Fundamentals of Information Systems, Second Edition 1 Information Systems in Organizations

Fundamentals of Information Systems, Second Edition

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Information Systems in Organizations


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Principles and Learning Objectives

• The value of information is directly linked to how it helps decision makers achieve the organization’s goals.


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• Knowing the potential impact of information systems and having the ability to put this knowledge to work can result in a successful personal career, organizations that reach their goals, and a society with a higher quality of life.


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• System users, business managers, and information systems professionals must work together to build a successful information system.


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• The use of information systems to add value to the organization can also give an organization a competitive advantage.


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• Information systems personnel are the key to unlocking the potential of any new or modified system.


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Information Concepts


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Information System

• A set of interrelated components that collect, manipulate & disseminate data & information & provide feedback to meet an objective.

• Examples: ATMs; airline reservation systems; course reservation systems


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Data vs. Information

• Data: raw facts

• Information: collection of facts organized in such a way that they have value beyond the facts themselves


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The Process of Transforming Data into Information


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Characteristics of Valuable Information


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The Components of an Information System


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Computer-Based Information Systems (CBIS)


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Components of a CBIS


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Components of a CBIS• Hardware - computer equipment used to perform input, processing,

and output activities.

• Software - computer programs that govern the operation of the computer.

• Database - an organized collection of facts and information, typically consisting of two or more related data files.

• People - the most important element in most computer-based information systems.

• Procedures - include the strategies, policies, methods, and rules for

using the CBIS.


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Telecommunications, Network, and the Internet

• Telecommunications - the electronic transmission of signals for communications.

• Networks - used to connect computers and computer equipment in a building, around the country, or around the world to enable electronic communications.

• Internet - the world’s largest computer network, actually consisting of thousands of interconnected networks


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Business Information Systems


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Business Information Systems

• Electronic Commerce• Transaction Processing Systems and ERP• Information and Decision Support Systems• Special-Purpose Business Information Systems: Artificial

Intelligence, Expert Systems, and Virtual Reality


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E-Commerce

• Business-to-business

• Business-to-consumer

• Consumer-to-consumer


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E-Commerce Greatly Simplifies the Purchasing Process


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Transaction Processing Systems and ERP

• Transaction processing system (TPS) - an organized collection of people, procedures, software, databases, and devices used to record completed business transactions.

• Enterprise Resource Planning (ERP) System - a set of integrated programs capable of managing a company’s vital business operations for an entire multisite, global organization.


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A Payroll Transaction Processing System


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Functional Management Information Systems Draw Data from the Organization’s TPS


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Decision Support Systems (DSS)

An organized collection of people, procedures, software, databases, and devices used to

support problem-specific decision making.

– The focus of a DSS is on decision-making effectiveness.


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Essential DSS Elements


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Special-Purpose Business Information Systems

• Artificial intelligence (AI) systems

• Virtual reality systems

• Expert systems


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The Major Elements of Artificial Intelligence


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Systems Development

The activity of creating or modifying existing business systems. – Systems Investigation– Systems Analysis– Systems Design– Systems Implementation– Systems Maintenance and Review


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Organizations and Information Systems


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A General Model of an Organization


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The Value Chain of a Manufacturing Company


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Technology Diffusion, Infusion, and Acceptance

• Technology Diffusion - a measure of how widely technology is spread throughout an organization.

• Technology Infusion - is the extent to which technology permeates an area or department.

• Technology Acceptance Model (TAM) - specifies the factors that can lead to higher acceptance and usage of technology in an organization


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Competitive Advantage

A significant and (ideally) long-term benefit to a company over its competition.

• Factors That Lead Firms to Seek Competitive Advantage– Rivalry among Existing Competitors – Threat of New Entrants– Threat of Substitute Products and Services– Bargaining Power of Customers and Suppliers


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Strategic Planning for Competitive Advantage

• Altering the Industry Structure• Creating New Products and Services• Improving Existing Product Lines and Services• Using Information Systems for Strategic

Purposes


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Competitive Advantage Factors and Strategies


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Performance-Based Information Systems

• Productivity• Quality• Return on Investment and the Value of

Information Systems– Earnings Growth– Market Share– Customer Awareness and Satisfaction– Total Cost of Ownership


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Three Stages in the Business Use of IS


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Roles, Functions, and Careers in the Information Systems Department

• Operations• Systems Development• Support


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The Three Primary Responsibilities of Information Systems


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Typical IS Titles and Functions

• The Chief Information Officer• LAN Administrators• Internet Careers


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Why Learn About Information Systems?

• Advance in your career• Solve problems• Realize opportunities• Meet your career goals


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Summary

• Data - raw facts• Information - data transformed into a

meaningful form • Systems development - creating or modifying

existing business systems• Organization - a formal collection of people and

various other resources established to accomplish a set of goals

Documents

Fundamentals of Information Systems, Second Edition 1 Information Systems in Organizations