1. McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter 1 Foundations of Information Systems in Business

2. 1-2 Learning Objectives  Understand the concept of a system and how it relates to information systems.  Explain why knowledge of information systems is important for business professionals, and identify five areas of information systems knowledge that they need.

3. 1-3 Learning Objectives  Give examples to illustrate how the business applications of information systems can support a firm’s business processes, managerial decision making, and strategies for competitive advantage.  Provide examples of several major types of information systems from your experiences with business organizations in the real world.

4. 1-4 Learning Objectives  Identify several challenges that a business manager might face in managing the successful and ethical development and use of information technology in a business.  Provide examples of the components of real world information systems. Illustrate that in an information system, people use hardware, software, data, and networks as resources to perform input, processing, output, storage, and control activities that transform data resources into information products.  Demonstrate familiarity with the myriad of career opportunities in information systems.

5. 1-5 Section 1 Foundation Concepts: Information Systems in Business

6. 1-6 I. The Real World of Information Systems  Information Systems are an essential field in the study of business administration and management.  IS and IT and Internet technologies play vital roles in business and improve the effectiveness and efficiency of business processes, managerial decision making, and workgroup collaboration.

7. 1-7 II. The Fundamental Roles of IS in Business  Support of Strategies for Competitive Advantage  Support of Business Decision Making  Support of Business Processes and Operations

8. 1-8 IV. The Role of e-Business in Business  E-Business – use of Internet technologies to empower business processes, e-commerce, and enterprise collaboration within a firm and its customers, suppliers, and stakeholders  Enterprise Collaboration Systems – support communication, coordination, and collaboration among networked teams/workgroups  E-Commerce – buying, selling, marketing, and servicing products, services, and information over computer networks

9. 1-9 VI. Managerial Challenges of Information Technology  The IS Function  IS is a major functional area of business, just as important as any business function  IS is an important contributor to operational efficiency, employee productivity and morale, and customer services and satisfaction  IS is an important strategic resource

10. 1-10 Section 2 Foundation Concepts: The Components of Information Systems

11. 1-11 I. System Concepts: The Foundation for Business Processes  What Is a System?  Input – capture the data to be processed  Processing – change the data into information  Output – disseminate the information product to its destination  Feedback and Control  Feedback – data about the performance of the system  Control – monitoring the feedback to determine if the system is meeting its objectives

12. 1-12 III. Information System Resources  People Resources  IS Specialists  End Users  Hardware Resources  Machines – the computing devices themselves  Media – where data is stored

13. 1-13 III. Information System Resources  Software Resources  Programs – instructions that tell the computer what to do  System Software – runs the computer  Application Software – a particular use by end users  Procedures – instructions on how to use the system

14. 1-14 III. Information System Resources  Data Resources  Data – unorganized facts and figures  Information – data organized so that it has value to the organization  Network Resources  Communications Media- the physical pathways over which signals travel  Network Infrastructure – hardware, software, and data technologies needed to support communications networks

15. 1-15 IV. Information System Activities  Input of Data Resources  Processing of Data into Information – organize, analyze, and manipulate data  Output of Information Products – dissemination of information products to appropriate end users  Storage of Data Resources  Control of System Resources – monitoring feedback to assure the system meets its performance standards

16. 1-16 Phone Dis Patch ers RWC 1. eCourier, Cablecom, and Bryan Cave: Delivering Value through Business Intelligence 2000packs/ A day around London   The couriers can be tracked and orders can be communicated electronically   They also focused on making online booking easy and rewarding   And much was invested in user-friendly applications   When a new booking enters eCourier’s database the information is duplicated and saved into a repository within SeeWhy.   The software then interprets the data by comparing it with previous information and trends, and if it notices an anomaly, it takes action   If a customer typically places an eCourrier order every Thursday morning between 9:00 and 10 and there’s been no contact during that time, eCourier’s CRM team will receive an alert shortly after 10 that includes the client’s history and the number of bookings it typically places in a day Account managers could miss the same issues that plagued other courier services   Late deliveries   Surly couriers   Unnoticed ramp-up in deliveries   These capabilities have provided a big payoff.   The system saves the expense of having to hire people to monitor for “who’s happy and who’s not – we’re able to do a lot more on our customer team with a lot less” Giving their couriers a GPS-enabled handhelds Using a software, SeeWhy Operational business Intelligence allows the company to keep real-time tabs on customer satisfaction The company needed to provide better services to their customers to make them happier Operation issue

17. 1-17 Fee issue Clients were demanding alternatives to the traditional hourly fee structure.   It required the complicated balance of staffing and pricing.   Projects weighted too heavily with a law partner’s time would be expensive ( for the law firm) and not optimized for profit.   Devoting too little of a partner’s time would leave clients feeling undervalued.   Optimizing profit and perceived value had to be achieved by spreading partners’ time throughout a number of cases and balancing the remaining resources needed for a case with the less-expensive fees of associates and paralegals.   Both profitability and hours leveraged ( the hours worked by equity partners and all other fee earners at the firm) have increased substantially   It also allow lawyers to track budgets in real time so they can quickly make adjustments.   It even provide a diversity dashboard, which tracks the hourly mix of women and minorities working on the firm’s cases, a feature the company will license to Redwood Analytics for sale to other law firms. The firm developed this diversity tool to bring transparency to the diversity reporting process required by many clients.   (e.g.) The customized pricing one lawyer gave to his real estate client. Developers think in terms of square feet and this client couldn’t understand why legal fees for a 400,000- square-foot building might be the same as legal fees for a 4000-square-foot building, even though it required the same amount of the lawyer’s time. So the lawyer used the pricing and staffing modeling tools and historical analysis tools to determine whether it made sense for the law firm to charge clients based on the size of their projects. While there was risk of underpricing large buildings, the deal volume in small buildings offset that risk for the law firm. The result made per- square-foot pricing possible. New pricing models, such as fixed pricing and pricing that was adjusted during a project To be in touch with clients using Business Intelligence Spread sheet Making the most money with your resources while simultaneously delivering the highest customer value with BI

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19. 1-19 RWC 2. The New York Times and Boston Scientific : Two Different Ways of Innovating with Information Technology