1. Copyright Prentice Hall, Inc. 1 Computers: Information Technology in Perspective, 11e Larry Long and Nancy Long Chapter 10 Information Systems

2. Copyright Prentice Hall, Inc.2 Objectives Once you have read and studied this chapter, you will have learned:  How the use of computers and information technology can result in a competitive advantage.  The qualities of information and how information needs and decision making vary at each level of an organization.  The elements, scope, and capabilities of an information system.  The capabilities of a data processing system and a management information system (MIS).  The tools and capabilities of a decision support system (DSS).  The concepts and applications of an expert system.  The concepts and applications of intelligent agents.

3. Copyright Prentice Hall, Inc.3 Why this chapter is important to you! Learning about information systems will help you participate in key office decisions no matter what the organization Learning about information systems will help you to understand where you and your company fit in the system Understanding will help you to use the right information system at the right time and in the right place

4. Copyright Prentice Hall, Inc.4 Information Technology as a Competitive Strategy Available technology can determine if you are profitable or not Information Technology can:  Give access to a world market  Improve product & service quality  Aid communication between employees  Reduce costs  Increase productivity  Improve company morale

5. Copyright Prentice Hall, Inc.5 Cost, Risk, and Change IT solutions can be expensive and time consuming Element of risk in the implantation of IT Implementing IT means change

6. Copyright Prentice Hall, Inc.6 Leveraging Information Technology Increasing sales Increasing market share Creating new business Collecting data at the source Eliminating the intermediary Improving customer service

7. Copyright Prentice Hall, Inc.7 Information and Decision Making Qualities of information Completeness of information Timeliness of information Relevance of information Accessibility of information

8. Copyright Prentice Hall, Inc.8 Making Decisions to Produce Products and Services Strategic Management Tactical Management Operational Management PlanOrganizeLeadControl ResourcesResourcesFunctionsFunctions Products & Services Services EmployeesManagersGovernmentCustomersStockholders Financial Institutions Colleges/ Agencies Media

9. Copyright Prentice Hall, Inc.9 Filtering Information Results in the right information reaching the right decision maker at the right time in the right form  Clerical Level Transaction Handling  Operational Level Exception Reports  Tactical Level What-if Reports  Strategic Level One-time reports, what-if reports, and trend analysis

10. Copyright Prentice Hall, Inc.10 Types of Decisions Programmed decisions  Address well-defined problems Information-based decisions  Unstructured decisions

11. Copyright Prentice Hall, Inc.11 What is an Information System Information processing capabilities  System’s ability to handle and process information Information to make better decisions  System’s ability to produce on-demand information Hardware Software ProceduresData People

12. Copyright Prentice Hall, Inc.12 What Can an Information System Do  Retrieve  Record  Update  Summarize  Select  Manipulate Processing  Hard copy  Soft copy  Control Output  Data  Text  Images  Other digital information StorageInput  Source data  Inquiry  Response to prompt  Instruction  Message  Change

13. Copyright Prentice Hall, Inc.13 Information System Types Manual system  No hardware  No software Function-based information system  Independent of other systems Integrated information system  Common databases

14. Copyright Prentice Hall, Inc.14 Getting Data into the System Online vs. Offline Source Data Source Documents Methods  Batch Processing  Transaction-Oriented Processing

15. Copyright Prentice Hall, Inc.15 Data Processing System Activities:  Transaction handling  Recordkeeping Action documents Scheduled reports Primarily support:  Clerical personnel  Operational-level managers Inflexible

16. Copyright Prentice Hall, Inc.16 What is MIS? An MIS is a computer- based system that:  Optimizes the collection, transfer, and presentation of information throughout an organization  Uses an integrated structure of databases and information flow

17. Copyright Prentice Hall, Inc.17 Decisions Support Systems DSS are interactive information systems DSS rely on an integrated set of user-friendly hardware and software tools These tools produce information to support management in the decision-making process

18. Copyright Prentice Hall, Inc.18 The DSS Versus the MIS MIS supports structured problems DSS supports semistructured and unstructured problems MIS is designed and created to support a set of applications DSS can be adapted to any decision environment

19. Copyright Prentice Hall, Inc.19 Characteristics of DSS Helps decision maker Semistructured & unstructured problems Most effective for tactical & strategic management levels Interactive and user-friendly Uses models, simulations, & analytical tools Readily adaptable to any decision environment Interacts with a corporate database Not used for pre-established production schedule

20. Copyright Prentice Hall, Inc.20 The DSS Tool Box Data Management  Data warehousing  Data mining Modeling  Decisions involve many factors  Uncertainty and risk present Statistical Analysis  Risk analysis  Trend analysis Applications Development  Throwaway systems  Support a one-time decision Planning  What-if  Goal seeking Inquiry Graphics Consolidations Application-specific

21. Copyright Prentice Hall, Inc.21 Executive Information Systems The EIS supposedly offer the same decision support tools as the DSS However, each tool is designed specifically to support decision making at the executive levels of management  Primarily the tactical and strategic levels

22. Copyright Prentice Hall, Inc.22 Expert Systems An Expert System is an interactive system  Responds to questions  Asks for clarification  Makes recommendations  Helps the user in the decision-making process Simulates human thought process  Reasons, draws inferences & makes judgments (heuristic knowledge) Information acquired from live domain experts Highest form of knowledge-based systems, not an assistant system

23. Copyright Prentice Hall, Inc.23 Expert System Example- Printer Replace technical support people Knowledge base contains:  Means of identifying problem Possible solutions How to progress from problem to solution

24. Copyright Prentice Hall, Inc.24 Intelligent Agents and BOTS Type of artificial intelligence Can act on our behalf We set its goals Agent may work on:  An ongoing goal Sort e-mail  An action triggered by an event  A one-time goal Send an e-mail Deliver a present Internet intelligent agents growing

25. Copyright Prentice Hall, Inc.25 Summary Information Technology as a Competitive Strategy Information and Decision Making All About Information Systems The DP System and the MIS Decision Support Systems Expert Systems Intelligent Agents and Bots