Chapter 1 Business Information Systems: An Overview
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1 Chapter 1 Business Information Systems: An Overview
2 Learning Objectives When you finish this chapter, you will: Understand why information systems are essential to business.Know how computers process data into useful information for problem solving and decision making.Understand the functions of different types of information systems and how levels within an organization are served by different information systems.
3 Learning ObjectivesUnderstand how telecommunications and database technology can help implement the goals of information systems.Recognize the role of information technology in e-commerce.Know how to evaluate information systems and their roles in organizations.Be able to identify major ethical and societal conflicts created by widespread use of information systems.
4 Information Systems Why Do People Need Information? Individuals - Entertainment and enlightenmentBusinesses - Decision making and problem solvingGatheringStoringManipulating2
5 Data, Information, and Systems Data vs. InformationDataA “given,” or fact: a number, a statement, or a pictureThe raw materials in the production of informationInformationData that have meaning within a contextRaw data or data that have been manipulated
6 Data, Information, and Systems Data ManipulationExample: customer surveyReading through data collected from a customer survey with questions in various categories would be time-consuming and not very helpful.When manipulated, the surveys may provide useful information.
7 Figure 1.1 Input-process-output Generating InformationComputer-based ISs take data as raw material, process it, and produce information as output.Figure 1.1 Input-process-output
8 Information in Context Information needs to be:RelevantCompleteAccurateCurrentEconomical
9 What is a System?System: A set of components that work together to achieve a common goalSubsystem: One part of a system where the products of more than one system are combined to reach an ultimate goalClosed system: Stand-alone system that has no contact with other systemsOpen system: System that interfaces with other systems
10 Data, Information, and Systems Figure 1.3 Several subsystems make up this corporate accounting system.
11 Data, Information, and Systems Figure 1.4 Farmington High School is one subsystem within the Farmington school system.
12 Data, Information, and Systems Information and ManagersSystems thinkingCreates a framework for problem solving and decision making.Keeps managers focused on overall goals and operations of business.
13 Data, Information, and Systems The Benefits of Human-Computer SynergySynergyWhen combined resources produce output that exceeds the sum of the outputs of the same resources employed separatelyAllows human thought to be translated into efficient processing of large amounts of data
14 Humans vs. ComputersFigure 1.5 Qualities of humans and computers that contribute to synergy
15 In an organization, an information systems consists of: DataHardwareSoftwareTelecommunicationsPeopleProcedures
16 Compenents of an ISFigure 1.6 Components of an information system
17 The Four Stages of Processing Input: Data are collected and entered into computer.Data processing: Data are manipulated into information using mathematical, statistical, and other tools.Output: Information is displayed or presented.Storage: Data and information are maintained for later use.
18 Data, Information, and Systems Computer Equipment for Information SystemInput devices introduce data into the IS.The computer processes data through the IS.Output devices display information.Storage devices store data and information.
19 Data, Information, and Systems Figure 1.7 Input-process-output-storage devices
20 ISs From Recording Transactions to Providing Expertise Transaction Processing Systems (TPS)Record data and perform basic processingCash registers and ATMsManagement Information Systems (MIS)Use recorded transactions and other data to produce information for problem solving and decision making.
21 ISs From Recording Transactions to Providing Expertise Types of MISsOn-demand OutputManagers can obtain reports tailored to their needs at any timeDecision Support Systems (DSS)Contain models, or formulas, that manipulate data into informationOften answer “what if?” questionsGroup Decision Support Systems (GDSS) help groups generate ideas, establish priorities, and reach decisions
22 ISs From Recording Transactions to Providing Expertise Executive Information Systems (EIS)Can gather information from vast amounts of data for high-level executivesHighly useful in control and planningExpert Systems (ES)Programmed with human expertiseCan help solve problems of unstructured nature
23 ISs From Recording Transactions to Providing Expertise Geographic Information Systems (GISS)Represents local conditions or featuresAllows planning, decision-making, and monitoring of local conditions or activities
24 Information Systems in Business ISs in Functional Business AreasAccountingRecord business transactions, produce periodic financial statements, and create reports required by lawFinanceOrganize budgets, manage the flow of cash, analyze investments, and make decisions that could reduce interest payments and increase revenues
25 Information Systems in Business MarketingAnalyze demand for various products in different regions and population groupsHuman ResourcesHelp with record keeping and employee evaluation
26 Information Systems in Business ISs in Different Business SectorsManufacturingAllocate resources such as personnel, raw material, and timeControl inventory, process customer orders, prepare production schedules, perform quality assurance, and prepare shipping documents
27 Information Systems in Business ServiceISs are often the backbone of service organizationsRetailSome retail stores (e.g., Wal-Mart, Kmart) now linked to communication networks by satellite.Management can determine which items move quickly and which do not.
28 Information Systems in Business New BusinessesISs have made new products and services possible, such as credit reports and shipment tracking.GovernmentTax authorities, national insurance and welfare agencies, defense departments, economic organizations, immigration authorities.
29 Shared Data ResourcesMost effective way to operate: different systems share same data from same poolCompany’s database: one of the most powerful resourcesCategorized and structured data can be manipulated to produce useful information
30 Shared Data ResourcesFigure 1.8 Computer-based databases are an important resource for any organization
31 Shared Data ResourcesFigure 1.9 Generalized concept of organization information systems
32 E-Commerce E-Commerce Business-to-business and business-to-consumer transactions take place in electronic form via computer networks.Database management online makes information cheaper to distribute.E-commerce is now synonymous with “doing business on the Internet.”
33 Why Study IS? Knowledge Workers Degrees in IS Employers seek computer-literate professionals who know how to use information technology.Degrees in ISComputer Science or Management Information SystemsInformation Systems CareersSystems analysts, Webmaster and database administratorSystems analysts may later choose from various pathsspecialist in enterprise resource planning (ERP) systems, database administrator, telecommunications specialist, consulting, etc.
34 Ethical and Societal Issues The Not-So-Bright Side Consumer PrivacyOrganizations collect (and sometimes sell) huge amounts of data on individuals.Employee PrivacyIT supports remote monitoring of employees, violating privacy and creating stress.
35 Ethical and Societal Issues The Not-So-Bright Side Freedom of SpeechIT increases opportunities for pornography, hate speech, intellectual property crime, and other intrusions; prevention may abridge free speech.IT ProfessionalismNo mandatory or enforced code of ethics for IT professionals--unlike other professions.Social InequalityLess than 20% of the world’s population have ever used a PC; less than 3% have Internet access.