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Bitt I 2008 Lec1
Bitt I 2008 Lec1
Bitt I 2008 Lec1
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Bitt I 2008 Lec1


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Lecture 1, BITT1 2008

Lecture 1, BITT1 2008

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  • 1.
    • from Management Information System
    • by
    • James A. O'Brien and George M. Marakas
    • McGraw-Hill
  • 2. What is a System?
    • A set of interrelated components
    • With a clearly defined boundary
    • Working together
    • To achieve a common set of objectives
  • 3. What is an Information System?
    • An organized combination of…
      • People
      • Hardware and software
      • Communication networks
      • Data resources
      • Policies and procedures
    • This system…
      • Stores, retrieves, transforms, and disseminates information in an organization
  • 4. Information Technologies
    • Information Systems
      • All the components and resources necessary to deliver information and functions to the organization
      • Could be paper based
    • Information Technologies
      • Hardware, software, networking, data management
    • Our focus will be on computer-based information systems (CBIS)
  • 5. Fundamental Roles of IS in Business
  • 6. Types of Information Systems
    • Operations Support Systems
      • Efficiently process business transactions
      • Control industrial processes
      • Support communication and collaboration
      • Update corporate databases
    • Management Support Systems
      • Provide information as reports and displays
      • Give direct computer support to managers during decision-making
  • 7. Purposes of Information Systems
  • 8. Operations Support Systems
    • What do they do?
      • Efficiently process business transactions
      • Control industrial processes
      • Support communications and collaboration
      • Update corporate databases
  • 9. Types of Operations Support Systems
    • Transaction Processing Systems
      • Record and process business transactions
      • Examples: sales processing, inventory systems, accounting systems
    • Process Control Systems
      • Monitor and control physical processes
      • Example: using sensors to monitor chemical processes in a petroleum refinery
    • Enterprise Collaboration Systems
      • Enhance team and workgroup communication
      • Examples: email, video conferencing
  • 10. Two Ways to Process Transactions
    • Batch Processing
      • Accumulate transactions over time and process periodically
      • Example: a bank processes all checks received in a batch at night
    • Online Processing
      • Process transactions immediately
      • Example: a bank processes an ATM withdrawal immediately
  • 11. Management Support Systems
    • What do they do?
      • Provide information and support for effective decision making by managers
        • Management information systems
        • Decision support systems
        • Executive information systems
  • 12. Types of Management Support Systems
    • Management Information Systems (MIS)
      • Reports and displays
      • Example: daily sales analysis reports
    • Decision Support Systems (DSS)
      • Interactive and ad hoc support
      • Example: a what-if analysis to determine where to spend advertising dollars
    • Executive Information Systems (EIS)
      • Critical information for executives and managers
      • Example: easy access to actions of competitors
  • 13. Other Information Systems
    • Strategic Information Systems
      • Help get a strategic advantage over customer
      • Examples: shipment tracking, e-commerce Web systems
    • Functional Business Systems
      • Focus on operational and managerial applications of basic business functions
      • Examples: accounting, finance, or marketing
  • 14. Developing IS Solutions
  • 15. Data Versus Information
    • Data are raw facts about physical phenomena or business transactions
    • Information is data that has been converted into meaningful and useful context for end users
    • Examples:
      • Sales data is names, quantities, and dollar amounts
      • Sales information is amount of sales by product type, sales territory, or salesperson
  • 16. IS Activities
    • Input of data resources
      • Data entry activities
    • Processing of data into information
      • Calculations, comparisons, sorting, and so on
    • Output of information products
      • Messages, reports, forms, graphic images
    • Storage of data resources
      • Data elements and databases
    • Control of system performance
      • Monitoring and evaluating feedback
  • 17.
    • To succeed, a business must develop strategies to counter these forces…
      • Rivalry of competitors within its industry
      • New entrants into an industry and its markets
      • Substitute products that may capture market share
      • Bargaining power of customers
      • Bargaining power of suppliers
    Competitive Forces
  • 18. Competitive Forces and Strategies
  • 19.
    • Cost Leadership
      • Become low-cost producers
      • Help suppliers or customers reduce costs
      • Increase cost to competitors
        • Example: Priceline uses online seller bidding so the buyer sets the price
    • Differentiation Strategy
      • Differentiate a firm’s products from its competitors’
      • Focus on a particular segment or niche of market
        • Example: Moen uses online customer design
    Five Competitive Strategies
  • 20.
    • Innovation Strategy
      • Unique products, services, or markets
      • Radical changes to business processes
        • Example: Amazon’s online, full-service customer systems
    • Growth Strategy
      • Expand company’s capacity to produce
      • Expand into global markets
      • Diversify into new products or services
        • Example: Wal-Mart’s merchandise ordering via global satellite tracking
    Competitive Strategies (continued)
  • 21.
    • Alliance Strategy
      • Establish linkages and alliances with customers, suppliers, competitors, consultants, and other companies
      • Includes mergers, acquisitions, joint ventures, virtual companies
        • Example: Wal-Mart uses automatic inventory replenishment by supplier
    Competitive Strategies (continued)
  • 22.
    • These strategies are not mutually exclusive
      • Organizations use one, some, or all
      • A given activity could fall into one or more categories of competitive strategy
    • Not everything innovative serves to differentiate one organization from another
      • Likewise, not everything that differentiates organizations is necessarily innovative
    Using Competitive Strategies
  • 23.
    • Lock in Customers and Suppliers
      • Deter them from switching to competitors
    • Build in Switching Costs
      • Make customers and suppliers dependent on the use of innovative IS
    • Erect Barriers to Entry
      • Discourage or delay other companies from entering the market
      • Increase the technology or investment needed to enter
    Other Competitive Strategies
  • 24.
    • Build Strategic IT Capabilities
      • Take advantage of strategic opportunities when they arise
      • Improve efficiency of business practices
    • Leverage Investment in IT
      • Develop products and service that would not be possible without a strong IT capability
    Other Competitive Strategies
  • 25.
    • Called BRP or simply Reengineering
      • Fundamental rethinking and radical redesign of business processes
      • Seeks to achieve improvements in cost, quality, speed, and service
    • Potential payback is high, but so is risk of disruption and failure
    • Organizational redesign approaches are an important enabler of reengineering
      • Includes use of IT, process teams, case managers
    Reengineering Business Processes
  • 26. BPR Versus Business Improvement
  • 27.
    • IT plays a major role in reengineering most business processes
      • Can substantially increase process efficiencies
      • Improves communication
      • Facilitates collaboration
    The Role of Information Technology
  • 28.
    • Many processes are reengineered with…
      • Enterprise resource planning software
      • Web-enabled electronic business and commerce systems
    A Cross-Functional Process
  • 29.
    • IT that supports this process…
      • CRM systems using intranets and the Internet
      • Supplier-managed inventory systems using the Internet and extranets
      • Cross-functional ERP software to integrate manufacturing, distribution, finance, and human resource processes
      • Customer-accessible e-commerce websites for order entry, status checking, payment, and service
      • Customer, product, and order status databases accessed via intranets and extranets
    Reengineering Order Management
  • 30.
    • Agility is the ability to prosper
      • In rapidly changing, continually fragmenting global markets
      • By selling high-quality, high-performance, customer-configured products and services
      • By using Internet technologies
    • An agile company profits in spite of
      • Broad product ranges
      • Short model lifetimes
      • Individualized products
      • Arbitrary lot sizes
    Becoming an Agile Company
  • 31. How IT Helps a Company be Agile
  • 32. Network Concepts
    • A network is an interconnected or interrelated chain, group, or system
    • The number of possible connections on a network is N ( N – 1) or N 2 – N
      • N = number of nodes (points of connection)
      • Example: 10 computers on a network = 10(10 –1) = 10x9 = 90 possible connections
  • 33. Internet Networking Technologies
    • Internet networking technologies are being used as technology platform
      • Web browser suites
      • HTML Web page editors
      • Network management software
      • Firewalls
    • Being applied in Internet, intranet, and extranet applications
    • Reinforces previous move toward client/server networks based on open-systems architecture
  • 34. Middleware
    • Middleware
      • A general term for any programming that mediates between two separate programs
      • Allows a particular database to access other databases without custom programming
    • Commonly known as the “plumbing” of an information system
      • It routes data and information between back-end data sources and end user applications
      • An essential component of any IT infrastructure
  • 35. The Internet Revolution
    • The Internet has become a global information superhighway
      • Millions of smaller, private networks operating independent of, or in harmony with, each other
      • 10 servers in 1991 to over 46 million today
      • Sustained growth in excess of 1 million servers per month
      • No central computer system
      • No governing body
      • Based on common standards
  • 36. Business Use of the Internet
  • 37. The Role of Intranets
    • Many companies have sophisticated and widespread intranets, offering…
      • Detailed data retrieval
      • Collaboration
      • Personalized customer profiles
      • Links to the Internet
    • Intranets use Internet technologies
      • Web browsers and servers
      • TCP/IP network protocols
      • HTML publishing and databases
  • 38. Intranets
    • Intranets are protected by…
      • Passwords
      • Encryption
      • Firewalls
    • Customers, suppliers, and other business partners can access an intranet via extranet links
  • 39. Business Value of Intranets
    • Intranets support
      • Communications and collaboration
      • Business operations and management
      • Web publishing
      • Intranet portal management
  • 40. Intranets as Information Portals
  • 41. Extranets
    • Network links that use Internet technologies to connect the intranet of a business to the intranets of another
    • Virtual Private Networks
      • Direct private network links, or private secure Internet links between companies
    • Unsecured Extranet
      • Link between a company and others via the Internet, relying on encryption of sensitive data and firewall security systems
  • 42. Extranet Connectivity
  • 43. Business Value of Extranets
    • Web browser technology makes customer and supplier access to intranets easier and faster
    • Another way to build and strengthen strategic relationships
    • Enables and improves collaboration between a business, customers, and partners
    • Facilitates online, interactive product development and marketing
  • 44. Types of Communications Networks
    • Primary types of communications networks
      • Wide Area
      • Local Area
      • Virtual Private
      • Client/Server
      • Peer-to-peer
  • 45. Wide Area Network (WAN)
    • Telecommunication network that covers a large geographic area
  • 46. Local Area Network (LAN)
    • Connects computers within a limited physical area, such as an office, classroom, or building
  • 47. Virtual Private Networks (VPN)
    • Used to establish secure intranets and extranets
      • The Internet is the main backbone network
      • Relies on network firewalls, encryption, and other security features to build a “pipe” through the Internet
      • Creates a private network without the high cost of a separate proprietary connection
  • 48. Virtual Private Network
  • 49.
    • A virtual company uses IT to link…
      • People
      • Organizations
      • Assets
      • Ideas
    • Inter-enterprise information systems link…
      • Customers
      • Suppliers
      • Subcontractors
      • Competitors
    Creating a Virtual Company
  • 50. A Virtual Company
  • 51.
    • Basic business strategies
      • Share information and risk with alliance partners
      • Link complimentary core competencies
      • Reduce concept-to-cash time through sharing
      • Increase facilities and market coverage
      • Gain access to new markets and share market or customer loyalty
      • Migrate from selling products to selling solutions
    Virtual Company Strategies
  • 52. Logical Data Elements
  • 53. Logical Data Elements
    • Character
      • A single alphabetic, numeric, or other symbol
    • Field or data item
      • Represents an attribute (characteristic or quality) of some entity (object, person, place, event)
        • Examples: salary, job title
    • Record
      • Grouping of all the fields used to describe the attributes of an entity
        • Example: payroll record with name, SSN, pay rate
  • 54. Logical Data Elements
    • File or table
      • A group of related records
    • Database
      • An integrated collection of logically related data elements
  • 55. Electric Utility Database
  • 56. Database Structures
    • Common database structures…
      • Hierarchical
      • Network
      • Relational
      • Object-oriented
      • Multi-dimensional
  • 57. Hierarchical Structure
      • Early DBMS structure
      • Records arranged in tree-like structure
      • Relationships are one-to-many
  • 58. Network Structure
      • Used in some mainframe DBMS packages
      • Many-to-many relationships
  • 59. Relational Structure
    • Most widely used structure
      • Data elements are stored in tables
      • Row represents a record; column is a field
      • Can relate data in one file with data in another, if both files share a common data element
  • 60. Relational Operations
    • Select
      • Create a subset of records that meet a stated criterion
        • Example: employees earning more than $30,000
    • Join
      • Combine two or more tables temporarily
      • Looks like one big table
    • Project
      • Create a subset of columns in a table
  • 61. Multidimensional Structure
    • Variation of relational model
      • Uses multidimensional structures to organize data
      • Data elements are viewed as being in cubes
      • Popular for analytical databases that support Online Analytical Processing (OLAP)
  • 62. Multidimensional Model
  • 63. Object-Oriented Structure
    • An object consists of
      • Data values describing the attributes of an entity
      • Operations that can be performed on the data
    • Encapsulation
      • Combine data and operations
    • Inheritance
      • New objects can be created by replicating some or all of the characteristics of parent objects
  • 64. Object-Oriented Structure Source: Adapted from Ivar Jacobsen, Maria Ericsson, and Ageneta Jacobsen, The Object Advantage: Business Process Reengineering with Object Technology (New York: ACM Press, 1995), p. 65. Copyright @ 1995, Association for Computing Machinery. By permission.
  • 65. Object-Oriented Structure
    • Used in object-oriented database management systems (OODBMS)
    • Supports complex data types more efficiently than relational databases
      • Examples: graphic images, video clips, web pages
  • 66. Evaluation of Database Structures
    • Hierarchical
      • Works for structured, routine transactions
      • Can’t handle many-to-many relationship
    • Network
      • More flexible than hierarchical
      • Unable to handle ad hoc requests
    • Relational
      • Easily responds to ad hoc requests
      • Easier to work with and maintain
      • Not as efficient/quick as hierarchical or network
  • 67. Database Development
    • Database Administrator (DBA)
      • In charge of enterprise database development
      • Improves the integrity and security of organizational databases
      • Uses Data Definition Language (DDL) to develop and specify data contents, relationships, and structure
      • Stores these specifications in a data dictionary or a metadata repository
  • 68. Data Dictionary
    • A data dictionary
      • Contains data about data (metadata)
      • Relies on specialized software component to manage a database of data definitions
    • It contains information on..
      • The names and descriptions of all types of data records and their interrelationships
      • Requirements for end users’ access and use of application programs
      • Database maintenance
      • Security
  • 69. Entity Relationship Diagram