Chapter 1
Foundations of Information Systems in Business
Section 1 Foundation Concepts: Information Systems in Business
I. The Real World of Information Systems
Information Systems are an essential field in the study of business administration and management.
IS and IT and Internet technologies play vital roles in business and improve the effectiveness and efficiency of business processes, managerial decision making, and workgroup collaboration.
What is an Information System? An IS may be computerized or not
Smoke signals for communication
Card catalogs in a library
Your book bag, day planner, notebooks, and file folders
The cash register at your favorite fast-food restaurant
A paper-based accounting ledger
Framework of major areas:
Foundation Concepts – fundamental behavioral, technical, business, and managerial concepts about information systems
Information Technologies – major concepts, developments, and management issues in IT
Business Applications – major uses of IS for operations, management, and competitive advantage
Development Process – how an IS is planned, developed, and implemented to meet business opportunities
Management Challenges – effectively and ethically managing IT at the enduser, enterprise, and global levels of a business
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II. The Fundamental Roles of IS in Business
Support of Strategies for Competitive Advantage
Support of Business Decision Making
Support of Business Processes and Operations
III. Trends in Information Systems
1960’s
Electronic Data Processing (EDP) Management Information Systems (MIS) 1970’s Decision Support Systems (DSS)
1980’s
End User Computing Executive Information Systems (EIS) Enterprise Resource Planning (ERP) 1990’s The Internet Intranets and extranets Global networks 2000’s
Business Intelligence (BI) – all applications and technologies focused on gathering and analyzing data/information for strategic business decisions
Internet-based/Web-enabled enterprises – dramatically changed the capabilities of IS in business
Global e-business and e-commerce – now commonplace
IS is now solidly entrenched as a strategic resource in the modern organization
IV. The Role of e-Business in Business
E-Business – use of Internet technologies to empower business processes, ecommerce, and enterprise collaboration within a firm and its customers, suppliers, and stakeholders
Enterprise Collaboration Systems – support communication, coordination, and collaboration among networked teams/workgroups
E-Commerce – buying, selling, marketing, and servicing products, services, and information over computer networks
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V. Types of Information Systems
Operation Support Systems – help run the daily business, but do not provide much information for managerial decision-making
Transaction Processing Systems – record & process daily transactions
Process Control Systems - monitor and control physical processes
Enterprise Collaboration Systems (Office Automation Systems) – enhance team and workgroup communications and productivity
Management Support Systems
Management Information Systems – reports and displays for managers to help them make better business decisions
Decision Support Systems – direct computer support for decision-making
Executive Information Systems – critical information specifically for executives to make better decisions; not just a better MIS
Other Categories of Information Systems
Expert Systems – expert advice for operational decisions
Knowledge Management Systems – support creation, organization, and dissemination of business knowledge
Strategic Information Systems – apply IT to products, services, and processes for strategic advantage
Functional Business Systems – support basic business functions
Cross-Functional Systems – integrate various roles and outputs into a variety of functions
V. Types of Information Systems
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VI. Managerial Challenges of Information Technology
Challenges and Opportunities
Business/IT Challenges Business/IT Developments Business/IT Goals Success and Failure with IT
Effectiveness – does it work? Efficiency – how well does it work?
Developing IS Solutions – an Information Systems is a Solution to a Business Problem
Investigate (Plan) – recognize the problem exists
Analyze – investigate the current system
Design – designing the new system
Implement – put the new system into effect
Maintain (Use) – use, monitor, and maintain the new system
Challenges and Ethics of IT – what is improper, irresponsible, or harmful?
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Challenges of IS and IT Careers – in business, if you are not in an IT career, you will work regularly with IS professionals
Employment opportunities in IS are strong
Business Technologist – a professional competent in both business and IT
U.S. Department of Labor – IS positions expected to be among fastest growing for years to come
The IS Function
IS is a major functional area of business, just as important as any business function IS is an important contributor to operational efficiency, employee productivity and morale, and customer services and satisfaction IS is an important strategic resource
Section 2 Foundation Concepts: The Components of Information Systems I. System Concepts: The Foundation for Business Processes
What Is a System? Input – capture the data to be processed Processing – change the data into information Output – disseminate the information product to its destination Feedback and Control Feedback – data about the performance of the system Control – monitoring the feedback to determine if the system is meeting its objectives
Other System Characteristics
Environment and Subsystems Interface – a shared boundary between systems Open (and Closed) Systems – open systems interact with other systems (closed systems do not interact with other systems) Adaptive Systems – have the ability to change themselves or their environment
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III. Information System Resources
People Resources IS Specialists End Users
Hardware Resources Machines – the computing devices themselves Media – where data is stored
Software Resources Programs – instructions that tell the computer what to do System Software – runs the computer Application Software – a particular use by end users Procedures – instructions on how to use the system
Data Resources Data – unorganized facts and figures Information – data organized so that it has value to the organization
Network Resources Communications Media- the physical pathways over which signals travel Network Infrastructure – hardware, software, and data technologies needed to support communications networks
IV. Information System Activities
Input of Data Resources Processing of Data into Information – organize, analyze, and manipulate data Output of Information Products – dissemination of information products to appropriate end users Storage of Data Resources Control of System Resources – monitoring feedback to assure the system meets its performance standards
V. Recognizing Information Systems
People, Hardware, Software, Data, and Network Resources Types of Information Products Used Performance of Input, Processing, Output, Storage and Control Activities