Business Information Systems Lecture 2: The Case for Information Systems

Questions Posed What is the value of the Internet? What is the value of data

Need for Information Systems Development in ICT does not just enhance current ways of doing business but brings a radical new impetus to business. 24 hour Banking The Postal Service Demise The Demise of regular phone calls Video calling Smart Televisions Internet at home Online shopping Online bill payments Internet of things Whatsapp calling Big data and Data Analytics

Components of an Information Systems Information Systems: Have the following components People Hardware Software Communication Systems Data Resources Interpretation (knowledge/decisions)

Computer BASED Information System Computer Hardware Computer Software Telecommunication Systems Databases/Data People Interpretation

Roles of IS in Business Support Business Processes Online banking and payment systems Online registration Support Decision Making Stocking of shelves due to automated inventory on store shelves Instant replay in National Basketball League Goal Line Technology in the World Cup and some Soccer Leagues Support Competitive Advantage Online shopping using a smartphone applet Renewal of insurance via your cellphone applet Online betting at (Borrowdale race course) due to connectivity Data analytics of existing and dynamic data

Connectivity enables innovative business applications E-business is the use of Internet-based connectivity to conduct various business processes Intranet-based: The information systems that uses the internal network for connectivity and functionality Extranet-based: The information systems that use the organization’s extended network for connectivity. i.e., organization and its business partners Internet-based: The information system that uses the organization and its clients connectivity to the Internet

Kinds of Information Systems Information Systems to support Operations Business transaction: Accounting, Marketing Industrial Processing control: car assembling, bottling and packaging Enterprise Collaboration: Email, Chat, Discussion forums Information Systems to Support Decision Making Management information: Precast reporting, sales analysis, production performance Decision support: profitability forecasting, risk analysis Executive “Tailored” Information

Basic Strategies in The Business Use of ICT Lowering of costs Cost of business processes Costs to customers and suppliers Differentiate Develop new ICT features to differentiate products and services Reduce the differentiations advantages of competitors Focus products and services at selected market niches Innovate Create new products Develop unique new market niches Make radical changes to business processes that dramatically cut costs, improve quality, efficiency, customer service, shorten time to market

Basic Strategies in The Business Use of ICT Promote Growth Manage regional and global expansion Diversify and integrate into other products and services Develop Alliances Create virtual organizations and business partners Using your extranet to develop systems that support strategic business relationships with customers, suppliers, subcontractors etc.

Talking Example Your organization has fifteen retail outlets around the country and two warehouses from which goods are dispatched. In each of the retail outlets there is: Checking out of goods by customers at till points Ordering of wares from the warehouse by the assistant shop manager Production and submission of status reports by the shop manager Adhoc stocktaking and product tagging by the controls department. Competition has been stiff in the retail sector. After an initial surge in sales there has been a steady decline in your market share as both local and foreign players have been active in the retail space. It has come to your attention that globally a number of organizations have used on-line shopping or on-line selling quite successfully.

Online store Resident on internet in form website and/or app Website hosting Links of the database, Extranet with your shipping agents Payment system Security to avoid hacking of online store Backup of the system Close some of the shops Market products online/internet Website with popups Social media page (Facebook or Instagram) Email lists with our target market Make your old clients aware of the new platform Visit your competition for prices and ideas Live chat on the website/socialmedia (automated live chat elevated when out of range) Customer feedback facility JIT – turning your suppliers into distributors Door to door delivery to steam local competition Robots for delivery Database of customer likes for relevant adverts Loyalty cards Server to control all the communication Online receipts Promotions by bringing

July 2016 Solution Reduce number outlets and invest in IT for Online selling Automate stock taking Automate order levels (thus reducing assistant stock managers) Huge operational costs because of the number of warehouses relative to the outlets. Maintain the outlets for visibility, but reduce the number of workers through automation Reorder automation is triggered by purchase at shop, hence change of role of assistant Shops become warehouses as you are coupling with online shopping and where the customer is located. Stock of the right goods through the sales analysis Centralization of the purchasing processes to reduce costs Monitoring of the goods through the scanning at till points through the bar codes system