Introduction to MIS Chapter 1 Introduction Jerry Post

Introduction to MIS Chapter 1 Introduction Jerry Post Technology Toolbox: Search Engines Technology Toolbox: Searching Cases: Fast Food

Outline How can MIS help you in your job? � What is MIS? � Why is information technology important? Why do all business majors need to study it? � What are e-commerce and e-business? Is e-business increasing or decreasing? � Do you know what a manager does? Do you know what a successful manager will do in the future? � How is business changing? What will managers need to know in the future? � Does technology alone improve a business? � How do you break businesses into smaller pieces to analyze them? � Why are strategic decisions so difficult? How do you begin searching for competitive advantage? �

What is MIS? �Information ◦ Data that has been put into a meaningful and useful context. Usually to help make a decision. �Management Information System ◦ A combination of computers and people that is used to provide information to aid in making decisions and managing a firm. �Information Technology (IT)

MIS Components Hardware Software Backup data Restart job Virus scan People Procedures Data

Goal of This Course �How can MIS help you do your job? �Understand the technology. �Analyze business problems. �An introduction to systems analysis. �Identify types of problems that MIS can help solve through cases. �Ability to classify problems. �Know when to call for help.

Why is MIS Important? �MIS affects all areas of business ◦ ◦ ◦ Manufacturing Accounting & Finance Human resources Marketing Top management �Performance evaluations— expectations

Chapters/Topics 1. 2. 3. 4. 5. 6. 7. Introduction Technology Foundations Networks Databases Security Transactions and ERP e. Commerce 8. 9. 10. 11. 12. 13. 14. Teamwork Decisions Strategy Entrepreneurship Systems MIS Organization Society

Productivity Growth: Output per Worker Output per Person 120 100 80 60 40 0 1994 -Q 1 1994 -Q 3 1995 -Q 1 1995 -Q 3 1996 -Q 1 1996 -Q 3 1997 -Q 1 1997 -Q 3 1998 -Q 1 1998 -Q 3 1999 -Q 1 1999 -Q 3 2000 -Q 1 2000 -Q 3 2001 -Q 1 2001 -Q 3 2002 -Q 1 2002 -Q 3 2003 -Q 1 2003 -Q 3 2004 -Q 1 2004 -Q 3 2005 -Q 1 2005 -Q 3 2006 -Q 1 2006 -Q 3 2007 -Q 1 2007 -Q 3 2008 -Q 1 2008 -Q 3 2009 -Q 1 2009 -Q 3 2010 -Q 1 2010 -Q 3 20 1. Managers need to use technology to increase productivity to be competitive. 2. With a 2. 9% growth rate, in a decade, productivity increases 34%. Companies can produce the same output with half the workers. Will you be one of the workers replaced? http: //data. bls. gov: 8080/PDQ/outside. jsp? survey=pr

What are e-Commerce and e-Business? �Business-to-Consumer (B 2 C) ◦ Selling retail products to consumers �Business-to-Business (B 2 B) ◦ Selling at the wholesale level to other businesses �E-Business ◦ Using Internet technologies to conduct any level of business ◦ E-Commerce ◦ Intranets ◦ Most areas of MIS

Retail E-Commerce Statistics Retail Billtion $ U. S. Retail and E-Commerce Sales Retail Ecommerce 1200 60 1000 50 800 40 600 30 400 20 200 10 19 9 9 20 -4 00 20 -2 00 20 -4 01 20 -2 01 20 -4 02 20 -2 02 20 -4 03 20 -2 03 20 -4 04 20 -2 04 20 -4 05 20 -2 05 20 -4 06 20 -2 06 20 -4 07 20 -2 07 20 -4 08 20 -2 08 20 -4 09 20 -2 09 20 -4 10 20 -2 10 -4 0 In 2010 EC was about 5 percent of total. Remove autos and auto parts and EC is about 6 percent. Notice the seasonal peak in the fourth quarter. Notice the EC is growing faster than total retail sales. http: //www. census. gov/retail/index. html#ecommerce 0

Technology Excesses? • You can buy a new model item when it is released or wait for the price to drop. • You can keep buying new releases or continue to use an “old” model. • Answers depend on your needs, the features offered, and the reliability of the old items. • Plus the bling factor.

What do Managers do? �Traditional ◦ Organizing ◦ Planning ◦ Control �Mintzberg ◦ Interpersonal ◦ Informational ◦ Decisional �Luthans ◦ Traditional 50% ◦ Formal Communication 30% ◦ Networking 20%

Meetings Managers and professionals spend considerable time in meetings. Providing support for teamwork and group decisions is an important issues in MIS.

Making Decisions �Methodology v Ad Hoc Decisions �Decision Process ◦ Collect Data ◦ Identify Problems & Opportunities ◦ Make Choices 1 2 3

Traditional Management CEO Commands VP Finance VP Marketing VP Accounting Condensed reports VP HRM VP MIS Analyze data Layers of middle managers Customers Collect data

Decentralization Management Team CEO VP Fin VP Mrkt VP Acct VP HRM VP MIS Strategy Finance Team Marketing Team Sales Team Accounting Team Methodology/Rules Customers HRM Team Franchise Corporate Database & Network

Business Trends �Changing business environment ◦ Specialization ◦ Management by Methodology and Franchises ◦ Mergers ◦ Decentralization and Small Business ◦ Temporary Workers ◦ Internationalization ◦ Service-Oriented Business ◦ Re-engineering �Need for faster responses and flexibility

Business Trends & Implications � Specialization ◦ ◦ � Methodology & Franchises ◦ ◦ ◦ � Increased demand for technical skills Specialized MIS tools Increased communication Emphasis on Teamwork Reduction of middle management Increased data sharing Increased analysis by top management Computer support for rules Re-engineering Mergers ◦ Larger companies ◦ Need for control and information ◦ Economies of scale � Decentralization & Small Business ◦ Communication needs ◦ Lower cost of management tasks ◦ Low maintenance technology

Business Trend Summary Business Trend Implications for Technology Specialization 1. Increased demand for technical skills 2. Specialized MIS tools 3. Increased communication Methodology & Franchises 1. Reduction of middle management 2. Increased data sharing 3. Increased analysis by top management 4. Computer support for rules 5. Re-engineering Mergers 1. Four or five big firms dominate most industries 2. Need for communication 3. Strategic ties to customers and suppliers Decentralization & Small Business 1. Communication needs 2. Lower cost of management tasks 3. Low maintenance technology Temporary Workers 1. Managing through rules 2. Finding and evaluating workers 3. Coordination and control 4. Personal advancement through technology 5. Security Internationalization 1. Communication 2. Product design 3. System development and programming 4. Sales and marketing Service Orientation 1. Management jobs are information jobs 2. Customer service requires better information 3. Speed

Business Trends & Implications � Temporary Workers ◦ ◦ ◦ � Internationalization ◦ ◦ � Managing through rules Finding and evaluating workers Coordination and control Personal advancement through technology Security Communication Product design System development and programming Sales and marketing Service Orientation ◦ Management jobs are information jobs ◦ Customer service requires better information ◦ Speed

9 19 32 19 35 19 38 19 41 19 44 19 47 19 50 19 53 19 56 19 59 19 62 19 65 19 68 19 71 19 74 19 77 19 80 19 83 19 86 19 89 19 92 19 95 19 98 20 01 20 04 20 07 20 10 19 2 Percent Internationalization U. S. Trade Imports/GDP Exports/GDP 0. 2 0. 18 0. 16 0. 14 0. 12 0. 1 0. 08 0. 06 0. 04 0. 02 0 Year http: //www. bea. gov/national/nipaweb/Index. asp

International Web Browsers Web Users (Language) Korean; 2 Russian; 3 Other; 17. 8 English; 27. 3 French; 3 German; 3. 8 Portuguese; 4. 2 Arabic; 3. 3 Japanese; 5 Chinese; 22. 6 Spanish; 7. 8 http: //www. internetworldstats. com/stats 7. htm

Web Users (Counts) Oceania/ Australia; Africa; 21. 3 110. 9 Middle East; 63. 2 Latin America/ Caribbean; 204. 7 Million Users Asia; 825. 1 North America; 266. 2 Europe; 475. 1 Asia: 30 percent of population North America: 75 percent http: //www. internetworldstats. com/stats. htm

US Employment Patterns U. S. Employment Patterns 140 120 Million Workers 100 Farm 80 Manufacturing 60 Management Service 40 20 0 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 Categories and definitions have changed over time. Management includes professional, sales, and administrative. The key point is that most jobs are information-processing jobs. But the numbers measure number of workers, not the value or sales. http: //www. bls. gov/webapps/legacy/cpsatab 4. htm

Changing Business Environment �US History: Farmer Laborer Management Year Farm Mfg Mgt Service 1920 29% 44% 22% 6% 1940 23 38 30 8 1960 9 36 43 12 1980 3 32 52 13 2000 1 16 66 17 2010 1 11 68 20

Strategic Mgt. Tactical Management ER ES P Tr an DSS Pr oc sa es cti s C on on tro l EI S MIS Organization Business Operations

Operations, Tactics, Strategy

Decision Levels Decision Level Description Example Type of Information Strategic Competitive advantage, become a market leader. Long-term outlook. New product that External events, rivals, will change the sales, costs quality, industry. trends. Tactical Improving operations without restructuring the company. New tools to cut costs or improve efficiency. Operations Day-to-day actions to keep the company functioning. Scheduling Transactions, employees, accounting, human ordering supplies. resource management, inventory. Expenses, schedules, sales, models, forecasts.

Introduction to Strategy �Risk & Reward �Creativity �Porter’s External Agents ◦ ◦ Customers Suppliers Competitors Government

Strategy/Porter Threat of New Entrants Bargaining Power of Suppliers Rivalry Among Existing Competitors Threat of Substitute Products or Services Bargaining Power of Buyers

Baxter/Strategy Typical Supply Relationship Hospital Supply Closets American Hospital Supply Supplier Warehouse Supplier Supply storeroom Supplier

Baxter/Strategy AHS/Baxter Computer Link Supplier Hospital Monitor Usage data Supply Closets Deliver Supplies as needed Free space American Hospital Supply Computer Baxter Warehouse Supplier Accurate usage data Supplier

An Internet Approach for Hospital Supply Daily Auction Hospital Bid 1 Bid 2 Bid 3 <<purchase Supplier Baxter Supply Closets Internet Supplier Johnson Winning bidder delivers supplies Supplier

Strategy/Organization � Strength ◦ ◦ ◦ Source of strength Value of strength How can it be developed? What could undermine it? Development costs Additional benefits (opportunities) � Weaknesses ◦ ◦ Effect on company Possible solutions Cost of solution Result and cost of leaving as-is (do nothing)

Cloud Computing � As consumers and students, you are familiar with Web- based services. ◦ ◦ E-commerce, sales News, entertainment Communications Social networks and interaction � Businesses can use the same approaches and run software and data on Web servers with applications on laptops, tablets, and cell phones to access this data. ◦ Cloud computing consists of running the main servers, data, and business logic on Web-based servers in the Internet cloud. ◦ Each chapter explores impacts and implications for business of moving more operations into a Web-based system.

Technology Toolbox: Choosing a Search Engine General purpose search engines Consider using multiple Google, Bing, Yahoo search engines because Meta-searches across multiple engines some of them filter Dogpile responses based on your Encyclopedia prior queries. Wikipedia. org Dictionary Wiktionary. org (or click the research button in IE) Phone book Switchboard, Superpages Products Mysimon, Cnet Government data CIA. gov (World Factbook) Fedstats. gov (main data source) SEC. gov (EDGAR corporate filings) Math and Science and some Data Wolframalpha Other (and often better) Your library databases

Quick Quiz: Search Engines Where would you begin your search to answer the following questions? 1. Under the proposed IAU definition, which planetoid falls between Mars and Jupiter? 2. By revenue, which was the largest company in the world in 2010? 3. Find the best price on a 512 GB SSD. 4. Which U. S. professional basketball team had the fewest wins in the 2010 -2011 season? 5. Which celebrities are still alive? Sophia Loren, Harman Killebrew, Phyllis Diller, Nancy Reagan, I. M. Pei.

Advanced Searches Boolean searches: And/Or/Not Phrases: “white knight” 126, 000 “white knight” corporate 12, 000 “white knight” corporate –hackers –groups –Australia –resources 5, 080 “white knight” corporate merger –hackers –groups –resources 701 “white knight” corporate merger –hackers –groups –resources –history –Australia 655 You can also search by date, domain (company), linked pages, and even reading level (with Google).

Wolfram Alpha (Mathematica) http: //www. wolframalpha. com/ Search: derivative of 5*x^4 - 13*x^3 Other searches: A date A town Two stocks

Bing (Microsoft) http: //www. bing. com Organizing the results to help find answers and knowledge. http: //www. yippy. com Was: http: //www. clusty. com (Vivisimo)

Technology Toolbox: Government Data Agency Labor (BLS) Census Economic Analysis (BEA) Transportation Statistics Justice Statistics Economic Research (Ag) Main Types of Data Employment and prices Demographic and maps Economic summaries Airline, rail, and road Crime and courts Food and farm economics Health and Healthcare Business filings Health (CDC) Securities and Exchange (SEC) http: //www. fedstats. gov Site www. bls. gov/data www. census. gov www. bea. gov www. bts. gov bjs. ojp. usdoj. gov www. ers. usda. gov www. cdc. gov/nchs www. sec. gov (EDGAR)

Google: Public Data (2009) Wolfram. Alpha Search: CA unemployment rate Can use other standard statistics from government databases, including demographics.

Quick Quiz: Government Data 1. What was the U. S. monthly unemployment rate for the last year? 2. What is the current population of the U. S. ? 3. What was the value of the U. S. trade deficit for the last year?

Cases: Fast Food Industry Annual Revenue 30 25 Mc. Donald's Billion $ 20 Burger King 15 Yum Starbucks 10 Wendys 5 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Net Income / Revenue 0. 25 0. 20 Ratio 0. 15 Mc. Donald's 0. 10 Burger King 0. 05 Yum 0. 00 Starbucks -0. 05 -0. 10 -0. 15 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Wendys