1. MIS
CHAPTER 1
INFORMATION SYSTEMS: AN OVERVIEW
Hossein BIDGOLI

2. Chapter 1 Information Systems: An Overview
l e a r n i n g o u t c o m e s
LO1 Discuss common applications of computers and information systems.
LO2 Explain the differences between computer literacy and information literacy.
LO3 Define transaction processing systems.
LO4 Define management information systems.
LO5 Describe the four major components of an information system.
LO6 Discuss the differences between data and information.

3. l e a r n i n g o u t c o m e s (cont’d.)
Chapter 1 Information Systems: An Overview
l e a r n i n g o u t c o m e s (cont’d.)
LO7 Explain the importance and applications of information systems in functional areas of a business.
LO8 Discuss how information technologies are used to gain a competitive advantage.
LO9 Explain the Five Forces Model and strategies for gaining a competitive advantage.
L1O Review the IT job market.
L11 Summarize the future outlook of information systems.

4. Computers and Information Systems in Daily Life
Computers and information systems are all around you
Online classes
Grading
Grocery and retail
PDA and smartphones
Internet
“Information systems” versus “information technology”: Used interchangeably

5. Computer Literacy and Information Literacy
Having skills in using productivity software
Information literacy
Understanding the role of information in generating and using business intelligence
Business intelligence (BI)
Provides historical, current, and predictive views of business operations and environments
Gives organizations a competitive advantage in the marketplace

6. The Beginning: Transaction Processing Systems
Transaction processing systems (TPSs)
Focus on data collection and processing,
Cost reduction
Operations repetitive
Human involvement minimal

7. Management Information Systems
Management information system (MIS)
Organized integration of hardware and software technologies, data, processes, and human elements
Designed to produce timely, integrated, relevant, accurate, and useful information
For decision-making purposes
Include:
Hardware components
MIS software
Processes

8. Management Information Systems (cont’d.)
Designing an MIS
Define objectives
Collect and analyze data
Provide information in useful format
Used in both the private and public sectors
Many organizations use information systems to gain a competitive advantage

9. Major Components of an Information System
Data
Database
Process
Information

10. Exhibit 1.3
Major components of an information system

11. Data Data Sources of data Time orientation
Input to the system
Sources of data
External
Internal
Time orientation
Can be collected in different forms
Aggregated
Disaggregated

12. Database Database Essential for the success of any information system
Heart of an information system
Collection of all relevant data organized in a series of integrated files
Essential for the success of any information system
Managed with database management system (DBMS): e.g., Oracle
Reduces personnel time needed to gather, process, and interpret data manually

13. Process
Process
Generates the most useful type of information for decision making
Generally includes transaction-processing reports and models for decision analysis
Includes a wide range of models to support all levels of decision making

14. Information Information Quality of information
Output of an information system
Facts that have been analyzed by the process component
Quality of information
Timeliness
Integration with other data and information
Consistency and accuracy
Relevance

15. Information (cont’d.) User interface
Must be flexible and easy to use
Graphical user interfaces (GUIs)
Ultimate goal of an information system
Generate business intelligence (BI)

16. Examples of Information Systems
Example 1: A university
State university stores all student data in a database
Built-in query capability
Other types of analysis can be done
Example 2: Teletech
International textile company
Database stores data on products, suppliers, sales personnel, costs
Process components
Forecasting models

17. Using Information Systems and Information Technologies
Achieve goals of information systems
Examples
Internet
Databases
POS Systems
RFID tags

18. Information Technologies at The Home Depot
POS system
Fast customer service
Improved inventory management
Wireless network
Efficient in-store communication
Web site
Communicate with customers
Increase sales with online orders
RFID tags
Better manage inventory

19. The Importance of Information Systems
Second most important resource in any organization
Four Ms of resources:
Manpower
Machinery
Materials
Money

20. The Importance of Information Systems (cont’d.)
Personnel information system (PIS) or human resource information system (HRIS)
Designed to provide information that helps decision makers in personnel carry out their tasks more effectively
Use Web technologies
Main difference between an intranet and the Internet
Intranets are private / Internet is public

21. The Importance of Information Systems (cont’d.)
Logistics information system (LIS)
Designed to reduce the cost of transporting materials
Maintains safe and reliable delivery
Manufacturing information system (MFIS)
Manages manufacturing resources
Companies can reduce manufacturing costs, increase product quality, and improve inventory decisions

22. Information Technologies at UPS
UPS Delivery Intercept
Web-based service that allows customers to intercept and reroute packages before they are delivered
Package Flow Technology

23. The Importance of Information Systems (cont’d.)
Financial information system (FIS)
Provides information to financial executives in a timely manner
Marketing information system (MKIS)
Improve marketing decisions
Provide timely, accurate, and integrated information about the marketing mix

24. Using Information Technologies for a Competitive Advantage
Michael Porter
Professor at Harvard Business School
Identified three strategies for competing in the marketplace successfully
Overall cost leadership
Differentiation
Focus

25. Using Information Technologies for a Competitive Advantage (cont’d.)
Information systems
Help organizations reduce the cost of products and services
Assist with differentiation and focus strategies
Can help bottom-line and top-line strategies
Enterprise systems
Supply chain management (SCM)
Customer relationship management (CRM)
Enterprise resource planning (ERP)
Collaboration software

26. Information Technologies at Walmart
Walmart Satellite Network
Largest private satellite communication system in the United States
Links branch stores with the home office in Bentonville, Arkansas
POS systems
RetailLink
Electronic data interchange
RFID technologies

27. Using Information Technologies for a Competitive Advantage (cont'd.)
Differentiation strategies
Make products and services different from competitors
Examples: Apple, Amazon.com

28. Using Information Technologies for a Competitive Advantage (cont'd.)
Focus strategies
Concentrate on a specific market segment
Attempt to achieve a cost or differentiation advantage
Examples: Apple, Abercrombie & Fitch, Nordstrom

29. Porter’s Five Forces Model: Understanding the Business Environment
Michael Porter
For analyzing an organization, its position in the marketplace, and how information systems could be used to make it more competitive
Buyer power
Supplier power
Threat of substitute products or services
Threat of new entrants
Rivalry among existing competitors

30. Exhibit 1.4
The Five Forces Model

31. Porter’s Five Forces Model: Understanding the Business Environment (cont'd.)
Buyer power
High when customers have many choices
Low when they have few choices
Limit buyers’ choices by offering services that make it difficult for customers to switch
Supplier power
High when customers have fewer options
Low when customers have more options
Use information systems to make their products and services cheaper

32. Porter’s Five Forces Model: Understanding the Business Environment (cont'd.)
Threat of substitute products or services
High when many alternatives for an organization’s products or services available
Add services to make organization more distinct
Add fees to discourage customers from switching
Threat of new entrants
Low when duplicating a company’s product or service is difficult
Use focus strategies to ensure that this threat remains low

33. Porter’s Five Forces Model: Understanding the Business Environment (cont'd.)
Rivalry among existing competitors
High when many competitors occupy the same marketplace position
Low when there are few competitors

34. The IT Job Market One of the fastest growing segments in the economy
Categories
Operations and help desk
Programming
Systems design
Web design and Web hosting
Network design and maintenance
Database design and maintenance
Robotics and artificial intelligence

35. CTO/CIO
Top information systems job belongs to the chief technology officer (CTO) / chief information officer (CIO)
Oversees long-range planning
Keeps an eye on new developments that can affect a company’s success
Also chief privacy officer (CPO)
Responsibility for managing risks and business impacts of privacy laws and policies

36. Manager of Information Systems Services
Responsible for managing:
Hardware
Software
Personnel within the information systems department

37. Systems Analyst Responsible for: Requires:
Design and implementation of information systems
Requires:
Computer knowledge
Information systems background
Thorough understanding of business systems and functional areas within a business organization

38. Outlook for the Future Hardware and software costs continue to decline
Processing information less expensive in the future
Artificial intelligence and related technologies will continue to improve and expand
Computer literacy will improve
Networking technology will improve
Personal computers will continue to improve in power and quality

39. Outlook for the Future (cont'd.)
Internet growth will continue
Computer criminals will become more sophisticated
Protecting personal identity information will become more difficult

40. Summary Examples of uses for computers and information systems
Difference between computer literacy and information literacy
Management information system (MIS)
Data, database, process, and information
Porter
Three competitive strategies
Five Forces Model