Presentation on theme: "Foundations of Information Systems"— Presentation transcript:
1 Foundations of Information Systems Why should you study information systems?How does a firm use information systems?What are the components of an information system?
2 Why study Information Systems and Information Technology? Vital component of successful businessesHelps businesses expand and competeBusinesses use IS and ITTo improve efficiency and effectiveness of business processesFor managerial decision makingYou might just as well ask why study accounting, finance, operations management, marketing, human resources, management.Most business majors include a class in IS.
3 What is a system? A system Is a set of interrelated components With a clearly defined boundaryWorking together to achieve a common set of objectives“A system is an orderly grouping of interdependent components linked together according to a plan to achieve a specific objective”Almost everything is a systemOne system can be made up of other systems or can be part of a bigger system
4 Characteristics of a System OrganizationInteractionInterdependenceIntegrationCentral Objective
5 Elements of a System Input and Output Processor Control Feedback EnvironmentBoundaries and Interface
6 Types of Systems Physical or Abstract Open or Closed Characteristics of Open SystemInput from outsideEntropyProcess, output and cyclesDifferentiationEquifinality“man-made” information systemsFormal Information SystemsInformal Information SystemsComputer-Based Information Systems
7 What is a system(again)? Is a set of interrelated componentsWith a clearly defined boundaryWorking together to achieve a common set of objectivesBy accepting inputs and producing outputs in an organized transformation processRepeating definition from earlier but adding accepting inputs, producing outputs, and transformation
8 Systems have three basic functions: Input involves capturing and assembling elements that enter the system to be processedProcessing involves transformation process that convert input into outputOutput involves transferring elements that have been produced by the transformation process to their ultimate destination
9 A business as a systemA business can be viewed as a system. This system does not operate in a vacuum rather it functions in an environment containing other systems. A business is an open system in that it interacts with other systems in the environment. It is also an adaptive system in that it can change itself or its environment in order to survive.
10 Data versus Information Data are raw facts about physical phenomena or business transactionsInformation is data that has been converted into meaningful and useful context for end usersExample:Sales data is names, quantities and dollar amountsSales information is amount of sales by product type, sales territory or salesperson
11 What is an Information System? An organized combination ofPeopleHardwareSoftwareCommunications networksData resourcesPolicies and proceduresThat stores, retrieves, transforms, and disseminates information in an organizationThis is a simple definition that we will expand upon laterWhat’s an example?Smoke signals to transmit informationCard catalogs in a libraryBook bag with day planner, notebooks, that allows you organize inputs from lectures, presentations and discussions. The output is homework and good exam gradesCash register at restaurantOther examples?
12 Components of an IS People Hardware Resources Software Resources End users: the people who use the IS or the information from the ISIS specialists: the people who develop and operate ISHardware ResourcesAll physical devices used in information processingMachines, data media, peripheralsSoftware ResourcesAll information processing instructions including programs and proceduresSystem software, application software and proceduresHardware:Peripherals include keyboard, mouse, video screen, printer
13 Components of an IS (cont.) Data ResourcesFacts about the business transactionsProcessed and organized informationDatabases of organized dataNetwork ResourcesCommunications mediaNetwork infrastructure: hardware and softwareThe Internet, intranets and extranetsCommunications media: twisted pair wire, coaxial cable, wireless technologies
14 Information System (IS) versus Information Technology (IT) IS is all the components and resources necessary to deliver information and functions to the organizationIT is hardware, software, networking and data managementIn theory, IS could be paper basedBut we will focus on Computer-Based Information Systems (CBIS)Definition of IS from prior slide:An organized combination ofPeopleHardwareSoftwareCommunications networksData resourcesPolicies and proceduresThat stores, retrieves, transforms, and disseminates information in an organizationIn theory, an IS could be pencil and paper based
15 IS Function represents Major functional area of businessImportant contributor to operational efficiency, employee productivity, morale, customer service and satisfactionMajor source of information and support for effective decision makingVital ingredient in developing competitive products and services in the global marketplaceDynamic and challenging career opportunityKey component of today’s networked business
16 Information systems model Major components of an information: people, hardware, software, data and networks.These components perform input, processing, output, storage, and control activities.
17 What should a Business Professional know about IS? Foundation Concepts: fundamental behavioral, technical, business and managerial conceptsInformation Technology: Hardware, software, networks, data management and Internet-based technologyBusiness Applications: Major uses of the IS in the organizationDevelopment Processes: How to plan, develop and implement IS to meet business opportunitiesManagement Challenges: The challenges of effectively and ethically managing ITRefers back to figure 1.2 on prior slideFoundation Concepts: Examples: general systems theory, competitive strategies. Covered in chapters 1, 2Information Technology: Covered in chapters 3-6Business Applications: Chapter 7: applications in functional areas, Chapter 8: electronic commerce applications and Chapter 9: decision makingDevelopment Processes: By both business professionals and IS specialists. Chapter 10.Management Challenges: Managing IT at the end user, enterprise and global levels of a business. Chapter 11 is security challenges and Chapter 12 is how to manage IT in global businesses.
18 IS Knowledge Framework for Business Professionals
19 What does IS do for a business? Examples of business processes: record purchases, track inventory, pay employees, etc. Business would stop without such IS.Examples of decision making: what lines of merchandise need to be added, what kind of investment required.Examples of competitive advantage: put kiosk in store to connect to e-commerce website. Help gain advantage over competitor without such a kiosk.
20 Business Applications expanding role over time Note that while IS has expanded, they are still doing the same basic things that they’ve been doing.What has changed is: more integration of functions, greater connectivity across components, better use for maximum advantage of business and strategic opportunities
22 Operations support systems What are they?Efficiently process business transactionsControl industrial processesSupport communications and collaborationUpdate corporate databases
23 Types of Operations Support Systems Transaction Processing SystemsRecord and process data from business transactionsExamples: sales processing, inventory systems, accounting systemsProcess Control SystemsMonitor and control physical processesExample: in a petroleum refinery use sensors to monitor chemical processesEnterprise Collaboration SystemsEnhance team and work group communicationsExamples: , videoconferencing
24 Two ways to process transactions Batch Processing:Accumulate transactions over time and process periodicallyExample: a bank processes all checks received in a batch at nightOnline Processing:Process transactions immediatelyExample: a bank processes an ATM withdrawal immediately
25 Management Support Systems What are they?Provide information and support for effective decision making by managers
26 Types of Management Support Systems Management Information Systems (MIS)Provide reports and displays to managersExample: daily sales analysis reportsDecision Support Systems (DSS)Provide interactive ad hoc support for decision makingExample: A what-if-analysis to determine where to spend advertising dollarsExecutive Information Systems (EIS)Provide critical information for executives and managersExample: easy access to actions of competitors
27 Operational or Management Systems Expert SystemsProvide expert adviceExample: credit application advisorKnowledge Management SystemsSupport creation, organization and dissemination of business knowledge throughout companyExample: Intranet access to best business practicesSupport either operations or management applications
28 Classifications of IS by scope Functional business systemsFocus on operational and managerial applications of basic business functionsExamples: support accounting, finance or marketingStrategic information systemsHelp get a strategic advantage over its customersExamples: shipment tracking, e-commerce web systemsCross-functional information systemsSystems that are combinations of several types of information systemsProvide support for many functionsIn reality most systems are Cross-functional
30 Measuring success of an IS EfficiencyMinimize cost, time and use of information resourcesEffectivenessSupport business strategiesEnable business processesEnhance organizational structure and cultureIncrease the customer and business valueWhat’s the difference between Efficiency and Effectiveness?
33 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?What uses of IT might be considered improper or harmful to other individuals or society? Improper uses might include collecting data that you don’t need, not protecting personal customer data, etc.What is the proper business use of the Internet or a company’s IT resources? Is it proper to use the company’s computers to surf the web, send personal , etc.How can you protect yourself from computer crime? Virus and spam protection, never replying to phishing, etc.
34 IS Activities Input of data resources Data entry activitiesProcessing of data into informationE.g., calculate, compare, sort, classify, summarizeOutput of information productsMessages, reports, forms and graphic imagesStorage of data resourcesData elements and databasesControl of system performanceMonitoring and evaluating feedback
35 Recognizing ISAs a business professional, you should be able to look at an IS and identifyThe people, hardware, software, data and network resources they useThe type of information products they produceThe way they perform input, processing, output, storage and control activities
36 Case : Aviall Inc. From Failure to Success with IT Supplier of airplane parts and componentsHad lost track of its inventoryPrice-tracking software didn’t work with inventory control or purchasing forecastingSent wrong parts to wrong customersSales fallingNeeded a middleware vision: get all the software to work together
37 Case Study QuestionsWhy do you think that Aviall failed in their implementation of an airplane parts and components inventory control system?How ahs information technology brought new business success to Aviall? How did IT change Aviall’s business model?How could other companies use Aviall’s approach to the use of IT to improve their business success? Give several examples.