Chapter 1: Business Information Systems In Your Career

Business Objectives of Information Systems

1. Operational excellence 2. new products, services and business models 3. Customer and supplier intimacy 4. improved decision making 5. competitive advantage 6. survival.

Problem-Solving Process Model

1. Problem Identification 2. Solution design 3. Solution evaluation and choice 4. Implementation

Solution Evaluation and Choice

Factors to consider are: - The cost of the solution - the feasibility of the solution given existing resources and skills - The length of time required to build and implement the solution Buy-in by employees and managers is extremely important

Dimensions of Information Systems

Using information systems effectively requires an understanding of the organization, people, and information technology shaping the systems. An information system provides a solution to important business problems or challenges facing the firm.

The Importance of Critical Thinking in Problem Solving

Without critical thinking, it is easy to jump to conclusions, misjudge a problem and waste resources

Information systems literacy

includes behavioral and technical approach

Information technology

the hardware and software a business uses to achieve its objectives

Information Systems

consist of interrelated components (people, technology, business processes) working together to collect, process, store, and disseminate information to support decision making, coordination, control, analysis, and visualization in an organization.

Survival

- Businesses may need to invest in information systems out of necessity - Necessity arises from keeping up with competitors - Necessity also arises from federal and state regulations Example: - When Citibank introduced ATMs - the Toxic Substances Control Act and the Sarbanes- Oxley Act

Competitive advantage

- Achieving the previously mentioned business objectives often leads to competitive advantage - Advantages over competitors include charging less for superior products, better performance, and better response to suppliers and customers Example: - Apple, Walmart, and UPS are industry leaders because they know how to use information systems to create a competitive advantage.

Implementation

- Building or purchasing solution - Testing solution, employee training - Change management - Measurement of outcomes - Feedback, evaluation of solution Problem solving is a continuous process, not a single event. - Sometimes chosen solution doesn't work or needs adjustment

Improved decision making

- A company's bottom line can be hurt by managers being swamped with data that are neither timely nor helpful, forcing them to use guesswork - Real-time data have improved the ability of managers to make decisions Example: - Verizon uses a Web-based digital dashboard to update managers with real-time data on customer complaints, network performance, and line outages

Customer and supplier intimacy

- Customers who are served well become repeat customers who purchase more - Close relationships with suppliers result in lower costs Example: - The Mandarin Oriental in Manhattan uses IS to create an intimate relationship with its customers, including keeping track of their preferences - JCPenney uses information systems to enhance its relationship with its supplier in Hong Kong

Management information systems

- Focuses on broader information systems literacy - Issues surrounding development, use, impact of information systems used by managers and employees

People

- Information systems are useless without skilled people to build, maintain, and use/understand them - Employee attitudes affect ability to use systems productively.

Activities in an information system that produce information:

- Input: captures raw data - Processing: converts raw input into meaningful form - Output: transfers processed information to those people or activities for which it is needed

The Problem-Solving Approach: Typical technology problems

- Insufficient or aging hardware - Outdated software - Inadequate database capacity - Insufficient telecommunications capacity - Incompatibility of old systems with new technology - Rapid technological change

The Problem-Solving Approach: Typical people problems

- Lack of employee training - Difficulties of evaluating performance - Legal and regulatory compliance - Work environment, ergonomics - Poor or indecisive management - Lack of employee support and participation

The Problem-Solving Approach: Typical organizational problems

- Outdated business processes - Unsupportive culture and attitudes - Political in-fighting - Turbulent business environment, change - Complexity of task - Inadequate resources

Organizations

- Technology changes organizations and vise versa - Must know something about the structure, history, and culture of the organization in order to understand how a specific organization uses information systems

Operational Excellence

- improved operational efficiency results in higher profitability - information systems and technologies help to improve higher levels of efficiency and productivity -Example: Wal-Marts RetailLink System provides digital links between its suppliers and stores

Solution Design

- try to consider as many different solutions as possible - some may emphasize technology while others may emphasize change in org and people - Most successful solutions usually involve an integrated approach

Four Elements of Critical Thinking:

1. Maintaining doubt and suspending judgment 2. Being aware of different perspectives 3. Testing alternatives and letting experience guide 4. Being aware of organizational and personal limitations

Information

Data shaped into a meaningful and useful form

New products, services, and business models

Information systems and technologies enable firms to create new products, services, and business models - A business model includes how a company produces, delivers, and sells its products and services to create wealth Example: - The music, travel, and newspaper industries have seen drastic changes in business models

Problem Identification

Must understand and agree: - that a problem exists - what the problem is - what its causes are - what can be done about it

Data

Streams fo raw facts representing events and occurrences

Critical Thinking

The sustained suspension of judgment with an awareness of multiple perspectives and alternatives

Computer literacy

focuses mostly on knowledge of technology

Technology

• IT Infrastructure: Foundation or platform that information systems built on • Computer hardware • Computer software • Data management technology • Networking and telecommunications technology • Internet and Web, extranets, intranets • Voice, video communications