What Is An Information System?

An information system (IS) can be any organized combination of people, hardware, software, communications
networks, data resources and policies and procedures that stores, retrieves, transforms and disseminates
information in an organization.
People rely on modern information systems to communicate with one another using a variety of physical
devices (hardware), information processing instructions and procedures (software), communications channels
(networks) and stored data (data resources). Although today’s information systems are typically thought of as
having something to do with computers, we have been using information systems since the dawn of
civilization.
Even today we make regular use of information systems that have nothing to do with a computer. Consider
some of the following examples of information systems:
 Smoke signals for communication were used as early as recorded history and can account for the human
discovery of fire. The pattern of smoke transmitted valuable information to others who were too far to see
or hear the sender.
 Card catalogs in a library are designed to store data about the books in an organized manner that allows
readers to locate a particular book by its title, author name, subject or a variety of other approaches.
 The cash register

Why should manufacturing companies build smart products and provide smart services?

What business benefits can be gained?

Provide several examples beyond discussed in this case

What information technologies are used by the companies in this case to build smart products and
provide smart services?

What are some limitations of a smart products and smart services strategies?

Use the internet to investigate how Heidelberg, is proceeding in its use of smart products and services.

Computer Based Information System & Information Technologies:

1. Computer hardware technologies.
2. Computer software technologies.
3. Telecommunications network technologies.
4. Data resource management technologies.

Data & Information

Data can be defined as a representation of facts, concepts or instructions in a formalized manner, which should
be suitable for communication, interpretation or processing by human or electronic machine.
Information is organized or classified data, which has some meaningful values for the receiver. Information is
the processed data on which decisions and actions are based.

Characteristics of Good Information

Good information should be timely and available when it is needed. The following are the characteristics of
good information:
  Accurate
 Complete
 Cost Effective
 User-focused
 Relevant
 Authoritative
 Timely

Competitive advantage of information and MIS

Competitive advantage is a position that makes a business more profitable than its competitors. For example,
producing products at a lower cost than your competitors makes you more profitable.
Information systems have the capacity to help an organization into such a position. They do so in the
following ways:
 Operational excellence
 New business models, products, and services
 Improved supplier and customer relations
 Improved decision making

Porter's Value chain

The concept of a value chain was developed by Michael Porter. Porter's value chain has two activities namely:
 Primary activities – these are activities that are related to the creating products/services, marketing and
sales and support. Primary activities consist of inbound logistics, operations, outbound logistics,
marketing and sales and service.
 Support activities – these are activities that support the primary activities. Support activities consist of
procurement (purchasing), human resource management, technological development and infrastructure.

The overall goal of the value chain is to help a business gain competitive advantage. Competitive advantage is
a business's position in a market that makes it to be more profitable than its direct competitors.
Pyramid Diagram of Organizational levels and information requirements
Transaction Processing System (TPS)
Transaction processing systems are used to record day to day business transactions of the organization. They
are used by users at the operational management level. 
By recording the day to day business transactions, TPS system provides answers to the above questions in a
timely manner.
 The decisions made by operational managers are routine and highly structured.
 The information produced from the transaction processing system is very detailed.
Examples of transaction processing systems include:
 Point of Sale Systems – records daily sales
 Payroll systems – processing employees’ salary, loans management etc.
 Stock Control systems – keeping track of inventory levels
 Airline booking systems – flights booking management

Decision Support System (DSS)

Decision support systems use input from internal systems (transaction processing systems and management
information systems) and external systems.
The main objective of decision support systems is to provide solutions to problems that are unique and change
frequently.
Examples of decision support systems include:
 Financial planning systems
 Bank loan management systems

Artificial intelligence techniques in business

Artificial intelligence systems mimic human expertise to identify patterns in large data sets. Companies such
as Amazon, Facebook and Google etc. use artificial intelligence techniques to identify data that is most
relevant to you.

Online Analytical Processing (OLAP)

Online analytical processing (OLAP) is used to query and analyze multi-dimensional data and produce
information that can be viewed in different ways using multiple dimensions.
 The main objective of OLAP systems is to provide answers to ad hoc queries within the shortest possible
time regardless of the size of the datasets being used.

Networking devices
Networking devices are used to interconnect computing resources so that they can communicate with each
other.
Telecommunication is the exchange of information over long distances. Telecommunication uses transmitters
and receivers to facilitate communication. Signals can be sent via physical cables or the sent via a wireless
network.
A telecommunication network refers to multiple transmitters and receivers exchanging data. The internet is an
example of a large telecommunication network.

M-Commerce

Internet access everywhere

Cell phones
Tablets
Laptops

Great potential
Limited usability
Better than voice?

Global Telecommunications
 Technical problems
 Multiple standards
 Language
 Developing nations
 Time zones
 Limits to space & waves
 Political complications
 Transborder data flows
 Taxes
 Privacy
 Accessibility
 Cultural issues
 What is an object?
 Management & control

Data Management, Designing Databases

A database is a collection of related data stored in one place with minimum redundancy. Most business
applications record the day to day business transactions through these databases.
The data could be in the form of documents, audio, video, software installation packages, database backups
etc. The most common storage devices are external discs.
Storage devices with networking capabilities also exist that can be used to share files on a network.

Database Advantages

 Focus on data
 Stable data
 Programs change
 Data independence
 Change programs without altering data.
 Data integrity
  Accuracy
 Time
 Concurrency
 Security
 Ad hoc queries
 Speed of development
 Report writers
 Input forms
 Data manipulation
 Flexibility & Queries

E-Business Databases
 E-business is transaction-based
 Databases support multiple users and protect transactions
 Modern websites are driven by databases

Database Queries

Four questions to create a query

1) What output do you want to see?

2) What do you already know? (constraints)
3) What tables are involved?
4) How are the tables joined?

 Single Table
 Computations
 Joining Tables