1. Slide 2-1 Chapter 2 Information Systems in Organizations Introduction to Information Systems Judith C. Simon

2. Slide 2-2 "Copyright © 2001 John Wiley & Sons, Inc. All rights reserved. Reproduction or translation of this work beyond that permitted in Section 117 of the 1976 United States Copyright Act without the express written permission of the copyright owner is unlawful. Request for further information should be addressed to the Permissions Department, John Wiley & Sons, Inc. The purchaser may make back-up copies for his/her own use only and not for distribution or resale. The Publisher assumes no responsibility for errors, omissions, or damages, caused by the use of these programs or from the use of the information contained herein."

3. Slide 2-3 Chapter 2 Major Topics ä Common types of information systems ä Strategic and other managerial uses of information systems ä Strategic decisions related to information systems ä Functional uses of information systems ä New concerns because of information technology

4. Slide 2-4 Transaction Processing System (TPS) ä Transaction: some business activity, such as the sale of a product or service ä TPS was one of the first types of business information systems to be developed ä TPS maintains records of business transactions and analyzes the data to provide desired output

5. Slide 2-5 Transaction Processing Systems

6. Slide 2-6 Batch Processing 1 2 5 6 3 4 All transactions will be checked as a group without human interaction. Transactions of mail-order purchases via credit card

7. Slide 2-7 Online Processing These transactions require human interaction. Invalid credit card numbers are checked by clerks

8. Slide 2-8 Information Reporting System ä One of the first forms of management information system ä Developed initially to provide reports to management based on transaction processing systems ä Examples of reports: inventory quantities available for each product, processing costs, product sales per produce or per sales representative, exception reports

9. Slide 2-9 Information Reporting Systems Dear Sir: This letter is to inform you of the Information Report Systems Examp that where used are now

10. Slide 2-10 Management Levels and Decision Types ä Top management: ä Makes “strategic” decisions; does long-term planning; typically uses more external data than other levels ä Middle management: ä Makes “tactical” decisions; does shorter-term planning than top management; converts top management desires into action plans ä Lower management: ä Makes “operational” decisions; uses more detailed internal data than other levels; has more structured decisions than other levels

11. Slide 2-11 Managerial Uses of Information Top Management Strategic Decisions Middle Management Tactical Decisions Lower Management Operational Decisions Information systems provide managers at different levels with decision-making information.

12. Slide 2-12 Functional Uses of IS - Examples ä Human resources IS: handles pre-employment activities and employee data ä Accounting/Financial IS: maintains transaction records, e.g., for receivables and payables, as well as data for budgeting and financial planning ä Marketing/Sales IS: used for such activities as advertising decisions, order management, trends analysis ä Production/Operations IS: handles creation of products and services and methods of providing these items to others

13. Slide 2-13 Human Resources Activities Strategic Check external databases for city being considered in expansion plans to determine skill levels of potential employees.

14. Slide 2-14 Human Resources Activities Tactical Analyze database of performance records of current employees to assist in developing training program for the next six months

15. Slide 2-15 Human Resources Activities Operational Complete on-screen evaluation forms of employee performance

16. Slide 2-16 Cross-Functional Relationships ä Cross-functional relationships have become a major part of IS developments, with multiple functions working together to produce the best result ä Supply chain: sequence of processes and partners that deliver products and services to a customer ä Demand chain: handling customer product or service demands ä Value chain: entire process from initial demand through supplying of product or service

17. Slide 2-17 Global Concerns ä Businesses today must expect work and trade to occur around the world and around the clock and must plan and make strategic decisions accordingly ä Businesses must be knowledgeable about technology issues in working with other countries to determine the best combinations of locations ä Local businesses must realize that they are are competing globally even if they do not have physical facilities in other countries

18. Slide 2-18 A Global Concern is... Businesses can now compete with your organization worldwide regardless of their home location.

19. Slide 2-19 Ethical Issues ä Business ethics refers to professional standards of conduct. ä Ethical issues include ä Privacy, primarily concerned with keeping confidential data confidential ä Security, including protection of data, hardware, and software ä Accuracy, ensuring that data cannot be changed without authorization ä Ownership, also referred to as intellectual property, identifying clearly who has the rights to items developed and protecting those rights

20. Slide 2-20 An Ethical Concern is... Technology’s rapid developments have outpaced the creation of laws and guidelines for appropriate behavior in using and developing the technology.

21. Slide 2-21 Social Issues ä Social issues are related to maintaining or improving the quality of life. ä Social issues related to computer use include ä working conditions ä education ä environmental protection ä health care ä public transportation

22. Slide 2-22 A Social Concern is... Technology can increase the capability of studying social issues but can also cause new issues to arise, such as waste of natural resources.

23. Slide 2-23