1/16: Information Systems in Business What is IS? How can we use IS?
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Transcript of 1/16: Information Systems in Business What is IS? How can we use IS?
What is IS? Information vs. Data
• Information can be defined as:– Data that have been processed into a form that is
meaningful and useful to human beings.
• Data can be defined as:– Raw facts representing events in
organizations or the environmentbefore they are processed into a useful form.
What is an IS? Information System
• An Information System can be defined as:– Interrelated components working together to collect,
process, store, and disseminate information to support decision making, coordination, control, analysis, and visualization in an organization.
What is IS? Input, Process, Output
• Input: collection of raw data for processing.
• Processing: conversion of data into information.
• Output: distribution of information to people or places that will use it.
• Feedback: output returned to modify inputs.
INPUT OUTPUTPROCESS
FEEDBACK
What is IS? Business Perspective• An organizational and management solution,
based on information technology, to a challenge posed by the environment.
• NOT JUST COMPUTER TECHNOLOGY
ORGANIZATIONSORGANIZATIONS TECHNOLOGYTECHNOLOGY
MANAGEMENTMANAGEMENT
INFORMATIONINFORMATION
SYSTEMSSYSTEMS
How can we use IS?
• Scope of IS grows constantly– 1950s: affect automation of clerical activities– 1970s: affect managerial control & monitoring– 1990s: affect core activities
Using IS: Networking Work
• Flattening organizations
• Telecommuting
• Virtual organizations
• Internet– A network of networks – World Wide Web, Email, FTP, eCommerce, etc.
• Intranet– Private network based on Internet & WWW standards
Using IS: Increasing Efficiency
• Improving work flows
• Increasing organizational flexibility– Mass customization– Micromarketing
• Increasing communication
• Expanding organizational boundaries
Using IS: eCommerce
• Electronic market: an IS that links buyers and sellers to exchange products, services, information, and payments.
• Electronic commerce: buying & selling goods & services using the Internet, networks, and other digital technologies.
• Electronic business: includes eCommerce & other business functions.
IS Parts: IT Infrastructure
• Hardware: physical equipment
• Software: programs & instructions that guide the computer
• Storage: Media & software governing it
• Communications: physical devices & software
Image courtesy of Tiger Direct
IS Parts: Organizations
• Made of different functions working together for a common goal
• Business functions:– Sales & marketing– Production – Finance– Accounting– Human resources
IS Parts: Organizations
• In these functional areas, we find different kinds of workers:– Knowledge workers– Data workers– Production (or service) workers
IS Parts: Management
• Senior managers: create long-range plans
• Middle managers: carry out plans
• Operational managers: day-to-day
Key System Apps in Orgs: Groups
Strategic Level: Senior Managers
Management Level: Middle Managers
Knowledge Level: Knowledge & Data Workers
Operational Level: Operational Managers
Sales & Manufacturing Finance Accounting HumanMarketing Resources
Six Major Types of Systems
• ESS: Executive Support System
• MIS: Management Information System
• DSS: Decision Support System
• KWS: Knowledge Work Systems
• OAS: Office Automation Systems
• TPS: Transaction Processing Systems
Sales & Manufacturing Finance Accounting HumanMarketing Resources
Major Types of Systems: TPS
• Transaction Processing Systems
• Processing routine activities of the organization– Hotel reservations– Grade submissions– Employee records
• Operational level
Sales & Manufacturing Finance Accounting HumanMarketing Resources
Major Types of Systems: OAS
• Office Automation Systems
• Knowledge Level– Scheduling meetings– Desktop publishing – Document imaging systems– Presentation graphics development
Sales & Manufacturing Finance Accounting HumanMarketing Resources
Major Types of Systems: KWS
• Knowledge Work Systems
• Knowledge Level– CAD: Computer Aided Design– Modeling– Graphics development
Sales & Manufacturing Finance Accounting HumanMarketing Resources
Major Types of Systems: MIS
• Management Information Systems
• Provides reports
• Provides access to current performance
• Aids planning, controlling, & decision making
• Usually inflexible, predefined reports
• Management level
Sales & Manufacturing Finance Accounting HumanMarketing Resources
Major Types of Systems: DSS
• Decision Support Systems
• Combine data & modeling tools to aid non-routine decision-making
• Interactive, flexible
• “What if” analysis
• Management level
Sales & Manufacturing Finance Accounting HumanMarketing Resources
Major Types of Systems: ESS
• Executive Support Systems
• Incorporates external data with internal data
• Creates projections
• Designed to help answer questions like, “What business should we be in? Which business units should we sell off?”
• Strategic Level
Organizations & IS
• What is an organization?
• How can IS affect an organization?
• Features of organizations– SOPs– Politics– Culture– Organizational Type– Environment– Goals– Business Processes -- cross-functional
How IS Affects Organizations
• Economic theory– microeconomic model of the firm: IT as factor of
production• As price of IT falls, IT use goes up, decreasing labor or
capital costs.
• Behavioral Theory– decision-making hierarchy
• IT increases flow of information, thereby encouraging self-managed workers
Strategic Role of IS
• What makes an IS strategic?– An IS is strategic if it changes goals, operations,
products, services, or environmental relationships to help the organization gain a competitive advantage.
– A strategic IS keeps an organization ahead of the competition.
Role of Managers in Organizations
• Behavioral Model: Managerial Roles– Interpersonal roles:
• motivate, counsel, support, liaison, act as figureheads
– Informational roles:• act as nerve center, distribute information, act as
spokespersons
– Decisional roles:• initiate new activities, handle disturbances, allocate
resources, negotiate & mediate conflicts.
IS Helps Managers in their Roles
• Interpersonal:– Liaison -- electronic communication
systems
• Informational:– Nerve center -- Management Information Systems
Disseminator -- Mail, office systemsSpokesperson -- Office & professional systems,
workstations
• Decisional:– Resource allocator – Decision Support Systems
IS Systems for Decision MakingOperational Knowledge Management Strategic
Uns
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TPS
ESS
DSS
MISOfficeSystems
KWS
IS? IT? MIS? ITS? Department
• New department: IS– responsible for maintaining hardware, software, data
storage, and networks that make up the IT infrastructure
– programmers, system analysts, IS managers– Other individuals: CIO, end users
IS Membership
• Programmers– Highly trained technical specialists
who write computer software instructions
• Systems Analysts– Specialists who translate business problems and
requirements into information requirements and systems; they act as liaisons between the IS department and the rest of the firm
• IS Managers– Leaders of the IS specialists