GB 310 Final Exam

Market Share

Calculated by dividing the firm's sales by the total market sales for the entire industry Common external KPI

Attributes

Characteristics or properties of an entity class

Data Mart

Contains a subset of data warehouse information

Managerial Level

Employees are continuously evaluating company operations to hone the firm's abilities to identify, adapt to, and leverage change Managerial decisions cover short- and medium-range plans, schedules, and budgets along with policies, procedures, and business objectives for the firm

E-Business

The conducting of business on the Internet, not only buying and selling, but also serving customers and collaborating with business partners

Data Models

A formal way to express data relationships to a database management system (DBMS)

Data Warehousing

A key idea within data warehousing is to take data from multiple platforms/ technologies (as varied as spreadsheets, databases, and word files) and place them in a common location that uses a common querying tool Data warehouse give the information itself commonality by defining what each term means and keeping it standard A data warehouse is not a location for all of a business's information, but rather a location for information that is interesting, or information that will assist decision makers in making strategic decisions relative to the organization's overall mission Data warehousing is about extending the transformation of data into information Data warehouses offer strategic level, external, integrated, and historical information so businesses can make projections, identify trends, and decide key business issues Data warehouse collects and stores integrated sets of historical information from multiple operational systems and feeds them to one or more data marts Data warehouses may provide end-user access to support enterprisewide views of information

Backward Integration

takes information entered into a given system and sends it automatically to all upstream systems and processes

Critical Success Factors

A factor that is critical to an organization's success Crucial for a business strategy's success

Characteristics of High-Quality Information

1. Accuracy 2. Completeness 3. Consistency 4. Timeliness 5. Uniqueness

Benefits of Using High-Quality Information

1. Can significantly improve the chances of making a good decision 2. Can directly increase an organization's bottom line

Costs of Using Low-Quality Information

1. Inability to accurately track customers 2. Difficulty identifying the organization's most valuable customers 3. Inability to identify selling opportunities 4. Lost revenue opportunities from marketing to nonexistent customers 5. The cost of sending nondeliverable mail 6. Difficulty tracking revenue because of inaccurate invoices 7. Inability to build strong relationships with customers

Primary Key

A field (or group of fields) that uniquely identifies a given entity in a table Provide a way of distinguishing each record in a table

Advantages of a Relational Database

1. Increased flexibility Databases need to handle changes quickly and easily Databases need to provide flexibility in allowing each user to access the information in whatever way best suits his or her needs 2. Increased scalability and performance Databases need to be scalable to handle large volumes of information and large numbers of users 3. Reduced information redundancy Redundant data can cause storage issues along with data integrity issues, making it difficult to determine which values are the most current or most accurate One primary goal of a database is to eliminate information redundancy by recording each piece of information in only one place in the database → saves disk space, makes performing updates easier, improves information quality 4. Increased information integrity 5. Increased information security Managers must protect information, like any asset, from unauthorized users or misuse Databases offer many security features including passwords to provide authentication, access levels to determine who can access the data, and access controls to determine what type of access they have to the information Security risks are increasing as more and more databases and DBMS systems are moving to data centers run in the cloud

Four Primary Traits of the Value of Informaion

1. Information Type 2. Information Timeliness 3. Information Quality 4. Information Governance

Common Financial Rations

1. Internal Rate of Return (IRR) 2. Return on Investment (ROI) 3. Payback Method 4. Break-Even Analysis

Customer Relationship Management (CRM) Metrics

1. Sales Metrics 2. Service Metrics 3. Marketing Metrics

Interrelationship Between Efficiency and Effectivness MIS Metrics

1. Success in one area does not necessarily imply success in the other → efficiency doesn't guarantee effectiveness 2. Efficiency MIS metrics focus on the technology itself 3. Effectiveness MIS metrics are determined according to an organization's goals, strategies, and objectives 4. Ideally, a firm wants to operate in the upper right-hand corner of the graph, realizing both significant increases in efficiency and effectiveness 5. Operating in the upper left-hand corner (minimal effectiveness with increased efficiency) or the lower right-hand corner (significant effectiveness with minimal efficiency) may be in line with an organization's particular strategies 6. Operating in the lower left-hand corner (minimal efficiency and minimal effectiveness) is not ideal for the operation of any organization

Information Type

1. Transactional Information 2. Analytical Information

Advantages of Using the Web to Access Company Databases

1. Web browsers are easier to use than directly accessing the database using a custom-query tool 2. Web interface requires few or no changes to the database model 3. Costs less to add a web interface in front a DBMS than to redesign and rebuild the system to support changes 4. Easy to manage content 5. Easy to store large amounts of data 6. Easy to eliminate human errors

Metrics for Assessing Strategic Initiatives

1. Website Metrics 2. Supply Chain Management (SCM) Metrics 3. Customer Relationship Management (CRM) Metrics 4. Business Process Reengineering (BPR) Metrics 5. Enterprise Resource Planning (ERP) Metrics

Record

A collection of related data elements Each record in an entity occupies one row in its respective table

Data Warehouse

A logical collection of information - gathered from many different operational databases - that supports business analysis activities and decision-making tasks The primary purpose of a data warehouse is to aggregate information throughout an organization into a single repository in such a way that employees can make decisions and undertake business analysis activities

Balanced Scorecard

A management system that enables organizations to clarify their vision and strategy and translate them into action Provides feedback around both internal business processes can external outcomes in order to continuously improve strategic performance and results Retains traditional financial measures and also develops metrics, collects data Views the organization from four perspectives: 1. The learning and growth perspective 2. The internal business process perspective 3. The customer perspective 4. The financial perspective

Information Integrity

A measure of the quality of information Information integrity occur when a system produces incorrect, inconsistent, or duplicate data Data integrity issues can cause managers to consider the system reports invalid and will make decisions based on other sources

Foreign Key

A primary key of one table that appears as an attribute in another table and acts to provide a logical relationship between the two tables Creating the logical relationship between the tables allows managers to search the data and turn it into useful information

Extraction, Transformation, Loading (ETL)

A process that extracts information from internal and external databases, transforms the information using a common set of enterprise definitions, and loads the information into the data warehouse

Information Cleansing or Scrubbing

A process that weeds out and fixes or discards inconsistent, incorrect, or incomplete information Specialized software tools use sophisticated algorithms to parse, standardize, correct, match, and consolidate data warehouse information In a data warehouse, information cleansing occurs first during the ETL process and second on the information once it is in the data warehouse Looking at customer information highlights why information cleansing is necessary

Model

A simplified representation or abstraction of reality Help managers calculate risks, understand uncertainty, change variables, and manipulate time to make decisions MIS support systems rely on models for computational and analytical routines that mathematically express relationships among variables

Project

A temporary endeavor undertaken to create a unique product or service

Relational Database Model

A type of database that stores information in the form of logically related two-dimensional tables

Integration

Allows separate systems to communicate directly with each other Without integrations, an organization will spend considerable time entering the same information in multiple systems and suffers from the low quality and inconsistency typically embedded in redundant information 1. Forward Integration 2. Backward Integration Ideally, an organization wants to build both forward and backward integrations, which provide the flexibility to create, update, and delete information in any of the systems Integrations are expensive and difficult to build and maintain and most organizations build only forward integrations → integration of information is not possible for any changes occurring outside the initial system, which again can result in inconsistent organizational information Can integrate customer information among databases → updated information from central database is sent to other systems

Relational Database Management System

Allows users to create, read, update, and delete data in a relational database

Dynamic Catalog

An area of a website that stores information about products in a database

Data-Driven Website

An interactive website kept constantly updates and relevant to the needs of its customers through the use of a database Can help limit the amount of information displayed to customers based on unique search requirements Used by companies to make information in their internal databases available to customers and business partners

Benchmarks

Baseline values the system seeks to attain Help assess how an MIS project performs over time

Information Quality

Business decisions are only as good as the quality of the information used to make them 1. Information Integrity 2. Information Consistency

Forward Intergration

Takes information entered into a given system and sends it automatically to all downstream systems and processes

What-If Analysis

Checks the impact of a change in an assumption on the proposed solution A user would be able to observe and evaluate any changes that occurred to the values in the model, especially to a variable such as profits Users repeat this analysis with different variables until they understand all the effects of various situations

Data Dictionary

Compiles all of the metadata about the data elements in the data model Looking at a data model along with reviewing the data dictionary provides tremendous insight into the database's functions, purpose, and business rules

Business Rule

Defines how a company performs a certain aspect of its business and typically results in either a yes/no or true/false answer

Source Documents

Describes the basic transaction data such as its date, purpose, and amount and includes cash receipts, canceled checks, invoices, customer refunds, employee time sheet, etc

Metadata

Details about data

Break-Even Analysis

Determine the volume of business required to make a profit at the current prices charged for the products or services

Operational Level

Employees develop, control, and maintain core business activities required to run the day-to-day operations

Transactional Information

Encompasses all of the information contained within a single business process or unit of work, and its primary purpose is to support the performing of daily operational tasks Stored to perform operational tasks and repetitive decisions Managers use transactional information when making structured decisions at the operational level

Analytical Information

Encompasses all organizational information, and its primary purpose is to support the performing of managerial analysis tasks Makes it possible to do many things that previously were difficult to accomplish, such as spot business trends, prevent diseases, and fight crime

Business-Critical Integrity Constraints

Enforces business rules vital to an organization's success and often requires more insights and knowledge than relational integrity constraints

Business Process Reengineering (BPR) Metrics and Enterprise Resource Planning (ERP) Metrics

Extremely difficult to measure Use balanced scorecard to measure

Goal Seeking Analysis

Finds the inputs necessary to achieve a goal such as a desired level of output Sets a target value (a goal) for a variable and then repeatedly changes other variables until the target value is achieved

Logical View of Information

Focuses on how users logically access information to meet their particular business needs

Supply Chain Management (SCM) Metrics

Help an organization understand how it's operating over a given time period Can cover areas such as procurement, production, distribution, warehousing, inventory, transportation, and customer service A supply chain is only as strong as it's weakest link → good performance is one part is not sufficient

Query-By-Example (QBE) Tool

Helps users graphically design the answer to a question against a database

Real-Time Information

Immediate, up-to-date information The growing demand for real-time information stems from organizations' need to make faster and more effective decisions, keep smaller inventories, operate more efficiently, and track performance more carefully One of the biggest pitfalls of real-time information is continual change Business decision makers must evaluate the timeliness for the information for every decision

Entity

In the relational database model, a person, place, thing, transaction, or event about which information is stored

Dynamic Information

Includes data that change based on user actions Changes when a user requests information

Static Information

Includes fixed data that are not capable of change in the event of a user action

Return on Investment (ROI)

Indicates the earning power of a project Common internal KPI Measured by dividing the profitability of a project by the project costs Challenging to measure

Information

Information can tell an organization how its current operations are performing and help it estimate and strategize about how future operations might perform When addressing a significant business issue, employees must be able to obtain and analyze all the relevant information so they can make the best decision possible. Information comes at different levels, formats, and granularities

Structured Decisions

Involves situations where established processes offer portential solutions Operational decisions are considered structured decisions Made frequently Repetitive in nature

Database

Maintains information about various types of objects (inventory), events (transactions), people (employees), and places (warehouses)

Strategic Level

Managers develop overall business strategies, goals, and objectives as part of the company's strategic plan Managers monitor the strategic performance of the organization and its overall direction in the political, economic, and competitive business environment

Metrics

Measurements that evaluate results to determine whether a project is meeting its goals 1. Critical Success Factors 2. Key Performance Indicators

Key Performance Indicators

Measures that are ties to business drivers Measure the progress of CSFs with quantifiable measurements, and one CSF can have several KPIs Can focus on external and internal measurements Creating KPIs to measure the success of an MIS project is difficult → need higher level metrics to (i.e. efficiency and effectiveness) to measure MIS projects

Effectiveness MIS Metrics

Measures the impact IT has on business processes and activities including customer satisfaction, conversion rates, and sell-through increases Focuses on how well a firm is achieving its goals and objectives "Doing the right thing" Large increases in productivity typically result from increases in effectiveness, which focus on CSFs

Efficiency MIS Metrics

Measures the performance of the IT system itself through throughput, speed, and availability Focuses on the extent to which a firm is using its resources in an optimal way "Doing things right" Easier to measure → managers tend to focus on them (not always correct way to measure MIS projects)

Decision Support Systems (DSS)

Models information to support managers and business professionals during the decision-making process Enable high-level managers to examine and manipulate large amounts of detailed data from different internal and external sources Key use: analyzing complex relationships among thousands or even millions of data items to discover patterns, trends, and exception conditions

Website Metrics

Most companies measure the traffic on a website as the primary determinant of the website's success Company can use web traffic analysis or web analytics to determine the revenue generated, the number of new customers acquired, any reductions in customer service calls, etc. A web-centric metric is a measure of the success of web and e-business initiatives

Semistructured Decisions

Occurs in situations in which a few established processes help to evaluate potential solutions, but not enough to lead to a definite recommended decision

Unstructured Decisions

Occurs in situations in which no procedures or rules exist to guide decision makers toward the correct choice Infrequent decisions Typically related to long-term business strategy

Information Inconsistency

Occurs when the same data element has different values

Reasons for Low-Quality Information

Online customers intentionally enter inaccurate information to protect their privacy. Different systems have different information entry standards and formats. Data-entry personnel enter abbreviated information to save time or erroneous information by accident. Third-party and external information contains inconsistencies, inaccuracies, and errors

Real-Time Systems

Provides real-time information in response to query requests Used to uncover key corporate transactional information

Information Granularity

Refers to the extent of detail within the information (fine and detailed or "coarse" and abstract information)

Data Governance

Refers to the overall management of the availability, usability, integrity, and security of company data A company that supports a data governance program has a defined a policy that specifies who is accountable for various portions or aspects of the data, including its accuracy, accessibility, consistency, timeliness, and completeness The policy should clearly define the processes concerning how to store, archive, back up, and secure the data and the company should create a set of procedures identifying accessibility levels for employees The firm should deploy controls and procedures that enforce government regulations and compliance with mandates such as Sarbanes-Oxley

Database Management Systems (DBMS)

Software through which users and application programs interact with a database Managers send requests to the DBMS, and the DBMS performs the actual manipulation of the data in the database. Companies store their information in databases, and managers access these systems to answer operational questions Tools for retrieving information from DBMS - query-by-example and structured query language

Decision Making Process

Step 1: Problem identification Step 2: Data collection Step 3: Solution generation Step 4: Solution test Step 5: Solution selection Step 6: Solution implementation

Transaction Processing System (TPS)

The basic business system that serves the operational level (analysts) in an organization Example: payroll system or order-entry system

Online Transaction Processing (OLTP)

The capturing of transaction and event information using technology to (1) process the information according to defined business rules, (2) store the information, and (3) update existing information to reflect the new information During OLTP, the organization must capture every detail of transactions and events

Cube

The common term for the representation of multidimensional information Once a cube of information is created, users can begin to slice and dice the cube to drill down into the information

Information Redundancy

The duplication of data, or the storage of the same data in multiple places

Online Analytical Processing (OLAP)

The manipulation of information to create business intelligence in support of strategic decision making

Best Practices

The most successful solutions or problem-solving methods that have been developed by a specific organization or industry Measuring MIS projects helps determine the best practices for an industry

Payback Method

The number of years to recoup the cost of an initiative based on projected annual net cash flow

Content Creator

The person responsible for creating the original website content

Content Editor

The person responsible for updating and maintaining website content

Physical View of Information

The physical storage of information on a storage device such as a hard disk

Data Mining

The process of analyzing data to extract information not offered by the raw data alone

Benchmarking

The process of continuously measuring system results, comparing those results to optimal system performance (benchmark values), and to identify steps and procedures to improve system performance

Internal Rate of Return (IRR)

The rate at which the net present value of an investment equals zero

Relational Integrity Constraints

The rules that enforce basic and fundamental information-based constraints

Information Constraints

The rules that help ensure the quality of information 1. Relational Integrity Constraints 2. Business Rule 3. Business-Critical Integrity Constraints

Analytics

The science of fact-based decision making

Data Element (Data Field)

The smallest or basic unit of information

Sensitivity Analysis

The study of the impact that changes in one (or more) parts of the model have on other parts of the model Useful when users are uncertain about the assumptions made in estimating the value of certain key variables

Information Timeliness

Timeliness of information depends on the situation 1. Real-Time Information

Information Governance

To ensure a firm manages its information correctly, it will need special policies and procedures establishing rules on how the information is organized, updated, maintained, and accessed 1. Data Governance

Operational Systems

Typically include accounting, order entry, customer service, and sales and are not appropriate for business analysis for the following reasons: Information from other operational applications is not included. Operational systems are not integrated, or not available in one place. Operational information is mainly current—does not include the history that is required to make good decisions. Operational information frequently has quality issues (errors)—the information needs to be cleansed. Without information history, it is difficult to tell how and why things change over time. Operational systems are not designed for analysis and decision support

Structured Query Language (SQL)

Users write lines of code to answer questions against a database

Data Mining Tools

Uses a variety of techniques to find patterns and relationships in large volumes of information and infer rules from them that predict future behavior and guide decision making Data-mining tools for data warehouses and data marts include query tools, reporting tools, multidimensional analysis tools, statistical tools, and intelligent agents