Pertemuan I

Foundations of Information Systems in Business

 

Why should you study information systems?

How does a firm use information systems?

What are the components of an information system?

Learning Ovjectives

1.      Understand the concept of a system and how it relates to information systems.

2.      Explain why knowledge of information systems is important for business professionals and identify five areas of information systems knowledge they need.

3.      Give examples to illustrate how the business applications of information systems can support a firm’s business processes, managerial decision making, and strategies for competitive advantage.

4.      Provide examples of several major types of information systems from your experiences with business organizations in the real world.

5.      Identify several challenges that a business manager might face in managing the successful and ethical development and use of information technology in a business.

 

6.      Provide examples of the components of real world information systems.  Illustrate that in an information system, people use hardware, software, data and networks as resources to perform input, processing, output, storage, and control activities that transform data resources into information products.

7.      Become familiar with the myriad of career opportunities in information systems.

Case 1:  Continental Airlines
This Call is Being Monitore

-  CallMiner software installed:

- Records and transcribes conversations

-  Captures keystrokes

-  Used to craft marketing plans

- Improve quality of customer service

-  Determine what training is needed

 

Case Study Questions

1. What are the business benefits of the CallMiner system?

                Provide additional examples beyond those in case.

2. How can new technologies like CallMiner help companies improve their customer service and gain a competitive edge in the marketplace?  Explain.
3. Andre Harris refers to calls to reconfirm a flight as “quite frankly, low-value calls.”  Why are they classified as low value?  Why do you think so many customers are placing such calls?
4.  

Real World Internet Activity

• Many organizations are using call monitoring and data mining to gain a greater understanding of their customers and their needs. Use the Internet to investigate: 
•   Who is using this technology? 
•  In what form? 
•   What is the real value of this technology?

Real World Group Activity

 

• Is call monitoring an invasion of privacy?  In small groups, discuss: 
•  Why do some customers feel their privacy is at stake?
• What do you believe could be done to mitigate privacy concerns while improving the value of the technology?

Why study Information Systems and Information Technology?

•             Vital component of successful businesses

•  Helps businesses expand and compete
• Businesses use IS and IT
• To improve efficiency and effectiveness of business processes
• For managerial decision making 
•  For workgroup collaboration

What is a system? 

                                                                        A system

Is a set of interrelated components

                                         With a clearly defined boundary

                                 Working together to achieve a common set of objectives

What is an Information System?

•  An organized combination of

* People

   * Hardware

                            * Software

* Communications networks

* Data resources

* Policies and procedures

*  That stores, retrieves, transforms, and disseminates information in an organization

Information System (IS) versus Information Technology (IT)

 IS is all the components and resources necessary to deliver information and functions to the organization

- IT is hardware, software, networking and data management

- In theory, IS could be paper based

 - But we will focus on Computer-Based Information Systems (CBIS)

IS Knowledge Framework for Business Professionals

 

What should a Business Professional know about IS?

 

-          Foundation Concepts: fundamental behavioral, technical, business and managerial concepts

-          Information Technology: Hardware, software, networks, data management and Internet-based technology

-          Business Applications: Major uses of the IS in the organization

-          Development Processes:  How to plan, develop and implement IS to meet business opportunities

-          Management Challenges:  The challenges of effectively and ethically managing IT

What does IS do for a business?

 

Business Applications expanding role over time

What is E-business? 

-          The use of Internet technologies

-          To work and empower business processes, electronic commerce, and enterprise collaboration

-          within a company and with its customers, suppliers, and other business stakeholders.

-          An online exchange of value.

How e-business is being used

E-Business Use

-          Reengineer internal business processes

-          Enterprise collaboration systems:  support communications, coordination and collaboration among teams and work groups, e.g., virtual teams

-          Electronic commerce:  buying, selling, marketing and servicing of products and services over computer networks

 

Types Of IS

 

 

 

Operations support systems

What are they?

-          Efficiently process business transactions

-          Control industrial processes

-          Support communications and collaboration

-          Update corporate databases

Types of Operations Support Systems

 

•   ansaction Processing Systems

-          Record and process data from business transactions

-          Examples:  sales processing, inventory systems, accounting systems

•   Process Control Systems

-          Monitor and control physical processes

-          Example:  in a petroleum refinery use sensors to monitor chemical processes

•  Enterprise Collaboration Systems

-          Enhance team and work group communications

-          Examples:  e-mail, videoconferencing

Two ways to process transactions

•   Batch Processing:

-          Accumulate transactions over time and process periodically

-          Example:  a bank processes all checks received in a batch at night

•   Online Processing:

-          Process transactions immediately

-          Example: a bank processes an ATM withdrawal immediately

  

Management Support Systems

•  What are they?

-          Provide information and support for effective decision making by managers

Types of Management Support Systems

 

Management Information Systems (MIS)

-          Provide reports and displays to managers

-          Example:  daily sales analysis reports

Decision Support Systems (DSS)

-          Provide interactive ad hoc support for decision making

-          Example:  A what-if-analysis to determine where to spend advertising dollars

Executive Information Systems (EIS)

-          Provide critical information for executives and managers

-          Example:  easy access to actions of competitors

Operational or Management Systems

Expert Systems

-          Provide expert advice

-          Example:  credit application advisor

Knowledge Management Systems

-          Support creation, organization and dissemination of business knowledge throughout company

Example: Intranet access to best business practices

Classifications of IS by scope

Functional business systems

-          Focus on operational and managerial applications of basic business functions

-          Examples:  support accounting, finance or marketing

Strategic information systems

-          Help get a strategic advantage over its customers

-          Examples:  shipment tracking, e-commerce web systems

Cross-functional information systems

-          Systems that are combinations of several types of information systems

-          Provide support for many functions

 

Challenges and Opportunities of IT

 

Measuring success of an IS

Efficiency

-          Minimize cost, time and use of information resources

Effectiveness

-          Support business strategies

-          Enable business processes

-          Enhance organizational structure and culture

-          Increase the customer and business value

What’s the difference between Efficiency and Effectiveness?

Developing IS Solutions

Ethical challenges of IT applications

 

 

Ethical responsibilities

-          What uses of IT might be considered improper or harmful to other individuals or society?

-          What is the proper business use of the Internet or a company’s IT resources?

-          How can you protect yourself from computer crime?

IT Careers

 

-          Outsourcing of basic programming to India, the Middle-East and Asia-Pacific countries

-          Strong employment opportunities in other areas in IS

-          Shortage of qualified IS personnel

-          Long-term job outlook positive and exciting

Career Opportunities in IS

  

 

Job growth

  

Among the fastest growing occupations through 2012

-          Systems Analyst,

-          Database administrators,

-          Other managerial-level positions

-          Network specialists

-          Information security

Case Study Questions

1. Why do you think that Aviall failed in their implementation of an airplane parts and components inventory control system?
2. How ahs information technology brought new business success to Aviall?  How did IT change Aviall’s business model?
3. How could other companies use Aviall’s approach to the use of IT to improve their business success?  Give several examples.

Real World Internet Activity

1. Go to the Aviall’s website at www.aviall.com and look through some of the case studies of business solutions that Aviall provides to its customers.

-          See if you can find evidence of successes directly related to the new system.

2.      Sometimes, big failures can become big successes when working with innovative applications of technology.  In small groups,

-          Discuss your thoughts as to why it seems a failure has to happen first.

-          Is it because we don’t hear about the successes unless they come from a failure?

-          How can we learn from the failures in applying innovative technologies so that more successes can be realized?