Chapter 1 IT for Business and Business Professionals © John Wiley & Sons Canada, Ltd.1-1.

Chapter 1 Chapter 1 IT for Business andIT for Business and

Business ProfessionalsBusiness Professionals

© John Wiley & Sons Canada, Ltd. 1-1

WHAT WE WILL COVER

• The Importance of Information Systems• What’s in IT for Me?• What’s in IT for an Organization?• What’s in IT for Society?


THE IMPORTANCE OF THE IMPORTANCE OF INFORMATION SYSTEMSINFORMATION SYSTEMSIt’s an important part of our

everyday lives.In less than a decade people have

embraced the Internet completely, while other shifts have taken multiple decades.

Technology is improving at 1% each week (Moore’s Law).

People must keep up with changes or be left behind.


WHAT IS AN WHAT IS AN INFORMATION SYSTEM?INFORMATION SYSTEM?

An information system (IS) is an organized collection of people, information, business processes, and

information technology (IT) designed to transform inputs into outputs in order

to achieve a goal.

“ ”


IS COMPONENTSIS COMPONENTSInputProcessOutputDataInformationKnowledge

Information Technology (IT)

Business Processes

PeopleDecisionBusiness Value

data-information-knowledge continuum


Although technology is a key enabler, it is still up to humans to take data and information and turn it into knowledge and wisdom.

Knowledge Hierarchy: showing the relative level of human involvement, cost, and complexity .


IMPORTANT IMPORTANT DIFFERENTIATIONDIFFERENTIATION

Information Systems Information Technology

Combining 3 elements:◦ People

◦ Process

◦ Technology

Transforms inputs to attain a goal

Collection of tools:◦ Hardware

◦ Software

◦ Connectivity

Enabler of achieving goals

Without context of clear goal, the technology is irrelevant

VS


WHAT’S IN IT FOR ME?WHAT’S IN IT FOR ME?Personal Productivity and

EntertainmentCareers:

◦Accounting◦Marketing◦Human Resources◦Finance◦Front-line Roles

Technical or Managerial Paths

◦Entrepreneurship

◦Law◦Consulting◦IT


ICTICTInformation and Communication TechnologiesICT professionals “‘package’ business knowledge, communications skills, leadership, project management, interpersonal effectiveness essentially client and general management capabilities with an ICTS (information and communication technologies and services) flavour.”*

ICT employment continues to grow (2.8% per year) as other areas are in a decline.

Moore’s law ensures that ICT affordability and power will continue to increase.

We will see ongoing innovation of products and services using ICT.

ICT requires continual learning and growth.ICT is being integrated strongly into nearly

all businesses.

*David Ticoll, “ICTS Jobs 2.0: How Canada Can Win in the 21st Century Global Marketplace for Information and Communications Technologies and Services (ICTS),” Developing Tomorrow’s Workforce Today , Information and Communications Technology Council, March 2007.


Cheryl

Direct quote used in book (page 21):8. David Ticoll, “ICTS Jobs 2.0: How Canada Can Win in the 21st Century Global Marketplace for Information and Communications Technologies and Services (ICTS),” Developing Tomorrow’s Workforce Today , Information and Communications Technology Council, March 2007.I added a footnote (asterisk).

WHAT’S IN IT WHAT’S IN IT FOR AN ORGANIZATION?FOR AN ORGANIZATION?Increased Revenue Per CustomerGaining New CustomersIncreased EfficiencyReduced Costs


“Business”An organization with one or more people who 1. decide on common goals to pursue.

2. work together to locate and organize

resources.

3. create processes to achieve the desired

goals.An organizations Business Environment is often a complex

collection of political, economic, social, and technological

factors. These factors all affect the selection of business

goals.

Organizations use advanced information systems to flatten the organization by eliminating stops/interruptions within their processes,

communications etc.

BUSINESS & ISBUSINESS & IS


of IS Types

IS Type What Does it Do?How Does it Help to Create

Business Value?

TPS (transaction processing system)

Captures and processes transactions to make them available to the organization. A transaction is the exchange of something of value the business produces for something in return that the business values (e.g., revenue from product sales).

If a business cannot track its transactions, it will have no way of making decisions about the success or failure of its business processes.

MIS (management information system)Through processing and reporting features, an MIS provides timely information to decision makers.

Timely reports enable managers to monitor critical processes and avoid costly mistakes.

DSS (decision support system)Provides analytical and visualization tools to support and enhance decision making and planning.

Enables managers to make data-based decisions and to discover new business opportunities through the use of its tools.

ERP (enterprise resource planning) system

Integrates and standardizes processes, and centralizes and standardizes the storage and management of data.

Reduces costs associated with duplication of processes and effort. Also, can minimize decision-making mistakes due to multiple versions of the same data, information, and knowledge.

CRM (customer relationship management) system

Integrates data collection, transformation, storage, and analysis of customer transaction data, including purchases, service requests, and other forms of customer contact.

Greatly increases the understanding of customers’ purchasing and service behaviours and needs. Facilitates the timely and proactive management of customers.

Business valueBusiness value


of a TPS (Transaction Processing System)

IS ComponentsIS Components

InputSales records are gathered at point of sale (POS), when a product’s bar code is scanned.

ProcessThe data are added to a sales database table and removed from an available inventory database table.

Output The product is sold.

Data

Information 1 medium, white, Concordia University T-shirt, $19.95, Sept. 9, 2010, 4:06 p.m.

KnowledgeCustomers who purchased white Concordia University T-shirts were also likely to purchase Concordia University beer mugs.

SystemAs part of the TPS, the POS bar code reader allows for a sale to take place by managing the sale’s inventory. The payment module enables the customer to purchase the T-shirt using a credit card.

PeopleThe clerks in the university bookstore have been trained on the system and are able to serve customers efficiently.

ITThe POS hardware (the bar code reader) uses software to read data that are then input into inventory databases, the accounting system, and banks through network connectivity.

DecisionMove the beer mugs closer to the T-shirts to encourage cross-selling of products during the first weeks of September.

Business ValueMore beer mugs and T-shirts were sold in the month of September as students and their parents arrived for the start of the school year.


Ethics in ITEthics in ITThings to Consider

Copyright and PiracyPatent ViolationsReverse EngineeringSpam and Privacy CodesSecurity BreachesCompetitive IntelligenceHiring Practices, Equity, and Equal

OpportunityGreen IT


WHAT’S IN IT FOR WHAT’S IN IT FOR SOCIETY?SOCIETY?Less expensive communication across the

world 24/7Less expensive, easier way to explore the

worldGlobalization due to Internet and Internet-

related technology◦ Expansion of markets◦ Lowest cost suppliers◦ 24-hour business day

Effect: ◦ Multi-lingual capability is expected◦ English becomes a dominant language of global commerce◦ Universal technology standards and professional mandates

are created


Fundamentals…Fundamentals…of this increasingly global digital world. The important issues to address in your business model, often assisted by IS, include some of the following:

Instant access to organization information, reliably and in real-time

Consolidation and amalgamation of resources to optimize costs through best practices

Anywhere, anytime mobile access by customers and clients

Globally savvy marketing and brand reach (often using social media tools)

Understanding and meeting globally complex privacy and security regulations

Competing globally requires constant innovation to become and remain a leader


You must not only consider the ICT sector, but also the

impact of the outputs of this

sector.

The ICT sector has had a higher rate of growth than the Canadian economy since at least 2002

IT AND THE ECONOMYIT AND THE ECONOMY

The information and communications technology (ICT) sector is a major contributor to the economies of the world


TECHNOLOGY INTENSIFICATION TECHNOLOGY INTENSIFICATION RESULTS RESULTS

Digital Divide

A real concern as accessto technology is

associated with access to opportunity as not everyone can afford

access to new technologies.

Identity Theft

One of the most common cyber-crimes. Through IT, much more information can be gathered about a person’s identity much

more conveniently.

e.g. ,virus, spyware, keylogging

Internet Fraud

Such as phishing: criminals send emails posing as legitimate

organizations attempting to get important personal information for a variety

of reasons such as identity theft.

Espionage

Spoofing & Sniffing: gaining access to network

traffic to gain access to information being

transferred on these networks for access to

personal information or to spy on organizations.

Sabotage & Extortion

Gaining access through espionage to hold

information for ransom, to destroy something of

value, or to add a destructive virus or worm.

Cyber-terrorism

"The premeditated, politically motivated attack

against information, computer systems, computer

programs, and data which result in violence against noncombatant targets by

sub-national groups or clandestine agents.”*

*www.crime-research.org/articles/cyber_terrorism_new_kind_terrorism/ , retrieved September 9, 2011.


RECAPRECAP

1. What is an information system?

2. Why is the study of IT so important to any future business professional?

3. What are the most common types of information systems in businesses?


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Chapter 1 IT for Business and Business Professionals © John Wiley & Sons Canada, Ltd.1-1.

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