Unit II: Foundation of IS

An Information System is a collection of

hardware, software, data, people and procedures
that are designed to generate information that
supports the day-to-day, short-range, and
long-term activities of users in an organization.
IS helps in planning / coordinating, controlling and
decision making functions within an organization.
 Data & Information

Data:
Data is raw, unorganized facts that need to be
processed. Data can be something simple and
seemingly random and useless until it is organized.

Information:
When data is processed, organized, structured or
presented in a given context so as to make it useful, it is
called information.
 Data Vs Information

Data Information
- No meaning - Has meaning

- Is always right - might not always be right

- Unorganized - Organized

- Not helpful in decision - Helpful in gaining knowledge required

for decision making

- Records and Observations - Analysis of Data

- Independent - Dependent on Data

 Characteristics of Information

Good information is that which is used and which creates value:

- Available/Accessible
- Accurate
- Reliable
- Relevant
- Complete
- Presentable
- Well timed
- Low cost to obtain
- High Value
 Knowledge

The understanding we can get from the

information we have that aids in
decision-making process.
How IS helps in decision making
Major areas (framework) of IS knowledge
 Major areas (framework) of IS knowledge

Foundation Concepts:
Fundamental behavioral, technical, business and
managerial concepts about the components and roles
of IS.

Eg. Competitive strategy concepts used to develop

business applications
Major areas (framework) of IS knowledge

Information Technologies:
Major concepts, developments, and management
issues in IT.

Eg. Hardware, software, networks, data management,

Internet Technologies
 Major areas (framework) of IS knowledge

Management Challenges:
The challenges of effectively and ethically managing IT
at the end-user, enterprise and global levels of business.

Eg. Security challenges, security management

 Major areas (framework) of IS knowledge

Business Applications:
The major uses of IS for the operations, management,
and competitive advantage of a business.

Eg. Use of IS in marketing, manufacturing, accounting

Fundamental Roles of Business Applications of IS
 Support of Business Process & Operations

As a consumer, you regularly encounter information systems

that support the business processes and operations at the many
retail stores where you shop. For example, most retail stores
now use computer-based information systems to help their
employees record customer purchases, keep track of inventory,
pay employees, buy new merchandise, and evaluate sales
trends. Store operations would grind to a halt without the
support of such information systems.
 Support of Business Decision Making

Information systems also help store managers and other

business professionals make better decisions. For example,
decisions about what lines of merchandise need to be added or
discontinued and what kind of investments they require are
typically made after an analysis provided. This function not only
supports the decision making of store managers, buyers, and
others, but also helps them look for ways to gain an advantage
over other retailers in the competition for customers.
Support for Strategies for Competitive Advantage

Gaining a strategic advantage over competitors requires the

innovative application of information technologies. For example,
store management might make a decision to install
touch-screen kiosks in all stores, with links to the e-commerce
Web site for online shopping. This offering might attract new
customers and build customer loyalty because of the ease of
shopping and buying merchandise provided by such information
systems. Thus, strategic information systems can help provide
products and services that give a business a comparative
advantage over its competitors.
 Major areas (framework) of IS knowledge

Development Process:
How business professionals and information specialists
plan, development and implement IS to meet business
opportunities..

Eg. Software development methods

The expanding
roles of the
business
applications of
IS
Functions &
Environment
of IS
Components
of IS
IS Activities
IS Resources
& Products
Developing IS
 Developing IS

Investigate: Find the problem. Plan!

Analyze: What are we doing?
Design: Find the solution.
Implement: Build the solution into real product.
Maintain: How are we doing? Where are we improve?
Where do we need to fix?
Potential Risks of IS
Types of IS
Levels of IS
 Transaction Processing Systems (TPS)

Process data resulting from business

transactions, update operational
databases, and produce business
documents. Examples: sales and
inventory processing and accounting
systems.
 Management Information Systems (MIS)

Provide information in the form of

prespecified reports and displays to
support business decision making.
Examples: sales analysis, production
performance, and cost trend reporting
systems.
 Decision Support Systems (DSS)

Provide interactive ad hoc support for the

decision-making processes of managers
and other business professionals.
Examples: product pricing, profitability
forecasting, and risk analysis systems.
 Executive Information Systems (EIS)

Provide critical information from MIS, DSS,

and other sources tailored to the
information needs of executives. Examples:
systems for easy access to analyses of
business performance, actions of
competitors, and economic developments
to support strategic planning.
 Jan 10, 2020 (Presentation)

TPS - 10 minutes (Group A)

MIS - 10 minutes (Group B)
EIS - 10 minutes (Group C)
DSS - 10 minutes (Group D)