Fundamentals of Information Systems, Seventh Edition

Fundamentals of Information Systems,
Seventh Edition
Chapter 1
An Introduction to
Information Systems in
Organizations

1
Seventh Edition
Introduction
• Information system (IS):
– A set of interrelated components that collect,
manipulate, store, and disseminate data and
information and provide feedback to meet an
objective
• Businesses:
– Can use information systems to increase revenues,
improve customer service and reduce costs

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Seventh Edition
Data, Information, and Knowledge
• Data:
– Raw facts
• Information:
– Collection of facts organized and processed in such a way
that they have value beyond the individual facts
• Process:
– Set of logically related tasks performed to achieve a
defined outcome
• Knowledge:
– Awareness and understanding of a set of information and
the ways information can be made useful
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Seventh Edition
Data, Information, and Knowledge
(continued)

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Seventh Edition
The Value of Information
• Directly linked to how it helps decision makers
achieve their organization’s goals
• Valuable information:
– Can help people and their organizations perform
tasks more efficiently and effectively

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Seventh Edition
What Is an Information System?
• Information system (IS) is a set of interrelated
elements that:
– Collect (input)
– Manipulate (process)
– Store
– Disseminate (output) data and information
– Provide a corrective reaction (feedback
mechanism) to meet an objective

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Seventh Edition
Input, Processing, Output,
Feedback
• Input:
– Activity of gathering and capturing raw data
• Processing:
– Converting data into useful outputs
• Output:
– Producing useful information
• Feedback:
– Information from the system that is used to make
changes to input or processing activities
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Seventh Edition
Computer-Based Information
Systems
• Single set of hardware, software, databases,
telecommunications, people, and procedures:
– That are configured to collect, manipulate, store,
and process data into information
• Technology infrastructure:
– Includes all hardware, software, databases,
telecommunications, people, and procedures
configured to collect, manipulate, store, and
process data into information
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Seventh Edition
Computer-Based Information Systems
(continued)

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Seventh Edition
Systems (continued)
• Hardware:
– Computer equipment used to perform input, processing, storage, and
output activities
• Software:
– Computer programs that govern the operation of the computer
• System software controls basic computer operations
• Application software allows you to accomplish specific tasks
• Database:
– Organized collection of facts and information, typically consisting of
two or more related data files

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Seventh Edition
Systems (continued)
• Telecommunications, networks, and the Internet:
– The electronic transmission of signals for communications
• Networks:
– Connect computers and equipment to enable electronic
communication
• Internet:
– World’s largest computer network, consisting of thousands
of interconnected networks, all freely exchanging
information

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Seventh Edition
Systems (continued)
• Web:
– Network of links on the Internet to documents containing
text, graphics, video, and sound
• Intranet:
– Internal network that allows people within an organization
to exchange information and work on projects
• Extranet:
– Network that allows selected outsiders, such as business
partners and customers, to access authorized resources of
a company’s intranet

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Seventh Edition
Systems (continued)
• People:
– The most important element in most computer-
based information systems
• Procedures:
– Include strategies, policies, methods, and rules for
using the CBIS

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Seventh Edition
Business Information Systems
• Most common types of information systems:
– Those designed for electronic and mobile
commerce, transaction processing, management
information, and decision support
• Some organizations employ:
– Special-purpose systems, such as virtual reality,
that not every organization uses

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Seventh Edition
Business Information Systems
(continued)

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Seventh Edition
Electronic and Mobile Commerce
• E-commerce:
– Any business transaction executed electronically
between:
• Companies (business-to-business, B2B)
• Companies and consumers (business-to-consumer,
B2C)
• Consumers and other consumers (consumer-to-
consumer, C2C)
• Business and the public sector
• Consumers and the public sector
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Seventh Edition
(continued)
• Mobile commerce (m-commerce):
– The use of mobile, wireless devices to place orders
and conduct business
• E-commerce:
– Offers many opportunities for streamlining work
activities
• Electronic business (e-business):
– Uses information systems and the Internet to
perform all business-related tasks and functions
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Seventh Edition
(continued)

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Seventh Edition
Enterprise Systems: Transaction
Processing Systems and Enterprise
Resource Planning
• Transaction:
– Any business-related exchange, such as payments
to employees and sales to customers
• Transaction processing system (TPS):
– Organized collection of people, procedures,
software, databases, and devices used to perform
and record completed business transactions

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Seventh Edition
Enterprise Systems: Transaction
Processing Systems and Enterprise
Resource Planning (continued)
• Enterprise resource planning:
– Set of integrated programs that manages the vital
business operations for an entire multisite, global
organization

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Seventh Edition
Information and Decision Support
Systems
• Management information system (MIS):
– Organized collection of people, procedures,
software, databases, and devices that provides
routine information to managers and decision
makers
– Manufacturing, marketing, production, finance,
and other functional areas are supported by MISs
and are linked through a common database

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Seventh Edition
Information and Decision Support
Systems (continued)

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Seventh Edition
Information and Decision Support Systems
(continued)

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Systems Development
• Systems development:
– The activity of creating or modifying existing
business systems
• Outsourcing:
– Allows a company to focus on what it does best
and delegate other functions to companies with
expertise in systems development
– System development often outsourced

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Seventh Edition
Systems Development (continued)

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Seventh Edition
Organizations and Information Systems
• Organization:
– Formal collection of people and other resources
established to accomplish a set of goals
– Constantly uses money, people, materials,
machines and other equipment, data,
information, and decisions
– Providing value to a stakeholder is the primary
goal of any organization

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Seventh Edition
(continued)
• Value chain:
– Series (chain) of activities that includes inbound
logistics and warehouse and storage, production
and manufacturing, finished product storage,
outbound logistics, marketing and sales, and
customer service

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Seventh Edition
(continued)
• Supply chain management (SCM):
– Determines:
• What supplies are required for value chain
• What quantities are needed to meet customer demand
• How supplies should be processed into finished goods
and services
• How shipment of supplies and products to customers
should be scheduled, monitored, and controlled

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Seventh Edition
(continued)

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Seventh Edition
(continued)
• Customer relationship management (CRM)
programs:
– Help companies manage all aspects of customer
encounters including marketing and advertising,
sales, customer service after the sale, and
programs to retain loyal customers
– CRM software can be purchased as a service and
delivered over the Internet or can be installed on
corporate computers

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Seventh Edition
Organizations and Information
Systems (continued)
• Innovation:
– Organizations continuously improving their
operations by looking for fresh, new ideas
– Can bring cutting-edge products and services that
create new revenue streams
– Can explore new markets and business
approaches
– Some IS departments are creating separate groups
to explore new, innovative ideas
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Seventh Edition
Organizational Culture and Change
• Culture:
– Set of major understandings and assumptions
shared by a group
• Organizational culture:
– Major understandings and assumptions
– May not be formally stated or documented
• Organizational change:
– How organizations plan for, implement, and
handle change
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Seventh Edition
User Satisfaction and Technology
Acceptance
• Technology acceptance model (TAM):
– Specifies the factors that can lead to better
attitudes about the information system, along
with higher acceptance and usage
– Factors include:
• Perceived usefulness
• Ease of use
• Quality
• Degree to which organization supports its use

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Competitive Advantage
• Significant and (ideally) long-term benefit to a
company over its competition
• Can result in higher-quality products, better
customer service, and lower costs
• Organization often uses its information
systems to help gain a competitive advantage

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Seventh Edition
Roles, Functions, and Careers in IS
• Primary responsibilities in information
systems:
– Operations:
• System operators primarily run and maintain IS
equipment
– Systems development:
• Focuses on specific development projects and ongoing
maintenance and review

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Seventh Edition
Roles, Functions, and Careers in IS
• Primary responsibilities in information systems
(continued):
– Support:
• Provides user assistance in hardware and software
acquisition and use, data administration, user training
and assistance, and Web administration
– Information service units:
• A miniature IS department attached and directly
reporting to a functional area in a large organization

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Seventh Edition
Seventh Edition
Chapter 2
Hardware and Software

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Seventh Edition
Why Learn About Hardware and
Software?
• Organizations invest in computer hardware
and software to:
– Improve worker productivity
– Increase revenue, reduce costs
– Provide better customer service
• Managers:
– Are expected to know enough about their
business needs to be able to ask tough questions
of those recommending hardware and software
Fundamentals of Information
38
Systems, Seventh Edition
Hardware Components
• Central processing unit (CPU):
– Arithmetic/logic unit, the control unit, and the
register areas
• Arithmetic/logic unit (ALU):
– Performs mathematical calculations and makes
logical comparisons
• Control unit:
– Sequentially accesses program instructions,
decodes them, and coordinates the flow of data in
and
Fundamentals out of the ALU, registers,
of Information
39
primary storage, and
Hardware Components
(continued)
40
Processing and Memory Devices:
• System unit:
– Houses the components responsible for
processing (the CPU and memory)
• All other computer system devices:
– Are linked either directly or indirectly into the
system unit housing
41
Memory Characteristics and
Functions
• Memory:
– Provides the CPU with a working storage area for
programs and data
– Rapidly provides data and instructions to the CPU
• Storage capacity:
– Eight bits together form a byte (B)
42
Memory Characteristics and Functions
(continued)
43
Secondary Storage and Input and
Output Devices
• Secondary storage:
– Also called permanent storage
– Compared with memory, offers the advantages of
nonvolatility, greater capacity, and greater
economy
– Considerably slower than memory
44
Secondary Storage Devices
• Magnetic tapes:
– Primarily for storing backups of critical data
• Magnetic disks:
– Direct-access storage device
• Redundant array of independent/inexpensive
disks (RAID):
– Method of storing data that generates extra bits of
data from existing data so that if a hard drive fails,
the lost data on that drive can be rebuilt
45
(continued)
• Virtual tape:
– Storage technology for less frequently needed
data
• Storage area network:
– Uses computer servers, distributed storage
devices, and networks to tie everything together
• Optical discs:
– Common form of optical disc on which data
cannot be modified once it has been recorded
46
(continued)
• Digital video disc (DVD):
– Storage medium used to store software, video
games, and movies
• Solid state secondary storage devices:
– Store data in memory chips rather than magnetic
or optical media
– Have few moving parts, so they are less fragile
than hard disk drives
– High cost per GB of data storage
– Lower
Fundamentals capacity compared
of Information
47
to current hard drives
(continued)
• Storage as a Service:
– Data storage service provider rents space to
people and organizations
– Users access their rented storage space via the
Internet
48
Input Devices
• Devices used to input general types of data:
– Personal computer input devices
– Speech recognition technology
– Digital cameras
– Scanning Devices
– Optical data readers
– Magnetic ink character recognition (MICR) devices
– Magnetic stripe card and contactless cards
– Pen input devices
–Seventh
Radio Edition Frequency Identification
Systems,
49
Input Devices (continued)
50
Output Devices
• Display monitors:
– Used to display the output from the computer
– Plasma display:
• Uses thousands of smart cells (pixels) consisting of
electrodes and neon and xenon gases that are
electrically turned into plasma to emit light
– LCD displays:
• Flat displays that use liquid crystals
– Organic light-emitting diodes (OLEDs):
• Use a layer of organic material sandwiched between
two conductors
51
Output Devices (continued)
• Printers and plotters:
– Two main types of printers are laser printers and
inkjet printers
– Plotters are a type of hard-copy output device
used for general design work
• Digital audio player:
– Can store, organize, and play digital music files
– E-books:
– Digital media equivalent of a conventional printed
book
52
Computer System Types
• Computer systems:
– Can range from desktop (or smaller) portable
computers to massive supercomputers that
require housing in large rooms
53
Portable Computers
• Handheld computers:
– Single-user computers that provide ease of
portability because of their small size
• Laptop computer:
– Personal computer designed for use by mobile
users
• Notebook computers:
– Lightweight computer that weighs less than 5
pounds
54
Portable Computers (continued)
• Netbook computer:
– The smallest, lightest, least expensive member of
the laptop computer family
• Tablet computers:
– Portable, lightweight computers with no keyboard
• Smartphone:
– Combines the functionality of a mobile phone,
camera, Web browser, e-mail tool, MP3 player,
and other devices
55
Nonportable Single-User
Computers
• Thin client:
– Low-cost, centrally managed computer with no
extra drives
• Desktop computers:
– Single-user computer systems that are highly
versatile
56
Nonportable Single-User
Computers (continued)
• Nettop computer:
– Inexpensive desktop computer designed to be
smaller, lighter, and consume much less power
than a traditional desktop computer
• Workstations:
– More powerful than personal computers but still
small enough to fit on a desktop
57
Multiple-User Computer Systems
• Server:
– Used by many users to perform a specific task,
such as running network or Internet applications
• Blade server:
– Houses many computer motherboards
– The approach requires much less physical space
than traditional server farms
58
Multiple-User Computer Systems
(continued)
• Mainframe computer:
– Large, powerful computer shared by hundreds of
concurrent users connected to the machine over a
network
• Supercomputers:
– The most powerful computers with the fastest
processing speed and highest performance
59
Overview of Software
• Computer programs:
– Sequences of instructions for the computer
• Documentation:
– Describes program functions to help the user
operate the computer system
• Types of software:
– Systems software
– Application software
60
Systems Software
• Includes:
– Operating systems
– Utility programs
61
Operating Systems
• Set of programs that controls computer
hardware and acts as an interface with
application programs
• Can control one computer or multiple
computers, or
• Can allow multiple users to interact with one
computer
• Combinations of OSs, computers, and users:
– Single computer with a single user
– Single computer with multiple users
62
Operating Systems (continued)
• Activities performed by the operating system:
– Perform common computer hardware functions
– Provide a user interface and input/output
management
– Provide a degree of hardware independence
– Manage system memory
– Manage processing tasks
– Provide networking capability
– Control access to system resources
– Manage
Fundamentals of Information files
63
• Common hardware functions:
– Get input from keyboard or another input device
– Retrieve data from disks
– Store data on disks
– Display information on a monitor or printer
64
• Processing tasks:
– Multitasking:
• More than one program can run at the same time
– Time-sharing:
• Allows more than one person to use a computer system
at the same time
– Scalability:
• Ability of the computer to handle an increasing number
of concurrent users
65
• Networking capability:
– Allows computers in a network to send and
receive data and share computing resources
• Access to system resources and security:
– Protection against unauthorized access
– OS establishes a logon procedure
• File management:
– Ensures that files in secondary storage are
available when needed and that they are
protected
from access66by unauthorized users
Current Operating Systems
• Microsoft PC operating systems:
– Windows XP, Vista, 7, and 8
• Apple computer operating systems:
– Can dual boot – run both Windows and Mac
– Mountain Lion
• Linux:
– Red Hat Linux
– Caldera OpenLinux
• Google
67
Workgroup Operating Systems
• Windows Server:
– Can be used to prevent unauthorized disclosure of
information
• UNIX:
– Can be used on many computer system types and
platforms
• Red Hat Linux:
– Can manage a cluster of up to eight servers
• Mac OS X Server:
– Includes support for 64-bit
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processing
Enterprise Operating Systems
• z/OS:
– IBM’s first 64-bit enterprise OS
• HP-UX:
• Robust UNIX-based OS from Hewlett-Packard
• Supports online transaction processing and Web
applications
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Utility Programs
• Help to perform maintenance or correct
problems with a computer system
• Some can help computer systems run better
and longer without problems
• Can help to secure and safeguard data
70
Middleware
• Software that allows various systems to
communicate and exchange data
• Often developed to address situations where
a company acquires different information
systems through mergers, acquisitions or
expansion
• Use of middleware has evolved into the
service oriented architecture (SOA) approach
to develop systems to allow users to interact
with systems and systems to interact with
71
Application Software
• Application programs:
– Interact with systems software and the systems
software directs computer hardware to perform
necessary tasks
– Help you perform common tasks, such as:
• Creating and formatting text documents
• Performing calculations
• Managing information
• Some applications are more specialized
72
Types and Functions of Application
Software
• Proprietary software:
– One-of-a-kind program for a specific application,
usually developed and owned by a single company
• Off-the-shelf software:
– Existing software program that is purchased
• Application service provider (ASP):
– Company that can provide software, support, and
computer hardware on which to run the software
from the user’s facilities over a network
73
Overview of Application Software
(continued)
• Software as a service (SaaS):
– Allows businesses to subscribe to Web-delivered
business application software by paying a monthly
service charge or a per-use fee
– Can reduce expenses by sharing its running
applications among many businesses
• Cloud computing:
– Use of computing resources, including software
and data storage, on the Internet (the cloud)
rather than on local computers
74
Personal Application Software
• Word processing
• Spreadsheet analysis
• Database applications
• Graphics program
• Personal information managers
• Software suites and integrated software
packages
75
Mobile Application Software
• Number of apps for smartphones and other
mobile devices has exploded
• Tens of thousands of applications have been:
– Developed by third parties and available from the
Apple App Store for the iPhone and from the
Android Market for Android handsets
76
Workgroup Application Software
• Support teamwork, whether people are in the
same location or dispersed around the world
• Also known as collaborative software
• Groupware:
– Software that helps groups of people work
together more effectively
– Examples include group scheduling software,
electronic mail, document sharing software
77
Enterprise Application Software
• Software that benefits an entire organization
• Enterprise resource planning (ERP) software:
– Set of integrated programs that manage a
company’s vital business operations for an entire
multisite, global organization
– Must be able to support many legal entities,
languages, and currencies
78
Application Software for
Information, Decision Support, and
Specialized Purposes
• Available in every industry:
– Specialized application software for information,
decision support, and other purposes
– Examples include:
• Blackboard and other learning management software
• Software to visualize and analyze the human genome
• Decision support software to pick the next hit song
• Companies seeking a competitive advantage
79
Programming Languages
• Sets of keywords, symbols, and a system of
rules for constructing statements:
– By which humans can communicate instructions
to be executed by a computer
• Programming:
– Involves translating what a user wants to
accomplish into instructions that the computer
can understand and execute
80
Software Issues and Trends
• Software bug:
– Defect in a program that keeps it from performing
as it should
• Some tips for reducing impact of software
bugs:
– Register all software
– Check read-me files for workarounds
– Access support area of the manufacturer’s Web
site for patches
– Install
Fundamentals latest software updates
of Information
81
Copyrights and Licenses
• Most software products are protected by law
using copyright or licensing provisions:
– In some cases, you are given unlimited use of
software on one or two computers
– In other cases, you pay for your usage:
• If you use the software more, you pay more
• Some software now requires that you register
or activate it before it can be fully used
82
Software Upgrades
• When software companies stop supporting
older software versions or releases:
– Some customers feel forced to upgrade to the
newer software
• Deciding whether to purchase the newest
software:
– Can be a problem for corporations and people
with a large investment in software
83
Global Software Support
• Supporting local operations:
– One of the biggest challenges IS teams face when
putting together standardized, company-wide
systems
• Trend:
– Outsourcing global support to one or more third-
party distributors
84
Summary
• Hardware:
– The physical components of a computer that
perform the input, processing, storage, and
output activities of the computer
• Green computing:
– Concerned with the efficient and environmentally
responsible design, manufacture, operation, and
disposal of IS-related products
• Software:
– Consists of programs that
85
control the workings of
Summary (continued)
• Operating system (OS):
– Set of computer programs that controls the
computer hardware to support users’ computing
needs
– Manages tasks to allocate computer resources
through multitasking and time-sharing
• Application software:
– Applies the power of the computer to solve
problems and perform specific tasks
86

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