Ch. 03 Definition and Role of Information Rev 4: Mar., 2015 Prof. Euiho Suh POSTECH Strategic Management of Information and Technology Laboratory (POSMIT: http://posmit.postech.ac.kr) Dept. of Industrial & Management Engineering POSTECH

Expansion of Nature of Information (1/2) Definition of data Raw facts such as number, name, etc. Definition of information Facts that are organized and arranged in a meaningful manner Definition of Knowledge A justified belief that increases an entity’s capacity for effective action Personalized information related to facts, procedures, concepts, interpretations, ideas, observations, and judgments Data vs. Information vs. Knowledge Data Information Decision Aids Knowledge Statistical Analysis Math Reasoning

Expansion: Examples (2/2) Data- User Independent: Database Number of POSTECH students , Average age, Gender Composition, GPA Information- User Dependent : Informationbase For Employers: Availability of employees, Possible Candidates , etc For BungOBbang Ajuma: Number of Possible customers, Sales per student. Decision Aids- Decision-oriented information in Data Warehouse What is the offer package for recruiting Postech students ? What is the optimal production capacity for my BungOBbang store ? Knowledge- deducible/AI oriented information in Knowledgebase - Expert-based decision for offer package. - Expert-based decision for optimal production

Properties of Information Accuracy Economy Timeliness Completeness Information Relevance Simplicity Reliability Verifiability

Management Hierarchy Level and Information Level of Information Management Triangle Types of management Problem types to be dealt with Political strategic Unstructured Extreme top Strategic Semi – Structured and Top Tactical Middle Operational Structured low Clerical Extreme low

Postech Strategic Management of Information Systems LAB Problem Types Structured Problem Unstructured Problem Semi-structured Problem Input Problem Structure Definite Output Input Problem Structure Fuzzy Output Input Problem Structure User dependent Output User Interaction User Postech Strategic Management of Information Systems LAB

Management Hierarchy Level(2/2) Use of data& Information Quality of Data Types of IS Roles of IS Strategic Importance Extreme top Political decision & strategic High-degree decisional aids EIS/ESS Controller Strategic driver Very important (Strong SIS) Little importance (Weak SIS) Top Mathematical analysis of information Decisional aids DSS Middle Statistical Analysis of data IPS MIS(s) Function Low Retrieval & use for Operational purpose Raw data TPS (EDPS) Helper to Each function Extreme low Data processing OAS Assistant to helper to each function Postech Strategic Management of Information Systems LAB

TIMELINE: Information Systems 1950 1960 1970 1980 1990 2000~ TPS(Transaction Processing System) MIS/IPS(Information Processing System) DSS(Decision Support Sys) EIS(Executive Infor Sys) ESS(Executive Support System) ES(Expert System) ERP(Enteprise Resource Plan) ? This picture represents types of information system 연도순으로. TPS appeared from 1950 to 1960. Mis Ips Dss Ess Eis Es I can’t define in 2000’s Maybe I think it is erp, erp2, km and so on.

Decision Making and Information (1/2) Definition Selecting the best solution from two or more alternatives Levels of Managerial Decision Making Operational Management Operating Managers and Self-Directed Teams Tactical Management Business Unit Managers and Self-Directed Teams Strategic Management Executives and Directors Decisions Information Decision Structure Information Characteristics Unstructured Semistructured Structured Ad Hoc Unscheduled Summarized Infrequent Forward Looking External Wide Scope Prespecified Scheduled Detailed Frequent Historical Internal Narrow Focus

Decision Making and Information (2/2) Decision-making Process (Simon, 1947) Organization objectives Search and scanning procedures Data collection Problem identification Problem ownership Problem classification Problem statement Intelligence Phase Formulate a model Set criteria for choice Search for alternatives Predict and measure outcomes Design Phase Solution to the model Sensitivity analysis Selection of the best(good) alternative(s) Plan for implementation Choice Phase Implementation of solution Satisfaction? END Feedback No Yes

Why do we study Information Systems? General role of IS Collect, distribute, analyze Data Why? Get information Why? Remove uncertainty Why? Make a good decision Why? Store knowledge Postech Strategic Management of Information Systems LAB

DQ/ECQ