Fall 2023

Chapter 2: Business Processes, Information Systems, and Information

Sirine Taleb
Slides: From Pearson Book
9/12/23
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Q2-2 How can Business Process Modeling help Organizations?

§ Operations will need to decide whether to 3D print a part manufactured in-

house
§ Uses process diagrams to communicate process structure and possible
changes, additional personnel needs

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Q2-2 How can Business Process Modeling help Organizations?

Figure 2-3 Revised Best Bikes Business

Process Using BPMN

• Figure 2-3 shows need to

further define the
subprocesses Make the
Product and Check Product
Quality.

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Q2-3 How can information systems improve process quality?

§ What is process quality?

§ Process quality can be measured in two dimensions: process effectiveness and
process efficiency.
§ Current processes do not support 3D printing
§ Efficiency → ratio of benefits to costs
§ Consider two versions of a business process for accomplishing some function. If both versions
create the same benefit, but one costs more than the other does, then the higher-cost version is
less efficient than the lower-cost version. Or if both versions cost the same, but one generates less
benefit than the other, then the lower-benefit one is less efficient.
§ Effectiveness → enables organization to accomplish strategy
§ One element of Best Bikes’ strategy is to have the largest selection of parts in the industry. It is
investigating whether 3D printing will help accomplish that strategy.

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Q2-3 How can information systems improve process quality?

§ Two different repositories of vendor data. One is used by Buyers to select

vendors, and another is used by Operations to store order data. Such separated
data may be appropriate, but more likely it is creating process inefficiencies.
§ For example, what happens when a vendor moves? The vendor’s address needs to
be updated in two places; duplicate updating isn’t difficult, but it is unnecessary.
§ Further, consider the confusion if the vendor address is changed in one place but
not the other.

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 BEST BIKES BUSINESS PROCESS WITH
SINGLE VENDOR REPOSITORY
Q2-3 How can information systems improve process quality?

Figure 2-4 Best Bikes Business Process with Single Vendor

Repository

More
EFFICIENT!
Single repository less costly,
generate fewer errors, and as
effective

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Q2-3 How can information systems improve process quality?

§ BPMN doesn’t show costs directly

§ Cost is labor to perform activity (by employees)
§ Computer network, email, or other system needed to support data flows
§ Cost of infrastructure part of business process costs. Use an Information System
to Store Vendor Data.

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Q2-3 How can information systems improve process quality?

Figure 2-5 Characteristics of the Five Components

• Software is instructions
for hardware and
procedures are
instructions for people.

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Q2-3 How can information systems improve process quality?

Examples of Automation:
- Select Vendor Product Activity:
That process could be entirely manual. (by hand – on paper)
One way to use information systems in this process would be for buyers to store the
results of vendor analyses in an Excel file.
If this were done,
§ the buyer would have a faster and more reliable means of finding relevant data.
§ the time required to perform the analysis and locate past analyses reduced,
§ the cost of the process would decrease,
§ the process would be more efficient,
§ and hence process quality would increase.

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Q2-3 How can information systems improve process quality?

Examples of Automation:
- Store Vendor Product and Performance Data in a Database:
- Assuming single vendor repository scenario
- Now buyers can not only use their own data about vendors and products, but they
also can view past vendor performance data to choose among vendors when parts
are available from several vendors.

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 Assuming single vendor
repository scenario
Q2-3 How can information systems improve process quality? (Figure 2-4)
Figure 2-6 Best Bikes Data on General Sports
General Sports frequently ships fewer
items (Quantity Received) than were
requested (Quantity Ordered), and in
one case, it shipped too many parts. In
addition, Best Bikes received many items
in damaged condition.
versus

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 Q2-3 How can information systems improve process quality?

A process that uses this new information system saves buyer labor and, on the surface, is more
efficient.
But the new information system will cost something to develop and operate.
Those costs must also be considered before the organization can decide if making such a change
makes the process more efficient.
• By the way, you can see from this simple example why it is vital that business professionals
be involved in the development of information systems. If systems development is left
solely to technical personnel, they may develop a system that is technically elegant but
with costs that cannot be justified.

What about effectiveness?

Think about identifying new parts to buy from vendors!
If Best Bikes can find another vendor (other than General Sports) to supply these or equivalent parts,
its parts availability will increase and it will better achieve its strategy èmore effective.

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§ Next?
§ What is information?

§ Were the information/data shared about best bikes and vendors correct?

§ One needs to understand the factors that lead to quality information; to do that, one first needs to understand
the difference between information and data.

INFO 200 – AUB – Fall 2023 – Sirine Taleb 9/12/23 13

Q2-4 What is information?

Definitions vary:
1. Knowledge derived from data.
Data are recorded facts or figures.

Example:
The facts that employee James Smith earns $70.00 per hour and that Mary Jones
earns $50.00 per hour are data. The statement that the average hourly wage of
all the graphic designers is $60.00 per hour is information. Average wage is
knowledge derived from the data of individual wages.

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Q2-4 What is information?

Definitions vary:
2. Data presented in a meaningful context.

Example:
The fact that Jeff Parks earns $30.00 per hour is data.
What is the information then?

The statement that Jeff Parks earns half the average hourly
wage of the graphic designers, however, is information. It is
data presented in a meaningful context.
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Q2-4 What is information?

Definitions vary:
1. Knowledge derived from data.
2. Data presented in a meaningful context.
3. Processed data, or data processed by summing, ordering, averaging,
grouping, comparing, or similar operations.
§ The fundamental idea of this definition is that we do something to data to produce information.
4. “A difference that makes a difference.”

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Q2-4 What is information?

§ Graph is not, itself, information

§ Graph is data you, and others, use to conceive information
§ In short, if it’s on a piece of paper or on a digital screen, it’s data. If it’s in the mind of
a human, it’s information.
§ Information is created in your mind, which explains why you are the most important
part of any information system you use.

§ Ability to conceive information from data determined by cognitive skills

§ People perceive different information from same data

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AMAZON.COM STOCK PRICE AND NET
INCOME
Q2-4 What is information?

Figure 2-9 Amazon.com Stock Price and Net Income

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§ Does a graph contain information?
§ Ifit shows a difference that makes a difference or if it presents data in a meaningful
context, then it fits two of the definitions of information, and it’s tempting to say the graph
displays information.

§ Information is created in your mind, which explains why you are the most important part
of any information system you use.

§ Data is just the data; the information you conceive from it is the value that you add to the
information system.

INFO 200 – AUB – Fall 2023 – Sirine Taleb 9/12/23 19

§ You cannot say to someone, “Look, it’s right there in front of you, in the data” because it’s
not right there in the data. Rather, it’s in your head, and your job is to explain what you
have conceived so that others can understand it.

§ Some kinds of common sentences make no sense. “I sent you that information” cannot be
true. “I sent you the data, from which you conceived the information” is the most we can
say.

INFO 200 – AUB – Fall 2023 – Sirine Taleb 9/12/23 20

Q2-5 What data characteristics are necessary for quality information?

§ Accurate (When you use a new information system, be sceptical. Cross-check

the data you receive.)
§ Timely (A monthly report that arrives 6 weeks late is most likely useless. )
§ Relevant
§ To context (CEO does not need per employee hourly wage data)
§ To subject (15 years mortgage interest rate is irrelevant if you need short
term interest rate)
§ Just sufficient (you have to decide what data to ignore!)
§ Worth its cost

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§ Helps you by:
§ Enabling you to communicate effectively with IS professionals and colleagues
§ Demonstrating your ability to use systems thinking, abstraction, collaboration,
and experimentation skills
§ Enabling you to document business processes
§ Furthering your career prospects

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§ Quiz time!

INFO 200 – AUB – Fall 2023 – Sirine Taleb 9/12/23 23

So What?

§ How can HoloLens change collaboration and business?

§ Identifying industries that might benefit from augmented reality technology.
How so?
§ What is the difference between the Oculus Rift (VR) and the Microsoft
HoloLens?
§ How could this type of technology benefit students? (with colleagues or
instructors)
§ What about privacy concerns?

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So What?

§ Detailed holograms of remote users were created in a separate physical space

using Hololens and several 3D cameras. Users were able to speak and interact
with each other as if they were standing face to face. They walked around
common objects and even gave each other a high-five!

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So What?

§ Installing a light switch may be a relatively simple task

for some people. But what does this basic demonstration mean for the future of
collaboration? Could experts from around the world holoport in to solve
important business problems?
§ Could holoportation mean the end of commuting to work?
§ Think about healthcare application!
§ Think about operations in manufacturing facility!

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