beneficence). The General Medical Council (GMC) in the UK considers that one of the duties of a doctor registered with the GMC is to “work with colleagues in the ways that best serve patients’ interests”. If an intelligent system is to be considered as a partner, and if that intelligent system is able to provide the best possible care for patients, it can be argued that clinicians have a duty to use these systems whenever possible. At present there is no mention made to intelligent, or other, computer systems within the GMC’s standards of practice. This is an example of Moor’s policy vacuum (Moor, 1985) whereby advances in technology provide users with new capabilities without ethical policies having been formulated to guide those users in their conduct.

REFERENCES

Hamilton, P. W., Anderson, N. H., Diamond, J., Bartels, P. H., Gregg, J. B., Thompson, D. & Millar, R. J. (1996) An interactive decision support system for breast fine needle aspiration cytology. Analytical and Quantitative Cytology and Histology 18,3:185-190

Heindl, B., Schmidt, R., Schmid, G., Haller, M., Pfaller, P., Gierl, L. & Pollwein, B. (1997) A case-based consiliarius for therapy recommendation (ICONS): computer-based advice for calculated antibiotic therapy in intensive care medicine. Computer Methods and Programs in Biomedicine 52,2:117-127

Johnson, D. G. & Mulvey, J. M. (1995) Accountability and Computer Decision Systems. Communications of the ACM 38, 12: 58-64

Jones, R. W., Harrison, M. J. & Lowe, A. (2001) Computerised anaesthesia monitoring using fuzzy trend templates. Artificial Intelligence in Medicine 21,1-3:247-251

King, H., Garibaldi, J. & Rogerson, S. (2001) Towards the identification of intelligent systems currently in routine use in medicine and dentistry. Proceedings of the Eusflat Conference 5-7 September, 2001

Moor, J. (1985), What is computer ethics? Metaphilosophy 16,4: 266-279

Narus, S. P., Kuck, K. & Westenskow, D. R., (1995) Intelligent monitor for an anesthesia breathing circuit. Proceedings of the Annual Symposium on Computer Application in Medical Care;96-100

Scott, J. A. (1999) Using artificial neural network analysis of global ventilation-perfusion scan morphometry as a diagnostic tool. American Journal of Roentgenology 173,4:943-948

Individual learning and organizational change for ethical competence in the use of information technology tools

AUTHOR

Iordanis Kavathatzopoulos, Jenny Persson and Carl Åborg (Sweden)

ABSTRACT

Any successful construction, implementation and use of information technology systems require many different things. Satisfaction of economical and technological aspects used to (and still are) in focus, but today other aspects such as organizational structure and dynamics, work environment, work task, user competence, even ethical issues, take a bigger part in the way a system functions. In this paper we focus on ethical competence and discuss how this can be achieved and maintained in a highly changing work environment dominated by the use of IT-tools. Ethical competence is an important emerging factor determining the optimal use of information technology systems.

In order to be able to use a system satisfactorily a certain kind and amount of knowledge is necessary. Knowledge is always connected to the solution of a concrete problem. It guides action, and effective action is adaptive knowledge. In this sense knowledge that does not fit in to a concrete situation is in fact not any knowledge for this situation. A user or a group of users lacking necessary knowledge are in a state of cognitive disequilibrium.

Organizations exist in order to coordinate knowledge and competence. A successful orchestration of knowledge means effective action. If a knowledge gap is observed, organizations try to fill it. One way to accomplish this is to inform, educate and train people. However, it is necessary for this process to succeed, to be able to anticipate future problems in real situations, which demand concrete knowledge. Any demand for future knowledge has then to be compared to the existing knowledge and expertise in the organization. In principle this is what is needed for the construction of introductory courses and other means of assistance for users such as ethical codes.

However, given the high pace of technological change as well as the number and interdependence of factors influencing the optimal use of a system, it is very difficult to anticipate future problems and to identify the corresponding knowledge necessary to solve them. This is certainly true regarding ethical knowledge. It is extremely difficult to know in advance what is right and what is wrong, and therefore it is difficult to supply adaptive and functional answers. Every knowledge transmission and cognitive support method, such as ethical codes, which are constructed in advance and before the problem they target has emerged, may not be sufficient. Such methods include knowledge for handling already known problems, or when there is a clear and concrete picture of a future moral problem.

Then how is adaptive ethical knowledge achieved? The person or the organization, which needs this knowledge, has of course to find the right method to create the ethical knowledge needed. The person needs a psychological skill and the organization needs suitable routines and processes, that is, ethical competence. Individual skills are by definition applicable to an infinite number of problems of the same kind, in this case moral problems. Organizations use to find the knowledge needed in certain problem situations by reorganizing themselves spontaneously. The great advantage with informal cognitive support, above and beyond its applicability, is that knowledge transmitted in this way aims the target easily, and therefore it is accepted and applied successfully.

Ethical competence is defined here as a psychological and organizational process which means (a) high ethical awareness, the ability to anticipate moral problems in real life and to perceive them in time, (b) the skill to analyse and solve them in an optimal way, (c) the individual capability and the organizational readiness to discuss and handle moral problems at group and organization level, and together with significant others formulate ethical guidelines, (d) the power to argue convincingly for preferred actions or decisions made, and (e) the confidence on own ability to cope with moral problems and the emotional strength to implement controversial decisions.

In the present paper we will present an investigation of measures taken before and during the implementation process of a new information technology system at a large government organization. The organization’s size and the diversity of measures taken or simply not be taken allow us to compare some very important factors. The focus of the study is mainly on the effect of individual skill training and learning on the acquisition of ethical competence. Furthermore the focus is on organizational change promoting informal processes in handling ethical issues. Some other important parameters that are studied are the correlations of ethical competence to work environment and to the efficiency and effectiveness of the information technology system.