Principles of Information Systems Chapter 1 An Introduction

Principles of Information Systems Chapter 1 An Introduction to Information Systems

Principles and Learning Objectives 1. Why it is important to study and understand information systems. 2. Distinguish data from information. 3. Name the components of an information system and describe several system characteristics. 4. List the components of a computer-based information system. 5. Identify the basic types of business information systems. 6. Identify the major steps of the systems development process. 7. Describe some of the threats to security and privacy that information systems and the Internet. 2

Why Learn About Information Systems? Ø Information systems used in most professions § Sales representatives § Managers § Financial planners Ø Indispensable for achieving career goals 3

Introduction • Information system (IS) ØA set of interrelated components that collect, manipulate, and disseminate data and information, and provide feedback to meet an objective ØBusinesses § Can use information systems to increase revenues and reduce costs 4

Information Concepts Ø Information § One of an organization’s most valuable resources § Often confused with the term data 5

Data, Information, and Knowledge Ø Data § Raw facts Ø Information § Collection of facts organized in such a way that they have value beyond the facts themselves Ø Process § Set of logically related tasks Ø Knowledge § Awareness and understanding of a set of information 6

Data, Information, and Knowledge (cont’d) 7

Data, Information, and Knowledge (cont’d) 8

Data, Information, and Knowledge (cont’d) 9

The Characteristics of Valuable Information Ø If an organization’s information is not accurate or complete § People can make poor decisions, costing thousands, or even millions, of dollars Ø Depending on the type of data you need § Some characteristics become more valuable than others 10

The Value of Information Ø Directly linked to how it helps decision makers achieve their organization’s goals Ø Valuable information § Can help people and their organizations perform tasks more efficiently and effectively 11

System Concepts Ø System § Set of elements or components that interact to accomplish goals Ø Components of a system § § Inputs Processing mechanisms Outputs Feedback 12

System Concepts (cont’d) 13

System Performance and Standards Ø Efficiency § Measure of what is produced divided by what is consumed Ø Effectiveness § Extent to which system attains its goals Ø System performance standard § Specific objective of the system 14

System Performance and Standards (cont’d) 15

System Performance and Standards (cont’d) 16

What is an Information System? • Information system (IS) is a set of interrelated elements that – Collect (input), manipulate (process), store, and disseminate (output) data and information, and provide a corrective reaction (feedback mechanism) to meet an objective 17

What is an Information System? (cont’d) 18

Input, Processing, Output, Feedback Ø Input § Activity of gathering and capturing raw data Ø Processing § Converting data into useful outputs Ø Output § Production of useful information, usually in the form of documents and reports Ø Feedback § Information from the system that is used to make changes to input or processing activities 19

Manual and Computerized Information Systems Ø An information system can be: § Manual § Computerized 20

Computer-Based Information Systems Ø Single set of hardware, software, databases, telecommunications, people, and procedures § That are configured to collect, manipulate, store, and process data into information Ø Technology infrastructure § Includes all hardware, software, databases, telecommunications, people, and procedures • Configured to collect, manipulate, store, and process data into information 21

Computer-Based Information Systems (cont’d) 22

Computer-Based Information Systems (cont’d) Ø Hardware § Consists of computer equipment used to perform input, processing, and output activities Ø Software § Consists of the computer programs that govern the operation of the computer Ø Database § Organized collection of facts and information, typically consisting of two or more related data files 23

Computer-Based Information Systems (cont’d) Ø Telecommunications, networks, and the Internet § The electronic transmission of signals for communications Ø Networks § Connect computers and equipment to enable electronic communication Ø Internet § World’s largest computer network, consisting of thousands of interconnected networks, all freely exchanging information 24

Computer-Based Information Systems (cont’d) Ø People § Can be the most important element in most computer-based information systems Ø Procedures § Include strategies, policies, methods, and rules for using the CBIS 25

Business Information Systems 26

Business Information Systems (cont’d) 27

Electronic and Mobile Commerce Ø E-commerce § Any business transaction executed electronically between: • Companies (business-to-business, B 2 B) B 2 B • Companies and consumers (business-toconsumer, B 2 C) B 2 C • Consumers and other consumers (consumerto-consumer, C 2 C) C 2 C • Business and the public sector • Consumers and the public sector 28

Electronic and Mobile Commerce (cont’d) Ø Mobile commerce (m-commerce) § Transactions conducted anywhere, anytime Ø E-commerce § Can enhance a company’s stock prices and market value Ø Electronic business (e-business) § Uses information systems and the Internet to perform all business-related tasks and functions 29

Electronic and Mobile Commerce (cont’d) 30

Enterprise Systems: Transaction Processing Systems and Enterprise Resource Planning Ø Transaction § Any business-related exchange, exchange such as payments to employees and sales to customers Ø Transaction processing system (TPS) – Organized collection of people, procedures, software, databases, and devices used to record completed business transactions 31

Enterprise Systems: Transaction Processing Systems and Enterprise Resource Planning (cont’d) 32

Enterprise Resource Planning Ø Set of integrated programs that: § Manages the vital business operations for an entire multisite, global organization Ø Most systems provide integrated software to support manufacturing and finance 33

Information and Decision Support Systems Ø TPS § Can speed business activities and reduce clerical costs Ø Management information system (MIS) § Organized collection of people, procedures, software, databases, and devices that • Provides routine information to managers and decision makers 34

Information and Decision Support Systems (cont’d) 35

Information and Decision Support Systems (cont’d) Ø Decision support system (DSS) § Organized collection of people, procedures, software, databases, and devices that support problem-specific decision making § Used when problem is complex and information needed to determine appropriate action is difficult to obtain and use 36

Information and Decision Support Systems (cont’d) 37

Specialized Business Information Systems: Knowledge Management, Artificial Intelligence, Expert Systems, and Virtual Reality Ø Knowledge management systems (KMSs) § Organized collection of people, procedures, software, databases, and devices to • Create, store, share, and use the organization’s knowledge and experience Ø Artificial intelligence (AI) § Computer system takes on characteristics of human intelligence 38

Specialized Business Information Systems: Knowledge Management, Artificial Intelligence, Expert Systems, and Virtual Reality (cont’d) 39

Specialized Business Information Systems: Knowledge Management, Artificial Intelligence, Expert Systems, and Virtual Reality (cont’d) Ø Expert systems § Give computer ability to make suggestions and function like an expert in a particular field Ø Virtual reality § Simulation of a real or imagined environment that can be experienced visually in three dimensions 40

Systems Development Ø Systems development § The activity of creating or modifying existing business systems Ø Outsourcing § Allows a company to focus on what it does best and delegate other functions to companies with expertise in systems development 41

Systems Development (cont’d) 42

Systems Investigation and Analysis Ø Goal of systems investigation § To gain clear understanding of the problem to be solved or opportunity to be addressed Ø Systems analysis § Defines the problems and opportunities of the existing system 43

Systems Design, Implementation, and Maintenance and Review Ø Systems design § Determines how new system will work to meet business needs defined during systems analysis Ø Systems implementation § Acquiring various system components defined in design step, assembling them, and putting the new system into operation Ø Systems maintenance and review § Checks and modifies the system so that it continues to meet changing business needs 44

Information Systems in Society, Business, and Industry Ø Information systems § Have been developed to meet the needs of all types of organizations and people § Speed and widespread use opens users to a variety of threats from unethical people 45

Security, Privacy, and Ethical Issues in Information Systems and the Internet Ø Drawbacks of information systems § Always being connected at work and to your boss through the Internet, minimizing free time Ø To protect against threats to your privacy and data § Install security and control measures Ø Use of information systems § Raises work concerns, including job loss through increased efficiency 46

Computer and Information Systems Literacy • Computer literacy – Knowledge of computer systems and equipment and the ways they function • Information systems literacy – Knowledge of how data and information are used by individuals, groups, and organizations 47

Information Systems in the Functional Areas of Business • • • Finance and accounting Sales and marketing Manufacturing Human resource management Legal information systems 48

Information Systems in Industry • • • Airline industry Investment firms Banks Transportation industry Publishing companies 49

Information Systems in Industry (cont’d) • Healthcare organizations • Retail companies • Power management and utility companies • Professional services 50

Global Challenges in Information Systems • • • Cultural challenges Language challenges Time and distance challenges Infrastructure challenges Currency challenges 51

Global Challenges in Information Systems (cont’d) • • Product and service challenges Technology transfer issues State, regional, and national laws Trade agreements 52