Chapter 1 (Lecture 3) Management Information Systems PDF

Chapter 1 INFORMATION SYSTEMS IN GLOBAL BUSINESS TODAY Retrieved from: http://www.slideshare.net/NorazilaMat1/laudon-mis12-ppt01-16595885 Adapted by: Dr. Karim Mezghani Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY Learning Objectives Understanding the effects of in...

Chapter 1 INFORMATION SYSTEMS IN GLOBAL BUSINESS TODAY Retrieved from: http://www.slideshare.net/NorazilaMat1/laudon-mis12-ppt01-16595885 Adapted by: Dr. Karim Mezghani Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY Learning Objectives Understanding the effects of information systems on business and their relationship to globalization. Explain why information systems are so essential in business today. Describe the different academic disciplines used to study information systems. Explain what is meant by a sociotechnical systems perspective. 2 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today How information systems are transforming business – Increase in wireless technology use, Web sites – Increased business use of Web 2.0 technologies – Cloud computing, mobile digital platform allow more distributed work, decision-making, and collaboration Globalization opportunities – Internet has drastically reduced costs of operating on global scale – Presents both challenges and opportunities 3 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today Information Technology Capital Investment FIGURE 1-1 Information technology capital investment, defined as hardware, software, and communications equipment, grew from 32 percent to 52 percent of all invested capital between 1980 and 2011. The returns on the IT investment are greater 4 Management Information Systems 5 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today Globalization challenges and opportunities – Internet and global communications had greatly reduced the economic and cultural advantages of developed countries. – The challenge for business is to avoid markets for goods and services that can be produced offshore much less expensively. – The emergence of the Internet into a full-blown international communications system has drastically reduced the costs of operating and transacting on a global scale. Briefly, information systems enable globalization. 6 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today In the emerging, fully 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 – Business to be conducted at any time (time shifting) and any place (space shifting) Digital firms are ideally suited for global operations which take place in remote locations and very different time zones 7 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today Growing interdependence between ability to use information technology and ability to implement corporate strategies and achieve corporate goals Business firms invest heavily in information systems to achieve six strategic business objectives: 1. 2. 3. 4. 5. 6. 8 Operational excellence New products, services, and business models Customer and supplier intimacy Improved decision making Competitive advantage Survival Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today Operational excellence: – Improvement of efficiency to attain higher profitability – Information systems, technology an important tool in achieving greater efficiency and productivity – Walmart’s RetailLink system links suppliers to stores for superior replenishment system 9 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today New products, services, and business models: – Business model: describes how company produces, delivers, and sells product or service to create wealth – Information systems and technology a major enabling tool for new products, services, business models Examples: Apple’s iPod, iTunes, iPhone, iPad, Google’s Android OS, and Netflix 10 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today Customer and supplier intimacy: – Serving customers well leads to customers returning, which raises revenues and profits Example: High-end hotels that use computers to track customer preferences and use to monitor and customize environment – Intimacy with suppliers allows them to provide vital inputs, which lowers costs Example: J.C.Penney’s information system which links sales records to contract manufacturer 11 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today Improved decision making – Without accurate information: Managers must use forecasts, best guesses, luck Leads to: – Overproduction, underproduction of goods and services – Misallocation of resources – Poor response times Poor outcomes raise costs, lose customers – Example: Verizon’s Web-based digital dashboard to provide managers with real-time data on customer complaints, network performance, line outages, etc. 12 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today Operational excellence: – Improvement of efficiency to attain higher profitability New products, services, and business models: – Enabled by technology Customer and supplier intimacy: – Serving customers raises revenues and profits – Better communication with suppliers lowers costs Improved decision making – More accurate data leads to better decisions 13 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today Competitive advantage – Delivering better performance – Charging less for superior products – Responding to customers and suppliers in real time – Examples: Apple, Walmart, UPS 14 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today Survival – Information technologies as necessity of business – May be: Industry-level changes, e.g. Citibank’s introduction of ATMs Governmental regulations requiring recordkeeping – Examples: Toxic Substances Control Act, SarbanesOxley Act 15 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY The Role of Information Systems in Business Today The Interdependence Between Organizations and Information Technology Figure 1.2 16 In contemporary systems there is a growing interdependence between a firm’s information systems and its business capabilities. Changes in strategy, rules, and business processes increasingly require changes in hardware, software, databases, and telecommunications. Often, what the organization would like to do depends on what its systems will permit it to do. Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY Contemporary Approaches to Information Systems Contemporary Approaches to Information Systems The study of information systems deals with issues and insights contributed from technical and behavioral disciplines. Figure 1.9 17 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY Contemporary Approaches to Information Systems Technical approach – Emphasizes mathematically based models – Computer science, management science, operations research Behavioral approach – Behavioral issues (strategic business integration, implementation, etc.) – Psychology, economics, sociology 18 Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY Contemporary Approaches to Information Systems Management Information Systems – Combines computer science, management science, operations research and practical orientation with behavioral issues Four main actors – – – – 19 Suppliers of hardware and software Business firms Managers and employees Firm’s environment (legal, social, cultural context) Management Information Systems CHAPTER 1: INFORMATION IN BUSINESS SYSTEMS TODAY Contemporary Approaches to Information Systems Approach of this course: Sociotechnical view Optimal organizational performance achieved by jointly optimizing both social and technical systems used in production Helps avoid purely technological approach 20