Information Systems
in Business:
Organizations,
Management and
Networked Enterprise
Term: 2009/2010
Week 2
ITU Management Faculty
Management Information Systems
N. YILDIRIM
Index – Information Systems in
Business: Organizations, Management
and the Networked Enterprise (1)
INTRODUCTION TO INFORMATION SYSTEMS
1.
2.
3.
4.
5.
6.
Terminology for Information
Data
Valuable Information
Information System
Manegement Information Systems
Role of Information Systems in Change
MANAGEMENT INFORMATION SYSTEMS
1.
I) Information Systems in (Global) Business Today
1.
2.
3.
Dimensions of and Influences on information systems
Content of Information Systems
Interrelations between BIS and Organisation
How Businesses Use Information Systems
1.
1.
2.
Digital Economy, Digital Business and Business Models
Strategic business objectives of Information systems
Information Systems in Organizations and Strategy Making
2.
1.
2.
IS Classifications by Functions and Organizational Structures of the Enterprise
Terminology for Information Systems
Information Systems in Social Concept
3.
1.
2.
3.
Contemporary Approaches
Information Society
Trends
ITU Management Faculty – MIS
Working with Systems
 Systems development

The activity of creating or modifying an existing business
system
 Systems investigation and analysis

Defines the problems and opportunities of an existing
system
 Systems design

Determine how a new system will work to meet business
needs
 Systems implementation

Creating and acquiring system components defined in the
design
 Systems maintenance and review

Checks and modifies the system so that it continues to
meet changing business needs
ITU Management Faculty – MIS
System Development Loop
Systems
development
Systems
design
FINDING THE SOLUTION : Designing/Defining the
“needed/required” system– Specifications, “How it
should be?”
Systems
implementation
Documentation
Training
Structural Change
(+Revision)
Corrective Actions
Preventive Actions
DEFINING THE PROBLEM : Understanding the
current system or need for the system –
Requirements List, “Contract”, What is the Gap?
Revisions
Modifications
Systems
analysis
IMPLEMENTING THE SOLUTION :
Building, Project, Hands-on work,
“Closing the Gap”
PERFORMANCE
Systems
EVALUATION : Control,
Review And Audit Check, “Measuring the
Gap”
ITU Management Faculty – MIS
Systems
maintenance
and improvement
System Development Project
ITU Management Faculty – MIS
Terminology

Data




Information





Information that has been organized and processed to convey understanding,
experience and expertise as they apply to a current problem or activity
An awareness and understanding of a set of information and how that information
can be made useful to support a specific task
concepts, experience, and insight that provide a framework for creating,
evaluating, and using information.
Knowledge base


Data that has been, processed, organized and shaped so that they have meaning,
use and value to the recipient
A collection of facts organized in such a way that they have additional value
beyond the value of the facts themselves
Knowledge


Streams of raw facts
Distinct pieces of information, usually formatted in a special way
Elementary description of things, events, activities, and transactions that are
recorded, classified, and stored, but not organized to convey any specific meeting
The collection of data, rules, procedures, and relationships that must be followed
to achieve value or the proper outcome
Wisdom

the collective and individual experience of applying knowledge to the solution of
problems.
ITU Management Faculty – MIS
System Development Project
PROBLEM
Measurement
Data
Processing
Information
Analysis
Knowledge
Decision
Action
First Outcomes
Follow up
ITU Management Faculty – MIS
System Development Project
Population
Census of
Population
Each citizen
Computing
Population
Calculation of
Population Growth
Comparing with
objectives
High Population
Growth
Pop.Planning
Public Training
Minor Decrease in Pop.
Population Records
Nr. Of new TC Ids
ITU Management Faculty – MIS
Terminology

Process
A
set of logically related tasks performed to
achieve a defined outcome

Process
 (n)
An executing program. The term is used
loosely as a synonym of task.
 (v) To perform some useful operations on
data.
ITU Management Faculty – MIS
Information Technology
Definition:
 the hardware and software a business
uses to achieve its objectives.
 any machine technology that is controlled
by or uses information for operation
Example: a programmable industrial robot
receiving instructions from a computerbased database
ITU Management Faculty – MIS
Information Systems Components:
Data
Data
People
Information
Systems
Telecommunications
Hardware
Software
• The raw inputs for entry into information systems
• Organized, processed and stored by an IS to
support user information needs
• Provides basis for qualitative/quantitative analysis
ITU Management Faculty – MIS
“Data” as an Information
System Component
(1) Distinct pieces of information, usually formatted in a
special way. All software is divided into two general
categories: data and programs. Programs are collections of
instructions for manipulating data.
Data can exist in a variety of forms -- as numbers or text
on pieces of paper, as bits and bytes stored in electronic
memory, or as facts stored in a person's mind.
Data is the plural of datum, a single piece of information.
In practice, however, people use data as both the singular
and plural form of the word.
ITU Management Faculty – MIS
“Data” as an Information
System Component
(2) The term data is often used to distinguish binary
machine-readable information from textual human-readable
information.
Some applications make a distinction between data files
(files that contain binary data) and text files (files that contain
ASCII data).
(3) In database management systems, data files are the
files that store the database information, whereas other files,
such as index files and data dictionaries, store administrative
information, known as metadata.
ITU Management Faculty – MIS
Types of Data
Data
Represented by
Alphanumeric data
Numbers, letters, and other characters
Image data
Graphic images or pictures
Audio data
Sound, noise, tones
Video data
Moving images or pictures
ITU Management Faculty – MIS
Data  Information
Data
Transformation
Information
Processed Shaped
meaningful data
Raw Facts
ITU Management Faculty – MIS
Characteristics of
Valuable Information
 Characteristics
 Accurate
 Complete
 Economical
 Flexible
 Reliable
 Relevant
 Simple
 Timely
 Verifiable
 Accessible
 Secure
ITU Management Faculty – MIS
Information System –
Definition and Purpose
 An information system consists of components that support
decision making and control, and help with analysis,
visualization, and product creation.
 An information system (IS) collects, processes, stores,
analyzes, and disseminates information for a specific
purpose “Application”.
 Or Collects data, processes it into information then converts
information into knowledge for a specific purpose.
 A set of interrelated elements or components that collect
(input), manipulate (process), and disseminate (output) data
and information and provide a feedback mechanism to meet
an objective.
ITU Management Faculty – MIS
Information Systems
Procedures
- A combination of technical components
- Built and used by people to collect, create, and
distribute useful data
- Used typically in organizational settings but are evolving
for personal use
ITU Management Faculty – MIS
What is an Information System?
 An information system (IS) collects, processes, stores, analyzes,
and disseminates information for a specific purpose.
 Like any other system, an information system includes inputs (data,
instructions) and outputs (reports, calculations). It processes the
inputs by using Information technology and produces outputs that
are sent to users or to other systems via electronic networks and a
feedback mechanism that controls the operation.
Feedback
Input
Processing
Model of an information system
ITU Management Faculty – MIS
Output
Information System Is A System
ITU Management Faculty – MIS
Input, Processing, Output,
 Input


The activity of gathering and capturing data
Whatever goes into the computer
 Processing

Converting or transforming data into useful outputs
 Output


Useful information, usually in the form of
documents and/or reports
Anything that comes out of a computer
ITU Management Faculty – MIS
Input
(n) Whatever goes into the computer. Input
can take a variety of forms, from
commands you enter on a keyboard to
data from another computer or device. A
device that feeds data into a computer,
such as a keyboard or mouse, is called
an input device.
(v) The act of entering data into a computer
ITU Management Faculty – MIS
Output
(n) Anything that comes out of a computer. Output
can be meaningful information or gibberish, and
it can appear in a variety of forms -- as binary
numbers, as characters, as pictures, and as
printed pages. Output devices include display
screens, loudspeakers, and printers.
(v) To give out. For example, display screens
output images, printers output print, and
loudspeakers output sounds.
ITU Management Faculty – MIS
Feedback
 Feedback

Output that is used to make changes to
input or processing activities
 Feedforward


A proactive approach to feedback
Use for estimating future sales or inventory
needs
ITU Management Faculty – MIS
Data  Information
Data
Raw
Facts
331 Coca Cola 1lt 1,45
521 Lipton Ice Tea 1lt 1,20
332 Rodeo Bar 40gr 0,40
185 Vernel 3lt 5,25
Transformation
Information
System
Information
Sales Region: Atasehir
Store : BIM
Item No Description Units Sold
331
Coca Cola 1lt
1
Raw data from a supermarket checkout counter can be processed and
organized to produce meaningful information, such as the total unit sales of
Coke or the total sales revenue from Coke for a specific store or sales
territory.
ITU Management Faculty – MIS
Processed
Shaped
meaningful
data
Management Information Systems

MIS is an organized collection of ;
People,
Processes,

Hardware - Devices

Software,

Databases,
That are used to provide “information” to decision makers in all levels.



The vast majority of information systems are developed for and used by people in
functional areas (e.g., manufacturing, human resources, accounting, finance and
marketing).

To develop information systems that address the needs of the organization, MIS
professionals must possess a solid mix of business and technical knowledge. They
must understand;




*
organizational structures,
objectives,
operations (including processes and the flows of data between processes)
and the financial implications related to these factors.
MIS managers and professionals must stay up-to-date with evolving information
technologies and have a solid foundation of technical skills to select appropriate
technologies and to implement computer-based information systems.
ITU Management Faculty – MIS
Information Systems:
Turn Data into Information
Suppliers
Customers
ENVIRONMENT
ORGANIZATION
Data
Information
FEEDBACK
Stockholders
Competitors
• Raw material
• Unformatted information
• Generally has no context
Classify
Arrange
Calculate
• Processed material
• Formatted information
• Data given context
ITU Management Faculty – MIS
Dimensions of information
systems
 Organizations
– The key elements of an organization are its:





People
Structure
Business processes
Politics
Culture
 􀂃 Management
 􀂃 Technology


It isn’t just a technology: A Business perspective on
information systems
Complementary assets: Organizational capital and the
right business
ITU Management Faculty – MIS
Computer Based Information System
 Hardware
 Software
Hardware
 Data/Bases
 Network/Telecom
 Procedures
Software
Application
Data
People
 People
More than hardware and software
Together they are configured to collect, manipulate, store, and process
data into information
ITU Management Faculty – MIS
Influences on Information System
 IS on the core – Building the Links
Using information systems effectively
requires an understanding of the
organization, management, and
information technology shaping the
systems.
An information system creates VALUE
for the firm as an organizational and
management solution to challenges
posed by the environment.
ITU Management Faculty – MIS
Influences on Information System
 IS on the core – Building the Links
ITU Management Faculty – MIS
Content of Information System
 Widening Scope and Evolution of Information
Systems
There is a growing interdependence between a firm’s information systems and its
business capabilities.
 Changes in strategy, rules, and business processes increasingly require changes in
hardware, software, databases, and telecommunications. Often, what the organization
would like to do depends on what its systems will permit it to do.

ITU Management Faculty – MIS
Content of Information
Systems
 A Business Perspective on Information
Systems – The business Information Value
Chain
Business Processes
Supply Chain
Management
Enterprise
Management
Customer
Management
Knowledge
Management
Firm
Profitability
And
Strategic
Position
Dissemination
Data
Transformation
Collection Into Business
and Storage
Systems
Planning
Modelling and
Decision Making
Management Activities
Coordinating
Information Processing Activities
Business Value
ITU Management Faculty – MIS
Controlling
Content of Information Systems –
Extended Enterprise
 As IT continue to deploy multiple complex, mobile and
distributed systems, the processing and managing of
information in enterprises becomes costly and complicated.
ITU Management Faculty – MIS
Business Information Systems
 The interactive relationships between the information
systems and organizations, both technically and socially,
and the business opportunities and challenges brought
about by the BIS.
 This describes information systems used to support the
functional areas of business.
“ Since the advent of the mainframe in the 1950s,
companies have dreamed of “using computers to
manage their businesses”.
But early efforts came up short, with technology that
was too costly or too clunky.
Now, thanks to the Net and dashboards, those
dreams are starting to come true. Forrester Research
Inc. estimates that 40% of the 2,000 largest
companies use the technology.”
ITU Management Faculty – MIS
Interrelations between BIS and
Organisation
Impact of Information Systems on
Organizations

Economic impacts

Organizational and behavioral
impacts



Mediating Factors
Environment
Culture
Structure
Business Processes
Politics
MANAGEMENT DECISIONS
IT flattens organizations
Postindustrial organizations
Understanding organizational
resistance to change

The Internet and organizations

Implications for the design and
understanding of information systems
This complex two-way relationship is
mediated by many factors.
ITU Management Faculty – MIS
Interrelations between BIS and
Organisation
INTERDEPENDENCE
HARDWARE
BUSINESS
SOFTWARE
DATABASE
Strategy
TELECOMMUNICATIONS
Rules
Procedures
ORGANIZATION
INFORMATION SYSTEM
ITU Management Faculty – MIS
Digital Economy – “New” Economy
 E-Business: The use of electronic
technologies to transact business.
 Collaboration: People and Organizations
interact, communicate, collaborate and
search for information
 Information Exchange: Storing,
processing and transmission of
information.
ITU Management Faculty – MIS
Digital Business
Telecommunications
Networks
T h in C lien t
PC
E- Co m m e r ce Se r v e r
O n-line
Single-station Store
Ap p lian ce
STA R S
B u si n e ss t o B u si n e ss
Linux SSL
Li n u x
Sybase ASE Database
O f f i ce Su i t e
Se r v e r
V i d e o Co n f e r e n ci n g
Se r v e r
Ap p lian ce
SC O Unix
Unix
T arentella
S erver
N et
S tore 3
Ap p lian ce
C o ld Fusio n
W in d ow s 2 0 0 0
Beaco n Hill's Stars
S tore 1
Apache Serv er
O n-line M ulti-station Store
Linux
C redit C ard Appro v al
I P A d d r e ss 2
Apache Serv er
I P A d d r e ss 3
Field Sales
I P A d d r e ss 1
O n-line
Salesperson
PO S
Yo u r D o m a i n / U R L
Co mmercial
In t er n et
Internet
Hub
PC
E-co mmerce
In-house operations
O n-line Custom ers
Consumer
Consum er & B usiness
PC
STA RS
A cco unt ing
Pho ne O rd ers
M ail O rd ers
O rd er Fulf illment
Purchasing
In-office
T h in C lien t
T h in C lien t
ITU Management Faculty – MIS
PC
The Old Economy – Taking Photo’s
1.
2.
3.
4.
5.
6.
7.
Buy film in a store
Load your camera
Take pictures
Take roll of film to store for processing
Pickup the film when ready
Select specific photos for enlargement
Mail to family and friends
ITU Management Faculty – MIS
The New Economy – Taking Photo’s

1st Generation Digital Photography


2nd Generation Digital Photography


Old economy except 6 and 7 were replaced by
using a scanner and emailing
Use a Digital Camera, no film, no processing.
3rd Generation Digital Photography

Your Digital Camera is now your mobile phone, in
your binoculars or a palmtop computer.
ITU Management Faculty – MIS
Business Models
 A business model is a method of doing business by
which a company can generate revenue to sustain itself.
The model spells out how the company adds value to
create a product or service. (Value Chain)



Nokia makes and sells cell phones
A TV station provides free broadcasting. Its survival depends on
a complex model involving advertisers and content providers.
Internet portals, such as Yahoo, also use a complex business
model.
ITU Management Faculty – MIS
Digital Age Business Models
 Name-Your-Own Price
 Reverse Auctions
 Affiliate Marketing
 E-Marketplaces and Exchanges
 Electronic aggregation (buying groups)
ITU Management Faculty – MIS
Drivers Forcing Changes In Business
Models
Business Pressures
 Environmental, organizational, and technological factors are
creating a highly competitive business environment these
factors or forces can change quickly, sometimes in an
unpredictable manner.
Business Critical Response Activities
 Therefore, companies need to react frequently and quickly
to both the threats and the opportunities resulting from this
new business environment. A response can be a reaction to
a pressure already in existence, an initiative intended to
defend an organization against future pressures, or an
activity that exploits an opportunity created by changing
conditions.
ITU Management Faculty – MIS
Business Pressures on an
Organization that force change.
ITU Management Faculty – MIS
IT – enabled Organizational Responses
to Business Pressures
 Strategic Management & Systems
 Continuous Improvement –





Operational Efficiency
Restructuring business processes
Manufacturer to order, MassCustomization
Customer Focus Strategy
Electronic business
Business Alliances
ITU Management Faculty – MIS
Strategic business objectives of
information systems
Operational excellence: Achieve operational excellence
through higher levels of efficiency and productivity
New products, services, and business models: Create new
products, services, and business models
 Customer and supplier intimacy: Raise revenue and profits
while lowering costs by increasing customer and supplier
intimacy
Improved decision making: Improve decision making for
managers and employees
 Competitive advantage: Increase competitive advantages
 Survival: Insure survival caused by business environment
changes
ITU Management Faculty – MIS
Strategic business objectives
of information systems
Operational excellence:
Achieve operational excellence through higher levels of
efficiency and productivity
 Improved efficiency results in higher profitability
 Information systems and technologies help to improve higher
levels of efficiency and productivity
Case Study: Wal-Mart
 the champion of combining information systems and best
business practices to achieve operational efficiency—and $285
billion in sales in 2005
 the most efficient store in the world as a result of digital links
between its suppliers and stores
ITU Management Faculty – MIS
Strategic business objectives
of information systems
Operational excellence: Case Study: Wal-Mart
 It is all-purpose chain store all around America. They sell many
products such as: electronics, movies, music, books, toys, jewelry,
sporting goods, home appliances, garden and patio accessories, video
games, apparel, gifts, pharmacy, and home craft/furniture.
 uses on time shipments. They don’t keep high inventory in their
back rooms, saving on storage. When inventory in the store starts
running out, the system notifies them to order more stock. Another
business process that they use is sales.
 They save money with their inventory, faster customer service,
using self check, and eliminating baggers saves on labor cost.
Technology also helps the cashiering with better computer systems
there will be fewer errors.
The Information Systems Division (ISD) supports the
world’s largest non-governmental database
ITU Management Faculty – MIS
Strategic business objectives of
information systems
 New products, services, and business models:
Create new products, services, and business models
 Information systems and technologies enable firms to create
new products, services, and business models
 A business model includes how a company produces, delivers,
and sells its products and services
Case Studies:
 The music industry has seen drastic changes in business
models in recent years
 Apple has been very successful at introducing new products and
adopting a new business model
ITU Management Faculty – MIS
Strategic business objectives
of information systems
 New products, services, and business models:
Case Study - Apple:
Apple has been very successful at introducing new
products and adopting a new business model : Strong
presence of networks. Launched its online store on 2003.
 Apple created virtual supply chains that span several
continents and numerous countries with almost instantly
replenishable and inexhaustable inventory with very little
scaling costs. It has further integrated the processes so that
there is a seamless transaction between the end user and
the provider (Apple) of the content, by Apple providing the
hardware to use the content as well as the content itself.
Apple has managed to establish a network with all the
major industry players to ensure a smoothly functioning
supply chain for its digital content.
ITU Management Faculty – MIS
Strategic business objectives
of information systems
 Customer and supplier intimacy:
Raise revenue and profits while lowering costs by increasing
customer and supplier intimacy
 Customers who are served well become repeat customers who
purchase more
 Close relationships with suppliers result in lower costs
Case Studies:
 The Mandarin Oriental in Manhattan uses information systems
and technologies to foster an intimate relationship with its
customers including keeping track of their preferences
 JCPenney uses information systems to enhance its relationship
with its supplier in Hong Kong
ITU Management Faculty – MIS
Strategic business objectives
of information systems
 Customer and supplier intimacy- Case Study: The
Mandarin Oriental in Manhattan
deployed Hotel Service Optimization System (HotSOS") to automate
workflow and communications, wirelessly connect service staff to each other,
guests, groups and meeting planners for unmatched personalized, prompt
service. HotSOS is helping the hotel keep everyone "in the loop" in real time
so service levels consistently can exceed the expectations of guests.
“ Before HotSOS, when our occupancies were high, say 90-percent-plus, it
would take us more than six minutes to respond to a guest request and
deliver on their needs. With HotSOS, a bellman or front desk staff, can
instantly easily submit a service request to a department and all related
managers based on customized business rules, and within minutes we have
the guest request and notify all in the loop. Number of requests taking more
than six minutes to fulfill has dropped 75%. This means more-loyal
customers, more of their precious repeat business and referrals."
Reading : www.hillside.com.tr
ITU Management Faculty – MIS
Strategic business objectives
of information systems
 Improved decision making:
Improve decision making for managers and employees
 A company’s bottom line can be hurt by managers being
swamped with data that are neither timely nor helpful, forcing them
to use guesswork
 Real-time data have improved the ability of managers to make
decisions
Case Studies:
 Verizon uses a Web-based digital dashboard to update
managers with real-time data on customer complaints, network
performance, and line outages
ITU Management Faculty – MIS
Strategic business objectives
of information systems
 Improved decision making: Case Study- Verizon
 one of the world’s leading providers of communications services. Verizon’s
domestic wireline telecommunications business provides local telephone
services, including broadband, in 28 states and nationwide long-distance and
other communications products and services. Verizon Wireless, provides
wireless voice and data products and services across USA. Information
Services operates directory publishing and electronic commerce services.
 Uses a digital dashboard corporate intranet that gives employees up-to-theminute data on company performance. It also offers a Web-based service
allowing customers to decide which calls are routed to specific phones.
Reading: http://www.businessweek.com/magazine/content/06_07/b3971083.htm
"The dashboard puts me and more and more of our
executives in real-time touch with the business. The
more eyes that see the results we're obtaining every day,
the higher the quality of the decisions we can make." Ivan
Seidenberg _ Verizon CEO
ITU Management Faculty – MIS
Strategic business objectives of
information systems
Competitive advantage:
Increase competitive advantages
 Achieving the previously mentioned business objectives often
leads to competitive advantage
 Advantages over competitors include charging less for superior
products, better performance, and better response to suppliers and
customers
Case Studies:
 Dell Computer is one of the best examples of establishing
competitive advantage as the company has continued to be
profitable during a time when PC prices have been falling steadily
ITU Management Faculty – MIS
Strategic business objectives of
information systems
 Survival:
Insure survival caused by business environment changes
 Businesses may need to invest in information systems out of
necessity
 Necessity arises from keeping up with competitors- necessity
also arises from federal and state regulations
Case Studies:
Citibank introduced ATMs- the Toxic Substances Control Act and
the Sarbanes-Oxley Act
ITU Management Faculty – MIS
Strategic business objectives of
information systems
TOYOTA CASE
Problem: Tough competition and demanding customers.
Solutions:
• Redesigned order and production processes reduce costs, increase
revenue, and improve customer service.
•E-Business software makes it possible to build cars to order and
forecast demand and production requirements more accurately.
• Demonstrates IT’s role in analyzing market trends and monitoring
quality, efficiency, and costs.
• Illustrates the emerging digital firm landscape where
businesses can use tools to analyze critical data.
ITU Management Faculty – MIS
Strategic business objectives
of information systems
 TOYOTA CASE
Reading: An Evaluation of Toyota Motor Company (TMC) Information Systems,
Ryan Morris
ITU Management Faculty – MIS
Strategic business objectives
of information systems
 TOYOTA CASE
ITU Management Faculty – MIS
Information Technology Capital
Investment
50%
34%
Between 1980 and 2004
IT investment (hardware inv.+ software inv.+ communications
equipment inv.) grew from 34% to 50% in U.S.A.
In 2008 ---------- (Explore ! And Analyze!)
ITU Management Faculty – MIS
Source: Based on data in U.S. Department of Commerce, Bureau of Economic Analysis, National Income and Product Accounts, 2006.
The emerging digital firm
ELECTRONIC COMMERCE- ELECTRONIC BUSINESS -ELECTRONIC MARKET
An organization where nearly all significant business processes and
relationships with
- customers,
- suppliers,
- employees are enabled and key corporate assets are managed digitally.
• Information system links all parties to exchange information, products,
services, payments
• Core business processes are accomplished through digital networks and
span the entire organization or link multiple organizations.
• Key corporate assets — intellectual property, core competencies, and
financial and human assets — are managed through digital means.
• Internal and external environments are quickly recognized and dealt with.
• Information technology is the “core of the business” and “the primary
management tool”.
ITU Management Faculty – MIS
Information System – Classification
By Organizational Structure
An information system (IS)
can span departments,
business units and
corporations.
PC
PC
U n ix
E n te rp rise
S e rve r
PC
Hub
S e ria l T e rm in a ls
In -h o u se o p e ra tio n s
 Departmental IS
T h in
C lie n t
Mux
 Enterprise-Wide IS
T h in
C lie n t
 Inter-Organizational IS
D IA L U P /T 1 /T 3 /IS D N /F R A M E R E L A Y
D IA L U P /T 1 /T 3 /IS D N /F R A M E R E L A Y
Mux
T h in C lie n t
PC
Mux
Information systems are
usually connected by means
of electronic networks
T h in C lie n t
PC
A p p lia n c e
U n ix
E n te rp rise
S e rve r
A p p lia n c e
S e rve r
S to re 3
A p p lia n c e
A p p lia n c e
S e rve r
S to re 3
O n -lin e M u lti-sta tio n S to re
St ore Locat i on 1
O n -lin e M u lti-sta tio n S to re
St ore Locat i on 2
ITU Management Faculty – MIS
O nli ne T elenet Syst em usi ng t he Int ernet
Information System
Classification By Organizational
Structure
The various types of systems in the
organization have
interdependencies.
TPS are major producers of
information that is required by many
other systems in the firm, which, in
turn, produce information for other
systems. These different types of
systems are loosely coupled in most
business firms, but increasingly
firms are using new technologies to
integrate information that resides in
many different systems.
ITU Management Faculty – MIS
BUSINESS
INTELLIGENCE
Information System - Classification
By Function (Department)
An information system (IS) support each department in
a corporation.





Operations
Accounting
Finance
Marketing
Human resources
Transaction Processing Systems (TPS): Automates
routine and repetitive tasks that are critical to the
operation of the organization
ITU Management Faculty – MIS
Information System - Classification
By Function (Department)
An information system (IS) support each department in
a corporation.
ITU Management Faculty – MIS
Information System - Classification
By Functional Perspectives
Sales
Purchasing
•
•
•
•
Which vendors
Quantity to purchase
Coop, rebate tracking
Handle delivery
discrepancies
• Generate the
purchase order
Finance
• Financial Assets
• Investment
management
• Banking
• Long term budgets
•
•
•
•
•
Contact customers
Sell the product
Take the order
Follow-up on the sale
5 year sales forecast
Manufacturing
• Control Equipment and machinery
• Design new products
• When and quantity of products to
produce
• New production facilities
• Generate the work order
Accounting
•
•
•
•
•
Accounts Receivable
Disbursements
Payroll
Depreciation
Earned Coop and
Rebates
ITU Management Faculty – MIS
Marketing
• Identify customers
• Determine what they
want
• Planning products
• Advertising and
promoting products
• Determine prices for
products
Human Resources
• Employee wages,
salaries & benefits
• Long term labor
requirements
• Tracking vacation,
sick,
• Track employee skills
• Interview and review
employees
Information System -
Business Intelligence
Classification By Support Function
S e n io r M g r
Executive Support System
•5-year sales trend
•Profit Planning
•5-year budget forecasting
•Product development
Strategic Level
Management Information System
M id d le M a n a g e rs
Decision Support System
Management Level
Intelligent Support Systems
Knowledge Management System D a ta W o rk e rs
Office Automation System
Knowledge Level
O p e ra tio n a l M a n a g e rs
Transaction Processing System
Workers
Operational Level
ITU Management Faculty – MIS
•Sales Management
•Inventory Control
•Annual budget
•Production Scheduling
•Cost Analysis
•Pricing Analysis
•Simulation
•Pgm coding
•System support
•Word Processing
•Desktop Publishing
•Order Processing
•Fulfillment
•Material Movement
•A/R, A/P, GL
•Payroll
•POS
Information System - Classification
By Function (Department)
An information system (IS) support each department in
a corporation.





Operations
Accounting
Finance
Marketing
Human resources
Transaction Processing Systems (TPS): Automates
routine and repetitive tasks that are critical to the
operation of the organization
ITU Management Faculty – MIS
From Information Technology
to Information Systems
ITU Management Faculty – MIS
Contemporary Approaches to
Information Systems
ITU Management Faculty – MIS
Contemporary Approaches to
Information Systems
 Sociotechnical systems

Information systems and the use of technology
belong to everyone in an organization.

This concept is best carried out through a
sociotechnical approach to viewing information
systems, which allows both the technical and
behavioral approaches to be combined for the
good of the organization.
ITU Management Faculty – MIS
Information Society Evolution:
Terms and Issues
Information Society
1960
2000
Knowledge Society (Drucker - 1959)
• Term invented to describe the next evolution of society
• This evolution would be a result of the rise in the numbers
and importance of knowledge workers in society
• Education was described as the cornerstone of the
knowledge society as it is core to the knowledge worker
• Drucker was right again!
ITU Management Faculty – MIS
IS Role in Change: Trends and Terms
Downsizing (Sometimes called Rightsizing)
• Reducing organizational headcount to meet the
financial goals of the organization
• IT is viewed as the lever to provide the systems
necessary to increase productivity
Outsourcing
• Transferring business functions outside the organization
to increase service levels and/or reduce operating cost
• IT is not immune to this trend. Certain commodity IT
technical jobs will be increasingly transferred overseas
• IT must find better methods to manage offshore work
ITU Management Faculty – MIS
Information Society Evolution:
Periods of Change
Agricultural
(Prior to 1890’s)
Industrial
Informational
(1890’s to 1960’s) (1960’s to Present)
ITU Management Faculty – MIS
Information Society Evolution:
Terms and Issues
Information Society
1960
2000
Knowledge Worker (Peter Drucker 1959)
• A term invented to describe a future trend in the workforce
• These will be professionals that create, modify and/or
synthesize information as a fundamental part of their job
• They will require higher education levels and received higher
compensation than workers in agriculture or manufacturing
• The term is still generally accepted today (Drucker was right!)
ITU Management Faculty – MIS
Information Society Evolution:
Terms and Issues
Information Society
1960
2000
New Economy (Wired Magazine - Late 1990s)
• Similar to “knowledge society” but more descriptive
• Describes a society where people use their brains more
than their hands in their work and personal lives
• Where communications technology and other IT systems
will create global competition for all products and services
• Other names: Digital Economy, Network Era, Internet Era
ITU Management Faculty – MIS
The New Economy (NE): Social Perspectives
Perspective 1: Sims –Taylor
• The new economy creates risks for Knowledge Workers
• Knowledge workers will be the first to be replaced by
automation with information technology
Perspective 2: Rikfin
• The overreliance on information technology has
caused society to act hastily (excess rapidity)
• The result has been a loss of perspective
Perspective 3: THE DIGITAL DIVIDE
• Those with access to information technology have
great advantages over those that don’t
• IT access will further polarize society
ITU Management Faculty – MIS
Trends in Technology
 Cost-performance ratio of chips keeps improving. Moore’s
Law, his prediction was that the processing power of
silicon chips would double every 18 months.
 Several new devices and methods to increase storage
capacity price performance
 Object-oriented programming technology enables the
development of self-contained units of software that can be
shared
 Networked and distributed computing is emerging rapidly
(Metcalfe’s Law).
ITU Management Faculty – MIS
Trends in Technology
 Internet
 Mobile Computing and M-Commerce
 Wireless networks
 Pervasive Computing
 Smart Devices
ITU Management Faculty – MIS
Trends in Technology
The Networked Enterprise
 The Network Computer
 Optical Networks
 Storage Area Networks
 Intranets & Extranets
 The Internet
ITU Management Faculty – MIS
Article Readings and Case Studies


An Evaluation of Toyota Motor Company IS
Politics of the Future – How the Internet is changing and will
change politics forever

How Obama’s Internet Campaign changed Politics (NY
Times) (http://www.barackobama.com/ Obama Everywhere)

How Information Technology is Revolutionizing the Field of
Medicine
 Nestle Struggles with Enterprise Systems
Please read and comment on “any” of these cases !
To be discussed in Week 3, opening session…
ITU Management Faculty – MIS