Introduction to Information Systems

Data Vs Information

• Data – Raw facts, No meaningful value• Information

– Data that has been put into a meaningful and useful context.

– Surprise value– aggregated, manipulated, and organized.

• Example: Single Railway Track is Data & Information is Rail track Network

Quality of InformationDetermined by how it motivates human action &

contributes to effective decision making:1. Utility of Information

• Form• Time• Place• Possession

2. Information Satisfaction3. Error & Bias

Information Systems: Turn Data into Information

• Raw material• Unformatted information or data• Generally has no context

Examples

• Processed material• Formatted information• Data given context

Individual time cards for factory workers entered into the payroll system

Department Labor Report, Project Status Report, Employee Payroll Checks

What Is an Information System?• An information system

– Set of interrelated components – That collect or retrieve, process, store, and

distribute information – To support decision making and control in an

organization.– To provide a feedback mechanism to meet an

objective– Used to analyze problems, visualize complex

subjects, and create new products

Components of an Information System

The Role of Information Systems in Business

• The increased use of cell phones and wireless telecommunications devices

• A massive shift toward online news and information, booming e-commerce and Internet advertising.

• Most of the firm's significant business relationships with customers, suppliers, and employees are digitally enabled and mediated.

• Key corporate assets (intellectual property, core competencies, and financial and human assets) are managed through digital means

The Role of Information Systems in Business

• Business responses to changes in their environment are enhanced through digital communications, allowing for time shifting (business being conducted 24x7) & space shifting (business being conducted globally or beyond traditional geographic boundaries).– Example 1: Most retail stores use IS to help them record

customer purchases, keep track of inventory, pay employees, buy new merchandise, and evaluate sales trends.

– Example 2: Decisions about what lines of merchandise need to be added or discontinued, or about what kind of investment they require, are typically made after an analysis provided by IS

– Example 3: Store management might make a decision to install touch-screen kiosks in all of their stores, with links to their e-commerce website for online shopping.

Benefits of Automation – Loan Example

Three Primary Uses of Information Systems

AutomationProviding support to complete a task faster, more cheaply, and perhaps with greater accuracy and/or consistency

AutomationProviding support to complete a task faster, more cheaply, and perhaps with greater accuracy and/or consistency

Organizational Learning (Informing)Providing support to improve day-today operations by creating, acquiring, and transferring knowledge

Organizational Learning (Informing)Providing support to improve day-today operations by creating, acquiring, and transferring knowledge

Achieving StrategyProviding support in a way that enables the firm to gain or sustain competitive advantage over rivals

Achieving StrategyProviding support in a way that enables the firm to gain or sustain competitive advantage over rivals

Levels of the Organization

Who, What, Why: Operational Level

Who, What, Why: Managerial Level

Who, What, Why: Executive Level

Types Of IS

1. Operations Support Systems

• Focus on the operations of the enterprise• Objective is to improve the operational efficiency• Use internal data primarily• For lower level of management• Classified into the following categories

a)Transaction Processing Systemb)Process Control Systemc) Enterprise Collaboration System

a) Transaction Processing Systems

Focus on the recording and processing of economic events (transactions)

Example: Payroll System (TPS)

b) Processing Control Systems

• Monitor and control industrial processes• Examples: Petroleum Refining, Power

generation etc

c) Enterprise Collaboration System• Enhance team and workgroup communication and productivity,

and include applications that are sometimes called office automation system.

• It facilitates the following activities:– Producing outgoing documents (using text processors,

software as word processing and desktop publishing & hardware as printers)

– storage & retrieval of documents (using document management system)

– transmission of messages (using message communication systems, e-mail, voice mail, videoconferencing and groupware)

– scheduling and meeting management (using video conferencing, electronic calendars with resource management)

2. Management Support Systems

• Information System application focus on providing information and support for effective decision making by managers.

• Classified into following categoriesa) Management Information Systemb) Decision Support Systemc) Executive Support System