Chapter 1 Information Systems Overview

Chapter Objectives Understand the term “information system” (IS), Describe the evolution of computing, Explain the technology, people, and organizational components of an IS Discuss how IS can be used to automate, informate, and strategically support business Describe IS’ critical, strategic importance to the success of modern organizations

The Components of an Information System

Information Systems Defined Information systems are combinations of hardware, software, and telecommunications networks which people build and use to collect, create, and distribute useful data, typically in organizational settings.

Rapid Rise in the Development and Use of Technology The computer industry is characterized by rapid change The field has a high growth rate and vast revenues Technology is widely covered in both popular and business press Technology is critical to businesses today

IS Past and Present The evolution in computing IS today Technology side of IS People side of IS Organizational side of IS

The Evolution in Computing Mainframe era to 1970 Mini-computer era to 1980 Personal computing era to 1985 Interpersonal computing era to 1990 Internetworking era ’s

IS Today Encompasses a diverse range of computing and networking technologies Includes a variety of network capabilities Includes a wide variety of peripherals Allows users more responsibility for management of the technology Has increased professionalism of IS positions

The Technology Side of IS Technology –Any mechanical and/or electrical means to supplement or replace manual operations Information technology (IT) –Any use of machine technology that is controlled by or uses information Information systems (IS) is a subset of IT

The People Side of IS Those who develop, maintain, use, manage, and study information systems –IS professionals in organizations –IS consultants –Professors –Researchers

The Organizational Side of IS IS used by all types of organizations –Professional –Social –Religious –Educational –Governmental

Dual Nature of Information Systems An Information System Gone Awry: Denver International Airport An Information System that Works: Federal Express

Information Systems for Competitive Advantage Systems can be developed with a strategic intent To gain or sustain a competitive advantage

IS for Automating: The First Step View technology as a way to continue doing the same things Use technology to automate existing tasks Early stages of IS focused on automating

IS for Informating: The Second Step View technology as a vehicle for organizational learning Use technology to provide information about operations Use technology to help detect problems with processes Use of technology without informating can make a bad process worse

IS as Strategic Enabler: The Final Step View technology as an enabler of organizational strategy Use technology to conduct strategic planning for an organization IS used to achieve organizational strategies

Five Organizational Strategies Market Target

Sources of Competitive Advantage Have the best product on the market Deliver superior customer service Achieve lower costs than rivals Have a proprietary technology Have shorter lead times to new products Have a well-known brand name Provide customers more value for their money

IS and Value Chain Analysis Value chain analysis –Studying an organization’s activities to determine where value is added to a product or service Provides opportunities to add value to an organization

An Organizational Value Chain

The Role of Information Systems in Value Chain Analysis Automate activities along the value chain Improve the front end of the value chain –Electronic Data Interchange (EDI) Improve the back end of the value chain –Service after the sale

The Technology/Strategy Fit Choose an IS that automates, informates, and matches the strategic plan Need two strategic plans tightly coupled –One for the overall organization –One for the Information System Make every technology decision a strategic decision