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KNOWLEDGE AREA 2:

INFORMATIONSYSTEMS

BY:

DEVYANI KHARE

ILA JOSHI

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INFORMATION SYSTEMS

It is the totality of technological and human

components that work together to produce the

information systems and services that a

business needs, and that processes informationfor some organisational purpose.

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Knowledge Area 2: Information Systems

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Information systems can be

classified on the basis of:

Degree of formality

Degree or extent of automation applied to them

In relation to decision making

Its value to the organization

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Maturation of Information

Systems

IS has evolved over years on the basis of benefits and

scope of systems.

Benefits in the beginning are seen as simple efficiency

benefits, later an organisation will seek effectiveness

and ultimately it will seek to evolve through the more

advanced use of information systems.

Scope is initially within the single organisation, but soon

will seek to link its systems with key partners, especially

suppliers and customers - a community effect.

Ultimately, systems are seen to be important at the

national level.

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Combination of Benefits and scope reveals

about management thinking development over

the years.

Different stages depicting the evolution ofinformation systems.

Stage 1 internal efficiency

Stage 2 internal effectivenessStage 3 internal evolution

Stage 4 external efficiency

Stage 5 external effectiveness 11/26/2012

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Stage 6 Industry evolution

Stage 7 National and international efficiency

Stage 8 National and international

effectiveness

Stage 9 National and international evolution

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Life cycle of Information Systems-

application portfolio

Four stages of IS as a product:

High potential IS(Applications that are critical

to sustaining future business strategy)

Strategic IS (Applications that are critical to

sustaining future business strategy )

Key operational IS (Applications on which the

organisation currently depends for success) Support IS (Applications that are valuable but

not critical to success)

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Classifying Applications

Value of application should be assessed in

terms of future potential, ability to extend,

integrate, develop and transfer.

A decision will emerge from a managementdiscussion about an application, its current

and future potential.

Key factors are High Potential, strategic,Key operational and support application.

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Strategic analysis in complex

businesses

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Corporation

Groups or

divisions

Business units

Functions or

department

Individuals

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A business unit is one that has a single familyof products with like characters and identifiablecompetition is at a known point in its businessmaturity lifecycle.

The role of systems evolve over time and theywill need to be migrated from one portfoliosegment to another, require a change in style

of management over time.ATM is a good example. Initially, this idea was

met with derision and later it was acceptedseriously.

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Relationships with benefits

There is a life-cycle to most systems ideas

and management recognition of lifecycle is

critical to exploit the benefits of an idea.

High potential- understanding

Strategies- competitive advantage

Key operations-improved efficiency

Support- Benefits are localized, vanishinglysmall.

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Information System Project

Management

Information system have to be developed and

implemented by means of project

management.

Four quadrants of the portfolio are-

1. Management style

2. Project style

3. Risk management

4. Funding

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Communicating Information

Systems Ideas

We need some means to communicate our

ideas, to specify the requirement in order that

a solution can be designed and built.

A more considered approach to businessmodeling deals with-

1. Organizational elements

2. Jobs that people do3. Information that people work with

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Business and System Analysis

There are two principle ways to visualise an

information system: Process Analysis and

Information Analysis.

Terminology is not universally agreed and there

are conflicting uses of terms such as 'process',

'function', 'information' and 'data'.

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'Entity' refers to any element of a business about which wewish to keep information (for example: customers, suppliers,products, employees, sales, problems).

'Information' refers to the aggregation of data that - when it isinterpreted and understood - provides systems users with

knowledge of some kind (for example: invoice, pay slip, stockexception report).

Activity refers to a task that accomplishes the processing ofinformation at a low level, and delivers an output (for example:check customer credit, process sales order, deal with stockenquiry).

'Process' refers to that collection of activities that delivers notoutput but an outcome typically something that is valued byan organisational stakeholder (for example: sales orderfulfilment, new product design, employee management, andso on).

Key words used

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IS/IT Partnerships

Transactional relationship

Partnership relationships

Risk and profit sharing relationship

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Outsourcing

Reasons for outsourcing: Reduction in operational costs

Access to scarce specialist skills

Improvement in reliability of service

Deployment of the latest technologies with realeconomies of scale.

Risks in outsourcing: Chosen service provider might fail.

Their key staff might relocate elsewhere, where theycould inform your competitors about critical aspects ofyour plans and strategic activities.

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Managerial issues in IS

System development capability

Relationship management

Investment justification

Benefits management

Performance management

Encouraging new thinking

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