CHAPTER 1

1. Basic Concepts of Management Information System

Information Systems are an integrated set of components for collecting, storing,
processing, and communicating information. Business firms, other organizations, and
individuals in contemporary society rely on information systems to manage their
operations, compete in the marketplace, supply services, and augment personal lives
Information System could be manual, computer-based, or hybrid systems. In this course
the term “information system” is used to refer to “computer- based information
systems”
A computer-based information system (CBIS) is an information system that uses
computer technology to perform some or all of its intended tasks CBIS typically
composed of the following six elements
▪ Hardware is a device such as a processor, monitor, keyboard or printer

▪ Software is a program or collection of programs that enable hardware to process data.

▪ Database is a collection of related files or tables containing data.

▪ Network is a connecting system (wire line or wireless) that permits different computers
to share resources.
▪ Procedures are the set of instructions about how to combine the above components in
order to process information and generate the desired output.
▪ People are that individual who use the hardware and software, interface with it, or uses
its output which is called end user. The other kind of people is It specialist (System
developer, Programmer, database, administer, Web page designer, network engineer
and security officer and etc.)
What makes information system so important in our day to day lives?

Because it facilitates
Capturing of data
Processing of data
Sharing of data
Storing data etc.
Generally, an understanding of the effective and responsible use and management of
information systems and technologies is important for managers, business
professionals, and other knowledge workers in today’s internetworked enterprises.
Information systems play a vital role in the e-business and e-commerce operations,
enterprise collaboration and management, and strategic success of businesses that must
operate in an internetworked global environment. Thus, the field of information systems
has become a major functional area of business administration.
We categorize information system based on different levels of system
Operational-level systems
support operational managers by monitoring the day-today’s elementary activities and
transactions of the organization e.g. TPS.
Knowledge-level systems support knowledge and data workers in designing products,
distributing information, and coping with paperwork in an organization.
e.g. Knowledge Worker System, Office Automation System
Management-level systems support the monitoring, controlling, decision-making, and
administrative activities of middle managers. e.g. MIS, DSS
Strategic-level systems support long-range planning activities of senior management.
e.g. ESS
Fig 1.1 Kinds of information system

1.2. Role of Information System

In any business firms Information systems perform the following three major roles
Business applications of IS support an organizations business processes and
operations, business decision-making, and strategic competitive advantage. Major
application categories of information systems include operations support systems, such
as transaction processing systems, process control systems, and enterprise collaboration
systems, and management support systems, such as management information systems
(MIS), decision support systems (DSS), and executive information systems (EIS).
Other major categories are expert systems, knowledge management systems and
strategic information systems
Fig.1.2 Role of information system

1.3. Trends in information System

Until 1960s the role of information system was simple transaction processing, record
keeping, accounting and other electronic data processing. But later on (starting from
1970s on ward different roles have been practicing)
Fig 1.3 will give you high lights about some of the trend that was practiced until 2000

1.4. Information system activities

One should know different activities which takes place during data or information
process namely (input of data resources, processing of data in to information, output of
information products, storage of data or information resources and control of system
performance).
1.4.1 Data about business transaction and other events must be captured and prepared
for processing by the input activities. Input typically takes the form of data entry activity
such as recording and editing. End users should record data about transaction on some
type of physical medium (paper form or enter it directly into a computer system.
Once entered data may be transferred onto a machine-readable medium such as a
magnetic disc until needed for processing.
1.4.2. Processing of data into information
Data is typically subjected to processing activities such as calculating, storing,
classifying, clustering and summarizing. These activities organize, analyze and
manipulate data thus converting them into information for end users.
The quality of any data stored in an information system must be maintained by a
continual process of correcting and updating activities.
1.4.3. Output information product
Information in various form is transmitted to end users and made available to them in
the output activity. The goal of information systems to production of appropriate
information products for end users. Common information products include message,
reports, forms and graphic images which may be provided by video display, audio
Reponses, paper products and multimedia.
1.4.4. Storage of data resources
Storage is a basic of system components of IS. Storage is the information system
activity in which data and information are retained in an organized manner for later
use, for example just as written text material is organized into words ,sentences
,paragraph and documents ,stored data is commonly organized into fields, records, files
and databases.(please define and get enough knowledge about each of them)
1.4.5. Control of system performance
An important information system activity is the control of its performance. An
information system should produce feedback about its input, processing, output storage
activities. This feedback must be monitored and evaluated to determine if the system is
meeting established performance standards. Then appropriate system activities must be
adjusted so that proper information products are produced for end users.

INFORMATION SYSTEM ACTIVITIES

Input. (optical scanning of bar-coded tags on merchandise)

Processing. (calculating employee pay, taxes, and other payroll deductions)

Output. (producing reports and displays about sales performance)

 Storage. (maintaining records on customers, employees, and products)

Control. (generating audible signals to indicate properness)

1.5. Globalization and information technology

Globalization means new market, largely for those who are economically well
developed. This is the fact. And information technology is one of the technologies
fostered to the new market in this increasingly competitive world. The widespread
access to, sharing of, and use of information(knowledge) in economic activities through
technology.
It is greatly facilitated by the “Internet” The communication, transmission and
distribution of information are no longer limited by space and time. Information is
accessed and transmitted in real time and at low marginal cost and Information flow
can be targeted to specific individuals and audiences. Ironically, we can say that IT
revolution is sweeping the globe (forcing the world to be narrow)

“Internet” time
Real time information transmission and retrieval. What used to take days and weeks of
research is now available with a few clicks of the “mouse”
Real time monitoring and communication: Capacity for real time response “Internet”
distance: Proximity and geographical location are no longer as important

1.6 Privacy Issues in ICT

What is privacy?
❖ Different scholars define the term privacy in various ways as follows
➢ The right of an individual to be secured from unauthorized disclosure of information
about oneself that is contained in documents or database
➢ Freedom from unauthorized intrusion.
➢ The ability of an individual to protect information about himself or herself
➢ The protection of the collection, storage and dissemination of personal information.
❖ Individuals have the right to privacy of data held about themselves and to be anonymous
in their interaction with others
❖ Privacy is important because
(a) Individuals can maintain their autonomy and individuality.
people define themselves by exercising power over information about themselves.
(b) It has a functional benefit like
Safeguarding safety and peace of mind. This is good for mental health & creativity
Development of interpersonal relationships and maintenance of democratic society, etc.
ICT & privacy
ICT is used to invade privacy.
This is because: -The development of ICT is causing exponential growth of personal
information collected and stored by the government and the private sector.
➢ Personal information is usually provided to the government, employers, insurers,
product advertisers, banks, schools, universities, etc.
➢ Private or personal information like income / any financial information, age, height,
weight, family members, marriage status, health information and genetic information a
result of the technology. The technology also made this personal information easily
accessible and exposed it to misuse.
❖ With the development of Internet:
➢ Unauthorized parties can easily monitor one’s activity.
➢ Personal information can easily be disclosed without the permission of the individual.
➢ More and more database can easily be accessed from the Internet.
➢ powerful search engine and information mining technologies enabled individuals and
institutions:
✓ To electronically cross-link databases containing personal information, and
✓ To compile extensive information about the person from diverse sources with a single
query
❖ Connecting your computer to the Internet opens the door for an attack from a huge
number of people on the Internet.
• Increased use of the Internet exposes individuals to face identity thieves of:-social
security number, address, date of birth, medical record, etc.
❖ In general ICT is a cause for increased invasion of privacy. It has a negative impact on:
✓ Personal autonomy
✓ People suffer from Humiliation
✓ Economic harm
✓ Discrimination
Companies are still making money by selling customer/ personal information
Factors that contribute to the Invasion of privacy
1. Online communication
"Online communications" are communications over:
✓ telephone,
✓ cable networks, or
✓ Wireless systems.
Public activities in cyberspace cause invasion of privacy. Examples of public activities:
a. Newsgroups. a message is available for anyone to view, copy, and store. In addition,
your name, electronic mail (e-mail) address, and information about your service
provider are usually available for inspection as part of the message itself.
b. Listservs. The message is sent to multiple recipients.
c. Subscriber directories. Most ISPs provide online member directories that publicly list
all subscribers to the service. Some of these directories may list additional personal
information.
d. Domain registration. Many individuals obtain their own website name, called domain
names, for example, www.XYZfamily.org. Domain registrations are public
information. Anyone can look up the owner of a domain name online by using a service
such as www.checkdomain.com or www.internic.net/whois.html
2. Technologies that record virtually all online activities
A. Cookies
Cookies are small text files that Web sites place in your computer to help your browsers
remember specific information. For example, they might store your passwords and user
IDs.
➢ Cookies are used so that a Website can "remember" you the next time you visit it and
present you with a customized page, such as one containing your name.
➢ The web site might also offer you products or ads tailored to your interests, based on
the contents of the cookie data.
➢ Most cookies are used only by the web site that placed it on your computer. But some,
called third-party cookies, communicate data about you to an advertising clearinghouse
which in turn shares that data with other online marketers
B. The data gathering and processing practices of commercial firms
✓ Electronic communication in trading.
✓ through credit card purchasing
✓ Online shopping or communication by mobile phone
✓ Details of these communications are recorded that allows collection of data at on
unprecedented level of detail.
✓ Detailed pictures of customers’ activities can be built using the current technology.
For example, as it is stated above: On the Internet: Files like Cookies, Web bugs, Spy
ware programs User’s e-mail address, details of website visited or online purchases can
be easily captured.
3. The Government's power to access personal information.
➢ Government is also becoming a potential threat to one's privacy.
➢ Government has many tools for extracting private information from the population and
many government employees have access to this valuable information.
➢ A corrupted government employee could easily misuse the information E.g. -
Unauthorized queries in to taxpayer databases, Employees of the social security
administration may sell confidential government records.

4. Supervisors full access to the employee's activity Due to the development of ICT
➢ The supervisor can easily monitor every movement and communication of the
employee and this information can be downloaded in to a record of his/her work habit.
➢ What is on the employee's screen and where he/she wonders on the Internet can also be
monitored.
➢ The aspects of the personal life of employees can be monitored while using Internet &
e-mail.
 1.6.2. Methods of protecting privacy in cyberspace
➢ Password
✓ Creating passwords with senseless combinations of upper- and lower-case letters,
numbers and symbols,
✓ Change your password often.
✓ take steps to secure your password.
➢ Privacy-enhancing technologies (PET)
a. Using encryption programs
➢ The privacy advantage of encryption is that anything encrypted is virtually inaccessible
to anyone other than the designated recipient.
➢ Thus, private information may be encrypted and then transmitted, stored, or distributed
without fear that it will be read by others.
➢ Strong encryption programs such as PGP (Pretty Good Privacy) are available online.
b. Anonymous remailers.
➢ Anonymous remailers are intermediaries that receive e-mail, strip off all identifying
information, then forward the mail to the appropriate address.
c. Anonymous surfing services.
➢ These ISP services mask your identity by acting as an agent to transfer data between an
Internet website and your browser.
d. Storage security and protection software.
➢ Software securities programs help prevent unauthorized access to files on your personal
computer.
➢ For example, one program encrypts every directory with a different password so only
the person who knows the password can open it.
➢ Privacy policy
➢ Most Internet Service Providers (ISP) has adopted privacy policies that they post on
their web sites.
➢ If you are not satisfied with the policy or if there is no policy, avoid using the site.
➢ Use only secure web sites when you transmit sensitive personal information over the
Internet.
➢ When you provide your credit card account number to a shopping site, for example, be
sure that the transmission is secure.
 Chapter Two
2. Leadership Issues in Information System
2.1 Top IS Job
Management Information Systems (MIS) is a broad term for the technological systems
businesses use to manage their daily operations. Students in this major study how
organizations of all kinds can use these systems and the data they generate to make
better decisions. This degree provides students with a range of transferrable skills,
including computer programming, web analytics, social media, and more. Below, there
the list of IS job and their aspect.
❖ Systems Administrator
Professionals in this role oversee the day-to-day operations of an organization's
computer and network systems. They install, monitor, and organize wide area networks
(WANs), local area networks (LANs), intranets, and other data communication
processes. Computer systems administrators help businesses run more smoothly and
effectively.
❖ Database Administrator
Database administrator is another common job for an MIS major. These skilled
professionals use specialized software to store, protect, and organize data. They oversee
all aspects of data administration, including database design, security, troubleshooting,
and more.
❖ Data Scientist
In this profession, they'll help businesses collect valuable customer data, then clean,
organize, store, and analyze it. By presenting their findings in clear, compelling ways,
they can help organizations of all kinds make more strategic, informed business
decisions.
❖ Software Engineer
Software engineers help create everything from computer games to network control
systems. They use their coding and programming skills to design, test, and improve
these software products. For someone with an inventive personality and a love of new
technology, a career in software can be fun, exciting, and intellectually challenging.
2.2 Strategic uses of IT/IS
Let’s look at several key strategies that can also be implemented with information
technology. They include locking in customers or suppliers, building switching costs,
raising barriers to entry, and leveraging investment in information technology.
-Locking in customers and Suppliers
Investments in information technology can allow a business to lock in customers and
suppliers (and lock out competitors) by building valuable new relationships with them.
These business relationships can become so valuable to customers or suppliers that they
deter them from abandoning(discard) a company for its competitors or intimidate them
into accepting less profitable business arrangements. Early attempts to use information
systems technology in these relationships focused on significantly improving the
quality of service to customers and suppliers in a firm’s distribution, marketing, sales,
and service activities.
-Create switching costs
A major emphasis in strategic information systems has been to find ways to create
switching costs in the relationships between a firm and its customers or suppliers. In
other words, investments in information systems technology, such as those mentioned
in the Boeing example, can make customers or suppliers dependent on the continued
use of innovative, mutually beneficial inter-enterprise information systems. They then
become reluctant to pay the costs in time, money, effort, and inconvenience that it
would take to switch to a company’s competitors.
-Raise barriers to entry
By making investments in information technology to improve its operations or promote
innovation, a firm could also raise barriers to entry that would discourage or delay other
companies from entering a market. Typically, these barriers increase the amount of
investment or the complexity of the technology required to compete in an industry or a
market segment. Such actions tend to discourage firms already in the industry and deter
external firms from entering the industry.
-Leverage investment in IT
Investing in information technology enables a firm to build strategic IT capabilities so
that they can take advantage of opportunities when they arise. In many cases, this
happens when a company invests in advanced computer-based information systems to
improve the efficiency of its own business processes. Then, armed with this strategic
technology platform, the firm can leverage investment in IT by developing new
products and services that would not be possible without a strong IT capability.
An important current example is the development of corporate intranets and extranets
by many companies, which enables them to leverage their previous investments in
Internet browsers, PCs, servers, and client/server networks.

Fig.2.2. Examples of how, over time, companies have used information technology to
implement five competitive strategies for strategic advantage.

Data, Information, and Information Systems

Information versus Data
It is important to distinguish between data and information. Data is a raw fact that can
take a form of number or statement such as a date and a measurement.
 A common definition of information is that it is a data that have been processed so that
they are meaningful. Information is anything that reduces uncertainly. Information is
the result of processing, manipulating and organizing data in a way that adds to the
knowledge of the receiver.
In other words, it is the context in which data is taken. Therefore, the greater the
reduction in uncertainly, the more information we have. The value information provides
to knowledge workers in an organization is also in reducing uncertainty. Information is
vital to decision making in many areas.
Characteristics Valuable Information
Although information is a useful resource for individuals and organizations, not all
information can be considered useful. The difference between ‘good’ and ‘bad’
information can be identified by considering whether or not it has some or all the
attributes of information quality. Valuable information should contain the
characteristics summarized as follows:
• Accessibility: information should be easily accessible by authorized users so they can
obtain it in the right format at the right time to meet their needs.
• Accuracy: accurate information is error free. In some cases, inaccurate information is
generated, because inaccurate data are fed into the information process. This is
commonly called Garbage in Garbage out (GIGO).
• Completeness: complete information contains all important facts. For example, an
investment report that does not include all the important costs is not complete.
• Economical: information should also be economical. Decision makers must always
balance the value of information with the cost of producing it.
• Flexibility: Flexible information can be used for variety of purposes. For example,
information on how much inventory is on hand for a particular part can be used by sales
representative in closing a sale, by a production manager to determine whether more
inventory is needed, and by financial executives to determine the total value the
company has invested in inventory.
• Relevance: relevant information is important to the decision maker. Information
showing that number prices might drop may not be relevant to computer chips
manufacturer
• Reliability: reliable information can be depended on. In many cases, the reliability of
information depends on the reliability of the data collection method and source of the
data. In other instances, reliability depends on the source of the information. A report
from unknown source that oil prices might go up might not be reliable.
• Security: Information should be secure form access by unauthorized users.
• Simplicity: Information should be simple, not overly(excessively) complex.
Sophisticated and detailed information might not be needed. In fact, too much
information can cause information overload, whereby a decision maker has too much
information and is unable to determine what is really important.
• Timeliness: Timely information is delivered when it is needed. Knowing last week’s
whether condition will not help when trying to decide what jacket to wear today.
• Verifiability: Information should be verifiable. This means that you can check it to
make sure it is correct, perhaps by checking many sources for the same information.

Definition of System and Information systems

System is a set of entities, real or abstract, comprising a whole where each component
interacts with or is related to at least one other component and they all serve a common
objective. Any object which has no relation with any other element of the system is not
part of that system but rather of the system environment. A subsystem then is a set of
elements, which is a system itself, and a part of the whole system. In general system
theory, an information system is a system, automated or manual, that comprises people,
machines, and/or methods organized to collect, process, transmit, and disseminate data
that represent user information.
Basic components of information systems are:
Group: A system must consist of more than one item.
Interacting: The components must operate in some relationship to each other.
Components: The components may be subsystems or may be elementary items,
incapable of (for our purposes) further subdivision.
Purpose: Purpose is the objective of a system. Knowing the purpose of a system helps
us understand it or redesign it to carry out this purpose better.
Boundary: Separates the components of a system, which are inside it, from the rest of
the world (its environment).
Environment: a system under which your system operates.
 Open system: Information cross the boundary of such systems inward, outward, or in
both directions.
Closed system: Nothing crosses the boundary of such systems in either direction.
Feedback: It is output from a system component that becomes, perhaps after
additional processing, input to a system component. It can be internal to a system or
external to it.
Closed loop systems: Systems that do not use feedback to adjust their outputs
Open loop systems: Systems that use feedback to adjust their outputs, based on how
well the result of those output matches the desired result.
Why Information systems Matter?
- Businesses and the environment in which it is conducted have changed dramatically
over time and will continue to evolve.

- These changes have brought new pressures as well as challenges for management of
information, information systems and technologies from which potential benefits can
be derived.

- Trends in business have created new roles for information and information systems,
creating opportunities but also complexities.
Thus, managing information systems and service have been giving a great emphasis
and have the following importance;
• Information systems are main sources of capital management; trends have showed
that investments in IT double as a percentage of total investments since 1980s. Now,
for instance, it accounts for 1/3 of the capital investment in USA.
• Information systems are foundations of doing business; this is because all business
currently depends on information technology to conduct their business activities, design
strategies, and to become competent and profitable.
Example: restaurants may use handheld devices to communicate menu orders during
busy hours and a rental car company may use information technology to track customer
orders and may use global positioning systems that relay the exact position of every car
wherever it is.
• Information systems increase productivity: Simply put managing organization’s
information systems and resources will increase productivity and effectiveness of a
company.
• Information systems create opportunities and advantages
Business and organizations simply cannot stick their head in the sand and ignore all of
the improvements and innovations that are available now days. Rather they should
improve current processes that are available and grasp the opportunities for new
products and services that the business can take the advantages with information
technology.
Definition of Information system
An information system consists of any organized combination of people, hardware,
software, communications networks, data resources, and policies and procedures that
stores, retrieves, transforms, and disseminates information in an organization.
People rely on modern information systems to communicate with one another using a
variety of physical devices (hardware) , information processing instructions and
procedures(software),communications channels (networks) , and stored data (data
resources) .
An information system is a set of inter related elements or components that collect
(input), manipulate (process), and disseminate (output) data and information, and
provides feedback mechanism to meet an objective.
- Input: refers to the act of gathering and capturing raw data. It could be a manual or
automated process. But regardless of the method used, the accuracy of the input is
critical in order to achieve the desired result.
- Processing: Involves the conversion or transformation of data into useful output.
- Output: is the production of useful information usually in the form of documents and
reports and
- Feedback: the term feedback is used to describe the output used to make changes to the
input or processing activities
Organization and the purpose of Information Systems
Definition of organization
Organization is a stable A, formal social structure that takes resources from the
environment and processes them to produce outputs.
 Purposes of Information Systems
Information systems have become s integrated into our daily business activities as
accounting, finance, operation management, marketing, human resource management
or any other major business functions. Information systems and technologies such as e-
business and e-commerce have become vital components for successful businesses and
organizations.
Information systems can help all kinds of organizations and business to improve the
effectiveness and efficiency of their business processes, management decision making
and work group collaboration, which strengthens their competitive position in rapidly
changing market places. Generally, Information systems provide an organization with
support:
Business processes and operations
- Business decision making and
- Strategies for competitive advantage

Support business processes and operations

As a consumer, you regularly encounter information systems that support the business
processes and operations at the many retail stores where you shop. For example, most
retail stores now use computer-based information systems to help their employees
record customer purchases, keep track of inventory, pay employees, buy new
merchandise, and evaluate sales trends. Store operations would grind to a halt without
the support of such information systems.
Support business decision making
Information systems also help store managers and other business professionals make
better decisions. For example, decisions about what lines of merchandise(products)
need to be added or discontinued and what kind of investments they require are typically
made after an analysis provided by computer-based information systems. This function
not only supports the decision making of store managers, buyers, and others, but also
helps them look for ways to gain an advantage over other retailers in the competition
for customers.
Support Strategies for competitive advantage
Gaining strategic advantage over competitors requires the innovative application of
information technologies. For example, store management might decide to install
 touch-screen kiosks in all stores, with links to the e-commerce Web site for online
shopping. This offering might attract new customers and build customer loyalty
because of the ease of shopping and buying merchandise provided by such information
systems. Thus, strategic information systems can help provide products and services
that give a business a comparative advantage over its competitors
Types of Information Systems
I. Operation Support Systems:

The role of a business firm’s operations support systems is to process business

transactions, control industrial processes, support enterprise communications and
collaborations, and update corporate databases efficiently.
support business operations. This category of information systems includes:
-Transaction processing systems (TPS)
TPS are information systems that deal with repetitive processing of common business
events and the recording of their associated data. A TPS collects and stores information
about transactions, and controls some aspects of transactions. E.g. bank transaction
processes, super markets checkouts (billing systems). A transaction is an event of
interest to the organization. e.g. a sale at a store. TPS focuses on data and can increase
transaction efficiency, customer services and reduces transaction costs.
Transaction processing systems are important examples of operations support systems
that record and process the data resulting from business transactions. They process
transactions in two basic ways. In batch processing , transactions data are accumulated
over a period of time and processed periodically. In real-time (or online ) processing,
data are processed immediately after a transaction occurs. For example, point-of-sale
(POS) systems at many retail stores use electronic cash register terminals to capture and
transmit sales data electronically over telecommunications links to regional computer
centers for immediate (real-time) or nightly (batch) processing.
Process control systems
Process control systems monitor and control physical processes. For example, a
petroleum refinery uses electronic sensors linked to computers to monitor chemical
processes continually and make instant (real-time) adjustments that control the refinery
process.
Enterprise collaboration systems (ECS)
Enterprise collaboration systems enhance team and workgroup communications and
productivity and include applications that are sometimes called office automation
systems.
For example, knowledge workers in a project team may use e-mail to send and receive
e-messages or use videoconferencing to hold electronic meetings to coordinate their
activities.
Generally, An Enterprise Collaboration System (ECS) is an information system used to
facilitate efficient sharing of documents and knowledge between teams and individuals
in an enterprise. ECS tools include the Internet, groupware, various forms of software
and hardware and internal and external networks.
Management Support Systems: when information system applications focus on
providing information and support for effective decision making by managers, they are
called management support systems. These systems providing information and support
for decision making by all types of managers and business professionals is a complex
task. Includes Management information systems (MIS), decision support systems
(DSS), and executive information systems (EIS).

Management Information systems: provide information in the form of reports and

displays to managers and many business professionals.
For example, sales managers may use their networked computers and Web browsers to
receive instantaneous displays about the sales results of their products and access their
corporate intranet for daily sales analysis reports that evaluate sales made by each
salesperson.
Decision Support Systems: DSS give direct computer support to managers during the
decision-making process. For example, an advertising manager may use a DSS to
perform a what-if analysis as part of the decision to determine how to spend advertising
dollars. A production manager may use a DSS to decide how much product to
manufacture, based on the expected sales associated with a future promotion and the
location and availability of the raw materials necessary to manufacture the product.
Executive information systems: EIS provide critical information from a wide variety
of internal and external sources in easy-to-use displays to executives and managers. For
example, top executives may use touch-screen terminals to view instantly text and
 graphics displays that highlight key areas of organizational and competitive
performance.
II. Other Types of Information Systems

Office Information systems or office automation systems: OIS is an information system

that uses hardware, software, and networks to enhance work flow and facilitate
communication among employees. Using office automation systems employees
perform tasks electronically using computers and other electronic devices, instead of
manually. With an OIS for example, a registrar might post the class schedule on the
internet and email students when the schedule is updated. In manual systems, the
registrar would photocopy the schedule and mail it to each student’s house.
Expert Systems
An expert system is an information system that captures and stores the knowledge of
human experts and then imitates human reasoning and decision-making processes for
those who have less expertise. Expert systems are composed of two main components.
These are a knowledge base and inference rules.
-A knowledge base: is a combined subject knowledge and experience of human experts
-Inference rules are set of logical judgments applied to the knowledge base each time
a user describes a situation to the expert system. Although expert systems can help
decision making at any level in an organization, non-management employees are the
primary users who utilize them to help with job related decisions.
Knowledge management system
Knowledge management is the process through which organizations generate value
from their intellectual and knowledge-based assets.

“Knowledge management is the explicit and systematic management of vital

knowledge and its associated processes of creating, gathering, organizing, diffusion,
use and exploitation. It requires turning personal knowledge into corporate knowledge
that can be widely shared throughout an organization and appropriately applied.”

Knowledge management systems help organization to extract, store and use

organizational knowledge for the success of the organization.
In general, there are two types of knowledge: tacit knowledge and explicit knowledge.
Tacit knowledge is that stored in the brain of a person. Explicit knowledge is that
 contained in documents or other forms of storage other than the human brain. Explicit
knowledge may therefore be stored or imbedded in facilities, products, processes,
services and systems. Both types of knowledge can be produced as a result of
interactions or innovations.
Strategic Information system
Refers to any kinds of information system that uses information technology to help an
organization gain competitive advantage, reduce competitive disadvantage or meet
other strategic corporate objectives of a firm.
Supply chain management system (SCM)
The term supply chain refers to the sequence of activities involved in producing and
selling a product or service. In industries that produce goods, the activities include
marketing, purchasing raw materials, manufacturing and assembly, packing and
shipping, billing, collection and after -the sale services. In services industries, the
sequence may include marketing, document management, and monitoring customer
profiles. An information system that supports these activities and is linked to become
one IS providing information to any stages of business processes is called Supply chain
management system.
Customer relationship management systems
Customer relationship management: CRM entails all aspects of interaction that a
company has with its customer, whether it is sales or service-related. It helps to manage
an organization’s relationships with customers. CRM system is often thought of as a
business strategy that enables businesses to:
▪ Understand the customer
▪ Retain customers through better customer experience
▪ Attract new customer
▪ Win new clients and contracts Increase profitably
▪ Decrease customer management costs
The Need for managing Information Systems
Managers used to describe their important resources as capital, equipment, raw material
and people excluding information. However, now a day’s information and information
systems have become the key organizational resources. As electronic commerce grows
in popularity and more firms digitize their operations, having useful information is
becoming even more important to the global business communities. Hence, the need
 managing information systems and services is crucial. Generally, information systems
are important in achieving:
• Organizational efficiency: by means of automating back office data processing
functions (TPS), using minimal resources to produce the desired output, using resources
wisely and in a cost effective way.
• Organizational effectiveness: through improved information flows and transfer(MIS),
making the right decision and successfully implementing them, doing the right thing in
the right way at the right times and solving problems and creating opportunities.
• Competitive advantage: enhance competitiveness of the organization through the
application of IT business processes(SIS)
• Value creation: by adding value to enhance the qualities of products and serves offered
by the organization, creating collaborative partnership and reaching consumers.
Definition of Information Systems Management (ISM)
-Information systems management is the planning, acquisition, development and uses
of information systems (Broader).
-Information systems management is the process of creating, implementing and
reviewing plans concerned with, information systems and information technology.
Key knowledge areas for Effective ISM
Careers in Information Systems
Help Desk Technician
Help desk technicians support end users in their daily use of IT, especially applications.
They may be part of an organizational help desk group or employees of an organization
that provides help desk to other organizations. In both cases, but especially in the latter,
they often provide help via the telephone. They may also communicate directly with a
user’s PC via a network and special software that gives them control of the user’s PC.
Help desk technicians are often required to have knowledge of a wide variety of PC
applications.
System Analyst
A systems analyst is responsible for researching, planning, and recommending software
and systems choices to meet an organization’s business requirements. Systems analysts
are normally responsible for developing cost analyses, design considerations,
implementation timelines, and feasibility studies of a computer system before making
 recommendations to senior management. A big part of this job includes developing
alternative system plans based on :
• analyzing system requirements provided by user input,

• documenting development efforts and system features, and

• (providing adequate specifications for programmers.

To succeed, systems analysts must possess excellent communication skills to translate

users’ descriptions of business processes into system concepts. They must understand
a wide range of business processes and ways in which IT can be applied to support
them. Most importantly, systems analysts must always keep in mind that they are agents
of change, and that most people resist change. Unlike many other occupations, system
analysis often involves the creation of new systems or the modification of existing ones.
Because new or modified systems often affect human activities and organizational
cultures, systems analysts must be able to convince both line workers and managers
that change will benefit them. Thus, these IS professionals must possess good
persuasive and presentation skills.

Database Administrator
The database administrator (DBA) is responsible for the databases and data warehouses
of an organization—a very sensitive and powerful position. Since access to information
often connotes power, this person must be astute not only technologically but politically
as well. He or she must evaluate requests for access to data from managers to determine
who has a real “need to know.” The DBA is responsible for developing or acquiring
database applications and must carefully
Network Administrator
Among the many IT areas, the one that has seen the most exciting developments in
recent years is networks and telecommunications. Not surprisingly, this area has also
seen the greatest increase in corporate allocation of IT resources in many organizations.
The emergence of new technologies, such as Voice over Internet Protocol and Wi-Fi,
and “Business Networks and Communications,” is expected to sustain this trend for
some years, allowing network professionals to be in great demand and to command
high salaries.
The network administrator is responsible for acquiring, implementing, managing,
maintaining, and troubleshooting local area networks throughout the organization and
their interfaces with the wide area networks such as the Internet. He or she is also often
involved in selecting and implementing network security measures such as firewalls
and access codes.
System Administrator
A system administrator—often referred to as “sys admin”—is responsible for
managing an organization’s computer operating systems. System administrators often
manage and maintain several operating systems, such as UNIX and Microsoft Windows
Vista, and ensure that the operating systems work together, support end-users’ business
requirements, and function properly. System administrators are also responsible for the
day-to-day maintenance of an organization’s operating systems, including backup and
recovery, adding and deleting user accounts, and performing software upgrades.
Webmaster
The rapid spread of the Web, intranets, and extranets has increased the responsibility
and stature of the organizational Webmaster. A Webmaster is responsible for creating
and maintaining the organization’s Web site as well as its intranet and extranet.
Webmasters are increasingly involved in creatively deciding how to represent the
organization on the Web. These decisions involve elements of marketing and graphic
design. Since many organizations use the Web for commerce, Webmasters must also
be well-versed in Web transaction software, payment-processing software, and security
software. In small organizations, the Web site may be the responsibility of a single
person. In large organizations, the Webmaster often manages a crew of programmers
who specialize in developing and updating code specifically for Web pages and their
links with other organizational ISs.
Chief Security Officer
Because of the growing threat to information security, many organizations have created
the position of chief security officer (CSO), or chief information security officer
(CISO). In most Organizations, the person in this position reports to the chief
information officer (CIO) (see next section), but in some cases the two executives report
to the same person, usually the chief executive officer (CEO). The rationale is that
security should be a business issue, not an IT issue. A major challenge for CSOs is the
misperception of other executives that IT security is an inhibitor rather than an enabler
to operations.
Chief Information Officer and Chief Technology Officer
The fact that a corporation has a position titled chief information officer (CIO) reflects
the importance that the company places on ISs as a strategic resource. The CIO, who is
responsible for all aspects of an organization’s ISs, is often, but not always, a corporate
vice president. Some companies prefer to call this position chief technology officer
(CTO). However, you might find organizations where there are both a CIO and a CTO
and one reports to the other. There is no universal agreement on what the responsibility
of each should be. Yet, in most cases when you encounter both positions in one
organization, the CTO reports to the CIO.
 Chapter three
2. Competing with Information Technology/Information Systems
Creating and maintaining competitive advantages
Organizations can create and maintain competitive advantage in different ways. Some
of these are:
1) Business process reengineering (BPR)

One of the most important implementations of competitive strategies is business

process reengineering (BPR), often simply called reengineering. Reengineering is a
fundamental rethinking and radical redesign of business processes to achieve dramatic
improvements in cost, quality, speed, and service. BPR combines a strategy of
promoting business innovation with a strategy of making major improvements to
business processes so that a company can become a much stronger and more successful
competitor in the marketplace.
The role of IT in BPR
Information technology plays a major role in reengineering most business processes.
The speed, information-processing capabilities, and connectivity of computers and
Internet technologies can substantially increase the efficiency of business processes, as
well as communications and collaboration among the people responsible for their
operation and management.
2) Becoming an Agile company

Agility in business performance means the ability of a company to prosper in rapidly

changing, continually fragmenting global markets for high-quality, high-performance,
customer-configured products and services.
An agile company can make a profit in markets with broad product ranges and short
model lifetimes and can produce orders individually and in arbitrary lot sizes. It
supports mass customization by offering individualized products while maintaining
high volumes of production.
The role of IT in Agility
Agile companies depend heavily on Internet technologies to integrate and manage their
business processes while they provide the information-processing power to treat their
many customers as individuals.
3) Creating a Virtual Company

In today’s dynamic global business environment, forming a virtual company can be one
of the most important strategic uses of information technology. A virtual company is
an organization that uses information technology to link people, organizations, assets,
and ideas.
Why do people form virtual companies? It is the best way to implement key business
strategies and alliances that promise to ensure success in today’s turbulent business
climate.
The basic Strategies of Virtual companies are: Share infrastructure and risk with
alliance partners.
• Link complementary 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.
4) Building a Knowledge Creating Company
Many companies today can only realize lasting competitive advantage if they become
knowledge-creating companies or learning organizations. That means consistently
creating new business knowledge, disseminating it widely throughout the company, and
quickly building the new knowledge into their products and services. Knowledge-
creating companies exploit two kinds of knowledge. One is explicit knowledge, which
is the data, documents, and things written down or stored on computers. The other kind
is tacit knowledge, or the “how-to” of knowledge, which resides in workers. This
knowledge represents the most important information of an organization.
Information Systems Planning
Overview of Planning
Systems planning, especially strategic systems planning, are becoming more difficult
and more important at the same time. Technology is changing so fast that it is seems
pointless to plan for it, yet the dependence on this technology makes planning its
effective use a matter of organizational life and death.
 Definitions of Planning
-Planning is the determination of the goals and objectives of an enterprise and the
selection, through a systematic consideration of alternatives, of the policies, programs
and procedures for achieving them.
-Planning is an activity devoted to clearly identifying, defining, and determining
courses of action, before their initiation, necessary to achieve predetermined goals and
objective.
Importance of Planning
- It is a systematic approach in dealing with future uncertainties
- Focuses on efforts and resources on long-term, general objectives and yet provides a
foundation for short-term activities
- Provides a framework for action

Types of Planning
There are mainly three types of planning in any organizations.
✓ Strategic planning (3-5 years): deals with the development of organization’s mission,
goals, strategies and, policies.
✓ Tactical planning (1-2 years): involves the design of tactics, the setting of objectives,
and the development of procedures, rules, schedules, and budgets.
✓ Operational planning (6 months – 1 year): planning on the short-term basis to
implement and control day-to-day operations.

Key concepts used in organizational planning process are mission, goals, objectives,
strategies, tactics, policies, and rules and procedures.
-Strategy is the definition of the future directions and actions of the company defined
as approaches to achieving specific objectives.
 Strategy is a specific action or pattern of actions that aligns the business with its
environment to create competitive advantage.
Successful strategies require defining and communicating the company’s unique
position, making tradeoffs, and creating (forging) fit among activities. Most
organizations use a hierarchy of strategies to support the business strategy. E.g.
marketing strategy, a personnel strategy, an Is/IT strategy,
Information systems planning (ISP)
Definition: ISP is a process of planning which brings together the business aims of the
organization, an understanding of the information needed to support those aims, and
the implementation of ICT to provide that information. It is a plan for the development
of systems towards some future vision of the role of information technology in the
organization.
ISP is a detained process and an integral part of deciding how to best deploy information
systems and technologies to help reach organizational goals. It is an orderly means of
assessing the information needs of an organization and defining the systems, databases
and technologies that will best satisfy those needs.
ISP involves identifying and modeling current and future organizational information
needs, and develop strategies and project plans to migrating the current information
systems and technologies to their desired future states.
ISP is also a process of deciding upon the optimal information, information systems,
and information technology architecture for an organization.
➢ Information architecture consists of activities involved in the collection, storage,
dissemination and use of information within the organization
➢ Information systems architecture is the basic blue print showing how the firm’s
information and communication technologies are integrated. It includes computing
platforms such as the basic types of computers, operating systems and networks. It also
incorporates legacy systems which are old and often obsolete systems that are still very
much in use.
Generally, information systems architecture consists of the information systems needed
to support organizational activity in the areas of collection, storage, dissemination and
use of information. The key characteristics of IS architecture are:
• Shows relationships between systems
• Does not specify time frame and
• Must be updated regularly
➢ Information technology architecture consists of the hardware, software,
communication facilities and IT knowledge and skills available to the organization.

Objectives of ISP
The key objectives of information systems include:
• To ensure that IS both complements and assists in the achievements of organizational
goals and competitive advantages
• To ensure that organizational IT/IS resources, including IS personnel, hardware,
software, data, and network resources are effectively and efficiently managed
• To achieve an integral view and approach to developing and implementing
organizational IS.

Characteristics of ISP
The key characteristics of ISP includes
• Cannot be considered independently of business strategy
• Must be continuous and dynamic, not a yearly or occasional activity
• Must be integrated at all levels of the managerial hierarchy
• Should lead in organizational innovation
• Uses top-down approach for identifying, developing and implementing IS, with the
following advantages;

- Broader perspectives - improved management support

- Improved integration - better understanding organizational needs
The Process of ISP
The process ISP is composed of three key activities.
i. Describing the current situation.
- This involves analyzing organizational missions, objectives and strategies
- determining the information requirements needed to meet each objectives
- addressing current IS- related assets- human resources, data, processes, and
technologies
ii. Describing the target situation, trends, and constraints
- Developing target situation that reflects the desired future situation that reflects the
desired future situation of the organization in terms of location, units, functions,
processes, data, information systems and so on
- Identifying technology trends, business treads and organizational constraints
- Determining the difference between the current and future situation to identify IS
projects and transition strategies. Finally, IS architecture will be developed as a
framework to represent the target situation.
-
iii. Developing IS strategies and Plans
- It is a comprehensive document reflecting broader and long range issues and
providing sufficient detail to guide all levels of management regarding what needs
doing, how, when, and by whom in the organization
IS Strategy
The practical output of IS planning is a document (or documents) which describes IS
strategy.
IS strategy is the process of identifying a portfolio of computer based applications to be
implemented, which is highly aligned with organizational strategy and has the ability
to create advantage over competitors. IS strategy being the plan an organization uses in
providing information systems and services.
IS strategy consisting of specification of the information systems needed to support
organizational activities in the areas of collection, storage, dissemination and use of
information. It is directed at avoiding fragmentation, redundancy, and inconsistency
amongst Information systems in an organization.
IS strategy is also directed at ensuring an effective ‘fit’ between the organization (the
organizational structure, its strategy, its business process, its environment) and its
information systems.
Rationale for IS Strategy
- organizations seek to utilize those technologies that give them competitive advantage
- IS allows business to implements its business strategy
- IS helps determine the company’s capabilities
- IS are costly ventures
- There are indicators that oftentimes organizational information systems are not used as
desired
Strategic uses of IS to achieve competitive advantage
Organizations’ can achieve business competitive advantage by making IS strategy
support the business and organizational strategy.
- The business value of information systems comes from supporting the most critical
business goals and helping the organization deliver on its business strategy. All
systems, whether supporting operational or strategic functions, must be linked to
business goals.
- Organizations use three primary business strategies to achieve competitive advantage.
• Differentiate products and services: make them better in the eyes of consumers
• Be-the lowest –cost producer: not just a low- cost producer
• Find a niche/focus- e.g. geographic market
Information systems can be used to help organizations achieve all the three strategies.
Organizations can use Information systems to:
Lower costs and create product and service differentiation
- Automation of processes: It can reduce labor and other overhead costs allowing
competition on price
- Personalization and improved customer service allowed by use of IT facilitates
differentiation
Create efficiencies which will help the company maintain its position
- Automation of processes
- Provide operational effectiveness: performing similar activities better than rivals
- Help maintain strategic positioning: performing different activities from rivals, and
performing similar activities differently
- Provides technological barriers which will stop other companies taking over its
position
Consequences of not having IS strategies
✓ System investments are made that do not support business objectives
✓ Systems are not integrated. This can lead to duplication of efforts and data leading to
inaccuracy and no coherent information resource
✓ No means of setting priorities for IS projects/ resources and constantly changing plans
leading to lower productivity
✓ No mechanism for deciding optimum resource levels or the best means of supplying
systems
✓ Poor management information, it is either not available, inconsistent, inaccurate or too
slow
 Chapter four
4. Managing System Development
a. Distributed Systems