MIS Chapter 1
________ are designed to support organization-wide process coordination and integration.
Enterprise applications
A fully digital firm produces only digital goods or services.
False
A hotel reservation system is a typical example of a management information system.
False
Advances in data storage have made routine violation of individual privacy more difficult.
False
An adhocracy is a knowledge-based organization where goods and services depend on the expertise and knowledge of professionals.
False
Despite the passage of several laws defining and addressing computer crime, accessing a computer system without authorization is not yet a federal crime.
False
ESSs are designed primarily to solve specific problems.
False
Enrolling employees in benefits plans is a business process handled by the finance and accounting function
False
Enrolling employees in benefits plans is a business process handled by the finance and accounting function.
False
Even in today's legal climate, there is little incentive for firms to cooperate with prosecutors investigating financial crimes at their firm.
False
In social business, firms use social networks for coordinating production tasks.
False
Knowledge workers assist with paperwork at all levels of the firm.
False
Management information systems typically support nonroutine decision making.
False
Most MISs use sophisticated mathematical models or statistical techniques.
False
Strong linkages to customers and suppliers decrease switching costs.
False
The term business ecosystem describes the interplay between the various organizational forces within a firm.
False
Transaction processing systems are most commonly used by the senior management level of an organization.
False
You would use an MIS to help decide whether to introduce a new product line.
False
information technology (IT) consists of all the hardware that a firm needs to use in order to achieve its business objectives, whereas information systems consists of all the software and business processes needed
False
Imagine that a company has developed an advanced technology that allows it to reduce its data center requirements by an unprecedented amount, and creates a competitive advantage for the company in the data center market. For what reason would the company not share that technology with other data center firms?
Firms that have developed a more effective power utilization for their data centers have a strategic advantage which therefore makes them more competitive. Sharing the strategy would be giving up the competitive advantage
Enabling management to make better decisions regarding organizing and scheduling sourcing, production, and distribution is a central feature of
SCM's
Which of the following best describes how new information systems result in legal gray areas?
They result in new situations that are not covered by old laws.
A Skype conference call using VOIP and webcams is an example of a remote, synchronous collaboration tool.
True
A firm can be said to have competitive advantage when they have higher stock market valuations than their competitors.
True
All organizations have bedrock, unassailable assumptions that define their goals and products.
True
Business processes are collections of standard operating procedures.
True
Customers are one of the competitive forces that affect an organization's ability to compete.
True
Decision-support systems use internal information as well as information from external sources.
True
Enterprise systems often include transactions with customers and vendors.
True
In a demonstration of network economics, the more people that use Adobe software and related products, the greater the value of the software.
True
In the strategy of product differentiation, information systems are used to enable new products and services.
True
In the value chain model, primary activities are most directly related to the production and distribution of the firm's products and services that create value for the customer.
True
Mass customization is a form of mass production.
True
Operational management is responsible for directing the day-to-day operations of the business and therefore needs transaction-level information.
True
Professionals take on special rights and obligations because of their special claims to knowledge, wisdom, and respect.
True
Research has shown that only 25% of firms are able to align their information technology with their business goals.
True
Shipping a product to a customer is an example of a business process.
True
Supply chain management systems are more externally oriented than enterprise systems.
True
Synchronous collaboration tools allow global firms to collaborate from different locations at the same time.
True
Technostress is a computer-related malady whose symptoms include fatigue.
True
The drawback to copyright protection is that the underlying ideas behind the work are not protected, only their reproduction in a product.
True
The effect of the Internet has been to raise bargaining power over suppliers.
True
The most common type of computer-related RSI is CTS.
True
The value chain model classifies all company activities as either primary or support.
True
an example of a business using information systems to attain operational excellence is
Wal-Mart's RetailLink system
Why can't other large retailers easily duplicate Walmart's Retail Link?
Walmart is able to off load some of the cost of keeping its shelves full to vendors. Vendors monitor the stock of their goods in all Walmart stores and are incentivized to keep goods in stock (avoid stock-outs).
The Federal Trade Commission FIP principle of Notice/Awareness states that
Web sites must disclose their information practices before collecting data.
Does the FCC support metered pricing and/or Internet bandwidth caps?
Yes, as long at the pricing reflects usage and is non-discriminatory.
An example of a collaboration tool that supports colocated, asynchronous collaboration is
a team room.
The value chain model
helps a firm identify points at which information technology can most effectively enhance its competitive position.
Psychologists study information systems with an eye to understanding
how systems affect individuals, groups, and organizations
Sociologists study information systems with an eye to understanding
how systems affect individuals, groups, and organizations.
Which main business function is responsible for maintaining employee records?
human resources
In environmental scanning, a firm may use information systems to
identify external events that may affect it.
All of the following are direct business benefits of collaboration except for
improved compliance with government regulations.
Verizon's implementation of a Web-based digital dashboard to provide managers with real-time information such as customer complaints is an example of
improved decision making
The six important business objectives of information technology are new products, services, and business models; customer and supplier intimacy; survival; competitive advantage; operational excellence; and
improved decision making.
The primary activities of a firm include
inbound logistics, operations, outbound logistics, sales and marketing, and service.
All of the following are current key technology trends raising ethical issues except
increase in multimedia quality.
Organizational culture is best described by which of the following statements
it is a set of assumptions and values accepted by most members
It is not feasible for companies to produce error-free software because
it is too expensive to create perfect software.
Engineers, scientists, or architects, who design new products or services for a firm, belong to which level of a business hierarchy?
knowledge workers
Executive support systems are information systems that support the
long-range planning activities of senior management.
Amazon's use of the Internet as a platform to sell books more efficiently than traditional bookstores illustrates a use of information services for
low-cost leadership.
The four major types of competitive strategy are
low-cost leadership; product differentiation; focus on market niche; and customer and supplier intimacy.
The Internet raises the bargaining power of customers by
making information available to everyone.
the field that deals with behavioral issues as well as technical issues surrounding the development, use, and impact of information system used by managers and employees in the firm is called
management information systems
A relocation control system that reports summaries on the total moving, house hunting, and home financing costs for employees in all company divisions would fall into the category of
management information systems.
Producing bills of materials is a business process within the ________ function.
manufacturing and production
When a firm provides a specialized product or service for a narrow target market better than competitors, they are using a ________ strategy.
market niche
According to the ________ definition of organizations, an organization is seen as a means by which primary production factors are transformed into outputs consumed by the environment.
microeconomic
The term "management information systems" designates a specific category of information systems serving
middle management functions.
A firm can exercise greater control over its suppliers by having
more suppliers.
FIP principles are based on the notion of the
mutuality of interest between the record holder and the individual
A manufacturer of deep-sea oil rigs may be least concerned about this marketplace force.
new market entrants
When a cookie is created during a Web site visit, it is stored
on the visitor's computer.
Converting raw data into a more meaningful form is called:
processing
converting raw data into a more meaningful form is called
processing
which of the following roles in a firm would be least affected by mobile devices to access firm information systems
production workers
Mintzberg's classification of organizational structure categorizes the knowledge-based organization where goods and services depend on the expertise and knowledge of professionals as a(n)
professional bureaucracy.
In the information age, the obligations that individuals and organizations have regarding the preservation of existing values and institutions fall within the moral dimension of
quality of life
order data for baseball tickets and bar code data are examples of
raw input
Which of the following is not one of the four main classifications for collaboration tools identified by the space/time matrix?
remote/colocated
an example of a business using information systems to attain operational excellence is
the Mandarin oriental hotel's customer-preference tracking system
"Look and feel" copyright infringement lawsuits are concerned with
the distinction between an idea and its expression.
Thomas Friedman's declaration that the world was now "flat" meant that
the internet has reduced the economic advantages of developed countries
The more any given resource is applied to production, the lower the marginal gain in output, until a point is reached where the additional inputs produce no additional output. This is referred to as
the law of diminishing returns.
Which of the following is not one of the reasons for the increased business focus on collaboration and teamwork?
the need for more efficient work hierarchies
which of the following constitutes an organizational element in the UPS tracking system described in the chapter
this specification of procedures for identifying packages with sender and recipient information
What triggers Walmart's Retail Link system to ship goods to local Walmart Stores?
consumer purchases in local stores by point-of-purchase cash register data
Which of the following is an example of a cross-functional business process?
creating a new product
The fundamental set of assumptions, values, and ways of doing things that has been accepted by most of a company's members is called its:
culture
As discussed in the chapter opening case, which of the four generic strategies did Sears employ to combat the competition offered by Target, Walmart, and Macy's?
customer and supplier intimacy
Telus's use of SharePoint for team sites is an example of using information systems to achieve which business objective?
customer and supplier intimacy
The most common source of business system failure is
data quality.
which of the following choices may lead to competitive advantage: 1. new products, services, and business models; 2. charging less for superior products; 3. responding to customers in real time
1, 2, and 3
The word "partnership" appears several times in the video. Who are the NBA's partners? How does the concept of a strategic ecosystem help understand the NBA's partnership strategies?
Both of the above.
What is the NBA market situation as determined from the Video Case?
Both of the first two answers are correct.
Which types of systems consolidate the relevant knowledge and experience in the firm to make it available to improve business processes and management decision making?
KMS
The most successful solutions or methods for achieving a business objective are called
best practices.
How much of the world's global greenhouse gases are the result of computing?
2% of the global greenhouse gas emissions
Which of the following best illustrates the use of information systems to focus on market niche?
A department store creating specialized products for small groups of customers.
which of the following are key corporate assets
A) intellectual property, core competencies, and financial and human assets
Why is it important that individual franchise owners can build, manage, and distribute on the NBA platform their own content?
All of the above.
An example of a business using information systems to create new products and services is
Apple Inc.'s iPod
An example of a keystone firm within a business ecosystem is
Apple and software application writers in the mobile platform ecosystem.
What reason below would support being in favor of network neutrality going forward?
Both of the above
survival
Businesses may need to invest in information systems out of necessity; simply the cost of doing business Keeping up with competitors Citibank's introduction of A T Ms Federal and state regulations and reporting requirements Toxic Substances Control Act and the Sarbanes-Oxley Act
A ________ is a senior manager who oversees the use of IT in the firm.
CIO
The ________ helps design programs and systems to find new sources of knowledge or to make better use of existing knowledge in organizational and management processes.
CKO
________ systems are designed to help firms manage their relationships with their customers.
CRM
Should the government or an industry association regulate the carbon emissions of the data center industry as they do the airline industry?
Currently, in the United States, there has been no call for data center power regulation by government, in part because data centers are seen as a small component in the total picture of greenhouse gas emissions
Which type of system would you use to forecast the return on investment if you used new suppliers with better delivery track records?
DSS
________ systems are especially suited to situations in which the procedure for arriving at a solution may not be fully defined in advance.
Decision-support
What do the FCC and industry critics mean by "discriminatory behavior" towards selected Internet services?
Discrimination occurs when an ISP prevents certain types of files from being carried, or slows down the transmission of selected files for whatever reason.
Which type of system would you use to determine what trends in your supplier's industry will affect your firm the most in five years?
ESS
Why is it important that all fans in the world have the same experience?
For the NBA and other professional sports businesses in the United States the fastest growing markets are global, led by China, Europe, and Latin America. Offering lower quality service to your fastest growing markets would inhibit global growth.
An example of a divisionalized bureaucracy is a
Fortune 500 firm.
The emergence, for Amazon.com, of new competitors in the sphere of online shopping illustrates what disadvantage posed by the use of information systems to achieve competitive advantage?
Internet technologies are universal, and therefore usable by all companies.
All of the following statements regarding Lotus Notes are true except which one?
It began as an e-mail and messaging client.
Which of the following statements is not true about information technology's impacts on business firms?
It helps firms expand in size.
How does the technical view of organizations fall short of understanding the full impacts of information systems in a firm?
It sees the inputs and outputs, labor and capital, as being infinitely malleable.
An example of synergy in business is
JP Morgan Chase's mergers with other banks that provided JP Morgan with a network of retail branches in new regions.
A colleague of yours frequently takes for his own personal use small amounts of office supplies, noting that the loss to the company is minimal. You counter that if everyone were to take the office supplies, the loss would no longer be minimal. Your rationale expresses which historical ethical principle?
Kant's Categorical Imperative
Which type of system would you use to determine the five suppliers with the worst record in delivering goods on time?
MIS
which of the below are included in the five methods recommended by Google for reducing power consumption
Manage airflow by isolating cool aisles from hot aisles Make use of free ambient cooling such as cooler air, or cooler incoming water Optimize power distribution and utilization
________ is the ability to offer individually tailored products or services using the same production resources as bulk production.
Mass customization
what is PUE
PUE stands for "power usage effectiveness"
Is there a danger of vendors overstocking Walmart shelves by virtue of using Retail Link and empowering vendors?
Probably. But Walmart's own managers oversee the inventory system and can quickly spot those vendors who would take advantage of their access to Retail Link.
The "do anything anywhere" computing environment can
blur the traditional boundaries between work and family time.
Using Porter's competitive forces model, which competitive force is most closely relative to the case as described in the video and the accompanying text?
Substitute Products
________ systems integrate supplier, manufacturer, distributor, and customer logistics processes.
Supply-chain management
Which type of system would you use to change a production schedule if a key supplier was late in delivering goods?
TPS
You have been hired by a worldwide non-profit agency to implement a system to handle their donations. The system must be able to handle and record telephone, sms, and Internet donations, provide up-to-the-minute reports, and create highly customizable mailing lists. In addition, event fundraisers need to be able to quickly access a donor's information and history. Which of the following systems will best meet these needs?
TPS with MIS capabilities
All of the following are advantages, for a firm, of cloud computing except
ability to improve communication.
A classic ethical dilemma is the hypothetical case of a man stealing from a grocery store in order to feed his starving family. If you used the Utilitarian Principle to evaluate this situation, you might argue that stealing the food is
acceptable, because the higher value is the survival of the family.
The feature of social institutions that means mechanisms are in place to determine responsibility for an action is called
accountability.
Apple Computer dominates the online legal music sales industry primarily because of a failure of recording label companies to
adopt a new business model
All of the following are major features of organizations that impact the use of information systems except for
agency costs.
Which of the following activities would you perform to measure and compare your business processes to similar processes of other companies within your industry?
benchmarking
Major cities of the world have adopted "congestion pricing" in which cars pay a toll to enter the core of the city during daylight hours. Congestion pricing is also used to regulate demand by businesses for electricity. During the day when electricity is in high demand, many businesses pay a "demand" fee in addition to the regular charge for electricity. Why is the Internet any different?
both of the above
How are information systems used at the industry level to achieve strategic advantage?
by building industry-wide, IT-supported consortia and symposia
The interaction between information systems and organizations is influenced
by many factors, including structure, politics, culture, and environment.
Flash cookies are different from ordinary cookies in that they
cannot be easily detected or deleted.
Which of the following would not be a complementary asset for a solar panel manufacturer?
centralized hierarchical decision making
Which of the following industries has not been disrupted by the Internet?
clothing
Dell Computer's use of information systems to improve efficiency and implement "mass customization" techniques to maintain consistent profitability and an industry lead illustrates which business objective?
competitive advantage
which of the following is not one of the current changes taking place in information systems technology
development of videopresence software
which of the following is not one of the current changes taking place in information systems technology?
development of videopresence software
Walmart's Retail Link is
driven by consumer behavior which "pulls" replacement stock from inventory.
Why is a detailed knowledge of consumer purchases at each store important to Walmart's success?
each store is in reality a unique entity with its own patterns of consumption
What is the most important function of an enterprise application?
enabling business functions and departments to share information
An information system can enhance core competencies by
encouraging the sharing of knowledge across business units.
The CPO is responsible for
ensuring that the company complies with existing data privacy laws.
A(n) ________ system collects data from various key business processes and stores the data in a single, comprehensive data repository, usable by other parts of the business.
enterprise
Enterprise systems are also known as ________ systems.
enterprise resource planning
The four major enterprise applications are
enterprise systems, SCMs, CRMs, and KMSs.
The ethical "no free lunch" rule states that
everything is owned by someone else, and that the creator wants compensation for this work.
Which systems often deliver information to senior executives through a portal, which uses a Web interface to present integrated personalized business content?
executive support systems
Studies have consistently shown that firms that invest greater amounts in information technology receive greater benefits than firms that invest less
false
business processes are logically related tasks for accomplishing tasks that have been formally encoded by an organization
false
there are four major business functions; sales and marketing; manufacturing and production; finance and accounting; and information technology
false
Maintaining the organization's financial records is a central purpose of which main business function?
finance and accounting
Which of the following would not be considered a disruptive technology?
instant messaging
An information system can enable a company to focus on a market niche through
intensive customer data analysis.
Which of the following industries has a low barrier to entry?
restaurant
Business processes are collections of
routines.
Identifying customers is a responsibility of the ________ function.
sales and marketing
which of the following is not one of the primary environmental actors that interacts with an organization and its information systems
sales force
A substitute product of most concern for a cable TV distributor is
satellite TV.
Network economics
sees the cost of adding new members as inconsequential.
ESS are specifically designed to serve which level of the organization?
senior management
the three principle levels within a business organization hierarchy are
senior management, middle management, and operational management
In general, it is very difficult to hold software producers liable for their software products when those products are considered to be
similar to books.
data management technology consists of the
software governing the organization of data on physical storage media
Data management technology consists of the
software governing the organization of data on physical storage media.
An organization is a
stable, formal social structure that takes resources from the environment and processes them to produce outputs, formal, legal entity with internal rules and procedures that must abide by laws, and collection of social elements
What significant competitive force is challenging the publishing industry?
substitute products or services
A firm that must invest in new information systems capabilities in order to comply with federal legislation can be said to be investing to achieve which business objective?
survival
the move of retail banking to use ATMs are Citibank unveiled its first ATMs illustrates the use of information systems to achieve which business objective
survival
the temp agency that you own is having serious difficulties placing temps because few of them are familiar with internet research. Investing in training software to enhance your worker's skills is an example of using technology to achieve which business objective?
survival
The principal liaison between the information systems groups and the rest of the organization is a(n)
systems analyst.
According to Leavitt's model of organizational resistance, the four components that must be changed in an organization in order to successfully implement a new information system are
tasks, technology, people, and structure.
Which of the following is one of the support activities in a firm's value chain?
technology
As described in the chapter case, the competitive force of ________ resulted in Starbuck's downturn in 2008, and it employed information systems in a strategy of ________ to combat this force.
traditional competitors; product differentiation
an example of a social complementary asset is
training programs
Which systems are typically a major source of data for other systems?
transaction processing systems
Computers are only part of an information system.
true
ESSs draw summarized information from internal MIS and DSS.
true
MIS job growth is projected to be 50% greater than other jobs in the next five years.
true
Studies have consistently shown that firms who invest greater amounts in information technology receive greater benefits than firms that invest less.
true
The competitive forces model can be used to analyze today's digital firm as well as traditional firms.
true
The idea driving synergies is that when the output of some units can be used as inputs to other units, the relationship can lower cost and generate profits.
true
UPS's use of Web-based tools that allow customers to embed UPS functions, such as tracking and cost calculations, into their own Web sites was an information systems solution used to achieve customer intimacy.
true
a business model describes how a company produces, delivers, and sells a product or service to create wealth
true
internet advertising is growing by more than 20 percent a year
true
the behavioral approach to information systems leaves aside technical solutions to instead analyze the psychological, social, and economic impacts of systems
true
the dimensions of information systems are management, organizations, and information technology
true
A virtual company
uses the capabilities of other companies without being physically tied to those companies.
an example of an organizational complementary asset is
using the appropriate business model
A collection of independent firms that use information technology to coordinate their value chains to produce a product or service for a market collectively is called a(n)
value web.
Building a Collaborative Culture and Business Processes
•"Command and control" organizations -No value placed on teamwork or lower-level participation in decisions •Collaborative business culture -Senior managers rely on teams of employees -Policies, products, designs, processes, and systems rely on teams The managers purpose is to build teams
Intranets and Extranets
•Also used to increase integration and expedite the flow of information •Intranets -Internal company websites accessible only by employees •Extranets -Company websites accessible externally only to vendors and suppliers -Often used to coordinate supply chain
Complementary Assets: Organizational Capital and the Right Business Model
•Assets required to derive value from a primary investment •Firms supporting technology investments with investment in complementary assets receive superior returns •Example: Invest in technology and the people to make it work properly •Complementary assets:::::::::::::::: -Examples of organizational assets §Appropriate business model §Efficient business processes -Examples of managerial assets §Incentives for management innovation §Teamwork and collaborative work environments -Examples of social assets §The Internet and telecommunications infrastructure §Technology standards
behavioral approach
•Behavioral issues (strategic business integration, implementation, etc.) •Psychology, economics, sociology
PCL Construction: The New Digital Firm
•Business Challenges -Widespread operations -Paper intensive processes •Solutions -Mobile devices -Touch screen kiosks -Microsoft Azure Cloud -Virtual design and project management Analytics dashboard •Illustrates how information technology has changed how PCL runs its business •Demonstrates I T's role in redesigning jobs and business processes •Illustrates the potential for technology to improve operational efficiency and customer experience
Business Processes
•Business processes -Flows of material, information, knowledge -Sets of activities, steps -May be tied to functional area or be cross-functional •Businesses: Can be seen as collection of business processes •Business processes may be assets or liabilitiess •Examples of functional business processes -Manufacturing and production ▪Assembling the product -Sales and marketing ▪Identifying customers -Finance and accounting ▪Creating financial statements -Human resources Hiring employees
What is Collaboration?
•Collaboration -Short lived or long term -Informal or formal (teams) •Growing importance of collaboration -Changing nature of work -Growth of professional work—"interaction jobs" -Changing organization of the firm -Changing scope of the firm -Emphasis on innovation Changing culture of work
Enterprise Systems
•Collect data from different firm functions and store data in single central data repository •Resolve problems of fragmented data •Enable: -Coordination of daily activities -Efficient response to customer orders (production, inventory) -Decision making by managers about daily operations and longer-term planning
Dimensions of Information Systems: Technology
•Computer hardware and software •Data management technology •Networking and telecommunications technology -Networks, the Internet, intranets and extranets, World Wide Web •I T infrastructure: provides platform that system is built on
Customer and Supplier Intimacy
•Customers who are served well become repeat customers who purchase more -Example: Mandarin Oriental Hotel -Uses I T to foster an intimate relationship with its customers, keeping track of preferences, etc. •Close relationships with suppliers result in lower costs -Examples: Mandarin Oriental Hotel and J C Penney (in text) -J C Penney uses I T to enhance relationship with supplier in Hong Kong
E-Business, E-Commerce, and E-Government
•E-business -Use of digital technology and Internet to drive major business processes •E-commerce -Subset of e-business -Buying and selling goods and services through Internet •E-government -Using Internet technology to deliver information and services to citizens, employees, and businesses
Tools and Technologies for Collaboration and Social Business
•E-mail and instant messaging (I M) •Wikis •Virtual worlds •Collaboration and social business platforms -Virtual meeting systems (telepresence) -Cloud collaboration services (Google Drive, Google Docs, etc.) -Microsoft SharePoint and I B M Notes Enterprise social networking tools
Technical Approach
•Emphasizes mathematically based models •Computer science, management science, operations research
Strategic Business Objectives of Information Systems
•Growing interdependence between: -Ability to use information technology -Ability to implement corporate strategies and achieve corporate goals •Firms invest heavily in information systems to achieve six strategic business objectives: 1.Operational excellence 2.New products, services, and business models 3.Customer and supplier intimacy 4.Improved decision making 5.Competitive advantage Survival
Dimensions of Information Systems: Organizations
•Hierarchy of authority, responsibility -Senior management -Middle management -Operational management -Knowledge workers -Data workers Production or service workers •Separation of business functions -Sales and marketing -Human resources -Finance and accounting -Manufacturing and production •Unique business processes •Unique business culture Organizational politics
What's New in Management Information Systems
•I T Innovations -Cloud computing, big data, Internet of Things -Mobile digital platform -AI and machine learning •New Business Models -Online streaming music and video -On-demand e-commerce services •E-commerce Expansion -E-commerce expands to nearly $1 trillion in 2018 -Netflix now has more than 125 million U S subscribers -Online services now approach online retail in revenue -Online mobile advertising now larger than desktop • Management Changes -Managers use social networks, collaboration tools -Business intelligence applications accelerate -Virtual meetings proliferate •Firms and Organizations Change -More collaborative, less emphasis on hierarchy and structure -Greater emphasis on competencies and skills -Higher-speed/more accurate decision making based on data and analysis -More willingness to interact with consumers (social media) Better understanding of the importance of I T
Organizing the Information Systems Function
•I T governance -Strategies and policies for using I T in the organization -Decision rights -Accountability -Organization of information systems function Centralized, decentralized, and so on
Operational Excellence
•Improved efficiency results in higher profits •Information systems and technologies help improve efficiency and productivity •Example: Walmart -Power of combining information systems and best business practices to achieve operational efficiency—and over $485 billion in sales in 2017 -Most efficient retail store in world as result of digital links between suppliers and stores
How Information Systems Are Transforming Business
•In 2017, more than 140 million businesses had dot-com addresses registered •273 million adult Americans online; 190 million purchased online •269 million Americans have mobile phones •200 million use social networks •Social networking tools being used by businesses to connect employees, customers, and managers •Internet advertising continues to grow at more than 20 percent per year •New laws require businesses to store more data for longer periods •Changes in business result in changes in jobs and careers
The Emerging Digital Firm
•In a fully digital firm: -Significant business relationships are digitally enabled and mediated -Core business processes are accomplished through digital networks -Key corporate assets are managed digitally •Digital firms offer greater flexibility in organization and management Time shifting, space shifting
How Information Technology Improves Business Processes
•Increasing efficiency of existing processes -Automating steps that were manual •Enabling entirely new processes -Changing flow of information -Replacing sequential steps with parallel steps -Eliminating delays in decision making -Supporting new business models
It Isn't Just Technology: A Business Perspective on Information Systems
•Information system is instrument for creating value •Investments in information technology will result in superior returns -Productivity increases -Revenue increases Superior long-term strategic positioning •Business information value chain -Raw data acquired and transformed through stages that add value to that information -Value of information system determined in part by extent to which it leads to better decisions, greater efficiency, and higher profits •Business perspective -Calls attention to organizational and managerial nature of information systems •Investing in information technology does not guarantee good returns •There is considerable variation in the returns firms receive from systems investments •Factors -Adopting the right business model -Investing in complementary assets (organizational and management capital)
New Products, Services, and Business Models
•Information systems and technologies enable firms to create new products, services, and business models •Business model: how a company produces, delivers, and sells its products and services •Example: Apple -Transformed old model of music distribution with iTunes Constant innovations—iPod, iPhone, iPad, etc.
What Is an Information System?
•Information technology: the hardware and software a business uses to achieve objectives •Information system: interrelated components that manage information to: -Support decision making and control -Help with analysis, visualization, and product creation •Data: streams of raw facts •Information: data shaped into meaningful, useful form •Activities in an information system that produce information: -Input -Processing -Output -Feedback •Sharp distinction between computer or computer program versus information system •Feedback -Output is returned to appropriate members of organization to help evaluate or correct input stage •Computer/computer program vs. information system -Computers and software are technical foundation and tools, similar to the material and tools used to build a house
Globalization Challenges and Opportunities: A Flattened World
•Internet and global communications have greatly changed how and where business is done -Drastic reduction of costs of operating and transacting on global scale -Competition for jobs, markets, resources, ideas Growing interdependence of global economies -Requires new understandings of skills, markets, opportunities -Challenges yes, but opportunities as well -Over half of the revenue of S&P 500 US firms is generated off shore -Information systems enable globalization of commerce
Business Benefits of Collaboration and Teamwork
•Investments in collaboration technology can bring organization improvements, returning high R O I •Benefits -Productivity -Quality -Innovation -Customer service -Financial performance ▪Profitability, sales, sales growth
Supply Chain Management (SCM) Systems
•Manage firm's relationships with suppliers •Share information about: -Orders, production, inventory levels, delivery of products and services •Goal: -Right amount of products to destination with least amount of time and lowest cost
Approach of This Text: Sociotechnical Systems
•Management information systems -Combine computer science, management science, operations research, and practical orientation with behavioral issues •Four main actors -Suppliers of hardware and software -Business firms -Managers and employees -Firm's environment (legal, social, cultural context) •Sociotechnical view -Optimal organizational performance achieved by jointly optimizing both social and technical systems used in production -Helps avoid purely technological approach
Dimensions of Information Systems: Management
•Managers set organizational strategy for responding to business challenges •In addition, managers must act creatively -Creation of new products and services -Occasionally re-creating the organization
The Information Systems Department
•Often headed by chief information officer (C I O) -Other senior positions include chief security officer (C S O), chief knowledge officer (C K O), chief privacy officer (C P O), chief data officer (C D O) •Programmers •Systems analysts •Information systems managers •End users
Competitive Advantage
•Often results from achieving previous business objectives •Advantages over competitors •Charging less for superior products, better performance, and better response to suppliers and customers •Examples: Apple, Walmart, U P S are industry leaders because they know how to use information systems for this purpose
Dimensions of U P S Tracking System
•Organizational -Procedures for tracking packages and managing inventory and provide information •Management -Monitoring service levels and costs •Technology -Handheld computers, bar-code scanners, networks, desktop computers, and so on
Dimensions of Information Systems
•Organizations •Management Technology
Enterprise Social Networking Helps A B B Innovate and Grow
•Problem -Outdated static technology -Geographically dispersed •Solutions -Develop knowledge sharing strategy and goals -Change knowledge and collaboration processes -Change organizational culture -Deploy Inside+, with Yammer, Office 365, and Sharepoint •A B B uses Inside+ to provide new channels for knowledge acquisition, innovation, and collaboration •Demonstrates I T's role in helping organizations improve performance and remain competitive •Illustrates the ability of I T systems to support collaboration and teamwork
Customer Relationship Management (C R M) Systems
•Provide information to coordinate all of the business processes that deal with customers -Sales -Marketing -Customer service •Helps firms identify, attract, and retain most profitable customers
Management Information Systems
•Serve middle management •Provide reports on firm's current performance, based on data from T P S •Provide answers to routine questions with predefined procedure for answering them •Typically have little analytic capability
Decision Support Systems
•Serve middle management •Support nonroutine decision making -Example: What is the impact on production schedule if December sales doubled? •May use external information as well T P S / M I S data •Model driven D S S -Voyage-estimating systems •Data driven D S S Intrawest's marketing analysis systems
What is Social Business?
•Social business -Use of social networking platforms (internal and external) to engage employees, customers, and suppliers •Aims to deepen interactions and expedite information sharing •"Conversations" •Requires information transparency -Driving the exchange of information without intervention from executives or others
Knowledge Management Systems (K M S)
•Support processes for capturing and applying knowledge and expertise -How to create, produce, and deliver products and services •Collect internal knowledge and experience within firm and make it available to employees •Link to external sources of knowledge
Executive Support Systems
•Support senior management •Address nonroutine decisions -Requiring judgment, evaluation, and insight •Incorporate data about external events (e.g., new tax laws or competitors) as well as summarized information from internal M I S and D S S •Example: Digital dashboard with real-time view of firm's financial performance
Enterprise Applications
•Systems for linking the enterprise •Span functional areas •Execute business processes across the firm •Include all levels of management •Four major applications -Enterprise systems -Supply chain management systems -Customer relationship management systems -Knowledge management systems
Checklist for Managers: Evaluating and Selecting Collaboration and Social Software Tools
•Time/space matrix •Six steps in evaluating software tools -Identify your firm's collaboration challenges -Identify what kinds of solutions are available -Analyze available products' cost and benefits -Evaluate security risks -Consult users for implementation and training issues -Evaluate product vendors
Systems for Different Management Groups
•Transaction processing systems -Serve operational managers and staff -Perform and record daily routine transactions necessary to conduct business ▪Examples: sales order entry, payroll, shipping -Allow managers to monitor status of operations and relations with external environment -Serve predefined, structured goals and decision making •Systems for business intelligence -Data and software tools for organizing and analyzing data -Used to help managers and users make improved decisions •Management information systems •Decision support systems •Executive support systems
Improved Decision Making
•Without accurate information: -Managers must use forecasts, best guesses, luck -Results in: §Overproduction, underproduction §Misallocation of resources Poor response times •Poor outcomes raise costs, lose customers •Real-time data improves ability of managers to make decisions. •Example: Verizon's web-based digital dashboard to provide managers with real-time data on customer complaints, network performance, line outages, etc.