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introduction to Information systems
Information Systems
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Chapter 1: An Introduction to Information Systems
Chapter 1 focuses on the value of information and how it helps decision-makers achieve organizational goals. Information is derived from data through the use of information systems, making it possible for organizations to improve the way they conduct business. Understanding the potential impact of information systems and having the ability to put this knowledge to work can result in successful personal careers, organizations that reach goals, and a higher quality of life. System users, business managers, and information system professionals must work together to build a successful information system. Many types of information systems are used in business organizations. The most common of these are transaction processing systems (TPS), enterprise resource planning systems (ERP), management information systems (MIS), decision support systems (DSS), and group support systems (GSS). In addition, some organizations also use specialized information systems such as knowledge management systems (KMS), systems based on artificial intelligence (AI), and systems based on virtual reality.
What is a system? - A system is a set of elements or components that interact to accomplish goals - Systems have inputs, processing mechanisms, outputs, and feedback - A system processes the input to create the output - Examples of systems are everywhere – an automatic car wash, the heating in a building, the human body; you should be able to think of many more What is information? - Information is a collection of facts - It can take many forms – text, numbers, images, audio clips and video clips are all examples - A closely related term is data - These two terms are often used interchangeably - an information system (IS) is a set of interrelated components that collect (input), manipulate & store (process), and disseminate (output) information, and provide a feedback mechanism to meet an objective - In information systems, input is the activity of gathering and capturing data - Processing means converting or transforming this input into useful outputs - Output involves producing useful information, usually in the form of documents and reports - Feedback is information from the system that is used to make changes to input or processing activities - An information system can be manual, for example paper-based, or computerized
Computer-based information systems
A computer-based information system (CBIS) is a single set of hardware, software, databases, telecommunications, people, and procedures that are configured to collect, manipulate, store, and process data into information. The essential components in a CBIS are:
Hardware Hardware consists of computer equipment used to perform input, processing and output activities.
Software Software consists of the computer programs that govern the operation of the computer.
Databases A database is an organized collection of facts and information, typically consisting of two or more related data files. A more precise definition and description is given in Chapter 5.
Telecommunications & Networks Telecommunication is the electronic transmission of signals for communications, which enables organizations to carry out their processes and tasks through computer networks. Networks connect computers and equipment in a building, around the country, or around the world to enable electronic communication.
People The people involved include users of the system and information systems personnel, including all the people who manage, run, program, and maintain the system.
Procedures Procedures include the strategies, policies, methods, and rules for using the CBIS, including the operation, maintenance, and security of the computer. Business Information Systems
Businesses utilize information systems to improve their operations at all levels. Nearly all workers, from top management to production line employees, come in contact with computerized systems on a daily basis. This results in a variety of systems functioning in different areas.
Electronic and Mobile Commerce
E-commerce involves any business transaction executed electronically between companies (business- to-business, B2B), companies and consumers (business-to-consumer, B2C), consumers and other consumers (consumer-to-consumer, C2C), business and the public sector, and consumers and the public sector.
Mobile commerce (m-commerce) refers to business transactions that are carried out using wireless communication devices.
Enterprise Systems: Transaction Processing Systems and Enterprise Resource Planning
Another family of business information systems is the transaction processing system (TPS). TPS are used to manage and facilitate common business transactions such as sales to customers and payments to employees and suppliers. Related to the TPS is an enterprise resource planning (ERP) system. This is a set of integrated programs that is capable of managing a company’s vital business operations for an entire multi-site, global organization. Although the scope of an ERP system may vary from company to company, most provide integrated software to support the manufacturing and finance business functions of an organization.
Information and Decision Support Systems
The information collected using a TPS can be transformed into routine information for managers and decision makers through the use of a management information system (MIS). These systems are designed to provide a variety of reports. Decision support systems (DSS) use the data collected by a TPS to support problem-specific decision-making. A DSS operates from a managerial perspective and
knowledge of information systems and other professional study. Increasingly, courses or entire degrees are being offered over the Internet.
Computer literacy is knowledge of computer systems and equipment and the ways they function. It stresses equipment and devices (hardware), programs and instructions (software), databases, and telecommunications. Information systems literacy goes beyond knowledge of the fundamentals of computer systems and equipment. Information systems literacy is knowledge of how data and information are used by individuals, groups, and organizations. Information Systems in the Functional Areas of Business
Information systems are used in all functional areas and operating divisions of business. For example, in finance and accounting, information systems are used to forecast revenues and business activity, determine the best sources and uses of funds, manage cash and other financial resources, analyse investments, and perform audits to make sure the organization is financially sound and all financial reports and documents are accurate. In sales and marketing, they are used to develop new goods and services (product analysis), determine the best location for production and distribution facilities (place or site analysis), determine the best advertising and sales approaches (promotion analysis), and set product prices to get the highest total revenues (price analysis).
Information Systems in Industry
Information systems are used in almost every industry or field. For example, the airline industry employs Internet auction sites to offer discount fares and increase revenue. Investment firms use information systems to analyse stocks, bonds, options, the futures market, and other financial instruments, as well as to provide improved services to their customers. Banks use information systems to help make sound loans and good investments. The transportation industry uses information systems to schedule trucks and trains to deliver goods and services at the lowest cost.
Global Challenges in Information Systems
The use of information systems has led to greater globalization, which refers to an increase in international trade and cultural exchange. Globalization has created many new opportunities for businesses, organizations, and individuals. However, globalization also means that organizations and individuals must deal with some new challenges, such as:
- Cultural challenges • Language challenges • Time and distance challenges • Infrastructure challenges • Currency challenges • Product and service challenges • Technology transfer issues • State, regional, and national laws • Trade agreements
introduction to Information systems
Course: Information Systems
University: Richfield Graduate Institute of Technology
