IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/ Chapter 1 Why Information Systems Matter

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Information Systems: Definition 1-2 IS is the combination of hardware, software, and telecommunications networks that people build and use to collect, create, and distribute useful data, typically in organizational setting. MIS describes the field in which people develop, use, manage and study computer- based information systems in organizations.

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Data, Info, Knowledge and Wisdom 1-3  Data – raw, unformatted information, such as words and numbers, that often has no meaning in and of itself.  Information – data that has been formatted and/or organized in some way as to be useful/meaningful to people  Knowledge – body of governing procedures, such as guidelines or rules, which are used to organize or manipulate data to make it suitable for a given task.  Wisdom – An accumulated knowledge, gained thro a combination of academic study and personal experience, that gone beyond knowledge by representing broader, more generalized rules and schemas for understanding a specific domains; Allows a person to understand how to apply concepts from one domain to a new situation or problem.

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 IT: The Components of Information Systems 1-4 Manual Operation- any physical effort by humans to complete a task/work Technology- Any mechanical and/or electrical means that can supplement, extend and/or replace human/manual operations or devices. Information Technology (IT)- A type of machine technology that is controlled by or uses information. Computer-based IS- Combination of hardware, software, and telecommunications networks that people build and use to collect, create, and distribute useful data, typically in organizational setting.

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 People: The Builders and Managers of IS 1-5 IS field includes many people who develop, maintain, manage, and study IS Example: CIO, IS director, project mgr, network mgr, system analyst, webmaster, database administrator, system programmer They have ample supply of future job. -Career opportunities are strong and expected to grow for them over the next 8 years cover all industries not only IT (US Bureau of labor stat; 2008) They can expected good pay scale. -Computer/IT analyst is top 10 best paid job (US Bureau of labor stat, 2006) with average income USD for managerial level

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Careers and Salaries in the IS Field (National Average) 1-6

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Careers in IS: Evolution of the CIO 1-7 Chief Information Officer aka IS director/VP of IT An executive-level manager Responsible in 1) integrating new technologies with business strategy; 2) managing daily IS operations job title became popular in 1980s when IS was realized to be able to provide tremendous strategic value Early 1990s – people joked that CIO stands for “Career Is Over”. Many got fired. Reasons because of tight IS budgets and overblown expectation of CIO functions & responsibilities Today, CIO become relevant and vital again. Many large organizations have a CIO or equivalent position

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 IS Personnel 1-8 PAST PRESENT Changing trends in IS personnel 1) Less nerdy men with pocket protectors, but with women 2) IS professional are more polished, who can talk fluently about business and IT 3) Become well-trained, highly skilled, valuable professional who get high wages and play vital roles in firms business performance

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 What Makes IS Personnel Valuable? 1-9  Technical Competency - skills in hardware (platforms, peripherals), software (OS, applications, drivers), networking (NOS, cablings, network interface cards, LAN, WAN, Wireless, Internet, security)  Business Competency – understanding of the nature of the business/industry (business processes, functional areas), managing people/project (POCL), social (interpersonal, group, politic) and communication (verbal, written, non-verbal)  System Competency – understanding of how to build and integrate large scale systems (compatibility and integrating systems), development methodology (SDLC steps), critical thinking and problem solving.

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Hot Skills for 2010 and Beyond 1-10

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Organizations: The Context of IS 1-11 Organizational views of how employees use IS to help their organizations to be more productive/profitable, gain competitive advantages, help to reach more customers, and improve services to them: How to make different types of systems that are used in organizations to be better?  E.g.: transaction processing systems, decision support systems, intelligent systems, etc. These systems used to be cleanly categorized – now the boundaries are fading due to:  Internetworking (connecting host computers/networks to firm larger networks)  Systems integration (connecting separate systems/data to improve business process and decision-making)

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Organizing the IS Function 1-12 How to organize IS function to make them better? IS functions are the developing, implementing and maintaining of info system in organizations Early History: Poor Service and Worse Attitudes  Early systems were cumbersome to use, over budget and late The Rise and Fall of End-User Development in 1980’s  The advent of IBM PC and early applications (BASIC, Dbase, Lotus123 ) led to end-user development  Users developing their own applications or improve existing systems. However, this created problem of control and coordination The Modern Information Systems Organization  Attitudes changed and service mentality emerged

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 End-User Development 1-13 The advent of the IBM PC and early applications packages led to end-user development Source:

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Other Issues Facing the IS Function 1-14 How to manage the spread of technology in organizations? Technologies is firmly integrated and entrenched within various business units/department It becoming difficult to separate the functions and the technologies that supported them and also the people that managed both. IS personnel often having dual-reporting structures- report to business unit and IT dept Problem of managing the IS development (should IS planning be centralized or decentralized

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Other Issues Facing the IS Function How to manage downsizing and outsourcing in organizations, and its effect people careers prospect and opportunities? Many organizations use technology to help them downsize and outsource Reason to cut down costs and move less vital process to be done by outsiders. Downsizing and outsourcing cause problems on people career and opportunities Career prospects and opportunities  There is still a need for IS staff and dept within organizations with analyst skills for designing, developing and managing technologies 1-15

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 The Dual Nature of IS 1-16 Implementing IS can results in benefit or problem. Even if they are developed to support strategy and to provide strategic advantages. Two following cases illustrate the dual nature: London Heathrow—The failure  Automated baggage handling system in 2008  Original system cost of $400 million to handle 35 m passenger annually. Software problem. System went haywire  $ 50 million added costs due to solve the problems FedEx—The success  $ 38 billion family of companies—world largest express transportation company, handles packages to 220 countries/territories daily  Offer services/info via internet/website (  Website become “Info hub for business” (track shipping, find delivery options & costs, prepare shipping documents/bar code etc.)

IS Today (Valacich & Schneider) Copyright © 2010 Pearson Education, Inc. Published as Prentice Hall 10/8/2015 Why Information Systems Matter 1-17 Nicholas Carr’s article (Harvard Business review, May, 2003) —“IT Doesn’t Matter”  IT becomes more pervasive, standardized and ubiquitous  no longer a source of advantage on the firm level  Companies should focus IT on cost reduction and risk mitigation and not for differentiation Many experts disagreed with his arguments  Abbie Lundberg—Interview with Carr  Don Tapscott—“The Engine That Drives Success: The Best Companies Have the Best Business Models Because They Have the Best IT Strategies”  Many successful companies use IT to support a unique business strategy