Information Systems (IS) Rev: Feb, 2012 Euiho (David) Suh, Ph.D. POSTECH Strategic Management of Information and Technology Laboratory (POSMIT: )

Information Systems (IS)Rev: Feb, 2012

Euiho (David) Suh, Ph.D.

POSTECH Strategic Management of Information and Technology Laboratory(POSMIT: http://posmit.postech.ac.kr)

Dept. of Industrial & Management EngineeringPOSTECH

Contents※ Discussion Questions

1 Information Systems

1) Introduction

2) Components of IS

3) General role of IS

2 Information Systems in Management

1) Problem types

2) The relationship between IS and Management

3) The role of IS in Management

3 Case Study

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Discussion Questions (1/2)

■ Explain the difference between data and information.

■ In a larger extent, what is the difference among data, information, decision aids, and knowledge ? (Refer to No. 6 PPT)

■ Refer to THREE key attributes of information. Are the attributes of information mutually independent ?

■ What is the least important component of IS among 6 components?

■ What is the ultimate purpose of information systems ?

■ DSS more focuses on solving (structured, semi-structured, unstructured) prob-lem than (structured, semi-structured, unstructured). Justify your answer.

■ Take an example of a semi-structured model and suggest how to solve it using an IS.

■ By using IS, what were benefits E-mart gained?

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Discussion Questions (2/2)

■ Case 1 in textbook (pp. 5~6, Chapter 1)– How do information technologies contribute to the business success of the companies

depicted in the case? • Provide an example from each company, explaining how the technology implemented led to im-

proved performance

– The Bryan Cave law firm used BI technology to improve the availability, access, and presentation of existing information; this allowed them to provide tailored, innovative services to customers• What other professions could benefit from a similar use of these technologies, and how?

■ Discussion questions in textbook (p. 39, Chapter 1)– Refer to the Real Word Case on eCourier, Cablecom, and Bryan Cave in the chapter. Jay

Bregman, CTO and cofounder of eCourier, notes the company hopes their innovative use of technology will become a differentiator in their competitive market. More gen-erally, to what extent do specific technologies help companies gain an edge over their competitors? How easy or difficult would be to imitate such advantages?

– Why do big companies still fail in their use of information technology? What should they be doing differently?

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What is Information?

■ Definition of Data– Raw facts, typically about physical phenomena or business transactions

• Specifically, objective measurements of the attributes of entities such as number, name, etc.

■ Definition of Information Facts that are organized and arranged in a meaningful manner.

■ Data vs. Information (statistical analysis)

■ Attributes of information– Accuracy– Timeliness– Relevance – Completeness– Reliability– Simplicity– Verifiability– Flexibility– Economy

Data InformationThe transformation process

1. Information Systems1) Introduction

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What is a System?

■ Definition of System– A set of interrelated components, with a clearly defined boundary, working together to

achieve a common set of objectives by accepting inputs and producing outputs in an organized transformation process

Input

• Capturing and assem-bling ele-ments that enter the sys-tem to be processed

Processing

• Transforma-tion process converts in-put into out-put

Output

• Transferring transformed elements to their ultimate destination

1. Information Systems1) Introduction

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What is an Information System?

■ Definition of Information System– A set of interrelated components which are to collect, process, store, and

distribute information to support decision making and control in an organi-zation

Information System

Information System

1. Information Systems1) Introduction

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What Does an Information System Do?

■ An information system performs three general activities– It accepts data from sources as input– It acts on data to process(produce) information : information generating system– The system outputs the information for the user, manager or staff member

■ Information System Process

Input of dataInput of data Information generatingInformation generating OutputOutput

Third StepFirst Step Second Step

1. Information Systems1) Introduction

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Components of Information System (1/3)

■ Does an Information System Need Computer?

95% 5%

Yes No

As the volume of work grows procedures increase in complexity,

activities become more interrelated,

improvements can be gained by introducing computer as-

sistance

Small size manage-ment

1. Information Systems2) Components of IS

1010 / 13

Components of Information System (2/3)

A set of people, data, procedure to provide useful informa-tion

A set of people, data, procedure to provide useful informa-tion

Information SystemInformation System

People

Data

Procedure

Communication of information

Management of activities

Decision making

1. Information Systems2) Components of IS

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Components of Information System (3/3)

Computer based loan information systems

Computer based loan information systems

Banking database

Economic database

• Fund on deposit • Loan balance • Balance financial plan• Loan portfolio

• Employment data• Economic data

Processor

Information supplied by applicant for loan• Financial status• Loan details• Employment status

1. Information Systems2) Components of IS

■ E.g. Components of a Loan Information System

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Why do we study Information Systems?(1/2) 1. Information Systems3) General role of IS

Collect, distribute, analyze DataCollect, distribute, analyze Data

Get informationGet information

Remove uncertaintyRemove uncertainty

Make a good decisionMake a good decision

Store knowledgeStore knowledge

Why?

Why?

Why?

Why?

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Why do we study Information Systems?(2/2) 1. Information Systems3) General role of IS

Vital component of successful

businesses

Improves efficiency and effectiveness of business processes

Strengthens competitive position in rapidly changing

marketplaces

Facilitates managerial

decision making &

workgroup collaboration

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Benefits and Uses of Information Systems 1. Information Systems3) General role of IS

• Added Value to Products (Goods & Services)• Higher-quality Products

• Improved health care & communications• Reduced labor requirements & costs

• Increased efficiency & productivity• Superior financial decision making,

control over, operations, and managerial decision making

• Fewer errors• Greater accuracy• Better Safety & Service

Product

Labor

Quality

Manage-ment

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Problem Types

Input ProblemStructure

DefiniteOutput

Input ProblemStructure

FuzzyOutput

Input ProblemStructure

User dependentOutput

User

User Interaction

2. Information Systems in Management1) Problem types

Structured Problem

Unstructured Problem

Semi-structured Problem

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What types of Information Systems Exist?

ISRecognition about Infor-

mationThe advent Explanation

TPS(Transaction Pro-cessing System)

Efficiency ComputerTo process data about transac-tions

MIS(Management In-formation System)

Control DatabaseTo enable people to make deci-sion(action)

DSS(Decision Support System)

Decision PC and

Model based

To assist managers with unique strategic decisions that relatively unstructured

ESS(Executive Sup-port System)

Strategic Re-source

Executive Sup-port

To assist top-level executive

ES(Expert System) Knowledge AITo mimic the decision process of a human expert

ERP(Enterprise Re-sources Planning)

Management ITTo integrate management infor-mation across an entire organiza-tion

Work Group Support System

CommunicationCommunica-

tionTo exchange information(ex: EDI, WP)

2. Information Systems in Management2) The relationship between IS and Management

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Evolution of IS

1950 1960 1970 1980 1990 2000~

TPS(Transaction Processing System)

MIS(Management Information System)

DSS(Decision Support System)ESS(Executive Support System)

ES(Expert System)

ERP(Enterprise Resources Plan-ning)WGSS(Work Group Support Sys-tem)

2. Information Systems in Management2) The relationship between IS and Management

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A Business Perspective on Information Systems

Organizations Technology

Management

InformationSystems

2. Information Systems in Management3) The role of IS in Management

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Technical & Behavioral Approaches to MIS

ComputerScience

OperationsResearch

Sociology

PoliticalScience

Psychology

ManagementScience MIS

BehavioralApproaches

Technical Approaches

2. Information Systems in Management3) The role of IS in Management

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Case Study

■ Domestic Case

Click Here

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Reference

■ O’Brien & Marakas, “Introduction to Information Systems – Fifteenth Edition”, McGraw – Hill, Chapter 1, pp. 3~42

■ Euiho Suh, “Introduction to Information Systems (PPT Slide)”, POSMIT Lab. (POSTECH Strategic Management of Information and Technology Laboratory)

■ Euiho Suh, “Information & Management (PPT Slide)”, POSMIT Lab. (POSTECH Strategic Management of Information and Technology Laboratory)