The Strategic Role Of Information Systems

Introduction Information system (IS) äSet of interrelated components: collect, manipulate, store, and disseminate data and information äProvides feedback to meet an objective äExamples: ATMs, airline reservation systems, course reservation systems

Information Concepts: Data, Information, and Knowledge Data: raw facts äAlphanumeric, image, audio, and video Information: collection of facts organized in such a way that they have additional value beyond the value of the facts themselves

Figure 1.2: The Process of Transforming Data into Information Data, Information, and Knowledge

The Value of Information Value of information is directly linked to how it helps decision makers achieve their organization’s goals For example, value of information might be measured in: äTime required to make a decision äIncreased profits to the company

The Characteristics of Valuable Information Table 1.2: Characteristics of Valuable Information

The Characteristics of Valuable Information Table 1.2: Characteristics of Valuable Information (continued)

What Is an Information System? Figure 1.3: The Components of an Information System

Computer-Based Information Systems Figure 1.4: The Components of a Computer-Based Information System

Traditional View of the Systems

Four types of system configuration: Centralized Systems Duplicated Systems Decentralized Systems Networked Systems Global System Configuration

Business Information Systems Figure 1.5: Business Information Systems

Types of Information Systems

TYPES OF INFORMATION SYSTEMS

Enterprise Systems

Benefits: Firm structure and organization: One organization Management: Firm-wide knowledge-based management processes Technology: Unified platform Business: More efficient operations and customer-driven business processes Challenges: Difficult to build: Require fundamental changes in the way the business operates Technology: Require complex pieces of software and large investments of time, money, and expertise Centralized organizational coordination and decision making: Not the best way for the firms to operate

Management Information Systems Management information system (MIS) äOrganized collection of people, procedures, software, databases, and devices äProvides routine information to managers/decision makers Primary focus is operational efficiency

Management Information Systems Figure 1.10: Management Information System

Decision Support Systems Decision support system (DSS) äOrganized collection of people, procedures, software, databases, and devices äSupports problem-specific decision making Focus is on decision-making effectiveness

Decision Support Systems Figure 1.11: Essential DSS Elements

Specialized Business Information Systems: Knowledge Management, Artificial Intelligence, Expert Systems, and Virtual Reality Knowledge management systems (KMSs): an organized collection of people, procedures, software, databases, and devices to create, store, share, and use the organization’s knowledge and experience Artificial intelligence (AI): field in which the computer system takes on the characteristics of human intelligence

Artificial Intelligence Figure 1.12: The Major Elements of Artificial Intelligence

Organizations and Information Systems Figure 1.16: The Value Chain of a Manufacturing Company

Organizations and Information Systems Supply chain management (SCM) äDetermines required supplies, needed quantities, processing, and shipment Customer relationship management (CRM) äHelps company manage all aspects of customer encounters, including marketing, advertisement, sales, service, and maintaining loyalty

Specific Applications: Customer Relationship Management (CRM)

Specific Applications: Supply Chain How do information systems facilitate supply chain management?

Specific Applications: Collaborative Commerce How do information systems facilitate collaborative commerce?

Performance-Based Information Systems Figure 1.18: Three Stages in the Business Use of Information Systems

Roles, Functions, and Careers in the IS Department Figure 1.19: The Three Primary Responsibilities of Information Systems

Global Challenges in Information Systems Cultural challenges Language challenges Time and distance challenges Infrastructure challenges Currency challenges Product and service challenges Technology transfer issues State, regional, and national laws Trade agreements