Assumption University of Thailand

Graduate School of Business and Advanced Technology Management

(GSB-ATM)

Management Information Systems

Information Systems
in Global Business Today

Dr. Poonphon Suesaowaluk

Objectives
• To introduce the concepts of management information
systems, information technology, and information
systems.
• To demonstrate how information systems are reshaping
firms and why they are critical to today's corporate
operations and management,
• To identify the academic discipline that studies
information systems.
• To encourage students to put their non-routine skills
obtained in MIS into practice.
Topics
• Information Systems in business today
• Dimensions and components of information systems
• Approach of studying Information Systems
Information Systems in
Business Today
 Figure 1.1 Information Technology Capital
Investment

Copyright © 2022, 2020, 2018 Pearson Education, Ltd. All Rights Reserved
Information Systems are Transforming
Business
1. IT Innovations
2. New Business Models
3. E-commerce Expanding
4. Management Changes
5. Firms and Organizations Change
Information Systems are Transforming Business
• IT Innovations
– Cloud computing, big data, Internet of Things
– Mobile digital platform
– AI and machine learning
– Use of social networks for business objectives
• New Business Models
– Online streaming and downloadable video
‣ Examples: Netflix, Apple TV Channels, Amazon
Information Systems are Transforming Business

• E-commerce Expansion
– E-commerce worldwide expands to nearly $3.6 trillion in 2019
– Growth in social commerce spurred by growth of mobile platform
– Mobile retail e-commerce growing more than 20 percent a year,
reaching almost $300 billion in 2020
• Management Changes
– Managers becoming more mobile, use social networks,
collaboration tools
– Business intelligence applications accelerate
Information Systems are Transforming Business

• Firms and Organizations Change

– More collaborative, less emphasis on hierarchy and
structure
– Greater emphasis on competencies and skills
– Higher-speed/more accurate decision making based on
data and analysis
– More willingness to interact with consumers (social media)
– Better understanding of the importance of IT
Information Systems are Transforming Business
Information systems are transforming business.
• Expansion of using the Internet, the decline in newspaper
readership, the increase in online news, and the growth of
digital information
• Systems used to improve customers’ experiences, respond to
customer demand, reduce inventories, etc.
• Expanding e-commerce and Internet advertising
• New federal security and accounting laws: e-mail information is
kept track of for 5 years.
Emerging Digital Firm
Digital firms:
– Significant business process and relationship with customers,
supplier and employees are digitally enabled and mediated
– Key cooperate assets are managed through digital means
– Core business process are accomplished through digital
networks
• Digital firms offer greater flexibility in organization and
management
– Time shifting, space shifting, digital firms are ideally suited
for global operations which take place in remote locations
and different time zones
Strategic Business Objectives of Information
Systems
• Growing interdependence between:
– Ability to use information technology
– Ability to implement corporate strategies and
achieve corporate goals
The Interdependence Between
Organizations and Information Systems

Source: Kenneth C Laudon, Jane P. Laudon, 2022

Strategic Business Objectives of Information
Systems (1of 4)
• Firms invest heavily in information systems to achieve six
strategic business objectives:
1. Operational excellence
2. New products, services and business models
3. Customer and Supplier intimacy
4. Improved decision making
5. Competitive advantage
6. Survival
Strategic Business Objectives of Information
Systems(2 of 4)
• Operational excellence:
– Improve efficiency of the operations to achieve higher
profitability, productivity
• New product, service, business models:
– business model describes how company produces, delivers
and sells a product or service to create wealth
– Example Apple; transformed old model of music distribution
with new products, service, iTune, iPad
Strategic Business Objectives of Information
Systems(3 of 4)
• Customer and supplier intimacy
– Serving customers well leads to customers returning which raises
revenues and profits
– The more business engages its supplier the better the suppliers can
provide vital inputs which lowers costs
• Improve decision making
– Using the real time data/information from marketplace when making decision
instead of guesses, luck
– Accurate production, allocate resources efficiently
– Real-time data improves ability of managers to make decisions
‣ Example: Verizon’s web-based digital dashboard to provide managers with real-
time data on customer complaints, network performance, line outages, etc.
Strategic Business Objectives of Information
Systems(4 of 4)
• Competitive advantage
– Charging less for superior products, better performance
– Responding to both customers and suppliers in real-time

• Survival
– Many regulations of the business state to create a legal record for
company and employees
– Industry-level changes e.g. Citibank introduced ATM service
– Government regulations requiring record-keeping e.g. Toxic
Substances Control Act, Sarbanes-Oxley Act
Dimensions and Components
of Information Systems
Information Systems
Information technology: the hardware and software a business
uses to achieve objectives
Information System: “A set of interrelated components that collect
retrieve, process store, and distribute information to support decision
making and control in an organization” (Kenneth C. Laudon, Jane O.
Laudon, 2018)
Data: Stream 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
Information: Data that has been shaped into a form that is
meaningful and useful to the human being
Data and Information

Source: Kenneth C Laudon, Jane P. Laudon, 2022

 Functions of an Information System

Copyright © 2022, 2020, 2018 Pearson Education, Ltd. All Rights Reserved
Difference Between IT and IS
Information Technology (IT)
1. Products
IT People
2. Methods
IS
3. Inventions
4. Standards
Procedure
‣ IT drives development of new IS.
‣ IT components = Hardware + Software + Data
‣ IS = IT + Procedures + People

Source: David Kroenke, Randall J. Boyle, 2017

Components of an Information System

Components interact to produce information

Source: David Kroenke, Randall J. Boyle, 2017

 Dimensions of Information Systems: Information
Technology
• Computer hardware and software
• Data management technology
• Networking and telecommunications technology
- Networks, the Internet, intranets and extranets, World
Wide Web
• I T infrastructure: provides platform that system is built
on

Copyright © 2022, 2020, 2018 Pearson Education, Ltd. All Rights Reserved
Dimension of Information Systems
• Organization: IS involves issues such as the
organization’s hierarchy, functional specialties, business
processes, culture, and political interest groups.
– Senior, Middle, Operational Management
• Management: manage what exists and create new
product/services re-create the organization from time to
time
• Information Technology: Hardware, Software, data
management technology, Internet, World Wide
Web(WWW), Information Technology Infrastructure.
Business Perspective on IS (1 of 3)
• Information system is the instrument for creating value
• Investments in information technology will result in
superior returns
– Productivity increases
– Revenue increment
– Superior long-term strategic positioning
Business Perspective on IS (2 of 3)
• Business information value chain
– Raw data acquired and transformed through stages that add
value to that information
– Value of information system determined in part by extent to
which it leads to better decisions, greater efficiency, and
higher profits
– Three ways an Information Systems can add value to
business
I. Decision making
II. Help make business process more efficient
III. Increase profitability
Business Perspective on IS (3 of 3)
• Business perspective
– Calls attention to organizational and managerial nature of
• Investing in information technology does not guarantee good
returns
• There is considerable variation in the returns firms receive
from systems investments
• Factors
– Adopting the right business model
– Investing in complementary assets (organizational and
management capital)
Figure: Business Information Value Chain

Source: Kenneth C Laudon, Jane P. Laudon, 2018

Complementary assets of Information Systems
(1 of 2)
– Assets required to derive value from a primary investment
– Firms supporting technology investments with investment in
complementary assets receive superior returns
– Example: Invest in technology and the people to make it
works properly
Complementary assets of Information Systems
(2 of 2)
Supportive organizational culture that values efficiency and effectiveness
Example:
Organizational assets
Appropriate business model
Efficient business processes

Strong senior management support for technology investment and change

incentives for management innovation
Example:
Managerial assets Teamwork and collaborative work environments
Training programs to enhance management decision skills
Management culture that values flexibility and knowledge-based decision making

The Internet and telecommunication infrastructure

IT-enriched educational programs raising labor force computer literacy
Social assets Standards (both government and private sector)
Laws and regulations creating fair, stable market environments
Technology and service firms in adjacent markets to assists implementation

Source: Kenneth C Laudon, Jane P. Laudon, 2018

Approaches of Studying
Information Systems
Approaches of Studying Information Systems
• Technical approach: focusing on formal models and capabilities of
system, computer science, management science, operations
research
• Behavioral approach: focusing on design, implementation,
management, business impact (psychology, sociology and
economics)
• Sociotechnical approach:
– Combines technical and social features and solution
– Concepts: Information systems and technology belong to everyone
in an organization and Information Systems serve the entire
organization
Approaches of Studying Information Systems
(Cont.)
• Management Information Systems
– Combines computer science, management science, operations
research, and practical orientation with behavioral issues
• Four main actors
– Suppliers of hardware and software
– Business firms
– Managers and employees
– Firm’s environment (legal, social, cultural context)
FIGURE: CONTEMPORARY APPROACHES TO INFORMATION SYSTEMS

The study of information systems deals with issues and insights

contributed from technical and behavioral disciplines
Source: Kenneth C Laudon, Jane P. Laudon, 2018
FIGURE: A Sociotechnical Perspective on Information Systems

In a sociotechnical perspective, the performance of a system is optimized when both the technology
and the organization mutually adjust to one another until a satisfactory fit is obtained.
Source: Kenneth C Laudon, Jane P. Laudon, 2020
Learning MIS: Develop Non-Routine Skills
Marketable Skills
• Rapid technological change and increased international
competition
– Requires skills and ability to adapt;
– Non-routine cognitive skills; e.g. able to apply creative
thinking and analytical skills in bridging theories to clarify
problem and provide solution to solve existing problem
– Four dimensions; Abstract Reason, System thinking,
Collaboration, Ability to experiment
Learning MIS: Develop Non-Routine Skills (Cont.)
Abstract Reason
• Ability to make and
manipulate models
• Learn to use and
construct abstract models

Source: David Kroenke, Randall J. Boyle, 2017

Learning MIS: Develop Non-Routine Skills (Cont.)
Systems Thinking
• Ability to model system components, connect inputs and
outputs among components to reflect structure and
dynamics
• Ability to discuss, illustrate, critique systems; compare
alternative systems; apply different systems to different
situations
Learning MIS: Develop Non-Routine Skills (Cont.)
Collaboration
• People working together to achieve a common goal,
result, or work product
• Develop ideas and plans with others
• Provide and receive critical feedback
Learning MIS: Develop Non-Routine Skills (Cont.)
Ability to Experiment
• Make reasoned analysis of an opportunity; develop and evaluate
possible solutions
• Create and test promising new alternatives, consistent with
available resources
• Consideration questions;
– “I’ve never done this before.”
– “I don’t know how to do it.”
– “will it work?”
– “Is it too weird for the market?”
Summary
Summary
• Information systems transforming business
– Using Mobile, Big data, Cloud Computing
• Information systems essential for running and managing
a business today
– Six objectives of business
• Information systems components and dimension
• Academic discipline used to study information system
– This course focus on Socio-technical approach:
combine technical and social features and solution
• Learning MIS could help you to develop Non-Routine
Skills
References
• David Kroenke, & Randall J. Boyle. (2017). Using MIS (9th ed.).
Edinburgh Gate Harlow, England: Pearson.
• Laudon, K.C., & Laudon, J.P. (2022). Management information
th
systems (17 ed.). Edinburgh Gate Harlow, London: Pearson.