Types of Information Systems
Computer-based information systems (CBIS) use computer technology to perform some or all of their tasks and are composed of:
Hardware is a device such as a processor, monitor, keyboard or printer.
Software is a program or collection of programs that enable hardware to process data.
Database is a collection of related files or tables containing data.
Network is a connecting system (wireline or wireless) that permits different computers to share resources.
Procedures are the set of instructions about how to combine the above components in order to process information and generate the desired output.
People are those individuals who use the hardware and software, interface with it, or uses its output.
Information Systems Inside Your Organization
Capabilities of Information Systems
n Perform high-speed, high-volume numerical computations
n Provide fast, accurate communication and collaboration within and among organizations
n Store huge amounts of information in small space
n Allow quick, inexpensive access to vast amounts of information worldwide
n Interpret vast amounts of data quickly and efficiently
n Increase effectiveness and efficiency of people working in groups in one place or around the world
n Automate semiautomatic business process and manual tasks
An application program is a computer program designed to support a specific task, a business process or another application program.
Breadth of Support of Information Systems
Functional area information systems support particular functional areas in an organization.
Enterprise resource planning systems tightly integrate the functional area information systems via a common database.
Transaction processing systems support the monitoring, collection, storage, and processing of data from the organization’s basic business transactions.
Interorganizational information systems connect two or more organizations. Examples are supply chain management systems and electronic commerce systems.
Information Systems Support for Organization Employees
Office automation systems typically support the clerical staff, lower and middle managers,
and knowledge workers. These people use OASs to development documents, schedule
resources, and communicate.
Functional area information systems summarize data and prepare reports, primarily for
middle managers.
Business intelligence systems provide computer-based support for complex, non-routine
systems, primarily for middle managers and knowledge workers.
Expert systems attempt to duplicate the work of human experts by applying reasoning
capabilities, knowledge, and expertise within a specific domain.
Dashboards support all managers by providing rapid access to timely information and
direct access to structured information in the form of reports.
Porter’s Competitive Forces Model
n Threat of entry of new competitors is high when it is easy to enter a market and low when significant barriers to entry exist.
n A barrier to entry is a product or service feature that customers expect from organizations in a certain industry.
n For most organizations, the Internet increases the threat that new competitors will enter a market.
n The bargaining power of suppliers is high when buyers have few choices and low when buyers have many choices.
n Internet impact is mixed. Buyers can find alternative suppliers and compare prices more easily, reducing power of suppliers.
n On the other hand, as companies use the Internet to integrate their supply chains, suppliers can lock in customers.
n The bargaining power of buyers is high when buyers have many choices and low when buyers have few choices.
n Internet increases buyers’ access to information, increasing buyer power.
Internet reduces switching costs, which are the costs, in money and time, to buy elsewhere. This also increases buyer power
Porter’s Value Chain Model
This model identifies specific activities where organizations can use competitive strategies for greatest impact.
Primary activities are those business activities that relate to the production and distribution of the firm’s products and services, thus creating value for which customers are willing to pay. Primary activities include inbound logistics, operations, outbound logistics, marketing and sales, and customer service.
Support activities do not add value directly to a firm’s products and services, but support the primary activities. Support activities include accounting, finance, management, human resources management, product and technology development (R&D), and procurement.
2.3 Why are Information Systems Important to Organizations & Society
n IT will reduce the number of middle managers.
n IT will change the manager’s job.
n IT impacts employees at work.
n IT provides quality-of-life improvements.
Traditional Major IS Functions
n Managing systemr devdlopment and sistems projectManaging com0uter opdrations
n Staffing, training, devAl/pinc IS skiLls
n Providi.g technical services
n Infrastructure planning, development, control
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