Chapter

1.1 © 2007 by Prentice Hall

1Chapter

Business Business Information Systems Information Systems

in Your Careerin Your Career

Business Business Information Systems Information Systems

in Your Careerin Your Career


OBJECTIVES

Essentials of Business Information SystemsEssentials of Business Information SystemsChapter 1 Business Information Systems in Your CareerChapter 1 Business Information Systems in Your Career

• Explain why information systems are so essential in business today.

• Define an information system from both a technical and a business perspective, and distinguish between computer literacy and information systems literacy.

• Apply a four-step method for business problem solving to solve information system-related problems.


• Assess how information systems will affect business careers in accounting, finance, management, marketing, operations management, and information systems and identify the information systems skills and knowledge essential for all business careers.

OBJECTIVES (Continued)




Major League Baseball Hits a Home Run with Information Systems

• Problem: Declining revenue from traditional sales channels, declining customer base, increasing costs.

• Solutions: MLB Web sites and cell phone ticketing enable electronic ticketing and delivery of online information and games, which increase sales.

• SAS customer analysis software and Web site tracking tools help identify good sales prospects.

• Demonstrates IT’s role in reducing cost, opening new sales channels, and building community with customers.

• Illustrates the emerging digital firm landscape where businesses can use tools to analyze critical data.



Major League Baseball Hits a Home Run with Information Systems

• Visit the Major League Baseball Web site at Visit the Major League Baseball Web site at www.mlb.comwww.mlb.com

• Watch a video on the home pageWatch a video on the home page

• Subscribe to a free newsletter from the Fan ForumSubscribe to a free newsletter from the Fan Forum

• Find a jersey from your favorite team in the ShopFind a jersey from your favorite team in the Shop

• Visit the Web site of your favorite MLB teamVisit the Web site of your favorite MLB team

• How does having a central Web site run all team How does having a central Web site run all team sites help MLB? How does it hurt?sites help MLB? How does it hurt?

• What business objectives does this Web site What business objectives does this Web site serve?serve?

Interactive Session: Major League BaseballInteractive Session: Major League Baseball


The Role of Information Systems in Business Today

• In 2005, more wireless phone accounts were In 2005, more wireless phone accounts were opened than telephone land lines installedopened than telephone land lines installed

• More than 35 million people receive their news More than 35 million people receive their news online; 32 million Americans read blogsonline; 32 million Americans read blogs

• Internet advertising continues to grow at more than Internet advertising continues to grow at more than 30 percent per year30 percent per year

• New laws require businesses to store more data for New laws require businesses to store more data for longer periodslonger periods

• Changes in business result in changes in jobs and Changes in business result in changes in jobs and careerscareers

How Information Systems Are Transforming Business How Information Systems Are Transforming Business




• Operational excellenceOperational excellence

• New products, services, and business modelsNew products, services, and business models

• Customer and supplier intimacyCustomer and supplier intimacy

• Improved decision makingImproved decision making

• Competitive advantageCompetitive advantage

• SurvivalSurvival

Business Objectives of Information SystemsBusiness Objectives of Information Systems




Operational Excellence:Operational Excellence:• Improved efficiency results in higher profitability

• Information systems and technologies help to improve higher levels of efficiency and productivity

• Wal-Mart is the champion of combining information systems and best business practices to achieve operational efficiency—and $285 billion in sales in 2005

• Wal-Mart is the most efficient store in the world as a result of digital links between its suppliers and stores




• Information systems and technologies enable firms Information systems and technologies enable firms to create new products, services, and business to create new products, services, and business modelsmodels

• A business model includes how a company A business model includes how a company produces, delivers, and sells its products and produces, delivers, and sells its products and servicesservices

• The music industry has seen drastic changes in The music industry has seen drastic changes in business models in recent yearsbusiness models in recent years

• Apple has been very successful at introducing new Apple has been very successful at introducing new products and adopting a new business model products and adopting a new business model

New products, services, and business models:New products, services, and business models:




• Customers who are served well become repeat customers who purchase more

• Close relationships with suppliers result in lower costs

• The Mandarin Oriental in Manhattan uses information systems and technologies to foster an intimate relationship with its customers including keeping track of their preferences

• JCPenney uses information systems to enhance its relationship with its supplier in Hong Kong

Customer and supplier intimacy:Customer and supplier intimacy:




• A company’s bottom line can be hurt by managers being swamped with data that are neither timely nor helpful, forcing them to use guesswork

• Real-time data have improved the ability of managers to make decisions

• Verizon uses a Web-based digital dashboard to update managers with real-time data on customer complaints, network performance, and line outages

Improved decision making:Improved decision making:




• Achieving the previously mentioned business objectives often leads to competitive advantage

• Advantages over competitors include charging less for superior products, better performance, and better response to suppliers and customers

• Dell Computer is one of the best examples of establishing competitive advantage as the company has continued to be profitable during a time when PC prices have been falling steadily

Competitive advantage:Competitive advantage:




• Businesses may need to invest in information systems out of necessity

• Necessity arises from keeping up with competitors, such as when Citibank introduced ATMs

• Necessity also arises from federal and state regulations, such as the Toxic Substances Control Act and the Sarbanes-Oxley Act

Survival:Survival:



Interactive Session: Business ObjectivesInteractive Session: Business Objectives

In your experience, what firms have achieved:

Operational excellence Operational excellence New products, services, and business modelsNew products, services, and business modelsCustomer and supplier intimacyCustomer and supplier intimacyImproved decision makingImproved decision makingCompetitive advantageCompetitive advantageSurvivalSurvival

Did information systems and technologies play a role in these achievements?




Perspectives on Information Systems and Information Technology

• Information technology is the hardware and Information technology is the hardware and software a business uses to achieve its objectivessoftware a business uses to achieve its objectives

• An information system consists of components An information system consists of components that support decision making and control, and help that support decision making and control, and help with analysis, visualization, and product creationwith analysis, visualization, and product creation

• Information refers to data shaped into a meaningful Information refers to data shaped into a meaningful and useful formand useful form

• Data are streams of raw facts representing events Data are streams of raw facts representing events and occurrencesand occurrences

What Is an Information System? What Is an Information System?



Perspectives on Information Systems and Information Technology

What Is an Information System? What Is an Information System?


Activities in an information system that produce information:

•Input

•Processing

•Output

•Feedback

Think of an information system you have experienced recently. Describe the inputs, processing, outputs, and feedback in the system.


It Isn’t Simply Technology: The Role of People and Organizations

• Information systems literacy vs. computer literacyInformation systems literacy vs. computer literacy

• OrganizationsOrganizations

• PeoplePeople

• TechnologyTechnology

Dimensions of Information Systems Dimensions of Information Systems




Information Systems Are More Than Computers Information Systems Are More Than Computers


Figure 1-3

Using information systems effectively requires an understanding of the organization, people, and information technology shaping the systems. An information system provides a solution to important business problems or challenges facing the firm.



UPS Competes Globally with Information TechnologyUPS Competes Globally with Information Technology


• Read the Focus on Technology and then discuss Read the Focus on Technology and then discuss the following questions:the following questions:

• What are the inputs, processing, and outputs of UPS’s package tracking system?

• What technologies are used?

• How are these technologies related to UPS’s business strategy?

• What problems do these technologies solve?

• What would happen if these technologies were not available?


Understanding Information Systems: A Business Problem-Solving Approach

• Few business problems are simple or Few business problems are simple or straightforwardstraightforward

• Most business problems involve a number of major Most business problems involve a number of major factors that can be categorized as organization, factors that can be categorized as organization, technology, and peopletechnology, and people

The Problem-Solving ApproachThe Problem-Solving Approach




• Problem identificationProblem identification

• Solution designSolution design

• ChoiceChoice

• ImplementationImplementation

• Problem solving is a process, not an eventProblem solving is a process, not an event

A Model of the Problem-Solving ProcessA Model of the Problem-Solving Process



Problem Solving Is a Continuous Four-Step Process Problem Solving Is a Continuous Four-Step Process


Figure 1-4

During implementation and thereafter, the outcome must be continually measured and the information about how well the solution is working is fed back to the problem solvers. In this way, the identification of the problem can change over time, solutions can be changed, and new choices made, all based on experience.




• Four elements of critical thinking:Four elements of critical thinking:

• Maintaining doubt and suspending judgment

• Being aware of different perspectives

• Testing alternatives and letting experience guide

• Being aware of organizational and personal limitations

The Role of Critical Thinking in Problem SolvingThe Role of Critical Thinking in Problem Solving




• When firms cannot achieve their business When firms cannot achieve their business objectives, these objectives become challengesobjectives, these objectives become challenges

• Information systems often present solutions to Information systems often present solutions to these challengesthese challenges

The Connection Between Business Objectives, The Connection Between Business Objectives, Problems, and SolutionsProblems, and Solutions




• Success in today’s job market requires a broad set Success in today’s job market requires a broad set of skillsof skills

• Job candidates must have problem-solving skills as Job candidates must have problem-solving skills as well as technical skills so that they can carry well as technical skills so that they can carry specific tasksspecific tasks

• The service sector will account for 95 percent of the The service sector will account for 95 percent of the new jobs that are created or open up by 2012new jobs that are created or open up by 2012

Information Systems and Your Career



• AccountingAccounting

• FinanceFinance

• MarketingMarketing

• Operations Management in Services and Operations Management in Services and ManufacturingManufacturing

• Information SystemsInformation Systems

• OutsourcingOutsourcing

How Information Systems Will Affect Business CareersHow Information Systems Will Affect Business Careers



A Top Information Manager Puts Business A Top Information Manager Puts Business Before TechnologyBefore Technology


• Read the Focus on People and then discuss the Read the Focus on People and then discuss the following questions:following questions:

• What problems and challenges does Sonic face?

• How is it trying to solve these problems?

• What alternative solutions are available?

• Is CIO Mitchell Gregory a good problem solver for this company?

• Why or why not?



Interactive Session: Sonic CorporationInteractive Session: Sonic Corporation


• Visit Sonic’s Web site at www.sonicdrivein.com

• How does Sonic’s Web site enhance its business?

• Who is the target audience of the Web site? Is there more than one target audience?

• What would make the Web site better?

• How does Sonic’s Web site compare to the sites of its competitors, such as McDonald’s, Burger King, Wendy’s, Checkers, and Jack in the Box?


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