Course Code: ITT05205

 Introduction to Information System

 Lecture: 2hours/wk
 Tutorial: 1hour/wk

1
 Course Assessment:

• Final Exam 60% end of Semester

• CA 40%
• 2 tests: 1 mid-semester
1 end of semester

2
 Principles and Learning Objectives

• The value of information is directly linked to how it

helps decision makers achieve the organization’s
goals
– Distinguish data from information and describe the
characteristics used to evaluate the quality of data

3
 Principles and Learning Objectives
(continued)
• Knowing the potential impact of information
systems and having the ability to put this
knowledge to work can result in a successful
personal career, organizations that reach their
goals, and a society with a higher quality of life
– Identify the basic types of business information
systems and discuss who uses them, how they are
used, and what kinds of benefits they deliver

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 Principles and Learning Objectives
(continued)
• System users, business managers, and information
systems professionals must work together to build
a successful information system
– Identify the major steps of the systems development
process and state the goal of each

5
 Principles and Learning Objectives
(continued)
• The use of information systems to add value to the
organization can also give an organization a
competitive advantage
– Identify the value-added processes in the supply
chain and describe the role of information systems
within them
– Identify some of the strategies employed to lower
costs or improve service
– Define the term competitive advantage and discuss
how organizations are using information systems to
gain such an advantage
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 Principles and Learning Objectives
(continued)
• IS personnel is a key to unlocking the potential of
any new or modified system
– Define the types of roles, functions, and careers
available in information systems

7
Why Learn About Information Systems
in Organizations?
• Information systems used by:
– Sales representatives
– Managers
– Financial advisors
• Information systems:
– Indispensable tools to help you achieve your career
goals

8
 Introduction
• Information system (IS):
– A set of interrelated components that collect,
manipulate, and disseminate data and information
and provide feedback to meet an objective
• Businesses:
– Can use information systems to increase revenues
and reduce costs

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 Information Concepts

• Information:
– One of an organization’s most valuable resources
– Often confused with the term data

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 Data, Information, and Knowledge
• Data:
– Raw facts
• Information:
– Collection of facts organized in such a way that they
have value beyond the facts themselves
• Process:
– Set of logically related tasks
• Knowledge:
– Awareness and understanding of a set of information

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Data, Information, and Knowledge
(continued)

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Data, Information, and Knowledge
(continued)

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Data, Information, and Knowledge
(continued)

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 The Characteristics of Valuable
Information
• If an organization’s information is not accurate or
complete:
– People can make poor decisions, costing thousands,
or even millions, of dollars
• Depending on the type of data you need:
– Some characteristics become more important than
others

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16
 The Value of Information

• Directly linked to how it helps decision makers

achieve their organization’s goals
• Valuable information:
– Can help people and their organizations perform
tasks more efficiently and effectively

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 What is an Information System?

• Information system (IS) is a set of interrelated

elements that:
– Collect (input)
– Manipulate (process)
– Store
– Disseminate (output) data and information
– Provide a corrective reaction (feedback mechanism)
to meet an objective

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What is an Information System?
(continued)

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 Input, Processing, Output, Feedback

• Input:
– Activity of gathering and capturing raw data
• Processing:
– Converting data into useful outputs
• Output:
– Production of useful information, usually in the form
of documents and reports
• Feedback:
– Information from the system that is used to make
changes to input or processing activities
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Manual and Computerized Information
Systems
• An information system can be:
– Manual or computerized
• Example:
– Investment analysts manually draw charts and trend
lines to assist them in making investment decisions
• Computerized information systems:
– Follow stock indexes and markets and suggest when
large blocks of stocks should be purchased or sold

21
Computer-Based Information Systems

• Single set of hardware, software, databases,

telecommunications, people, and procedures:
– That are configured to collect, manipulate, store, and
process data into information
• Technology infrastructure:
– Includes all hardware, software, databases,
telecommunications, people, and procedures
• Configured to collect, manipulate, store, and process
data into information

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Computer-Based Information Systems
(continued)

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Computer-Based Information Systems
(continued)
• Hardware:
– Consists of computer equipment used to perform
input, processing, and output activities
• Software:
– Consists of the computer programs that govern the
operation of the computer
• Database:
– Organized collection of facts and information,
typically consisting of two or more related data files

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Computer-Based Information Systems
(continued)
• Telecommunications, networks, and the Internet:
– The electronic transmission of signals for
communications
• Networks:
– Connect computers and equipment to enable
electronic communication
• Internet:
– World’s largest computer network, consisting of
thousands of interconnected networks, all freely
exchanging information

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Computer-Based Information Systems
(continued)
• Intranet:
– Internal network that allows people within an
organization to exchange information and work on
projects
• Extranet:
– Network that allows selected outsiders, such as
business partners and customers, to access
authorized resources of a company’s intranet

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Computer-Based Information Systems
(continued)
• People:
– The most important element in most computer-
based information systems
• Procedures:
– Include strategies, policies, methods, and rules for
using the CBIS

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 Business Information Systems

• Most common types of information systems:

– Those designed for electronic and mobile
commerce, transaction processing, management
information, and decision support
• Some organizations employ:
– Special-purpose systems, such as virtual reality, that
not every organization uses

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Business Information Systems
(continued)

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Business Information Systems
(continued)

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 Electronic and Mobile Commerce
• E-commerce:
– Any business transaction executed electronically
between:
• Companies (business-to-business, B2B)
• Companies and consumers (business-to-consumer,
B2C)
• Consumers and other consumers (consumer-to-
consumer, C2C)
• Business and the public sector
• Consumers and the public sector

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 Electronic and Mobile Commerce
(continued)
• Mobile commerce (m-commerce):
– The use of mobile, wireless devices to place orders
and conduct business
• E-commerce:
– Can enhance a company’s stock prices and market
value
• Electronic business (e-business):
– Uses information systems and the Internet to
perform all business-related tasks and functions

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Electronic and Mobile Commerce
(continued)

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 Enterprise Systems: Transaction
Processing Systems and Enterprise
Resource Planning
• Transaction:
– Any business-related exchange, such as payments
to employees and sales to customers
• Transaction processing system (TPS):
– Organized collection of people, procedures,
software, databases, and devices used to record
completed business transactions

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 Enterprise Systems: Transaction
Processing Systems and Enterprise
Resource Planning (continued)

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 Enterprise Systems: Transaction
Processing Systems and Enterprise
Resource Planning (continued)
• Enterprise resource planning:
– Set of integrated programs that manages the vital
business operations for an entire multisite, global
organization

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 Information and Decision Support
Systems
• Management information system (MIS):
– Organized collection of people, procedures,
software, databases, and devices that provides
routine information to managers and decision
makers

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Information and Decision Support
Systems (continued)

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 Information and Decision Support
Systems (continued)
• Decision support system (DSS):
– Organized collection of people, procedures,
software, databases, and devices that support
problem-specific decision making
– Can include:
• A collection of models used to support a decision
maker or user (model base)
• A collection of facts and information to assist in
decision making (database)
• Systems and procedures (user interface or dialogue
manager) that help decision makers and other users
interact with the DSS
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Information and Decision Support
Systems (continued)

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 Specialized Business Information
Systems: Knowledge Management,
Artificial Intelligence, Expert Systems,
and Virtual Reality
• Knowledge management systems (KMSs):
– Organized collection of people, procedures,
software, databases, and devices to:
• Create, store, share, and use the organization’s
knowledge and experience
• Artificial intelligence (AI):
– Computer system takes on characteristics of human
intelligence

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Specialized Business Information
Systems (continued)

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 Specialized Business Information
Systems (continued)
• Expert systems:
– Give computer ability to make suggestions and
function like an expert in a particular field
• Virtual reality and multimedia:
– Virtual reality:
• Simulation of a real or imagined environment that can
be experienced visually in three dimensions
– Multimedia:
• Can include photos and images, the manipulation of
sound, and special 3D effects

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 Systems Development

• Systems development:
– The activity of creating or modifying existing
business systems
• Outsourcing:
– Allows a company to focus on what it does best and
delegate other functions to companies with expertise
in systems development

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Systems Development (continued)

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 Systems Investigation and Analysis

• Goal of systems investigation:

– To gain clear understanding of the problem to be
solved or opportunity to be addressed
• Systems analysis:
– Defines the problems and opportunities of the
existing system

46
Systems Design, Implementation, and
Maintenance and Review
• Systems design:
– Determines how new system will work to meet
business needs defined during systems analysis
• Systems implementation:
– Acquiring various system components defined in
design step, assembling them, and putting the new
system into operation
• Systems maintenance and review:
– Checks and modifies the system so that it continues
to meet changing business needs

47
 Organizations and Information
Systems
• Organization:
– Formal collection of people and other resources
established to accomplish a set of goals
– A system
– Constantly uses money, people, materials, machines
and other equipment, data, information, and
decisions

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Organizations and Information
Systems (continued)

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 Organizations and Information
Systems (continued)
• Value chain:
– Series (chain) of activities that includes inbound
logistics and warehouse and storage
• Supply chain management (SCM):
– Determines:
• What supplies are required for value chain
• What quantities are needed to meet customer demand
• How supplies should be processed into finished goods
and services
• How shipment of supplies and products to customers
should be scheduled, monitored, and controlled

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Organizations and Information
Systems (continued)

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 Organizations and Information
Systems (continued)
• Customer relationship management (CRM)
programs:
– Help companies manage all aspects of customer
encounters
– Can get customer feedback to help design new
products and services

52
 Organizational Culture and Change

• Culture:
– Set of major understandings and assumptions
shared by a group
• Organizational culture:
– Major understandings and assumptions
– Influences information systems
• Organizational change:
– How organizations plan for, implement, and handle
change

53
 User Satisfaction and Technology
Acceptance
• Technology acceptance model (TAM):
– Specifies the factors that can lead to better attitudes
about the information system
• Technology diffusion:
– Measure of how widely technology is spread
throughout an organization
• Technology infusion:
– Extent to which technology permeates a department

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User Satisfaction and Technology
Acceptance (continued)

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 Competitive Advantage

• Significant and (ideally) long-term benefit to a

company over its competition
• Can result in higher-quality products, better
customer service, and lower costs

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 Factors That Lead Firms to Seek
Competitive Advantage
• The five-forces model:
– Rivalry among existing competitors
– Threat of new entrants
– Threat of substitute products and services
– Bargaining power of buyers
– Bargaining power of suppliers

57
 Strategic Planning for Competitive
Advantage
• Strategies:
– Cost leadership
– Differentiation
– Niche strategy
– Altering the industry structure
– Creating new products and services
– Improving existing product lines and service

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 Strategic Planning for Competitive
Advantage (continued)
• Other strategies:
– Growth in sales
– First to market
– Customizing products and services
– Hiring the best people
– Innovation

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 Performance-Based Information
Systems
• Major stages in the use of information systems:
– Cost reduction and productivity
– Competitive advantage
– Performance-based management

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 Productivity

• A measure of output achieved divided by input

required
• Higher level of output for a given level of input
means greater productivity
• Lower level of output for a given level of input
means lower productivity
• Productivity = (Output / Input) × 100%

62
Return on Investment and the Value of
Information Systems
• Return on investment (ROI):
– One measure of IS value
– Investigates the additional profits or benefits that are
generated as a percentage of the investment in IS
technology
• Earnings growth:
– The increase in profit that the system brings

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Return on Investment and the Value of
Information Systems (continued)
• Market share and speed to market:
– The percentage of sales that a product or service
has in relation to the total market
• Customer awareness and satisfaction:
– Performance measurement is based on feedback
from internal and external users
• Total cost of ownership:
– The sum of all costs over the life of the information
system

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 Risk

• Managers must consider the risks of designing,

developing, and implementing systems
• Information systems can sometimes be costly
failures

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 Careers in Information Systems

• Degree programs:
– Information systems
– Computer information systems
– Management information systems
• U.S. Department of Labor’s Bureau of Labor
Statistics (www.bls.gov):
– Predicts that many technology jobs will increase
through 2012 or beyond

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 Roles, Functions, and Careers in IS

• Primary responsibilities in information systems:

– Operations:
• System operators primarily run and maintain IS
equipment
– Systems development:
• Focuses on specific development projects and
ongoing maintenance and review

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 Roles, Functions, and Careers in IS

• Primary responsibilities in information systems

(continued):
– Support:
• Provides user assistance in hardware and software
acquisition and use, data administration, user training
and assistance, and Web administration
– Information service units:
• A miniature IS department attached and directly
reporting to a functional area in a large organization

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