ITM 102: Information Systems, Chapter 1

• ITM 102 is Business Information Systems for the Winter 2025 semester, taught by Mahdi Abouei.

Agenda

• The course will cover the learning objectives, the course book, an introduction to the subject, and the course outline
• Chapter 1, discussing information systems in global business today, will be covered

Learning Outcomes

• Familiarization with the applications of Information Systems in modern business is expected
• The students will be able to compare and contrast how businesses employ information systems to obtain and sustain competitive advantage
• There will be an understanding of key components of information systems management, including technology, people, organization, and their interactions
• The course will discuss the value of information systems investments.
• Organizational strategies for adopting information systems will be learned
• The role of enterprise systems in enforcing organizational structure and processes will be described
• Potential threats to information systems, and strategies to reduce and recover from imposed risks will be identified.
• There will be an explanation of the information systems' role in supporting organizational decision-making.
• The course will discuss the ethical issues around the use of information systems
• Common management issues in using information Systems will be recognized

Course Textbook

• Management Information Systems: Managing the Digital Firm, (17th Edition), 2022
• The authors are Kenneth C. Laudon and Jane P. Laudon
• The publisher is Pearson

About the Instructor

• The instructor is Mahdi Abouei
• He is a Postdoctoral Fellow at McMaster University
• Obtained a Ph.D. in Information Systems from McMaster University
• His research area is Big Data Analytics and AI Implementation
• Abouei also has a Master of Business Administration degree
• Also has a BSc in Mechanical Engineering
• Email: [email protected]
• Office hours are on Monday (5:30 pm – 6:30 pm), Tuesday (6:00 pm – 7:00 pm), and Wednesday (12:00 pm - 1:00 pm)

Student Info

• The instructors asks the students what do they hope to get from this course

Course Evaluation

• Synchronous participation is worth 10%
• In-class quizzes are weekly and count for 5%; two quizzes with the lowest score will be dropped
• A participation score will be assigned for engagement and counts for 5%; Kahoot! will be used to evaluate it and two participation scores will be dropped
• Evaluation criteria include attendance, question answering, and the quality of comments made
• When using Kahoot! use your STUDENT NUMBER and Do not close Kahoot during the lecture!
• Case assignments will be assigned during the term and will count for 20%
• Case studies will be assigned during the term and discussed in detail in the scheduled tutorial (lab) session Two case studies will be marked (Weeks 4 and 9), each worth 10%
• Exams count for 70%
• There will be a midterm worth 30% and a final exam worth 40%,
• Exams cover concepts from lectures and the book chapters
• The exams are in-person and closed-book and will be held at the TMU campus
• The midterm covers materials from the first half of the course
• The final exam covers all the materials in the course

Chapter 1: Information Systems in Global Business Today

• Chapter 1 will cover how information systems are transforming business
• Key topics include why they are essential for managing a business, what an information system is and how it works, including its components, and what academic disciplines study information systems

Information Technology Capital Investment

• Global spending on IT and IT services was nearly $3.8 trillion in 2019
• $160 billion was spent on management consulting and services in 2019

New Development in Management Information Systems

• Continuous changes in technology, management, and business processes
• IT Innovations are happening in Cloud computing, mobile digital platforms, big data, AI, and the Internet of Things (IoT)
• New Business Models are being developed; Viewers are unplugging from cable and using only the Internet for entertainment (Netflix)
• E-Commerce is Expanding in selling services, not only goods
• Management Changes are in Online collaboration, Business Intelligence, and Virtual meetings
• Changes in Firms and Organizations are that they are More collaborative, using social media to listen to consumers and being more aware of technologies

Globalization Challenges and Opportunities

• Internet, and global communications have greatly changed how and where business is done
• The Internet has drastically reduced the costs of operating on a global scale
• Globalization has Increases in foreign trade and outsourcing
• Competition for jobs, markets, resources, and ideas
• Growing interdependence of global economies
• Requires a new understanding of markets and opportunities

Key Aspects of the Emerging Digital Firm

• Significant business relationships are digitally enabled and mediated
• Core business processes are accomplished through digital networks
• Key corporate assets are managed digitally Digital firms offer greater flexibility in organization and management Time shifting, and space shifting Many firms are close to becoming digital firms.

Strategic Business Objectives in Relation to Information System

• Growing interdependence between the ability to use information technology and implementing corporate strategies in order to achieve corporate goals.

The Interdependence Between Organizations and Information Systems

• The Business Firm is dependant on the the Business Strategic Objectives and Business Processes
• Business Processes are reliant on Software, Hardware, Data Management, and Telecommunications

Strategic Business Objectives of Information System

• Firms invest heavily in information systems to achieve six strategic business objectives
• Strategic business objectives incude Operational excellence
• Creating new products, services, and business models is also an objective
• To improve Customer and supplier intimacy
• Improved decision making
• Competitive advantage
• Survival

The Role of Information Systems in Business Today

• Operational excellence involves improvement in efficiency for higher profitability
• Information systems and technologies are an important tools in achieving greater productivity Walmart reports over $524 billion in sales in 2019; Retail Link System Links suppliers to stores for a superior replenishment system
• Firms need new products, New services and new business models
• How a company produces, delivers, and sells products or services to create wealth
• Information systems are major tool to create
• Apple has an old business model based on records, tapes, CDs, and a new business model based on the Internet, iPad, and iTunes.
• Serving customers well leads to a customer returning, raising revenue and profits, thus promoting customer and Supplier Intimacy
• The Mandarin Oriental hotel is a great Example of Personalized services in hotels utilizing Room temperature, lights, and music to give vital inputs
• Intimacy with suppliers results in lower costs JCPenney enhances relationships with suppliers in Hong Kong using the JCPenney's Information System

Improving Descision Making

• Without accurate information, managers do not have the right information at the right time Without accurate information, there is possible misallocation of resources
• Poor outcomes raise costs, and lose customers
• Real-time data improves the ability to make decisions

Cont..

• The goal of a business should be to find a Competitve Advantage
• Business should focus on Delivering better products, and charging less for superior products
• Responding to customers and suppliers in real-time will also create a Competitve Advantage

The Role of Survival in Information Systems

• Competing with competitors can create industry-level changes
• The introduction of Citibank's ATMs is an example of an industry level change
• Governmental regulations require record-keeping
• Toxic Substances Control Act
• Sarbanes-Oxley Act
• Dodd-Frank Act

Core concepts of an Information System

• An Information System is a set of interrelated components: Collect, process, store, and distribute information Support decision-making, coordination, and control
• Information technology
• The hardware and software a firm needs to achieve business objectives
• Data are raw facts
• Information is data shaped into a meaningful form

Functions of an Information System

• Input - Raw data or information from an organization, external environment, or other IS
• Processing - converts raw data (or one form of information) into more meaningful information
• Output - Info supplied to people (or other I.S.) that are active in the Organization
• Feedback - Output is returned to members of the organization to help them evaluate or correct the Input and/or Processing
• It is important to make the distinction between computer and Computer Prgram vs. Information System

3 Key Dimensions of Information Systems

• Organization
• Hierarchy of authority, responsibility, and the separation of business functions
• Unique business processes, culture and Organizational politics
• Management
• Managers set organizational strategy, and must act creatively
• Occasionally re-creating the Organization
• Technology
• Hardware/Software, infrastructure and Data Management

Core tenents of a Business Perspective

• An information system is an instrument for creating value
• Business information value chain
• Raw data is acquired and transformed through stages that add value to information
• The value of information systems is primarily determined by the extent to which they lead to better decisions, greater efficiency, and higher profits

Factors for the Business

• Investing in IT does not guarantee good returns
• There is considerable variance in the returns investment firms receive from systems investment
• Adopting the right business model an -dinvesting in complementary assets will increase your chanchesof a good return

Contemporary Approaches

• Technical Approach involves mathematically based models
• Utilizes Computer science, management science, operations research
• Behavioral approach
• Behavioral issues (strategic business integration, implementation, etc.)
• Utilizes Physcology, economics, sociology
• Sociotechnical Approach
• Optimal organizational performance is achieved by jointly optimizing both social and technical systems used in production