EM4218E - MANAGEMENT INFORMATION SYSTEMS

CHAPTER 1 –
Information Systems in Global Business Today

EM4218E @ Asst. Prof. Dr. Jiayu Yao 1

LEARNING OBJECTIVES

1. How are information systems transforming business, and why are they so essential for
running and managing a business today?
2. What is an information system? How does it work? What are its management,
organization, and technology components? Why are complementary assets essential for
ensuring that information systems provide genuine value for organizations?
3. What academic disciplines are used to study information systems, and how does each
contribute to an understanding of information systems?

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CONTENT

1.1. Information Society Evolution

1.2. Definition of Information System
1.3. Information System Components
1.4. MIS and Your Career

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1.1. Information Society Evolution | Periods of Change

Agricultural Industrial Informational

(Prior to 1890’s) (1890’s to 1960’s) (1960’s to Present)

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1.1. Information Society Evolution | Information Technology Capital Investment

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1.1. Information Society Evolution | Internet Access in Vietnam

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1.1. Information Society Evolution | What’s New in Management Information Systems?

Five prominent changes

• IT Innovations
• Cloud computing, mobile digital business platform based on smartphones and tablet computers, big data and the Internet
of Things (IoT), business analytics, machine learning systems, and social networks
• New Business Models
• Online video services for streaming or downloading, such as Netflix, Apple TV Channels, and Amazon
• E-commerce Expansion
• Social networking sites such as Facebook, YouTube, Twitter, and Tumblr, along with Netflix, Apple Music, and many
other media firms
• Management Changes
• Management is going mobile
• Will the coronavirus pandemic make working from home the new normal?
• Changes in Firms and Organizations
• Less emphasis on hierarchy and structure and more emphasis on employees taking on multiple roles and tasks and
collaborating with others on a team

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1.1. Information Society Evolution | Globalization Challenges and Opportunities

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1.1. Information Society Evolution | Strategic Business Objectives of Information Systems

• Organizations and Information Systems

• Video Lecture Figure 1.2

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In-class Group Discussion: Smart Stores Reinvent the Retail Space

Although there has been an upsurge in online shopping, retail stores are not going away. Some traditional retailers are fighting back by using information technology
to provide new ways to bring people into physical stores or enhance their in-store experiences, even with new requirements for social distancing.
Acrelec, a French digital signage company, is piloting technology to help retailers manage store curbside pickups by customers placing orders online. Customers can
use a retailer’s smartphone app to indicate they are coming to pick up an order, and the Acrelec system will estimate when a customer will arrive at a particular store.
Object-recognition cameras identify exactly when a customer’s car arrives and where it is parked. Acrelec is especially useful for big-box retailers, grocery stores, and
home-improvement stores.
Shelves have become more than just a surface for storing and displaying objects. New systems for “smart” shelves use proximity sensors, 3D cameras, microphones,
RFID readers, and weight sensors to enable interactions between shoppers in physical stores and the shelves they’re standing in front of. These systems can create a
highly personalized shopping experience that fundamentally improves the way shoppers move inside physical stores.
Brands and retailers such as Pepsi, Walmart, and Albertsons are starting to use Smart Shelf by AWM to replicate the benefits of the online experience in physical retail
environments. Using super-wide-angle low-light HD cameras, retailers deploying Smart Shelf are able to view and track their products in real-time. The solution
improves operational efficiencies by highlighting specific shelves that need product stocking and allows for realtime on-shelf marketing to consumers. When retailers
connect Smart Shelf to their mobile apps, they can help shoppers locate products themselves through their smartphones and tablets.
AWM Frictionless is a walk-in, walk-out solution enabling customers to shop as normal and check out by simply exiting the store. The system uses digital shelving
and object-recognition cameras to keep track of which customers leave with which items. When customers enter a store, they are required to have mobile device and
facial recognition scans, which allow the system to charge their digital accounts when they leave with purchases and receive a receipt via email or text message.
In March 2020 AWM opened a low-contact cashierless micromarket called QuickEats at a luxury apartment community owned by Greenwood & McKenzie in Santa
Ana California. QuickEats utilizes AWM Frictionless and features grab-and-go products such as sodas, water, juice drinks, sandwiches, cheese plates, fruit, and
household cleaning items.
AWM Smart Shelf is able to personalize shoppers’ experiences when they are in stores based on the items they pick up, even if they don’t purchase them. For
example, if a customer picks up a box of cookies and then puts it back, the retailer can use the system to offer a discount on the shelf beneath that item the next time
the shopper encounters it in the store. Cofounder Kurtis Van Horn believes that Smart Shelf can provide the same level of customization and personalization as found
in online shopping to brick-and-mortar stores.
AWM also offers an anonymous consumer behavior tracking application that can direct customers to other parts of a store using digital signage, enabling up-to-the-
minute advertising and pricing. AWM solutions can be implemented in a wide range of store sizes and formats, from micromarkets, to convenience stores, to larger-
format retailers. Technology is redefining the role of the shelf in retail marketing.

EM4218E @ Asst. Prof. Dr. Jiayu Yao 10

In-class Group Discussion: Smart Stores Reinvent the Retail Space

Example of Amazon Go

EM4218E @ Asst. Prof. Dr. Jiayu Yao 11

In-class Group Discussion: Smart Stores Reinvent the Retail Space

EM4218E @ Asst. Prof. Dr. Jiayu Yao 12

In-class Discussion

Why are IS systems so essential for running and managing a business today?
• operational excellence
• new products, services, and business models
• customer and supplier intimacy
• improved decision making
• competitive advantage
• survival

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CONTENT

1.1. Information Society Evolution

1.2. Definition of Information System
1.3. Information System Components
1.4. MIS and Your Career

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1.2. Definition of Information System

Technology: any mechanical and/or electrical means to supplement,

extend, or replace human manual operations
Examples: building heating/cooling systems, car brakes, etc.

Information Technology: consists of all the

hardware and software that a firm needs to use in
order to achieve its business objectives.
Example: a programmable industrial robot receiving
instructions from a computer-based database

Information Systems: a set of interrelated components that collect

(or retrieve), process, store, and distribute information to support decision
making and control in an organization
Example: Software that controls CD burning hardware
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 1.2. Definition of Information System | Turn Data into Information

Streams of raw facts Data that have been

representing events shaped into a form
occurring in that is meaningful
organizations or the Data Information and useful to human
physical environment • Raw material • Processed material beings.
• Unformatted information • Formatted information
• Generally has no context • Data given context

Individual timecards for Examples Department Labor Report,

factory workers entered the Project Status Report,
payroll system Employee Payroll Checks

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1.2. Definition of Information System | Turn Data into Information

• Data and Information

• Video Lectures Figure 1.3

• Functions of Information Systems

• Video Lectures Figure 1.4

EM4218E @ Asst. Prof. Dr. Jiayu Yao 17

1.2. Definition of Information System | Dimensions of Information Systems

• Computer hardware
• Computer software – Chapter 5
• Data Management Technology – Chapter 6
• Networking and telecommunications
technology – Chapter 7

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1.2. Definition of Information System | A Business Perspective on Information Systems

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1.2. Definition of Information System | A Business Perspective on Information Systems

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1.2. Definition of Information System | Complementary Assets

Variation in Returns on IT Investment

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1.2. Definition of Information System | Complementary Assets

• Complementary assets
• Assets required to derive value from a primary
investment (Teece, 1998)

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1.2. Definition of Information System

MIS - Management Information Systems:

the management and use of processes, information systems, and information to help organizations achieve
their strategies.
This definition has three key elements:
• Processes, information systems, and information
• Process - a business process, is a way of doing something. The process involves finding potential
customers, contacting them, assigning a salesperson, and so forth. Because organizations accomplish
work via processes, focusing on them is key to improving organizational effectiveness and efficiency.
• An information system is a collection of components, including but not limited to a computer, that
stores and retrieves data and produces information.
• Information is a meaningful insight that helps employees do their jobs
• Management and Use
• Achieve strategies

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CONTENT

1.1. Information Society Evolution

1.2. Definition of Information System
1.3. Information System Components
1.4. MIS and Your Career

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1.3. Information System Components

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1.3. Information System Components

Approach of this class: sociotechnical systems

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1.3. Information System Components

People
People

- A combination of technical components

- Built and used by people to collect, create, and distribute useful data
- Used typically in organizational settings but are evolving for personal use

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1.3. Information Systems Components | Data

Data
Data People
People

Information
Information
Systems
Systems

Hardware
Hardware Telecommunications
Telecommunications

Software
Software

• The raw inputs for entry into information systems

• Organized, processed and stored by an IS to support user
information needs
• Provides basis for qualitative/quantitative analysis

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1.3. Information Systems Components | Hardware

Data
Data People
People

Information
Information
Systems
Systems

Hardware Telecommunications
Telecommunications
Hardware

Software
Software

• The physical components of information systems

• Hardware components include processors, input and output devices,
and storage devices
• Typical configurations based on application include micro, mid-range,
mainframe, and super computers

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1.3. Information Systems Components | Software

Data
Data People
People

Information
Information
Systems
Systems

Hardware Telecommunications
Telecommunications
Hardware

Software
Software

• The instructions that operate the information system

• System software controls the hardware (WindowsXP)
• Application software allows user tasks to perform specific tasks to
increased productivity (MS Word)

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1.3. Information Systems Components | Telecommunications

Data
Data People
People

Information
Information
Systems
Systems

Hardware Telecommunications
Telecommunications
Hardware

Software
Software

• The communication mechanism of information systems

• Allows two or more computers to communicate (Internet)
• Utilizes standard protocols for IS communication

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CONTENT

1.1. Information Society Evolution

1.2. Definition of Information System
1.3. Information System Components
1.4. MIS and Your Career

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1.4 Typical Careers in Information Systems

Careers in information systems require high

technical competence and generally pay well

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1.4 Executive Roles in Information Technology

• Manages External
Stakeholder Relationships
• Sets Strategic Direction CEO
• Defines High Level IT Chief Executive
Needs for the Future Officer

COO CFO CIO

Chief Operations Chief Financial Chief Information
Officer Officer Officer

• Manages Operations • Manages Accounting & Finance

• Allocates Resources • Forecasts Needs and Secures Financial
• Primary Consumer of IT Resources
within the Organization • Allocates Budget for IT Expenditures

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Executive Roles in Information Technology

CEO
Chief Executive
Officer

COO CFO CIO

Chief Operations Chief Financial Chief Information
Officer Officer Officer

• Manages IT Organization and Operations

• Forecasts IT Needs from Business Strategy
• Sets Direction for IT Architecture and Organization
• Plans, Designs and Delivers IT throughout the firm

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Three Distinct Competencies of IS Professionals

Technical
Technical
•• Knowledge
Knowledgeof ofhardware,
hardware,software,
software,networking,
networking,and
andsecurity
security
•• Most
MostISISprofessionals
professionalsare
arenot
notdeep
deeptechnical
technicalexperts
expertsbut
butcan
can
direct/manage
direct/manageothers
otherswith
withthe
therequired
requiredtechnical
technicalskills
skills

Business
Business
•• Understand
Understandthethenature
natureof
of business
businessincluding
includingprocess,
process,
management,
management,social,
social,and
andcommunication
communicationdomains
domains
•• Unique
Uniqueskills
skillsover
overthose
thosewith
withonly
onlytechnical
technicalskills
skills

Systems
Systems
•• Knowledge
Knowledgeof ofapproaches
approachesand andmethods,
methods,also
alsopossess
possesscritical
critical
thinking
thinkingand
andproblem
problemsolving
solvingskills
skillsnecessary
necessarytotobuild
buildand
and
integrate
integratelarge
largeinformation
informationsystems
systems
•• Unique
Uniqueskills
skillsover
overthose
thosewith
withonly
onlytechnical
technicalskills
skills

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In-class Group Discussion

• Visit a job-posting website such as Linkedin.com.

• Look for some jobs on accounting, finance, sales, marketing, and human resources.
• Find two or three descriptions of jobs that require some information systems knowledge.
• What information systems knowledge do these jobs require? What do you need to do to
prepare for these jobs?

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LEARNING OBJECTIVES

1. How are information systems transforming business, and why are they so essential for
running and managing a business today?
2. What is an information system? How does it work? What are its management,
organization, and technology components? Why are complementary assets essential for
ensuring that information systems provide genuine value for organizations?
3. What academic disciplines are used to study information systems, and how does each
contribute to an understanding of information systems?

39
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