1. McGraw-Hill/Irwin ©2009 The McGraw-Hill Companies, All Rights Reserved Business Driven Information Systems 2e CHAPTER 1 INFORMATION SYSTEMS IN BUSINESS CHAPTER 1 INFORMATION SYSTEMS IN BUSINESS

2. McGraw-Hill/Irwin ©2009 The McGraw-Hill Companies, All Rights Reserved SECTION 1.1 INFORMATION SYSTEMS IN BUSINESS

3. 13 INFORMATION TECHNOLOGY BASICS Information technology (IT) – a field concerned with the use of technology in managing and processing information Information technology is an important enabler of business success and innovation

4. 14 INFORMATION TECHNOLOGY BASICS Management information systems (MIS) – a general name for the business function and academic discipline covering the application of people, technologies, and procedures to solve business problems MIS is a business function, similar to Accounting, Finance, Operations, and Human Resources

5. 15 INFORMATION TECHNOLOGY BASICS Some Important concepts: –Data, information, and business intelligence –IT resources

6. 16 Information Data - raw facts that describe the characteristic of an event Information - data converted into a meaningful and useful context Business intelligence – applications and technologies that are used to gather, provide access to, and analyze data and information to support decision-making efforts

7. 17 ROLES AND RESPONSIBILITIES IN IT Information technology is a relatively new functional area Recent IT strategic positions include: –Chief Information Officer (CIO) –Chief Technology Officer (CTO) –Chief Security Officer (CSO) –Chief Privacy Officer (CPO) –Chief Knowledge Office (CKO)

8. 18 ROLES AND RESPONSIBILITIES IN IT Chief Information Officer (CIO) – oversees all uses of IT and ensures the strategic alignment of IT with business goals and objectives Broad CIO functions include: –Manager – ensuring the delivery of all IT projects, on time and within budget –Leader – ensuring the strategic vision of IT is in line with the strategic vision of the organization –Communicator – building and maintaining strong executive relationships

9. 19 ROLES AND RESPONSIBILITIES IN IT What concerns CIOs the most

10. 110 ROLES AND RESPONSIBILITIES IN IT Skills pivotal for success in executive IT roles

11. 111 The Gap Between Business Personnel and IT Personnel Business personnel possess expertise in functional areas such as marketing, accounting, and sales IT personnel have the technological expertise

12. 112 Improving Communication Business personnel must seek to increase their understanding of IT IT personnel must seek to increase their understanding of the business

13. 113 MEASURING IT’S SUCCESS Questions executives should ask regarding IT systems –How do I define success? –Is the IT operation performing satisfactorily? How do I define that?

14. 114 MEASURING IT’S SUCCESS Key performance indicator (KPI) – measures that are tied to business drivers Metrics are detailed measures that feed KPIs –Performance metrics require input from both IT and business professionals

15. 115 Efficiency and Effectiveness Metrics Efficiency IT metric – measures the performance of the IT system itself Effectiveness IT metric – measures the impact IT has on business processes and activities

16. 116 Benchmarking – Baselining Metrics Benchmarks – baseline values the system seeks to attain Benchmarking – a process of continuously measuring system results, comparing results (benchmark values), and identifying improvements

17. 117 The Interrelationships of Efficiency and Effectiveness IT Metrics Efficiency IT metrics focus on technology and include: –Throughput –Transaction speed –System availability –Information accuracy –Web traffic –Response time

18. 118 The Interrelationships of Efficiency and Effectiveness IT Metrics Effectiveness IT metrics focus on an organization’s goals, strategies, and objectives and include: –Usability –Customer satisfaction –Conversion rates –Financial

19. McGraw-Hill/Irwin ©2009 The McGraw-Hill Companies, All Rights Reserved SECTION 1.2 BUSINESS STRATEGY

20. 120 IDENTIFYING COMPETITIVE ADVANTAGES Competitive advantage – a product or service that an organization’s customers place a greater value on than similar offerings from a competitor First-mover advantage – occurs when an organization can significantly impact its market share by being first to market with a competitive advantage

21. 121 THE FIVE FORCES MODEL – EVALUATING BUSINESS SEGMENTS Porter’s Five Forces Model determines the relative attractiveness of an industry

22. 122 THE THREE GENERIC STRATEGIES – CREATING A BUSINESS FOCUS Organizations typically follow one of Porter’s three generic strategies when entering a new market

23. 123 THE THREE GENERIC STRATEGIES – CREATING A BUSINESS FOCUS

24. 124 Value Creation Value Chain