1. Introduction to Information Systems BUS 782 David Chao

2. What is an Information System? An organized combination of… –People –Hardware and software –Communication networks –Data resources –Policies and procedures This system… –Stores, retrieves, transforms, and disseminates information in an organization An organizational solution, based on information technology, to challenges posed by the environment.

3. Fundamental Roles of IS in Business

4. Types of Information Systems Operations Support Systems –Efficiently support day-to-day operations Management Support Systems –Provide information and support for effective decision making by managers Strategic Information Systems –Help get a strategic advantage over customer

6. Transaction Processing Systems, TPS –Record and process business transactions Any exchange of money or other benefits between two or more parties Order processing, purchasing General ledger, accounts payable, accounts receivable –Large amount of data, high processing speed, high reliability, accuracy, and security (fault tolerant) –Data: internal, historical, detailed Operations Support Systems

7. Current Trend in Operations Support Systems Enterprise Resources Planning ERP –for the internal world of a company Customer Relationship Management CRM –for the external world of a company.

8. Enterprise Resources Planning, ERP ERP software is multi-module application software that integrates activities across functional departments, from product planning, parts purchasing, inventory control, product distribution, to order tracking. ERP software may include application modules for the finance, accounting and human resources aspects of a business. –Integrated –Cross-functional –Shared database Major vendors: –SAP, Oracle, Microsoft

9. Customer Relationship Management, CRM Front office operations: Direct interaction with customers, e.g. phone calls, e-mail, online services etc. Call Center Sales Force Automation tracks all contact that has been made with a given customer, the purpose of the contact, and any follow up that might be required. Sales Intelligence Cross-selling/Up-selling/Switch-selling Example: SalesForce.Com

10. SaaS and CRM http://www.crmlandmark.com/saasmarket.htm CRM Software as a Service Compared to all CRM Software –Analyst firm Gartner predicted that by 2011, 25 percent of new business software will be delivered by SaaS. –On-Demand CRM growth projected at 17.4% from 2007 through 2013.

11. Types of Management Support Systems Management Information Systems (MIS) –Reports and displays –Example: daily sales analysis reports Decision Support Systems (DSS) –Interactive and ad hoc support –Example: a what-if analysis to determine where to spend advertising dollars Executive Information Systems (EIS) –Critical information for executives and managers –Example: easy access to actions of competitors

12. Management Information Systems Facilitate management control by producing summarized reports that compare actual performance against planned performance on a regular and recurring basis. –Management control: Ensuring that performance meets established standards. Serve middle management Provide reports on firm’s current performance, based on data from TPS

13. Sample MIS Report

15. Other Examples: Budget control: –http://www.olemiss.edu/projects/sap/REPORT S_II_Budget_Control_System.pdfhttp://www.olemiss.edu/projects/sap/REPORT S_II_Budget_Control_System.pdf LYTD VS YTD Sales comparison

16. Budget Control Report

18. Sales Comparison

20. –Serve middle management –Support nonroutine decision making E.g. What is impact on production schedule if December sales doubled? –Often use external information as well from TPS and MIS Decision support systems

21. Information and Management Decisions A decision is a selection between several courses of action: –Penalty for bad decision Information helps reduce uncertainty: –Incomplete information Information systems improve decision- making effectiveness by providing decision makers with information related to the decisions for which they are responsible.

22. Structured Decision –The information requirements are known precisely. –The criteria for making decision are known. –The quality of a decision can be measured precisely.

23. Manager + Computer (DSS) Solution Computer Solution Manager Solution Structured Semistructured Unstructured DEGREE OF PROBLEM STRUCTURE The DSS Focuses on Semistructured Problems

24. Components of DSS Database: Current & Historical Data from Many Sources. –Internal and external data Model base: Collection of Mathematical & Analytical Building Blocks Interface for analysis: What - If Questions ; visual dashboard

25. Using Decision Support Systems What-IF Analysis:Observing how changes to selected variables affect other variables. Sensitivity Analysis: Observing how repeated changes to a single variable affect other variables. Goal-Seeking Analysis:Set a target value for a variable, and then repeatedly changes other variables until the target is achieved. –Example: Benefit.Xls Optimization Analysis Simulation: IBM Innov8 2.0 –http://www-01.ibm.com/software/solutions/soa/innov8/index.html

26. –Support senior management –Address nonroutine decisions requiring judgment, evaluation, and insight –Incorporate data about external events (e.g. new tax laws or competitors) as well as summarized information from internal MIS and DSS Executive support systems

27. Components of an Information System Information technology People Database Procedure

28. People Information specialists –programmer, system analyst, database administrator, etc. End-user: –Menu-level end users –Command-level end users –End-user programmer End-user computing and management

29. 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?

30. Do you think it is wrong to Copy company’s software for use at home? 35 % say no. Use company equipment like computers to search for a new job? 34% say no. Blame your own personal errors on technological glitches? 39% say no. Use office computers to do personal shopping on the Internet? 46% say no.

31. Workplace PCs May Not Be Very Private Don’t be fooled: It may be personal, but it is not private. Cyber-surveillance: The person most likely to be spying on you is your boss. 27% of businesses surveyed by the American Management Association said they review employee email. Reasons: –Productivity –Liability –Network performance

32. Detroit Mayor Kwame Kilpatrick Scandal and Privacy Use city-issued pager Communications are stored for legal reasons. "There's absolutely no expectation of privacy with phones, e-mails, text messages or computers," expert said. Comment: HOW IN THE WORLD DIDTHE PRESS DIG UP TEXT MESSAGES FROM 2001? AND IF THEY CAN DO THAT FOR HIM... THEN WHAT ABOUT OUR PRIVACY RIGHTS AS WELL.. BECAUSE THAT SHOULD BE PROTECTED..IF WE ARE TALKING ON OUR PHONES OR TEXTING..OMG!!!!!!!!

33. Database A group of related files –Support business operations –Provide information

34. An example of database application LuckyMarket presents another great way to save with your LuckyMarket Rewards Card! You can get up to 4 FREE movie tickets! From Feb. 01 through June 9, 2009, use your LuckyMarket Rewards Card every time you shop at Lucky. When you accumulate between $250 - $399.99 in groceries during the qualifying period, you get 2 FREE movie tickets! And if you purchase $400 or more during the same period you get 4 FREE movie tickets!

35. Major Functions of Database Management Creating a database –Analysis: Entity-Relationship Diagram –Design: Design file structure –Implementation Accessing a database Updating a database

36. Database Security Logical protection: –Illegal access –Illegal update –Virus Physical protection

37. Internet firms flocks to store data in blast-proof bunker Some biggest companies are running their Internet operations on systems installed in a 300-foot-deep nuclear blast-proof bunker.

38. Procedures Procedure: A step-by-step process or a set of instructions for accomplishing specific results. –Operations –Backup and Recovery –Security –Development

39. Operations Procedure: A procedure that describes how a computer system or application is used, how often it can be used, who is authorized to use it, and where the results of processing should go. Backup Procedure: A procedure that describes how and when to make extra copies of information or software to protect against losses. –http://www.tldp.org/LDP/lame/LAME/linux- admin-made-easy/server-backup.html Recovery Procedure: An action taken when information or software must be restored. Security Procedure: A procedure designed to safeguard data centers, communications networks, computers, and other IT components from accidental intrusion or intentional damage. Development Procedure: A procedure that explains how IT professionals should describe user needs and develop applications to meet those needs.