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An understanding of the effective and responsible use and management of information systems is
important for managers and other business knowledge workers in todays global information
society. Information systems and technologies have become a vital component of successful
businesses and organizations. Information systems constitute an essential field of study in
business administration and management, as they are considered a major functional area in
business operations.
1-2
Managerial end users need to know how information systems can be employed successfully in a
business environment. The important question for any business end user or manager is: What do
you need to know in order to help manage the hardware, software, data, and network resources
of your business, so they are used for the strategic success of your company?
A Framework for Business End Users: [Figure 1.2]
Managers or business end users are not required to know the complex technologies, abstract
behavioural concepts, or the specialized applications involved in the field of information systems.
Figure 1.2 illustrates a useful conceptual framework that outlines what a manager or business end
user needs to know about information systems. It emphasizes five areas of knowledge:
1. Foundation concepts of IS
2. Technology of IS
3. Applications of IS
4. Development of IS
5. Management of IS
Foundation Concepts of IS - Fundamental behavioural and technical concepts that will help
[Chapter 1 & 2]
you understand how information systems can support the business
operations, managerial decision making, and strategic advantage of
business firms and other organizations.
Technology of IS
- Major concepts, developments, and management issues in
[Chapter 4 - 7]
information technology (hardware, software, networks, database
management, and other information processing technologies).
Applications of IS
The major uses of information systems for the operations,
[Chapter 8-12]
management, and competitive advantage of an enterprise,
including electronic commerce and collaboration using the
Internet, intranets, and extranets.
Development of IS
[Chapter 3]
Management of IS
The challenges of effectively and ethically managing the resources
[Chapter 13-15]
and business strategies involved in using information technology at
the end user, enterprise, and global levels of a business.
Information System Resources and Technologies: [Figure 1.3]
An information system (IS) is an organized combination of people, hardware, software,
communications networks, and data resources that collects, transforms, and disseminates
information in an organization.
Types of IS
IS Specialists
Managerial-End-User
An Enterprise Perspective:
Information systems play a vital role in the success of a business success of an enterprise. For
example, the Internet and Internet-like internal networks, or intranets, and external
interorganizational networks, called extranets, can provide the information infrastructure a
business needs for:
1. Efficient operations
2. Effective management
3. Competitive advantage
The success of an information systems should not be measured only by its efficiency in terms of
minimizing costs, time, and the use of information resources. Success should also be measured by
the effectiveness of the information technology in supporting an organizations
1. Business strategies
2. Enabling its business processes
3. Enhancing its organizational structures and culture
4. Increasing the business value of the enterprise in a dynamic business environment.
For managerial end users, the information systems function represents:
1. A major functional area of business that is important to a businesses success
2. An important factor affecting operational efficiency, employee productivity and morale, and
customer service and satisfaction.
3. A major source of information and support needed to promote effective decision making by
managers.
4. An important ingredient in developing competitive products and services that give an
organization a strategic advantage in the marketplace.
5. A major part of the resources of an organization and its cost of doing business
6. A vital, dynamic, and challenging career opportunity for many men and women.
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We are living in an emerging global information society, with a global economy that is
increasingly dependent on the creation, management, and distribution of information resources
over interconnected global networks like the Internet. So information is a basic resource in
todays society.
Agricultural Society
Industrial Society
workers.
Knowledge Workers
The Real World example of NFO Research and TalkCity emphasized the successful use of
information technology to transform business processes and gain competitive advantages.
However, it is important that you realize that information technology and information systems can
be mismanaged and misapplied so that they create both technological and business failure.
Top Five Reasons for Success
User involvement
Proper planning
Realistic expectations
Technological incompetence
Information systems perform three vital roles in any type of organization. That is, they support an
organizations:
1. Business operations
2. Managerial decision making
3. Strategic competitive advantage
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The rapid pace of change in todays business environment has made information systems and
information technology vital components that help keep an enterprise on target to meets its
business goals. Information technology has become an indispensable ingredient in several
strategic thrusts that businesses have initiated to meet the challenge of change. These include:
1. Internetworking of computing
2. Internetworking of the enterprise
3. Globalization
4. Business process reengineering
5. Using information for competitive advantage
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In network computing:
1. Network computers provide a browser-based user interface for processing small application
programs called applets.
2. Network computers are microcomputers without floppy or hard disk drives that are designed
as low-cost networked computing devices.
3. Servers provide the operating system, applets, databases, and database management software
needed by the end users in the network.
Common trends in network computing:
1. Downsizing of larger computer systems by replacing them with client/server networks
2. Client/server network of several interconnected local area networks (LANs) of
microcomputers and servers may replace a large mainframe-based network with many end
user terminals. This typically involves a complex and costly effort to install new application
software that replaces the software of older, traditional mainframe-based business information
systems, now called legacy systems.
3. Client/server networks are seen as more economical and flexible than legacy systems in
meeting end user, workgroup and business unit needs, and more scalable in adjusting to a
diverse range of computing workloads.
4. One of the attractions of corporate intranets is that their Internet-like technology makes them
more scalable, as well as easier and cheaper to develop and use than either traditional
client/server or mainframe-based legacy systems.
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The Internet is changing the way businesses are operated and people work, and how information
technology supports business operations and end user work activities.
Internetworked Enterprises:
The Internet and Internet-like networks - inside the enterprise (intranets), between an enterprise
and its trading partners (extranets), and other networks - have become the primary information
technology infrastructure that supports the business operations of many organizations. This is
especially evident in the areas of electronic commerce systems among businesses and their
customers and suppliers, and electronic collaboration systems among business teams and
workgroups.
Electronic Commerce:
Is the buying and selling, and marketing and servicing of products, services, and information over
a variety of computer networks. An internetworked enterprise uses the Internet, intranets,
extranets, and other networks to support every step of the commercial process.
Enterprise Collaboration Systems:
Involve the use of groupware tools to support communication, coordination, and collaboration
among the members of networked teams and workgroups. An internetworked enterprise depends
on intranets, the Internet, extranets, and other networks to implement such systems.
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Many companies are in the process of globalization; that is, becoming internetworked global
enterprises. For example, businesses are expanding into global markets for their products and
services, using global production facilities to manufacture or assemble products, raising money in
global capital markets, forming alliances with global partners, and battling with global competitors
for customers from all over the globe. Managing and accomplishing these strategic changes
would be impossible without the Internet, intranets, and other global computing and
telecommunications networks that are the central nervous system of today=s global companies.
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Using IT for globalization and business process reengineering frequently results in the
development of information systems that help give a company a competitive advantage in the
marketplace. These strategic information systems use IT to develop products, service, processes,
and capabilities that give a business a strategic advantage over the competitive forces it faces in its
industry. These forces include:
1. Firms competitors
2. Firms customers
3. Firms suppliers
Differentiation Strategy
Innovation Strategy