Introduction to Management
Information systems pervade almost every aspect of our lives.
Whether we are withdrawing money from bank’s automatic
teller machine or surfing the world wide web, hardly a day
goes by without our feeding data into, or using information
generated by, an information systems. In business especially,
computer-based information systems generate most of the
information we use. These systems have become essential to
successful business operations.
After studying this topic, students should be able to:
3. Distinguish data from information and describe the characteristics used
to evaluate the quality of data.
4. Identify the basic types of business information systems and discuss
who uses them, how they are used, and what kinds of benefits they
5. Identify the major steps of the systems development process and state
the goal of each.
6. Define the term competitive advantage and discuss how organizations
are using information systems to gain such an advantage
2. Introduction To Information Systems
2.1 Information Concepts
2.2 A Business Perspective on Information
2.3 Characteristics of valuable information
6. Systems Performance and Standards
7. Systems and Modeling Concepts
4.1 Types of Model
5. Manual vs Computerized IS
10. Computer Based Information Systems
6.1 Components of a CBIS
12. Positive and Negative Impact of IS
What IS a system?
• A group of interrelated or interacting elements forming a unified
• A group of interrelated components working together toward a
common goal by accepting inputs and producing outputs in an
organized transformation process (dynamic system).
• Three basic interacting components:
– Processing (transformation process)
• Information: Data that have been shaped into a form
that is meaningful and useful to human beings.
• Data: Streams of raw facts representing events
occuring in organizations on the physical environment
before they have been organized and arranged into a
form that people can understand and use.
• Computer based information systems (CBIs):
Information systems that rely on computer hardware
and software for processing and disseminating
• a resource: Like money, people, raw materials, machinery
or time, information can serve as a resource, an input to
the production of outputs.
• an asset: Information can serve as an asset, which is the
property of a person or an organization that contributes
to a company’s output.
• a commodity: Companies can also sell information,
making it a commodity.
Information Systems Concepts (Continued)
• Foundation Concepts
– Fundamental concepts about the components
and roles of information systems.
• Information Technologies
– Major concepts, developments, and
management issues in information technology.
Information Systems Concepts (Continued)
• Business Applications
– The major uses of information systems for operations,
management, and competitive advantage.
• Development Processes
– How business professionals and information specialists plan,
develop, and implement information systems.
• Management Challenges
– The challenge of managing ethically and effectively.
Add Feedback and Control Loops..
• And the system, now called a cybernetic
system, becomes even more useful.
Other System Characteristics
• A system exists and functions in an environment containing
• Subsystem – a component of a larger system.
• Systems that share the same environment may be
connected to one another through a shared boundary, or
• Open versus closed system.
• Adaptive system
The Process of Transforming Data
A Business Perspective on Information Systems
• Information systems literacy: Broad-based understanding
of information systems that includes behavioral
knowledge about organizations and individuals using
information systems and technical knowledge about
• Computer literacy: Knowledge about information
technology, focusing on understanding how computer-
based technologies work
System & Modeling Concepts
• System : a set of elements or components
that interact to accomplish goals
• Systems components :
• Model : an abstraction or an approximation
that is used to represent reality.
• Types of model :
– Narrative - Physical
– Schematic - Mathematical
Types of Model
• Narrative model
– A logical & not a physical model
– Verbal & written descriptions
– Reports, document & conversations
• Physical Model
– A tangible representation of reality
– Computer designed & constructed
• Schematic Model
– Graph representation of reality
– Graphs, charts, figures, diagrams, illustration
– Used in developing computer programs &
• Mathematical Model
– Arithmetic representation of reality
– Solving mathematical models
Manual vs Computerized IS
• Manual Systems
– Does not guarantee can improve system performance
– Not efficient
• Computerized IS :
– Can improved system performance
– Computer based information systems
– People & procedures can perform a task efficiently
Computer-Based Information Systems
Consists of hardware, software, databases,
telecommunications, people and procedures
that are configured to collect , manipulate,
store and process data into information.
Components of a CBIS
• Hardware - computer equipment used to perform input,
processing, and output activities.
• Software - computer programs that govern the operation of
• Database - an organized collection of facts and information,
typically consisting of two or more related data files.
• People - the most important element in most computer-
based information systems.
• Procedures - include the strategies, policies, methods, and
rules for using the CBIS.
What Capabilities Do Business Expect from Using an
– Provide Fast and Accurate Transaction Processing: Companies make thousands of
transactions a day. A transaction can be a sale, cost of an item or service, a bank
– Provide Large Capacity, Fast Access Storage: Information systems (IS) need to be able
to have enough access to store corporate data and retrieve it at a quick rate.
– Provide Fast Communications (machine to machine, human to human): Companies
must be able to have enough infrastructure available that employee’s can communicate
by data, voice, to customers and other associates.
What Capabilities Do Business Expect from Using an IS???
– Reduce Information Overload: “The amount of information available on the Internet
doubles approximately every 100 days.” (p.17) Companies can use structure systems to
make sure that executives only get the information they need.
– Provide a Competitive Weapon: Companies can link their supply chains with manufacturers
as Wal-Mart has done. Manufacturers are able to serve the retailers better and the retailers
can avoid out of stocks and get rid of items that are not selling that fast.
– Provide Support for Decision Making: With IS systems in place employees have information
that can help them better allocate resources and make decisions.
How Information Systems
Support a Business
Support business process
• Most retail stores now use CBIS to help them record customer purchases, keep track of
inventory, pay employees, buy new merchandise and evaluate sales trends.
Support decision making
• IS help store managers and other business professionals make better decisions and
also supports buyers and others to gain an advantage over other retailers in the
competition for customers.
Support competitive advantage
• Gaining a strategic advantage over competition requires innovative application of
information technologies. Eq: store management might make decision to install touch-
screen kiosks in all stores with links to their e-commerce website for online shopping.
This might attract new customers and build customer loyalty.
A diagram of how 3 fundamental roles of IS
support a business
Positive and Negative Impacts of
Benefits of Information Systems
• can perform calculations or process paperwork much faster than people.
• can help companies learn more about the purchase patterns and preferences of
• provide new efficiencies through services such as ATMs, telephone systems, or
computer-controlled airplanes and air terminals.
• have made possible new medical advances in surgery, radiology, and patient
• distributes information instantly to millions of people accross the world.
Positive and Negative Impacts of
Negative Impacts of Information Systems
• by automating activities that were previously performed by people, information
systems may eliminate jobs.
• may allow organizations to collect personal details about people that violate their
• are used in so many aspects of everyday life that system outages can cause
shutdowns of businesses or transportation services, paralyzing communities.
• heavy users of information systems may suffer repetitive stress injury,
technostress, and other health problems.
• the Internet can be used to distribute illegal copies of software, books, articles,
and other intellectual property.
• Data - raw facts
• Information - data transformed into a meaningful
• Systems development - creating or modifying
existing business systems
• Organization - a formal collection of people and
various other resources established to accomplish a
set of goals
Answer to section discussion and problem solving
3. What is an information system? What are some of the ways
information systems are changing our lives?
4. How would you distinguish data and information? Information and
5. What are the most common types of computer based information
systems used in business organizations today? Give an example of each.
6. What are some of the benefits organizations seek to achieve through
using information systems?