Lecture-02

Information Systems in
Global Business

1
 Slide Content

• Concept of management, information and systems.

• Definition and purpose of MIS
• Characteristics or features of MIS
• Qualities of an Excellent Manager
• Managers in the field of MIS

2
Information System
An information system can be defined technically
as a set of interrelated components that collect
(or retrieve), process, store, and distribute
information to support decision making and
control in an organization.

3
Components of Information System
• 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 (wired 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 those individuals who use the hardware and
software, interface with it, or use its output.
4
Role of Information System in Business
• Information systems are a foundation for conducting business
today.
• In many industries, survival and the ability to achieve strategic
business goals are difficult without extensive use of information
technology.
• Businesses today use information systems to achieve six major
objectives:
– operational excellence
– new products, services, and business models
– customer/supplier intimacy
– improved decision making
– competitive advantage and
– day-to-day survival.
5
Role of Information System in Business
• Operational excellence:
– Improvement of efficiency to attain higher profitability.
– Information systems, technology an important tool in
achieving greater efficiency and productivity.

• New products, services, and business models:

– Business model: describes how company produces, delivers,
and sells product or service to create wealth.
– Information systems and technology a major enabling tool
for new products, services, business models.
• Examples: Apple’s iPod, iTunes, iPhone, iPad, Google’s
Android OS, and Netflix.

6
Role of Information System in Business
• Customer and supplier intimacy :
– Serving customers well leads to customers returning,
which raises revenues and profits.
Example: High-end hotels that use computers to
track customer preferences and use to monitor
and customize environment.
– Intimacy with suppliers allows them to provide vital
inputs, which lowers costs.
Example: J.C. Penney’s information system which
links sales records to contract manufacturer.

7
Role of Information System in Business
• Improved decision making:
– Without accurate information:
• Managers must use forecasts, best guesses, luck
• Leads to:
– Overproduction, underproduction of goods
and services
– Misallocation of resources
– Poor response times
• Poor outcomes raise costs, lose customer

8
 Role of Information System in Business
• Improved decision making:
– Helps managers make faster human resource decisions
– Promotions or transfers, by integrating all employee records
across the organization.
– Managers are able to quickly review employee performance
ratings for the previous three years and drill down into more
details
• Competitive advantage:
– Delivering better performance
– Charging less for superior products
– Responding to customers and suppliers in real time
– Examples: Apple, Walmart, UPS

9
Role of Information System in Business
• Survival:
– Information technologies as necessity of business
– May be:
• Industry-level changes, e.g. Citibank’s
introduction of ATMs
• Governmental regulations requiring record-
keeping
– Examples: Financial regulatory agencies
such as the U.S. Securities and Exchange
Commission (SEC), Financial Conduct
Authority (FAC UK),

10
Role of Information System in Business
The Interdependence Between Organizations and Information Technology

Figure: In contemporary systems there is a growing interdependence between a firm’s

information systems and its business capabilities. Changes in strategy, rules, and
business processes increasingly require changes in hardware, software, databases, and
telecommunications. Often, what the organization would like to do depends on what its
systems will permit it to do.
11
Information Technology
• Information technology (IT) consists of all the
hardware and software that a firm needs to use in
order to achieve its business objectives.

• This includes not only computer machines, storage

devices, and handheld mobile devices, but also
software, such as the Windows or Linux operating
systems and the many thousands of computer
programs.

12
Perspectives on Information Systems
• Information Systems Are
More Than Computers

• Understanding the interaction

between these factors and
information systems is known
as information system
literacy.

Figure: Using information systems effectively requires an understanding of the

organization, management, and information technology shaping the
systems. An information system creates value for the firm as an
organizational and management solution to challenges posed by the
environment.

13
Information Technology

Figure: The study of information systems deals with issues and insights
contributed from technical and behavioral disciplines.

14
Information Technology
• Technical approach
– Emphasizes mathematically based models
– Computer science, management science,
operations research

• Behavioral approach
– Behavioral issues (strategic business integration,
implementation, etc.)
– Psychology, economics, sociology

15
Information Technology
• Management Information Systems
– Combines computer science, management science,
operations research and practical orientation with
behavioral issues

• Four main actors

– Suppliers of hardware and software
– Business firms
– Managers and employees
– Firm’s environment (legal, social, cultural context)

16
INTERACTIVE SESSION: TECHNOLOGY
• Digital Transformation of Healthcare at
Singapore’s JurongHealth Services.
• See the Page Number: 51 in Chapter 1.
• Read the Case Study and try to find the
Answer for the Questions are provided.

17
 Review Questions

1. Identify three major new information system trends.

2. Describe the characteristics of a digital firm.
3. List and briefly describe the six strategic business
objectives of information systems.
4. Define Information System with it’s components.
5. Explain the concept of contemporary approaches to
Information Systems.
18
Every end is a new beginning!!!

19