Ch1(1) (1).pptx

Essentials of Management Information Systems Thirteenth Edition Chapter 1 Business Information Systems in Your Career Copyright © 2019 Pearson Education Ltd. Learning Objectives 1.1 Why are informat...

Essentials of Management Information Systems Thirteenth Edition Chapter 1 Business Information Systems in Your Career Copyright © 2019 Pearson Education Ltd. Learning Objectives 1.1 Why are information systems so essential for running and managing a business today? 1.2 What exactly is an information system? How does it work? What are its people, organizational, and technology components? 1.3 How will a four-step method for business problem solving help you solve information system-related problems? Copyright © 2019 Pearson Education Ltd. Premier League: The Power of IT Analytics (1 of 2) Problem – Improving revenue and player training through Big Data. Solutions – The Football Manager game simulation as a database – A system of player-performance-enhancing IT analytics apps Copyright © 2019 Pearson Education Ltd. Premier League: The Power of IT Analytics (2 of 2) Use of networked sensors and powerful analytics to drive business operations and management decisions Demonstrates how technology can be used to improve consumer experience Illustrates why information systems are so essential today Copyright © 2019 Pearson Education Ltd. How Information Systems are Transforming Business In 2016, more than 142 million businesses had dot-com addresses registered. 273 million adult Americans online; 183 million purchased online Internet advertising continues to grow at around 15 percent per year. New laws require businesses to store more data for longer periods. Changes in business result in changes in jobs and careers. Copyright © 2019 Pearson Education Ltd. What’s New in Management Information Systems? New technologies – Cloud computing: is emerging as a major business area of innovation that offers a flexible collection of computers on the Internet that can perform tasks previously performed on corporate​computers. software as a service (SaaS) is an example of cloud computing and it means: A collection of computers on the Internet that allow for innovations and simply called​the Cloud – Big Data and Internet of Things (IoT): identify insights in huge volumes of data from web​traffic, email​messages, social media​content, and​Internet- connected machines​(sensors) – Mobile digital platform Management – Managers use social networks, collaboration – Business intelligence applications accelerate – Virtual meetings proliferate Organizations – Social business – Telework gains momentum – Co-creation of value, collaboration across firms Copyright © 2019 Pearson Education Ltd.  Business Drivers of Information Systems Businesses invest in IT to achieve six important business objectives. 1. Operational excellence 2. New products, services, and business models 3. Customer and supplier intimacy 4. Improved decision making 5. Competitive advantage 6. Survival Copyright © 2019 Pearson Education Ltd. Operational Excellence Improved efficiency results in higher profits. Information systems and technologies help improve efficiency and productivity. Example: Walmart – Power of combining information systems and best business practices to achieve operational efficiency— and over $473 billion in sales in 2014 – Most efficient retail store in world as result of digital links between suppliers and stores Copyright © 2019 Pearson Education Ltd. New Products, Services, and Business Models Information systems and technologies enable firms to create new products, services, and business models. Business model: how a company produces, delivers, and sells its products and services Example: Apple – Transformed old model of music distribution with iTunes – Constant innovations—iPod, iPhone, iPad, etc. Copyright © 2019 Pearson Education Ltd.  Customer and Supplier Intimacy Customers who are served well become repeat customers who purchase more. – Mandarin Oriental hotel ▪ Uses IT to foster an intimate relationship with its customers, keeping track of preferences, and so on Close relationships with suppliers result in lower costs. – JCPenney ▪ IT to enhance relationship with supplier in Hong Kong Copyright © 2019 Pearson Education Ltd. Improved Decision Making If managers rely on forecasts, best guesses, and luck, they will misallocate employees, services, and inventory. Real-time data improves ability of managers to make decisions. Verizon: Web-based digital dashboard to update managers with real-time data on customer complaints, network performance, and line outages Copyright © 2019 Pearson Education Ltd. Competitive Advantage Often results from achieving previous business objectives Advantages over competitors: – Charging less for superior products, better performance, and better response to suppliers and customers – Examples: Apple, Walmart, UPS are industry leaders because they know how to use information systems for this purpose Copyright © 2019 Pearson Education Ltd. Survival Businesses may need to invest in information systems out of necessity; simply the cost of doing business. Keeping up with competitors – Citibank’s introduction of ATMs Federal and state regulations and reporting requirements – Toxic Substances Control Act and the Sarbanes- Oxley Act Copyright © 2019 Pearson Education Ltd. What is an Information System? (1 of 2) Information technology: the hardware and software a business uses to achieve objectives Information system: interrelated components that manage information to: – Support decision making and control – Help with analysis, visualization, and product creation Data: streams of raw facts Information: data shaped into meaningful, useful form Copyright © 2019 Pearson Education Ltd. Figure 1.1 Data and Information Raw data from a supermarket checkout counter can be processed and organized to produce meaningful information, such as the total unit sales of dish detergent or the total sales revenue from dish detergent for a specific store or sales territory. Copyright © 2019 Pearson Education Ltd. What is an Information System? (2 of 2) Activities in an information system that produce information: – Input – Processing – Output – Feedback Sharp distinction between computer or computer program versus information system Copyright © 2019 Pearson Education Ltd.  Figure 1.2 Functions of an Information System An information system contains information about an organization and its surrounding environment. Three basic activities—input, processing, and output— produce the information organizations need. Feedback is output returned to appropriate people or activities in the organization to evaluate and refine the input. Environmental actors, such as customers, suppliers, competitors, stockholders, and regulatory agencies, interact with the organization and its information systems. Copyright © 2019 Pearson Education Ltd. The Role of People and Organizations Information systems literacy – Includes behavioral and technical approach Computer literacy – Focuses mostly on knowledge of IT Management information systems (MIS) – Focuses on broader information systems literacy – Issues surrounding development, use, impact of information systems used by managers and employees Copyright © 2019 Pearson Education Ltd. Figure 1.3 Information Systems are More Than Computers Copyright © 2019 Pearson Education Ltd. Dimensions of Information Systems (1 of 4) Organizations – Coordinate work through structured hierarchy and business processes – Business processes: related tasks and behaviors for accomplishing work ▪ Examples: fulfilling an order, hiring an employee ▪ May be informal or include formal rules – Culture embedded in information systems: Fundamental set of assumptions, values, and ways of doing things, that has been accepted by most of its members. ▪ Example: UPS’s concern with placing service to customer first Copyright © 2019 Pearson Education Ltd. Dimensions of Information Systems (2 of 4) People – Information systems require skilled people to build, maintain, and use them. – Employee attitudes affect ability to use systems productively. – Role of managers: ▪ Perceive business challenges ▪ Set organizational strategy ▪ Allocate human and financial resources ▪ Creative work: new products, services Copyright © 2019 Pearson Education Ltd. Dimensions of Information Systems (3 of 4) Technology – IT Infrastructure: Foundation or platform that information systems are built on. It consist of: ▪ Computer hardware: Physical equipment used for input, processing, and output activities in an information system. ▪ Computer software: Instructions that control and coordinate the computer hardware components in an information system. Data management technology: Software governing the organization of data on physical storage media. Copyright © 2019 Pearson Education Ltd. Dimensions of Information Systems (4 of 4) ▪ Networking and telecommunications technology: Physical devices and software, links the various pieces of hardware and transfers data from one physical location to another. Sharing voice, data, images, sound, and video. – Internet: a global network of networks that uses universal standards – Web page: Contain text, graphics, animations, sound, and video and are linked to other web pages. – World Wide Web: Service on Internets that uses universally accepted standards for accessing web pages – Extranets: Private intranets extended to authorized users outside the organization – Intranets: Internal corporate networks based on Internet technology – Voice, video communications Copyright © 2019 Pearson Education Ltd.  The Problem-Solving Approach Few business problems are simple or straightforward. Most business problems involve a number of major factors that can fall into three main categories: – Organization – Technology – People A Model of the Problem-Solving Approach Problem solving: four-step process 1. Problem identification 2. Solution design 3. Choice 4. Implementation Copyright © 2019 Pearson Education Ltd. Figure 1.4 Problem Solving is a Continuous Four-Step Process During implementation and thereafter, the outcome must be continually measured, and the information about how well the solution is working is fed back to the problem solvers. In this way, the identification of the problem can change over time, solutions can be changed, and new choices can be made, all based on experience. Copyright © 2019 Pearson Education Ltd. A Model of the Problem-Solving Approach (1 of 6) 1. Problem identification includes: – Agreement that problem exists – Definition of problem – Causes of problem – What can be done given resources of firm Copyright © 2019 Pearson Education Ltd. A Model of the Problem-Solving Approach (2 of 6) Typical organizational problems – Outdated business processes – Unsupportive culture and attitudes – Political in-fighting – Turbulent business environment, change – Complexity of task – Inadequate resources Copyright © 2019 Pearson Education Ltd. A Model of the Problem-Solving Approach (3 of 6) 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 Copyright © 2019 Pearson Education Ltd. A Model of the Problem-Solving Approach (4 of 6) 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 Copyright © 2019 Pearson Education Ltd. A Model of the Problem-Solving Approach (5 of 6) 2. Solution design – Often many possible solutions – Consider as many as possible to understand range of solutions 3. Solution Evaluation and Choice – Factors include ▪ Cost ▪ Feasibility given resources and skills ▪ Length of time needed to implement solution Copyright © 2019 Pearson Education Ltd. A Model of the Problem-Solving Approach (6 of 6) 4. 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 Copyright © 2019 Pearson Education Ltd.