8/4/2019 MIS James A. O'Brian Chap 01

1/53

1 - 1Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Foundations ofInformation Systems

in Business

Chapter

1

8/4/2019 MIS James A. O'Brian Chap 01

2/53

1 - 2Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

1. Explain why knowledge of informationsystems is important for businessprofessionals and identify five areas ofinformation systems knowledge they need.

2. Give examples to illustrate how the businessapplications of information systems can

support a firms business processes,managerial decision making, and strategiesfor competitive advantage.

Learning Objectives

8/4/2019 MIS James A. O'Brian Chap 01

3/53

1 - 3Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Learning Objectives

3. Provide examples of several major typesof information systems from yourexperiences with business organizations

in the real world.

4. Identify several challenges that a

business manager might face inmanaging the successful and ethicaldevelopment and use of informationtechnology in a business.

8/4/2019 MIS James A. O'Brian Chap 01

4/53

1 - 4Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Learning Objectives

5. Provide examples of the components ofreal world information systems. Illustratethat in an information system, people

use hardware, software, data andnetworks as resources to perform input,processing, output, storage, and controlactivities that transform data resources

into information products.

8/4/2019 MIS James A. O'Brian Chap 01

5/53

1 - 5Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Why Study Information Systems?

Information technology can help all kindsof businesses improve the efficiency andeffectiveness of their business processes,

managerial decision making, andworkgroup collaboration, thusstrengthening their competitive positionsin a rapidly changing marketplace.

8/4/2019 MIS James A. O'Brian Chap 01

6/53

1 - 6Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Why Study Information Systems

Internet-based systems have become anecessary ingredient for business successin todays dynamic global environment.

Information technologies are playing anexpanding role in business.

8/4/2019 MIS James A. O'Brian Chap 01

7/531 - 7Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

What is an Information System?

Any organized combination of people,hardware, software, communicationsnetworks, and data resources that stores,

retrieves, transforms, and disseminatesinformation in an organization.

8/4/2019 MIS James A. O'Brian Chap 01

8/531 - 8Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Information Systems vs.Information Technology

Information Systems (IS) allcomponents and resources necessary todeliver information and information

processing functions to the organization

Information Technology (IT) various

hardware components necessary for thesystem to operate

8/4/2019 MIS James A. O'Brian Chap 01

9/531 - 9Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Types of Information Technologies

Computer Hardware Technologiesincluding microcomputers, midsize servers, and largemainframe systems, and the input, output, and storagedevices that support them

Computer Software Technologiesincluding operating system software, Web browsers,software productivity suites, and software for businessapplications like customer relationship management andsupply chain management

8/4/2019 MIS James A. O'Brian Chap 01

10/531 - 10Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Types of Information Technologies

Telecommunications NetworkTechnologiesincluding the telecommunications media, processors,and software needed to provide wire-based and

wireless access and support for the Internet and privateInternet-based networks

Data Resource Management

Technologiesincluding database management system software forthe development, access, and maintenance of thedatabases of an organization

8/4/2019 MIS James A. O'Brian Chap 01

11/531 - 11Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Conceptual Framework of IS Knowledge

8/4/2019 MIS James A. O'Brian Chap 01

12/531 - 12Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Roles of IS in Business

8/4/2019 MIS James A. O'Brian Chap 01

13/531 - 13Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Trends in Information Systems

8/4/2019 MIS James A. O'Brian Chap 01

14/531 - 14Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

What is E-Business?

Definition: The use of Internet technologies to work

and empower business processes,

electronic commerce, and enterprisecollaboration within a company and withits customers, suppliers, and otherbusiness stakeholders.

An online exchange of value.

8/4/2019 MIS James A. O'Brian Chap 01

15/531 - 15Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

E-Business Information TechnologyInfrastructure

8/4/2019 MIS James A. O'Brian Chap 01

16/531 - 16Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Enterprise Collaboration Systems

Definition: Involve the use of software tools to

support communication, coordination, and

collaboration among the members ofnetworked teams and workgroups.

8/4/2019 MIS James A. O'Brian Chap 01

17/531 - 17Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

What is E-Commerce?

Definition:The buying and selling, and marketingand servicing of products, services, and

information over a variety of computernetworks.

8/4/2019 MIS James A. O'Brian Chap 01

18/531 - 18Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Types of Information Systems

8/4/2019 MIS James A. O'Brian Chap 01

19/531 - 19Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Operation Support Systems

Definition: Information systems that process data

generated by and used in business

operations Goal is to efficiently process business

transactions, control industrial processes,

support enterprise communications andcollaboration, and update corporatedatabases

8/4/2019 MIS James A. O'Brian Chap 01

20/531 - 20Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Examples of Operations Support Systems

Transaction Processing Systems (TPS)process data resulting from businesstransactions, update operational databases, andproduce business documents.

Process Control Systems (PCS) monitor andcontrol industrial processes.

Enterprise Collaboration Systems supportteam, workgroup, and enterprisecommunications an collaboration.

8/4/2019 MIS James A. O'Brian Chap 01

21/53

1 - 21Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Management Support Systems

Definition: Information systems that focus on

providing information and support for

effective decision making by managers

8/4/2019 MIS James A. O'Brian Chap 01

22/53

1 - 22Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Management Support Systems

Management Information Systems (MIS)provide information in the form of pre-specifiedreports and displays to support businessdecision making.

Decision Support Systems (DSS) provideinteractive ad hoc support for the decisionmaking processes of managers and otherbusiness professionals.

Executive Information Systems (EIS) providecritical information from MIS, DSS, and othersources tailored to the information needs ofexecutives.

8/4/2019 MIS James A. O'Brian Chap 01

23/53

1 - 23Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Operational & Managerial IS

Expert Systems provide expert advicefor operational chores or managerialdecisions

Knowledge Management Systemssupport the creation, organization, and

dissemination of business knowledge toemployees and managers

8/4/2019 MIS James A. O'Brian Chap 01

24/53

1 - 24Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

IS Classifications by Scope

Functional Business Systems support basicbusiness functions

Strategic Information Systems supportprocesses that provide a firm with strategicproducts, services, and capabilities forcompetitive advantage

Cross-functional Information Systemsintegrated combinations of information systems

8/4/2019 MIS James A. O'Brian Chap 01

25/53

1 - 25Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Management Challenges & Opportunities

8/4/2019 MIS James A. O'Brian Chap 01

26/53

1 - 26Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Measures of Success

Efficiency

Minimize costs

Minimize time

Minimize the use of information resources

Effectiveness

Support an organizations business strategies

Enable its business processes

Enhance its organizational structure and culture

Increase the customer business value of theenterprise

8/4/2019 MIS James A. O'Brian Chap 01

27/53

1 - 27Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Developing IS Solutions

8/4/2019 MIS James A. O'Brian Chap 01

28/53

1 - 28Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Ethical Challenges of IT

8/4/2019 MIS James A. O'Brian Chap 01

29/53

1 - 29Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

IT Career Trends

Rising labor costs have resulting in large-scalemovement to outsource programming functions to India,the Middle East and Asia-Pacific countries.

More new and exciting jobs emerge each day as

organizations continue to expand their wide-scale use ofIT.

Frequent shortages of qualified information systems

personnel.

Constantly changing job requirements due to dynamicdevelopments in business and IT ensure long-term joboutlook in IT remains positive and exciting.

8/4/2019 MIS James A. O'Brian Chap 01

30/53

1 - 30Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

The IS Function represents

A major functional area of businessequally as important to business successas the functions of accounting, finance,operations management, marketing, andhuman resource management.

An important contributor to operationalefficiency, employee productivity andmorale, and customer service andsatisfaction.

8/4/2019 MIS James A. O'Brian Chap 01

31/53

1 - 31Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

The IS Function represents

A major source of information and supportneeded to promote effective decisionmaking by managers and businessprofessionals.

A vital ingredient in developing

competitive products and services thatgive an organization a strategic advantagein global marketplace.

8/4/2019 MIS James A. O'Brian Chap 01

32/53

1 - 32Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

The IS Function represents

A dynamic, rewarding, and challengingcareer opportunity for millions of men andwomen.

A key component of the resources,infrastructure, and capabilities of todays

networked business enterprise.

8/4/2019 MIS James A. O'Brian Chap 01

33/53

1 - 33Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Case #2: Connecting the Mobile Workforce

Goals: Keep 3,500 highly mobile airline pilots:

Trained on the latest technology and

procedures Plugged into the corporate infrastructure

Informed about schedules, weather events,and other facts that affect their jobs

Control costs

8/4/2019 MIS James A. O'Brian Chap 01

34/53

1 - 34Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Case #2: Connecting the Mobile Workforce

Productivity and Efficiency Improvements: Pilots can access updated data electronically.

Pilots can work in a variety of locations includingairplanes, airports, hotels, and other remotelocations.

Pilots appreciate the convenience of not havingto carry heavy manuals and documentation to

multiple locations.

Pilots can take their required training on theirlaptops during downtime in any airport.

8/4/2019 MIS James A. O'Brian Chap 01

35/53

1 - 35Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Case #2: Connecting the Mobile Workforce

1. Are many of Lufthansas challengesidentified in the case similar to thosebeing experienced by other businessesin todays global economy? Explain and

provide some examples.

2. What other tangible and intangible

benefits, beyond those identified byLufthansa, might a mobile workforceenjoy as a result of deploying mobiletechnologies? Explain.

8/4/2019 MIS James A. O'Brian Chap 01

36/53

1 - 36Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Case #2: Connecting the Mobile Workforce

3. Lufthansa was clearly taking a big riskwith their decision to deploy notebookcomputers to their pilots. What steps didthey take to manage that risk and what

others might be needed in todaysbusiness environment? Provide someexamples.

4. How might mobile computing improveyour productivity and efficiency?Provide some examples.

8/4/2019 MIS James A. O'Brian Chap 01

37/53

1 - 37Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Case #2: Connecting the Mobile Workforce

5. What challenges in pilot morale,performance, and management mightarise with the use of mobile computingdevices in the field and in the cockpit?What preventive actions or solutions tothese potential problem areas could yousuggest?

8/4/2019 MIS James A. O'Brian Chap 01

38/53

1 - 38Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

What is a System?

Definition:A group of interrelated components, witha clearly defined boundary, working

together toward a common goal byaccepting inputs and producing outputs inan organized transformation process.

8/4/2019 MIS James A. O'Brian Chap 01

39/53

1 - 39Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

System Components

Input capturing and assemblingelements that enter the system to beprocessed

Processing transformation steps thatconvert input into output

Output transferring elements that havebeen produced by a transformationprocess to their ultimate destination

8/4/2019 MIS James A. O'Brian Chap 01

40/53

1 - 40Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Cybernetic Systems

Definition:a self-monitoring, self-regulating system.

Feedback data about the performanceof a system

Control monitoring and evaluatingfeedback to determine whether a systemis moving toward the achievement of itsgoal

8/4/2019 MIS James A. O'Brian Chap 01

41/53

1 - 41Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Example of a Cybernetic System

8/4/2019 MIS James A. O'Brian Chap 01

42/53

1 - 42Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

A Business System

8/4/2019 MIS James A. O'Brian Chap 01

43/53

1 - 43Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

IS Resources & Activities

8/4/2019 MIS James A. O'Brian Chap 01

44/53

1 - 44Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Information System Resources

People end users and IS specialists

Hardware physical devices andmaterials used in information processingincluding computer systems, peripherals,and media

Software sets of information processinginstructions including system software,application software and procedures

8/4/2019 MIS James A. O'Brian Chap 01

45/53

1 - 45Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Information Systems Resources (cont)

Data facts or observations aboutphysical phenomena or businesstransactions

Network communications media andnetwork infrastructure

8/4/2019 MIS James A. O'Brian Chap 01

46/53

1 - 46Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Data vs. Information

Data raw facts or observations typicallyabout physical phenomena or businesstransactions

Information data that have beenconverted into a meaningful and usefulcontext for specific end users

8/4/2019 MIS James A. O'Brian Chap 01

47/53

1 - 47Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Network Resources

Communications Media examplesinclude twisted-pair wire, coaxial andfiber-optic cables, microwave, cellular,and satellite wireless technologies

Network Infrastructure examples includecommunications processors such as

modems and internetwork processors,and communications control softwaresuch as network operating systems andInternet browser packages.

8/4/2019 MIS James A. O'Brian Chap 01

48/53

1 - 48Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Information Systems Activities

Input of Data Resources Processing of Data into Information

Output of Information Products

Storage of Data Resources Control of System Performance

S

8/4/2019 MIS James A. O'Brian Chap 01

49/53

1 - 49Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Recognizing Information Systems

Fundamental Components of IS People, hardware, software, data and

network resources used

Types of information products produced

Input, processing, output, storage andcontrol activities performed

S

8/4/2019 MIS James A. O'Brian Chap 01

50/53

1 - 50Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Summary

There is no longer a distinction betweenan IT project and a business initiative.

Information systems are an importantcontributor to operational efficiency,employee productivity and morale, andcustomer service and satisfaction.

S

8/4/2019 MIS James A. O'Brian Chap 01

51/53

1 - 51Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Summary

Information systems are a major source ofinformation and support needed topromote effective decision making bymanagers and business professionals.

Information systems can be categorizedbased on their intended purpose.

S

8/4/2019 MIS James A. O'Brian Chap 01

52/53

1 - 52Copyright 2006, The McGraw-Hill Companies, Inc. All rights reserved.

Summary

Managing and using information systemscan pose several challenges including thedevelopment process and ethicalresponsibilities.

8/4/2019 MIS James A. O'Brian Chap 01

53/53

End of Chapter

Chapter

1