Information Systems and Digital Trends PDF

INFORMATION SYSTEM AND DIGITAL TRENDS LESSON 2: INFORMATION SYSTEMS, ICTs AND DIGITAL SCENARIOS MEANING OF DIGITAL → “digital” comes from digit (number) Generally with digital we talk about information and communication technology. Specifically, it is something related to numbers such as 0-1. Thes...

INFORMATION SYSTEM AND DIGITAL TRENDS LESSON 2: INFORMATION SYSTEMS, ICTs AND DIGITAL SCENARIOS MEANING OF DIGITAL → “digital” comes from digit (number) Generally with digital we talk about information and communication technology. Specifically, it is something related to numbers such as 0-1. These numbers are related to binary language and they correspond to power on/ power off. 0-1 are the only 2 elements that the computer is able to understand. The digital language is a numeric language based on a binary language. Every time we digit something on a keyboard it is immediately transformed into a sequence of 0 or 1. Each 0 or 1 takes the name of bit (binary digit) =the smallest unit of information that is held in a computer’s memory. It’s either 0 or 1. Our world is not digital, but manual. There is never just 0 and 1, there is something in the middle. For ex. time it is a continuous entity In order to talk with computers the world has adapted to using a digital representation. Years ago the modem was an essential device. The phone system was at first an analog system. To connect to the internet network, using the phone lines, there was a problem of translation. The modem (modulator) was able to translate the 0 and 1 into waves/sounds. Then another modem could translate the waves into 0 and 1. Now we use digital convergence: all the analogical lines are digital lines. This worked for any type of media. ex. - We switched from an analog to a digital tv (tv switch off). The decoder used a few years ago could transform the 0 and 1 into waves. Now all the televisions are digital so we don’t need decoders. - In the last 25 years, documents have also become digital. Nowadays most of the books are digitals. - Radio, for instance, is no longer available only using the radio device. We can use it on our phones now. The radio is not disturbed anymore, you don’t hear the waves. Today the networks of the radio are able to send us pictures or a text at the same time that the music plays. This is because 0 and 1 are translated. All this because radio has been digitalized. BIT (binary digitals) AND BYTES 1 BYTE= 8 bits → one BYTE is a sequence of 8 bits Why is it so? At the very beginning computers were only talking 0 and 1. But there was the necessity to find a way to speak our language and get it translated into the computer one. 00= A 01=B They decided that the string of bytes able to transform any symbol or number or letter was transformed into 8 bits. Later they created a common table of translation that anyone would be able to use. The first one was called ASCII: no matter the device, every time the letter A is digit the computer understands it with a sequence of bits. With 8 bits you can create 256 different combinations that are enough to cover any symbol, letter of our language. The problem was that this method only covered English since it was invented in America. How could it cover other languages? The ASCII table used only one bite. They invented a different table of coding called UNICODE that exists in a 32 bit sequence with which you can cover 32 billion different characters used in any other language. Each letter in the UNICODE is occupying 32 bits. Each letter is 4 bytes=32 bits. UNICODES might be slightly different from one another depending on the device. Not just letters or numbers are decoded but also other images. How can something be transferred from a device to another? For any type of content we are using there is a decoding system. BIT and BYTE are also able to detect the size of the characters (giga/mega bytes) How? Why is a kg 1000 g and a byte is not? They are calculated on a 10x base power but on 2power10 bytes. Nowadays we have a lot of multiples of bytes. Everyday we are creating new bytes and data. This could lead to a problem of information overload which could generate an information democracy issue. *When we search in google we know only just 1% of the information on google and it is decreasing. TECHNOLOGY AND ICT - Technology is the way we apply scientific knowledge for practical purposes. It includes machines (like computers) but also techniques and processes (like the way we produce computer chips). ex. a hammer and the wheel are two examples of early human technology. - Information and communications technology (ICT) is technology that is used to handle information storage, retrieval, management and communications. ICT is more than an extended synonym for information technology (IT). It is used to describe the convergence of IT and TLC. → With ICT we refer to hardware, software and networks. Information system represents something that is not physically touchable. SYSTEM → A set of interrelated components, with a clearly defined boundary, working together to achieve a common set of objectives by accepting inputs and producing outputs in an organized transformation process. A system is a set of components that has a specific purpose that takes inputs and transforms them into outputs. *The database cannot be a system because it is a single element. It’s a collection of data. examples of information systems: - the atm information of system ex. information that an information system produces that is relevant for its activity What is an Information System? → A set of interrelated components which are to collect, process, store, and distribute information to support decision making and control in an organization An information system is made of 6 key components aimed at collecting, analyzing, and distributing useful information: - hardware - software - telecommunication - networks - data - people - processes → Aimed at collecting, analyzing, and distributing useful data and information. ICT and information systems are not the same thing. ICT is just a component of the information system. DATA, INFORMATION, KNOWLEDGE → Data is raw facts, typically about physical phenomena or business transactions. It a number, a letter that doesn’t have a real meaning if not combined with something else → It becomes information when combine in a meaningful matter or contextualized The information system picks into a million of data and transform them knowledge. Is the final step of the information system coffee machine > ex → Knowledge is the ability to understand information, form opinions, and make decisions or predictions INVENTIONS AND INNOVATIONS Technologies nowadays are not just inventions. In the last they were more or less always successful being then innovations. Invention → introduce something new to the market → to understand inventions we need technology Innovation → manipulate existing inventions and turn them into a product or process that is of use in the real world → to understand inventions we need technology, social cultural factors and marketing factors Invention creates something new, innovation creates something that sells. Most of the tools we are using today are super smart innovations. Many inventions will not become innovations. LESSON 3: HARDWARE, SOFTWARE, NETWORK AND THE INTERNET Hardware & Software - Hardware is everything you can physically touch and see of a computer. Ex: Monitor, hard drive, CD-ROM, computer cables, keyboard, mouse, modem, printer, etc. - Software is everything that we can’t touch and see of a computer (intangible). DIFFERENT TYPES OF COMPUTER In the history of computers there are many types of computers different from the present ones that are still used in many organizations. We can distinguish many different types of computer: GENERAL PURPOSE MACHINE→ created to process any type of activity as the number of application installed on them: > microcomputer → designed for personal usage, don’t cost too much, typically small devices, limited processing memory capability ex. - smartphones (mobile devices) - personal computers (desktop, laptop, tablet) > minicomputer → mid size computers which are not only designed for personal usage, they have a much higher cost and memory capability, they manage multiple connections at the same time and they are able to answer to any question that it is receiving ex. - server (any organization present on the web owns at least one) - workstation > mainframe computer → really big size computers, they are machine used in large corporations to use huge amount of data, they have a very high cost and a high memory capability Companies who need to process huge amounts of data use these computers (ex. instagram, amazon). MONO PURPOSE COMPUTER→ they perform only a specific task: > supercomputer → they go under the umbrella of the mainframe but it is different in the usage (like scientific research). SOFTWARE - corresponds to programs and applications - part of the computer that cannot be seen (intangible) - needed for computer to function - designed to solve common or custom problems System vs Application software (ex. Whatsapp) are part of a software: System software / operating system (ex. Windows, IOS, Linux) → operating system They are an essential part of a system that enables the hardware and all the other application systems to work. ex. - z/OS → proprietary operating system for large IBM mainframe systems - Unix → multi user, multitasking operating system, commonly used because of its superior activity - Windows → the most popular in the world - Mac OS → first commercial graphical-based operating system, making its debut in 1984; the operating system of Apple computer - Linux → open source operating system designed in 1991 by a Finnish student; it powers one.third of all web servers - Android → Google’s Linux-based operating system for mobile devices - IOS → Apple’s mobile operating system, previously named Iphone OS, also used on the Ipod Touch and Ipad Each different hardware has its own operating system. System software tasks: - starting / booting the computer - read programs into memory - manage files and their allocation and hardware connected to the computer - maintaining the structure of directories and subdirectories - formatting disks - controlling computer monitor - sending documents to the printer Application software: - word processing software - electronic spreadsheet software - database software - presentation software - communication software HOW DOES A COMPUTER WORK? Each time the computer is performing any kind of activity it is also performing in loop 4 types of operations which are processed into input, process, output and storage. The 4 component of a computer: - input devices, they enable the user to enter data (ex. mouse, keyboard, webcam, scanner, touch screen, OCR) 1- processor devices, is made of 2 component: > central processing unit (CPU - brain of the computer) - It interprets instructions to the computer - performs logical and arithmetic operations - causes the input and output operations to occur It performs 800 million instructions per second (MIPS) > central memory → it is made by the RAM (Random Access Memory, 99%) - computer’s primary storage of data to be processed - silicon chips that store data and instructions as electronic signals - CPU can manipulate electrical signals - contents of RAM will be lost when power is turned off There is another type of central memory, known as ROM (Read Only Memory, 0.1%) Instruction and data are hard coded on the silicon chips. (ex, BIOS → Basic Input - Output System → it gives the computer the initial instructions to get it started once the computer is turned on. When we switch off our devices that is still the ROM memory that is still alive and processing. - output devices , they make the information resulting from processing available for use (ex. printers, computer screens, speakers) - (auxiliary) storage devices ( secondary storage devices - secondary memory of the computer), they save the results of the computer permanently (ex. hard drives, CD-ROM, tape backup drives, ZIP drives) COMPUTER NETWORK It is composed of: - 2 or more computers (hosts) - transmission medium (cable, wireless) - a protocol (set of rules) dictating communication types of Network: - personal area network (PAN) wireless communication between devices (bluetooth) size: under 10 meters - local area network (LAN) sharing of data, software, applications or other resources between several users size: typically within a building - wide area network (WAN) connect multiple LANs, often with distributed ownership and management size: large physical distance spanning multiple buildings or the area of a city to worldwide (Internet) ex. - metropolitan area network (MAN) → connects all the metropolitan area networks - one area network, ONE biggest one (ex. VISA, MASTERCARD, Internet) - campus area network - global network - enterprise WANs INTERNET The Internet network is very unique: - It’s a WAN, a global and wider network (it’s often called the network of networks) - no one owns it - it has no formal management of organization - it is not centralized - it is base on a strange and unique protocol called TCP/IP History It was created in the USA during the Cold War. The Department of Defence of the US commissioned a very specific project, the DARPA project: they wanted a network where the data could reach its final destination even if the bombs would have destroyed the cables. Originally it was called Arpanet. The first message in October 1969 was ‘LO’ instead of LOGIN. In 1972 Arpanet reached 37 hosts/TCP/IP. In the 80s they created 3 different networks inside Arpanet: - NSFnet (National Science Foundation Network) - BitNet (Because It’s Time Network) - CSnet (Computer Science Network) The TCP IP of today was the same that was used in the past and it wasn’t changed in any way. This makes the Internet unique. In 1983 they switched the name from Arpanet to Internet. In 1991 the world wide web was invented. The Internet is the network. The WWW is just one of the applications that works in the Internet Network. The Internet evolved incorporating different types of applications like emails, WWW, whatsapp ecc. Packet Switching System → It's a way of how the Internet Network works (different from the Circuit Switching System) The Internet was created on a different type of approach. - Current data networks use packet switching - messages are broken up into packets, which are sent individually to the destination - the receiving computer assembles the packets back into the message - this allows packets from different messages to be intermingled on the network TCP/IP It is the Internet's standard communication language, it dictates how messages are broken into packets and later reassembled. The Internet is a safe network because to stop it is not enough to stop the 99% of the infrastructure, you need to destroy it all. IP ADDRESSING Each computer on the Internet does have a unique identification number, called an IP (Internet Protocol) address. The IP addressing system currently in use on the Internet uses a four-part number (four bytes). Each part of the address is a number ranging from 0 to 255, and each part is separated from the previous part by period (for example, 106.29.242.17). The combination of the four IP address parts provides 4.2 billion possible addresses (256 x 256 x 256 x 256). This number seemed adequate until 1998. Members of various Internet task forces are working to develop an alternate addressing system that will accommodate the projected growth (IPv6). However, all of their working solutions require extensive hardware and software changes throughout the Internet. In reality we are never connected to the Internet, but to the Internet service provider. ex. when we send our credit card number it goes from our device to an Internet service provider and it goes around the Internet. By the end of 2025 an IP4 will be transformed into a IPv6 version made of 128 beats which will allow many more combinations that will be enough probably for two decades to come. DOMAIN NAME ADDRESSING Fortunately we do not use the IP address to locate Web sites and individual pages, but a domain name addressing. → A domain name is a unique name associated with a specific IP address by a program that runs on an Internet host computer. This program, which coordinates the IP addresses and domain names for all computers attached to it, is called DNS (Domain Name System). The host computer that runs this software is called a domain name server. Domain names can include any number of parts separated by periods, however most domain names currently in use have only three or four parts. Domain names follow a hierarchical model that you can follow from top to bottom if you read the name from the right to the left. For example, the domain name gsb.uchicago.edu is the computer connected to the Internet at the Graduate School of Business (gsb), which is an academic unit of the University of Chicago (uchicago), which is an educational institution (edu). No other computer on the Internet has the same domain name. Top-level Domains (TLDs) - Generic Top Level Domains (gTLDs).com - commercial organizations.org - not-for-profit organizations.edu - educational organizations.mil - military organizations.gov - governmental organizations.net - network service providers New:.biz,.info,.name, … Country code Top Level Domains (ccTLDs) One for each country The Internet and the World Wide Web (WWW) - The Internet is a large worldwide collection of networks that use a common protocol to communicate with each other It is based on internetworking, or combining networks to form larger networks.  - The World Wide Web is one of the many application running on the Internet Web protocols (e.g., HTTP): → Web pages (documents containing HTML) → Web servers (provides access via a Web site) → Web browsers (provides interface to Web pages) HyperText Transfer Protocol (HTTP) An application (or transfer) protocol is the set of rules that the computers use to move files from one computer to another on the Internet. The most common transfer protocol used on the Internet is the Hypertext Transfer Protocol (HTTP). Two other protocols that you can use on the Internet are the File Transfer Protocol (FTP) and the SMTP Protocol (for email). Hypertext Markup Language (HTML) The public files on the web servers are ordinary text files, much like the files used by word-processing software. To allow Web browser software to read them, the text must be formatted according to a generally accepted standard. The standard used on the web is Hypertext markup language (HTML). Hypertext Markup Language (HTML) HTML uses codes, or tags, to tell the Web browser software how to display the text contained in the document. For example, a Web browser reading the following line of text: A Review of the BookWind Instruments of the 18th Century recognizes the and tags as instructions to display the entire line of text in bold and the and tags as instructions to display the text enclosed by those tags in italics. Extranets and Intranets (1 of 2) Companies have confidential data, which still need to be shared on a limited basis. - Intranet: password-protected Web site designed for sharing within the company - Extranet: password-protected Web site designed for sharing with select partners Data and communication are protected via fire-walls and virtual private networks (VPNs)  LESSON 4: IS: HOW TO GAIN COMPETITIVE ADVANTAGE Decisions You need data and information (which are part of an information system) mainly for 1. Doing something 2.Taking decisions → Structured decisions: those in which procedures to follow for a given situation can be specified in advance. You have a certain level of certainty. → Unstructured decisions: those in which procedures to follow for a given situation cannot be specified in advance. You don’t know the consequences of your decision. Decision-Making levels of an organization A company is a social entity, it’s made of people. In a company we can find 3 different levels of people: 1. executive level (chiedi*) 2. managerial level (chiefs of different units, they people who collect information coming from the executive level and they decide the aim for the short period; they as the operational level to do things) 3. operational level (people who work at the offices, they perform standard activities which not so strategic in the decision making process) IS inside organizations There are different types of information systems according to different decision making levels of an organization. → operational level - day-to-day business processes - they take structured, recurring decisions - following actions and processes can often be automated using IS - IS used to automate and optimize processes, and understand causes of performance problems - their main aim is to increase EFFICIENCY which results in doing things faster, reducing the resources involved (like human resources) and also reducing mistakes. This allows them to have the ability to accomplish a job with a minimum expenditure of time and effort The purpose of an operational system is to make the company run. This involves transaction processing, and lots of updates to the database. In order to support the actions at the operational level we need a TPS (Transaction Processing Systems) that can:  process day-to-day activities collect data generated by these activities Used by a broad range of organizations TPS are used by a broad range of organizations like for example bank systems for managing your bank account or the grocery store for the checkout cash register with connection to the network. Databases → Collection of related and structured data organized in a way that facilitates data searches Entering and Querying Data The activity of entering data is typically managed through the use of forms. Form can be used to enter new data, update or delete existing data, or create reports. They use the data to produce information. → managerial level Midlevel managers and functional managers - Monitor and control operational-level activities - Focus: effectively utilizing and deploying resources - Goal: achieving strategic objectives Managers’ decisions - Semistructured - Moderately complex - Time horizon of few days to few months IS can help by supporting business decisions with: - performance analytics (dashboards) - predictive analysis - providing key performance indicators (KPI). To support the activity made by managers we need DSS –Decision Support Systems or BI-Business Intelligence (systems): - Business Intelligence (BI) is the use of information systems to gather and analyze information from internal and external sources in order to make better business decisions. BI is used to integrate data from disconnected: - Reports - Databases - Spreadsheets → Integrated data helps to monitor and fine-tune business processes. BI systems search for hidden relationships & work on Information and knowledge discovery. For example: Customers with a household income over $150,000 are twice as likely to respond to our marketing campaign as customers with an income of $60,000 or less. How BI systems differ from operational thinking - BI systems → broad and complex queries and analyzes - Databases → narrow and simple queries and analyzes Managers use the answers to these questions to plan the strategies for the future (like the ones in a year to come). - Business Intelligence systems (or Decision Support Systems) It helps organizations make sense of the big amounts of data they collect. Data organization is key to being able to quickly retrieve needed data to help make critical business decisions. Business Process Supported by Functional Area IS - discovering “hidden” predictive relationships in the data ( For example: to discover the characteristics of most profitable customers, purchasing patterns or fraudulent credit card transactions) - complicated algorithms run on a big quantity of data → executive level - president, CEO, vice presidents, board of directors - decisions: - unstructured - long-term strategic issues - complex and nonroutine problems with long-term ramifications - IS is used to obtain aggregate summaries of trends and projections, and provide KPIs across the organization To support the activity made the executive level we need the ESS-Executive Support Systems → It is represented by a digital dashboard, which use various graphical elements to highlight important information Gaining Competitive Advantage Through Information Systems Major IS Tasks: Business Value Added - Automating: doing Things Faster - Organizational Learning: doing Things Better - Supporting Strategy: doing Things Smarter  LESSON 5-6: FROM CLOUD COMPUTING TO COLLABORATIVE ECONOMY ICT DRIVEN IS EVOLUTION Information system worked for many years without technological support. It went through 3 phases: 1. transaction processing (1960-80) Until then any information system was working without technology. Information technology was only processing transactions into the manufacturing process. In 1960 the first mainframe was introduced that travel agencies/organizations started to acquire in order to make quicker operations that originally were made manually. It’s the phase of the calculator effect. 2. business resource (1980-2000) Around 1980 for the first time computers were not the only main frame, but personal computers were introduced. Quickly information and communication technology into organization started to be a core business resource. 3. strategic tool (2000-now) ICT started to play a more relevant role in organizations. It became a strategic tool able to compete on the market according to the other operators. Any company that today is digital by competition uses a strategic tool. What determined this evolution is: - management level → originally in the first period technology was addressed only on the low level of management. This changed dramatically. Today it is used on the top management level. - system complexity → today's computers have a very complex interconnection of hardware, software and network , they are not just mainframe operational level → 1960 → It used TPS (transaction processing system) It is a system used by low level people in an organization knowledge level → It used OAS (office automation system) and KWS (knowledge working system) It is addressed to the higher level. They are systems that can help knowledge workers/white collar workers to do their job. ex. CAD system strategic tool level → It uses ESS (energy storage system), MIS (management information system), DSS (decision support system) They are systems that enable managers to perform their activities. Four main stages of evolution in terms of system complexity: 1. batch (late 50s-early 70s) → introduction of mainframe → centralized architecture (one computer at the center of the organization is transactioning faster) 2. real time (early 70s-mid 80s) →introduction of dumb terminal (technological terminal able to connect the user with the center of the organization)  → centralized architecture (still just one computer in the center of the organization connected to the rest of the organization thanks to the dumb terminal) 3. pc revolution (mid 80s-early 90s) → introduction of PCs → client/server architecture Technology reached the highest level possible with computers and smartphones. 4. today → cloud computing CLOUD COMPUTING In the simplest terms, cloud computing means storing and accessing data and programs over the Internet instead of your computer's hard drive. The cloud is just a metaphor for the Internet. Cloud computing is a type of computing architecture that relies on shared computing resources rather than having local servers or personal devices to handle applications. Cloud computing is the on-demand availability of computer system resources, especially data storage and computing power. FROM OUTSOURCING TO CLOUD COMPUTING outsource → give outside Business practice where the corporation decides to give to someone else some specific tasks to perform outside. It is done: - to save time - to increase the efficiency - control costs - expertise - flexibility In order to understand cloud computing we need to start from outsourcing. TYPES OF CLOUD COMPUTING 1. IAAS (Infrastructure as a Service) → lightest one (used for ex by banks) 2. PAAS (Platform as a Service) → I retain at home the application and the data 3. SAAS (Software as a Service) THE MAIN CHALLENGES OF THE DIGITAL WORLD AND DIGITAL SUSTAINABILITY In our ever-connected society, the digital world offers both opportunities and challenges. Focus on three major challenges: Information overload → constant bombardment of information Impact: Harder to filter important information, affecting mental health and decision-making. Significant Data: - 1.80% of people feel overwhelmed by the amount of data they need to process daily (source: Deloitte). - 2.3.6 billion people globally use social media, contributing to informational overload (source: Statista). Digital Pollution → environmental impact of digital activities, like data storage and streaming. Impact: Energy consumption and carbon emissions are growing. Significant Data: - 3.7% of global greenhouse gas emissions are due to digital activities— similar to the airline industry (source: The Shift Project). - Streaming 1 hour of video emits 55 grams of CO2, comparable to driving a car for 0.3 miles (source: Carbon Trust). Ethics and Security → it concerns surrounding data management. Impact: Privacy, misinformation, and rights of users are at risk. Significant Data: - 1.30% of data breaches are linked to ethical mismanagement or lack of proper security (source: IBM Security). - Over 4.5 billion records were exposed in the first half of 2023 due to security vulnerabilities (source: Risk Based Security). The path forward These challenges are deeply interconnected: Informational Overload Feeds Digital Pollution → the massive production of digital content leads to an excessive amount of data being stored and processed. This, in turn, consumes significant amounts of energy, contributing to digital pollution. Digital Pollution Increases Security and Ethical Risks → as the volume of digital activities grows, so do the risks related to dasta security and ethical concerns. More data means more opportunities for breaches, misuse, and misinformation, making it difficult to ensure ethical digital practices. Addressing these interconnected challenges requires a holistic approach. Promoting digital sustainability involves reducing unnecessary digital content and optimizing data usage to minimize environmental impacts. Implementing ethical frameworks is essential for responsible data management and protecting user rights. Finally, encouraging digital minimalism can help individuals focus on what truly matters, reducing cognitive fatigue and the strain on digital infrastructure. Together, these strategies are crucial for building a secure and sustainable digital future. From Cloud Computing To Collaborative Economy Crowdsourcing Crowdfunding Sharing Economy Gig Economy A collaborative economy is a marketplace where consumers rely on each other instead of large companies to meet their wants and needs. It is sometimes called crowd economy (because people rely another crowd) or platform economy (because the technology is just in the middle, while the crowds of people are outside on both sides, in order to moderate the the interaction between the demand and the offer made by the crowd). Information systems can be used to support innovation. Many companies have gained potential by using information technologies. Nowadays IT is very pervasive. There ar four types of collaborative platforms/crowd economy, differing from wha you have to exchange: 1. crowd funding: if you have a market where what is excchanged is money, but on both sides of the market there is crowd = the practice of funding a project or venture by raising money from a large number of people who each contribute a relatively small amount, typically via the Internet The different types of crowdfunding are: Reward Crowdfunding (as a crowd I contribute to a funding of an initiave and in exchange I get back a reward, typically a product that the company is producing) Donation Crowdfunding Asset Crowdfunding (by contributing to the company, I get back equity, shares) Lending Crowdfunding ex. LendingClub 2. crowd sourcing: if on both sides of the market there is crow, and is exchanged is the knowledge of people = the practice of obtaining information or input into a task or project by enlisting the services of a large number of people, either paid or unpaid, typically via the Internet Unpaid (socially rewarded, e.g. giving visibility) Paid (the crowd gets paid) (Amazon mechanical turk) Unconscious (we are working for something without knowing)  ex. Waze, PrezziBenzina 3. sharing economy: if what is exchanged are staff services =an economic system in which assets or services are shared between private individuals, either free or for a fee, typically by means of the ICT ex. Air B&b, Uber (in the original version) 4. gig economy: if what is exchanged is labour = a labour market characterized by the prevalence of shorter contracts or freelance work as opposed to permanent jobs ex. any food delivery company These 4 are just subsets of a more generic public economy called collaborative economy. LESSON 7: ICT AND DIGITAL MARKETS: ENABLING COMMERCE BY USING THE INTERNET AND DEFINING NEW BUSINESS MODELS ELECTRONIC COMMERCE → It is defined as the exchange of goods, services, and money among firms, between firms and their customers, and between customers, supported by information systems embedding ICTs and, in particular, the Internet. Types of good and services: services physical products digital products, such as software, music, movies, and digital images E-COMMERCE BUSINESS STRATEGIES There are 3 main business strategies based on levels of physical/virtual presence: 1- brick and mortar → physical location → traditional stories, there is no activity of e-commerce → limited geographical reach: people must be in the same place to buy products and services 2- click-only → business conducted online only no physical location → pure-player → sometimes customers are uncomfortable with online transactions 3- click and mortar → companies use both online and offline channels → multi channel value proposition → hybrid strategy → added complexity climbing two different environments → more complicated to manage The evolution of multichannel retailing → Multichannel retailing At the very beginning there were different channels and customers could choose one channel, but they had to start and finish the purchasing process by using that specific one. → Cross-channel approach You can use different channels inside the same purchase process. This satisfies the customers, but from the managerial point of view of companies is more difficult to support. → Omni-channel retailing It considers all the channels as a unicom. There are no defined boundaries between online and physical contexts. It uses all channels to create the best shopping experience for customers. MOST COMMON TYPES OF ELECTRONIC COMMERCE 1. business-to-consumer (B2C) → transactions between businesses and their customers → it is the most common → opportunity to sell/purchase 24/7/365 → firms from across the world can potentially compete for customers and gain access to new markets → opportunity to better profile customers → disintermediation: cutting out the “middleman” (for example, wholesaler, retailer) and reaching customers more directly and efficiently → new intermediaries Drawbacks (disadvantages): - trust - direct product experience - product delivery and returns 2. business-to-business (B2B) → transactions among businesses → it involves exchanges between two or more businesses; these exchanges do not include end customers (consumers) → supply chain—companies and processes moving products from suppliers of raw materials to suppliers of intermediate components, to final production, to the customer → it allows many buyers and many suppliers to interact → some operate within a vertical market (industry-specific); others are not industry-specific 3. consumer-to-business (C2B) → transactions between customers and businesses → consumers sell to businesses → stock photo sites such as www.istockphoto.com → relatively new phenomenon, consumers can sell small pieces of work (e.g., photos) or services to businesses 4. consumer-to-consumer (C2C) → transactions between people not necessarily working together NEW ECONOMY When and how companies started competing online? It started in the middle of the 1990s: companies started using the Internet as a distribution channel. As an application context there was only the world wide web. With a very low internet connection, people could surf the internet network. Companies started competing online creating the first commerce websites. The companies of this period were called dot-coms and they did most of their business on the Internet: Dot > spoken form of a full stop in an URL Com > TLD, identifying commercial business The euphoria around the new opportunities offered on the world wide web identified the new economy. The main businesses of these dot-coms were Amazon.com, Pets.com, boo.com, webvan.com, etoys.com, kozmo.com. This euphoria across the markets led to a speculative bubble: dot-com bubble, investors asked for stock options at any valuation, in any dot-com company, especially if it had one of the Internet-related prefixes or a ".com" suffix in its name. BACK TO OLD ECONOMY > NASDAQ crisis: March 10th 2000 At one point, this bubble burst. The American financial market realized that behind this dot-com market there were some companies that were using new technologies without having any idea about the business they were running. This led to failures and disillusions. Customers could buy from the websites, but they had a problem with the delivering process. They lost money coming from the investors. DEFINING NEW BUSINESS MODELS NOWADAYS → A business model is a summary of a business’s strategic direction that outlines how the objectives will be achieved; it includes how a company will generate revenue and identifies its product offerings, value-added services, revenue sources, and target customers. As is the case with any «traditional» business, companies must develop a business model to be successful with EC. → convergence between physical and digital world A business model reflects the following: 1. what does a company do? 2. how does a company uniquely do it? 3. in what way (or ways) does the company get paid for doing it? 4. what are the key resources and activities needed? 5. what are the costs involved? REVENUE MODELS IN THE DIGITAL WORLD A revenue model describes how the firm will earn revenue, generate profits, and produce a superior return on invested capital. Types of revenue Models: - advertising - freemium→ marketing approach companies use to obtain customers by offering something for free to build a large customer base and then charge a premium for unrestricted versions with more functionality - traditional sales - subscription - licensing - transaction fees/brokerage MANAGING IN THE DIGITAL WORLD: STARTUPS AND NEW BUSINESS MODELS Information technology has enabled new business models: - cutting out the middleman (bypassing traditional retail channels and interacting directly with customers) → Ex: Warby Parker (eyeglass vendor) and Casper (mattress seller) use technology to disrupt traditional distribution channels and directly connect with buyers - operating a platform (enables other businesses/users to co-create value) - providing on-demand services Platform-Based Business Models A digital platform allows companies and consumers to collaborate in creating (co-creating) and consuming value. Service-Based Business Models - under a service-based business model, a manufacturer can offer equipment services as well as the product - business model based not on selling products, but on delivering them as services on demand - this is also referred to as XaaS (X as a service)  LESSON 8: DIGITAL TRANSFORMATION AND DIGITAL TRENDS DIGITAL TRANSFORMATION → Generally, it is the integration of digital technology into all areas of a business, fundamentally changing how the company operates and delivers value to customers. It's also a cultural change that requires organizations to continually challenge the status quo, experiment, and get comfortable with failure. Digital transformation involves a change in leadership, different thinking, the encouragement of innovation and new business models, incorporating digitisation of assets and an increased use of technology to improve the experience of your organisation’s employees, customers, suppliers, partners and stakeholders. A business may take on digital transformation for several reasons. Sometimes, it's a survival issue. Enabled by very well known ICTs and by new ones. Digital trends that shape the digital future: social media, Internet of Things, mobile, Big Data, cloud computing, artificial intelligence DIGITAL TRENDS Changes in society and in businesses: - internet of things - artificial intelligence - social media - cloud computing - big data - mobile New digital trends, together with existing IS, support and enable the digital transformation. In general terms, it is the integration of digital technology into all areas of a business, fundamentally changing how the company operates and delivers value to customers. THE DIGITAL TRANSFORMATION AND THE FOURTH INDUSTRIAL REVOLUTION Industry 1.0 → 1784 → mechanization, steam power, weaving loom Industry 2.0 → 1870 → mass production, assembly line, electrical energy Industry 3.0 → 1969 → automation computers and electronics Industry 4.0 → today → cyber physical, systems, internet of things (IOT), networks The Fourth Industrial Revolution defines the current trend of automation, interconnection and data and information exchange inside organizations. It includes the Internet of Things, cloud computing, big data, mobile, artificial intelligence, and others.  LESSON 9: ENHANCING ORGANIZATIONAL DECISION MAKING THROUGH INFORMATION SYSTEM WEB 2.0 Users were able to create and publish content. It’s a new extremely friendly context with new applications able to support and advance interactivity. Comments, reviews, likes, shares, ‘’send to a friend’', blogs were all functions that created a context where the user was no longer passive, but content creator. Social networks and websites such as youtube and wikipedia allowed this. Users were willing to participate in the creation of content (text, videos, images) that would have been published online. This approach was defined as user-generated content (UGC). SOCIAL MEDIA AND THE ENTERPRISE Social media represents a pillar of the digital transformation. Using social media, organizations can enhance: - communication - cooperation and collaboration - connection The communication model changes, it becomes a dialogue, since there is the possibility for users to interact and react. In the 90s the communication model was represented by a monologue. The activity of advertisers managers have changed thanks to this model. The dialogue requires some activities: - listen to consumers all day (they can receive comments and feedbacks daily) - react to the comments that users are giving - engage with users ‘’Stop thinking about campaigns, start thinking about conversations'’. INTERNET OF THINGS (IOT) → It is defined as a broad range of physical objects that can automatically share data over the Internet without human intervention. They can share data and information about themselves and the environment around them. It improves the quality of life of people and of workers in that context. A device needs to be connected to the Internet to be able to collect and transmit sensory data. With the ability to connect things such as sensors, cameras, tags or detectors the potential for gathering useful data is limitless. ex. refrigerators that can tell you when products expire ex printers that alert your computer needs replacement Smart homes, smart cities, smart factories, e-health (like cardiac monitors alerting physicians of potential health risks) are all examples of IOT. Some objects can be inserted into the things you wear (wearable technologies→ like fitness trackers, smart glasses, smart watches). Companies can collect a lot of data and can use it to promote some products that fit with your profile. Challenges of IOT - data privacy and security (some data that are collected should be managed according to some rules in order to protect your privacy and your data security) - compliance - data ownership - data reliability/trust - data management How can this huge amount of data be processed and analysed by companies? They need softwares able to support this activity, which means spending a lot of money. Companies can use the cloud computing architecture in order to have an infrastructure of hardware and software that can collect this amount of data. MOBILE It is another important digital trend. It supports communication activity and new business models. It allows new business opportunities, since it also supports the new digital transformation. Mobile is a channel that supports communication. It is part of the omnichannel approach. Evolution of mobile The first mobile phone was born in 1963 thanks to Martin Cooper. It weighed 1.5 kg, the battery lasted 30 minutes and it took 10 hours to charge it. It was used only to call and receive calls. It was very expensive, that's why it was only used by business people. There are 5 generations used to describe the mobile revolution: - 1^ (1980s): the services it only offered voice It was defined as a total access cellular system (TACS). It provided an analog signal which allowed only the receiving and making of calls. This allowed people to use mobile phones only within national boundaries - 2^ (1990s): the services changed and became more sophisticated. It was defined as the global system for mobile communication (GSM). The signal was digital and the Sim Card was created (with the name of the owner, his phone number and data related to him). There was a possibility to receive and send short SMS (only texts) and it could be used by normal people. - 3^ (2000s): It was defined as the universal mobile telecommunication system.  It provides a further increase in data transfer rate (mobile broadband) You can call, message and send multimedia information services (like videos, images, videocall, attend a lecture). People can get access to the Internet with their mobile devices. - 4^ (starting from 2013 until today): mobile telecommunications It is defined as long term evolution (LTE). It allows high-speed connection and access to high quality multimedia services (high-definition video conferences, fast cloud computing access, TW shows/movies streaming) It resulted in an increase of users. Today we are in the middle between the 4^ and 5^ generation. We are still using the services of the 4^ but we are slowly entering the 5^. - 5^ generation (started four years ago in 2020): It should be able to connect a huge amount of devices but also to IOT to the Internet. It represents a high speed connection to the Internet. BIG DATA The digital trends social, the Internet of Things, as well as mobile, have led to a tremendous increase in potentially useful data: the increase in mobile devices, social media, automated sensors, and other devices generates unprecedented amounts of structured and unstructured data = BIG DATA Big Data are important since a key to effective management is high-quality and timely information to support decision making. Big Data refers to large and complex data sets that can not be processed by traditional data processing applications. With big data we refer to the use of predictive analytics or other advanced methods to analyze data and extract value Nowadays we have a lot of data, which causes an information overload. Why do organizations need reliable data and information? There is a strong linkage between effective data management and organizational performance. Information flow→ information that we deliver to people who need to make decisions Data come from different sources: - internet of things - social media - mobile The four main features of big data: - high volume (scale of data, unprecedented amount of data) - high variety (different forms of data: structured and unstructured data) - high velocity (analysis if streaming data, data generation) → data require rapid processing and analysis to maximise volume)  - high veracity (uncertainty data - reliability) Which tools can be used by organizations in order to manage data? - data basis (repositories of structured data) - big data analytics ARTIFICIAL INTELLIGENCE In 1955 some scientists such as AI. JJ. McCarthy, M. L Minky, N. Rochester and C.E Shannon made a proposal for the Dartmouth summer research project on AI. → It is defined as the science of enabling information technologies to simulate human intelligence. In 1969 Herbert Simon and Allen Newell studied how machines could simulate processes and outputs typical of human intelligence through studies in different fields , such as artificial intelligence and cognitive psychology. * In the Fifties he hypothesized that in the following decade there would have been machines able to play chess. Machine learning It was born in 1959 thanks to Arthur Samuel. → It is defined as the field of study that gives computers the ability to learn without being explicitly programmed. The machine’s ability to keep improving its performance without humans having to explain exactly how to accomplish all the tasks it’s given. It represents a fundamentally different approach to creating software: the machine learns from examples, rather than being explicitly programmed for a particular outcome. For most of the past 50 years, advances in information technology and its applications have focused on modifying existing knowledge and procedures and embedding them in machines. Functions of AI - Image and voice recognition are some of the outputs obtained with AI (voice recognition like Siri (Apple), Google Now, Cortana (Microsoft), Echo & Alexa (Amazon), Bixby). - problem solving and predictive analysis (anti-spam filters, fraud detection, recommendation systems like Amazon or Netflix) Ai is incredibly important and its potential is high. However, nowadays it is overhyped. It has generated a lot of unrealistic expectations. Limits of AI Artificial narrow intelligence (they perform one activity, but they can apply their knowledge to other contexts) Catastrophic forgetting No awareness It needs a huge number of examples  No human abilities such as commonsense reasoning, understanding the nuances of languages. AI is not endowed with will. It is not able to pose questions LESSON 10: DIGITAL MARKETING AND ADVERTISING MARKETING VS ADVERTISING Marketing = all the activities needed in the company to decide which type of product or service to offer. Marketing is a process that involves design, creation, research and data mining about how to best align the idea of a product or service with the target audience. ex. research Advertising= (final phase of marketing strategy) promotion of the product or service to the market Advertising is the literal process of making a product and service known to an audience. It is the description used to present the product, idea or service to the world. DIGITAL MARKETING/ADVERTISING Digital marketing is a component of marketing that utilizes internet and online based digital technologies. Digital marketing is a broad term that includes all marketing channels and methods you can use to design, research and promote products or services on the Internet but also on electronic devices to a specific audience. ex. surveys ex. digital advertising → ads Advertising is the one with the most important role, because it is in strict contact with the audience. DIGITAL MARKETING MEDIA TYPES owned media → directly owned by a brand, they are used to know better the target audience and to promote the products and service (ex. website, social media pages ecc) earned media → they are an effect of the so called word of mouth: it’s not managed directly by the brand but it is an effect of what it published on the media (ex. shares, likes, mentions, tweets, reposts ecc) paid media → they are available to companies to run and promote a product and services in a paid way (pay per click, Display Ads, paid influencers, audio ads, sponsor link on google, email ads) HISTORY Everything started in 1994: for the first time a banner appeared on the internet. Before that time there were no ads on the internet and campaigns were only running their ads only on traditionals channels. In 1994 AT&T decided to put some advertising online. They produced a banner that could bring users to their own page that was sponsoring detailed tools of art museums. They put the banner on a website that had many visitors at that time. After 1994, a lot happened. The world of digital is completely different. Nowadays 60% of the digital advertising spanning goes on digital. DIGITAL ADVERTISING The world of digital advertising is made of 2 components: advertisers and publishers. - An advertiser is someone who wants to make visible its products and service, does not have visibility but has money needed to promote them. - A publisher is someone who has a lot of visibility but is not making money from that traffic (ex Youtube, Trip advisor, Influencers). It offers something for free. market → advertisers and publishers meet in order to exchange money per visibility Between these 2 figures we have seen the growth of a lot of intermediaries. Nowadays advertisers and publisher can no longer have a direct interaction for different reasons: First, there are millions of advertisers and publishers so it is difficult to meet with one that could fit your target audience, that is why they need ad networks or media agencies (agencies that provide advertisers all the products and services before going to a publisher). They use the tactic of retargeting → digital advertising technique that enables the advertisers to propose the same specific product or service of the user There are different types of digital advertising: - display advertising → it can be sold by any digital property - search advertising → it can be sold only by search engines (like google) - social media advertising → it can only be sold by social media like ig, tw, fb ecc They differ because of the targeting (capability of reaching the audience). Nowadays, you could potentially reach any type of audience with all of them. → In display advertising there is not much crateria of reaching a specific audience. It uses content based targeting. → social media advertising uses a behavioral targeting. → search advertising uses contextual or key-based targeting (what someone is searching at a specific time) Search advertising sem → marketing activity I can perform on search engine (paying) seo → pay nothing (owned marketing)  DIGITAL MARKETING TRADITIONAL MARKETING broad audience limited audience targeted or client specific marketing global marketing versatile (can make changes in the non-versatile (cannot be altered once advertising) published) immediate communication delayed communication pay for performance (you pay only when it is a form of investment (you pay before that performance happens, you pay for the the performance happens; you invest in it, targeting performance) you pay for what has more potential) Digital marketing costs more because the audience is more targeted. It is related to the quality of the audience, not the quantity). CPM = Cost Per Mile (Thousand) → preferring publish model for advertisers because they don't have to do anything, they just create the page, put the banner and make money every time someone sees it. Advertisers don’t like this kind of publishing model because you are not even sure that someone has seen that ad. Just like direct marketing, many digital advertising units are bought on a per-thousand basis. In digital marketing, an advertiser is usually charged per 1,000 impressions. CPC = Cost Per Click → it was invented by Google (everything on Google is CPC) → they are showing the advertisers but without paying, but everytime someone is clicking they are going to pay something. It is the preferred one for advertisers. CPC is a pricing model where the advertiser is charged every time their ad is clicked by an individual. Advertisers running search engine ads, display ads, and social media ads typically have the option to be charged through this method. More sophisticated kinds of pay for performance publishing models: CPL = Cost Per Lead → the cost for advertisers per conversion of a user into a lead from their ad. Cost-per-Lead is when a platform charges an advertiser solely for the amount of individuals they send their way who sign up to receive more information. CPA = Cost Per Action → the cost for advertisers when their ad clock leads to a desired aCost-per-Action is when digital advertisers are charged for specified actions including likes, shares, click-throughs, requests for information, or anything else specific to the channel they are advertising onction (email submission, sale etc) CPI = Cost Per Install → the cost for advertisers per each install is generated from their ad  CPV = Cost-Per-View → Advertisers running Digital video ads are charged on a cost-per-view basis which, as you can probably guess, is a fee for every time someone watches any portion of their ad. There is a less common, but related metric, Cost-per-Completed-View (CPCV), in which an advertiser is only charged when the ad is seen in its entirety. CPI = Cost Per Install / CPD= Cost Per Download → For those marketers promoting a mobile application, they have the option to be charged on a per-install or per-download basis. CTR = Click-throughput rate → It is the ratio of users who click on a specific link to the number of total users who view a page, email, or advertisement. It is commonly used to measure the success of an online advertising campaign for a particular website as well as the effectiveness of email campaigns. Click-through rates for ad campaigns vary tremendously. The very first online display ad shown for AT&T on the website HotWired in 1994, had a 44% click-through rate. With time, the overall rate of user's clicks on web page banner ads has decreased Conversion Rate (CR) → the percentage of users who take a desired action. The archetypical example of conversion rate is the percentage of website visitors who buy something on the site. LESSON 11: INFORMATION SECURITY AND ETHICS CORE CONCEPT Full security doesn’t exist. There is nothing that we do in our everyday lives that we can consider secure. Naturally we know that there is a risk, but we are able to assess it. Risk assessment is made of 3 steps: 1. we perceive the risk 2. we know which type of risk it is 3. we try to mitigate it This risk assessment process can be more difficult in case the risk happens online, because we don’t really know the risk. COOKIES Cookies can be a risk too, but are not as dangerous as others. Cookies are pieces of text that any website can rise and set in our devices. Data is saved on our computer when we accept cookies. In order to remember that a user has put his information on the websites, the cookie saves them on the computer: the data corresponds to general technical information, passwords, pins ecc.. There are different types of cookie: - first party cookies → basic ones - third party cookies → the website tracks my navigation and they are set by subject that are pieces inside the website we are visiting (they are more risky) INFORMATION SYSTEMS SECURITY PROCESS Information system security is an ongoing process where the main steps are: 1. assess the risk 2. develop a security strategy 3. implement controls 4. monitor security 5. review and update security process Assessing IS risk There are different options for addressing a risk: - reduce the risk (ex. by actively installing countermeasures) - accept the risk ( ex. by accepting any losses that occurs) - transfer the risk (ex. by having someone else absorb the risk → insurance, outsourcing) - avoid the risk (ex. by using alternative means, avoiding risky tasks) Threats to IS security Securing against these threats must consider these goals: → Availability (ex. ensuring that legitimate users can access the system) → Integrity (ex. preventing unauthorized manipulations of data and systems) → Confidentiality (ex. protecting data from unauthorized access) → Accountability (ex. ensuring that actions can be traced) WHAT IS A COMPUTER CRIME? = using a computer to commit an illegal act It could like: Targeting a computer while committing an offense – unauthorized access of a server to destroy data Using a computer to commit an offense – using a computer to embezzle funds Using computers to support criminal activity – maintaining books for illegal gambling on a computer Who Commits Computer Crimes? Computer criminals come in all shapes and sizes, in order of infractions they are: 1. Current or former employees (most organizations report insider abuses as their most common crime) 2. People with technical knowledge (who commit business or information sabotage for personal gain) 3. Career criminals (who use computers to assist in crimes) 4. Outside crackers (commit millions of intrusions per year) → Studies show that only 10% of cracker attacks cause damage What is Hacking/Cracking? → Computer hacking refers to manipulating the normal behavior of a computer and its connected systems. This is usually done using scripts or programs that manipulate the data passing through a network connection in order to access information from the system. Difference between hacking and cracking Hackers → anyone who can gain unauthorized access to computers. - They are called white hat hackers and don’t intend to do harm Crackers → individuals who break into computer systems with the intent to commit crime or do damage - They are called malicious hackers or black hat hackers and intend to do harm - There are also hacktivists: crackers who are motivated by political or ideological goals and who use cracking to promote their interests How Do They Do It? Technology - vulnerability scanners - packet sniffers - keyloggers - brute force - Exploiting human weaknesses - phishing - social engineering The core technologies used by hackers are based on the so-called malware (malicious + software). It is made of a lot of different types of software: - virus - worms (lighter type of virus, it is combined with something that is already on my computer, they are spread on the computer) - trojan horses (the attack the user) - spyware - ransomware DENIAL-OF-SERVICE ATTACKS People that can collaborate in an attack on a very big application with me without knowing. Statically, at least one time in our lives we have been part of an attack. Another crime that be committed is Phishing → Phishing is a fraudulent attempt, usually made through email, to steal your personal information such as username, password and credit card details (and sometimes, indirectly, money), often for malicious reasons through an electronic communication (such as Email). How to avoid phishing attack Don’t click on links, download files or open attachments in emails from unknown senders. Never email personal or financial information, even if you are close the recipient. Check your online accounts and bank statements regularly. Do not divulge personal information over the phone unless you initiate the call. Verify any person who contacts (phone or email) you CRYPTOGRAPHY A risk that is always related to our everyday life is to transfer information online. Cryptography is a method of protecting information and communications through the use of codes, so that only those for whom the information is intended can read and process it. In computer science, cryptography refers to secure information and communication techniques derived from mathematical concepts and a set of rule-based calculations called algorithms, to transform messages in ways that are hard to decipher. → The prefix "crypt-" means "hidden" or "vault," and the suffix "-graphy" stands for "writing’’. There are 2 types of cryptography: 1. symmetric 2. asymmetric (or doubled creep encryption) CYBERHARASSMENT, CYBERSTALKING, CYBERBULLYING Cyberharassment – Use of a computer to communicate obscene, vulgar, or threatening content that causes a reasonable person to endure distress Cyberstalking – Tracking an individual, performing harassing acts not otherwise covered by Cyberharassment, or inciting others to perform harassing acts Cyberbullying – Deliberately causing emotional distress → All three are closely related, a cyberstalker may be committing Cyber Harassment and cyberbullying CYBERSQUATTING Cybersquatting – Buying and holding a domain name with the intent to sell it later for a big profit. The 1999 Anti-Cybersquatting Consumer Protection Act makes it a crime if the intent is to profit from the goodwill of a trademark belonging to someone else.