Chapter 1 - Business Driven Technology

Management Information Systems (MIS)

A business function, like accounting and human resources, which moves information about people, products, and processes across the company to facilitate decision-making and problem-solving

1.3 Explain systems thinking and how management information systems enable business communications.

A system is a collection of parts that link to achieve a common purpose. Systems thinking is a way of monitoring the entire system by viewing multiple inputs being processed or transformed to produce outputs while continuously gathering feedback on each part. Feedback is information that returns to its original transmitter (input, transform, or output) and modifies the transmitter's actions. Feedback helps the system maintain stability. Management information systems (MIS) is a business func- tion, like accounting and human resources, which moves information about people, products, and processes across the company to facilitate decision making and problem solving. MIS incorporates systems thinking to help companies operate cross-functionally. For example, to fulfill product orders, an MIS for sales moves a single customer order across all functional areas, including sales, order fulfillment, shipping, billing, and finally customer service. Although different functional areas handle different parts of the sale, thanks to MIS, to the customer the sale is one continuous process.

information

Data converted into a meaningful and useful context

Knowledge

Skills, experience, and expertise coupled with information and intelligence that creates a person's intellectual resources

1.1 Describe the information age and the differences among data, information, business intelligence and knowledge.

We live in the information age, when infinite quantities of facts are widely available to anyone who can use a computer. The core drivers of the information age include data, information, business intelligence, and knowledge. Data are raw facts that describe the characteristics of an event or object. Information is data converted into a meaningful and useful context. Business Intelligence (BI) is information collected from multiple sources such as suppliers, customers, competitors, partners, and industries that analyzes patterns, trends, and relationships for strategic decision making. Knowledge includes the skills, experience, and expertise, coupled with information and intelligence, that create a person's intellectual resources. As you move from data to knowledge, you include more and more variables for analysis, resulting in better, more precise support for decision making and problem solving.

big data

a collection of large, complex data sets, including structured and unstructured data, which cannot be analyzed using traditional database methods and tools

system

a collection of parts that link to achieve a common purpose

variable

a data characteristic that stands for a value that changes or varies over time

report

a document containing data organized in a table, matrix, or graphical format allowing users to easily comprehend and understand information

business unit

a segment of a company (such as accounting, production, marketing) representing a specific business function

snapshot

a view of data at a particular moment in time

systems thinking

a way of monitoring the entire system by viewing multiple inputs being processed or transformed to produce outputs while continuously gathering feedback on each part

Internet of Things (IoT)

a world where interconnected Internet-enabled devices or "things" have the ability to collect and share data without human intervention. Another term commonly associated with The Internet of things is machine-to-machine (M2M)

dynamic reports

changes automatically during creation

Machine-generated data

created by a machine without human intervention

Human-generated data

data that humans, in interaction with computers, generate

Predictive Analytics

extracts information from data and uses it to predict future trends and identify behavioral patterns

structured data

has a defined length, type and format and includes numbers, dates, or strings such as Customer Address

Knowledge workers

individuals valued for their ability to interpret and analyze information

feedback

information that returns to its original transmitter (input, transform, or output) and modifies the transmitter's actions

static reports

is created once based on a data that does not change

Business Intelligence (BI)

is information collected from multiple sources such as suppliers, customers, competitors, partners, and industries that analyzes patterns, trends, and relationships for strategic decision making.

unstructured data

is not defined, does not follow a specified format, and is typically free-form text such as emails, Twitter tweets, and text messages (Unstructured data accounts for about 80 percent of the data that surrounds us)

goods

material items or products that customers will buy to satisfy a want or need

information silo

occurs when one business unit is unable to freely communicate with other business units making it difficult or impossible for organizations to work cross-functionally

data

raw facts that describe the characteristics of an event or object

machine-to-machine

refers to devices that connect directly to other devices

services

tasks performed by people that customers will buy to satisfy a want or need

fact

the confirmation or validation of an event or object

production

the process where a business takes raw materials and processes them or converts them into a finished product for its goods or services

productivity

the rate at which goods and services are producted based on total output given total inputs

Analytics

the science of fact-based decision making

Behavioral analytics

uses data about people's behaviors to understand intent and predict future actions

information age

when infinite quantities of facts are widely available to anyone who can use a computer

1.2 Identify the different departments in a company and why they must work together to achieve success.

■ Accounting: Records, measures, and reports monetary transactions. ■ Finance: Deals with strategic financial issues including money, banking, credit, investments, and assets. ■ Human resources: Maintains policies, plans, and procedures for the effective management of employees. ■ Marketing: Supports sales by planning, pricing, and promoting goods or services. ■ Operations management: Manages the process of converting or transforming resources into goods or services. ■ Sales: Performs the function of selling goods or services. It is easy to see how a business decision made by one department can affect other departments. Marketing needs to analyze production and sales data to come up with product promotions and advertising strategies. Production needs to understand sales forecasts to determine the company's manufacturing needs. Sales needs to rely on information from operations to understand inventory, place orders, and forecast consumer demand. All departments need to understand the accounting and finance departments' information for budgeting. For the firm to be successful, all departments must work together as a single unit sharing common information and not operate independently or in a silo.