1. What is an information system?

What are some of the ways information systems are changing

our lives?

• An information system can be defined technically as a set of interrelated components that:

• input, process, output, store, and distribute information to support decision making and
control in an organization.

Customer and supplier intimacy

When a business really knows its customers, and serves them well, the way they want to be served, the
customers generally respond by returning and purchasing more. This raises revenues and profits.

Close relationships with suppliers result in lower costs.

How to really know your customers, or suppliers, is a central problem for businesses.

IS has a vital role in solving this problem.

Note:

You can write any other example.

2. How would you distinguish data and information?

3. Identify at least six characteristics of valuable information.

 Information should be available when required.
 Information should be accurate
 Information should be complete.
 Relevance: Valuable information should be relevant
 Valuable information should be authentic
 Valuable information should be accessible
4. What is the difference between efficiency and effectiveness?

efficiency as doing things right

effectiveness as doing the right things.

 5. What are the components of any information system?

Computer hardware

This is the physical technology that works with information

Computer software

The hardware needs to know what to do, and that is the role of software.

Telecommunications

This component connects the hardware together to form a network.

Databases and data warehouses

This component is where the “material” that the other components work with resides.

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.

.6. What is feedback? What are possible consequences of inadequate feedback?

 feedback, which is output that is returned to appropriate members of the organization to help
them evaluate or correct the input stage.
 including lack of improvement, miscommunication, decreased motivation, inefficient use of
resources, and negative impact on relationships.

7. How is system performance measured?

In general, performance can be evaluated based on metrics such as speed, accuracy, efficiency,
scalability, reliability, availability, and security.

8. What is knowledge management?

the process of capturing, creating, sharing, using, optimizing, and managing information, insights, and
knowhow in an organization.

9. What is a computer-based information system? What are its components?

is essentially an IS using computer technology to carry out some or all of its

planned tasks. The basic components of computer-based information system
are:

Hardware– these are the devices like the monitor, processor, printer and keyboard, all of which work
together to accept, process, show data and information.
Software– are the programs that allow the hardware to process the data.
Databases– are the gathering of associated files or tables containing related data.
Networks– are a connecting system that allows diverse computers to distribute resources.
Procedures– are the commands for combining the components above to process information and produce
the preferred output.
10. What is the difference between an intranet and an extranet?

An intranet is a private local network that enables employees within an organization to create content,
communicate, and collaborate.

An extranet is a controlled access private network that provides authorized customers, vendors, and
partners access to certain parts of the internal network.

11. What are the major business objectives of information systems?

organizations invest in information systems to achieve six strategic business objectives: (1) achieve
operational excellence; (2) create new products, services, and business models; (3) improve customer
and supplier intimacy; (4) improve decision-making; (5) establish competitive advantage; and (6) survive.

12. Explain Michael Porter’s competitive forces model.

Traditional Competitors All firms share market space with other competitors who are continuously
devising new, more efficient ways to introduce new products and services, and attempting to attract
customers by imposing switching costs on their customers.

New Market Entrants

In a free economy, new companies are always entering the marketplace.

It is fairly easy to start a pizza business, but it is much more expensive and difficult to enter the computer
chip business. But in both cases new market entrants are considered to be a major force of effecting your
firm.

Substitute Products and Services In just about every industry, there are substitutes that your customers
might use if your prices become too high. New technologies create new substitutes all the time. Internet
telephone service can substitute for traditional telephone service, And, of course, an Internet music
service that allows you to download music tracks to an iPod is a substitute for CD-based music stores.
The more substitute products and services in your industry, the less you can control pricing and the
lower your profit margins.

Customers profitable company depends in large measure on its ability to attract and retain customers
(while denying them to competitors). The power of customers grows if they can easily switch to a
competitor’s products and services.

Suppliers The power of suppliers can have a significant impact on firm profits, especially when the firm
cannot raise prices as fast as can suppliers. The more different suppliers a firm has, the greater control
it can exercise over suppliers in terms of price, quality, and delivery schedules. For instance,
manufacturers of laptop PCs always have multiple competing suppliers of key components, such as
keyboards, hard drives, and display screens.

13. How a firm deal when it is faced with competitive forces?

-Low-Cost Leadership
Use information systems to achieve the lowest operational costs and the lowest prices.

-Product Differentiation

Use information systems to enable new products and services or greatly change the customer
convenience in using your existing products and services.

-Focus on Market Niche

Use information systems to enable a specific market focus and serve this narrow target market better
than competitors.

- Strengthen Customer and Supplier Intimacy

Use information systems to tighten linkages with suppliers and develop intimacy with customers.

14. What are the Dimensions of Information Systems?

People

Information systems are useless without skilled people to build and maintain them, and without people
who can understand how to use the information system to achieve business objectives.

Business firms require many different kinds of skilled people.

Management: The job of management has been transformed by information systems, and it is difficult to
manage business firms today without the extensive use of information systems, from desktop
productivity tools to applications coordinating the entire enterprise.

Organizations

• In order to understand how a specific business firm uses information systems, you need to know
about the structure and culture of the company.

• Organizations have a structure that is composed of different levels and specialties.

• Information systems are built by the firm in order to serve these different specialties and
different levels of the firm.

• An organization accomplishes work through its business processes, which are logically related
tasks and behaviors for accomplishing work. Developing a new product, fulfilling an order, or
hiring a new employee are examples of business processes.

• Information systems automate many business processes. For instance, how a customer receives
a loan or how a customer is billed.

Technology

• Information technology is the hardware, software and networking technology a business uses to
achieve its objectives
• Computer hardware is the physical equipment used for input, processing, and output activities in
an information system.

• Computer software consists of the detailed programs (preprogrammed instructions) that control
the computer hardware components in an information system.

• Networking and telecommunications technology, consisting of both physical devices and

software, links the various pieces of hardware and transfers data from one physical location to
another.

15. State 3 types of Networks.

 Local Area Network (LAN)

 Small network

 Usually confined to a building or an office floor

 Wide Area Network (WAN)

 Two or more LANs connected together

 Metropolitan Area Network (MAN)

 Covers a large area, such as a city