Management Information Systems
Chapter One
Foundations of Information Systems in
Business
Md. Golam Kibria
Lecturer, Southeast University
Information System
Information system is any organized
combination of people, hardware,
software, communications networks,
and data resources that stores,
retrieves, transforms, and disseminates
information in an organization.
Information Technology


Information
Technology
is
the
integration of computers, communications
equipment, and other technology used in
information systems.
The technology uses to generate
information
is
called
Information
Technology ( IT)
Information Systems vs.
Information Technology

Information
Systems
(IS)
–
all
components and resources necessary to
deliver information and information
processing functions to the organization

Information Technology (IT) – various
hardware components necessary for the
system to operate
Strategic Business Objectives

Business firms invest heavily in information systems
to achieve six strategic business objectives:
1. Operational excellence
2. New products, services, and business
models
3. Customer and supplier intimacy
4. Improved decision making
5. Competitive advantage
6. Survival

Operational excellence:



Improvement of efficiency to attain higher
profitability
Information systems, technology an important
tool in achieving greater efficiency and
productivity
Walmart’s RetailLink system links suppliers to
stores for superior replenishment system

New products, services, and business
models:



Business model: describes how company produces,
delivers, and sells product or service to create wealth
Information systems and technology a major enabling
tool for new products, services, business models
Examples: Apple’s iPod, iTunes, iPhone, iPad,
Google’s Android OS, and Netflix

Customer and supplier intimacy:

Serving customers well leads to customers returning,
which raises revenues and profits


Example: High-end hotels that use computers to
track customer preferences and use to monitor
and customize environment
Intimacy with suppliers allows them to provide vital
inputs, which lowers costs

Example: J.C.Penney’s information system which
links sales records to contract manufacturer

Improved decision making

Without accurate information:




Managers must use forecasts, best guesses, luck
Leads to:
 Overproduction, underproduction of goods and services
 Misallocation of resources
 Poor response times
Poor outcomes raise costs, lose customers
Example: Verizon’s Web-based digital dashboard to provide
managers with real-time data on customer complaints,
network performance, line outages, etc.

Competitive advantage

Delivering better performance

Charging less for superior products

Responding to customers and suppliers in real time

Examples: Apple, Walmart, UPS

Survival


Information technologies as necessity of business
May be:

Industry-level changes, e.g. Citibank’s
introduction of ATMs
Conceptual Framework of IS
Knowledge
Conceptual Framework of IS
Knowledge


Foundation
Concepts:
Fundamental
behavioral,
technical,
business,
and
managerial concepts about the components
and roles of information systems.
Information Technologies: Major concepts,
development, and management issues in
Information technology-that is, hardware,
software, networks, data management,
internet.
Conceptual Framework of IS
Knowledge


Business Application: The major uses of
information systems for the operations,
management, competitive advantages of a
business.
Development Processes: How business
professionals and information specialists
plan, develop, and implement information
systems to meet business opportunities.
Conceptual Framework of IS
Knowledge

Management
Challenges:
The
challenges of effectively and ethically
managing information technology at the
end user, enterprise, global levels of a
business.
Roles of IS in Business
Roles of IS in Business

Support
business
process
and
operations: As a consumer, you regularly
encounter information systems that support
the business processes and operations at
the many retail stores where you shop. Most
retail store now use computer based
information systems to help them record
customer purchase, keep track of inventory,
pay employees, evaluate sales trend.
Roles of IS in Business


Support Decision Making: Information
systems also help store manager and other
business professionals make better decision.
Support Competitive Advantage: Gaining
a strategic advantage over competitors
requires
innovative
applications
of
information technologies.
Ethical Challenges of IT
Functions of an Information System




Input Function accepts the input data from outside
the system.
Processing Function calculates and in other ways
manipulates the input and stored data.
Output Function produces results of processing for
use outside the system.
Feedback Function is the output that is returned to
appropriate members of the organization to help them
evaluate or correct the input state.
Functions of an Information
System
Information System Resources

People: People are the essential ingredient
for the successful operation of all
information
systems.
These
people
resources includes– end users and IS
specialists.


End users: End users are people who use an
information systems or information it produces.
IS specialists: IS specialists are people who
develop and operate information systems.
Information System Resources

Hardware – physical devices and
materials used in information processing
including computer systems, peripherals,
and media.


Computer systems
Computer peripherals
Information System Resources

Software: Software includes all sets of
information processing instructions.



System software,
Application software
Procedures.
Information Systems Resources (con’t)


Data Resources – facts or observations
about physical phenomena or business
transactions
Network Resources– communications
media and network infrastructure


Communications Media – examples include twisted-pair wire, coaxial
and fiber-optic cables, microwave, cellular, and satellite wireless
technologies
Network Infrastructure – examples include communications
processors such as modems and internetwork processors, and
communications control software such as network operating systems
and Internet browser packages.
Data vs. Information

Data – raw facts or observations typically
about physical phenomena or business
transactions.

Information – data that have been
converted into a meaningful and useful
context for specific end users.
Data Versus Information


Data is a representation of a fact, a
number, a word, an image, a picture or a
sound. For example, the number 10 is
data; it might represent image, a picture, or
a sound.
Information is data that is meaningful or
useful to someone. For example, the
statement “ There are 10 books left in
inventory”.
Data versus Information
Monthly Sales Report
for West Region
Sales Rep: Charles Mann
Emp No. 79154
Item
Qty Sold Price
TM Shoes 1200
$100
Data Vs. Information


Information for one person may be data for
another.
Data for one person may be information for
another.
Benefits & Pitfalls of Information
Systems
Benefits
Pitfalls
1. IS can perform calculations or process 1. By automating activities that were previously
paperwork much faster than people.
performed by people, IS may eliminate job.
2. IS can help companies learn more about the 2. IS may allow organization to collect personal
purchase patterns and preferences of their information about people that violate their
customers.
privacy.
3. IS provide new efficiencies through services 3. IS are used in so may aspects of everyday
such as ATMs, IP telephony, Computer life that system outages can cause shutdown of
controlled Airplanes and Air Terminals
businesses
or
transportation
services,
paralyzing communities.
4. IS have made possible new medical 4. Heavy users of IS may suffer repetitive stress
advances in surgery, radiology and patient injury, technostress and other health problems.
monitoring.
5. The internet distributes information instantly 5. The internet can be used to distribute illegal
to millions of people across the world.
copies of software, books, articles, and other
intellectual property.
Thanks
You