ADMS 2511 – Management Information Systems

Chapter 1:

The Importance of Planning for IT

- Need for information systems is usually related to organizational planning and to analysis organization performance compared to competitors

- A potential IT system can be applied to the whole organization or a particular function or application area

- Application portfolios: applications that have to be added, or modified if they already exist

IT planning

- Begins w/ analysis of organizational strategic plan

- Strategic planning states the firm’s overall mission, goals that follow that mission and the steps necessary to reach these goals

- Strategic planning modifies organization’s objectives + resources to meet changing markets and opportunities

- Includes both technical and managerial aspects of information systems

- Technical: hardware and operating systems, networking, data management systems and applications software

- Managerial: specifies how managing the IT department will be accomplished, how functional area managers will be involved and how IT decision will be made

- IT Strategic Plan: set of long-range goals that describe the IT infrastructure and identify major IT initiatives needed to achieve organization’s goals

o it must meet 3 objectives:

must be aligned w/ organization strategic plan

must provide for an IT architecture that enables users, applications and databases to be seamlessly networked and integrated

must efficiently allocate IS development resources among competing projects so the projects can be completed on time and within budget and have the required functionality

- IT Steering Committee: a group comprised of a group of managers and staff that represent various organization units.

o it establishes IT priorities and ensures MIS functions are meeting enterprise’s

needs

o links corporate strategy and IT strategy

o approve allocation of MIS function

o establish performance measures for the MIS function and ensure they are met

o ensures information systems and applications are acquired so employees get the

resources they need to do their job

- IS operational plan: plan consists of a clear set of projects that the IS department and functional area managers will execute in support of IT strategic plan

o Contains following elements:

Mission – mission of IS function (derived from IT strategy)

IS environment – summary of the information needs of the functional areas and of the organization as a whole

Objectives of the IS function – the best current estimate of the goals of the IS function

Constraints on the IS function – technological, financial, personnel, and other resource limitations on the IS function

Application portfolio – prioritized inventory of present application and a detailed plan of projects to be developed or continued during the current year

Resource allocation and project management – listing of who is going to do what, how, and when

Business Processes And Business Process Management

- Business process: collection of related activities that produce a product or a service of a value to the organization, its business partners and/or its customers

o Cross functional areas in an organization (product development, which involves

design, engineering, manufacturing, marketing and distribution)

o Must consider the following:

Customer Satisfaction: result of improving, fulfilling customer’s needs, wants and desires

Cost Reduction: result of having more efficient operating and supplying processes

Cycle and fulfillment time: result of having better manufacturing and product management processes

Quality: result of improving design, development and production

Product differentiation: result of having effective marketing and innovating processes

Productivity: result of improving each individual’s work processes

- Business process reengineering (BPR): approach that improves efficiency and effectiveness of an organization’s business processes

- Business Process Management (BPM): management technique that includes methods and tools to support the design, analysis, implementation, management and optimization of business processes

o Helps improve profitability by decreasing costs and increasing revenues

o Creates a competitive advantage by improving organizational flexibility and

provide cost benefits and increase customer satisfaction

Information Systems: Concepts and Definitions (pg 11)

Data, Information, Knowledge

- Data items: refers to an elementary description of things, events, activities and transactions that are recorded, classified and stored but not organized. Can be numbers, letters, figures, sounds, images, etc

- Information: refers to data that has been organized so they have meaning and value

- Knowledge: data and information that is organized and has been processed to convey understanding, experience, etc

Information Technology Architecture:

- High level plan or map that has information assets in an organization

- Integrates entire organization’s business needs for information and IT infrastructure and all applications

Information Technology Infrastructure:

- Consists of physical facilities, IT components, IT services and IT personnel that support the entire organization

Global, Web-Based Platform

- Internet allows individuals to connect, compute, communicate, collaborate and compete everywhere and anywhere, anytime, provides limitless access to information

- Globalization: integration and interdependence of economic, social, cultural and ecological facets of life, enabled by rapid advances in information technology

Three Stages of Globalization (pg 14)

1) Globalization 1.0 (1942 to 1800) – force behind globalization was how much muscle, horsepower, wind power, steam power a country had and could deploy

2) Globalization 2.0 (1800 to 2000) – MNCs, due to falling transportation costs, generated by development of steam engine and railroads

o Second half was driving by falling telecommunication costs resulting from

telegraphs, telephones, computers, etc

3) Globalization 3.0 (2000 - ) – result of Fridman’s ten flatteners

o 1) Fall of Berlin Wall

o 2)Netscape goes public 1995

o 3) Development of workflow software – computers were able to work w/ one

another w/o human intervention, allowed for humans to coordinate amongst employees regardless of location

o 4) Uploading

o 5) Outsourcing

o 6) Offshoring

o 7) Supply chaining – networks composed of companies, their suppliers and their

customers

o 8) Insourcing –delegating operations of jobs within a business to another

company that specializes in those operations

o 9) Informing – ability to search for information

o 10) The steroids –computing, instant messaging, file sharing, technology that

amplifies other flatteners

Business Pressures, Organizational Responses and IT support

Business Pressures:

- Combination of political, social, legal, economical, and physical factors that affect business activities

- Market Pressures: generated by global economy and strong competition, changing nature of the workforce and powerful customers

o Global economy and strong competition: regional agreements such as NAFTA

and unification of European nations has been it easier to increased world trade, the emergence of China and India has cause increased global competition

Due to the higher cost of labour in developed countries, companies will outsource to less developed countries to cut down on costs

o The Need for Real-Time Operations: immediate access/processing of information

o The changing nature of the workforce: more diversity, increased numbers in

women, single parents, minorities, people w/ disabilities

o Powerful Customers: customers are becoming more knowledgeable due to the

internet

- Technology Pressures:

o Technological Innovation and Obsolescence: new and improved technologies are

being produced more often at a rapid rate

o Information Overload: information on the internet doubles each year

- Social, Political and Legal Pressures

o Social Responsibility: issues that affect businesses and individuals range from

the state of physical environment to company and individual philanthropy (CSR)

Digital divide: the gap between those who have access to information and communication technology and those who do not

o Compliance w/ Gov’t Regulations and Deregulations: gov’t regulations may

include; health, safety, environmental control, employment equilty, etc

Deregulation can include local gov’t imposing income taxes, payroll/health taxes, sales taxes

o Protection against Fraud or Terrorist Attacks

Organizational Responses (pg 21)

- Organizations are responding to pressures by implementing IT such as strategic systems, customer focus and make-to-order and mass customization and e-business

- Strategic Systems:

o Provides organizations w/ advantages that enable them to increase market

share/profits to better negotiate w/ suppliers and to prevent competitors from entering their market

- Customer Focus

- E-Business and E-Commerce

Chapter 2:

Information Technology Governance and Management

IT Governance: a structure of relationships and processes to direct and control the enterprise in order to achieve the enterprise’s goals by adding value while balancing risk versus return over IT and its processes

Types and Purpose of Information Systems

Information System (IS): collects, processes, stores, analyzes and disseminates information for a specific purpose

Computer Based information system (CBIS): uses computer technology to perform all its tasks

Hardware: device such as the processor, monitor, keyboard, printer that together accept data and information, process and display it

Software: program or collection of programs that enables the hardware to process data

Database: collection of related files or tables containing data

Network: connecting system that permits different computers to share resources

Procedures: set of instructions about how to combine the above components in order to process information and generate the desired output

People: individuals who use the hardware and software, interface with it, or use its output

Application Programs (pg 41)

- Computer program designed to support a specific task, business process

Breadth of Support of Information Systems

- Functional area information systems (FAIS): each information system supports a particular functional area in the organization

- Enterprise resource planning (ERP): designed to correct lack of communication among functional area ISs

- Transaction processing system (TPS): supports monitoring, collection, storage and processing of data from the organization’s basic business transactions

- Supply chain: describes the flow of materials, information, money, and services from suppliers of raw material through factories and warehouses to the end customers

- Electronic Commerce Systems: enables organizations to conduct transactions between businesses, customers

Support for Organizational Employees (p 43-45)

Knowledge workers: professional employees such as financial/marketing analysts, engineers, lawyers, accountants

Office automated systems (OASs): support for clerical staff, lower and middle managers and knowledge workers

- Used to develop documents (word processing), scheduling, and communicating (e-mail, IM)

Business Intelligence (BI) systems: computer support for complex, non-routine decisions, used by middle managers and knowledge workers

- Used w/ a data warehouse and allows for data analysis

Expert systems (ESs): attempt to duplicate work of human experts by applying reasoning capabilities, knowledge and expertise within a specific domain, used by knowledge workers

Functional area IS: supports activities within a specific functional area (i.e. system for payroll)

Enterprise Resource Planning: integrates all functional areas of the organization (i.e. Oracle, SAP)

Management Information System: produces reports summarized from transaction data, usually in one functional area (i.e. report on total sales for each customer)

Decision support system: provides access to data and analysis tools (i.e. “what-if” analysis and changes in budgets)

Dashboards: support all managers of the organization. Provides rapid access to timely information and direct access to structure information (reports)

Competitive Advantage and Strategic Information Systems

Competitive advantage: seeks to outperform competitors in some measure such as costs, quality or speed

Strategic information systems (SISs): provide a competitive advantage by helping an organization implement its strategic goals and increase its performance and productivity

- Any information system that helps an organization gain a competitive advantage or reduce a competitive disadvantage is a strategic information system

Porter’s Competitive Forces Model:

1) Threat of entry of new competitors

2) Bargaining power of suppliers

3) Bargaining power of customers (buyers)

4) Threat of substitute products or services

5) Rivalry among existing firms in the industry

Porter’s Value Chain Model (pg 48)

Primary activities:

1) Inbound logistics (inputs)

2) Operations (manufacturing and testing)

3) Outbound logistics (storage and distribution)

4) Marketing and sales

5) After sales services

Support activities:

1) Firm’s infrastructure (accounting, finance, management)

2) HRM

3) Product and technology R&D

4) Procurement

Value system (industry value chain): include suppliers that provide inputs necessary to the firm and their value chains

- Once the firm creates products, these products pass through value chains of distributors and then to the customers

Strategies for Competitive Advantage

1) Cost Leadership Strategy: produce products and services at the lowest cost in the industry

2) Differentiation strategy: offer different products, services, product features

3) Innovation strategy: introduce new products and services, add new features to existing products and services and develop new ways to produce tem

4) Operational effectiveness strategy: improve the manner which internal business processes are executed so a firm performs similar activities better than its rivals (better quality, productive, employee + customer satisfaction)

5) Customer Orientation Strategy: concentrate on satisfying the customer

The Importance of Information Systems and their Management (pg 51)

IT Affects Management:

Reduction of middle managers:

- IT makes managers more productive therefore

IT Affects Employees:

1) IT affects employees perceptions of job security – some people are concerned that technologies are going to replace workforce, but they can also create new jobs

2) IT creates psychological effects – employees feel like they are losing their identity because of the isolating effect of IT

3) IT affects employees’ Health and Safety – increases in workload due to IT can lead to job stress, VDTs and keyboards can effect wrists and eye damages

4) IT provides opportunities for people w/ disabilities – by offering speech and vision recognition, it allows disabled employees to have capabilities

Chapter 3

Ethical Issues (pg 70)

Ethics: principles of right and wrong that individuals use to make choices to guild their behaviours.

Code of ethics: collection of principles that is intended to guild decision making by members of the organization

Responsibility: accepting the consequences of your decisions and actions

Accountability: determining who is responsible for actions that are being taken

Liability: gives individuals the right to recover the damages done to them by other individuals, organizations, systems

Ethical Issues Categories:

Privacy: collecting, storing, disseminating information about individuals

Accuracy: involves the authenticity, integrity and accuracy of information that is collected and processed

Property: ownership and value of information

Accessibility: who should have access to information and whether they should pay to have this access

Protecting Privacy

Privacy: - right of privacy is not absolute; privacy must be balanced against the needs of society

- Public’s right to know supersedes individual’s right to privacy

Digital Dossier: electronic description of a person’s habits on the internet

Profiling: process of forming a digital dossier

Electronic Surveillance: monitoring or tracking people’s actions with computers

- Employees have limited protection against surveillance by employers

- Monitoring and filter software is being installed to improve productivity

Privacy Codes and Policies: organization’s guidelines for protecting the privacy of customers, clients and employees

Opt-out Model: consent is given for a company to collect personal information until the customer specifically requests that the data not be collected

Opt-In Model: a business is prohibited from collected personal data unless customer specifically authorizes it

Threats to Information Security

1) Evolution of information technology resources

2) Government legislations – laws protect individuals

3) Modern computers and storage devices are becoming easier to obtain and are constantly improving allowing more people to be able to access information

4) Skills to be a hacker are decreasing

5) Cyber-crime: illegal activities taking place over computer networks

6) Downstream liability: if a hacker uses one party A’s systems to access party B’s, Party A may be liability due to the fact their security was not strong enough

7) Unmanaged devices that are out of an IT department’s control

8) Management support – management must support and enforce security measure

Threat: a danger which a system may be exposed

Exposure: harm, loss, damage that can result if a threat compromises a resource

Vulnerability: possibility that the system will suffer harm by a threat

Risk: likelihood of a threat occurring

Information systems controls: procedures, devices, software aimed at preventing a compromise to the system

Threats to Information Systems

1) Unintentional Acts

- Human Error: tailgating, shoulder surfing, careless w/ laptop, internet surfing, poor password selection, etc

- Social engineering: an attack which the perpetrator uses social skills to trick or manipulate legitimate employees into providing confidential company information

o Reverse social engineering: employers approach the attacker without any

knowledge of threat

o Social data mining: an attacker has an understanding of trusted relationships

within an organization and exploit the knowledge

- Deviations in the Quality of Service by Service Providers

- Environmental Hazards

2) Natural Disasters

3) Technical Failures – hardware and software problems

4) Management Failures: lack of funding for information security efforts and lack of interests in those efforts

5) Deliberate Acts

- Espionage, information extortion, sabotage or vandalism, theft of equipment and information, identity theft

- Compromises to intellectual property: property created by individuals/corporations that is protected under trade secret, patent and copyright laws

Cyber Terrorism and Cyber Warfare: attackers use a target’s computer systems to cause physical, real world harm or severe disruption usually to carry out a political agenda

Penetration Test: method of evaluating security of an information system by simulating an attack by a malicious perpetrator

Protecting Information Resources (pg 90-91)

Risk Management

Risk Analysis: process which an organization assesses the value of each asset being protected, estimates probability that each asset will be compromised and compares the probable costs of the asset’s being compromised with the costs of protecting that asset

Risk Mitigation: organizations take concrete action against risks, implementing controls to prevent indentified threats from occurring and developing a means of recovery should the threat become a reality

Risk Acceptance: accept potential risk, continue operating w/ no controls and absorb any damages that occur

Risk Limitation: limit risk by implementing controls that minimize impact of the threat

Risk Transference: transfer the risk by using other means to compensate for the loss, such as by purchasing insurance

Controls evaluation: an organization identifies security deficiencies and calculates the costs of implementing adequate control measures, if costs of implementing > value of asset being protect, control is not effective

Controls

- Safeguard assets, optimize the use of the organization’s resources and prevent or detect error or fraud, organizations use layers of control

- Control environment: encompasses management attitudes toward controls

- General controls: apply to more than one functional area (i.e. passwords)

- Application controls: specific to one application (i.e. payrolls)

- Physical controls: guards, fences, sensors, etc

Access Controls: restrict unauthorized individuals from using information resources, include both logical and physical controls

- Logical controls: implemented by a software (i.e. number of tries to enter a password)

- Two major functions of access controls: authentication and authorization

- Authentication: determines the identity of the person requiring access, while Authorization provides information on what actions, rights, privileges can be performed based on identity

- Strong passwords: should be difficult, long, combination of upper, lowercase, numbers, not be a recognizable word

Communication Controls: secure movement of data across a network. Consists of firewalls, anti-malware systems, whitelisting, blacklisting, etc

- Firewall: system that prevents a specific type of information from moving between untrusted networks

o Demilitarized zone (DMZ): located between two firewalls

- Whitelisting: process where company identifies which software it will allow to run, permits acceptable software to run and prevents anything else or new software to run

- Blacklisting: includes certain types of software that are not allowed to be runned

- Encryption: process of converting an original message into a form that cannot be read by anyone except the intended receiver, all encryption uses a key

- Virtual private network (VPN): private network that uses a public network to connect users

- Secure socket layer (transport layer security): encryption standard used for secure transactions (credit card, on-line banking)

- Vulnerability Management Systems: handle security vulnerabilities on unmanaged remote devices

- Employee Monitoring Systems: companies monitor employee’s computers, e-mail and internet activity

Application Controls: security measures that protect specific applications, input controls, processing controls and output controls

- Input controls: programmed routines that edit input data for errors before they are processed (i.e. making sure SIN numbers do not have letters)

- Processing controls: routines that perform actions part of record keeping of an organization, reconcile and check transactions or monitor the operations of applications (i.e. matching entered quantity of goods received in the shipping area to amounts ordered)

- Output controls: edit output errors, help ensure information is going to authorized individuals (i.e. paycheques, reports are going to correct people)

Chapter 4

The Difficulties of Managing Data (pg 112)

- Amount of data increases exponentially over time

- Data comes from multiple sources; internal (corporate databases, company documents), personal (personal thoughts, opinions, experiences) and external (gov’t, corporate websites, commercial databases)

- Clickstream data: data that visitors and customers produce when they visit a website, it provides a trail of user activity, such as; patterns and behaviours

- new sources of data are being created (podcasts, blogs, etc)

- data rot: referring the difficulties of accessing data; finding a computer to read a floppy disk and avoiding physical problems to storage units of data

The Data Life Cycle

1) comes from a data source; internal, external personal

2) the data is stored in a database; data warehouse, metadata

3) data is processed to fit a data mart or data warehouse

4) perform a data analysis

5) generates a result of general knowledge that can be used to support decision making

The Database Approach

Database management system (DBMS): set of programs that provides users with tools to add, delete, access, analysis data stored in one location

- provide mechanisms for maintain the integrity of stored data, managing security and user access

- databases eliminate problems such as; entering data manually and reduction of errors because warehouse and inventory data are up-to-date and accurate

o the data can also be accessed by a larger variety of people across an

organization to examine products, customers, region, etc

- DBMS minimize; data redundancy – same data stored in different places, data isolation – applications cannot access data associated w/ other applications and data inconsistency – various copies of data that do not agree

- Maximizes; data security – data are essential to organizations, databases have extremely high security, data integrity – meets certain requirements, data independence – applications and data are independent of one another (able to access data from different applications)

The Data Hierarchy

Bit – represent the smallest unit of data a computer can process, contains only of a 0 or a 1

Byte – a group of eight bits, representing a single character (number, letter, symbol)

Field – a logical grouping of characters into a word, small group of words or an ID number

Record – logical grouping of related fields

File (table) – logical grouping of related records

Database – logical grouping of tables

Designing The Database

Data model: diagram that represents entities in the database and their relationships, previously known as a field or record

Entity: previously known as a record, is a person, place, thing, event

Attribute: characteristic or quality of a particular entity, previously called a field (customer name, employee number, product colour)

Primary key: contain at least one attribute/field that uniquely identifies records so it can be retrieved, updated and sorted (student ID number)

Secondary key: other fields of identification that do not identify record or entity w/ complete accuracy (a student’s major may be a secondary key)

Entity relationship Modeling

Entity-relationship modeling: planning and developing of a database

Entity relationship diagram: graphical representation of a database consisting of entities, attributes and relationships

Instance: representation of one particular entity (a particular student is an instance of the STUDENT entity class)

Identifiers: (primary key, attributes) instances can be used to be identifiers

One-to-one relationships: single-entity instance of one type is related to a single entity of instance of another type (student to parking permit – one student is to one parking permit)

One-to-many: represented by one entity instance to a group (i.e. class-professor, many different classes, but one professor in each class)

Many-to-many: group of entities that are related to another group of entities (student-to-class – many students, many classes)

The Relational Database Model (pg 119)

- Storage of data in two-dimensional tables where tables are related and each one contains entities (records listed in rows) and attributes (fields listed in columns)

Structured Query Languages (SQL): allows people to perform complicated searches by using relatively simple statements or keywords (Select, from, where, etc)

Query by Example (QBE): fills out a grid/template to construct a sample or description of the data he or she wants

Data Dictionary: defines the format necessary to enter the data into the database, provides information on each attribute, type of data, and values

- Provide information on how often an attribute should be updated, why it is needed in the database and which functions, applications, forms use the attribute

- Reduce chances of the same attribute being used in different applications and enable programmers to develop programs more quickly because data names are already there

Normalization: method of analyzing and reducing relational database to its more streamlined form for minimum redundancy, maximum data integrity and best processing performance (when normalized, only depends on primary key)

Data Warehouse (p 123)

- Repository of historical data organized by subject to support decision makers in the organization

- Organized by business dimension or subject: data are organized by subject (customer names, product, price, etc)

- Consistent: all data is coded in a consistent manner

- Historical: kept for many years so they can be used for trends, forecasting and making comparisons over time

- Non-volatile: data does not change once it is entered in the warehouse

- Ability to use online analytical processing: Online analytical processing (OLAP) – process of performing complex, multi-dimensional analysis of data stored in a data base, Online transaction processing (OLTP) – business transactions are processed as soon as they occur

- Multi-dimensional

- Relationship with relational databases: separate databases are combined

Advantages:

- users can access data quickly via web browsers because data is located in one place

- users can conduct extensive analysis

- users can obtain a consolidated view of organizational data

Disadvantages:

- expensive to build and maintain

- accessing data from obsolete mainframe systems can be difficult and expensive

- people from other departments may be reluctant to share data w/ other departments

- risk of a transferring of data may cause the information to change and not be accurate

Data Marts

- small data warehouse designed for the end user’s needs in a strategic business unit or department

- Data marts can cost less than $100,000 while data warehouses can cost 1 million >

- Implemented quicker, less than 90 days

- Rapid response and easier to navigate due to less data

Data Governance (pg 128)

- An approach to managing information across an entire organization, involves a formal set of business processes and policies that are designed to ensure data are handled in a certain, well-defined fashion

- Organization follows unambiguous rules for creating, collecting, handling and protecting its information

- Objective is to make information available, transparent and useful for people authorized to access

- Master Data: set of core data (customer, product, employee, vendor, location, etc)

- Transaction data: describe activities, transactions of a business

- Master data management: process that spans all organization business processes and applications, provides companies w/ ability to store, maintain and exchange, accurate “single version of the truth” for the company’s core master data

Knowledge Management (p 130)

- Process that helps organizations manipulate important knowledge that is part of the organization’s memory, usually in an unstructured format

- Knowledge: information that is contextual, relevant and actionable (information in action)

- Explicit knowledge: objective, rational, technical knowledge (i.e. policies, reports, products, goals, core competencies)

- Tacit knowledge: cumulative store of subjective or experiential learning, consists of an organization’s experiences, insights, expertise, etc

- Knowledge management systems: refers to use of modern information technologies – internet, data warehouses

o Used to cope with turnover, rapid change and downsizing by making expertise of

an organization’s human capital widely accessible

The Knowledge Management System Cycle (p132)

1. Create knowledge – created as people determine new ways of doing and developing things

2. Capture knowledge – knowledge must be identified as valuable and be represented in a reasonable way

3. Refine knowledge – knowledge must be placed in a context that can be understood, tacit and explicit knowledge work together to refine

4. Store knowledge – useful knowledge must be stored in a reasonable fashion so others can access information

5. Manage knowledge – keep the knowledge current and reviewed regularly

6. Disseminate knowledge – made available in a useful format to anyone in an organization who needs it – anytime, anywhere

Chapter 5

Network Applications (pg 144)

1) Discovery

Search Engine: computer program that searches for specific information, by keywords and reports results (i.e. Bing, Google, Yahoo)

Metasearch Engine: search several engines at once and integrate the findings of the various search engines to answer queries posted by users (i.e. Surf Wax, Metacrawler, Dogpile)

Publication of Material in Foreign Languages

- Companies should localize their content and be sensitive to the needs of people in their local markets

- To reach 80% of world’s internet users, a company should provide support in 10 languages: English, Chinese, Spanish, Japanese, German, Korean, French, Italian, Russian and Portuguese

- Companies that support translation of 10 languages or more spend up to $200,000 a year to localize information and another $50,000 to maintain their sites

Portals

- Web based, personalized gateway to information and knowledge that provides relevant information from different IT systems and the Internet using advanced search and indexing techniques

- Commercial (public) Portals: most popular, intended for diverse and broad audiences (i.e. Sympatico, MSN)

- Affinity Portals: a single point of entry to an entire community of people w/ affiliated interests such as hobby groups or political party (i.e. for alumni members of schools)

- Corporate Portals (enterprise, information, enterprise information): personalized, single point of access through a web browser to critical business information inside and outside an organization

- Industry-wide portals: serve entire industries (i.e. Trucks ) provides a database of general information of an industry

- Mobile Portals: portals that can be accessed on mobile devices

2) Communication

- E-Mail

- Web-Based Call Centres (customer care): used when a person needs to contact a software vendor for technical support

- Electronic Chat Rooms: virtual meeting place where people converse, Two types: 1) web-based (msn), 2) e-mail based (text only) called IRC (internet relay chat)

- Video Communication: Internet telephony, voice over Internet protocol (VoIP)

- Unified Communications: simplifies and integrates all forms of communications – voice, voice mail, fax, chat, e-mail, instant messaging, short message service, etc

o Allows users to communicate w/ another on a project no matter where they are

located, and can quickly locate other users, determine availability, engaging in communication session, all in real time

3) Collaboration

- Refers to the efforts by two or more entities (individuals, teams, groups, organizations) who work together accomplish certain tasks

o Work group: refers specifically to two or more individuals

- Workflow: movement of information as it flows through the sequence of steps that makes up an organization’s work procedures

o Allows for documents to be passed, and tasks and information to move from one

participant to another

o Virtual groups: group members that are working from different locations

- Virtual collaboration: refers to the use of digital technologies that enable an organization or individuals to plan design, develop, manage, research, etc.

- Crowd sourcing: refers to outsourcing a task to an undefined, generally large group of people in the form of an open call

- Synchronous: meeting at the same time, asynchronously: can’t meet at the same time

- Collaboration Software: software such as; Microsoft SharePoint, Google Docs, IBM lotus Quickr, Jive, that provide online collaboration capabilities, work-group e-mail, distributed databases, bulletin whiteboards, electronic text editing, document management, virtual meetings, IMs, etc.

o Version management: tracks changes to a document and provide features to

accommodate concurrent work (Docs, SharePoint, Jive)

o Version control: users check out documents and check them back in for each

member to edit (SharePoint, Lotus)

- Electronic Teleconferencing: use of electronic communication that allows two or more people in different locations to hold a simultaneous conference

o Disadvantage of teleconferencing; does not allow for face-to-face

communication, does not allow participants to see graphs, charts, pictures from other locations

o Videoconferencing: participants can see documents and presentations from other

locations (newest form of telepresence – costly)

- Google: 1) search application, 2) communication, show and share – allows users to share documents (Google Docs), 3) Mobile Applications, 4) appliances to “make your computer better” (Google Pack and Google Web Accelerator), 5) applications to “explore and innovate”

(Google Labs, Google Code)

Web 2.0 (pg 154)

- Loose collection of information technologies and applications and the websites that use them, encourages user participation, social interaction and collaboration

- Web 1.0 were services were online places where people could visit as services to get something done with other people, while Web 2.0 harness collective intelligence (wikis), deliver functionality services, rather than package software, feature remixable applications and data (mashups)

- AJAX (asynchronous Java Script and XML): allows portions of web pages to reload with fresh data instead of requiring the entire page to reload

- Tagging: keyword that describes pieces of information

- Blogs and Blogging: personal website that allows a creator to express his feelings or opinions

o Companies use blogs to help with marketing research and sometimes use it as a

process that allows input into their processes or products

- Wiki: website that collections information around the web that allows users to post and edit materials

o Organizations use wikis as a central repository to capture constantly updated

product features and specifications, tracking issues, resolving problems and maintain project histories

o Allows for customer, supplier and other business partner collaboration (i.e. FAQs,

guidelines – updating to make sure they’re current and accurate)

- Really Simple Syndication (RSS): allows users to receive the information they want, when they want without having to go through thousands of websites

o when changes are made, subscribers are informed of the new information

- Podcasts and Videocasts: digital files that is distributed over the Web using RSS for playback on portable media players and personal computers

Categories of Web 2.0 Sites (pg 159)

- Social networking: websites that allow users to upload their content in the form of text, voice, images

o Provides an easy, interactive way to communicate and collaborate w/ others

o i.e. MySpace, Youtube, Flickr, LinkedIn, Twitter

- Aggregators: websites that provide collections of content from the web

o i.e. Bloglines, Digg, simply hired

- Mashups: a website that takes different content from a number of other websites and mixes them together to create a new kind of content )i.e. Google Maps

E-Learning and Distance Learning (pg 162)

- E-Learning: refers to learning supported by the Web, can be used as a support tool inside a classroom or as a virtual classroom

- Distance Learning (DL): refers to learn any learning situation in which teacher and students do not meet face-to-face

The Benefits and Drawbacks of E-Learning

- Benefit: 1) current and up-to-date content, 2) gives students the flexibility to learn anytime, anywhere, 3) reduces training costs in organizations because facilities are not needed

- Disadvantage: 1) Students must be computer literate, 2) miss face-to-face interaction, 3) assessing student’s work can be difficult since teachers are unsure who completed assignment

- Virtual Universities: on-line but offsite university courses that students can take courses from

Telecommuting

- Knowledge workers (distributed workforce) that are able to work anytime from anywhere

- Distributed workforce is being driven by globalization, extremely long commutes to work, rising gas prices, and technological advances

- Advantages for employees: 1) reduced stress, improved family life, 2) allows employment opportunities for single parents and persons with disabilities

- Advantages for employer: 1) allowed skilled workers to be obtained, 2) increased productivity, 3) attract employees who don’t live within commuting distance

- Disadvantages for employees: 1) feeling of isolation, 2) loss of fridge benefits, 3) lower pay (sometimes), 4) possibly slower promotions, 5) lack of socialization

- Disadvantage for employer: 1) difficulties in supervising work, 2)security risks, 3) training costs

Chapter 6 (pg 174)

E-Commerce: process of buying, selling, transferring or exchanging products, services, information via a computer network

E-Business: incorporates everything E-Commerce in addition to servicing customers, collaborating with business partners and performing electronic transactions within an organization (term is interchangeable with e-commerce)

- The product can be physical or digital

- The process can be physical or digital

- Delivery agent can be physical or digital

Bricks-and-mortar organizations: purely physical organizations

Virtual organizations (pure-play): business that only conduct all business digitally

Clicks-and-mortar organizations (partial EC): conduct some e-commerce activity but mostly conduct physical business (i.e. Wal-Mart, buy a book from Amazon – book/delivery is physical)

Types of E-Commerce

Business-to-consumer (B2C): sellers are organizations, buyers are individuals

Business-to-Business (B2B): sellers and buyers are business organizations – majority of EC volume

Consumer-to-consumer (C2C): individuals sell/buy products off of other individuals (i.e. EBay)

- Ability to reach a wider audience on the internet rather than just a local audience

Business-to-employee (B2E): organizations provide information/services to employees – managing benefits, take training classes online, buy discount insurance, buy tickets using corporate discount, etc

E-government: ability of government to deliver information/public service announcements to citizens and allows governments to interact with citizens more directly (EI or Pension Plan payments to bank accounts online)

Mobile Commerce: using a wireless device to conduct e-commerce

Business model: methods which a company generates revenue to sustain themselves

- Online Direct Marketing, Name-your-own price, Viral marketing, product customization, deep discounters, memberships

Major E-Commerce Mechanisms

- E-catalogues, e-auctions, e-storefronts, e-malls and e-marketplaces

- Auction: seller solicits bids or a buyer solicits bids from sellers

o Forward auctions: sellers place an item on a site and buyers bid (Ebay)

o Reverse auctions: a buyer will post a request that it wants to buy a product or

service, suppliers then send their bids, and the lowest-price wins auction – typically used for large purchases (wholesale) and used mostly by governments and large organizations

- Electronic storefront: a single store Electronic Mall: collection of stores

- Electronic marketplace: virtual market space where buyers + sellers conduct e-commerce

Advantages of E-Commerce

- Ability to access national/international markets more accessible by lowering cost of processing, distributing, etc

- Customers are able to access a large number of products/services any time online

- Ability to deliver information quickly and to a large number of consumers

Limitations

- Lack of universally accepted security standards

- Expensive accessibility

- Belief that EC is insecure

- Lack of critical mass of sellers and buyers

Business-to-Consumer E-Commerce (pg 179)

- Amazon

- Electronic retailing (e-tailing): direct sale of products and services through electronic storefronts or electronic malls – offers wider variety of products and low prices

- Electronic storefront: can be physical stores with online websites or strictly an online store

- Electronic malls

Online Services Industries

- buying plane tickets, purchasing stocks, insurance, online delivery

o Disintermediation: eliminating the “middle man” from business transactions

- Cyber Banking – help deal with multiple currencies, cheaper for banks, convenient for customer

- Online securities trading – trade stocks, bonds – cheaper than a broker

- Online Job market

- Travel Services – cheap, up-to-date information

Issues In E-Tailing

Channel conflict – different distributors compete for same customers (click-and-mortar companies)

- Multi-channeling: process of integrating online and offline channels in a company

Order fulfillment – shipping and dealing with a large number of customers can be difficult

Online Advertising

- Disseminating information in an attempt to influence a buyer/seller transaction

- Can be updated anytime, low costs

- Reaches a larger volume of people

Advertising Methods

- Banners: electronic billboards, most commonly used form of advertising

o Advantage; banners can be customized to match a specific audience

o Disadvantages; limited information due to small size, easily ignored

- Pop-Up/Pop-Under Ads: pop-ups appear upfront, pop-under are under an active window

- E-mail Spamming: distribution of ads without permission of the receiver

- Permission Marketing: asking receiver permission to receive ads and e-mails, usually offered incentives (discounts)

- Viral Marketing: forwarding messages or ads to contacts

Business-to-Business (B2B) Electronic Commerce (p 186)

1) Sell-Side Marketplace: organizations attempt to sell their products/services to other organizations for their own private e-marketplace website

o Dell computers (dellauctions)

2) Buy-Side Marketplaces: organizations buy needed products or services from other organizations

o Reverse auctions

o Reduces costs of items purchased and administrative expenses

3) Electronic Exchanges: private exchanges = one buyer and many sellers, public exchanges = many sellers/many buyers

o Vertical Exchanges: connect sellers and buyers in a certain industry

o Horizontal Exchanges: connect buyers and sellers across many industries

o Functional exchanges: temporary help or extra office spaced traded on an as-

need basis

Electronic Payments (pg 189)

Electronic Cheques (E-Cheques): similar to regular cheques, they carry signatures (in digital form), can be verified and can be endorsed

- Typical used for Business-to-business - A customer who wishes to use an e-cheque must establish a chequing account w/ a

bank- Once the e-cheque is received by the seller, the seller deposits the cheque into their

bank account and the funds are then transferred from the buyer’s account to the seller’s account

Electronic Credit and Debit Cards: allows customers to charge online purchases to their credit card accounts, typical used for business-to-consumer transactions

- firstly, when using a credit card for online transactions, you must enter all your credit card information

- once the information is sent, the information is then sent to a clearinghouse where the information is decrypted for verification and authorization

- the clearinghouse then verifies with the credit card holder’s bank

- once verified, the clearinghouse reports back to the seller and the seller will usually relay the information of the successful transaction to the customer

- finally, the bank will then send funds sent by the seller to the company’s bank

Purchasing Cards: electronic credit cards used by B2B transactions (payments are settled in a week)

- Used for unplanned B2B purchases

Electronic Cash: appears in the forms of; stored-value money cards, smart cards, person-to-person payments and digital wallets

- stored-value money cards: cards that have a pre-determined amount and the amount decreases by the amount a person spends using the card, i.e. pre-paid telephone cards, York U Card

- Smart cards: smart cards possess a chip and can be used as a multi-purpose card (can be used as a credit, debit, stored-value money card), ideal for small payments of a few dollars or less, i.e. Presto transportation cards that can be used for public transit

- person-to-person: allows two individuals or an individual and a business to transfer funds without using a credit card (i.e. PayPal)

- Digital Wallets: stores financial information of the buyer (credit card number, shipping information, etc) this makes it convenient for the buyer as they do not have to enter it every single time

- disadvantage of e-wallets; must set up a separate e-wallet with each merchant (MasterCard Wallet)

Ethical and Legal Issues in E-Business

Ethical Issues

- Privacy: payment systems typical protect buyer’s personal information

- Tracking: cookies on the internet can help a business target consumers

- Job Loss: less physical staff is needed due to increase of online activity

Legal Issues

- Dishonest buyers/sellers can commit fraud

- Manipulating stock prices

- Fraud on the internet

o Stock promoters spreading false rumours about a company to manipulate stock

prices

o Auctions – selling fake items, never selling item, never paying for an item

- Domain Names

o Companies who share similar names often compete over domain names

o Cybersquatting: registering/using a domain name that belongs to someone else

and profiting off of the trademark

o Domain Tasting: claiming internet domains for 5 days and spamming them with

ads – 100% profit margin, no risk

- Taxes and Other Fees

o Collection and issuing of tax

- Copyright

o Protecting/distribution of intellectual properties

Chapter 7

Wireless Technologies

Reasons to use wireless technology:

- Able to have a productive use of time with wireless technologies

- Work locations are becoming more flexible

- Wireless technology enables people to allocate their working time around personal/professional

Wireless Application Protocol (WAP): standard that allows wireless devices to access web-based information and services

- Microbrowsers: internet browsers with small file sizes so they can work on small screen sizes

- Cell phones are being used to copy and pass on confidential information

Wireless Transmission Media

Microwave transmission: used for high volume, long distance, line of sight communication – communication where transmitter and receiver are in view of each other, usually 50km or less apart

- Advantages: high bandwidth, Inexpensive

- Disadvantages: must have unobstructed line of sight, susceptible to environment interference

Satellite Transmission: 3 types of satellites; 1) GEO (geostationary), MEO (medium earth orbit), LEO (low earth orbit)

- Advantages: high bandwidth, large coverage area

- Disadvantages: expensive, unobstructed line of sight, uses encryption for security, signals can be delayed

- GPS (global positioning system): uses satellites to determine where a user is on earth

- Internet over Satellite (IOS): used by areas where installing necessary cables is expensive or impossible

Radio Transmissions: uses radio-wave frequencies to send data directly between transmitters and receivers

- Advantages: high bandwidth, signals pass through walls, inexpensive + easy to install

- Disadvantages: electrical interference problems may occur, easy to infiltrate must be encrypted

Infrared: used in remote controls, VCRs, DVD players

- Advantages: low to medium bandwidth, used for short distances

- Disadvantages: must have unobstructed line of sight

Wireless computer Networks and Internet Access (pg 215)

Short Range Wireless Networks

- Bluetooth: used to create small personal area networks (computer network to communicate with other computer networks)

- Ultra-wideband (UWB): high-bandwidth wireless technology used to stream media

- NFC (near-field communication): short range, used in cell phones and credit cards and used at a point-of-sale terminal to pay for items

Medium Range Wireless Networks

- Wi-Fi (wireless fidelity): wireless Local Area Network (WLAN), wireless access point within a small area (60 meters)

o Low cost

o Disadvantages; roaming (users have to log-on to separate hotspots), security,

cost to expand

- Mesh networks: multiple Wi-Fi access points to create a wide area network

Wide Area Wireless Networks

- Cellular radio: radio waves that communicates with radio antennas

o Radio antennas are placed within adjacent geographic areas and a telephone

message is transmitted to the local cell then passed cell-to-cell until it reaches its destination

o 1G – used analog signals, low bandwidth, 2G – signals used for voice

communication, 3G – transmits voice and data (supports web browsing, IM)

Mobile Computing and Mobile Commerce (p 220)

- Mobility: users can carry devices and communicate in real-time with contacts from wherever

- Broad reach: users carrying a mobile device can be reached instantly

Development of M-Commerce

1) Widespread availability of mobile devices

2) No need for a PC – cheaper internet access

3) Cell phone culture – everyone has a cell phone

4) Declining prices – cell phones + plans are becoming more affordable

5) Bandwidth improvements

M-Commerce Applications

- Financial Services: mobile banking, wireless electronic payment systems, micropayments, wireless bill payments, m-wallets

- Intrabusiness Applications: non-voice mobile services to assist in dispatch, assign jobs

- Accessing information: mobile portals, voice portals

- Location Based Applications: shopping from wireless devices, GPS

- Wireless Telemedicine: sharing images/video, using robots to perform procedures

- Telemetry Applications: wireless transmission and receipt of data gathered from remote sensors (i.e. OnStar)

Pervasive Computing (p 226)

RFID (radio-frequency identification technology): tags w/ antennas and computer chips on goods used to track movement of packages through radio signals, used to replace bar codes

- Contains information about the item such as location, where and when it was made, etc

- Active tags; use internal batteries for power and broadcast radio waves to a reader – used for more expensive items

- Passive tags; rely on the reader for power, only can be used by to 6 meters

- UPC codes; 1) use line of sight – must be interference free to work, 2) label can be ripped off, 3) the bar code only identifies manufacturer and product but not the item itself

- RuBee is an alternative to RFID because it uses magnetic rather than electric energy

Wireless Sensor Networks (WSNs): networks of interconnected, battery-powered, wireless sensors, placed in a physical environment

- Motes contains processing, storage and radio-frequency sensors and antennas, when a mote passes through a data point it transmit and relays the data

- ZigBee – used to read meters for utilities by employees driving pass a house

Wireless Security (p 229)

- Can be intercepted by anyone who is close enough and has the right equipment

- 1) Rogue access point: unauthorized access point to a wireless network

- 2) evil twin attack: users connect to a fake access point that can lead to webpages asking for confidential information

- 3) War driving: locating WLANs around a city, accessing these WLANs for free

- 4) Eavesdropping: unauthorized users access data travelling over a wireless network

- 5) Radio-frequency jamming: person intentionally/unintentionally interferes with a wireless connection

Chapter 8 – Organizational Information Systems

Transaction Processing Systems (p 240)

Transaction: any business event that generates data worthy of being captured and stored in a database (i.e. product manufactured, service sold, person hired, payroll cheque generated)

Transaction Processing Systems (TPS): monitor, collect, store and process data generated from all business transactions

- Data are inputs to the organization’s database

- Inputs to functional area information systems, decision support systems, customer relationship management, knowledge management and e-commerce

- Handle high volume and large variations in volumes

- Must avoid errors and downtime, record results accurately and securely, maintain privacy and security

- Data from TPS are input into the organization’s database and must be correct

Steps of TPS:

- 1) Data is collected by people/sensors and entered into the computer via an input device

o Data automation: automating the TPS data entry process due to the high volume

involved

- 2) processes data through; a) batch processing, b) online processing

o Batch processing: firm collects data from transactions as they occur placing them

in groups or batches, then processes the batches periodically (i.e. every night)

o Real-time transaction processing (on-line TPS): business transactions are

processed online as soon as they occur (i.e. purchasing an item, system records the sales by reducing inventory on hand)

Functional Area Information Systems (p 242)

Functional Area Information Systems (FAIS): provide information to lower/middle level managers in various functional areas, helps plan/organize/control operations

- I.E. accounting, finance, marketing, production/operations, HRM

Activities supported by Functional Area Information Systems

Information Systems for Accounting and Finance

- Financial Planning: knowledge of availability and cost of money, cash flow projections

- Budgeting: planning on distributing resources that best supports organization’s missions and goals

- Investment Management

o Organizations invest in shares, bonds, real estate, managers must evaluate

financial and economic reports

o To monitor, interpret and analyze the huge amounts of online data, financial

analyst use; 1) internet search engines, 2) business intelligence/decision support software

- Control and Auditing

o Budgeting Control: managers must monitor departmental expenditures and

compare them against the budget

o Internal auditing

o Financial ratio analysis: liquidity ratio (availability of cash vs debt), activity ratio

(how quickly a firm converts non-cash assets to cash assets), debt ratios (firm’s ability to repay long-term debt)

o Virtual close – ability to close books at any time

- Payroll

Information Systems for Marketing and Sales

- Organization must understand customers’ needs and wants and develop a marketing strategy around them

- Treat customers like royalty, know customer profiles and preferences

- Sales force automation – use software to automate business tasks of sales, improving productivity of sales peoples

Production/Operations and Logistics

- Inventory management – how much inventory to order, inventory to keep and when to order to inventory

- Quality control – checking for defects in incoming goods and goods produced

- Materials requirements planning – planning that integrates production + purchasing and inventory management of interdependent items

- Manufacturing Resource Planning – planning that integrates production + inventory management, purchasing, financing and labour activities

- JIT systems – materials and parts arrive precisely when and where needed for production

- Product life cycle management – allows manufacturers to collaborate on product design and development efforts

Human Resource Management

- Recruitment – finding/testing/deciding which employees to hire

- Performance evaluation – evaluations done by superiors periodically

- Training

- Employee records

- Benefit administration – medical, retirement, disability, unemployment

Functional Area Information System Reports (247)

Routine reports: scheduled interval reports that can range from hourly quality control reports to daily attendance

Ad-hoc (on demand) reports: reports that are non-routine and require specific information

Drill down reports: great level of details (focuses more on sales by store in a region, rather than region as a whole)

Key-indicator reports: summarizes performance of critical activities

Comparative reports: reports that compare divisions, business units, etc

Exception Reports: reports that fall outside certain threshold standards – helps save time and focus on problem areas

Enterprise Resource Planning Systems (pg 250)

ERP systems: a business process view of the organization to integrate the planning, management and use of all of an organization’s resources, employing a common software platform and database

- Objective of ERP systems is to tightly integrate the functional areas of the organization and to enable information to flow seamlessly across the functional areas

- Changes in one functional area are immediately reflected in all other pertinent functional areas

- Provide information necessary to controls business processes of the organization

- i.e. SAP/Oracle/PeopleSoft

Evolution of ERP

- originally used to monitor manufacturing business processes (raw materials management, inventory control, distribution) but did not include functional areas such as sales and marketing

ERP II Systems: inter-organizational ERP systems that provide web-enabled links between a company’s key business systems (inventory and production) and its customers, suppliers, distributors, etc

Advantages of ERP Systems

- Organizational flexibility and agility: ERP systems break down departmental/functional silos of business processes, information systems and information resources which allows quicker access during changing business conditions and the ability to capitalize new business opportunities

- Decision Support: ERP provides information on business performance across all functional areas, helps managers make better/quicker decisions

- Quality and efficiency: ERP systems integrate and improve an organizations business processes, quality and efficiency in customer service, production, distribution increases

- Decreased costs: reduce transaction/hardware/software costs

Disadvantages of ERP Systems

- Businesses might have to change their best practices (successful solutions or problem solving methods for achieving a business objective), to fit the predefined business processes of the software

- Extremely complex

- Expensive

- Time-consuming

- Changing previous data to ERP systems can result in loss of data

- ERP implementation fails because; 1) employees are not involved in planning + development phases, 2) changes occur too quickly, 3) insufficient training, 4) failure to perform proper data conversion

Enterprise Application Integration: system that integrates existing systems by providing layers of software that connects applications together

Chapter 9 – ADMS 2511

Customer Relationship Management: A customer focused and customer-driven organizational strategy that concentrates on satisfying customers by addressing their requirements for products and services and then by providing high-quality, responsive service

- Defining customer relationship management: customer touch points, data consolidation

- Operational CRM: customer-facing applications, customer-touching applications

- Analytical CRM: electronic data interchange (EDI), Web Services, Extranets

- On-Demand CRM, Mobile CRM, Open Source CRM

- CRM helps acquire new customers, retain existing profitable customers and grow the relationships with existing customers

- Treat customers differently because their needs differ and their value to the company may also differ

Customer Touch Points: an interaction between an organization and customers

- Telephone contact, direct mailing, physical interaction during store visits

- E-Mail, Websites, smartphone communication, call centers

Data Consolidation:

- 360-degree view – data about the customer

- Collaborative CRM: effective and efficient communication with the customer throughout the entire organization, providing customer support in functional areas such as; marketing, sales, etc

Operational CRM: supports front-office business processes, processes that directly interact with customers; sales, marketing and service

- Customer-Facing Applications: applications where an organization’s sales, field service and customer interaction centre representatives actually interact w/ customers – (i.e. customer support, sales force automation, marketing and campaign management)

- Customer Service and Support: systems that automate service requests, complaints, product returns and request for information

o Customer interaction centres (CIC): organization representatives use multiple

communication channels such as; web, phone, fax, etc to support communication preferences of customers

Outbound telesales: discussion between customer and sales team about products serving needs

Inbound telesales: customers inquire about products, ask questions about placed orders or make a purchase

• live chat advantage over phone because photos/documents are

shared

o Amazon Fulfillment: Amazon receives shipments of products from merchants and

uses order fulfillment system such as; taking online orders, packages the merchandise, communicates with customers and handles any product returns

- Sales Force Automation: component of operational CRM that automatically records all aspects in a sales transaction process

o contact management system: tracks on contact that has been made with a

customer, purpose of the contact and necessary follow-up, helps eliminates redundancy and duplicate contacts

o sales lead tracking system: lists potential customers, customers who have

purchased related goods

o sales forecasting system: mathematical technique on forecasting future sales

o product knowledge system: sources of information regarding products and

services

o configurators (online product building): enable customers to make products

based on their needs (NikeID)

- Marketing: CRM allows marketers to identify and target their best customers, manage marketing campaigns and generate quality leads for sales teams, assists with data mining – going through customer data, developing purchase profiles – customer buying habits

o Cross-selling: marketing additional related products based on previous

purchases

o Up-selling: sales strategy where businesses gift customers the opportunity to

purchase higher-value products opposed to or related or along with customer’s initial purchase (i.e. showing a customer a HD TV beside Standard Def, hoping customer buys HD set, or pushing the purchase of a carwash after buying gas)

o Bundling: form of cross-selling that groups together a group of products and

selling for a lower combined individual costs

- Campaign Management: organizations plan campaigns so the right message is sent to the right people through the right channels

- Customer Touching Applications: applications and technologies which customers interact and typically help themselves

o Search and Comparison Capabilities

o Technical and Other Information and Services – providing information/manuals

online

o Customized Products and Services - NikeID

o Personalized Web Pages – allows customers to record

purchases/preferences/problems

o FAQs – answers repetitive customer questions

o E-Mail and Automated Reponses – send out newsletters, etc

o Loyalty Programs – rewards for frequent customers

Benefits of Operational CRM (pg 273)

- Efficient, personalized marketing, sales, and services

- 360-degree view of each customer

- Ability of sales/service employees to access a complete history of customer interaction

- Assists with improving sales/account management by optimizing information shared by multiple employees

- Forms individual relationships w/ customers, provides customer satisfaction, max profits

- Identifies most profitable customers and provides them with highest level of service

- Provides employees with information and processes necessary to know customers

- Understands and identifies customer needs and helps build relationship among company

Analytical CRM: customer relationship management systems that analyze customer behaviour and perceptions in order to provide actionable business intelligence

- Analyze customer behaviour and perceptions in order to provide information on customer requests and transactions, as well as on customer responses to an organization’s marketing, sales and service initiatives

- Important technologies associated with Analytical CRM; data warehouses, data mining, decision support and other business intelligence technologies

- Information is delivered to an organization in the form of reports and digital dashboards

Analytical CRM analyzes customer data for a variety of purposes including;

- designing and executing targeted marketing campaigns

- increasing customer acquisition, cross-selling/up-selling,

- providing input into decisions related to products and services (prices/product development),

- providing financial forecasting and customer profitability analysis

Other Types of CRM (p 275)

On-Demand CRM: CRM system that is hosted by an external vendor in the vendor’s data centre

- avoids cost of purchasing the system

- organization’s employees need to know only how to access and use it (utility computing)

- disadvantages; vendor can be unreliable, difficult/impossible to modify and vendor is the only one who can upgrade, may be difficult to integrate vendor-hosted CRM software with organization’s existing software, giving strategic customer data to vendors can be risky

Mobile CRM: enables an organization to conduct communications related to sales, marketing and customer service activities through a mobile medium for the purpose of building and maintain a relationship with customers

Open-Source CRM: CRM software that is available to developers and users

- benefits; favourable pricing, wide variety of applications, customizable, attractive features, updates and bug fixes occur rapidly, extensive support information is available free of charge

- disadvantages; quality control – lack of central authority overseeing quality of CRM

Chapter 10 – Supply Chain Management

• 10.1 The Structure of Supply Chains

o Supply chain – refers to the low of materials, information, money, and services form raw

material suppliers through factories and warehouses, to the end customers

Also includes the organizations and processes that create and deliver products, information and services to end customers

Supply chain involves three segments: upstream, internal, downstream

• Upstream – sourcing or procurement from external suppliers occurs, supply chain

managers select suppliers to deliver the goods and services the company needs to produce its product or service

• Internal – packaging, assembly or manufacturing takes place. SC managers schedule

the activities necessary for production, testing, packaging

• Downstream – where distribution takes place frequently by external distributors. SC

managers coordinate the receipt of orders from customers, develop a network of warehouses, select carriers to deliver products

Three flows in the supply chain: materials, information, and financial

• Material flows – physical products, raw materials, supplies

o Also include reverse flows (reverse logistics) – returned products

• Information flows – consist of data that are related to demand, shipments, orders,

returns and schedules

• Financial flows – involve money transfers, payments, credit card information

• In service industries there may be no physical flow of materials, but a flow of

information often in the form of documents(physical or electronic copies)

o Purpose of supply chain concept is to improve trust and collaboration among supply chain

partners, thus improving supply chain visibility and inventory velocity

Supply chain visibility – ability for all organizations in a supply chain to access or view relvant data on purchased materials or access or view relevant data on outbound goods as they are manufactured, assembled or stored

Inventory velocity – time between the recipient of incoming goods and the dispatch of finished outbound products

• Greater your inventory velocity them ore quickly you can deliver your products

• 10.2 Problems along the Supply Chain and their Solutions

o Problems along the supply chain stem primarily from two sources: 1) uncertainties and 2) the

need to coordinate several activities, internal units, and business partners

Major source of supply chain uncertainties is the demand forecast – demand for a product can be influenced by numerous factors such as competition, prices, weather conditions, technological developments, economic conditions and customers general confidence

Another uncertainty is delivery times - production failures to road construction

Challenges for setting accurate inventory levels – the bullwhip effect – refers to erratic shifts in orders up and down the supply chain

• The bullwhip effect is due to the use of the push production model in the supply

chain

o The push model – also known as make to stock

o Solutions to supply chain problems

Vertical integration – is a business strategy in which a company buys its upstream suppliers to ensure that its essential suppliers are available as soon as they are needed

Just-in-time inventory system – attempts to minimize inventories , manufacturing process, JIT systems deliver the precise number of parts, to be assembled into a finished product at precisely the right time

Another way is sharing information along the supply chain

• Information sharing enables a company to implement a pull model – also known as

make-to-order - the production process begins with a customer order, companies make what customers want

• 10.3 supply chain management systems and related technologies

o Supply chain management (SCM) – consists in planning, organizing and optimizing the

various activities performed along the supply chain

o An inter-organizational information systems (IOS) involves information flows among two or

more organizations

IOS perform and receive a number of benefits: reduce the costs of routine business transactions, improve the quality of the information flow, eliminate paper processing

Goal of SCM is to reduce the problem, or friction – friction can involve increased time, costs, and inventories

o Electronic data interchange (EDI) – is a communication standard that enables business

partners to exchange routine documents such as purchasing orders – it then transmits messages that travel over a value-added network or the internet

EDI provides many benefits: minimizes data entry errors, length of the message an be shorter, messages are secured, reduces cycle time, increases productivity

Several factors preventing it: involves significant initial investment, operating costs are high, traditional EDI is inflexible, requires long startup period

o Web services – applications, delivered over the Internet that users can select and combine

through almost any device from personal computers to mobile phones

Great potential because they can be used in a variety of environments

Perform a wide variety of tasks – automating business processes to integrating components of an enterprise-wide system to online buying and selling

Related to web services is service-oriented architecture (SQA) – IT architecture that makes it possible to construct business applications using web services

o Extranets – a company must connect the intranets of its various business partners to create

extranets

Extranets link business partners to one another over the Internet by providing accss to certain areas of one another’s corporate intranets

Primary goal of extranets is to foster collaboration between and among business partners

Major benefits: faster processes and information flow, improved customer service, lower costs

Types of extranets: a company and its dealers, customers or suppliers centered around a single company), An industry’s extranet, (whole industry), Joint ventures and other business partnerships (extranet used as vehicle, Bank of America for commercial loans)

Chapter 11 – ADMS 2511

Managers and Decision Making

Management: process which an organization achieves its goals through the use of resources (people, money, energy, materials, information, space, time), resources are inputs, achieving goals is outputs. Managers are measured by their ratio of inputs to outputs; the ratio is an organization’s productivity

Mintzberg’s managerial roles:

- Interpersonal: figurehead, leader, liaison

- Information: monitor, disseminator, spokesperson, analyzer

- Decisional: entrepreneur, disturbance handler, resource allocator, negotiator

Decision process consist of; intelligence, design and choice

- Intelligence: managers examine a situation and identify and define the problem

o Organizational objectives, search and scanning procedures, data collection,

problem identification/classification/statement

- Design: constructing a model that simplifies the problem, making assumptions that simplifies reality and expressing the relationships among all relevant variables

o Formulate a model (assumptions), set criteria for choice, search for alternatives,

predict and measure outcomes

- Choice: verifying and testing the solution

o Solution to the model, sensitivity analysis, selection of best alternative, plan for

implementation, design of a control system

Why Managers Need IT Support

1) Number of alternatives is increasing, therefore as more alternatives exist, decision makers need computer-assisted search and comparisons

2) Time-restraints; must process information fast

3) A sophistical analysis is necessary due to decisions being more complex

4) Necessary to access remote information, consult with experts, conduct a group decision-making session without incurring large expenses

Problem Structure

- Structured decisions – routine and repetitive problems for which standard solutions exist (inventory control)

- Structured problem – use three phases of decision process to create a procedure and use the criteria of 1) minimizing cost 2) maximizing profits, to evaluate proposed solutions

- Unstructured problem – intelligence, design and choice are not in an organized order, typically involved in; planning new services, hiring an executive and choosing R&D projects

- Semi structured problems – combination of standard solution procedures and individual judgment (evaluating employees, setting budgets, performing capital acquisition, trading bonds)

The Nature of Decisions

1) Operational control – executing specific tasks effectively and efficiently

2) Management control – acquiring and using resources efficiently in accomplishing organizational goals

3) Strategic planning – long-range goals and polices for growth and resource allocation

Business Intelligence (pg 310)

- Refers to applications and technologies for consolidating, analyzing and providing access to vast amounts of data to help users make better business and strategic decisions

- Provide historical, current, predictive views of business operations

- Corporate performance management: monitoring and managing of an organization’s performance according to key performance indicators such as revenue, return on investment, overhead and operational costs

- Two types of business application programs; 1) those that provide data analysis tools (multi-dimensional data analysis, data mining, decision support systems 2) those that provide easily accessible information in a structured format (digital dashboards)

Multi-Dimensional Data Analysis (On-line Analytical Processing): process of performing complex, multi-dimensional analyses of data stored in a database or data warehouse, provides users with a view of what is happening or what has happened, helps access information quickly

Data Mining: process of searching for valuable business information in a large database, data ware house, or data mart with the intent of identifying a business opportunity in order to create a sustainable competitive advantage

- Predicts trends and behaviours

- Identifies previously unknown patterns

- Retailing and Sales; predicts sales, prevent theft/fraud, correct inventory levels

- Banking; forecasting bad loans, fraudulent credit card use, predicting credit card spending by customers

- Manufacturing and production; predicting machinery failures

- Insurance; forecasting claim/medical amounts, predicting which customers will by policies

- Health Care; correlating patient demographics with illnesses

- Marketing; classifying customer demographics, predicting who will respond to mail

Decision Support Systems: combine models and data in an attempt to solve semi-structured and some unstructured problems, manipulates data and conduct appropriate analyses

- Organizational decision support system: focuses on an organizational task or activity that involve a sequence of operations and decision makers (i.e. capital budgeting, developing divisional marketing plans)

- Sensitivity Analysis: the study of the impact that changes in one or more parts of model have on other parts

o Adapts to changing conditions

o Sensitive model: small changes in conditions dictate a different solution

o Non-sensitive: changes in conditions do not significantly change the

recommended solution

Changes for a solution to succeed are higher in a non-sensitive model

- What-If Analysis: attempts to predict impact of a change in the assumptions (input data) on proposed solution

- Goal-Seeking Analysis: starting from desired output and working backwards to find values of necessary input to achieve desired levels of output

- Digital Dashboards (executive dashboard/management cockpit): (315) provides rapid access to timely information and direct access to management reports, enables managers to examine exception reports and drill-down reports information and direct access to management reports, enables managers to examine exception reports and drill-down reports(i.e. Bloomberg report)

o Capabilities;

Drill-Down Reports – details at several levels

Critical success factor (CSF) – calculates factors critical for success

Key-performance indicator

Status access: latest data available on KPI

Trend Analysis

Ad-hoc analysis – analyses made any time upon demand

Exception report: reports that highlight deviations larger than certain thresholds

- The Management Cockpit: strategic management room containing elaborate sets of digital dashboards that enables top-level decision makers to pilot their businesses better

o 4 walls are designated; black – shows principal success factors and financial

indicators, red – market performance, blue – performance of internal processes/employees, white – status of strategic projects

Data Visualization Technologies (pg 317)

Geographic Information Systems (GIS): computer-based system for capturing, integrating, manipulating and displaying data using digitized maps, every record/digital object has an identified geographic location

Virtual Reality: interactive, computer-generated, 3D , developed to user through head-mounted display

- Use in Manufacturing; Training, Safety, Virtual prototypes, simulation of assembly, production

- Use in Medicine; training of surgeons, planning of surgeries, physical therapy

Intelligent Systems (320)

Intelligent System: term that describes various commercial applications of A.I.

Artificial Intelligence: subfield of computer science that is concerned w/ studying thought process of humans and recreating effects of those processes via machines, such as; computers and robots

- Signs of intelligence; learning/understanding from experience, making sense of ambiguous/contradictory messages, responding quickly/successfully to new situations

- Turing test: proposes a person and computer pretend to be human and the human interviewer has to decide which is which

Capabilities Natural Intelligence Artificial Intelligence

Preservation of Knowledge Perishable – org. point of view Permanent

Duplication and dissemination of knowledge

Difficult, expensive, takes time Easy, fast, inexpensive

Total cost of knowledge Erratic, inconsistent, incomplete at times

Consistent and thorough

Documentability of process and knowledge

Difficult/expensive Requires structured process and well-trained staff, can be costly

Creativity Can be high Low, uninspired

Use of Sensory experience Direct and rich in possibilities Must be interpreted first, limited

Recognition of patterns/relationships

Fast/easy to explain Can go either way

Reasoning Makes use of a wide context of experiences

Good only in narrow, focused and stable domains

Expert Systems: computer system that attempts to mimic human experts by applying expertise in a specific domain, can either support decision makers or completely replace them

- Interpretation, prediction, diagnosis, design, planning, monitoring, debugging, repair, instruction, control

- Advantages; increased output and productivity, increased quality – consistent advice/reduce error rates, reliable – always available (no strikes, sick, etc), decreased decision-making time

Natural Language Processing and Voice Technologies: communicating with computers in the user’s native language, allows a computer to analyze and interpret the input – includes knowledge about words, domain knowledge (air travel, student registration information), commonsense, etc

Natural Language understanding: (speech recognition) allows a computer to comprehend spoken instructions given in the user’s everyday language

- Advantages; easy to use, faster, manual freedom – does not require hands

- Disadvantages; disability to recognize long sentences, high cost for better systems

Natural Language Generation: (voice synthesis) enables computers to produce everyday languages either by “voice” or on a screen, computer talks back to user

- Interactive Voice Response (IVR): can be used in almost all applications, provide automated response to users, (i.e. employee inquiring about payroll)

Neural Networks: system of programs and data structures that simulates the underlying concepts of the human brain, large number of processors operating in parallel – each with small sphere of knowledge and access to data in its local memory , good at recognizing hidden, emerging patterns

- Used to combat fraud in credit card, health card and telecommunications industry

Fuzzy Logic: deals with uncertainties by simulating the process of human reasoning

Chapter 12 – ADMS 2511

Information Technology Project Management (pg 336)

Projects: short-term efforts to create specific business-related outcome (project/service)

IS Project Management: directed effort to plan, organize, and manage resources to bring about the successful achievement of specific Information System Goals

Triple Constraints of Project Management: time, cost, scope

- Time – window of opportunity in which a project must be completed to provide a benefit to the organization

- Cost – amount of resources (cash/labour) that an organization can commit to completing a project

- Scope – process that ensures that the project includes all the work required and only the work required – to complete the project successfully

- For an IS project to be successful, organization must allow an adequate amount of time, provide appropriate amount of resources and carefully define what is and is not included in the project

- Effective security is necessary to prevent unauthorized changes or access to program/data

The Project Management Process

- 1) Project Initiation: clearly define the problem the project is intended to solve and the goals that it is to achieve, identify and resources needed, analyze costs and benefits of the project, identify potential risks

- 2) Project Planning: every activity must be indentified and sequenced , PERT (program evaluation and review technique), CPM (critical path method), planning involves determining performance sequence and how long each activity will be

- 3) Project Execution: project’s plan is to be performed to accomplish project’s requirements

- 4) Project Monitoring and Control: 1) monitoring ongoing project activities, 2) comparing project variables, 3) identifying corrective actions

- 5) Project Completion: completed when formally accepted by organization, activities are finalized and contracts are fulfilled and settled

Project Management Failure

- Lack of sufficient planning at the start of a project

- Difficulties with technology capability (new technologies may not work with existing technologies)

- Lack of commitment by management to provide necessary resources

- Poorly defined project scope

- Lack of sufficient time to complete project

Evaluating and Justifying IT Investment: Benefits, Costs, Issues (pg 339)

Assessing the Costs

- Difficult to allocate fixed costs (infrastructure, cost of IT services, IT management)

- Costs for maintaining, debugging and improving system can accumulate over many years (Y2K reprogramming)

Assessing the Benefits

- Harder to assess compared to costs

- Many intangibles (improved customer or partner relations, improved decision making)

Conducting Cost-Benefit Analysis

1) Net present value (NPV): convert future values of benefits to their present-value equivalent by discounting them at the organization’s cost of funds. Compare present value of the future benefits to the cost required to achieve those benefits to determine whether the benefits exceed the costs

2) Return on investment (ROI): measures management’s effectiveness in generating profits with its available assets. Calculated by dividing net income attributable to project by the average assets invested in the project

3) Break-even analysis: determines the point which cumulative dollar value of the benefits from a project equals the investment made in the project, flawed – ignores value of system benefits

4) Business Case approach: system developers write a business case to justify funding one or more specific applications or project

Strategies for Acquiring IT Applications (340)

Buy the Applications (Off-The-Shelf)

- Buying existing software – can be cost-effective and time-saving strategy compared to developing software in-house

- Companies may buy multiple software packages to satisfying the multitude of needs

- Advantages; many types of software available, software can be tried out before purchase, time-saving – don’t have to develop, know what they’re getting before investing, software has been tested due to company not being first user, cost-effective – avoids hiring personnel dedicated to project

- Disadvantages; software may not meet company needs, software may be difficult/impossible to modify, company will not have control over software improvements and new versions, purchased software can be difficult to integrate with existing systems, vendor may go out of business, purchasing company may not know enough about the software

Lease the Applications

- Can save time and money, similar to buying application – saves more money by not having to buy application fully

- Might not fit with organization’s requirements

- Companies should use 80/20 rule, if vendor’s software fits 80% of needs, then should change business procedures to match the remaining 20%

- More attractive to small to medium companies

- Should be used by a company with a shortage of IT personnel

- Ways software can be leased; 1) install on company’s premises – vendor can help with installation and will offer to contract for support/maintenance of system, 2) application service provider, 3) software-as-a-service

- Application service provider: vendor assembles software needed by enterprise and packages the software w/ services such as development, operations and maintenance, accessed through internet

Use Software-as-a-Service

- Method of delivering software in which a vendor hosts the applications and provides them as a service to customers over a network (Internet), unnecessary to install and run applications on an individual computer

Use Open-Source Software: develop applications in-house, organizations obtain a licence to employ an open-source software product, can either use it, customize it, or develop applications

Outsource: acquiring IT applications from outside contractors or from external organizations

- Used to protect internal networks and gain access to outside networks

- Disadvantage; Company’s valuable corporate data may be under the control of the outsourcing

Vendor

Develop the Applications In-House

- Time-consuming, costly compared to buying/leasing

- Advantage; better fit for company

The Traditional Systems Development Life Cycle (pg 344): traditional systems development method organizations use for large-scale IT projects

- Involve; systems investigation, systems analysis, systems design, programming and testing, implementation, operations and maintenance

- Systems analyst: specialize in analyzing and designing information systems

- Programmers: professionals who modify or write new computer programs to fit user’s needs

- Technical Specialists: experts on a certain type of technology (database/telecommunications)

- Systems Investigation: developers must; a) understand business problem to be solved, b) specify technical options for systems and c) anticipate problems likely to occur

o Organization solutions to information systems: 1) do nothing and continue to use

existing system unchanged, 2) modify or enhance existing system, 3) develop new system

Based on technical, economic, behavioral feasibility

- Systems Analysis: examination of the business problem that the organization plans to solve with an information system

- Systems Design: describes how the system will resolve the business problem, deliverable of the systems design phase is the set of technical system specifications, include; 1) system outputs, inputs and user interfaces, 2) hardware, software, databases, 3) blueprint of how components are integrated

o Scope creep: addition of functions to an information system after the project has

begun

- Programming: translating design specifications into computer code, process can be lengthy and time-consuming

- Implementation (deployment): process of converting from old system to new system

o Direct conversion: old system is complete turned off and replaced with new

system, risky if new system does not work, therefore no backup with old system

o Pilot conversion: introduces new system in only one part of organization, if

assessment of system is positive, it is then introduced to rest of organization

o Phased conversion: introduces components of the new system in stages, if

each stages are working, more are introduced

o Parallel conversion: old and new system operate simultaneously, hardly used

today

- Operation and Maintenance: 1) debugging – process that continues for life of system, 2) updating – changing the system to accommodate changing business conditions, 3) adds new functions without disturbing existing system

- Advantages; 1) forces staff to go through every step in a structured process, 2) enforces quality by maintaining standards, 3) lower probability of missing important issues in collecting user requirements

- Disadvantages; 1) users may be unwilling to study the specifications they approve, 2) takes long – going from original ideas to a working system, 3) systems may be error prone/poorly tested

Alternative Methods and Tools for Systems Development

Prototyping: approach that defines an initial list of user requirements, builds a prototype system, and then improves the system in several iterations based on user’s feedback

- Prototype: can contain components of the new system that are the most interest to users or a small-scale working model of an entire system

o Prototypes are improved based on user feedback

- Advantages; 1) helps clarify user requirements/verify feasibility of the design, 2) promotes user participation, 3) promotes close working relationship between user and system developers, 4) works well will ill-defined problems

- Disadvantage; 1) users may not realize the prototype they are using is not the finished product and may not realize how much work the database, error checking, security precautions and other functions need, 2) users may still use prototype after finished product is complete, 3) not practical with large number of users, 4) system may be built quickly, resulting in lower quality

Job Application Design: group-based tool for collecting user requirements and creating system designs

- Meeting takes place where analyst and users of the system meet and agree on system requirements

- Advantages; 1) many users in development process, 2) saves time, 3) greater user support 4) quality of new system is improved, 5) new system easier to implement

- Disadvantages; 1) difficult to get all users to attend JAD meeting

Integrated Computer-Assisted Software Engineering Tools

- Computer-aided software engineering (CASE): development approach that uses specialized tools to automate many tasks in the SDLC

- Upper CASE tools (systems investigation, analysis and design), Lower case tools (programming, testing, implementation, operation, maintenance)

- Advantages; 1) can produce system w/ longer effective operational life, 2) produce system that closely meets user requirements, 3) speed up the development process

- Disadvantages; 1) expensive to build and maintain, 2) requires more extensive/accurate definition of user requirements, 3) difficult to customize

Rapid Application Development (RAD): systems development method that combine JAD, prototyping, and ICASE tools to rapidly produce high quality system

- Developers use JAD sessions to collect system requirements, users are intensely involved

- Development process is similar to prototyping, systems are developed then undergo series of improvements

- ICASE tools are used to quickly structure requirements/develop prototypes

- Advantages; 1) can speed up systems development, 2) users are intensively involved from start

- Disadvantage; produces functional components of final systems but not final system

Agile Development: software development methodology that delivers functionality in rapid iterations, usually weeks

- Requires rapid development and frequent user contact to address needs of business users

- Does not need to include every possible feature user require, only user’s most important/immediate needs

End-User Development: organization’s end users develop their own applications with little or no assistance from IT department

- Advantages; 1) bypasses IS department, avoids delays, 2) users control application, can change as needed, 3) meets users exact requirements, 4)frees up IT resources

- Disadvantages; 1) poor quality control, 2) may create lower quality systems, 3) users do not document their work enough, 4) may fail to take proper security measures

Object-Oriented Development: system development methodology that begins w/ aspects of real world modeled to perform a task (i.e. a billing system can only handle bills but it uses the same info for marketing/sales – names, addresses, but can’t be used by these functions, Object-Oriented makes it one universal system)

- Advantages; 1)object models real-world entities, 2) may be able to reuse some computer code

- Disadvantages; 1) works best w/ systems with a limited scope – systems that do not have huge numbers of objects

Vendor and Software Selection* ( pg 353)

Step 1: Identify Potential Vendors – using software catalogues, technical and trade journals, consultants and industry analysts experienced in the application area, peers in other companies, web searches

Step 2: Determine the Evaluation Criteria

- Characteristics of the vendor, functional requirements of the system needed, technical requirements that the software must satisfy, amount and quality of documentation provided, vendor support of the package

- Request for proposal (RFP) document: sent to potential vendors outlining criteria and inviting them to submit a proposal that describes the vendor’s software package and how it will meet company needs

Step 3: Evaluate Vendors and Packages

- Companies determine vendors and packages by reviewing how each company fit needed criteria

Step 4: Choose Vendor and Package – company must consider opinions of both users and IT personnel

Step 5: Negotiate a Contract – determines price of software and amount of support the vendor will agree to provide, must have specifications (requirements) needed by the company

Step 6: Establish a Service Level Agreement

SLA: formal agreements that specify how work is to be divided between company and vendors

- Defines the responsibilities of both partners

- Provides framework for designing support services

- Allowing company to retain as much control as possible over own systems

Technology Guide 1

Introducing Hardware Components (pg 365)

CPU (central processing unit): manipulates the data and controls the tasks performed by the other components, performs “number crunching” inside a computer

Primary Storage: temporary stores data and program instructions during processing

Secondary Storage: External to the CPU; stores data and programs for future use

Input technologies: accept data and instructions and converts them to a format the computer understands

Output technologies: present data and information in a form people can understand

Communication technologies: provide for the flow of data from external computer networks (Internet) to the CPU and from the CPU to the computer networks

Innovations In Hardware Utilization

Server Farms: data centres that contain hundreds of thousands of networked computer servers

- Provides redundancy and fault tolerance in case one server fails

- Costly; requires security, electric power, A/C, backup generators

Server Virtualization: using software based platforms to create multiple virtual servers on a single physical server – allows for multiple applications to run on a single physical server

- Less physical servers = lower cost/more space

- Allows an organization to modify a system quickly if necessary

Grid Computing: process that applies the unused processing recourses of many geographically dispersed computers in a network to form a virtual supercomputer

Utility Computing: type of computing where a service provide makes computing resources available to a customer as needed – provider charges per usage rather than flat rate

- Provides redundancy, fault tolerance, scalability – servers can be easily added if needed

Cloud Computing: tasks are performed by computers physically removed from the user and accessed over a network

- “cloud” is composed of the computers, software on the computers and network connections among the computers

- Combines grid + utility computing

- Advantage: lower infrastructure costs, disadvantage: privacy, security and reliability

Edge Computing: process which parts of website content and processing are located close to the user to decrease response time and lower processing costs

Autonomic Computing: computers design to manage themselves with humans

Nanotechnology: creation of materials, devices, systems in a small scale

The Computer Hierarchy (371)

Supercomputers: fastest computer engine available at any given time – used for very large data and military, banks, health organizations and scientific purposes

Mainframe Computers: large computers used in large organizations that run extensive computer applications and are able to be accessed by thousands of users (applications include; payroll programs, student grade calculations, reservation systems)

- Able to support the high amount of transactions associated with e-commerce, reduces total cost of ownership of distributed systems, simplifies administration, improves system performance

Midrange Computers (minicomputers): small, inexpensive, compact computers that perform the same functions as mainframe computers – type of server because it supports networks and enables users to share files, software and other resources

Workstations: run scientific, engineering and financial applications – typical used by business and science communities

Microcomputers (PCs) – smallest and least expensive

- Desktop PCs

- Thin-client systems – desktop computers that do not offer full functionality of a PC

- Laptops

- Netbooks

Computer Memory and Storage Systems (pg 379)

Primary Storage: stores three types of information for a brief period of time; 1) data to be processed by the CPU, 2) instructions for the CPU on how to process data, 3) operating system programs that manage various aspects of the computer’s operations

- RAM (Random access memory): part of primary storage that holds a software program and small amounts of data for processing

- Cache memory: allows the computer to temporarily store blocks of data that are used more often and that a processor can access more rapidly than main memory (RAM)

- Read-Only memory (ROM): chip where critical instructions are safeguarded (information for the computer to start up or “boot”, can’t be changed by a user)

Secondary Storage: stores large amounts of data for extended periods of time

- External, Nonvolatile, cheaper than primary storage, takes longer to access

- Hard drive: storage on a magnetized disk that is divided into tracks and sectors that provide addresses for various pieces of data

Enterprise Storage Systems: independent, external system that includes two or more storage devices (flash drives)

Redundant arrays of independent disks (RAID): enterprise storage system that links groups of standard hard drives to a specialized microcontroller that coordinates the drives so they appear as a single logical drive

Storage Area Networks (SAN): architecture for building special, dedicated networks that allow rapid and reliable access to storage devices by multiple servers

Network Attached Storage (NAS): device is a special purpose server that provides file storage to users who access the device over a network (plug-and-play)

Technology Guide 2

Software: set of programs that allows hardware to process data

- Consists of computer programs – instructions for the computer

- Stored program concept: software programs are stored in the computer’s hardware

- Documentation – written description of the functions of the program

Systems Software: set of instructions that serves primarily as an intermediary between computer hardware and application programs (self-regulatory functions of the computer – loading itself)

Application Software: class of computer instructions that direct a computer system to perform specific processing activities and provide functionality for users (word processing)

Systems Software

System control programs: controls the use of the hardware, software and data resources of a computer system – main system control program is the operating systems

- Operating System – supervises overall operations of a computer, monitors computer’s status and scheduling operations, including input and output processes

Functions of the Operating System

- manages the programs running on the processor at any given time

- Multi-tasking: process of a computer running two or more tasks (programs) at the same time

- Multi-threading: multiple tasks are running in the same application (Word performing spell check as it types)

- Multiprocessing: two or more processors run more than one program at a given time by assigning them to different processors

- Virtual memory: simulates more main memory than actually exists in the computer system

- Graphical User Interface (GUI): allows users to exercise direct control of visible objections (icons) and actions that replace complex commands

- Social interface: user interface that guides the user through computer applications by using cartoon-like characters, graphics, animation and voice commands

- Haptic interface: allows users to feel a sense of touch by applying forces, vibrations and motions to the user (Wii, iPhone)

- Spatial operating environment: allows a user to stand/sit in front of a computer screen, wearing gloved hands and gesturing to move images around, touch objects, etc

Plug-and-play: automate installation of new hardware and installing the necessary software

System support programs: support the operations, management and users of a computer system by providing a variety of support services (utility programs, performance monitors, security monitors)

System utilities: programs that been written to accomplish common tasks such as sorting records/creating directories and subdirectories (programs restore accidently erased files, locate files, manage memory usage)

System performance monitors: programs that monitor processing of jobs on a computer system (monitor processor time, memory space, input/output devices)

System security monitors: programs that monitor the use of a computer system to protect it and its resources from unauthorized use, fraud and destruction

Application Software

Proprietary application software: addresses specific or unique business need for a company

- Contract software: software programs developed by a particular company by a vendor

Off-the-shelf application software: software programs that can be purchased, leased, rented from a vendor, can be tailored for a specific purpose (inventory control, payroll)

Personal application software: general purpose, off-the-shelf applications designed to help individual users increase their productivity (word processing, spreadsheets, personal finance)

Open System: model of computing products that work together by use of the same operating system with compatible software on all the different computers that would interact with one another in an organization

Programming Languages

Compiler: type of systems software that converts other computer languages into machine language

Object-oriented languages: taking a small amount of data and instructions about what to do with that data, which are called methods, and combining them into an object

Java: object-oriented programming language, that gives programmers the ability to develop applications that work across the internet

- Applet: Java application that can be included in an HTML page on the internet

HTML (hypertext markup language): used for creating/formatting documents on the World wide web, HTML allows users to control fonts, font size, paragraph spacing, without changing original information

Hypertext: document management which documents are stored in a network connected by links (hyperlinks)

Extensible markup Language (XML) improves the functionality of web documents by describing what the data in documents actually mean

- HTML help build web pages and display data on web pages, XML is used to describe data and information

Technology guide 3 – protecting your information assets

• Two types of actions to protect your information assets: behavioral actions and

computer based actions

o Behavioral actions – actions you do not specifically involve a computer

o Computer based actions – relate to safe computing

General behavioral actions – should not provide personal information to strangers in any format (physical, verbal, electronic)

• Protect social insurance number, watch credit cards/debit cards

• In case of identity theft: contact service Canada for sin #, contact

Canada post, cancel credit cards, tell an agency for a fraud alert, file police report, get organized

Computer based actions –

• Actions to prevent malware infections – test your system, install a

security suite on your computer, install an anti-malware product on your computer, install a firewall on your computer, install an

antispyware product on your computer, install monitoring software on your computer

• Internet explorer 7

o Protected mode – ie7 cannot modify any of your files and settings without your

consent

o Activex opt-in – disables all pre-approved controls

o Phishing filter – maintains a list of websites that should be blocked by scanning

for suspicious website characters

o Delete browsing history – erase all personal information stored in the browser

• Other actions that you can take on your computer

o How to detect a worm

o How to detect a Trojan horse

o How to turn off peer-to-peer (P2P) file sharing – p2p makes you a non-

anonymous computer on the internet

o How to look for new an unusual files

o How to detect fake websites

• Protecting your privacy

o Use strong passwords

o Adjust privacy settings on your computer

o Surf the web anonymously – through an anonymous proxy server

• Preparing for personal disasters

o Restoring backup files

• Wireless security

o Hide your service set identifier (SSID) – use a unique number

o Use encryption

o Filter out media access control (MAC) addresses –

o Sniff out intruders

Technology Guide 4 – telecommunications, networks, and the world wide web

• The telecommunications system

o Telecommunication system – consists of hardware and software that transmit

information from one location to another

Transmit text, data, graphics, voice

Transmit information with two basic types of signals: analog and digital

Analog signals - continuous waves that transmit information by altering the characteristics of the waves – ex. Sounds

Digital signals – discrete pulses that are on or off, series of bits 0 and 1

o Communication processors – hardware devices that support data transmission

and reception across a telecommunication device

Modems – convert digital signals to analog signals – called modulation

• Analog signals to digital signals is demodulation

• Cable modems – operate over coaxial cable (ex. Cable tv)

Multiplexer – electronic device that allows a single communication channel to carry data transmissions simultaneously from many sources

Front end processor – many computer systems have a secondary computer dedicated solely to communication

• Communication media and channels

o For data to be communicated from one location to another, the pathway is

communication channels

Divided into two types of media: cable (twisted pair wire, coaxial cable and fibre optic cable) and broadcast (microwave, satellite, radio, and infrared)

Cable or wireless media use physical wire to transmit data

Channel:

• twisted pair wire (adv. Inexpensive, widely available, easy to work

with, - disadv. Slow, subject to interference, easily tapped)

• Coaxial cable (adv. Higher bandwidth, less susceptible to

electromagnetic interference – disadv. Expensive, easily tapped, somewhat difficult to work with)

• Fibre-optic cable (adv. very high bandwidth, inexpensive, difficult

to tap, - disadv. difficult to work with

o Transmission speed –

Bandwidth – range of frequencies available in any communication channel

Narrowband – channels typically provide low speed transmission speed

Broadband – channels provide high speed transmission rates

o Transmission technologies –

Integrated services digital network – older international telephone that uses telephone lines

Digital subscriber line – high speed, digital transmission form homes

Asynchronous transfer mode – almost unlimited bandwidth. Provides support for data, video, and voice transmission

Synchronous optical network – interface standard for transporting digital over fibre-optic lines that allows users to integrate transmission from multiple vendors

T-carrier system – digital transmission system that defines circuits that operate at different rates

• Types of networks

o Computer network – system that connects computers via communications media

so that data can be transmitted among them

Computer networks range from small to large (personal area networks, local area networks, metropolitan area networks, wide area networks, and the internet

Local area network – connects two or more devices in a limited geographical region

• Network interface card – every lan has a NIC that allows the

device to physically connect to the lan’s communication medium

Wide area networks – networks tht conver large geographical areas

• Connect multiple lan’s

• Ex. Internet is a WAN

Enterprise networking

• Multiple LAN’s and multiple WAN’s interconnected for an

enterprise network

• Network fundamentals

o Protocol – set of rules and procedures that work together to adhere to a set of

rules that enables them to work together

Ethernet – common LAN protocol is Ethernet

Transmission control protocol/internet protocol (TCP/IP) – protocol of the internet

• TCP performs 3 basic functions – 1. manages movement of

packets, 2. Sequences the transfer of packets, 3. Acknowledges the packets that have been transmitted

• Internet protocol – responsible for disassembling, delivering, and

reassembling the data during transmission

• Packet switching – transmission technology that breaks up blocks

of text into packets

o Types of network processing – distributed processing divides processing work

among two or more computers (common type of distributed processing is client/server processing, special type of client/server processing is peer-to-peer processing)

client/server computing – links two or more computers in an arrangement in which some machine’s (servers) provide computing services for user PCs (clients)

peer-to-peer processing – type of client/server distributed process in which each computer acts as both a client and server – each computer can access all files on all other computers

• 3 types of peer-to-peer processing: 1. Accesses unused CPU

power among networked computers, 2. Real time person-to-

person collaboration (ex google talk), 3. Advanced search and file sharing

• The internet

o Is a global WAN, a network of networks

Intranet – is a network designed to serve the internal informational needs of a single organization

Extranet – connects parts of the intranets of different organizations and allows secure communications among business partners over the internet using virtual private networks

• Limited accessibility

Darknets – private networks that run on the Internet but are open only to users who belong to the network

• 3 major uses: 1. Contribute to freedom of speech, 2. Enable

companies to create secure networks, 3. Allow people to share illegal music, movie

o Accessing the internet

Connecting via an on-line service - internet service provider (ISP) is a company that offers internet connections for a fee

• Isp’s connect to one another through network access point (NAPs)

– exchange points for internet traffic – key component

Connecting via other means –

• Internet kisosks- for use by people who do not have their own

computers

Addresses on the internet

• Internet protocol (IP) address – each computer on the internet has

an assigned address that distinguishes it from all other computers

• Domain name system (DNS) –

• Domain names – consists of multiple parts, separated by dots

which are read form right to left

• Top-level domain (TLD) – rightmost part of an internet

Future of the internet

• Internet2 – equivalent of CANARAIRE in the united state and is

designed to be fast always, everywhere, intelligent, easy

• The world wide web – is a system of universally accepted standards for storing,

retrieving, formatting, and displaying information via a client/server architecture

o Homepage – a text and graphical screen display that usually welcomes the user

and explains the organization that has established the page

o Website – a;; the pages of a particular company or individual are collectively

known as a website

o Webmaster – person in charge of an organizations website

o Uniform resource locater (URL) – points to the address of a specific resource on

the Web

o Browsers – users access the Web primarily through software applications called

browsers

o Surfing – browsers provide a graphical front end that enables users to point and

click their way across the Web, a process called surfing