Chapter 1 Intro to Information Systems (IS)

1.1 Why this course?

Information technology (IT): any computer-based tool that people use to work with information
and to support the inf and info-processing needs of an organization.
Information system (IS): collect, process, analyze, and disseminate info for a specific purpose.
● MIS: Management information system
Informed user (me): a person knowledgeable about IS and IT.

IT jobs
● CIO: highest-ranking IS manager, responsible for all strategic IS planning in the firm.
Although most CIO rise from the IS department, but CIO could also come from other
departments like finance, marketing.
● IS director: manages all systems throughout the firm and the day-to-day operations of
the entire IS organization.
● Info centre manager: manages IS services such as helpdesks, hotlines, training, and
consulting.
● APP dev manager: coordinates and manages new systems development projects.
● Project manager: manges a particular new system dev project
● System manager: manages a particular existing system.
● Operations manager: supervises the day-to-day operations of the data and/or computer
centre.
● Programming manager: coordinates all app’s programming efforts.
● System analyst: interfaces between users and programmers, determines info
requirements and technical specs for new apps.
● Business analyst: focuses on designing solutions for business problems, interraces
closely with users to demonstrate how IT can be used innovatively.
● Systems programmer: creates the computer code for developing new system software
or maintaining existing systems software.
● Applications programmer: creates the computer code for developing new app or
maintaining existing one.
● Emerging tech manager: forecasts tech trends, evaluates and experiments with new
tech.
● Network manager: coordinates and manages the organization’s voice and data
networks.
● Database administrator: manages the firm’s databases and oversees the use of
database-management software.
● Auditing or computer security manager: oversees the ethical and legal use of IS and
evaluates the quality or effectiveness of such systems.
● Webmaster: manages the firm’s website.
● Web designer: creates websites and pages.
Managing information resources
Managing IS in modern companies is a complex task, due to 3 factors:
1. IS have enormous strategic value to companies.
2. IS are very expensive to acquire, operate, and maintain.
3. Evolution of the MIS function within the company.

End-user computing has 2 components:

1. End-user data entry, reporting, and inquiry
2. End-users development: users develop usale systems, such as spreadsheets or
programs.

The responsibility for managing info resources is divided between the MIS department and
the users. The division depends on these factors:
● Size and nature of the organization
● Amount and type of IT resources
● Organization and top management’s attitudes toward computing
● Maturity level of the tech
● Amount and nature of outsourced IT work
● Countries in which the company operates

Functions of traditional MIS department:

● Managing system development and systems project management
● Managing computer ops (computer centre)
● Staffing, training, and development IS skills
● Providing technical services
● Infrastructure planning, development and control

Functions of new MIS department:

● Initiating and designing specific strategic IS
● Incorporating the Internet and e-commerce into the business
● Managing system integration, including the Internet, intranets, and extranets
● Educating the non-MIS managers about IT
● Educating the MIS staff about the business
● Partnering with business unit executives
● Managing outsourcing
● Proactively using business and technical knowledge to see innovative ideas about IT
● Creating business alliances with business partners.

1.2 Overview of computer-based IS

Function of MIS: planning for and the development, management, and use of IT tools to help
people perform all the tasks related to information processing and management.

Data: raw descriptions of things, events, activities, and transactions that are recorded,
classified, and stored but are not organized to convey any specific meaning.
Information: data that have been organized to that they have meaning and value to the
recipient.
Knowledge: consists of data and/or information that have been organized and processed to
convey understanding, experience, accumulated learning, and expertise as they apply to a
current business problem.

Computer-based IS: IS that uses computer tech to perform some or all of its intended tasks.
Basic component of computer-based IS:
1. Hardware
2. Software
3. Database
4. Network
The first 4 components are called IT components.
5. Procedures: instructions for combining the above components to process information
and generate the desired output.
6. People: users

● IT platform: formed by IT components (hardware, software, database and network)

● IT services: IT personnel use the components to develop IT services (IS, oversee
security and risk, and manage data).
● IT infrastructure: composed of IT component + IT services

Major capabilities of IS:

 ● Perform high-speed, high-vol numerical computations
● Provide fast, accurate communication and collaboration within and among organizations.
● Store huge amount of info in an easy-to-access, yet small space
● Allow quick and inexpensive access to vast amount of info worldwide
● Interpret vast amounts of data quickly and efficiently
● Automate both semi-automatic business processes and manual tasks.

App: computer program designed to support a specific task or business process.

Types of organizational IS
Functional area IS (FAIS): supports a particular functional area within an organization.
Eg. accounting IS, finance IS, production/operations management (POM) IS

2 IS that support the entire organization (intra organization IS)

1. ERPs (Enterprise resource planning systems): integrates all functional areas of the
company. Designed to correct a lack of communication in the functional area IS.
Eg. Oracle, SAP
2. TPS (Transaction processing system): support the monitoring, collection, storage, and
processing of data from the org’s basic business transaction, each of which generates
data.
Note: nearly all ERP systems are also TPS, but not all TPS are ERP systems.

2 IS that connect many organizations (interorganizational IS aka IOS)

1. Supply chain management system: manage flows of products, services, and info
among organizations.
2. E-commerce system: enables B2B and B2C transactions

Other types of organizational IS

● Office automation system: support daily work activities of employees. Eg. MS Office
● Management information system: produces reports summarized from transaction
data, usually in one functional area. Eg. report on total sales
● Decision support system: provides access to data and analysis tools. Eg. “what-if”
analysis of changes in budget.
● Expert system: mimics human experts in a particular area and makes decisions. Eg.
credit card approval analysis.
● Executive dashboard: presents structured, summarized info about aspects of business
important to executives. Eg. status of sales by product.

1.3 How does IT affect organizations?

● IT reduces the number of middles managers
○ Increases managers’s productivity
○ Increases the number of employees who can report to a single manager
○ Decreases the number of managers and experts
● IT changes the manager’s job
○ Provides real-time info: increased vol of info, less time to make a decision
○ Supervises employees remotely
● IT affects employees
○ Ergonomics: science of designing machines and work settings that minimize
injury and illness.
Eg. anti glare screen, computer chair.
Quiz 1
1. You should seek to be an informed user of IT because you will be in a position to
enhance the quality of IT applications.
2. Who manages all systems throughout the org and the day to day operations of the entire
IS organization? IS director.
3. IT personnel use IT components to develop IT services.
4. Providing technical services is a traditional function of the MIS department.
5. You take into account your major, courses you need, professors teaching each section
into account to register for courses. You are using knowledge to select your class
schedule.
6. Which of the following is the correct hierarchy from the lowest level to the highest level?
data->information->knowledge
7. What does a system analyst do? Determines info requirements and technical specs
for new apps.
8. You have just been hired by the largest manufacturer in your area to join their
management trainee program. You enjoyed your "computer course" in college and hope
that you'll be able to put that knowledge to good use. Which of the following might you
expect to do during the management training program? Become familiar with tools to
support using data for decision making.
9. In your new position, you are told that you will be working with a business analyst. What
would you expect this work to entail? Explain the business process
10. Which of the following is a benefit of being an informed user of IT?

Tech guide 1
TG 1.1 Intro to hardware
Hardware consists of:
● CPU: manipulates the data and controls the tasks performed by other components.
● Primary storage: temporarily stores data and program instructions during processing.
● Secondary storage: stores data and programs for future use.
● Input tech: accept data and instructions and convert them to a form that the computer
can read.
● Output tech: present data and info in a form people can understand.
● Communication tech: provide for the flow of data from external computer networks to the
CPU, and vice versa. Eg. Internet and intranets.

TG 1.2 Strategic hardware issues

Some importants issues are what the hardware enables, how it is advancing, an how rapidly it is
advancing.

TG 1.3 computer hierarchy

From the most powerful to the least powerful types of computer:
 ● Supercomputers: eg. used in large banks, health care organizations to analyze giant
databases.
● Mainframe computers: popular in large enterprises for extensive computing
applications that are accessed by thousands of users at one time.
Eg. airline reservation system, corp payroll system, website transaction processing
systems (Amazon), student grade calculation and reporting.
● Microcomputers (PC)
● Laptop and notebook
○ Thin client: Chromebook
○ Fat client: Windows
● Tablets: also have the capacity of providing AR
● Wearables

TG 1.4 Input and output tech

Multimedia tech: computer-based integration of text, sound, images, animation, and video,
usually consists of a collection of various input and output tech.

TG 1.5 CPU
● Control unit: sequentially accesses program instructions, decodes them, and controls
the flow of data to and from the arithmetic logic unit, registers, caches, primary storage,
secondary storage, and various output devices.
● Arithmetic logic unit (ALU): performs math calculations and makes logical
comparisons.
● Register: high-speed storage areas that store very small amounts of data and
instructions for short periods.

Moore’s law: microprocessor complexity would double approximately every 18 months.

Computer memory
Memory capacity: byte-kilobyte-megabyte-gigabyte-terabyte-petabyte-exabyte-zettabyte
 ● Primary storage: stores 3 types of info for very brief period of time:
1. Data to be processed by CPU
2. Instructions for CPU as to how to process the data
3. OS programs that manage various aspects of the computer’s operation
Primary storage takes place in chips mounted on the motherboard.
4 types of primary storage:
1. Register: part of CPU, has the least capacity, storing instructions and data only
immediately before and after processing.
2. Cache memory: temporarily store blocks of data that are used more often.
Faster than RAM.
3. RAM (random access memory): temporary, volatile, part of primary storage that
holds a program and small amounts of data for processing.
4. ROM (read-only memory): nonvolatile, storage for critical instructions (eg. boot
instructions)
Note: when power-off, data in the registers, cache and RAM are lost.
● Secondary storage: nonvolatile, slower
and cheaper than primary storage
○ Hard drives
○ Solid state drives (SSD): use
less power, more silent, faster,
and cost more than HD

Tech guide 2 Software

System software: intermediary between
hardware and functional apps.
Documentation: included in computer program, which is a written description of the program’s
functions. Documentation helps the user to operate the computer system, and it helps
programmers understand the program.
TG2.1 Software issues
1. Software defects
2. Software licensing
3. Open systems: a group of computing products that work together.
a. In an open system, the same OS with compatible software is installed on all
computers that interact within a company.
b. Complementary approach is to empoy APPs that will run across all computer
platforms.
4. Open-source software
Advantages: High-quality, reliable, low cost, flexible, more bugs are discovered quickly.
Drawback: depending on the continued goodwill of volunteers, companies who use
open-source software do not have in-house technical experts to support, and
compatibility issues with existing systems in the company.
 Eg. GNU, Ubuntu, Apache, SMTP, Perl, Firefox, LibreOffice, Moodle, MySQL

TG2.2 Systems software

System software: a set of instructions that serves primarily as an intermediary between
computer hardware and APPs.
Function of system software:
● Controls and supports the computer system and its info-processing activities
● Controls and supports computer peripherals (eg. printer)
● Enables computer systems to perform self-regulatory functions by loading itself when the
computer is first turned on.
● Provides commonly used sets of instructions for all apps
● Supports app software by directing the computer’s basic functions.

Operating system: supervises the overall operation of the computer by monitoring the
computer’s status, scheduling operations, and managing input and output.

GUI (graphical UI): allows users to directly control the hardware by manipulating visible objects
and actions that replace complex commands. Eg. Windows, VR, speech input/output,

Social interface: guides the user through computer apps by using cartoon-like characters,
graphics, animation, and voice commands. Eg. Avatars

TG2.3 Application software

App software: set of computer instructions that provides specific functionality to a user.
Personal app software: general-purpose, off-the-shelf app programs designed to help
individual users increase their productivity. Eg. Spreadsheet, word processing, data
management, presentations, graphics, personal finance, communication.

Tech guide 3 Cloud computing

Cloud computing: a type of computing that delivers convenient, on-demand, pay-as-you-go
access for multiple customers to a shared pool of configurable computing resources (eg.
servers, networks, sotrages, apps) that can be rapidly and easily accessed over the Internet.

TG3.1 Intro to cloud computing

Different stages of the modern IT infrastructure:
1. Stand-alone mainframe: mainframe computers typically housed in a secure area, and
only MIS personnel had access to it.
2. Mainframe and dumb terminals: enalbes users to input computer programs into the
mainframe from their departments, aka remote job entry.
3. Stand-alone PC
4. LAN (Local area network): Organizations connect PCs to LANs and then connect these
LANs to the mainframe for productivity, aka client/server computing.
 5. Enterprise computing: all types of hardware were networked (mainframes, PCs, smart
phones, printers, etc).
6. Cloud computing and mobile computing

On-premise computing (traditional): companies own their IT infrastructure (their software,

hardware, networks, data management etc) and maintain it in their data centres.

TG3.2 What is cloud computing?

Cloud computing characteristics
● Elasticity and flexibility for users
● Grid computing: pools various hardware and software components to create a single IT
environment with shared resources.
Grid computing:
○ Enables organizations to use their computing resources more efficiently
○ Provides fault tolerance and redundancy. Ie. there is no single point of failure
○ Makes it easy to scale up (to access increased computing resources) to meet the
processing demands of complex applications.
○ Makes it easy to scale down (remove computing power) if extensive processing
is not needed.
● Utility computing: cloud computing provider charges users for its specific usage, the
costs vary according to user’s need.
● Uses board network access: cloud computing available over a network, accessed with
a web browser, and can be configured to use with any computing device.
● Pools computing resources: resources available to serve multiple customers, they are
assigned and reassigned according to customer demand.
● Occurs on virtualized servers: cloud computing providers have placed many
networked servers inside massive data centres called server farms.
○ Server: a computer that supports a network, thus enabling users to share files,
software, and other network devices.
○ Server virtualization: uses software-based partitions to create multiple servers
called virtual machines on a single physical server.

TG3.3 Different types of clouds

● Public clouds: shared, easily accessible, multi-customer IT infrastructures that are
available non exclusively to individuals, groups or organizations.
Public cloud vendors provide: applications, storage, and other computing resources as
services over the Internet.
● Private clouds (aka: internal clouds or corporate clouds): IT infrastructures that can
be accessed only by a single entity.
● Hybrid clouds: composed of public and private clouds that remain unique entities, but
are nevertheless tightly integrated.
Hybrid clouds deliver services based on:
○ Security requirements
 ○ Mission-critical nature of the applications
○ Other company-established policies
● Vertical clouds: build cloud infrastructure and applications for different businesses.

TG3.4 Cloud computing services

● Iaas (Infrastructure-as-a-service) model: a model with which cloud computing
providers offer remotely accessible servers, networks, and storage capacity.
● PaaS (Platform-as-a-service) model: a model with which customers rent servers, OS,
storage, database, software dev tech such as Java and network capacity over the
Internet.
● Saas (Software-as-a-service) model: a delivery model with which cloud computing
vendors provide software that is specific to their customers’ requirements.

TG3.5 Benefits of cloud computing

1. Cloud computing has a positive impact (flexible and easy access) on employees.
2. Cloud computing can save money
3. Cloud computing can improve organizational flexibility and competitiveness.

TG3.6 Concerns with cloud computing

1. Legacy IT systems: old IT systems resist the efforts to transformation to cloud computing
2. Reliability
3. Privacy
4. Security
5. Regulatory and legal environment
6. Criminal use of cloud computing

TG3.7 Web services and service-oriented architecture

Web services: applications delivered over the Internet (cloud) that MIS professional can select
and combine through almost any device.
Advantages of web services:
● Company can use the existing Internet infrastructure without having to implement any
new tech
● Company personnel can access remote or local data without having to understand the
complexities of this process.
● Company can create new applications quickly and easily

Service-oriented architecture: a collection of web services that are used to build a firm’s IT
application.

Web services are based on 4 key protocols:

1. XML (Extensible markup language): computer language that makes it easier to
exchange data among apps and to validate and interpret these data.
Note: XML is more powerful and flexible than HTML
 2. SOAP: a set of rules that define how messages can be exchanged among different
network systems through the use of XML
3. WSDL: used to create XML documents that describe the tasks performed by the various
web services.
4. UDDI: allows MIS professionals to search for needed web services by creating public or
private searchable directories of these services. UDDI is the registry of description of
web services.

Chapter 2 Organizational strategy, competitive advantage,

and IS
2.1 Business pressures, organization responses, and IT support
Business environment: the combination of social, legal, economic, physical, and political
factors in which businesses conduct their operations.

3 types of business pressures:

1. Market pressures are generated by:
a. Global economy and strong competition
Globalization: the integration and interdependence of economic, social, cultural,
and ecological facets of life, made possible by rapid advances in info tech.
A major business pressure in the global economy to consider is the cost of
labor.
b. Need for real-time operations
c. Changing nature of the workforce: eg. work from home
d. Powerful customers
● Customers are evolving to be able to find more info about products,
services, compare prices, and e-commerce, etc.
● Customer intimacy: a component of customer relationship management
(CRM), which is the process that modern firms strive to learn as much as
possible about their customers to better anticipate and address their
needs.
2. Tech pressures
a. Tech innovations and obsolescence
b. Information overload
3. Societal pressures
a. Social responsibility
organization/individual social responsibility: effort to spend time and money to
address various social problems.
“Green IT” addresses the social responsibility in 3 areas:
1. Facilities design and management
2. Carbon management
3. International and US environmental law
 Digital divide: the wide gap between those people who have access to info and
communication tech and those who do not.
b. Compliance with government regulations
c. Protection against terror attacks
d. Ethical issues

Organizational responses
Organizations respond to these pressures by implementing IT such as:
● Strategic system: provide org with advantages that enable them to increase their
market share and profits, to better negotiate with suppliers.
● Customer focus: provide better customer service
● Make-to-order and mass customization: shift from mass production to mass
customization (a firm produces a large quantity of items, but it customized them to
match the needs and preferences of individual customers).
● e-business/commerce:

2.2 Competitive advantage and strategic IS

Strategic info systems (SIS): provide a competitive advantage by helping an org implement its
strategic goals and improve its performance and productivity.

Competitive advantage: any assets that provide an org with an edge against its competitors in
some measure such as cost, quality, or speed.

Porter’s competitive forces model

1. The threat of entry of new competitors: entry barrier (a product or service feature that
customers have learned to expect from org in a certain industry).
2. Bargaining power of suppliers
3. Bargaining power of buyers (customers)
4. The threat of substitute
5. Rivalry among existing firms in the industry

Porter’s value chain model

Value chain: a sequence of activity through which the org’s input is transformed into more
valuable output.

Value chain model: identifies points where an org can use info tech to achieve competitive
advantages. According to this model, activities conducted in any organization can be divided
into 2 categories:
1. Primary activities: activities related to the production and distribution of the firm’s
products and services. They create value for which customers are willing to pay.
Eg. For a manufacturing company, primary activities are purchasing materials,
processing the materials, and delivering products to customers.
Inbound logistics (input) -> operations (manufacturing) -> outbound logistics (storage
and distribution) -> Marketing and sales -> services
 2. Support activities: activities that contribute to the firm’s competitive advantage by
supporting the primary activities. They do not add value directly to the firm’s products
and services.
Eg. firm’s infrastructure (accounting, finance, management), HR management, R&D,
procurement
Value system: includes the suppliers that provide the inputs along with their value chain.

Strategies for competitive advantage

1. Cost leadership strategy: produce products or services at the lowest cost in the industry.
2. Differentiation strategy: offer different product features or services than your competitor.
3. Innovation strategy: introduce new products and services, add new features to existing
one, or develop new ways to produce them.
4. Operational effectiveness strategy: improve the manner in which a firm executes its
internal business processes so that it performs these activities more effectively than its
rivals.
5. Customer orientation strategy: centrentrate on making customers happy.
Eg. web-based system

Business-IT alignment: the integration of the IT function with the organization’s strategy,
mission, and goals.
However, many organizations fail to implement good business-IT alignment because:
● Business managers and IT managers have different objectives
● Business and IT departments are ignorant of the other group’s expertise
● Lack of communication

Quiz 2
1. Which of the following statements is false?
Competitive advantage requires the use of tech.
2. What major supplier can help Blackberry to be a leader of self-driving cars?
QNX
3. Applying copyrights and trademarks is an example of a marketing business process.
4. One of the key benefits of the App developed by NASCAR is the cumulative value of the
collected data that includes information on the pre-race inspections of all vehicles is
collected and stored in real time. What can NASCAR executives identify with this data?
Trends and patterns to help maintain a level playing field for all racers.
5. Managing purchasing is an example of a production business process.
6. Collecting sales tax is an example of a finance business process.
7. Which of the following statements concerning business processes is false?
A process cannot cross functional area boundaries.
8. Reconciling bank accounts is an example of an accounting business process.
9. Managing pay and payroll is an example of a human resources business process.
10. What types of applications did Nascar develop in order to incorporate all the items on the
paper-based form?
 A dashboard view that displays each vehicle along with its progress through the
inspection process.

------------------------------------------ MIDTERM 1 -----------------------------------

Midterm 2:
PlugIn 1 Business process
1.1 Business process: an ongoing collection of related activities that create a product or
service of value to the organization, its business partners, and/or its customers.
Business process involves 3 fundamental elements:
1. Inputs: materials, services, info flow from process activities
2. Resources: people and equipment that perform process activities
3. Outputs: the product or service created by the process
Customers can be: internal (manager who is the recipient of an internal report) or external.

Process activities are measured by 2 metrics:

1. Efficiency: focuses on doing things well in the process. Eg. progressing from one
process to another without wasting money.
2. Effectiveness: focuses on doing the things that matter. Eg. creating high-quality
products for customers.

Cross functional processes: multiple functional areas collaborate to perform the process, no
single functional area is responsible for a process’s execution.
● Accounting business processes
● Finance business processes
● Marketing business processes
● Production/operations management business processes
● HR business processes
● Management IS business processes
Eg. procurement and fulfillment are cross-functional business processes.

IS and business process

IS (info systems) play a vital role in 3 areas:
1. Executing the process: IS generates purchase requisitions and informs the purchasing
department.
2. Capturing and storing process data: IS captures customers’ data
3. Monitoring process performance: IS can track the status of a particular customer
order.

1.2 Business process improvement and BPR

Measures of competitive performance in a firm:
 ● Customer satisfaction: result of optimizing processes to fulfill customers’ needs, wants,
desires.
● Cost reduction: result of optimizing operations and supplier process.
● Cycle and fulfillment time reduction: result of optimizing the manufacturing and
logistic processes.
● Quality: result of optimizing the design, dev and production process.
● Differentiation: result of optimizing the marketing and innovation processes.
● Productivity: result of optimizing each individual’s work processes.

Business process reengineering (BPR): a radical redesign of a business process that

improves its efficiency and effectiveness, often by beginning with a “clean sheet (from scratch)”.
Eg. popular thanks to unique capabilities of IT (eg. automation) and error reduction (better
communication)

Business process improvement (BPI): a less radical, less disruptive, and more incremental
approach than BPR preferred by some organizations.
Eg. Six Sigma is a methodology for BPI used in financial and healthcare services.
BPI project follows 5 basic phases:
1. Define phase
2. Measure phase
3. Analysis phase
4. Improve phase
5. Control phase

Business process management (BPM):

Goal: sustain BPI efforts over time.
Definition: a management system that includes methods and tools to support the design,
analysis, implementation, management, and continuous optimization of core business
processes throughout the organization.
Important components of BPM are:
● Modeling: graphical depiction of all of the steps in a process.
● Web-enabled tech: display and retrieve data via web browser.
● Business activity monitoring (BAM): real-time approach for measuring and managing
business processes.

Chapter 3 Intro to business process

Functional structure: organizational structure that divides the organization into
functions/departments.
 ● Each function/department is a silo (vertical)
● Cross-functional process (horizontal)
Silo effect: workers complete their tasks in their functional silos without regard to the
consequences for the other components in the process. Ie. not seeing the big picture

Regardless of an organization’s size and function, it uses processes and ES to achieve its
goals.
Enterprise systems (ES): systems that support end-to-end processes, and are essential to the
efficient and effective execution and management of business process. Eg. system to
coordinate design department in Germany and manufacturing in China.

Business process: a set of tasks or activities that produce desired outcomes:

1. Triggers: every process is triggered by some event, eg. receiving customer order
2. Functional area 1, 2, 3…
3. Outcomes

Types of business processes:

Related to creating and delivering G+S:
● Procurement process (buy)
 ● Production process (make)

● Fulfilment process (sell)

Related to the product and service itself:

● Lifecycle data management process (design): design and dev of products from initial
product idea stage through the discontinuation of the product.
● Material planning process (plan): uses historical data and sales forecasts to plan
which materials will be procured and produced.
Goal: to match the supply of materials with the demand.
● Inventory and warehouse management (IWM) process (store): used to store and track
the materials.
● Asset management and customer service process (service): used to maintain internal
assets such as machinery and to deliver customer service such as repairs.
○ Preventive maintenance: routine maintenance of machine
○ Corrective maintenance: repairs
Support processes related to people and projects:
● Human capital management (HCM) processes (people): focus on internal staff
management (eg. hiring)
● Project management processes (projects): projects are temporary in nature, while most
business processes are ongoing or repetitive.
Projects can be internal or external:
● Internal: the outcome of the project benefits the firm and is not sold to a
customer. Eg. build a manufacturing plant.
● External: the outcome is sold to customers. Eg. build an aircraft for a customer.
Tracking the financial impacts:
● Financial accounting (FI) processes (track-external): track the financial impacts of
process with the goal of meeting legal reporting requirements (eg. IRS, SEC)
 Companies analyze the impacts using 4 key processes:
○ General ledger: tracking income, expenses, assets, and liabilities
○ Accounts payable
○ Accounts receivable
○ Asset accounting: tracking financial data related to assets such as machinery
● Management accounting or controlling process (track-internal): focus on internal
reporting to manage costs and revenues.

SAP: created as an enterprise system to integrate sales systems, accounting systems, and
manufacturing systems, etc in a single system with a single database.

Chapter 4 Intro to Enterprise systems (ES)

Architecture of ES: the technical structure of the software, the ways users interact with the
software, and the ways the software is physically managed on hardware.
● Client-server architecture
Apps under this structure consists of 3 layers:
1. Presentation layer: UI (eg. browser)
2. Application layer: App functions itself. (eg. websites with email function)
3. Data layer: where the app stores your work. (eg. store your data on their server)
In contract, a 3-tier client-server architecture separates these layers into 3 separate
systems.
2 benefits of C-S architecture:
1. Dramatically reduce the cost of acquiring, implementing, and using an ES
2. Increase the scalability of the systems.
Scalability: ability of the hardware and software to support a greater number of
users over time at a decreasing cost per user.
● Service-oriented architecture
Goal: allow systems to connect with one another through standardized interfaces called
Web services. Companies could build up composite (mash-ups) apps on top of their
existing 3-tier C-S apps without changing the underlying apps.

Enterprise resource planning (ERP) systems

ERP: world’s most complex ES, focused primarily on intra-company processes (within a
company) to integrate functional and cross-functional business processes.
Eg. SAP

Inter-company processes are also needed in business:

● Supply chain management (procurement & mats planning processes): connect the
firm to its suppliers to plan for their requisitions and optimize logistics.
● Supplier relationship management (procurement & mats planning processes):
manage suppliers with the quote and contracts processes.
● Customer relationship management (fulfillment process): connect the firm to the ERP
system of its customers to manage marketing, sales and customer services.
 ● Product lifecycle management: help companies administer the processes of R&D,
connect the firm to manufacturing facilities.
Application suite: the collection of the above
----------------------------------------------------Midterm 2---------------------------------------------------------
Midterm 3:
Chapter 6 Data and knowledge management
ERD (Entity relationship diagram)
ERD consists of:
● Entities: pictured in rectangles.
● Attribute: list of attributes for each entity, and the primary key is underlined.
● Relationships: represented by a line between 2 entities.
Degree of relationship: the number of entities associated with a relationship.
○ Unary relationship: single entity
○ Binary relationship: most common, 2 entities.
○ Ternary relationship: 3 entities associated.

Cardinality: the max number of times an instance of one entity can be associated with
an instance in the related entity.

Connectivity:
● One-to-one: students may register only one car at this university.
● One-to-many: professors may teach more than one class, and class can only be
taught by a professor.

● Many-to-many: students can register for one or more classes, and each class
can have one or more students.

Note: most database systems don’t support many-to-many relationships. So use

junction (bridge) tables to have 2 one-to-many relationships.
Note: Student ID and Class ID are foreign keys in the registration table.