Foundations of Information Systems in Business Syafrizal Helmi.
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Transcript of Foundations of Information Systems in Business Syafrizal Helmi.
Foundations Foundations of Information Systemsof Information Systems
in Businessin Business
Syafrizal HelmiSyafrizal Helmi
Explain why knowledge of information Explain why knowledge of information systems is important for business systems is important for business professionals and identify five areas of professionals and identify five areas of information systems knowledge they need.information systems knowledge they need.
Chapter ObjectivesChapter Objectives
An IS Framework for Business An IS Framework for Business ProfessionalsProfessionals
Give examples to illustrate how Give examples to illustrate how electronic business, electronic electronic business, electronic commerce, or enterprise collaboration commerce, or enterprise collaboration systems could support a firm’s systems could support a firm’s business processes, managerial business processes, managerial decision making, and strategies for decision making, and strategies for competitive advantage.competitive advantage.
Provide examples of the components of Provide examples of the components of real world information systems. real world information systems. Illustrate that in an information system, Illustrate that in an information system, people use hardware, software, data, people use hardware, software, data, and networks as resources to perform and networks as resources to perform input, processing, output, storage, and input, processing, output, storage, and control activities that transform data control activities that transform data resources into information products.resources into information products.
Chapter ObjectivesChapter Objectives
Provide examples of several major Provide examples of several major types of information systems from your types of information systems from your experiences with business experiences with business organizations in the real world.organizations in the real world.
Identify several challenges that a Identify several challenges that a business manager might face in business manager might face in managing the successful and ethical managing the successful and ethical development and use of information development and use of information technology in a business.technology in a business.
Chapter ObjectivesChapter Objectives
• Capital managementCapital management
• Foundation of doing businessFoundation of doing business
• ProductivityProductivity
• Strategic opportunity and advantageStrategic opportunity and advantage
There are four reasons why IT makes a difference to the There are four reasons why IT makes a difference to the success of a business:success of a business:
• IT is the largest single component of capital investment in the world
• The success of your business in the future may well depend on how you make IT investment decisions.
Capital Management: Capital Management:
Information Technology Capital Investment Information Technology Capital Investment
Figure 1-1
Source: Based on the data in U.S. Department of Commerce, Bureau of Economic Analysis, National Income and Product Accounts, Tables 5.2 and 5.8, 2004.
Most businesses today could not Most businesses today could not operate without extensive use of operate without extensive use of information systems and information systems and technologies. technologies.
Foundation ITFoundation IT
Using IT to Growth Using IT to Growth businessbusiness
• IT is vital to the IT is vital to the development of development of new products. new products.
IT can IT can increase increase market share.market share.
IT can help a IT can help a business become business become a high-quality, a high-quality, low-cost low-cost producerproducer
The Interdependence between Organizations andThe Interdependence between Organizations andInformation Systems Information Systems
Figure 1-2
Productivity
IT is one of the most important tools managers have to increase productivity and efficiency of businesses
IT Increase ProductivityIT Increase Productivity
Strategic Opportunity and Advantage:
Create competitive advantage: IT makes it possible to develop competitive advantages.
• Differentiate yourself from your competitors: Amazon has become the largest book retailer in the United States on the strength of its huge online inventory and recommender system. It has no rivals in size and scope.
Strategic Opportunity and Advantage:
• Create new services: eBay has developed the largest auction trading platform for millions of individuals and businesses. Competitors have not been able to imitate its success.
New Business Models: Dell Computer has built its competitive advantage on an IT enabled build-to-order business model that other firms have not been able to imitate.
1.Internet growth and technology convergence : Growth in e-business, e-commerce, and e-government, eTrade.com, making many traditional business models obsolete: the corner music store and video store.
Growing impact of IT in business firms can be assessed from the following five factors:
2. Transformation of the business enterprise : Flattening, Decentralization, Flexibility, Location independence, Low transaction and coordination costs, Empowerment, Collaborative work and teamwork
3. Growth of a globally connected economy : : Management and control in a global marketplace, Competition in world markets, Global workgroups, Global delivery systems
4. Growth of knowledge and information-base economies : Knowledge and information-based economies, New products and services, Knowledge as a central productive and strategic asset, Time-based competition, Shorter product life, Turbulent environment, Limited employee knowledge base
Emergence of the digital firm : Digitally enabled relationships with customers, suppliers, and employees, Core business processes accomplished using digital networks, Digital management of key corporate assets
InformationSystems
Resources
PeopleS
oftw
areH
ard
war
e
Networks Data
Components of an Information SystemComponents of an Information System
What is an Information What is an Information System?System?
Input ofData
Resources
Input ofData
Resources
Processing Data
Processing Data
Output ofInformation
Products
Output ofInformation
Products
Control of System PerformanceControl of System Performance
Storage of Data ResourcesStorage of Data Resources
What is a System?What is a System?
ManufacturingProcess
Input ofRaw Materials
Output ofFinished Products
Environment
Other Systems
Control byManagement
ControlSignals
ControlSignals
FeedbackSignals
FeedbackSignals
System Boundary
Components of an Information SystemComponents of an Information System
Functions of an Information System
Attributes of Information Attributes of Information QualityQuality
Information Systems Are More than Computers
Penggunaan SI secara efektif Penggunaan SI secara efektif membutuhkan pemahaman dari membutuhkan pemahaman dari organisasi, manajemen, dan IT yang organisasi, manajemen, dan IT yang membentuk sistem tersebut.membentuk sistem tersebut.
Major Roles of Information Major Roles of Information SystemsSystems
Support Strategies for
Competitive Advantage
SupportBusiness Decision Making
Support Business Processes and Operations
The Business Information Value Chain
Figure 1-7
The e-Business EnterpriseThe e-Business Enterprise
Manufacturingand
Production
Engineering &Research
Accounting,and Finance
Suppliers and Other Business Partners
Supply Chain ManagementProcurement, Distribution, and Logistics
Customer Relationship ManagementMarketing Sales Customer Service
Consumer and Business Customers
Company
Boundary
Intranets
The Internet
Extranets
Ext
ran
ets
History of the role of Information History of the role of Information SystemsSystems
Data Processing
ManagementReporting
DecisionSupport
Strategic &End User
Electronic Commerce
1950-1960 1960-1970 1970-1980 1980-1990 1990-2000
ElectronicData Processing- TPS
ManagementInformationSystems
DecisionSupportSystems- Ad hoc Reports
End UserComputingExec Info SysExpert SystemsSIS
ElectronicBusiness & Commerce-InternetworkedE-Business &Commerce
Types of Information Types of Information SystemsSystems
Transaction
Processing
Systems
Process
Control
Systems
Enterprise
Collaboration
Systems
Operations
Support
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Management
Support
Systems
Information Systems
Other Categories of Other Categories of Information SystemsInformation SystemsExpert SystemsExpert Systems
Knowledge Management SystemsKnowledge Management Systems
Functional Business SystemsFunctional Business Systems
Strategic Information SystemsStrategic Information Systems
Cross-Functional Information SystemsCross-Functional Information Systems
The Information Systems The Information Systems Development ProcessDevelopment Process
Management Challenges of the E-business Management Challenges of the E-business EnterpriseEnterprise
•Business Strategies•Business Processes•Business Needs
•Customer Relationships•Business Partners•Suppliers•Business Customers
Ethical ConsiderationsPotential Risks?Potential Laws? Possible Responses?
•IS Human Resources•IS Development
•IT Infrastructure•IS Performance
•Organization Structure•and Culture•User Acceptance
Types of Information Systems
Major Types of Systems
• Transaction Processing Systems (TPS)
• Management Information Systems (MIS)
• Decision-Support Systems (DSS)
• Executive Support Systems (ESS)
Transaction Processing Systems
(TPS)
A Symbolic Representation for a Payroll TPS
Management Information SystemsManagement Information SystemsChapter 2 Information Systems in the EnterpriseChapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Typical Applications of TPS
Management Information Systems
(MIS)
Management Information Systems (MIS)
Management level
• Inputs: High volume transaction level data
• Processing: Simple models
• Outputs: Summary reports
• Users: Middle managers
Example: Annual budgeting
Management Information Systems (MIS)
Management Information Systems (MIS) (continued)
Figure 2-6
A sample MIS report
Decision-Support Systems (DSS)
Decision-Support Systems (DSS)
Management level
• Inputs: Transaction level data
• Processing: Interactive
• Outputs: Decision analysis
• Users: Professionals, staff
Example: Contract cost analysis
Decision-Support Systems (DSS) (Continued)
Voyage-estimating decision-support system
Executive Support Systems (ESS)
EXECUTIVE SUPPORT SYSTEMS (ESS):
• Inputs: Aggregate data
• Processing: Interactive
• Outputs: Projections
• Users: Senior managers
Example: 5 year operating plan
Model of a Typical Executive Support System
Figure 2-8
Figure 2-2
Relationship of Systems to One Another
Traditional View of Systems
Enterprise Systems
Thanks for your Thanks for your AttentionAttention
Sources : Kenneth C Loudon & Jane Sources : Kenneth C Loudon & Jane P Loudon, Management Information P Loudon, Management Information System, managing the digitAL firm, System, managing the digitAL firm,