1. Information Systems Defined
Chapter 2
Information Systems Defined
Basic definitions and foundational Information Systems concepts
© Gabriele Piccoli

2. Course Roadmap Part I: Foundations
Chapter 1: Introduction
Chapter 2: Information Systems Defined
Chapter 3: Organizational Information Systems and Their Impact
Part II: Competing in the Internet Age
Part III: The Strategic use of Information Systems
Part IV: Getting IT Done
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3. Learning Objectives
Be able to define information system (IS) and information technology (IT). Understand the difference between the two.
Be able to define information system success and information system failure.
Be able to explain why modern firms create and deploy information systems.
Be able to discuss the role that the firm’s context and the external environment play in shaping organizational information systems.
Be able to describe the four components that make up an information system. Understand how they interact through systemic effects.
Be able to discuss how to design successful information systems.
Be able to troubleshoot problematic information systems implementations.
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4. Introduction
Organizations around the world continue to spend significant amounts of money on IT
These investments must pay off
For investments to pay off you cannot have a narrow focus on IT
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5. Information System: Definition
Formal, socio-technical, organizational systems designed to collect, process, store, and distribute information
Formal  Ferrari’s supply chain system
Informal  Facebook
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6. IS ≠ IT Ricasoli Winery Did they have an information system in 1141?
1141: Opened
Oldest winery in Italy
Did they have an information system in 1141?
Courtesy of Barone Ricasoli
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7. IS ≠ IT Hilton Hotels 1919: Opened
Did they have an information system in 1919?
Photo by Jim Henderson (public domain)
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8. IS ≠ IT Hilton Hotels 1919: Opened
1963: First implementation of computers in hospitality (New York Hilton)
Photo by Jim Henderson (public domain)
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9. Information System Components
Technology
Process
People
Structure
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10. Why is this Important?
You need a solid understanding of the characteristics of each of the four components
You need an appreciation of how they relate and interact with one another
In order to make appropriate business decisions as a general or functional manager
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11. #1: Information Technology
Hardware Devices
Servers, smartphones, game consoles
Software Tools
Microsoft Office, foursquare app
Telecommunication Devices
Internet
IT is a cornerstone of any modern IS
IT enables and constrains action through rules of operation that stem from its design
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12. Don’t Forget!
The design of IT enables and constrains the behavior of the Information System
“Software, particularly a custom developed application, is an opinion of how data should be represented, organized, and manipulated”
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13. #2: Process
The series of steps necessary to complete a business activity
Examples:
Check-in at a hotel
Credit approval at a bank
Paying bills online
There are multiple ways to perform the same activity
Processes are designed to be efficient & effective
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14. Official business process
Don’t Forget!
Processes evolve and change over time, often away from the original design
Official business process
Informal process
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15. Comparison Formal Business Process Informal Process
Check the inventory and identify the needed items
Call individual suppliers for quotes and delivery dates
Compare the various quotes
Select one or more suppliers for each of the needed items based on the terms of the agreement
Call these suppliers and place the orders
Receive the goods upon delivery, checking the accuracy and quality of the shipped items
Pay the suppliers according to agreed upon terms.
Restock inventory when needed
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16. #3: People
Those individuals or groups directly involved in the information system
End-users
Managers
Addressing their needs is a critical concern when designing and implementing a new Information System
Failure to do so will result in the failure of your information systems
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17. #4: Structure The organizational structure component encompasses:
Organizational design
Hierarchy, decentralized, loose coupling
Reporting configuration
Functional, divisional, matrix
Organizational relationships
Communication and reward mechanisms
Culture
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18. Systemic Effects
The four components of an Information System are Interdependent
Changes in one component may affect all others
You must ensure the proper interaction of IT with the other components
Discuss systemic affects of designing and trouble shooting a system.
What are some options for addressing problems?
1. You could deem the new system a failure and cut your losses by dropping the use of hand-held technology altogether.
2. You could ascribe the failure to the quality of the user interface of the hand-held ordering devices. You could then negotiate with the provider to improve it. A solution focusing on the IT component.
Etc.
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19. The Purpose of Information Systems
Fulfilling organizational processing needs
Improving efficiency and effectiveness while reducing cost
Achieving a (specified) Information System goal.
Example: Movie theaters
Goal: Offering customers the ability to purchase tickets online will improve the effectiveness of the theater by reducing the lines and inconvenience at the ticket counter
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20. Information Systems Success
Has the system delivered expected results?
What are some of the unintended results?
Positive
Negative
Positive - including employees’ empowerment and the widening scope of their responsibility
Negative - including deskilling (i.e., the reduction of the scope of an individual's work to one, or a few, specialized tasks), loss of responsibility, and the creation of a monotonous working environment.
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21. IS Success can be Elusive
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22. Don’t Forget! Every organization is unique
Even fierce competitors often have different:
Firm strategies: The manner in which the organization intends to achieve its objectives.
Firm cultures: The collection of beliefs, expectations, and values shared by the members of an organization.
Infrastructures: The technological backbone of the firm.
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23. External Environment External environment:
The legal and regulatory context
The competitive landscape
The general business and social trends surrounding the organization
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24. Information Systems in Context
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25. Information Systems and Organizational Change
First Order Change: Automate
Second Order Change:
Informate
Third Order Change: Transform
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26. First Order Change: Automate
First order change only affects the technical subsystem
Thus, it is:
Easiest to envision
Easiest to justify
Easiest to manage
Affects only technology and process
Occurs when IT innovation is introduced
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27. Second Order Change: Informate
Second order change affects the people component
It provides more of an implementation challenge
Affects technology and process
Affects people performing the process
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28. Third Order Change: Transform
Third order change affects organizational structures
It seeks to transform how the organization operates
It requires significant managerial and executive involvement
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29. Organizational Culture
Firms have a culture
They assume an organizational culture that fits with an individualistic, egalitarian or uncertainty tolerant mindset
There has to be a harmonious relationship between organizational culture and the IS design in order for the IS to be effective in the firm
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30. Implications
IT should NOT be the start of your Information System design process
Strategy may be inspired, not driven, by IT
IT selection is a point of arrival not departure
Never forget Systemic Effects
components of an IS mutually influence one another
Anticipate the “ripples”
You must anticipate & manage systemic effects
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31. Implications IS evolve over time. You must:
Evaluate individual IS components regularly
Assess how different organizational systems work together to support the business
Optimize the Information System as a whole, not the components individually
Organizations are dynamic
They need to be re-evaluated often
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32. The Recap
Information systems are designed and built with the objective of improving the firm’s efficiency and effectiveness by fulfilling its information processing needs.
Success can only occur when the systems that are used achieve their intended goals
Information systems exist in an organizational context, characterized by the firm strategy, culture, and IT infrastructure.
Every organization is subject to the influences of an ever-changing external environment, including regulatory requirements, social and business trends, and competitive pressures.
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33. The Recap New IS components bring about organizational change.
Information systems are subject to systemic effects
You will need to manage these systemic effects in order to realize information system objectives and expected outcomes
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34. What We Learned
The definition of information system (IS) and information technology (IT) and the difference between the two.
The definition of information system success and information system failure.
The principal reasons why modern firms create and deploy information systems.
To recognize and manage the influence of a firm’s context and of the external environment organizational information systems design and success.
The four components that make up an information system and the ways in which they interact.
How to design successful information systems and how to troubleshoot problematic information systems implementations.
© Gabriele Piccoli