1. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 1 Understanding Information and e-Business Chapter14

2. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 2  Management information system (MIS) A system that provides managers and employees with the information they need to perform their jobs as effectively as possible  Information technology officer A manager at the executive level who is responsible for ensuring that a firm has the equipment necessary to provide the information the firm’s employees and managers need to make effective decisions What Is a Management Information System?

3. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 3 Management Information System (MIS)

4. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 4  A firm’s information requirements Summary of future possibilities Summary of present situation Summary of past performance Information about five areas of management: finance, operations, marketing, human resources, and administration  Size and complexity of the system Must be properly sized to provide sufficient information resources without being too simple or too complex to be useful Management Information System (cont.)

5. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 5  Collecting data Data should be relevant and accurate Internal sources – Managers and employees, company records and reports, minutes of meetings, accounting data, sales data, HR data, production data External sources – Customers, suppliers, bankers, trade and business publications, industry conferences, online computer services, government sources, firms specializing in gathering data Cautions – The cost of obtaining data from some external sources can be quite high – Outdated or incomplete data usually yield inaccurate information – Check computer data (or information) if you disagree with it How Do Employees Use a Management Information System?

6. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 6  Every MIS must be tailored to the organization it serves and must perform five functions

7. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 7  When using a management information system, the first step is to collect the data needed to establish the firm’s database. What is the most appropriate source that could be used to answer the following questions? How successful has the promotional campaign been? How much does a competitor charge for a particular product? What is the current population of the state of Arizona? How do customers view the new pricing policy? What is the average salary for employees in the shipping department? Class Exercise

8. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 8  Storing data An MIS must be capable of storing data until they are needed  Updating data Manual updating—employee inputs fresh data into the database Automatic updating—MIS updates itself as data become available How Do Employees Use a Management Information System? (cont.)

9. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 9  Processing data The transformation of data into a form useful for a specific purpose Statistics – A measure that summarizes a particular characteristic of an entire group of numbers How Do Employees Use a Management Information System? (cont.)

10. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 10  Presenting information Verbal information—list or paragraph form – A formal business report typically includes an introduction, the body of the report, conclusions, and recommendations Visual displays – Graphs, bar charts, pie charts Tabular displays – Verbal or numerical information presented in columns and rows How Do Employees Use a Management Information System? (cont.)

11. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 11  Typical Visual Displays Used in Business Presentations

12. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 12 Typical Three-Column Table Used in Business Presentations

13. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 13 Seven Tips for Effective E-mail Communication

14. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 14  Telecommuting, virtual offices, and technology  Virtual office—allows employees to work any place where they have access to computers, software, and other technology that enables them to perform their normal work activities Benefits – Higher job satisfaction and increased productivity – Greater independence and flexible work hours – No commuting saves costs and time – Lower employee turnover – New employment opportunities for people who can’t/won’t commute Challenges – Feelings of isolation/exploitation – Working too many hours – Lack of support from managers – Inability to access needed information Improving Productivity with the Help of Computers and Technology (cont.)

15. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 15 Using Computers and the Internet to Obtain Information (cont.)  Creating web sites Reflects the company image Should be kept current Most companies manage their sites internally but some pay an outside hosting service to provide site management

16. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 16 Tips for Web Site Development

17. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 17 Top 10 Countries Ranked by % of Internet Users Top 10 Countries with Highest Number of Internet Users # Country or Region 2011 Est.Year 2000 Latest Data (% Population) % Users 1 China 1,336,718,01522,500,000485,000,00036.30%23.00% 2 United States 313,232,04495,354,000245,000,00078.20%11.60% 3 India 1,189,172,9065,000,000100,000,0008.40%4.70% 4 Japan 126,475,66447,080,00099,182,00078.40%4.70% 5 Brazil 203,429,7735,000,00075,982,00037.40%3.60% 6 Germany 81,471,83424,000,00065,125,00079.90%3.10% 7 Russia 138,739,8923,100,00059,700,00043.00%2.80% 8 United Kingdom 62,698,36215,400,00051,442,10082.00%2.40% 9 France 65,102,7198,500,00045,262,00069.50%2.10% 10 Nigeria 155,215,573200,00043,982,20028.30%2.10% Source: Internet World Stats - http://www.internetworldstats.com/top20.htmhttp://www.internetworldstats.com/top20.htm

18. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 18  E-business (electronic business)—the organized effort of individuals to produce and sell, for a profit, the products and services that satisfy society’s needs through the facilities available on the Internet  Organizing e-business resources Resources may be more specialized than in a typical business Outsourcing—the process of finding outside vendors and suppliers that provide professional help, parts, or materials at a lower cost Defining e-Business

19. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 19 Combining e-Business Resources

20. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 20  Satisfying needs online The Internet has created new customer needs E-business can satisfy those needs, as well as traditional ones – Global access to information and entertainment – Virtually unlimited selection of products – Opportunities for interaction – Individually custom-tailored content Satisfying Needs

21. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 21  Creating e-business profit Increasing sales revenue Revenue stream—source of revenue flowing into a firm – Sales of merchandise online – Intelligent information systems to suggest purchases to repeat online customers – Increased sales in physical stores because of product information available online – Advertising on web pages – Subscription fees charged for access to online services and content Creating e-Business Profit

22. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 22  Creating e-business profit (cont.) Reducing expenses – Offering online services that: – Reduce transaction costs – Provide information – Provide customer assistance – Reduces the costs of dealing with customers – Reduces the need for as many physical store locations Creating e-Business Profit (cont.)

23. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 23  Business model A group of common characteristics and methods of doing business to generate sales revenues and reduce expenses  Business-to-business (B2B) model Firms that use the Internet mainly to conduct business with other businesses – Facilitate sales transactions between businesses – Elicit bids and offers from suppliers and potential suppliers; learn about the customer’s rules and procedures. Expensive to start and maintain but savings are significant. Fundamental Models of e-Business

24. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 24  Business-to-consumer (B2C) model Firms that focus on conducting business with individual consumers Success comes from understanding how the customer behaves online to build good customer relationships Fundamental Models of e-Business (cont.)

25. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 25 Planning for a New Internet Business or Building an Online Presence for an Existing Business

26. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 26  The Internet and e-business will continue to expand along with related computer technologies.  Internet growth potential Opportunity: only about 1.8 billion of the world’s nearly 7 billion people use the Web. Americans comprise 12 percent of all users. Internet growth potential in the U.S. is limited since 73 percent of Americans already use it. Projections indicate worldwide users will exceed 2.1 billion by 2012. Social network site—a Web site that functions like an online community of Internet users who share personal information, messages, photos, friends. The Future of Computer Technology, the Internet, and e-Business

27. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 27  Ethical and legal concerns Essentially the Internet is a new “frontier” without borders and without much control by governments or other organizations. Ethics and social responsibility – Spamming – Log-file records – Data mining Internet crime – Malware – Computer virus The Future of Computer Technology, the Internet, and e-Business (cont.)

28. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 28  What do e-business players read to keep up to date on other people, ideas, and trends in the fast-paced world of e-business? Wired: www.wired.comwww.wired.com Fast Company: www.fastcompany.comwww.fastcompany.com The Industry Standard: www.thestandard.comwww.thestandard.com CNET News: www.news.comwww.news.com ZDNet: www.zdnet.comwww.zdnet.com Using the Internet

29. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 29 Chapter Quiz 1. Data presented in a form useful for a specific purpose is A. factual data. B. information. C. statistical data. D. a computer information base. E. a computer network.

30. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 30 Chapter Quiz 2. A(n) ___________ is a smaller version of the Internet for use within a firm. 2. WAN 3. LAN 4. intranet 5. broadband 6. ISP

31. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 31 Chapter Quiz 3. The term that refers to buying and selling activities conducted online is 3. Internet business. 4. e-business. 5. online sales. 6. e-marketing. 7. e-sales.

32. © 2013 South-Western, a part of Cengage Learning. All rights reserved. Chapter 14 | Slide 32 Chapter Quiz 4. Business firms that conduct business with other business firms are using a(n) 4. B2B approach. 5. B2C approach. 6. profit revenue stream. 7. marketing revenue stream. 8. economic benefit revenue stream.