Information Technology and

E-Business

Dr. Tarun Kumar Singhal

MISSION VISION CORE VALUES

CHRIST is a nurturing ground for an individual’s Excellence and Service Faith in God | Moral Uprightness
holistic development to make effective contribution Love of Fellow Beings
to the society in a dynamic environment Social Responsibility | Pursuit of Excellence
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Unit 1
INFORMATION SYSTEMS AND E-BUSINESS
(10 Hours)
 Concept of Information system,
 Role of Information System in Business,
 Trends in Information System,
 Types of Information System,
 Components of Information System,
 Information System Resources,
 Information System Activities,
 Business Process,
 Role of Information Systems function in Business,
 Data Processing,
 Data Processing Cycle
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Concept of Information System

Information System
“Interrelated components working together to
collect, process, store and disseminate information
to support decision making, coordination, control,
analysis, and visualization in an organization”
Laudon and Laudon

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Concept of Information System

Information System
In addition to supporting decision making,
coordination, and control, information systems may
also help managers and workers analyze problems,
visualize complex subjects, and create new products.

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Concept of Information System

Information System
Information systems contain information about
significant people, places, and things within the
organization or in the environment surrounding it.
By information we mean data that have been
shaped into a form that is meaningful and useful to
human beings. Data, in contrast, are streams of raw
facts representing events occurring in organizations
or the physical environment before they have been
organized and arranged into a form that people can
understand and use.
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Concept of Information System

Data vs Information
Supermarket checkout counters scan millions of
pieces of data from bar codes, which describe each
product.
Such pieces of data can be totaled and analyzed to
provide meaningful information, such as the total
number of bottles of dish detergent sold at a
particular store, which brands of dish detergent were
selling the most rapidly at that store or sales
territory, or the total amount spent on that brand of
dish detergent at that store or sales region.
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Concept of Information System

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Role of Information System in Business

Need information about environment

Customers, Suppliers, Regulators, Competitors and
internals of organization
Resource management (human and physical)
Optimization of work flow
Financial management

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Role of Information System in Business

Information systems perform three vital roles in business

firms.
They support:
Business processes and operations,
Business decision making; and
Strategic competitive advantage

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Role of Information System in Business

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Trends in Information System

Many occupations concerned with the handling processing,

provision or transmission of information
Examples found in insurance, banks, health, police,
government, defense, agriculture

Most organizations use information systems to prosper and

to survive in the market place while achieving the following
objectives:
manage risk
cut costs
gain competitive advantage

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Trends in Information System

Meeting Global Challenges

Capturing opportunities in the Market Place
Supporting Corporate Strategy
Linking Departments Whose Functions are different
Enhancing Worker Productivity
Increasing Quality of Goods and Services

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Trends in Information System

Relentless Pressure on Business

Three powerful influences
Emergence of the Global Economy
Transformation of industrial Economies
Transformation of the Business Environment

Strong drive to reduce business costs

Inventory, labor, transaction cost
Use IT to eliminate the middle men
without losing the competitiveness they enforced

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Types of Information Systems

Executive Support Systems (ESS)

Decision Support Systems (DSS)
Management Information Systems (MIS)
Knowledge Work Systems (KWS)
Office Automation Systems (OAS)
Transaction Processing Systems (TPS)

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Types of Information Systems

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Interrelationships Among Information Systems

ESS

MIS DSS

KWS
TPS
OAS
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Architecture of Information Systems

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Challenges for IS in a Multinational Organization

Technological barriers
Regulations and tariffs
Electronic payment mechanisms
Different language and culture
Economic and political considerations
Different measurement standards
Legal barriers

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Information System Activities

An information system contains information about an organization

and its surrounding environment.

Three basic activities—input, processing, and output—produce the

information organizations need. Feedback is output returned to
appropriate people or activities in the organization to evaluate and
refine the input.

Environmental actors, such as customers, suppliers, competitors,

stockholders, and regulatory agencies, interact with the
organization and its information systems.

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Components of Information System

An Information system is a combination of hardware and

software and telecommunication networks that people build
to collect, create and distribute useful data, typically in an
organization.

It defines the flow of information within the system.

The objective of an information system is to provide

appropriate information to the user, to gather the data,
process the data and communicate information to the user of
the system.

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Components of Information System

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Components of Information System

Computer Hardware:
Physical equipment used for input, output and processing.
The hardware structure depends upon the type and size of the
organization.
It consists of an input and an output device, operating
system, processor, and media devices.
This also includes computer peripheral devices.

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Components of Information System

Computer Software:
The programs/ application program used to control and
coordinate the hardware components. It is used for analyzing
and processing of the data. These programs include a set of
instruction used for processing information.

Software is further classified into 3 types:

System Software
Application Software
Procedures
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Components of Information System

Databases:
Data are the raw facts and figures that are unorganized that
are and later processed to generate information. Software are
used for organizing and serving data to the user, managing
physical storage of media and virtual resources.
As the hardware can’t work without software the same as
software needs data for processing. Data are managed using
Database management system.
Database software is used for efficient access for required
data, and to manage knowledge bases.

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Components of Information System

Network:
Networks resources refer to the telecommunication networks
like the intranet, extranet and the internet. These resources
facilitate the flow of information in the organization.
Networks consists of both the physicals devises such as
networks cards, routers, hubs and cables and software such
as operating systems, web servers, data servers and
application servers.
Telecommunications networks consist of computers,
communications processors, and other devices
interconnected by communications media and controlled by
software.
Networks include communication media, and Support.
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Components of Information System

Human Resources:
It is associated with the manpower required to run and
manage the system. People are the end user of the
information system, end-user use information produced for
their own purpose, the main purpose of the information
system is to benefit the end user.
The end user can be accountants, engineers, salespersons,
customers, clerks, or managers etc. People are also
responsible to develop and operate information systems.
They include systems analysts, computer operators,
programmers, and other clerical IS personnel, and
managerial techniques.

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Information System Activities

The major activities of an information system are;
1. Input of Data Resource
Data about business transactions and other events must be
captured and prepared for processing by the input activity.
Input typically takes the form of data entry activities such as
recording and editing. End uses typically record data about
transactions on some type of physical medium such as paper
form, or enter it directly into a computer system.
This usually includes a variety of editing activities to ensure
that they have recorded data correctly. Once entered, data
may be transferred onto a machine-readable medium such as
a magnetic disk until needed for processing.

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Information System Activities

2. Processing of Data into Information
Data is typically subjected to processing activities such as
calculating, comparing, sorting, classifying, and
summarizing.
These activities organize, analyze and manipulate data, thus
converting them into information for end users.
The quality of any data stored in an information system must
also be maintained by a continual process of correcting and
updating activities.

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Information System Activities

2. Processing of Data into Information
For example, data received about a purchase can be
(1) added to a running total of sales results,
(2) compared to a standard to determine eligibility for a sales
discount,
(3) sorted in numerical order based on product identification
numbers,
(4) classified into product categories (such as food and
nonfood items),
(5) summarized to provide a sales manager with information
about various product categories, and finally,
(6) used to update sales records.
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Information System Activities

3. Output of Information Products
Information in various forms is transmitted to end-users and
made available to them in the output activity. The goal of
information systems is the production of appropriate
information products for end users.
Common information products messages, reports, forms, and
graphic images, which may be provided by video displays,
audio responses, paper products, and multimedia.
For example, a sales manager may view a video display to
check on the performance of a salesperson, accept a
computer-produced voice message by telephone, and receive
a printout of monthly sales results.

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Information System Activities

4. Storage of Data Resource
Storage is a basic system component of information systems.
Storage is the information system activity in which data and
information are retained in an organized manner for later
use.
For example, just as written text material is organized into
words, sentences, paragraphs, and documents, stored data is
commonly organized into fields, records, files, and database.
This facilitates its later use in processing or its retrieval as
output when needed by users of a system.

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Information System Activities

5. Control of System Performance
An important information system activity is the control of its
performance. An information system should produce
feedback about its input, processing, output, and the system
is meeting established performance standards. Then
appropriate system activities must be adjusted so that proper
information products are produced for end users.
For example, a manager may discover that subtotals of sales
amounts in a sales report do not add up to total sales. This
might mean that data entry or processing procedures need to
be corrected. Then changes would have to be made to ensure
that all sales transactions would be properly captured and
processed by a sales information system.

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Business Process
A business process is a series of steps performed by a group of
stakeholders to achieve a concrete goal.
Each step in a business process denotes a task that is assigned
to a participant.
It is the fundamental building block for several related ideas
such as business process management, process automation,
etc.
The need for and advantages of a business process are quite
apparent in large organizations.
A process forms the lifeline for any business and helps it
streamline individual activities, making sure that resources
are put to optimal use.

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Business Process

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Business Process
Let’s consider the hiring process of an HR department. Right
from posting the job opening to onboarding the employee,
there are multiple steps involved in the process.
The HR executive posts the job update
Multiple candidates apply in a portal
The HR executive screens and filters the candidates
The selected candidates are called for the next stages
The right candidate is chosen at the last stage
Salary and policy negotiations take place
The offer letter is sent and the candidate accepts
This is then followed by employee onboarding process

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Role of Information Systems function in Business

Organizations strive to be market leaders in their given
industry. In climates where factors such as recession,
inflationary pressures and increased competition can hinder
the achievement of this goal, companies look for strategies
that lead to competitive advantages.
One such strategy is the adoption of information systems
within the company. Information systems help a company
make adequate use of its data, reduce workload and assist
with compliance with various mandatory regulations.

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Role of Information Systems function in Business

Information Storage and Analysis
At the date of publication, many companies no longer manage
their data and information manually with registers and hard-
copy formats. Through the adoption of information systems,
companies can make use of sophisticated and comprehensive
databases that can contain all imaginable pieces of data about
the company.
Information systems store, update and even analyze the
information, which the company can then use to pinpoint
solutions to current or future problems. Furthermore, these
systems can integrate data from various sources, inside and
outside the company, keeping the company up to date with
internal performance and external opportunities and threats.

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Role of Information Systems function in Business

Assist With Making Decisions
The long-term success of a company depends upon the
adequacy of its strategic plans. An organization’s
management team uses information systems to formulate
strategic plans and make decisions for the organization's
longevity and prosperity.
The business uses information systems to evaluate
information from all sources, including information from
external references such as Reuters or Bloomberg, which
provide information on the general economy.
This analysis of and comparison to market trends helps
organizations analyze the adequacy and quality of their
strategic decisions.

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Role of Information Systems function in Business

Assist With Business Processes
Information systems aid businesses in developing a larger
number of value added-systems in the company.
For example, a company can integrate information systems
with the manufacturing cycle to ensure that the output it
produces complies with the requirements of the various
quality management standards.
Adoption of information systems simplifies business
processes and removes unnecessary activities.

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Role of Information Systems function in Business

Assist With Business Processes
Information systems add controls to employee processes,
ensuring that only users with the applicable rights can
perform certain tasks.
Further, information systems eliminate repetitive tasks and
increase accuracy, allowing employees to concentrate on
more high-level functions.
Information systems can also lead to better project planning
and implementation through effective monitoring and
comparison against established criteria.

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Data Processing
Data in its raw form is not useful to any organization. Data
processing is the method of collecting raw data and
translating it into usable information. It is usually performed
in a step-by-step process by a team of data scientists and data
engineers in an organization.
The raw data is collected, filtered, sorted, processed,
analyzed, stored, and then presented in a readable format.
Data processing is crucial for organizations to create better
business strategies and increase their competitive edge.
By converting the data into a readable format like graphs,
charts, and documents, employees throughout the
organization can understand and use the data.

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Data Processing Cycle

The data processing cycle is the set of operations used to
transform data into useful information. The intent of this
processing is to create actionable information that can be
used to enhance a business.
Collection of data
Preparation of the data into a format suitable for data entry,
as well as error checking
Entry of the data into the system, which may involve
manual data entry, scanning, machine encoding, etc.
Processing of the data with computer programs
Transmitting the resulting information to the user
Storing the input data and output information for future
use
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Data Processing Cycle

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Data Processing Cycle

Step 1: Collection
The collection of raw data is the first step of the data
processing cycle. The type of raw data collected has a huge
impact on the output produced.
Hence, raw data should be gathered from defined and
accurate sources so that the subsequent findings are valid and
usable.
Raw data can include monetary figures, website cookies,
profit/loss statements of a company, user behavior, etc.

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Data Processing Cycle

Step 2: Preparation
Data preparation or data cleaning is the process of sorting
and filtering the raw data to remove unnecessary and
inaccurate data.
Raw data is checked for errors, duplication, miscalculations
or missing data, and transformed into a suitable form for
further analysis and processing.
This is done to ensure that only the highest quality data is fed
into the processing unit.

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Data Processing Cycle

Step 3: Input
In this step, the raw data is converted into machine readable
form and fed into the processing unit. This can be in the form
of data entry through a keyboard, scanner or any other input
source.

Step 4: Data Processing

In this step, the raw data is subjected to various data
processing methods using machine learning and artificial
intelligence algorithms to generate a desirable output. This
step may vary slightly from process to process depending on
the source of data being processed (data lakes, online
databases, connected devices, etc.) and the intended use of
the output.
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Data Processing Cycle

Step 5: Output
The data is finally transmitted and displayed to the user in a
readable form like graphs, tables, vector files, audio, video,
documents, etc. This output can be stored and further
processed in the next data processing cycle.

Step 6: Storage
The last step of the data processing cycle is storage, where
data and metadata are stored for further use. This allows for
quick access and retrieval of information whenever needed,
and also allows it to be used as input in the next data
processing cycle directly.

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 Thanks

MISSION VISION CORE VALUES

CHRIST is a nurturing ground for an individual’s Excellence and Service Faith in God | Moral Uprightness
holistic development to make effective contribution Love of Fellow Beings
to the society in a dynamic environment Social Responsibility | Pursuit of Excellence