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Information Systems Defined

Basic definitions and foundational Information Systems concepts

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Course Roadmap

• Part I: Foundations– Chapter 1: Introduction– Chapter 2: Information Systems Defined– Chapter 3: Organizational Information Systems and

Their Impact

• Part II: Competing in the Internet Age• Part III: The Strategic use of Information Systems• Part IV: Getting IT Done

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Learning Objectives

1. The definition of information system (IS) and information technology (IT) and the difference between the two.

2. The definition of information system success and information system failure.

3. The principal reasons why modern firms create and deploy information systems.

4. The influence of the firm’s context and the external environment in which it is embedded on organizational information systems.

5. The four components that make up an information system and the manner in which they interact.

6. How to design successful information systems and how to troubleshoot problematic information systems implementations.

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Information System: Definition

Formal, socio-technical, organizational systems designed to collect, process,

store, and distribute information

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Formal vs. Informal

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IS ≠ IT

• Opened: 1907

• First implementation of computers in hospitality: New York Hilton, 1963

• Did they have an Information System in 1907?

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The Four Components of an Information System

• IT

• Process

• People

• Structure

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Value to Managers

• A solid understanding of the characteristics of each of the four components

• An appreciation of how they relate and interact with one another

• Appropriate business decisions as a general or functional manager

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Information Technology Component

• Hardware– Computer, cell phone

• Software– Microsoft Office

• Telecommunication equipment– Internet

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Don’t Forget!

• The design of IT enables and constrains the behavior of the Information System

Software, particularly a custom developed application, is an

opinion of how data should be represented, organized, and

manipulated

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Process Component

• The series of steps necessary to complete a business activity

• Examples:– Check-in at a hotel – Credit approval at a bank– Materials receiving at a warehouse

• There are multiple ways to perform an activity: Every process is designed.

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Don’t Forget!

Official business process

Informal process

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People Component

• Those individuals or groups directly involved in the information system– End-users– Managers

• Their needs are a critical concern in designing and implementing a new Information System

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Structure Component

• The organizational structure component (structure for short) encompasses: – The organizational design

• Hierarchy, decentralized, loose coupling

– The reporting configuration• Functional, divisional, matrix

– The organizational relationships • Communication and reward mechanisms• Culture

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Systemic Effects: Components Working Together

• The four components of an Information System are Interdependent

• Changes in on component may affect all others

• Success is based on the proper interaction of IT with the other components

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The Purpose of Information Systems

• Fulfilling organizational processing needs

• Improve efficiency and effectiveness

• Achieve a (specified) Information System goal.

• Example: Grocery store– To increase the efficiency and speed of

customer check-out by using self-check out stations.

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Information Systems Success

• Has the system delivered expected results?

• What are some of the unintended results?– Positive– Negative

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IS Success is often Elusive

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Don’t Forget!

• Every organization is unique

• Even fierce competitors often have different:– Firm strategy: The manner in which the

organization intends to achieve its objectives.– Firm culture: The collection of beliefs,

expectations, and values shared by the members of an organization.

– Infrastructure: The technological backbone of the firm. It constrains and enables opportunities for future information systems projects.

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External Environment

• External environment: – The legal and regulatory context– The competitive landscape– The general business and social trends

surrounding the organization

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Bringing it all Together: Information Systems in Context

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Information Systems and Organizational Change

First Order Change:

Automate

Second Order

Change: Informate

Third Order Change:

Transform

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First Order Change: Automate

• First order change only affects the technical subsystem

• Thus, it is:– Easiest to envision– Easiest to justify– Easiest to manage.

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Second Order Change: Informate

• Second order change affects the people component

• It thus provides more of a challenge to implementation

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Third Order Change: Transform

• Third order change affects organizational structures

• It seeks to transform how the organization operates

• It requires significant managerial and executives’ involvement

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Implications

• IT should NOT be the start of your Information System design process– Strategy may be inspired by IT but– IT selection is a point of arrival not departure

• Never forget Systemic Effects• Optimize the Information System as a

whole, not the components individually• Organizations are dynamic, re-evaluate

often

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What we Learned

1. The definition of information system (IS) and information technology (IT) and the difference between the two.

2. The definition of information system success and information system failure.

3. The principal reasons why modern firms create and deploy information systems.

4. The influence of the firm’s context and the external environment in which it is embedded on organizational information systems.

5. The four components that make up an information system and the manner in which they interact.

6. How to design successful information systems and how to troubleshoot problematic information systems implementations.