Chapter 1: What Is an Information System?

Dave Bourgeois and David T. Bourgeois

Learning Objectives

Upon successful completion of this chapter, you will be able to:

 define what an information system is by identifying its major components;

 describe the basic history of information systems; and
 describe the basic argument behind the article “Does IT Matter?” by Nicholas Carr.

Please note, there is an updated edition of this book available at https://opentextbook.site. If you
are not required to use this edition for a course, you may want to check it out.

Introduction

If you are reading this, you are most likely taking a course in information systems, but do you
even know what the course is going to cover? When you tell your friends or your family that you
are taking a course in information systems, can you explain what it is about? For the past several
years, I have taught an Introduction to Information Systems course. The first day of class I ask
my students to tell me what they think an information system is. I generally get answers such as
“computers,” “databases,” or “Excel.” These are good answers, but definitely incomplete ones.
The study of information systems goes far beyond understanding some technologies. Let’s begin
our study by defining information systems.

Defining Information Systems

Almost all programs in business require students to take a course in something

called information systems. But what exactly does that term mean? Let’s take a look at some of
the more popular definitions, first from Wikipedia and then from a couple of textbooks:

 “Information systems (IS) is the study of complementary networks of hardware and

software that people and organizations use to collect, filter, process, create, and
distribute data.”[1]
 “Information systems are combinations of hardware, software, and telecommunications
networks that people build and use to collect, create, and distribute useful data, typically
in organizational settings.”[2]

 “Information systems are interrelated components working together to collect, process,

store, and disseminate information to support decision making, coordination, control,
analysis, and viualization in an organization.”[3]
As you can see, these definitions focus on two different ways of describing information systems:
the components that make up an information system and the role that those components play in
an organization. Let’s take a look at each of these.

The Components of Information Systems

As I stated earlier, I spend the first day of my information systems class discussing exactly what
the term means. Many students understand that an information system has something to do with
databases or spreadsheets. Others mention computers and e-commerce. And they are all right, at
least in part: information systems are made up of different components that work together to
provide value to an organization.

The first way I describe information systems to students is to tell them that they are made up of
five components: hardware, software, data, people, and process. The first three, fitting under the
technology category, are generally what most students think of when asked to define information
systems. But the last two, people and process, are really what separate the idea of information
systems from more technical fields, such as computer science. In order to fully understand
information systems, students must understand how all of these components work together to
bring value to an organization.

Technology

Technology can be thought of as the application of scientific knowledge for practical purposes.
From the invention of the wheel to the harnessing of electricity for artificial lighting, technology
is a part of our lives in so many ways that we tend to take it for granted. As discussed before, the
first three components of information systems – hardware, software, and data – all fall under the
category of technology. Each of these will get its own chapter and a much lengthier discussion,
but we will take a moment here to introduce them so we can get a full understanding of what an
information system is.

Hardware

Information systems hardware is the part of an information system you can touch – the physical
components of the technology. Computers, keyboards, disk drives, iPads, and flash drives are all
examples of information systems hardware. We will spend some time going over these
components and how they all work together in chapter 2.

Software
 Software is a set of instructions that tells the hardware what to do.
Software is not tangible – it cannot be touched. When programmers create software programs,
what they are really doing is simply typing out lists of instructions that tell the hardware what to
do. There are several categories of software, with the two main categories being operating-
system software, which makes the hardware usable, and application software, which does
something useful. Examples of operating systems include Microsoft Windows on a personal
computer and Google’s Android on a mobile phone. Examples of application software are
Microsoft Excel and Angry Birds. Software will be explored more thoroughly in chapter 3.

Data

The third component is data. You can think of data as a collection of facts. For example, your
street address, the city you live in, and your phone number are all pieces of data. Like software,
data is also intangible. By themselves, pieces of data are not really very useful. But aggregated,
indexed, and organized together into a database, data can become a powerful tool for businesses.
In fact, all of the definitions presented at the beginning of this chapter focused on how
information systems manage data. Organizations collect all kinds of data and use it to make
decisions. These decisions can then be analyzed as to their effectiveness and the organization can
be improved. Chapter 4 will focus on data and databases, and their uses in organizations.

Networking Communication: A Fourth Technology Piece?

Besides the components of hardware, software, and data, which have long been considered the
core technology of information systems, it has been suggested that one other component should
be added: communication. An information system can exist without the ability to communicate –
the first personal computers were stand-alone machines that did not access the Internet.
However, in today’s hyper-connected world, it is an extremely rare computer that does not
connect to another device or to a network. Technically, the networking communication
component is made up of hardware and software, but it is such a core feature of today’s
information systems that it has become its own category. We will be covering networking in
chapter 5.

People
 When thinking about information systems, it is easy to
get focused on the technology components and forget that we must look beyond these tools to
fully understand how they integrate into an organization. A focus on the people involved in
information systems is the next step. From the front-line help-desk workers, to systems analysts,
to programmers, all the way up to the chief information officer (CIO), the people involved with
information systems are an essential element that must not be overlooked. The people component
will be covered in chapter 9.

Process

The last component of information systems is process. A process is a series of steps undertaken
to achieve a desired outcome or goal. Information systems are becoming more and more
integrated with organizational processes, bringing more productivity and better control to those
processes. But simply automating activities using technology is not enough – businesses looking
to effectively utilize information systems do more. Using technology to manage and improve
processes, both within a company and externally with suppliers and customers, is the ultimate
goal. Technology buzzwords such as “business process reengineering,” “business process
management,” and “enterprise resource planning” all have to do with the continued improvement
of these business procedures and the integration of technology with them. Businesses hoping to
gain an advantage over their competitors are highly focused on this component of information
systems. We will discuss processes in chapter 8.

The Role of Information Systems

Now that we have explored the different components of information systems, we need to turn our
attention to the role that information systems play in an organization. So far we have looked at
what the components of an information system are, but what do these components actually do for
an organization? From our definitions above, we see that these components collect, store,
organize, and distribute data throughout the organization. In fact, we might say that one of the
roles of information systems is to take data and turn it into information, and then transform that
into organizational knowledge. As technology has developed, this role has evolved into the
backbone of the organization. To get a full appreciation of the role information systems play, we
will review how they have changed over the years.
 IBM 704 Mainframe (Copyright: Lawrence
Livermore National Laboratory)

The Mainframe Era

From the late 1950s through the 1960s, computers were seen as a way to more efficiently do
calculations. These first business computers were room-sized monsters, with several refrigerator-
sized machines linked together. The primary work of these devices was to organize and store
large volumes of information that were tedious to manage by hand. Only large businesses,
universities, and government agencies could afford them, and they took a crew of specialized
personnel and specialized facilities to maintain. These devices served dozens to hundreds of
users at a time through a process called time-sharing. Typical functions included scientific
calculations and accounting, under the broader umbrella of “data processing.”

Registered trademark of International Business Machines

In the late 1960s, the Manufacturing Resources Planning (MRP) systems were introduced. This
software, running on a mainframe computer, gave companies the ability to manage the
manufacturing process, making it more efficient. From tracking inventory to creating bills of
materials to scheduling production, the MRP systems (and later the MRP II systems) gave more
businesses a reason to want to integrate computing into their processes. IBM became the
dominant mainframe company. Nicknamed “Big Blue,” the company became synonymous
with business computing. Continued improvement in software and the availability of cheaper
hardware eventually brought mainframe computers (and their little sibling, the minicomputer)
into most large businesses.

The PC Revolution

In 1975, the first microcomputer was announced on the cover of Popular Mechanics: the Altair
8800. Its immediate popularity sparked the imagination of entrepreneurs everywhere, and there
were quickly dozens of companies making these “personal computers.” Though at first just a
niche product for computer hobbyists, improvements in usability and the availability of practical
software led to growing sales. The most prominent of these early personal computer makers was
a little company known as Apple Computer, headed by Steve Jobs and Steve Wozniak, with the
hugely successful “Apple II.” Not wanting to be left out of the revolution, in 1981 IBM (teaming
with a little company called Microsoft for their operating-system software) hurriedly released
their own version of the personal computer, simply called the “PC.” Businesses, who had used
IBM mainframes for years to run their businesses, finally had the permission they needed to
bring personal computers into their companies, and the IBM PC took off. The IBM PC was
named Time magazine’s “Man of the Year” for 1982.

Because of the IBM PC’s open architecture, it was easy for other companies to copy, or “clone”
it. During the 1980s, many new computer companies sprang up, offering less expensive versions
of the PC. This drove prices down and spurred innovation. Microsoft developed its Windows
operating system and made the PC even easier to use. Common uses for the PC during this
period included word processing, spreadsheets, and databases. These early PCs were not
connected to any sort of network; for the most part they stood alone as islands of innovation
within the larger organization.

Client-Server

In the mid-1980s, businesses began to see the need to connect their computers together as a way
to collaborate and share resources. This networking architecture was referred to as “client-
server” because users would log in to the local area network (LAN) from their PC (the “client”)
by connecting to a powerful computer called a “server,” which would then grant them rights to
different resources on the network (such as shared file areas and a printer). Software companies
began developing applications that allowed multiple users to access the same data at the same
time. This evolved into software applications for communicating, with the first real popular use
of electronic mail appearing at this time.

Registered trademark of SAP

This networking and data sharing all stayed within the confines of each business, for the most
part. While there was sharing of electronic data between companies, this was a very specialized
function. Computers were now seen as tools to collaborate internally, within an organization. In
fact, these networks of computers were becoming so powerful that they were replacing many of
the functions previously performed by the larger mainframe computers at a fraction of the cost. It
was during this era that the first Enterprise Resource Planning (ERP) systems were developed
and run on the client-server architecture. An ERP system is a software application with a
centralized database that can be used to run a company’s entire business. With separate modules
for accounting, finance, inventory, human resources, and many, many more, ERP systems,
with Germany’s SAP leading the way, represented the state of the art in information systems
integration. We will discuss ERP systems as part of the chapter on process (chapter 9).

The World Wide Web and E-Commerce

First invented in 1969, the Internet was confined to use by universities, government agencies,
and researchers for many years. Its rather arcane commands and user applications made it
unsuitable for mainstream use in business. One exception to this was the ability to expand
electronic mail outside the confines of a single organization. While the first e-mail messages on
the Internet were sent in the early 1970s, companies who wanted to expand their LAN-based e-
mail started hooking up to the Internet in the 1980s. Companies began connecting their internal
networks to the Internet in order to allow communication between their employees and
employees at other companies. It was with these early Internet connections that the computer
truly began to evolve from a computational device to a communications device.

In 1989, Tim Berners-Lee developed a simpler way for researchers to share information over the
network at CERN laboratories, a concept he called the World Wide Web.[4] This invention
became the launching point of the growth of the Internet as a way for businesses to share
information about themselves. As web browsers and Internet connections became the norm,
companies rushed to grab domain names and create websites.

Registered trademark of Amazon Technologies, Inc.

In 1991, the National Science Foundation, which governed how the Internet was used, lifted
restrictions on its commercial use. The year 1994 saw the establishment of both eBay and
Amazon.com, two true pioneers in the use of the new digital marketplace. A mad rush of
investment in Internet-based businesses led to the dot-com boom through the late 1990s, and
then the dot-com bust in 2000. While much can be learned from the speculation and crazy
economic theories espoused during that bubble, one important outcome for businesses was that
thousands of miles of Internet connections were laid around the world during that time. The
world became truly “wired” heading into the new millenium, ushering in the era of globalization,
which we will discuss in chapter 11.

As it became more expected for companies to be connected to the Internet, the digital world also
became a more dangerous place. Computer viruses and worms, once slowly propagated through
the sharing of computer disks, could now grow with tremendous speed via the Internet. Software
written for a disconnected world found it very difficult to defend against these sorts of threats. A
whole new industry of computer and Internet security arose. We will study information security
in chapter 6.

Web 2.0

As the world recovered from the dot-com bust, the use of technology in business continued to
evolve at a frantic pace. Websites became interactive; instead of just visiting a site to find out
about a business and purchase its products, customers wanted to be able to customize their
experience and interact with the business. This new type of interactive website, where you did
not have to know how to create a web page or do any programming in order to put information
online, became known as web 2.0. Web 2.0 is exemplified by blogging, social networking, and
interactive comments being available on many websites. This new web-2.0 world, in which
online interaction became expected, had a big impact on many businesses and even whole
industries. Some industries, such as bookstores, found themselves relegated to a niche status.
Others, such as video rental chains and travel agencies, simply began going out of business as
they were replaced by online technologies. This process of technology replacing a middleman in
a transaction is called disintermediation.

As the world became more connected, new questions arose. Should access to the Internet be
considered a right? Can I copy a song that I downloaded from the Internet? How can I keep
information that I have put on a website private? What information is acceptable to collect from
children? Technology moved so fast that policymakers did not have enough time to enact
appropriate laws, making for a Wild West–type atmosphere. Ethical issues surrounding
information systems will be covered in chapter 12.

The Post-PC World

After thirty years as the primary computing device used in most businesses, sales of the PC are
now beginning to decline as sales of tablets and smartphones are taking off. Just as the
mainframe before it, the PC will continue to play a key role in business, but will no longer be the
primary way that people interact and do business. The limited storage and processing power of
these devices is being offset by a move to “cloud” computing, which allows for storage, sharing,
and backup of information on a massive scale. This will require new rounds of thinking and
innovation on the part of businesses as technology continues to advance.

The
Eras of Business Computing

Era Hardware Operating System Applications

Mainframe Terminals connected to Time-sharing Custom-written

(1970s) mainframe computer. (TSO) on MVS MRP software

IBM PC or compatible.
PC Sometimes connected to WordPerfect,
MS-DOS
(mid-1980s) mainframe computer via Lotus 1-2-3
expansion card.

Client-Server IBM PC “clone” on a Novell Microsoft

Windows for Workgroups
(late 80s to early 90s) Network. Word, Microsoft

World IBM PC “clone” connected to Microsoft

Windows XP
Wide Web (mid-90s company intranet. Office, Internet E
to early 2000s)

Web 2.0 (mid-2000s Laptop connected to company Microsoft

Windows 7
to present) Wi-Fi. Office, Firefox

Post-PC Mobile-friendly
Apple iPad iOS
(today and beyond) websites, mobile

Can Information Systems Bring Competitive Advantage?

It has always been the assumption that the implementation of information systems will, in and of
itself, bring a business competitive advantage. After all, if installing one computer to manage
inventory can make a company more efficient, won’t installing several computers to handle even
more of the business continue to improve it?

In 2003, Nicholas Carr wrote an article in the Harvard Business Review that questioned this
assumption. The article, entitled “IT Doesn’t Matter,” raised the idea that information technology
has become just a commodity. Instead of viewing technology as an investment that will make a
company stand out, it should be seen as something like electricity: It should be managed to
reduce costs, ensure that it is always running, and be as risk-free as possible.

As you might imagine, this article was both hailed and scorned. Can IT bring a competitive
advantage? It sure did for Walmart (see sidebar). We will discuss this topic further in chapter 7.

Sidebar: Walmart Uses Information Systems to Become the World’s Leading

Retailer

Registered trademark of Wal-Mart Stores, Inc.

Walmart is the world’s largest retailer, earning $15.2 billion on sales of $443.9 billion in the
fiscal year that ended on January 31, 2012. Walmart currently serves over 200 million customers
every week, worldwide.[5] Walmart’s rise to prominence is due in no small part to their use of
information systems.

One of the keys to this success was the implementation of Retail Link, a supply-chain
management system. This system, unique when initially implemented in the mid-1980s, allowed
Walmart’s suppliers to directly access the inventory levels and sales information of their
products at any of Walmart’s more than ten thousand stores. Using Retail Link, suppliers can
analyze how well their products are selling at one or more Walmart stores, with a range of
reporting options. Further, Walmart requires the suppliers to use Retail Link to manage their own
inventory levels. If a supplier feels that their products are selling out too quickly, they can use
Retail Link to petition Walmart to raise the levels of inventory for their products. This has
essentially allowed Walmart to “hire” thousands of product managers, all of whom have a vested
interest in the products they are managing. This revolutionary approach to managing inventory
has allowed Walmart to continue to drive prices down and respond to market forces quickly.

Today, Walmart continues to innovate with information technology. Using its tremendous
market presence, any technology that Walmart requires its suppliers to implement immediately
becomes a business standard.

Summary

In this chapter, you have been introduced to the concept of information systems. We have
reviewed several definitions, with a focus on the components of information systems:
technology, people, and process. We have reviewed how the business use of information systems
has evolved over the years, from the use of large mainframe computers for number crunching,
through the introduction of the PC and networks, all the way to the era of mobile computing.
During each of these phases, new innovations in software and technology allowed businesses to
integrate technology more deeply.

We are now to a point where every company is using information systems and asking the
question: Does it bring a competitive advantage? In the end, that is really what this book is
about. Every businessperson should understand what an information system is and how it can be
used to bring a competitive advantage. And that is the task we have before us.

Study Questions

1. What are the five components that make up an information system?

2. What are three examples of information system hardware?
3. Microsoft Windows is an example of which component of information systems?
4. What is application software?
 5. What roles do people play in information systems?
6. What is the definition of a process?
7. What was invented first, the personal computer or the Internet (ARPANET)?
8. In what year were restrictions on commercial use of the Internet first lifted? When were
eBay and Amazon founded?
9. What does it mean to say we are in a “post-PC world”?
10. What is Carr’s main argument about information technology?

Exercises

1. Suppose that you had to explain to a member of your family or one of your closest
friends the concept of an information system. How would you define it? Write a one-
paragraph description in your own words that you feel would best describe an
information system to your friends or family.
2. Of the five primary components of an information system (hardware, software, data,
people, process), which do you think is the most important to the success of a business
organization? Write a one-paragraph answer to this question that includes an example
from your personal experience to support your answer.
3. We all interact with various information systems every day: at the grocery store, at work,
at school, even in our cars (at least some of us). Make a list of the different information
systems you interact with every day. See if you can identify the technologies, people, and
processes involved in making these systems work.
4. Do you agree that we are in a post-PC stage in the evolution of information systems?
Some people argue that we will always need the personal computer, but that it will not be
the primary device used for manipulating information. Others think that a whole new era
of mobile and biological computing is coming. Do some original research and make your
prediction about what business computing will look like in the next generation.
5. The Walmart case study introduced you to how that company used information systems
to become the world’s leading retailer. Walmart has continued to innovate and is still
looked to as a leader in the use of technology. Do some original research and write a one-
page report detailing a new technology that Walmart has recently implemented or is
pioneering.

https://bus206.pressbooks.com/chapter/chapter-1/
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POSTED BY KASUN | LABELS: SUBJECT 1-1.1 INFORMATION SYSTEMS AND
TECHNOLOGY
1.2 The characteristics of Valuable Information

The value of information depends on their usefulness in the decision making process.
This
value can be judged based on a set of features that can be identified in the information.
They are as follows:

Accurate: Accurate information is error free. Errors could be occurred due to different
reasons. If there is some problem in the knowledge required for the process, output
(information) may have errors. At the same time, if input (data) contains some
errors, the output will not be accurate. This is known as garbage in garbage out
(GIGO). Inaccurate information is not error free.

Complete: Complete information contains all the important facts to make clear
decisions.
For example, an investment report may present all possible benefits and profits
without details of cost that will be required.

Economical: Information should also be relatively economical. Decision makers must

always
balance the value of information with the cost of producing it. For example, if
collecting the data takes lots of resources and time, it is not economical.

Flexible: Flexible information can be used for a variety of purposes. For example,
Information
on how much inventory is on hand for a particular part can be for
- a sales representative to determine the sales plan
- a production manager to identify possible constraints for the production
- a financial executive to calculate the current assets figures of inventory

Reliable: Reliability of information describes the correctness of the information. If there

are
any problems with respect to correctness of data, it will definitely affect the
reliability of information. For example, if the reliability of data collection method is
poor, it will directly affect the information that will be produced.
For example, prediction of prices based on rumors (not past variance information),
is not reliable.

Relevant: The relevance of information is determined based on the usefulness of

information
with respect to the decision making process. For example (E.g.A),, a drop in timber
prices cannot be used to predict the price fluctuation in computers.

Simple: Simplicity in the representation of information is also a very useful feature

utilized to
improve the usability of information in the decision making process. Too many
information could affect the simplicity in the presentation. Therefore it is better to
provide interactive customization to determine simplicity. Providing too many
information is known as information overloading.

Timeliness: Decisions should be made at the right time to achieve effectiveness. Timely
information refers to providing information at the right time. For example, if you can
get to know today’s weather forecast before you leave home, you can decide
whether to bring an umbrella or not.

Verifiable: If it is possible to confirm the reliability of the information about its

correctness
(validate), it becomes verifiable Information. If you are not sure about a particular
information (say foreign news) heard from a radio channel, you can search about it
using Internet.

Accessible: Accurate information plays a major roll in the decision making process of
any
organization. Therefore it is essential to be able to access the Correct/ relevant
information by authorized personnel at the right time to meet their needs.

Secure: the value of information could be lost due to issues such as unauthorized user
access or intentionally damaging its existence. Therefore, it is important to make
steps to protect valuable data and information. For example, use of passwords to
protect data and information.

It is important to note that the values of these quality attributes may vary from one piece
of
information to another. It affects their usefulness in the decision making process. For
example, at the Stock Exchange, information about market forecast may not be very
accurate but if the timeliness is poor, the total value of information will be very poor.

http://learnbitdegree.blogspot.com/2010/05/1_04.html
LEMENTS OF ACOMPUTER SYSTEMHARDWARESOFTWAREPEOPLEWAREDATA

2 HARDWARE: The physical components of a computer system

It refers to the tangible devices that can be seen, touched and feltThe hardware that
makes up the most basic computer system includes the monitor, keyboard and a
system unitPhysical components fall into five categories:Input devicesSystem
unitSecondary storageOutput devicesCommunication devices

3 INPUT DEVICES Mouse Keyboard FIVE CATEGORIES OF HARDWARE:

Translate data and programs that humans can understand into a form that the computer
can process.KeyboardLooks like a typewriter keyboard, but has additional specialized
keys.MouseIs a pointing device that typically rolls on the desktop.It directs the insertion
point or cursor on the display screen.Has one or more buttons for selecting
commandsAlso used for drawing figures.

4 SYSTEM UNIT Central processing Unit (CPU)

Is the electronic circuitry housed within the computer cabinetThe two of the most
important components of the system unit are:Central processing Unit (CPU)Controls
and manipulates data to produce information.A microcomputers CPU is contained on a
single integrated circuit or microprocessor chip.It is like the brain of the computer which
controls the whole computer.It also thinks for the computer with the help of the human
using it.The central processor performs calculations, compares data and produces
results.It has two components: the control unit and arithmetic-logic unit

5 Control Unit:tells the rest of the computer system how to carry out a program’s
instructions.it directs the movement of electronic signals between memory and the
arithmetic logic unitit also directs these control signals between the CPU and input and
output devicesArithmetic-Logic Unitusually called the ALU, performs two types of
operations – arithmetic and logicalArithmetic operations are the fundamental math
operations: addition, subtraction, multiplication and division.Logical operations consist of
comparisons. That is, two pieces of data are compared to see whether one is equal to
(=), less than (<), or greater than (>) the other.

6 Memory ( Primary Storage or Random Access Memory)

Main memory (internal storage)Holds data and program instructions for processing the
data.It holds the processed information before it s output.It is sometimes referred to as
temporary storageIt is located in the system unit on tiny memory chips.

7 Secondary Storage It also holds data and programs permanently.

It supports the main memory.It stores data and programs for future use.This type of
memory stores the information on storage media such as floppy disks and CDsFloppy
disks ( also known as diskettes)widely used to store and transport data from one
computer to another.called as floppy disk because data is stored on a very thin flexible
or floppy plastic diskHard disksare typically used to store programs and very large data
filesHave a much greater capacity and are able to access information much faster than
floppy disks.

8 is relatively new and evolving format

Optical disksUse laser technology and have the greatest capacity.There are two basic
formats or types of optical disks. CD (compact disks) and DVD ( Digital Versatile
Disk)CD (compact disk)used to distribute large databases and reference, to back up
large data source, and to create, store and edit multimedia presentation.DVD ( digital
versatile disk or digital video disk)is relatively new and evolving formatcapacity is far
greater than CDs.can be used for all the things that CDs are used for, plus they are
used to distribute full length motion pictures.

9 OUTPUT DEVICESAre pieces of equipment that translate the processed information

from the CPU into a form that humans can understandMonitor or video display
screenResembles a television screenIt displays the result of different commands given
by the user.It shows how the computer answers the commands and show results of
what you are doingThe output seen in the monitor is called as softcopyPrintera device
that produces printed paper outputit produces images on paper which have created in a
computerthe printed output is called as hardcopy

10 COMMUNICATIONS DEVICE
Sends and receives data and programs from one computer or secondary storage device
to anotherMany microcomputers use a modemModemIs a device which converts the
electronic signals from the computer into electronic signals that can travel over a
telephone line. A modem at the other end of the line then translates the signals for the
receiving computer.

11 SOFTWARE another name for programs

includes the programs which the users use to help them finish their work fast.it includes
instructions that tell the computer how to process datais a set of programs or
procedures associated with the computer system.Two kinds of software:System
SoftwareIs background software that helps a computer manage its internal
resources.are programs designed to directly or indirectly support program
processingConsists of utilities, device drivers, language translators, and operating
systems.deals with the physical complexities of computer hardware.

12 Operating SystemIs a group of computer programs that help your software control
your hardwareDOS or Disk Operating System is one of the most well known OSManage
resources, provide user interface, and run applicationshas three basic
functions:Resources: coordinates all the computer’s resourcesUser Interface: users
interact with application programs and computer hardware through a user
interface.Applications: programs which load and run applications such as word
processors and spreadsheets.
 13 Application SoftwarePerforms useful work on general purpose problems.Designed to
be used by many people to do the most common kinds of tasks.also known as the basic
applicationsThere are two type of application software: Basic application and the
Advanced application

14 Basic Applications:Browsers: used to connect to remote computers, open and

transfer files, display text and images, and provide an interface to the Internet and the
Web.Word Processor: used to create, edit, save, and print text-based
documentsSpreadsheet: used to analyze, organize, manipulate and graph numeric
informationDatabase management system: organize and manage data and
informationPresentation graphics: are use to create professional and exciting
presentations

15 Advanced Applications
Multimedia: integrate video, music, voice, and graphics to create interactive
presentationsWeb publishers: create interactive multimedia Web pagesgraphics
programs: create professional publications, draw, edit, and modify imagesVirtual reality;
create realistic three – dimensional virtual or simulated environmentsArtificial
intelligence: simulated human thought processes and actionsProject managers: plan
projects, schedule, people , and control resources

16 PEOPLEWARE the people involved in the data processing cycle

known as the users or end users -any person who can manipulate and use the
computer system and its programs

17 DATA consists of the raw, unprocessed facts.

There are three types of files:Document files: created by word processors to save
documents such as memos, term papers and letters.Worksheet files: created by
electronic spreadsheets like Excel to analyze things like budgets and to predict
salesDatabase files: typically created by database management programs to contain
highly structured and organized data.

https://slideplayer.com/slide/8655476/

 terial” that the other components work with resides. A database is a place where data is
collected and from which it can be retrieved by querying it using one or more specific
criteria. A data warehouse contains all of the data in whatever form that an organization
 needs. Databases and data warehouses have assumed even greater importance in
information systems with the emergence of “big data,” a term for the truly massive
amounts of data that can be collected and analyzed.

 Human resources and procedures

The final, and possibly most important, component of information systems is the human
element: the people that are needed to run the system and the procedures they follow
so that the knowledge in the huge databases and data warehouses can be turned into
learning that can interpret what has happened in the past and guide future action.

https://www.britannica.com/list/5-components-of-information-systems

Meaning of Business Information System:

Business information systems are sets of inter-related procedures using IT infrastructure in a

business enterprise to generate and disseminate desired information.

Such systems are designed to support decision making by the people associated with the
enterprise in the process of attainment of its objectives.

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The business information system gets data and other resources of IT infrastructure as input
from the environment and process them to satisfy the information needs of different entities
associated with the business enterprise.

Management Information System

There are systems of control over the use of IT resources and the feedback system offers useful
clues for increasing the benefits of information systems to business. The business information
systems are sub-systems of business system and by themselves serve the function of feedback
and control in business system.

Features of Business Information System:

Characteristics & features of business information system are:

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1. The business information systems are subject to the dynamics of business environment and
need to be flexible enough to absorb the inevitable changes in the information needs of
business. They have to be efficient to satisfy the demanding and ‘hard task masters,’ the
business managers. Thus, there is need to balance the conflicting objectives in the process of
designing business information systems.

2. Business information systems need to be proactive. They should anticipate changes in

information needs of users and accordingly adapt themselves to suit their needs. This has
become important because of the fact that the managers get involved in the routine activities
to the extent that the decision making becomes a matter of imitating what competitors are
doing or planning to do, rather than making an informed choice.
3. The purpose of business information system is to cater to the information needs for decision
making in business.

4. The business information systems have to be designed keeping in view the availability of
financial and human resources to the business enterprise.

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5. The cost effectiveness is a matter of prime concern in the development and maintenance of
business information systems. Economic justification for investment in IT infrastructure for
business information systems is a pre condition for its existence and sustenance.

Key Components of Business Information System:

Information systems can be described by four of their key components which are:

1. Decisions

2. Transactions and processing

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3. Information and its flow

4. Individuals or functions involved.

It is difficult to observe the decision process through we can see and review the results of a
decision. Transactions are usually more visible, though many current systems use computer
programs, which are not easy to understand, to process transactions. In principle, an observer
can see information and its flows. Individuals can be observed too, but it is not always easy to
figure out the information processing functions they perform.

http://www.yourarticlelibrary.com/management/information-system/business-information-
system-meaning-features-and-components/70319

Electronic and mobile commerce

1. 1. ELECTRONIC AND MOBILE COMMERCE

2. 2. What is E-Commerce?
3. 3. E-commerce is made possible through the use of Hypertext Markup
Language (HTML), Hypertext Transfer Protocol (HTTP), and server applications
that enable the purchase to take place. Electronic commerce, or e-commerce, is
the buying, selling, marketing, servicing, delivery, and payment of goods and
services over computer networks such as the Internet. E-Commerce
4. 4. Third, e-commerce provides sellers with price elasticity information. This
means that sellers can gauge the demand for a product based on fluctuations in
price. Second, it provides an easy and effective way to acquire pricing
information. Consumers can easily search and compare prices on the Web. 
First, it can eliminate the middleman, or the suppliers and distributors. It enables
consumers to purchase products directly from the manufacturer, thus eliminating
added costs.  E-commerce improves market efficiency through: Purposes:
5. 5. Four Basic Categories Of E-Commerce 1. Business-to-Consumer (B2C) 2.
Business-to-Business (B2B) 3. Consumer-to-Consumer (C2C) 4. E-Government
 6. 6. An electronic storefront is used for customers to select, order, and pay for
products over the Internet. B2C is the sale of merchandise or services between
the supplier and the customer. Business-to-Consumer (B2C)
7. 7. B2B refers to selling merchandise between businesses. Raw material
suppliers sell to manufacturers. Manufacturers sell to distributors. Distributors sell
to retailers.Business-to-Business (B2B)
8. 8. C2C refers to one individual selling a product or service to another individual.
This often occurs through online auctions or clearing houses. Auctions match
buyers and sellers that engage in a competitive bidding processes over the
Internet.Consumer-to-Consumer (C2C)
9. 9. Electronic government, or e-government, is the use of the Internet and e-
commerce to deliver information and public services to citizens, businesses, and
suppliers. E-government is an efficient and effective way to conduct transactions
with citizens and businesses.E-Government
10. 10. Examples:
11. 11. What is M-Commerce?
12. 12. Mobile commerce, or m-commerce, refers to e-commerce conducted in a
wireless environment over the Internet. Buying, selling, marketing, servicing,
delivery and payment of goods and services, are all completed over mobile
technologies such as smart phones, tablets, or other wireless devices.M-
Commerce
13. 13. Bandwidth improvements that increase the speed of data transmission. The
declining cost of wireless technology, the convenience of instant connectivity
from any location,  The widespread availability and popularity of wireless
devices like smart phones,  There are a number of factors driving m-commerce.
These factors includes: Factors:
14. 14. Examples:
15. 15. Reference : http://education-portal.com/academy/lesson/e-commerce- m-
commerce-buying-selling-on-the-web-mobile- devices.html#lesson

https://www.slideshare.net/yhammanansala/electronic-and-mobile-commerce-iii

Business process re-engineering (BPR) is a business management strategy,

originally pioneered in the early 1990s, focusing on the analysis and design
of workflows and business processes within an organization. BPR aimed to
help organizations fundamentally rethink how they do their work in order to
improve customer service, cut operational costs, and become world-class competitors.[1]
 BPR seeks to help companies radically restructure their organizations by focusing on
the ground-up design of their business processes. According to early BPR
proponent Thomas H. Davenport (1990), a business process is a set of logically related
tasks performed to achieve a defined business outcome. Re-engineering emphasized
a holistic focus on business objectives and how processes related to them, encouraging
full-scale recreation of processes rather than iterative optimization of sub-processes.[1]
Business process reengineering is also known as business process redesign, business
transformation, or business process change management.

Contents

 1Overview
 2History
o 2.1Reengineering Work: Don't Automate, Obliterate, 1990
o 2.2Development after 1995
 3Topics
o 3.1The role of information technology
o 3.2Research and methodology
o 3.3Framework
 4Factors for success and failure
o 4.1Organization-wide commitment
o 4.2Team composition
o 4.3Business needs analysis
o 4.4Adequate IT infrastructure
o 4.5Effective change management
o 4.6Ongoing continuous improvement
 5Critique
 6See also
 7References
 8Further reading
 9External links

Overview[edit]
Reengineering guidance and relationship of mission and work processes to information
technology.
Business process reengineering (BPR) is the practice of rethinking and redesigning the
way work is done to better support an organization's mission and reduce costs.
Organizations reengineer two key areas of their businesses. First, they use modern
technology to enhance data dissemination and decision-making processes. Then, they
alter functional organizations to form functional teams.[citation needed] Reengineering starts
with a high-level assessment of the organization's mission, strategic goals,
and customer needs. Basic questions are asked, such as "Does our mission need to be
redefined? Are our strategic goals aligned with our mission? Who are our customers?"
An organization may find that it is operating on questionable assumptions, particularly in
terms of the wants and needs of its customers. Only after the organization rethinks what
it should be doing, it does go on to decide how best to do it.[1]
Within the framework of this basic assessment of mission and goals, re-engineering
focuses on the organization's business processes—the steps and procedures that
govern how resources are used to create products and services that meet the needs of
particular customers or markets. As a structured ordering of work steps across time and
place, a business process can be decomposed into specific activities, measured,
modeled, and improved. It can also be completely redesigned or eliminated altogether.
Re-engineering identifies, analyzes, and re-designs an organization's core business
processes with the aim of achieving improvements in critical performance measures,
such as cost, quality, service, and speed.[1]
Re-engineering recognizes that an organization's business processes are usually
fragmented into sub-processes and tasks that are carried out by several specialized
functional areas within the organization. Often, no one is responsible for the overall
performance of the entire process. Reengineering maintains that optimizing the
performance of sub-processes can result in some benefits, but cannot yield
improvements if the process itself is fundamentally inefficient and outmoded. For that
reason, re-engineering focuses on re-designing the process as a whole in order to
achieve the greatest possible benefits to the organization and their customers. This
drive for realizing improvements by fundamentally re-thinking how the organization's
work should be done distinguishes the re-engineering from process improvement efforts
that focus on functional or incremental improvement.[1]

https://en.wikipedia.org/wiki/Business_process_re-engineering

Careers in Information Systems

Information Systems Job Boards

 Techcrunch's Crunchboard

The field of information systems is expanding and there are career opportunities in
business, government, non-profit organizations, and education. A major in information
systems provides you with a wide range of career opportunities. Career choices range
from very technical positions in network administration or programming to more
communication-oriented employment in training or help desk support. A few of the
possibilities are described below:

Network Administration

Network administrators are responsible for the technical support of an organization’s

network infrastructure. This profession includes such tasks as designing the network
structure, establishing and maintaining servers, designing cabling, validating users,
providing security, and ensuring the ongoing day-to-day operations of the network.

Network Support Personnel

Networks come in many variations and network systems and data communications
analysts analyze, design, test, and evaluate systems such as local area networks
(LAN), wide area networks (WAN), Internet, Intranets, and other data communications
systems. These analysts perform network modeling, analysis and planning; they also
may research related products and make necessary hardware and software
recommendations. Telecommunications specialists focus on the interaction between
computer and communications equipment.

Systems Analysts

Systems analysts identify opportunities for improvement in business processes and

design computer and systems related solutions. Those in this profession help their
clients define technology-related needs and design a system that is most appropriate for
them. They help an organization realize the maximum benefit from its investment in
equipment, personnel, and business processes. This may include planning and
developing new computer systems or devising ways to apply existing systems'
resources to additional operations. Systems analysts are projected by the U.S.
Department of Labor to be one of the top three growth occupations from the years
2000-2010.

Consultants

Many companies, such as Accenture, Deloitte-Touche, IBM and Unisys, provide advice
to their clients that are attempting to use information technology more effectively. These
companies hire information systems majors to serve as consultants for their clients.
Consultants act as systems analysts, programmers, database administrators, and
troubleshooters for their clients. Consultants work on short and long-term projects
frequently reengineering processes or instituting continuous quality improvement
methods.

Computer Programmers

Computer programmers design, write, test, and maintain the detailed instructions, called
programs, that computers must follow to perform their functions. Many technical
innovations in programming—advanced computing technologies and sophisticated new
languages and programming tools—have redefined the role of a programmer and
elevated much of the programming work done today.

Database Support Personnel

With the Internet and electronic business creating tremendous volumes of data, there is
growing need to be able to store, manage, and extract data effectively. Database
administrators work with database management systems software and determine ways
to organize and store data. They set up computer databases and test and coordinate
changes. It is the responsibility of a database administrator to ensure performance,
security, accuracy and integrity of the organization’s database. A data analyst works
with database administrators, systems analysts and programmers to identify the best
method of storing data for an organization. A data analyst is usually responsible for
designing the underlying data structures for an organization. With the volume of
sensitive data generated every second growing rapidly, data integrity, backup, and
keeping databases secure have become an increasingly important aspect for
organizations. Some organizations have created a special position, a data security
specialist to handle the increasingly difficult job of maintaining data security.

Computer Support Specialists

Computer support specialists provide technical assistance, support, and advice to

customers and other users. This group includes technical support specialists and help-
desk technicians. These troubleshooters interpret problems and provide technical
support for hardware, software, and systems. They answer phone calls, analyze
problems using automated diagnostic programs, and resolve recurrent difficulties.
Support specialists may work either within a company that uses computer systems or
directly for a computer hardware or software vendor. Increasingly, these specialists
work for help-desk or support services firms, where they provide computer support on a
contract basis to clients. Computer support specialists and systems administrators are
projected by the U.S. Department of Labor to be among the fastest growing occupations
over the year 2000-2010 period.

Web/Internet Support Specialists

The growth of the Internet and expansion of the World Wide Web, the graphical portion
of the Internet, have generated a variety of occupations related to design, development,
and maintenance of Web sites and their servers. For example, webmasters are
responsible for all technical aspects of a website, including performance issues such as
speed of access, and for approving site content. Internet developers or web developers,
also called web designers, are responsible for day-to-day site design and creation.

Training

Ubiquitous information systems have created a growing need for education about the
most effective use of the technology. Training personnel are needed to help users on a
one-to-one basis, in small groups and in large classroom formats.

Technical Sales and Support

Computer hardware, software and networking vendors such as IBM, Unisys, Hewlett-
Packard, Oracle, Microsoft, and Sun Microsystems required competent sales and
support personnel. Many vendors prefer to hire personnel who understand the
technology and are comfortable selling to technical professionals. This is a high-paying
career option for those people who combine good communication skills, technical
knowledge, with the ability to speak comfortably and easily with others.(Some
information above obtained from the U.S. Department of Labor, Bureau of Labor
Statistics, available at Bureau of Labor Statistics)

https://www.unr.edu/business/academic-disciplines/information-systems/careers-in-is
hree Different Types of Enterprise Systems

by Billie Nordmeyer MBA, MA; Reviewed by Michelle Seidel, B.Sc., LL.B., MBA; Updated January
25, 2019

Three Different Types of Enterprise Systems

Related Articles

What Is an SAP General Ledger?

Types of Information Systems in an Organization

Measure Business Performance With Information Technology

What Are Functional Roles in the Workplace?

Small businesses implement enterprise systems to gain company-wide access to business

knowledge, increase employee productivity and minimize the duplication of company data.
Enterprise systems may also enable a business to reduce the cost of information technology
and minimize the manual input of data. These enterprise system attributes offer particular
benefits, such as the support of teamwork, an improved response to the marketplace,
increased work quality and greater employee collaboration and efficiency.

Tip

Enterprise resource planning, supply chain management and customer relationship

management systems are each examples of enterprise systems.
Enterprise System Overview

Enterprise systems integrate a number of different applications, protocols and formats. In doing
so, an enterprise system allows companies to integrate business processes, such as sales,
deliveries and accounts receivable, by sharing information across business functions and
employee hierarchies. These systems can replace multiple independent systems that may or
may not interact with other systems and that process data to support particular business
functions or processes.

For example, enterprise resource planning supports the entire sales process that includes pre-
sales activities, sales orders, inventory sourcing, deliveries, billing and customer payments.
Enterprise resource planning, supply chain management and customer relationship
management systems are each examples of enterprise systems.

Customer Relationship Management

Customer relationship management systems were developed to address the need to raise a
sales department’s productivity and provide an effective way to increase sales. With CRM
functions, such as sales opportunity management, a company learns more about its customers’
needs and buying behavior and combines this information with market information to enhance
the quality of the company’s marketing plans and sales forecasts.

Other attributes of the CRM system include integration with other systems and accessibility via
mobile devices, allowing employees to update and compare data and to access information
from any client site or other location. Equally importantly, CRM supports mass e-mail
communications and automates the sales process workflow to improve employee productivity.

Supply Chain Management

A supply chain is the collection of people, tasks, equipment, data and other resources required
to produce and move products from a vendor to a customer. Supply chain management refers
to the management of supply chain activities in an effective and efficient way to provide a
company with a strategic advantage.

These activities may include product development, material sourcing, production and logistics
as well as the information systems that coordinate these activities. Information flows allow
supply chain partners to coordinate their strategic and operational plans as well as the day-to-
day flow of goods and materials through the supply chain. The physical flows include the
manufacture, transport and storage of goods or materials.

Enterprise Resource Planning

The enterprise resource planning system integrates software applications, such as purchasing,
finance, human resources and inventory management. Within an ERP system, the integrated
software modules, such as sales, quality management and accounts receivable, communicate
and share data. Each of these modules consists of multiple applications that execute end-to-
end business processes. For example, the sales module includes the applications necessary to
create and manage sales contracts, sales orders, sales invoices and sales order pricing. ERP
applications support not only various operational and administrative tasks, such as the creation
of an account payable or a time sheet, they may also be customized to support a number of
different industries, including oil and gas, retail and banking.

https://smallbusiness.chron.com/three-different-types-enterprise-systems-73267.html

https://studylib.net/doc/5360653/specialized-business-information-systems
 In systems engineering, information systems and software engineering, the systems
development life cycle (SDLC), also referred to as the application development life-
cycle, is a process for planning, creating, testing, and deploying an information
system.[1] The systems development life cycle concept applies to a range of hardware
and software configurations, as a system can be composed of hardware only, software
only, or a combination of both.[2] There are usually six stages in this cycle: requirement
analysis, design, development and testing, implementation, documentation, and
evaluation.

Contents

 1Overview
 2History and details
 3Phases
o 3.1System investigation
o 3.2Analysis
o 3.3Design
o 3.4Environments
o 3.5Testing
o 3.6Training and transition
o 3.7Operations and maintenance
o 3.8Evaluation
 4Systems analysis and design
 5Object-oriented analysis
 6Life cycle
o 6.1Management and control
o 6.2Work breakdown structured organization
o 6.3Baselines
o 6.4Complementary methodologies
 7Strengths and weaknesses
 8System lifecycle
o 8.1Conceptual design
o 8.2Preliminary system design
o 8.3Detail design and development
o 8.4Production and construction
o 8.5Utilization and support
o 8.6Phase-out and disposal
 9See also
 10References
 11Further reading
 12External links

Overview[edit]
A systems development life cycle is composed of a number of clearly defined and
distinct work phases which are used by systems engineers and systems developers to
plan for, design, build, test, and deliver information systems. Like anything that is
manufactured on an assembly line, an SDLC aims to produce high-quality systems that
meet or exceed customer expectations, based on customer requirements, by delivering
systems which move through each clearly defined phase, within scheduled time frames
and cost estimates.[3] Computer systems are complex and often (especially with the
recent rise of service-oriented architecture) link multiple traditional systems potentially
supplied by different software vendors. To manage this level of complexity, a number of
SDLC models or methodologies have been created, such as waterfall, spiral, Agile
software development, rapid prototyping, incremental, and synchronize and stabilize.[4]
SDLC can be described along a spectrum of agile to iterative to sequential
methodologies. Agile methodologies, such as XP and Scrum, focus on lightweight
processes which allow for rapid changes (without necessarily following the pattern of
SDLC approach) along the development cycle. Iterative methodologies, such
as Rational Unified Process and dynamic systems development method, focus on
limited project scope and expanding or improving products by multiple iterations.
Sequential or big-design-up-front (BDUF) models, such as waterfall, focus on complete
and correct planning to guide large projects and risks to successful and predictable
results.[citation needed] Other models, such as anamorphic development, tend to focus on a
form of development that is guided by project scope and adaptive iterations of feature
development.
In project management a project can be defined both with a project life cycle (PLC) and
an SDLC, during which slightly different activities occur. According to Taylor (2004), "the
project life cycle encompasses all the activities of the project, while the systems
development life cycle focuses on realizing the product requirements".[5]
Systems Development Life Cycle (SDLC) is used during the development of an IT
project, it describes the different stages involved in the project from the drawing board,
through the completion of the project.
The SDLC is not a methodology per se, but rather a description of the phases in the life
cycle of a software application. These phases (broadly speaking) are, investigation,
analysis, design, build, test, implement, and maintenance and support. All software
development methodologies (such as the more commonly known waterfall and scrum
methodologies) follow the SDLC phases but the method of doing that varies vastly
between methodologies. In the Scrum methodology, for example, one could say a
single user story goes through all the phases of the SDLC within a single two-week
sprint. Contrast this to the waterfall methodology, as another example, where every
business requirement (recorded in the analysis phase of the SDLC in a document called
the Business Requirements Specification) is translated into feature/functional
descriptions (recorded in the design phase in a document called the Functional
Specification) which are then all built in one go as a collection of solution features
typically over a period of three to nine months, or more. These methodologies are
obviously quite different approaches, yet they both contain the SDLC phases in which a
requirement is born, then travels through the life cycle phases ending in the final phase
of maintenance and support, after-which (typically) the whole life cycle starts again for a
subsequent version of the software application.

History and details[edit]

The product life cycle describes the process for building information systems in a very
deliberate, structured and methodical way, reiterating each stage of the product's life.
The systems development life cycle, according to Elliott & Strachan & Radford (2004),
"originated in the 1960s, to develop large scale functional business systems in an age of
large scale business conglomerates. Information systems activities revolved around
heavy data processing and number crunching routines".[6]
Several systems development frameworks have been partly based on SDLC, such as
the structured systems analysis and design method (SSADM) produced for the UK
government Office of Government Commerce in the 1980s. Ever since, according to
Elliott (2004), "the traditional life cycle approaches to systems development have been
increasingly replaced with alternative approaches and frameworks, which attempted to
overcome some of the inherent deficiencies of the traditional SDLC".[6]

Phases[edit]
The system development life cycle framework provides a sequence of activities for
system designers and developers to follow. It consists of a set of steps or phases in
which each phase of the SDLC uses the results of the previous one.[7][8]
The SDLC adheres to important phases that are essential for developers—such
as planning, analysis, design, and implementation—and are explained in the section
below. This includes evaluation of the currently used system, information gathering,
feasibility studies, and request approval. A number of SDLC models have been created,
including waterfall, fountain, spiral, build and fix, rapid prototyping, incremental,
synchronize, and stabilize.[9][10] The oldest of these, and the best known, is the waterfall
model, a sequence of stages in which the output of each stage becomes the input for
the next.[8] These stages can be characterized and divided up in different ways,
including the following:[7][8][11][12]
A ten-phase version of the systems development life cycle[7]

 Preliminary analysis: Begin with a preliminary analysis, propose alternative

solutions, describe costs and benefits, and submit a preliminary plan with
recommendations.

1. Conduct the preliminary analysis: Discover the organization's objectives

and the nature and scope of the problem under study. Even if a problem
refers only to a small segment of the organization itself, find out what the
objectives of the organization itself are. Then see how the problem being
studied fits in with them.
2. Propose alternative solutions: After digging into the organization's
objectives and specific problems, several solutions may have been
discovered. However, alternate proposals may still come from
interviewing employees, clients, suppliers, and/or consultants. Insight may
also be gained by researching what competitors are doing.
3. Cost benefit analysis: Analyze and describe the costs and benefits of
implementing the proposed changes. In the end, the ultimate decision on
whether to leave the system as is, improve it, or develop a new system
will be guided by this and the rest of the preliminary analysis data.
 Systems analysis, requirements definition: Define project goals into defined
functions and operations of the intended application. This involves the process of
gathering and interpreting facts, diagnosing problems, and recommending
improvements to the system. Project goals will be further aided by analysis of
end-user information needs and the removal of any inconsistencies and
incompleteness in these requirements.
A series of steps followed by the developer include:[13]

1. Collection of facts: Obtain end user requirements through documentation,

client interviews, observation, and questionnaires.
2. Scrutiny of the existing system: Identify pros and cons of the current
system in-place, so as to carry forward the pros and avoid the cons in the
new system.
3. Analysis of the proposed system: Find solutions to the shortcomings
described in step two and prepare the specifications using any specific
user proposals.

 Systems design: At this step, desired features and operations are described
in detail, including screen layouts, business rules, process
diagrams, pseudocode, and other documentation.
 Development: The real code is written here.
 Integration and testing: All the modules are brought together into a special
testing environment, then checked for errors, bugs, and interoperability.
 Acceptance, installation, deployment: This is the final stage of initial
development, where the software is put into production and runs actual
business.
 Maintenance: During the maintenance stage of the SDLC, the system is
assessed/evaluated to ensure it does not become obsolete. This is also
where changes are made to initial software.
 Evaluation: Some companies do not view this as an official stage of the
SDLC, while others consider it to be an extension of the maintenance stage,
and may be referred to in some circles as post-implementation review. This
is where the system that was developed, as well as the entire process, is
evaluated. Some of the questions that need to be answered include if the
newly implemented system meets the initial business requirements and
objectives, if the system is reliable and fault-tolerant, and if it functions
according to the approved functional requirements. In addition to evaluating
the software that was released, it is important to assess the effectiveness of
the development process. If there are any aspects of the entire process (or
certain stages) that management is not satisfied with, this is the time to
improve.
 Disposal: In this phase, plans are developed for discontinuing the use of
system information, hardware, and software and making the transition to a
new system. The purpose here is to properly move, archive, discard, or
destroy information, hardware, and software that is being replaced, in a
manner that prevents any possibility of unauthorized disclosure of sensitive
 data. The disposal activities ensure proper migration to a new system.
Particular emphasis is given to proper preservation and archiving of data
processed by the previous system. All of this should be done in accordance
with the organization's security requirements.[14]
In the following diagram, these stages of the systems development life cycle are
divided in ten steps, from definition to creation and modification of IT work
products:
Not every project will require that the phases be sequentially executed. However,
the phases are interdependent. Depending upon the size and complexity of the
project, phases may be combined or may overlap.[7]
System investigation[edit]
First the IT system proposal is investigated. During this step, consider all current
priorities that would be affected and how they should be handled. Before any
system planning is done, a feasibility study should be conducted to determine if
creating a new or improved system is a viable solution. This will help to
determine the costs, benefits, resource requirements, and specific user needs
required for completion. The development process can only continue once
management approves of the recommendations from the feasibility study.[15]
The following represent different components of the feasibility study:

 Operational feasibility
 Financial feasibility
 Technical feasibility
 Human factors feasibility
 Legal/Political feasibility
Analysis[edit]
The goal of analysis is to determine where the problem is, in an attempt to fix the
system. This step involves breaking down the system in different pieces to
analyze the situation, analyzing project goals, breaking down what needs to be
created, and attempting to engage users so that definite requirements can be
defined.
Design[edit]
In systems design, the design functions and operations are described in detail,
including screen layouts, business rules, process diagrams, and other
documentation. The output of this stage will describe the new system as a
collection of modules or subsystems.
The design stage takes as its initial input the requirements identified in the
approved requirements document. For each requirement, a set of one or more
design elements will be produced as a result of interviews, workshops, and/or
prototype efforts.
Design elements describe the desired system features in detail, and they
generally include functional hierarchy diagrams, screen layout diagrams, tables
of business rules, business process diagrams, pseudo-code, and a complete
entity-relationship diagram with a full data dictionary. These design elements are
intended to describe the system in sufficient detail, such that skilled developers
and engineers may develop and deliver the system with minimal additional input
design.
Environments[edit]
Environments are controlled areas where systems developers can build,
distribute, install, configure, test, and execute systems that move through the
SDLC. Each environment is aligned with different areas of the SDLC and is
intended to have specific purposes. Examples of such environments include the:

 development environment, where developers can work independently of

each other before trying to merge their work with the work of others;
 common build environment, where merged work can be built, together, as a
combined system;
 systems integration testing environment, where basic testing of a system's
integration points to other upstream or downstream systems can be tested;
 user acceptance testing environment, where business stakeholders can test
against their original business requirements; and
 production environment, where systems finally get deployed for final use by
their intended end users.
Testing[edit]
The code is tested at various levels in software testing. Unit, system, and user
acceptance testings are often performed. This is a grey area as many different
opinions exist as to what the stages of testing are and how much, if any iteration
occurs. Iteration is not generally part of the waterfall model, but the means to
rectify defects and validate fixes prior to deployment is incorporated into this
phase.
The following are types of testing that may be relevant, depending on the type of
system under development:

 Defect testing the failed scenarios, including

 Path testing
 Data set testing
 Unit testing
 System testing
 Integration testing
 Black-box testing
 White-box testing
 Regression testing
 Automation testing
 User acceptance testing
 Software performance testing
Training and transition[edit]
Once a system has been stabilized through adequate testing, the SDLC ensures
that proper training on the system is performed or documented before
transitioning the system to its support staff and end users. Training usually
covers operational training for those people who will be responsible for
supporting the system as well as training for those end users who will be using
the system after its delivery to a production operating environment.
After training has been successfully completed, systems engineers and
developers transition the system to its final production environment, where it is
intended to be used by its end users and supported by its support and
operations staff.
Operations and maintenance[edit]
The deployment of the system includes changes and enhancements before the
decommissioning or sunset of the system. Maintaining the system is an
important aspect of SDLC. As key personnel change positions in the
organization, new changes will be implemented. There are two approaches to
system development: the traditional approach (structured) and object oriented.
Information engineering includes the traditional system approach, which is also
called the structured analysis and design technique. The object oriented
approach views information system as a collection of objects that are integrated
with each other to make a full and complete information system.
Evaluation[edit]
The final phase of the SDLC is to measure the effectiveness of the system and
evaluate potential enhancements.

Systems analysis and design[edit]

The systems analysis and design (SAD) is the process of developing
information systems (IS) that effectively use hardware, software, data,
processes, and people to support the company's businesses objectives. System
analysis and design can be considered the meta-development activity, which
serves to set the stage and bound the problem. SAD can be leveraged to set the
correct balance among competing high-level requirements in the functional and
non-functional analysis domains. System analysis and design interacts strongly
with distributed enterprise architecture, enterprise I.T. Architecture, and business
architecture, and relies heavily on concepts such as partitioning, interfaces,
personae and roles, and deployment/operational modeling to arrive at a high-
level system description. This high level description is then further broken down
into the components and modules which can be analyzed, designed, and
constructed separately and integrated to accomplish the business goal. SDLC
and SAD are cornerstones of full life cycle product and system planning.
Object-oriented analysis[edit]
Object-oriented analysis (OOA) is the process of analyzing a task (also known
as a problem domain), to develop a conceptual model that can then be used to
complete the task. A typical OOA model would describe computer software that
could be used to satisfy a set of customer-defined requirements. During the
analysis phase of problem-solving, a programmer might consider a written
requirements statement, a formal vision document, or interviews with
stakeholders or other interested parties. The task to be addressed might be
divided into several subtasks (or domains), each representing a different
business, technological, or other areas of interest. Each subtask would be
analyzed separately. Implementation constraints,
(e.g., concurrency, distribution, persistence, or how the system is to be built) are
not considered during the analysis phase; rather, they are addressed during
object-oriented design (OOD).
The conceptual model that results from OOA will typically consist of a set of use
cases, one or more UML class diagrams, and a number of interaction diagrams.
It may also include some kind of user interface mock-up.
The input for object-oriented design is provided by the output of object-oriented
analysis. Realize that an output artifact does not need to be completely
developed to serve as input of object-oriented design; analysis and design may
occur in parallel, and in practice the results of one activity can feed the other in a
short feedback cycle through an iterative process. Both analysis and design can
be performed incrementally, and the artifacts can be continuously grown instead
of completely developed in one shot.
Some typical (but common to all types of design analysis) input artifacts for
object-oriented:

 Conceptual model: Conceptual model is the result of object-oriented

analysis, it captures concepts in the problem domain. The conceptual model
is explicitly chosen to be independent of implementation details, such as
concurrency or data storage.
 Use case: Use case is a description of sequences of events that, taken
together, lead to a system doing something useful. Each use case provides
one or more scenarios that convey how the system should interact with the
users called actors to achieve a specific business goal or function. Use case
actors may be end users or other systems. In many circumstances use cases
are further elaborated into use case diagrams. Use case diagrams are used
to identify the actor (users or other systems) and the processes they perform.
 System Sequence Diagram: System Sequence diagram (SSD) is a picture
that shows, for a particular scenario of a use case, the events that external
actors generate, their order, and possible inter-system events.
 User interface documentations (if applicable): Document that shows and
describes the look and feel of the end product's user interface. It is not
 mandatory to have this, but it helps to visualize the end-product and
therefore helps the designer.
 Relational data model (if applicable): A data model is an abstract model that
describes how data is represented and used. If an object database is not
used, the relational data model should usually be created before the design,
since the strategy chosen for object-relational mapping is an output of the
OO design process. However, it is possible to develop the relational data
model and the object-oriented design artifacts in parallel, and the growth of
an artifact can stimulate the refinement of other artifacts.

Life cycle

https://en.wikipedia.org/wiki/Systems_development_life_cycle

Chapter 12

Information Systems for Business Functions

12.1 Supporting Business Functions in an Enterprise with Information

The principal business functions in a business firm are:

1. Marketing and sales

2. Production

3. Accounting and finance

4. Human resources

Figure 12.1: Outlines a general view of information systems supporting a company's operations
and management. Emphasize that management support systems (MRS), decision support systems
(DSS), and executive information systems (EIS), rest on the foundation of transaction processing
systems (TPS) that support business operations. TPSs are the major source of data used by the
higher-level systems to derive information. Professional support systems (PSS) and office
information systems (OIS), which support individual and group knowledge work, are also a part
of this foundation.
12.2 Marketing Information Systems [Figure 12.2 & Figure 12.3]

Marketing activities are directed toward planning, promoting, and selling goods and services to
satisfy the needs of customers and the objectives of the organization.

Marketing information systems support decision making regarding the marketing mix. These
include:

1. Product

2. Price

3. Place

4. Promotion

Figure 12.3 illustrates the structure of the entire marketing information system. In order to
support decision making on the marketing mix, a marketing information system draws on several
sources of data and information.

Sources of Data and Information for Marketing: Boundary-Spanning and Transaction

Processing Subsystems

A marketing information system relies on external information to a far greater degree than other
organizational information systems. It includes two subsystems designed for boundary spanning
- bringing into the firm data and information about the marketplace.

The objective of marketing research is to collect data on the actual customers and the potential
customers, known as prospects. The identification of the needs of the customer is a fundamental
starting point for total quality management (TQM). Electronic commerce on the WEB makes it
easy to compile statistics on actual buyer behaviour.

Marketing research software supports statistical analysis of data. It enables the firm to correlate
buyer behaviour with very detailed geographic variables, demographic variables, and
psychographic variables.

Marketing (competitive) intelligence is responsible for the gathering and interpretation of data
regarding the firm's competitors, and for the dissemination of the competitive information to the
appropriate users. Most of the competitor information comes from corporate annual reports,
media-tracking services, and from reports purchased from external providers, including on-line
database services. The Internet has become a major source of competitive intelligence.

Marketing Mix Subsystems

The marketing mix subsystems support decision making regarding product introduction, pricing,
promotion (advertising and personal selling), and distribution. These decisions are integrated into
the sales forecast and marketing plans against which the ongoing sales results are compared.

Marketing mix subsystems include:

1. Product subsystem

2. Place subsystem

3. Promotion subsystem

4. Price subsystem

5. Sales forecasting

Product Subsystem

The product subsystem helps to plan the introduction of new products. Continually bringing new
products to market is vital in today's competitive environment of rapid change. The product
subsystem should support balancing the degree of risk in the overall new-product portfolio, with
more aggressive competitors assuming higher degrees of risk for a potentially higher payoff.

Although decisions regarding the introduction of new products are unstructured, information
systems support this process in several ways:

1. Professional support systems assist designers in their knowledge work

2. DSSs are used to evaluate proposed new products

3. With a DSS, a marketing manager can score the desirability of a new product.

4. Electronic meeting systems help bring the expertise of people dispersed in space and time to
bear on the problem

5. Information derived from marketing intelligence and research is vital in evaluating new
product ideas.

Place Subsystem

The place subsystem assists the decision makers in making the product available to the customer
at the right place at the right time. The place subsystem helps plan the distribution channels for
the product and track their performance.

The use of information technology has dramatically increased the availability of information on
product movement in the distribution channel. Examples include:
1. Bar-coded Universal Product Code (UPC)

2. Point-of-sale (POS) scanning

3. Electronic data interchange (EDI)

4. Supports just-in-time product delivery and customized delivery

Promotion Subsystem

The promotion subsystem is often the most elaborate in the marketing information system, since
it supports both personal selling and advertising. Media selection packages assist in selecting a
mix of avenues to persuade the potential purchaser, including direct mail, television, print media,
and the electronic media such as the Internet and the WEB in particular. The effectiveness of the
selected media mix is monitored and its composition is continually adjusted.

Database marketing relies on the accumulation and use of extensive databases to segment
potential customers and reach tem with personalized promotional information.

The role of telemarketing, marketing over the telephone, has increased. Telemarketing calls are
well supported by information technology.

Sales management is thoroughly supported with information technology. Customer profitability

analysis help identify high-profit and high-growth customers and target marketing efforts in
order to retain and develop these accounts.

Sales force automation, involves equipping salespeople with portable computers tied into the
corporate information systems. This gives the salespeople instantaneous access to information
and frees them from the reporting paperwork. This increases selling time and the level of
performance. Access to corporate databases is sometimes accompanied by access to corporate
expertise, either by being able to contact the experts or by using expert systems that help specify
the product meeting customer requirements.

Price Subsystem

Pricing decisions find a degree of support from DSSs and access to databases that contain
industry prices. These highly unstructured decisions are made in pursuit of the companys pricing
objectives. General strategies range from profit maximization to forgoing a part of the profit in
order to increase a market share.

Information systems provide an opportunity to finely segment customer groups, and charge
different prices depending on the combination of products and services provided, as well as the
circumstances of the sale transaction.

Sales Forecasting
Based on the planned marketing mix and outstanding orders, sales are forecast and a full
marketing plan is developed. Sale forecasting is an area where any quantitative methods
employed must be tempered with human insight and experience. The actual sales will depend to
a large degree on the dynamics of the environment.

Qualitative techniques are generally used for environmental forecasting - an attempt to predict
the social, economic, legal, and technological environment in which the company will try to
realize its plans. Sales forecasting uses numerous techniques, which include:

1. Group decision making techniques are used to elicit broad expert opinion

2. Scenario analysis in which each scenario in this process is a plausible future environment

3. Extrapolation of trends and cycles through a time-series analysis.

12.3 Manufacturing Information Systems

Global competitive pressures of the information society have been highly pronounced in
manufacturing and have radically changed it. The new marketplace calls for manufacturing that
are:

1. Lean - highly efficient, using fewer input resources in production through better engineering
and through production processes that rely on low inventories and result in less waste.

2. Agile - fit for time-based competition. Both the new product design and order fulfilment are
drastically shortened.

3. Flexible - able to adjust the product to a customer's preferences rapidly and cost effectively.

4. Managed for quality - by measuring quality throughout the production process and following
world standards, manufacturers treat quality as a necessity and not a high-price option.

Structure of Manufacturing Information Systems [Figure 12.5]

Information technology must play a vital role in the design and manufacturing processes.
Manufacturing information systems are among the most difficult both to develop and to
implement.

TPSs are embedded in the production process or in other company processes. The data provided
by the transaction processing systems are used by management support subsystems, which are
tightly integrated and interdependent.

Manufacturing information subsystems include:

1. Product design and engineering

2. Product scheduling

3. Quality control

4. Facilities planning, production costing, logistics and inventory subsystems

Product Design and Engineering

Product design and engineering are widely supported today by computer-aided design (CAD)
and computer-aided engineering (CAE) systems. CAD systems assist the designer with
automatic calculations and display of surfaces while storing the design information in databases.
The produced designs are subject to processing with CAE systems to ensure their quality, safety,
manufacturability, and cost-effectiveness. CAD/CAE systems increasingly eliminate paperwork
from the design process, while speeding up the process itself. As well, the combined techniques
of CAD/CAE and rapid prototyping cut time to market.

Product Scheduling

Production scheduling is the heart of the manufacturing information system. This complex
subsystem has to ensure that an appropriate combination of human, machinery, and material
resources will be provided at an appropriate time in order to manufacture the goods.

Production scheduling and the ancillary processes are today frequently controlled with
a manufacturing resource planning system as the main informational tool. This elaborate
software converts the sales forecast for the plants products into a detailed production plan and
further into a master schedule of production.

Computer integrated manufacturing (CIM) is a strategy through which a manufacturer takes

control of the entire manufacturing process. The process starts with CAD and CAE and
continues on the factory floor where robots and numerically controlled machinery are installed -
and thus computer-aided manufacturing (CAM) is implemented. A manufacturing system based
on this concept can turn out very small batches of a particular product as cost-effectively as a
traditional production line can turn out millions of identical products. A full-fledged CIM is
extremely difficult to implement; indeed, many firms have failed in their attempts to do so.

Quality Control

The quality control subsystem of a manufacturing information system relies on the data collected
on the shop floor by the sensors embedded in the process control systems.

Total quality management (TQM) is a management technique for continuously improving the
performance of all members and units of a firm to ensure customer satisfaction. In particular, the
principles of TQM state that quality comes from improving the design and manufacturing
process, rather than Ainspecting out@ defective products. The foundation of quality is also
understanding and reducing variation in the overall manufacturing process.
Facilities Planning, Production Costing, Logistics and Inventory Subsystems

Among the higher-level decision making supported by manufacturing information systems are
facilities planning - locating the sites for manufacturing plants, deciding on their production
capacities, and laying out the plant floors.

Manufacturing management requires a cost control program, relying on the information systems.
Among the informational outputs of the production costing subsystem are labor and equipment
productivity reports, performance of plants as cost centers, and schedules for equipment
maintenance and replacement.

Managing the raw-materials, packaging, and the work in progress inventory is a responsibility of
the manufacturing function. In some cases, inventory management is combined with the general
logistics systems, which plan and control the arrival of purchased goods into the firm as well as
shipments to the customers.

12.4 Accounting and Financial Information Systems [Figure 12.9]

The financial function of the enterprise consists in taking stock of the flows of money and other
assets into and out of an organization, ensuring that its available resources are properly used and
that the organization is financially fit. The components of the accounting system include:

1. Accounts receivable records

2. Accounts payable records

3. Payroll records

4. Inventory control records

5. General ledgers

Financial information systems rely on external sources, such as on-line databases and custom
produced reports, particularly in the areas of financial forecasting and funds management. The
essential functions that financial information systems perform include:

1. Financial forecasting and planning

2. Financial control

3. Funds management

4. Internal auditing

Financial Forecasting
Financial forecasting is the process of predicting the inflows of funds into the company and the
outflows of funds from it for a long term into the future. Outflows of funds must be balanced
over the long term with the inflows. With the globalization of business, the function of financial
forecasting has become more complex, since the activities in multiple national markets have to
be consolidated, taking into consideration the vagaries of multiple national currencies. Scenario
analysis is frequently employed in order to prepare the firm for various contingencies.

Financial forecasts are based on computerized models known as cash-flow models. They range
from rather simple spreadsheet templates to sophisticated models developed for the given
industry and customized for the firm or, in the case of large corporations to specify modeling of
their financial operations. Financial forecasting serves to identify the need for funds and their
sources.

Financial Control

The primary tools of financial control are budgets. A budget specifies the resources committed to
a plan for a given project or time period. Fixed budgets are independent of the level of activity of
the unit for which the budget is drawn up. Flexible budgets commit resources depending on the
level of activity.

Spreadsheet programs are the main budgeting tools. Spreadsheets are the personal productivity
tools in use today in budget preparation.

In the systems-theoretic view, budgets serve as the standard against which managers can
compare the actual results by using information systems. Performance reports are used to
monitor budgets of various managerial levels. A performance report states the actual financial
results achieved by the unit and compares them with the planned results.

Along with budgets and performance reports, financial control employs a number of financial
ratios indicating the performance of the business unit. A widely employed financial ratio
is return on investment (ROI). ROS shows how well a business unit uses its resources. Its value
is obtained by dividing the earnings of the business unit by its total assets.

Funds Management

Financial information systems help to manage the organization's liquid assets, such as cash or
securities, for high yields with the lowest degree of loss risk. Some firms deploy computerized
systems to manage their securities portfolios and automatically generate buy or sell orders.

Internal Auditing

The audit function provides an independent appraisal of an organization's accounting, financial,

and operational procedures and information. All large firms have internal auditors, answerable
only to the audit committee of the board of directors. The staff of the chief financial officer of
the company performs financial and operational audits. During a financial audit, an appraisal is
made of the reliability and integrity of the company's financial information and of the means
used to process it. An operational audit is an appraisal of how well management utilizes
company resources and how well corporate plans are being carried out.

12.5 Human Resource Information Systems

A human resource information system (HRIS) supports the human resources function of an
organization with information. The name of this function reflects the recognition that people who
work in a firm are frequently its most valuable resources. The complexity of human resource
management has grown immensely over recent years, primary due to the need to conform with
new laws and regulations.

A HRIS has to ensure the appropriate degree of access to a great variety of internal stakeholders,
including:

1. The employees of the Human Resources department in performance of their duties

2. All the employees of the firm wishing ti inspect their own records

3. All the employees of the firm seeking information regarding open positions or available
benefit plans

4. Employees availing themselves of the computer-assisted training and evaluation opportunities

5. Managers throughout the firm in the process of evaluating their subordinates and making
personnel decisions

6. Corporate executives involved in tactical and strategic planning and control

Transaction Processing Subsystems and Databases of Human Resource Information

Systems

At the heart of HRIS are its databases, which are in some cases integrated into a single human
resource database. The record of each employee in a sophisticated employee database may
contain 150 to 200 data items, including the personal data, educational history and skills,
occupational background, and the history of occupied positions, salary, and performance in the
firm. Richer multimedia databases are not assembled by some firms in order to facilitate fast
formation of compatible teams of people with complementary skills.

Other HRIS databases include:

1. Applicant databases

2. Position inventory

3. Skills inventory
4. Benefit databases

5. External databases

Information Subsystems for Human Resource Management

The information subsystems of HRIS reflect the flow of human resources through the firm, from
planning and recruitment to termination. A sophisticated HRIS includes the following
subsystems:

1. Human resource planning

2. Recruiting and workforce management

3. Compensation and benefits

4. Government reporting and labour relations support

Human Resource Planning

To identify the human resources necessary to accomplish the long-term objectives of a firm, we
need to project the skills, knowledge, and experience of the future employees.

Recruiting and Workforce Management

Based on the long-term resource plan, a recruitment plan is developed. The plan lists the
currently unfilled positions and those expected to become vacant due to turnover.

The life-cycle transitions of the firm's workforce - hiring, promotion and transfer, and
termination - have to be supported with the appropriate information system components.

Compensation and Benefits

Two principal external stakeholders have an abiding interest in the human resource policies of
organizations. These are:

1. Various levels of government

2. Labor unions

12.6 Integrating Functional Systems for Superior Organizational Performance

Functional information systems rarely stand alone. This reflects the fact that the functions they
support should, as much as possible, connect with each other seamlessly in order to serve the
firms customers. Customers expect timely order delivery, often on a just-in-time schedule;
quality inspection to their own standards; flexible credit terms; post-delivery service; and often,
participation in the product design process.

Information technology provides vital support for integrating internal business processes, cutting
across functional lines, and for integrating operations with the firm's business partners, its
customers and suppliers.

http://www.umsl.edu/~joshik/msis480/chapt12.htm

A continual improvement process, also often called a continuous improvement

process (abbreviated as CIP or CI), is an ongoing effort to improve products, services,
or processes.[1] These efforts can seek "incremental" improvement over time or
"breakthrough" improvement all at once.[2] Delivery (customer valued) processes are
constantly evaluated and improved in the light of their efficiency, effectiveness and
flexibility.
Some see CIPs as a meta-process for most management systems (such as business
process management, quality management, project management, and program
management).[3] W. Edwards Deming, a pioneer of the field, saw it as part of the
'system' whereby feedback from the process and customer were evaluated against
organisational goals. The fact that it can be called a management process does not
mean that it needs to be executed by 'management'; but rather merely that it makes
decisions about the implementation of the delivery process and the design of the
delivery process itself.[4]
A broader definition is that of the Institute of Quality Assurance who defined "continuous
improvement as a gradual never-ending change which is: '... focused on increasing the
effectiveness and/or efficiency of an organisation to fulfil its policy and objectives. It is
not limited to quality initiatives. Improvement in business strategy, business results,
customer, employee and supplier relationships can be subject to continual
improvement. Put simply, it means ‘getting better all the time’.' "

https://en.wikipedia.org/wiki/Continual_improvement_process
Chapter 9: The People in Information Systems

Dave Bourgeois and David T. Bourgeois

Please note, there is an updated edition of this book available at https://opentextbook.site. If you
are not required to use this edition for a course, you may want to check it out.

Learning Objectives

Upon successful completion of this chapter, you will be able to:

 describe each of the different roles that people play in the design, development, and use
of information systems;
 understand the different career paths available to those who work with information
systems;
 explain the importance of where the information-systems function is placed in an
organization; and
 describe the different types of users of information systems.

Introduction

In the opening chapters of this text, we focused on the technology behind information systems:
hardware, software, data, and networking. In the last chapter, we discussed business processes
and the key role they can play in the success of a business. In this chapter, we will be discussing
the last component of an information system: people.

People are involved in information systems in just about every way you can think
of: people imagine information systems, people develop information systems, people support
information systems, and, perhaps most importantly, people use information systems.

The Creators of Information Systems

The first group of people we are going to look at play a role in designing, developing, and
building information systems. These people are generally very technical and have a background
in programming and mathematics. Just about everyone who works in the creation of information
systems has a minimum of a bachelor’s degree in computer science or information systems,
though that is not necessarily a requirement. We will be looking at the process of creating
information systems in more detail in chapter 10.
Systems Analyst

The role of the systems analyst is to straddle the divide between identifying business needs
and imagining a new or redesigned computer-based system to fulfill those needs. This individual
will work with a person, team, or department with business requirements and identify the
specific details of a system that needs to be built. Generally, this will require the analyst to have
a good understanding of the business itself , the business processes involved, and the ability to
document them well. The analyst will identify the different stakeholders in the system and work
to involve the appropriate individuals in the process.

Once the requirements are determined, the analyst will begin the process of translating these
requirements into an information-systems design. A good analyst will understand what different
technological solutions will work and provide several different alternatives to the requester,
based on the company’s budgetary constraints, technology constraints, and culture. Once the
solution is selected, the analyst will create a detailed document describing the new system. This
new document will require that the analyst understand how to speak in the technical language of
systems developers.

A systems analyst generally is not the one who does the actual development of the information
system. The design document created by the systems analyst provides the detail needed to create
the system and is handed off to a programmer (or team of programmers) to do the actual creation
of the system. In some cases, however, a systems analyst may go ahead and create the system
that he or she designed. This person is sometimes referred to as a programmer-analyst.

In other cases, the system may be assembled from off-the-shelf components by a person called a
systems integrator. This is a specific type of systems analyst that understands how to get
different software packages to work with each other.

To become a systems analyst, you should have a background both in the business and in systems
design. Many analysts first worked as programmers and/or had experience in the business before
becoming systems analysts.

Programmer

Programmers spend their time writing computer code in a programming language. In the case of
systems development, programmers generally attempt to fulfill the design specifications given to
them by a systems analyst. Many different styles of programming exist: a programmer may work
alone for long stretches of time or may work in a team with other programmers. A programmer
needs to be able to understand complex processes and also the intricacies of one or more
programming languages. Generally, a programmer is very proficient in mathematics, as
mathematical concepts underlie most programming code.

Computer Engineer
Computer engineers design the computing devices that we use every day. There are many types
of computer engineers, who work on a variety of different types of devices and systems. Some of
the more prominent engineering jobs are as follows:

 Hardware engineer. A hardware engineer designs hardware components, such as

microprocessors. Many times, a hardware engineer is at the cutting edge of computing
technology, creating something brand new. Other times, the hardware engineer’s job is to
engineer an existing component to work faster or use less power. Many times, a hardware
engineer’s job is to write code to create a program that will be implemented directly on a
computer chip.
 Software engineer. Software engineers do not actually design devices; instead, they
create new programming languages and operating systems, working at the lowest levels
of the hardware to develop new kinds of software to run on the hardware.
 Systems engineer. A systems engineer takes the components designed by other engineers
and makes them all work together. For example, to build a computer, the mother board,
processor, memory, and hard disk all have to work together. A systems engineer has
experience with many different types of hardware and software and knows how to
integrate them to create new functionality.
 Network engineer. A network engineer’s job is to understand the networking
requirements of an organization and then design a communications system to meet those
needs, using the networking hardware and software available.

There are many different types of computer engineers, and often the job descriptions overlap.
While many may call themselves engineers based on a company job title, there is also a
professional designation of “professional engineer,” which has specific requirements behind
it. In the US, each state has its own set of requirements for the use of this title, as do different
countries around the world. Most often, it involves a professional licensing exam.

Information-Systems Operations and Administration

Another group of information-systems professionals are involved in the day-to-day operations

and administration of IT. These people must keep the systems running and up-to-date so that the
rest of the organization can make the most effective use of these resources.

Computer Operator

A computer operator is the person who keeps the large computers running. This person’s job is
to oversee the mainframe computers and data centers in organizations. Some of their duties
include keeping the operating systems up to date, ensuring available memory and disk storage,
and overseeing the physical environment of the computer. Since mainframe computers
increasingly have been replaced with servers, storage management systems, and other platforms,
computer operators’ jobs have grown broader and include working with these specialized
systems.
Database Administrator

A database administrator (DBA) is the person who manages the databases for an organization.
This person creates and maintains databases that are used as part of applications or the data
warehouse. The DBA also consults with systems analysts and programmers on projects that
require access to or the creation of databases.

Help-Desk/Support Analyst

Most mid-size to large organizations have their own information-technology help desk. The help
desk is the first line of support for computer users in the company. Computer users who are
having problems or need information can contact the help desk for assistance. Many times, a
help-desk worker is a junior-level employee who does not necessarily know how to answer all of
the questions that come his or her way. In these cases, help-desk analysts work with senior-level
support analysts or have a computer knowledgebase at their disposal to help them investigate the
problem at hand. The help desk is a great place to break into working in IT because it exposes
you to all of the different technologies within the company. A successful help-desk analyst
should have good people and communications skills, as well as at least junior-level IT skills.

Trainer

A computer trainer conducts classes to teach people specific computer skills. For example, if a
new ERP system is being installed in an organization, one part of the implementation process is
to teach all of the users how to use the new system. A trainer may work for a software company
and be contracted to come in to conduct classes when needed; a trainer may work for a company
that offers regular training sessions; or a trainer may be employed full time for an organization to
handle all of their computer instruction needs. To be successful as a trainer, you need to be able
to communicate technical concepts well and also have a lot of patience!

Managing Information Systems

The management of information-systems functions is critical to the success of information

systems within the organization. Here are some of the jobs associated with the management of
information systems.

CIO

The CIO, or chief information officer, is the head of the information-systems function. This
person aligns the plans and operations of the information systems with the strategic goals of the
organization. This includes tasks such as budgeting, strategic planning, and personnel decisions
for the information-systems function. The CIO must also be the face of the IT department within
the organization. This involves working with senior leaders in all parts of the organization to
ensure good communication and planning.
Interestingly, the CIO position does not necessarily require a lot of technical expertise. While
helpful, it is more important for this person to have good management skills and understand the
business. Many organizations do not have someone with the title of CIO; instead, the head of the
information-systems function is called vice president of information systems or director of
information systems.

Functional Manager

As an information-systems organization becomes larger, many of the different functions are

grouped together and led by a manager. These functional managers report to the CIO and
manage the employees specific to their function. For example, in a large organization, there is a
group of systems analysts who report to a manager of the systems-analysis function. For more
insight into how this might look, see the discussion later in the chapter of how information
systems are organized.

ERP Management

Organizations using an ERP require one or more individuals to manage these systems. These
people make sure that the ERP system is completely up to date, work to implement any changes
to the ERP that are needed, and consult with various user departments on needed reports or data
extracts.

Project Managers

Information-systems projects are notorious for going over budget and being delivered late. In
many cases, a failed IT project can spell doom for a company. A project manager is responsible
for keeping projects on time and on budget. This person works with the stakeholders of the
project to keep the team organized and communicates the status of the project to management. A
project manager does not have authority over the project team; instead, the project manager
coordinates schedules and resources in order to maximize the project outcomes. A project
manager must be a good communicator and an extremely organized person. A project manager
should also have good people skills. Many organizations require each of their project managers
to become certified as a project management professional (PMP).

Information-Security Officer

An information-security officer is in charge of setting information-security policies for an

organization, and then overseeing the implementation of those policies. This person may have
one or more people reporting to them as part of the information-security team. As information
has become a critical asset, this position has become highly valued. The information-security
officer must ensure that the organization’s information remains secure from both internal and
external threats.
Emerging Roles

As technology evolves, many new roles are becoming more common as other roles fade. For
example, as we enter the age of “big data,” we are seeing the need for more data analysts and
business-intelligence specialists. Many companies are now hiring social-media experts and
mobile-technology specialists. The increased use of cloud computing and virtual-machine
technologies also is breeding demand for expertise in those areas.

Career Paths in Information Systems

These job descriptions do not represent all possible jobs within an

information-systems organization. Larger organizations will have more specialized roles; smaller
organizations may combine some of these roles. Many of these roles may exist outside of a
traditional information-systems organization, as we will discuss below.

Working with information systems can be a rewarding career choice. Whether you want to be
involved in very technical jobs (programmer, database administrator), or you want to be involved
in working with people (systems analyst, trainer), there are many different career paths available.

Many times, those in technical jobs who want career advancement find themselves in a dilemma:
do they want to continue doing technical work, where sometimes their advancement options are
limited, or do they want to become a manager of other employees and put themselves on a
management career track? In many cases, those proficient in technical skills are not gifted with
managerial skills. Some organizations, especially those that highly value their technically skilled
employees, will create a technical track that exists in parallel to the management track so that
they can retain employees who are contributing to the organization with their technical skills.
 Skills that some experts believe are important for IS workers to have include the following:

1. Machine learning

2. Mobilizing applications

3. Wireless networking

4. Human-computer interface

5. Project management

6. General networking skills

7. Network convergence technology

8. Open-source programming

9. Business intelligence systems

10. Embedded security

11. Digital home technology integration

12. Languages, including C#, C++, and Java

Sidebar: Are Certifications Worth Pursuing?

As technology is becoming more and more important to businesses, hiring employees with
technical skills is becoming critical. But how can an organization ensure that the person they are
hiring has the necessary skills? These days, many organizations are including technical
certifications as a prerequisite for getting hired.

Certifications are designations given by a certifying body that someone has a specific level of
knowledge in a specific technology. This certifying body is often the vendor of the product itself,
though independent certifying organizations, such as CompTIA, also exist. Many of these
organizations offer certification tracks, allowing a beginning certificate as a prerequisite to
getting more advanced certificates. To get a certificate, you generally attend one or more training
classes and then take one or more certification exams. Passing the exams with a certain score
will qualify you for a certificate. In most cases, these classes and certificates are not free and, in
fact, can run into the thousands of dollars. Some examples of the certifications in highest demand
include Microsoft (software certifications), Cisco (networking), and SANS (security).

For many working in IT (or thinking about an IT career), determining whether to pursue one or
more of these certifications is an important question. For many jobs, such as those involving
networking or security, a certificate will be required by the employer as a way to determine
which potential employees have a basic level of skill. For those who are already in an IT career,
a more advanced certificate may lead to a promotion. There are other cases, however, when
experience with a certain technology will negate the need for certification. For those wondering
about the importance of certification, the best solution is to talk to potential employers and those
already working in the field to determine the best choice.

Organizing the Information-Systems Function

In the early years of computing, the information-systems function (generally called data
processing) was placed in the finance or accounting department of the organization. As
computing became more important, a separate information-systems function was formed, but it
still was generally placed under the CFO and considered to be an administrative function of the
company. In the 1980s and 1990s, when companies began networking internally and then linking
up to the Internet, the information-systems function was combined with the telecommunications
functions and designated the information technology (IT) department. As the role of information
technology continued to increase, its place in the organization also moved up the ladder. In many
organizations today, the head of IT (the CIO) reports directly to the CEO.

Where in the Organization Should IS Be?

Before the advent of the personal computer, the information-systems function was centralized
within organizations in order to maximize control over computing resources. When the PC began
proliferating, many departments within organizations saw it as a chance to gain some computing
resources for themselves. Some departments created an internal information-systems group,
complete with systems analysts, programmers, and even database administrators. These
departmental-IS groups were dedicated to the information needs of their own departments,
providing quicker turnaround and higher levels of service than a centralized IT department.
However, having several IS groups within an organization led to a lot of inefficiencies: there
were now several people performing the same jobs in different departments. This
decentralization also led to company data being stored in several places all over the company. In
some organizations, a “matrix” reporting structure has developed, in which IT personnel are
placed within a department and report to both the department management and the functional
management within IS. The advantages of dedicated IS personnel for each department are
weighed against the need for more control over the strategic information resources of the
company.
For many companies, these questions are resolved by the implementation of the ERP system (see
discussion of ERP in chapter 8). Because an ERP system consolidates most corporate data back
into a single database, the implementation of an ERP system requires organizations to find
“islands” of data so that they can integrate them back into the corporate system. The ERP allows
organizations to regain control of their information and influences organizational decisions
throughout the company.

Outsourcing

Many times, an organization needs a specific skill for a limited period of time. Instead of training
an existing employee or hiring someone new, it may make more sense to outsource the job.
Outsourcing can be used in many different situations within the information-systems function,
such as the design and creation of a new website or the upgrade of an ERP system. Some
organizations see outsourcing as a cost-cutting move, contracting out a whole group or
department.

New Models of Organizations

The integration of information technology has influenced the structure of organizations. The
increased ability to communicate and share information has led to a “flattening” of the
organizational structure due to the removal of one or more layers of management.

Another organizational change enabled by information systems is the network-based

organizational structure. In a networked-based organizational structure, groups of employees can
work somewhat independently to accomplish a project. In a networked organization, people
with the right skills are brought together for a project and then released to work on other projects
when that project is over. These groups are somewhat informal and allow for all members of the
group to maximize their effectiveness.

Information-Systems Users – Types of Users

Besides the people who work to create, administer, and manage information systems, there is one
more extremely important group of people: the users of information systems. This group
represents a very large percentage of the people involved. If the user is not able to successfully
learn and use an information system, the system is doomed to failure.
 Technology adoption user types (click to
enlarge). (Public Domain)

One tool that can be used to understand how users will adopt a new technology comes from a
1962 study by Everett Rogers. In his book, Diffusion of Innovation,[1] Rogers studied how
farmers adopted new technologies, and he noticed that the adoption rate started slowly and then
dramatically increased once adoption hit a certain point. He identified five specific types of
technology adopters:

 Innovators. Innovators are the first individuals to adopt a new technology. Innovators are
willing to take risks, are the youngest in age, have the highest social class, have great
financial liquidity, are very social, and have the closest contact with scientific sources
and interaction with other innovators. Risk tolerance has them adopting technologies that
may ultimately fail. Financial resources help absorb these failures (Rogers 1962 5th ed, p.
282).
 Early adopters. The early adopters are those who adopt innovation after a technology has
been introduced and proven. These individuals have the highest degree of opinion
leadership among the other adopter categories, which means that they can influence the
opinions of the largest majority. They are typically younger in age, have higher social
status, more financial liquidity, more advanced education, and are more socially
aware than later adopters. These people are more discrete in adoption choices than
innovators, and realize judicious choice of adoption will help them maintain a central
communication position (Rogers 1962 5th ed, p. 283).
 Early majority. Individuals in this category adopt an innovation after a varying degree of
time. This time of adoption is significantly longer than the innovators and early adopters.
This group tends to be slower in the adoption process, has above average social status,
has contact with early adopters, and seldom holds positions of opinion leadership in a
system (Rogers 1962 5th ed, p. 283).
 Late majority. The late majority will adopt an innovation after the average member of the
society. These individuals approach an innovation with a high degree of skepticism, have
below average social status, very little financial liquidity, are in contact with others in the
late majority and the early majority, and show very little opinion leadership.
 Laggards. Individuals in this category are the last to adopt an innovation. Unlike those in
the previous categories, individuals in this category show no opinion leadership. These
 individuals typically have an aversion to change-agents and tend to be advanced in
age. Laggards typically tend to be focused on “traditions,” are likely to have the lowest
social status and the lowest financial liquidity, be oldest of all other adopters, and be in
contact with only family and close friends.

These five types of users can be translated into information-technology adopters as well, and
provide additional insight into how to implement new information systems within an
organization. For example, when rolling out a new system, IT may want to identify the
innovators and early adopters within the organization and work with them first, then leverage
their adoption to drive the rest of the implementation.

Summary

In this chapter, we have reviewed the many different categories of individuals who make up the
people component of information systems. The world of information technology is changing so
fast that new roles are being created all the time, and roles that existed for decades are being
phased out. That said, this chapter should have given you a good idea of the importance of the
people component of information systems.

Study Questions

1. Describe the role of a systems analyst.

2. What are some of the different roles for a computer engineer?
3. What are the duties of a computer operator?
4. What does the CIO do?
5. Describe the job of a project manager.
6. Explain the point of having two different career paths in information systems.
7. What are the advantages and disadvantages of centralizing the IT function?
8. What impact has information technology had on the way companies are organized?
9. What are the five types of information-systems users?
10. Why would an organization outsource?

Exercises

1. Which IT job would you like to have? Do some original research and write a two-page
paper describing the duties of the job you are interested in.
2. Spend a few minutes on Dice or Monster to find IT jobs in your area. What IT jobs are
currently available? Write up a two-page paper describing three jobs, their starting salary
(if listed), and the skills and education needed for the job.
 3. How is the IT function organized in your school or place of employment? Create an
organization chart showing how the IT organization fits into your overall organization.
Comment on how centralized or decentralized the IT function is.
4. What type of IT user are you? Take a look at the five types of technology adopters and
then write a one-page summary of where you think you fit in this model.

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