Chapter 1: What is Information System?

People

- A focus on the people involved in information systems is the next step. From the front-line help-desk workers, to systems analysts, to programmers, all the way up to the chief information officer (CIO), the people involved with information systems are an essential element that must not be overlooked.

Networking Communication: A Fourth Technology Piece?

- An information system can exist without the ability to *communicate* - the first personal computers were stand-alone machines that did not access the Internet. - - In today's hyper-connected world, it is an extremely rare computer that does not connect to another device or to a network. - Technically, the networking communication component is made up of hardware and software, but it is such a core feature of today's information systems that it has become its own category.

The Role of Information Systems: The PC Revolution

- Apple's Mac and Microsoft Windows - These early PCs were not connected to any sort of network; for the most part they stood alone as islands of innovation within the larger organization.

Technology: Hardware, Software, and Data

- As discussed before, the first three components of information systems - hardware, software, and data - all fall under the category of technology.

SQ 2: What are three examples of information system hardware?

Computers, keyboards, disk drives, iPads, flash drives etc.

SQ 5: What roles do people play in information systems?

EX: Front-line help-desk employees, system analysts, programs, to Chief Information Officer (CIO).

SQ 9: What does it mean to say we are in a "post-PC world"?

After about 30 years as the primary computing device used in most businesses, the sales of PC finally began to decline. Tablets and Smartphones started to take off. These limited devices on storage, processing power, and functionality led to "cloud" computing that allowed for storage, sharing and backing up information on a massive scale.

The Post-PC World

After thirty years as the primary computing device used in most businesses, sales of the PC are now beginning to decline as sales of tablets and smartphones are taking off. Just as the mainframe before it, the PC will continue to play a key role in business, but will no longer be the primary way that people interact and do business. The limited storage and processing power of these devices is being offset by a move to "cloud" computing, which allows for storage, sharing, and backup of information on a massive scale. This will require new rounds of thinking and innovation on the part of businesses as technology continues to advance.

SQ 1: What are the five components that make up an information systems?

Hardware, Software, Data, People, and Process

SQ 8: In what year were restrictions on commercial use of the Internet first lifted? When were eBay and Amazon founded?

In 1991, The National Science Foundation, which governed how the Internet was used, lifted restrictions on its commercial use. The year 1994 saw the establishment of both eBay and Amazon.com. Internet-based business led to the dot-com boom through the 1990s and the dot-con bust in the 2000s.

SQ 10: What is Carr's main argument about information technology?

In 2003, Nicholas Carr wrote and article that questioned the assumption if IS bring competitive advantage. He raised the idea that it is just a commodity. Instead of viewing IT as an investment that will make a company standout, it should be seen as something like electricity. It should be manage to reduce costs, and ensure it is always running and risk-free as possible. BUT, Walmart became a competitive advantage because of this.

Summary:

In this chapter, you have been introduced to the concept of information systems. We have reviewed several definitions, with a focus on the components of information systems: technology, people, and process. We have reviewed how the business use of information systems has evolved over the years, from the use of large mainframe computers for number crunching, through the introduction of the PC and networks, all the way to the era of mobile computing. During each of these phases, new innovations in software and technology allowed businesses to integrate technology more deeply. We are now to a point where every company is using information systems and asking the question: Does it bring a competitive advantage? In the end, that is really what this book is about. Every businessperson should understand what an information system is and how it can be used to bring a competitive advantage. And that is the task we have before us.

SQ 7: What was invented first, the personal computer or the Internet (ARPANET)?

The Internet was activated first and then the personal computer was invented.

SQ 6: What is the definition of a process?

The last component to IS is process. It is the series of steps undertaken to achieve a desired outcome or goal. The ultimate goal is to use technology to manage and improve processes.

Web 2.0

- As the world recovered from the dot-com bust, the use of technology in business continued to evolve at a frantic pace. Websites became interactive; instead of just visiting a site to find out about a business and purchase its products, customers wanted to be able to customize their experience and interact with the business. - This new type of interactive website, where you did not have to know how to create a web page or do any programming in order to put information online, became known as web 2.0. Web 2.0 is exemplified by blogging, social networking, and interactive comments being available on many websites. This new web-2.0 world, in which online interaction became expected, had a big impact on many businesses and even whole industries. - Some industries, such as bookstores, found themselves relegated to a niche status. Others, such as video rental chains and travel agencies, simply began going out of business as they were replaced by online technologies. This process of technology replacing a middleman in a transaction is called disintermediation. - As the world became more connected, new questions arose. Should access to the Internet be considered a right? Can I copy a song that I downloaded from the Internet? How can I keep information that I have put on a website private? What information is acceptable to collect from children? Technology moved so fast that policymakers did not have enough time to enact appropriate laws, making for a Wild West-type atmosphere

The Role of Information Systems: Mainframe Era (1950s - 60s)

- Computers were seen as a way to more efficiently do calculations. - Only large businesses, universities, and government agencies could afford them, and they took a crew of specialized personnel and specialized facilities to maintain - These devices served dozens to hundreds of users at a time through a process called time-sharing. - Typical functions included scientific calculations and accounting, under the broader umbrella of "data processing."

Defining Information Systems

- Definitions focus on two different ways of describing information systems: 1) the components that make up an information system a 2) the role that those components play in an organization EX: Information systems are combinations of hardware, software, and telecommunications networks that people build and use to collect, create, and distribute useful data, typically in organizational settings.

The World Wide Web and E-Commerce

- In 1969, the Internet was confined to use by universities, government agencies, and researchers for many years. - While the first e-mail messages on the Internet were sent in the early 1970s, companies who wanted to expand their LAN-based e-mail started hooking up to the Internet in the 1980s. - Companies began connecting their internal networks to the Internet in order to allow communication between their employees and employees at other companies. - It was with these early Internet connections that the computer truly began to evolve from a computational device to a communications device. - As web browsers and Internet connections became the norm, companies rushed to grab domain names and create websites.

Technology: Hardware

- Information systems hardware is the part of an information system you can touch - the physical components of the technology. Computers, keyboards, disk drives, iPads, and flash drives are all examples of information systems hardware.

Client Server

- Mid 19080s, business began to see the need to connect together as a way to collaborate and share resources - This networking architecture was referred to as " client-server" because users would log into the local area network (LAN) and connecting it to a powerful computer called a "server" - Computers were now seen as tools to collaborate internally, within an organization. These networks of computers were becoming so powerful that they were replacing many of the functions previously performed by the larger mainframe computers at a fraction of the cost. - An *ERP system* is a software application with a centralized database that can be used to run a company's entire business. With separate modules for accounting, finance, inventory, human resources, and many, many more, ERP systems, with Germany's SAP leading the way, represented the state of the art in information systems integration.

The Role of Information Systems

- One of the roles of information systems is to take data and turn it into information, and then transform that into organizational knowledge. - As technology has developed, this role has evolved into the backbone of the organization.

Technology: Software

- Software is a set of instructions that tells the hardware what to do. When programmers create software programs, what they are really doing is simply typing out lists of instructions that tell the hardware what to do. There are several categories of software, with the two main categories being *operating-system software*, which makes the hardware usable, and *application software*. Ex: 1) Operating Systems - Microsoft Windows and MAC 2) Application Software - Microsoft Excel and Angry Birds

Process

- The last component of information systems is process. - A process is a series of steps undertaken to achieve a desired outcome or goal. Information systems are becoming more and more integrated with organizational processes, bringing more productivity and better control to those processes. But simply automating activities using technology is not enough - business looking to effectively utilize information systems to do more.

Technology: Data

- Think data as a collection of facts. By themselves, pieces of data are not really very useful. - But aggregated, indexed, and organized together into a database, data can become a powerful tool for businesses. In fact, all of the definitions presented at the beginning of this chapter focused on how information systems manage data. Organizations collect all kinds of data and use it to make decisions.

Sidebar: Walmart Uses Information Systems to Become the World's Leading Retailer

One of the keys to this success was the implementation of Retail Link, a supply-chain management system. This system, unique when initially implemented in the mid-1980s, allowed Walmart's suppliers to directly access the inventory levels and sales information of their products at any of Walmart's more than ten thousand stores. Using Retail Link, suppliers can analyze how well their products are selling at one or more Walmart stores, with a range of reporting options. Further, Walmart requires the suppliers to use Retail Link to manage their own inventory levels. If a supplier feels that their products are selling out too quickly, they can use Retail Link to petition Walmart to raise the levels of inventory for their products. This has essentially allowed Walmart to "hire" thousands of product managers, all of whom have a vested interest in the products they are managing. This revolutionary approach to managing inventory has allowed Walmart to continue to drive prices down and respond to market forces quickly

SQ 3: Microsoft Windows is an example of which component of information systems?

Operating System Software

SQ 4:What is an "application software:?

Operating System software makes the hardware usable (EX. Windows/Mac). Application software is a software that does something useful (EX. Microsoft Excel)