The value of information is directly linked to how it helps decision makers achieve the organization’s goals Discuss why it is important to study and understand information systems Distinguish data from information and describe the characteristics used to evaluate the quality of data Principles of Information Systems, Seventh Edition

Models, computers, and information systems are constantly making it possible for organizations to improve the way they conduct business Name the components of an information system and describe several system characteristics Identify the basic types of models and explain how they are used Principles of Information Systems, Seventh Edition

Knowing the potential impact of information systems and having the ability to put this knowledge to work can result in a successful personal career, organizations that reach their goals, and a society with a higher quality of life List the components of a computer-based information system Identify the basic types of business information systems and discuss who uses them, how they are used, and what kinds of benefits they deliver Principles of Information Systems, Seventh Edition

System users, business managers, and information systems professionals must work together to build a successful information system Identify the major steps of the systems development process and state the goal of each Principles of Information Systems, Seventh Edition

Information systems must be applied thoughtfully and carefully so that society, business, and industry can reap their enormous benefits Describe some of the threats to security and privacy that information systems and the Internet can pose Discuss the expanding role and benefits of information systems in business and industry Principles of Information Systems, Seventh Edition

Introduction Information system (IS) A set of interrelated components that collect, manipulate, and disseminate data and information and provide feedback to meet an objective Examples: ATMs, airline reservation systems, course reservation systems Principles of Information Systems, Seventh Edition

Information Concepts: Data Versus Information Data: raw facts Information: collection of facts organized in such a way that they have additional value beyond the facts themselves Principles of Information Systems, Seventh Edition

Table 1.1: Types of Data Principles of Information Systems, Seventh Edition

Figure 1.1: Defining and Organizing Relationships Among Data Creates Information Principles of Information Systems, Seventh Edition

Figure 1.2: The Process of Transforming Data into Information Principles of Information Systems, Seventh Edition

Table 1.2: Characteristics of Valuable Data Principles of Information Systems, Seventh Edition

Table 1.2: Characteristics of Valuable Data (continued) Principles of Information Systems, Seventh Edition

System and Modeling Concepts System: a set of elements or components that interact to accomplish goals Components of a system Input Processing Output Feedback Principles of Information Systems, Seventh Edition

Figure 1.3: Components of a System Principles of Information Systems, Seventh Edition

System Components and Concepts System boundary: defines the system and distinguishes it from everything else (i.e., the environment) Configuration: the way system elements are organized or arranged Systems can be classified as simple or complex, open or closed, stable or dynamic, adaptive or nonadaptive, and permanent or temporary Principles of Information Systems, Seventh Edition

Table 1.3: Systems Classifications and Their Primary Characteristics Principles of Information Systems, Seventh Edition

System Performance and Standards Efficiency: a measure of what is produced divided by what is consumed Effectiveness: extent to which system attains its goals System performance standard: a specific objective of a system Principles of Information Systems, Seventh Edition

System Variables and Parameters System variable: quantity or item controlled by the decision maker System parameter: value or quantity that cannot be controlled (e.g., the cost of a raw material) Principles of Information Systems, Seventh Edition

Modeling a System Model: an abstraction that is used to represent reality Four major types of models: narrative (based on words); physical (tangible); schematic (graphic representation); mathematical (arithmetic representation) Principles of Information Systems, Seventh Edition

Figure 1.6: Four Types of Models Principles of Information Systems, Seventh Edition

Figure 1.7: The Components of an Information System Principles of Information Systems, Seventh Edition

Input, Processing, Output, Feedback Input: activity of gathering and capturing raw data Processing: converting or transforming data into useful outputs Output: production of useful information, usually in form of documents and reports Feedback: output used to make changes to input or processing activities Principles of Information Systems, Seventh Edition

Computer-Based Information Systems Computer-based information system (CBIS) A single set of hardware, software, databases, telecommunications, people, and procedures that are configured to collect, manipulate, store, and process data into information Examples: a company’s payroll systems, order entry system, and inventory control systems Principles of Information Systems, Seventh Edition

Figure 1.8: The Components of a Computer-Based Information System Principles of Information Systems, Seventh Edition

Business Information Systems Most common types of information systems used in business organizations include: Electronic and mobile commerce systems Transaction processing systems Management information systems Decision support systems Principles of Information Systems, Seventh Edition

Electronic and Mobile Commerce E-commerce: any business transaction executed electronically between parties Parties involved include companies (B2B); companies and consumers (B2C); consumers and other consumers (C2C); businesses and the public sector; consumers and the public sector Principles of Information Systems, Seventh Edition

Transaction Processing Systems and Enterprise Resource Planning Transaction: any business-related exchange, such as payments to employees, sales to customers, and payments to suppliers Transaction processing system (TPS): an organized collection of people, procedures, software, databases, and devices used to record completed business transactions Principles of Information Systems, Seventh Edition

Figure 1.11: A Payroll Transaction Processing System The inputs (numbers of employee hours worked and pay rates) go through a transformation process to produce outputs (paychecks) Principles of Information Systems, Seventh Edition

Enterprise Resource Planning Enterprise resource planning (ERP) system: set of integrated programs that can manage a company’s entire set of business operations ERP systems often coordinate planning, inventory control, production, and ordering Principles of Information Systems, Seventh Edition

Information and Decision Support Systems Management information system (MIS): an organized collection of people, procedures, software, databases, and devices that provides routine information to managers and decision makers Primary focus of an MIS is on operational efficiency Principles of Information Systems, Seventh Edition

Figure 1.12: Functional Management Information Systems Principles of Information Systems, Seventh Edition

Management Information Systems MIS outputs Scheduled reports Demand reports Exception reports Principles of Information Systems, Seventh Edition

Decision Support Systems Decision support system (DSS): an organized collection of people, procedures, software, databases, and devices used to support problem-specific decision making Focus of a DSS is on decision-making effectiveness Principles of Information Systems, Seventh Edition

Figure 1.13: Essential DSS Elements Principles of Information Systems, Seventh Edition

Specialized Business Information Systems Artificial intelligence (AI) systems Virtual reality systems Expert systems Other special-purpose business information systems Principles of Information Systems, Seventh Edition

Figure 1.14: The Major Elements of Artificial Intelligence Principles of Information Systems, Seventh Edition

Systems Development Systems development: the activity of creating or modifying existing business systems Systems investigation: gaining a clear understanding of the problem to be solved or opportunity to be addressed Systems analysis: defines the problems and opportunities of the existing system Principles of Information Systems, Seventh Edition

Figure 1.17: An Overview of Systems Development Principles of Information Systems, Seventh Edition

Systems Development (continued) Systems design: determines how new system will work to meet business needs defined during systems analysis Systems implementation: creating or acquiring the various system components defined in design step, assembling them, and putting new system into operation Systems maintenance and review: check and modify system so that it continues to meet changing business needs Principles of Information Systems, Seventh Edition

Information Systems in Society, Business, and Industry Information systems must be implemented thoughtfully and carefully Information systems face a variety of threats from unethical people Principles of Information Systems, Seventh Edition

Figure 1.18: Attacks on Businesses and Other Organizations in One Year Principles of Information Systems, Seventh Edition

Figure 1.19: The Cost and Cause of Computer Attacks Principles of Information Systems, Seventh Edition

Computer and Information Systems Literacy Computer literacy: knowledge of computer systems and equipment and the ways they function Information systems literacy: knowledge of how data and information are used Principles of Information Systems, Seventh Edition

Information Systems in the Functional Areas of Business Finance and accounting (e.g., forecast revenues and business activity; analyze investments; perform audits) Sales and marketing (e.g., product analysis; promotion analysis; price analysis) Manufacturing (e.g., process orders; develop schedules; control inventory) Principles of Information Systems, Seventh Edition

Information Systems in Industry Airline industry (e.g., Internet auction sites) Investment firms (e.g., analyze stocks and bonds) Banks (e.g., online check payment) Transportation industry (e.g., schedule trucks and trains) Publishing companies (e.g., analyze markets) Principles of Information Systems, Seventh Edition

Information Systems in Industry (continued) Healthcare organizations (e.g., track patient records) Retail companies (e.g., process customer orders) Power management and utility companies (e.g., monitor and control power generation and usage) Professional services (e.g., provide information on products and services to its consultants) Principles of Information Systems, Seventh Edition

Summary Data: raw facts Information: collection of facts organized in such a way that they have value beyond the facts themselves System: a set of elements that interact to accomplish a goal Components of a system: input, processing, output, and feedback A model is an abstraction that is used to represent reality Principles of Information Systems, Seventh Edition

Summary (continued) Computer-based information system (CBIS): a single set of hardware, software, databases, telecommunications, people, and procedures that are configured to collect, manipulate, store, and process data into information Transaction processing system (TPS): an organized collection of people, procedures, software, databases, and devices used to record completed business transactions Principles of Information Systems, Seventh Edition

Summary (continued) Management information system (MIS): an organized collection of people, procedures, software, databases, and devices used to provide routine information to managers and decision makers Decision support system (DSS): an organized collection of people, procedures, software, databases, and devices used to support problem-specific decision making Systems development: the activity of creating or modifying existing business systems Principles of Information Systems, Seventh Edition