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Foundations of Information Systems in BusinessFoundations of Information Systems in Business
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Foundation Concepts
Why study information systems and
information technology?
Vital component of successful businesses
Helps businesses expand and compete
Improves efficiency and effectiveness of
business processes
Facilitates managerial decision making
and workgroup collaboration
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What is an Information System?
A i d bi ti fAn organized combination of…
• Peopled d f• Hardware and software
• Communication networks• Data resources• Policies and procedures• Policies and procedures
This system…
• Stores, retrieves, transforms, and disseminates information in an organizationan organization
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Information Technologies
Information SystemsInformation Systems
• All the components and resources necessary to deliver information and functions to the organization
• Could be paper based
Information Technologies
• Hardware, software, , ,networking, data management
Our focus will be on computer‐based information systems (CBIS)y ( )
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What Should Business Professionals Know?
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Fundamental Roles of IS in Business
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Trends
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What is E‐Business?
Using Internet technologies to empower…
• Business processes• Electronic commerce• Collaboration within a company
C ll b i i h• Collaboration with customers, suppliers, and other business stakeholders
In essence, an online exchange of value
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How E‐Business is Being Used
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E‐Business Use
ReengineeringReengineering
• Internal business processes
Enterprise collaboration systems
• Support communications, ppcoordination and coordination among teams and work groups
Electronic commerceElectronic commerce
• Buying, selling, marketing, and servicing of products and services over networksservices over networks
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Types of Information Systems
Operations Support Systemsp pp y
• Efficiently process business transactions
• Control industrial processes• Control industrial processes• Support communication and
collaboration• Update corporate databases
Management Support Systems
• Provide information as reports o o o poand displays
• Give direct computer support to managers during decision‐makingmaking
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Purposes of Information Systems
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Operations Support Systems
What do they do?
•Efficiently process business transactions
•Control industrial processesp•Support communications and collaborationcollaboration
•Update corporate databases
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Types of Operations Support Systems
Transaction Processing Systems
• Record and process business
Process Control Systems
• Monitor and control physical ptransactions
• Examples: sales processing, inventory systems, accounting systems
p yprocesses
• Example: using sensors to monitor chemical processes in a petroleum refinerysystems a petroleum refinery
Enterprise Collaboration Systems
• Enhance team and workgroup i icommunication
• Examples: email, video conferencing
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Two Ways to Process Transactions
Batch ProcessingAccumulate transactions over time andAccumulate transactions over time andprocess periodicallyExample: a bank processes all checksreceived in a batch at nightreceived in a batch at night
Online ProcessingProcess transactions immediatelyExample: a bank processes an ATMwithdrawal immediately
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Management Support Systems
What do they do?Provide information and support forProvide information and support foreffective decision making by managers
Management information systemsDecision support systemsDecision support systemsExecutive information systems
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Types of Management Support Systems
Management Information Systems (MIS)(MIS)
Reports and displaysExample: daily sales analysis reports
i i ( )Decision Support Systems (DSS)Interactive and ad hoc supportExample: a what‐if analysis to determine p ywhere to spend advertising dollars
Executive Information Systems (EIS)Critical information for executives and Critical information for executives and managersExample: easy access to actions of competitorscompetitors
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Other Information Systems
Expert Systems Knowledge Management Systems• Provide expert advice
• Example: credit application advisor
Systems
• Support creation, organization, and dissemination of business knowledge throughout company
• Example: intranet access to best business practicesbest business practices
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Other Information Systems
Strategic Information SystemsStrategic Information Systems
• Help get a strategic advantage over customerover customer
• Examples: shipment tracking, e‐commerce Web systems
Functional Business Systems
• Focus on operational and Focus on operational and managerial applications of basic business functions
• Examples: accounting, finance, or marketingor marketing
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IT Challenges and Opportunities
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Measuring IT Success
EfficiencyEfficiency
• Minimize cost, time, and use of information resourcesinformation resources
Effectiveness
• Support business strategies• Enable business processesp• Enhance organizational
structure and culture• Increase customer and business
valuevalue
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Developing IS Solutions
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Challenges and Ethics of IT
Application of IT
• Customer relationship pmanagement
• Human resources management• Business intelligence systems
Potential Harm
• Infringements on privacy• Inaccurate information• CollusionCollusion
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Challenges and Ethics of IT
Potential Risks Possible Responses•Consumer boycotts•Work stoppages•Government intervention
•Codes of ethics•Incentives•Certification
intervention
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Ethical Responsibilities
What uses of IT might be considered improper or harmful to other individuals or society?
What is the proper business use of the Internet or a company’s IT resources?
How can you protect yourself from computer crime?
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IT Careers
Job increases will be driven bby…
• Rapid growth in computer system design and related services
• The need to backfill positions• Information sharing and
li t/ i tclient/server environments• The need for those with problem‐solving skills
• Falling hardware and software • Falling hardware and software prices, which will fuel expanded computerization of operationsp
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The IS Function
Amajor functional area of businessAn important contributor to operational efficiencyAn important contributor to operational efficiency,employee productivity, morale, customer service andsatisfactionA major source of information and support for decisionmakingA vital ingredient in developing competitive products andA vital ingredient in developing competitive products andservices in the global marketplaceA dynamic and challenging career opportunityA key component of today’s networked business
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System Concepts: A Foundation
System concepts help us understand…
•Technology: hardware, software, data management, telecommunications networks
•Applications: to support inter connected information •Applications: to support inter‐connected information systems
•Development: developing ways to use information technology includes designing the basic components of information systems
•Management: emphasizes the quality, strategic business Management: emphasizes the quality, strategic business value, and security of an organization’s information systems
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What is a System?
A system is…A set of interrelated componentsA set of interrelated componentsWith a clearly defined boundaryWorking togetherT hi t f bj tiTo achieve a common set of objectivesBy accepting inputs and producing outputsIn an organized transformation process
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Basic Functions of a System
InputInput
• Capturing and assembling elements that enter the system to be processedto be processed
Processing
f h• Transformation process that converts input into output
OutputOutput
• Transferring transformed elements to their ultimate destinationdestination
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Cybernetic System
All systems have input, processing, and output
A cybernetic system a self monitoring self regulating A cybernetic system, a self‐monitoring, self‐regulating system, adds feedback and control:
• Feedback is data about the performance of a system• Control involves monitoring and evaluating feedback to Control involves monitoring and evaluating feedback to
determine whether a system is moving toward the achievement of its goal
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A Cybernetic System
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A Business as a System
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Other System Characteristics
If a system is one of the
Several systems may share the
Types of systemsof the
components of a larger system, it is a subsystem
may share the same environment
• Some may be
systems…
• Open• Adaptive
• The larger system is an environment
yconnected via a shared boundary, or interfacete ace
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Components of an IS
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Information System Resources
People Resources
• Specialists• End users
Hardware Resources
• Machines• Media
Software Resources
• ProgramsP d• Procedures
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Information System Resources
Data Resources
• Product descriptions,
Network Resources
• Communications media, pcustomer records, employee files, inventory databases
communications processors, network access and control software
Information Resources
• Management reports and business documents using
d hi di l text and graphics displays, audio responses, and paper forms
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Data Versus Information
Data are raw facts about physical h b iphenomena or business
transactions
Information is data that has been Information is data that has been converted into meaningful and useful context for end users
Examples:
• Sales data is names quantities • Sales data is names, quantities, and dollar amounts
• Sales information is amount of sales by product type, sales territory, or salesperson
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IS Activities
Input of data
Processing of
Output of
Storage of data
Control of data
resources
• Data
ng of data into information
of information products
of data resources
• Data
of system performance
entry activities
• Calculations, comp
• Messages, reports,
elements and datab
• Monitoring and evalu
arisons, sorting, and
co parisons, sorting, and
forms, graphic
s,forms, graphic
asesdatabases ating
feedback
e a uating feedback
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Recognizing Information Systems
Business professionals should be ableto look at an information system andto look at an information system andidentify…
The people, hardware, software, data, andnetwork resources they usenetwork resources they useThe type of information products theyproduceTh th f i t i gThe way they perform input, processing,output, storage, and control activities
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Lot More to Study !!!!!!!!!