MIS, MANAGEMENT INFORMATION SYSTEM

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Lecture 2
Information Systems in the
Enterprise and
IT Infrastructure

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Four main actors: Suppliers of hardware and software (the technologists);
business firms making investments and seeking to obtain value from the
technology; managers and employees seeking to achieve business value
(and other goals); and the contemporary legal, social, and cultural context
(the firm’s environment).
Together these actors produce what we call management information systems
Management Information Systems 8/e
Chapter 1 Managing the Digital Firm
Socio-Technical Systems

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Optimize systems performance:
• Technology and organization
• Organizations mutually adjust to one another until fit
is satisfactory
Management Information Systems 8/e
Chapter 1 Managing the Digital Firm
Socio-Technical Systems

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Management Information Systems 8/e
Chapter 1 Managing the Digital Firm
SOURCE: Liker, et al, 1987
Figure 1-7
Socio-technical Systems
CONTEMPORARY APPROACHES TO INFORMATION SYSTEMS

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
Business Processes and Information Systems
Business processes:
• Manner in which work is organized, coordinated,
and focused to produce a valuable product or
service
• Concrete work flows of material, information, and
knowledge—sets of activities
• Unique ways to coordinate work, information, and
knowledge
• Ways in which management chooses to
coordinate work
INTEGRATING FUNCTIONS AND BUSINESS PROCESSES:
Introduction to Enterprise Applications

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
Examples of Business Processes
Manufacturing and production:
• Assembling product, checking quality, producing
bills of materials
Sales and marketing:
• Identifying customers, creating customer
awareness, selling
INTEGRATING FUNCTIONS AND BUSINESS PROCESSES:
Introduction to Enterprise Applications
Table 2.6

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
Finance & accounting:
• Paying creditors, creating financial statements,
managing cash accounts
Human resources:
• Hiring employees, evaluating performance,
enrolling employees in benefits plans
INTEGRATING FUNCTIONS AND BUSINESS PROCESSES:
Introduction to Enterprise Applications
Examples of Business Processes (Continued)
Table 2.6 continued

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
Business Processes and Information Systems
Cross-Functional Business Processes:
• Transcend boundary between sales, marketing,
manufacturing, and research and development
• Group employees from different functional
specialties to a complete piece of work
Example: Order Fulfillment Process
INTEGRATING FUNCTIONS AND BUSINESS PROCESSES:
Introduction to Enterprise Applications

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
The Order Fulfillment Process
Figure 2-12
INTEGRATING FUNCTIONS AND BUSINESS PROCESSES:
Introduction to Enterprise Applications

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
Business Processes and Information Systems
(Continued)
• Information systems help organizations
achieve great efficiencies by automating parts
of processes
• IS also contributes to completely rethinking
processes.
• Business processes typically span several
different functional areas.
INTEGRATING FUNCTIONS AND BUSINESS PROCESSES:
Introduction to Enterprise Applications

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Types of Information Systems
Figure 2-1

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Different Kinds of Systems
1. Operational-level systems: support operational managers,
keeping track of the elementary activities and
transactions
2. Management-level systems: serve the monitoring,
controlling, decision-making, and administrative activities
3. Strategic-level systems: help senior management tackle
and address strategic issues
Three main categories of information systems serve
different organizational levels:

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Types of Information Systems

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
The Four Major Types of Information Systems
Figure 2-2

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OSS
• Operations Support Systems- Is to process business
transactions, control industrial processes, support communications
and collaboration, update corporate databases efficiently
-- TPS- records business transaction
– Process Control Systems – monitor & control physical
processes. Water reservoir system, power generation system
– Enterprise Collaboration Systems- e-mail,chat & video
conferencing group

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Transaction Processing Systems (TPS)
• A computerized system that performs and records the daily
routine transactions necessary to the conduct of the
business such as
• Sales order entry, hotel reservations, payroll, employee
record keeping
• Answer routine question and track flow of transaction
• Provides status of internal operation
Batch – transaction data accumulate over time,
processed periodically.
Real-time – data processed immediately after a
transaction occurs.

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
A Symbolic Representation for a Payroll TPS
Figure 2-3

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Typical Applications of TPS
Figure 2-4

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Management Information Systems (MIS)
– pre-specified reports & displays to support decision-
making for mid level Managers
• Inputs: High volume transaction level data
• Processing: Simple models
• Outputs: Summary reports/current performance
• Users: Middle managers
Example: Annual Sales figure of a particular product category

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Management Information Systems (MIS) (continued)
Figure 2-5

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Management Information Systems (MIS) (continued)
Figure 2-6
A sample MIS report

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Decision-Support Systems (DSS)
Non routine decision making for middle management
• Inputs: Output from TPS and MIS
• Processing: Interactive
• Outputs: Decision analysis
• Users: Mid-level Managers
Example: Double sales, what production? Voyage
estimating system

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Decision-Support Systems (DSS) (Continued)
Voyage-estimating decision-support system
Figure 2-7

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
EXECUTIVE SUPPORT SYSTEMS (ESS):
Addresses non-routine decisions requiring judgment,
evaluation and insight
• Inputs: Aggregate data (TPS,MIS,DSS)
• Processing: Interactive
• Outputs: Projections
• Users: Senior managers
Example: 5 year operating plan

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Model of a Typical Executive Support System
Figure 2-8

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
EXECUTIVE SUPPORT SYSTEMS (ESS) (Continued)
• Top Level Management
• Designed to the individual senior manager
• Ties CEO to all levels
• Very expensive to keep up
• Extensive support staff

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
Sales and Marketing Systems
SYSTEM DESCRIPTION ORGANIZATIONAL
LEVEL
Order
processing
Enter, process, and track orders Operational
Pricing analysis Determine prices for products and
services
Management
Sales trend
forecasting
Prepare 5-year sales forecasts Strategic
Table 2-2

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
SYSTEM DESCRIPTION ORGANIZATIONAL
LEVEL
Machine
control
Control the actions of machines and
equipment
Operational
Production
planning
Decide when and how many products
should be produced
Management
Facilities
location
Decide where to locate new production
facilities
Strategic
Manufacturing and Production Systems

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
Overview of an Inventory System
Figure 2-10
SYSTEMS FROM A FUNCTIONAL PERSPECTIVE

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
Financing & Accounting Systems (Continued)
SYSTEM DESCRIPTION ORGANIZATION-
AL LEVEL
Accounts
receivable
Tracks money owed the firm Operational
Budgeting Prepares short-term budgets Management
Profit
planning
Plans long-term profits Strategic
Table 2-4

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
Human Resource Systems (Continued)
SYSTEM DESCRIPTION ORGANIZATIONAL
LEVEL
Training and
development
Tracks employee training, skills,
and performance appraisals
Operational
Compensation
analysis
Monitors the range and distribution
of employee wages, salaries, and
benefits
Management
Human resources
planning
Plans the long-term labor force
needs of the organization
Strategic
Table 2-5

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
Human Resource Systems (Continued) An Employee Recordkeeping System
Figure 2-11
SYSTEMS FROM A FUNCTIONAL PERSPECTIVE

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Relationship of Systems to One Another
Interrelationships among systems
Figure 2-9

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Management Information Systems
Chapter 2 Information Systems in the Enterprise
MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Relationship of Systems to One Another
In contemporary digital firms, the different types of
systems are closely linked to one another. This is
the ideal. In traditional firms these systems tend to
be isolated from one another, and information does
not flow seamlessly from one end of the organization
to the other. Efficiency and business value tend to
suffer greatly in these traditional firms

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Management Information Systems
• IT infrastructure:
– Set of physical devices and software required to
operate enterprise
– Set of firmwide services including:
• Computing platforms providing computing services
• Telecommunications services
• Data management services
• Application software services
• Physical facilities management services
• IT management, standards, education, research and development
services
– “Service platform” perspective more accurate view
of value of investments
IT Infrastructure
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
• Evolution of IT infrastructure
– General-purpose mainframe & minicomputer era: 1959 to
present
• 1958 IBM first mainframes introduced
• 1965 Less expensive DEC minicomputers introduced
– Personal computer era: 1981 to present
• 1981 Introduction of IBM PC
• Proliferation in 80s, 90s resulted in growth of personal software
– Client/server era: 1983 to present
• Desktop clients networked to servers, with processing work split
between clients and servers
• Network may be two-tiered or multitiered (N-tiered)
• Various types of servers (network, application, Web)
IT Infrastructure
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Management Information Systems
IT Infrastructure
STAGES IN IT
INFRASTRUCTU
RE EVOLUTION
Illustrated here are the typical
computing configurations
characterizing each of the five
eras of IT infrastructure
evolution.
FIGURE 5-2
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Evolution of IT infrastructure (cont.)
– Enterprise computing era: 1992 to present
• Move toward integrating disparate networks,
applications using Internet standards and enterprise
applications
– Cloud Computing: 2000 to present
• Refers to a model of computing where firms and
individuals obtain computing power and software
applications over the Internet or other network
• Fastest growing form of computing
IT Infrastructure
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
IT Infrastructure
STAGES IN IT
INFRASTRUCTU
RE EVOLUTION
(cont.)
Illustrated here are the typical
computing configurations
characterizing each of the five
eras of IT infrastructure
evolution.
FIGURE 5-2
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
IT Infrastructure
A MULTITIERED CLIENT/SERVER NETWORK (N-TIER)
In a multitiered client/server network, client requests for service are handled by different levels of servers.
FIGURE 5-3
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• IT Infrastructure has 7 main components
1. Computer hardware platforms
2. Operating system platforms
3. Enterprise software applications
4. Data management and storage
5. Networking/telecommunications platforms
6. Internet platforms
7. Consulting system integration services
Infrastructure Components
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
IT Infrastructure
THE IT
INFRASTRUCTU
RE ECOSYSTEM
There are seven major
components that must be
coordinated to provide the firm
with a coherent IT
infrastructure. Listed here are
major technologies and
suppliers for each component.
FIGURE 5-9
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Computer hardware platforms
– Client machines
• Desktop PCs, mobile devices – PDAs, laptops
– Servers
• Blade servers: ultrathin computers stored in racks
– Mainframes:
• IBM mainframe equivalent to thousands of blade
servers
– Top chip producers: AMD, Intel, IBM
– Top firms: IBM, HP, Dell, Sun Microsystems
Infrastructure Components
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Operating system platforms
– Operating systems
• Server level: 75% run Windows; 25% run Unix or Linux
• Client level:
– 90% run Microsoft Windows (XP, 2000, CE, etc.)
– Handheld device OS’s (Android, iPhone OS)
– Cloud computing OS’s (Google’s Chrome OS)
• Enterprise software applications
– Enterprise application providers: SAP and Oracle
– Middleware providers: BEA
Infrastructure Components
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Data management and storage
– Database software:
•IBM (DB2), Oracle, Microsoft (SQL Server),
Sybase (Adaptive Server Enterprise), MySQL
– Physical data storage:
•EMC Corp (large-scale systems), Seagate,
Maxtor, Western Digital
– Storage area networks (SANs):
•Connect multiple storage devices on dedicated
network
Infrastructure Components
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Networking/telecommunications platforms
– Telecommunication services
•Telecommunications, cable, telephone
company charges for voice lines and Internet
access
•AT&T, Verizon
– Network operating systems:
•Windows Server, Novell, Linux, Unix
– Network hardware providers:
•Cisco, Alcatel-Lucent, Nortel, Juniper Networks
Infrastructure Components
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Internet platforms
– Hardware, software, management services to
support company Web sites, (including Web
hosting services) intranets, extranets
– Internet hardware server market: Dell,
HP/Compaq, IBM
– Web development tools/suites: Microsoft
(FrontPage, .NET) IBM (WebSphere) Sun (Java),
independent software developers: Adobe,
RealMedia
Infrastructure Components
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Consulting and system integration services
– Even large firms do not have resources for a full
range of support for new, complex infrastructure
– Software integration: ensuring new
infrastructure works with legacy systems
– Legacy systems: older TPS created for
mainframes that would be too costly to replace
or redesign
– Accenture, IBM Global Services, EDS, Infosys,
Wipro
Infrastructure Components
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• The emerging mobile digital platform
– Cell phones, smartphones (BlackBerry, iPhone)
•Have assumed data transmission, Web surfing,
e-mail and IM duties
– Netbooks:
•Small, low-cost lightweight notebooks
optimized for wireless communication and core
computing tasks
– Tablets (iPad)
– Networked e-readers (Kindle)
Contemporary Hardware Platform Trends
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Grid computing
– Connects geographically remote computers into a
single network to combine processing power and
create virtual supercomputer
– Provides cost savings, speed, agility
• Virtualization
– Allows single physical resource to act as multiple
resources (i.e., run multiple instances of OS)
– Reduces hardware and power expenditures
– Facilitates hardware centralization
Contemporary Hardware Platform Trends
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Cloud computing
– On-demand (utility) computing services obtained
over network
• Infrastructure as a service
• Platform as a service
• Software as a service
– Cloud can be public or private
– Allows companies to minimize IT investments
– Drawbacks: Concerns of security, reliability
Contemporary Hardware Platform Trends
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Green computing
– Practices and technologies for manufacturing, using,
disposing of computing and networking hardware
• Autonomic computing
– Industry-wide effort to develop systems that can
configure, heal themselves when broken, and protect
themselves from outside intruders
– Similar to self-updating antivirus software; Apple and
Microsoft both use automatic updates
• High performance, power-saving processors
– Multi-core processors
Contemporary Hardware Platform Trends
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Software outsourcing and cloud services
– Three external sources for software:
1. Software packages and enterprise software
2. Software outsourcing (domestic or offshore)
– Domestic:
» Primarily for middleware, integration services, software
support
– Offshore:
» Primarily for lower level maintenance, data entry, call
centers, although outsourcing for new-program
development is increasing
Contemporary Software Platform Trends
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Three external sources for software (cont.)
3. Cloud-based software services
• Software as a service (SaaS)
• Accessed with Web browser over Internet
• Ranges from free or low-cost services for individuals to
business and enterprise software
• Users pay on subscription or per-transaction
• E.g. Salesforce.com
• Service Level Agreements (SLAs): formal agreement
with service providers
Contemporary Software Platform Trends
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Making wise infrastructure investments
– Amount to spend on IT is complex question
• Rent vs. buy, outsourcing
– Total cost of ownership (TCO) model
• Analyzes direct and indirect costs
• Hardware, software account for only about 20% of TCO
• Other costs: Installation, training, support,
maintenance, infrastructure, downtime, space and
energy
• TCO can be reduced through use of cloud services,
greater centralization and standardization of hardware
and software resources
Management Issues
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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Management Information Systems
• Competitive forces model for IT
infrastructure investment
1. Market demand for firm’s services
2. Firm’s business strategy
3. Firm’s IT strategy, infrastructure, and cost
4. Information technology assessment
5. Competitor firm services
6. Competitor firm IT infrastructure investments
Management Issues
CHAPTER 5: IT INFRASTRUCTURE AND EMERGING
TECHNOLOGIES
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