Unit 403: MIS Workshop 1: IBBM CBS MBA August 2014
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Transcript of Unit 403: MIS Workshop 1: IBBM CBS MBA August 2014
Unit 403: Managing Informa2on Systems
Sweta Sud Chifley Adjunct Fellow
Know your facilitator • Instrumentation and Controls Engineer • MBA in Systems and Marketing • Master Project Manager • Post Graduate Diploma in IT Management • Certified Information Systems Auditor • Managed MIS Projects for ü GM-Opel Astra (Holden) Car Manufacturing Automation Plant ü Tata Indica, NANO (TELCO) Manufacturing Plant ü Shopfloor Information Management Systems ü Dubai Duty Free Transaction System ü Dubai Municipality ü SAP India, Singapore, Thailand, Taiwan, Indonesia Integration ü ABB Sydney – Electrical Plants Automation Projects
MIS
What Business are you in?
Why MIS?
In this Unit.. Week 1
• First workshop • Topic 1,2,3
Week 2 • Read the Study guide • Read the e-‐book
Week 3 • 2nd workshop • Topic 4,5,6
Week 4 • Do the assignment
Week 5 • 3rd workshop • Topic 7,8,9,10
Week 6 • Exam on 4th September
Today’s Agenda
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• Starts 08:30 am • MIS – your understanding • Ac2vi2es and discussions • Morning tea@10:00
1 • Managing IS to seize new strategic opportuni2es • Lunch @ 12:30pm – 01:30 pm
2 • Case Study Discussion 2me 1:30 to 02:00 pm • Managing using a systems approach • Evening Tea@ 2:30pm
3 • Informa2on systems and strategy • Session closes 04:00 pm
Unit-403, Workshop1
E-‐BOOK Managing and Using Information Systems: A
Strategic Approach
by Keri Pearlson & Carol Saunders
Roman Empire
Mughal Empire
Renaissance
OXoman Empire
Social Developent Index
Ibraham
Buddha
Confucius
Plato
life of alexander
Jesus
Zero
Mohammad`
Black Death
Columbus
Calculus
World popula2on ‘000
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What’s the most significant event in Human History
What do future Jobs look like
Customer Service Vs. Siri
Machines replacing skills
More output at lower costs
Google chairman predicts the whole world will be on the Web by 2020. CNN June 2013
"For every person online, there are two who are not," Eric Schmidt
Major shies in the demand for skills Economy-‐wide measures of rou2ne and non-‐rou2ne task input (US)
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1960 1970 1980 1990 2002
Rou2ne manual
Nonrou2ne manual
Rou2ne cogni2ve
Nonrou2ne analy2c
Nonrou2ne interac2ve
(Levy and Murnane, 2010)
Mea
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Dilemma facing schools: The skills that are easiest to teach and test are also the ones that are easiest to digi?se, automate and outsource
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TOPIC 1: Managing IS to seize new strategic opportuni2es
Analyse the impact that IS has on organisa2ons and the consequent changes that have occurred to the role of business managers.
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Objec2ve
1. Explain why managing informa2on is important in today's business world
2. Define concepts from the hierarchy of data and IS, as dis2nct from IT
3. Describe the major challenges facing today's business and IS manager
4. Analyse and report on an organisa2on's IT-‐investment profile
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A Business View
• IT is a cri2cal resource. • IT is over 50% of capital goods dollars spent in the US. – Over $3,800 a year per capita. – High growth firms invest more in IT.
• Business managers decide resource alloca2on.
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Par2cipa2ng in Informa2on Decisions
• Business managers “must” be involved in informa2on decisions.
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Par2cipa2ng in Informa2on Decisions
• Business managers “must” be involved in informa2on decisions.
• . IS … – is a cri2cal resource. – enables change in how people work together. – is integrated with almost every aspect of business. – enables business opportuni2es and new strategies. – can be used to combat business challenges from
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People and Technology
• People and Technology work together. – Technology is cri2cal. – Workers rely heavily on technology.
• Managers must know how to mesh both. – Examine long-‐term and short-‐term consequences. – Manage change carefully.
• Technology changes rapidly.
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Is IT a cost centre? Can IS create new strategic Business Opportuni2es? (Apply product vs. market Matrix
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Business Goals
• IS must support business goals. – It is not an end but a means to an end. – Support and strategic focus.
• Toys R Us IT debacle. – Must meet user needs. – Must be able to support business transac2ons.
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Organiza2onal Systems
• IT must support organiza2onal systems – The people, work processes, and structure.
• Carefully consider the consequences of making an IS change. – How will this impact the way work is done? – Will the people accept this new technology? – What changes may need to be made in the structure of the organiza2on?
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WHAT SKILLS ARE NEEDED TO PARTICIPATE EFFECTIVELY IN INFORMATION TECHNOLOGY DECISIONS?
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Basic Skills Needed
• Myth -‐ technical exper2se is not needed to par2cipate.
• Managerial role and skills needed (Fig I.2): – Visionary – crea2vity, curiosity, confidence, focus on business solu2ons, flexibility.
– Informa2onal and Interpersonal – communica2on, informa2on gathering, interpersonal skills.
– Structured – project management, analy2cal skills, organiza2onal skills, planning skills.
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BASIC ASSUMPTIONS • Managers must know about both using and managing informa2on.
• Managers must be knowledgeable par2cipants in IS decisions. – The general manager must have a basic understanding of the business and technology issues related to IS.
• Technology of today is different from the technology of yesterday.
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• The role of the general manager and IS manager are dis2nct. – The GM must have a basic understanding of IS to make decisions that may have significant implica2ons for the business.
– The IS manager must have general business knowledge and a more in depth knowledge of IS to support its func2on.
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Management Assump2ons
• Four key ac2vi2es of the classic view of management (Fig I.3). – Planning – Organizing – Leading – Controlling
• Classic view is seen as more of a tac2cal approach to management.
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• The Mintzberg model describes management in behavioral terms (Fig I.4 – page 25). – Interpersonal – Informa2onal – Decisional
Mintzberg Model
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Figure I.5 Hierarchical View of the firm.
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Func2onal View
• Func2onal View of the business – Based on the func2ons people perform. – Informa2on flows ver2cally in the organiza2on. – Some2mes informa2on flows across the organiza2on.
– Accoun2ng, Opera2ons, Marke2ng, Sales and Support.
– Execu2ve Management receives the informa2on and distributes as need arrives.
– See Figure I.5
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Figure I.6 Process View of the Firm: The Value Chain
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Process View • This model sees the business by the processes it performs to achieve its goals.
• Porter describes business in terms of its primary and support ac2vi2es. – Primary – inbound and outbound logis2cs, opera2ons, marke2ng and sales.
– Support – HR, technology, procurement, infrastructure.
• Ac2vi2es are linked together to form a chain – the value chain (fig I.6).
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Data Hierarchy
Wisdom
Understanding
Knowledge
Informa2on
Data
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Informa2on Hierarchy
• Data, Informa2on, and Knowledge are not interchangeable terms. – Data – set of specific objec2ve facts or observa2ons (inventory contains 100 widgets).
– Informa2on – data endowed with relevance and purpose (75% of widgets were purchased by customers in December) – see fig I.8.
– Knowledge -‐ informa2on that has been synthesized and contextualized to provide value.
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Data Information Knowledge
Definition Simple Observations of the sate of the world
Data endowed with relevance and purpose
Info from the human mind (includes reflection, etc)
Characteristic • Easily structured • “ captured • “ transferred • Often quantified • Mere facts
• Requires unit of analysis • Data that has been processed • Human mediation necessary
• Hard to structure • Difficult to capture on machines • Often tacit • Hard to transfer
Example Daily inventory reports of all inventory items sent to CEO of large manufacturing company
Daily inventory report of items below economic order quality levels sent to inventory manager (IM)
IM knows which items need to be reordered in light of related potential problems
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Top Management Middle Management
Supervisory & Lower-Level Management
Time Horizon Long: years Medium: weeks, months, years
Short: day to day
Level of Detail
Highly aggregated Less accurate More predicted
Summarized Integrated Often financial
Very detailed Very accurate Often nonfinancial
Orientation Primarily external Primarily internal with limited external
Internal
Decision Extremely judgmental Uses creativity and analytic skills
Relatively judgmental
Heavy reliance on rules
Figure I.8 Informa2on Characteris2cs across Hierarchical Levels
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What’s the difference between IS and IT?
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Figure I.9 System Hierarchy
Management
Information Systems
People Technology Process
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System Hierarchy • Informa2on systems are comprised of three main elements: – Technology – People – Process
• Infrastructure – everything that supports the flow of processing informa2on – Hardware, soeware, data, and components.
• Architecture – strategy implicit in these components.
Ac2vity 1.2 Tom Peters
ACTIVITY 1.2—SIMPLIFYING SYSTEMS Having watched the Tom Peters video, reflect on whether or not your organisa2on ac2vely encourages con2nuous improvement of systems. What would you do to implement a program where your people can make it easier to achieve your core business objec2ves through simplifying systems? .
ORGANISATIONAL NEEDS AND INVESTMENT
• Enterprise Resource Planning systems (ERP) systems
• data-‐warehousing and data-‐mining systems • Groupware • group support systems • Intranets • e-‐commerce and e-‐business services and
tools.
How much to invest and where?
Gibson and Nolan: Stages of Growth Stage 1: Ini?a?on simple administra2ve func2ons such as automa2on of payroll or general ledger func2ons. low expenditures, liXle user involvement. Stage 2: Contagion broader-‐ranging uses of IT,.. As usage grows, there is a lack of general control. Budgets grow rapidly; the focus is on the machine; IT use is plagued by crises. Stage 3: Control 2ghter controls are necessary upgrading system documenta2on, budget reviews and full charge-‐out of IT costs to user departments. Integra2on of incompa2ble systems and user frustra2on become common themes. Stage 4: Integra?on user-‐oriented steering commiXees, financial planning for applica2ons, charge-‐back systems. 5: Data administra?on data is a corporate resource
Focus on informa2on systems, rather than informa2on technology. Stage 6: Maturity data administra2on. Organisa2ons use their data resources to develop compe22ve and opportunis2c applica2ons, not simply applica2ons to make their own internal opera2ons more efficient. The aim is to develop data-‐resource management strategic planning.
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Summary
• Business managers “must” be involved in informa2on decisions.
• IT is a cri2cal resource. • People and Technology work together. • Certain key skills are needed. • Data, Informa2on, and Knowledge are dis2nct.
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THE CASE FOR PARTICIPATING IN DECISIONS ABOUT INFORMATION SYSTEMS
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CASE STUDY 1:
• Amazon.com has garnered a leadership posi2on in the online world by leveraging their new business model. See www.amazon.com – Expanded market offerings. – Increased customiza2on and personaliza2on – Smarter storage – Cost cuxng.
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CASE STUDY 2:
• Google has become the leader in the search engine market through innova2on, simplicity, and by adding new features. – See www.google.com – Their mission statement can be found at
hXp://www.google.com/corporate/
The informa2on facts of life
If informa2on is power and money, people won't share it easily.
TOPIC 2: Managing using a systems approach
Analyse IS and its management using a number of analysis approaches
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Objec2ves
1. define the terms 'system' and 'informa2on system' in a management context
2. explain the difference between tradi2onal and object-‐oriented approaches to systems analysis
3. produce a basic data-‐flow diagram 4. Produce a basic en2ty–rela2onship diagram
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1. System ?
A group of • interac2ng, • interrelated, or • interdependent elements forming a complex whole.
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1. Informa2on System ?
• An informa2on system (IS) can be defined in a very broad way as the collec2on of informa2on technology, procedures and people responsible for the capture, movement, management and distribu2on of data and informa2on.
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1. System Analysis?
'Systems analysis and design' is a set of principles, a method by which we can consider, design and implement informa2on systems . 1. Tradi2onal Approach 2. Object oriented Approach
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Tradi2onal Approach
1. Flow chart 2. Data flow diagrams 3. En2ty Rela2onship diagrams
DFD for ??
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OOP Approach
1. Objects 2. Instances 3. Classes, Subclasses
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How to develop IS for your organiza2on?
1. Plan (Strategy) 2. Analyse (Business) 3. Design (IT, system) 4. Implement (Development and cutover)
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Key Characteris2cs
• It is user driven • It is data focused • It is automated • It uses models • It uses formal structured techniques • It treats the full Systems Planning Life cycle-‐ Integrated whole
• It is a Reduc2onist Approach • It builds a corporate knowledge base
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Real World Example • Na2onal Linen Service was facing poor earnings due to increased compe22on and a weak economy.
• They created a strategic systems department to increase compe22veness.
• A new system was implemented, BOSS, that deleted expired customer contracts hur2ng their boXom line.
• The unintended consequences of the system were not taken into account.
The informa2on facts of life
Managers prefer to get informa2on from people rather than computers; people add value to raw informa2on by interpre2ng it and adding context.
TOPIC 3:Informa2on systems and strategy Iden2fy the elements that combine to form an informa2on vision and informa2on technology (IT) architecture
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Objec2ves • define 'mission statement' and 'vision statement', and enumerate the
differences between them
• explain how organisa2ons can use IS to gain strategic and compe22ve advantage, and iden2fy poten2ally useful IS applica2ons for your own organisa2on
• explain how SIS can change the nature of a business or industry when it is used as an instrument to change the balance of power between the business and its compe2tors, customers and/or suppliers
• iden2fy and evaluate some of the poten2al risks, as well as the opportuni2es, which strategic systems can create
• explain how interorganisa2onal systems, especially e-‐business, can be used to provide beXer service for customers.
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Do you have a WriXen Strategy • Vision • Mission • Strategy • Corporate Plan
A plan ar2cula2ng where a business seeks to go and how it expects to get there. It is the means by which a business communicates its goals.
Wal-‐Mart: "To give ordinary folk the chance to buy the same thing as rich people.”
3M: "To solve unsolved problems innova?vely.”
Walt Disney: "To make people happy.”
How to Write Strategy Statement
What is this missing?
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The Impact of IS • The Informa2on Systems Strategy Triangle is a simple framework for understanding the impact of IS on organiza2ons.
• Successful firms have an overriding business strategy.
• This business strategy drives both Organiza2onal and Informa2on strategy.
• All decisions are driven by the firm’s business objec2ves.
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Figure 1.1 The Informa2on Systems Strategy Triangle
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IS Strategy Triangle
• Business Strategy drives all other strategies. • Organiza2onal and Informa2on Strategy are then dependent upon the Business Strategy.
• Changes in any strategy requires changes in the others to maintain balance.
• IS Strategy is affected by the other strategies a firm uses.
• IS strategy always involves consequences.
BRIEF OVERVIEW OF BUSINESS STRATEGY FRAMEWORKS
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Generic Strategies Framework
• Michael Porter describes how businesses can build a sustainable compe22ve advantage.
• He iden2fied three primary strategies for achieving compe22ve advantage: – Cost leadership – lowest-‐cost producer. – Differen2a2on – product is unique. – Focus – limited scope.
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Figure 1.2 Three strategies for achieving compe22ve advantage.
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Using Informa2on Resources to Influence Compe22ve Forces • Porter’s five forces model show the major forces
that shape the compe22ve environment of the firm.
1. Threat of New Entrants: new firms that may enter a companies market.
2. Bargaining Power of Buyers: the ability of buyers to use their market power to decrease a firm’s compe22ve posi2on
3. Bargaining Power of Suppliers: the ability suppliers of the inputs of a product or service to lower a firm’s compe22ve posi2on
4. Threat of Subs?tutes: providers of equivalent or superior alterna2ve products
5. Industry Compe?tors: current compe2tors for the same product. • Figure 2.2 and 2.3 show this model in detail.
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Figure 2.2 Five compe22ve forces with poten2al strategic use of informa2on resources.
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Porter’s Compe22ve Advantage • Remember that a companies overall business strategy will drive all other strategies.
• Porter defined these compe22ve advantages to represent various business strategies found in the marketplace.
• Cost leadership strategy firms include Walmart, Suzuki, Overstock.com, etc.
• Differen2a2on strategy firms include Coca Cola, Progressive Insurance, Publix, etc.
• Focus strategy firms include the Ritz Carlton, MarrioX, etc.
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Framework Key Idea Application to Information Systems
Porter’s generic strategies framework
Firms achieve competitive advantage through cost leadership, differentiation, or focus.
Understanding which strategy is chosen by a firm is critical to choosing IS to complement that strategy.
D’Aveni’s hyper-competition model
Speed and aggressive moves and countermoves by a firm create competitive advantage
The 7 Ss give the manager suggestions on what moves and countermoves to make. IS are critical to achieve the speed needed for these moves.
Figure 1.5 Summary of key strategy frameworks.
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Understanding Organiza2on Strategy
To understand organiza2onal strategy we must answer the following ques2ons:
1. What are the important structures and repor2ng rela2onships within the organiza2on? 2. What are the characteris2cs, experiences, and skill levels of the people within the organiza2on? 3. What are the key business processes? 4. What control systems are in place? 5. What is the culture of the organiza2on?
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Framework Key Idea Usefulness in IS Discussions
Business Diamond
There are 4 key components of an organization: business processes, values and beliefs, management control systems, and tasks and structures.
Using IS in an organization will affect each of these components. Use this framework to identify where these impacts are likely to occur
Managerial levers
Organizational variables, control variables, and cultural variables are the levers managers can use to affect change in their organizations
This is a more detailed model than the Business diamond and gives specific areas where IS can be used to manage the organization and to change it
Figure 1.8 Summary of organiza2onal strategy frameworks
BRIEF OVERVIEW OF INFORMATION SYSTEMS
STRATEGY
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IS Strategy
• The plan an organiza2on uses in providing informa2on services.
• IS allows business to implement its business strategy. • IS helps determine the company’s capabili2es. • Four key IS infrastructure components are key to IS strategy (Figure 1.9)
• These key components are sufficient to allow the general manager to assess cri2cal IS issues.
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What Who Where
Hardware List of physical components of the system
Individuals who use it Individuals who manage it
Physical location
Software List of programs, applications, and utilities
Individuals who use it Individuals who manage it
What hardware it resides upon and where that hardware is located
Networking Diagram of how hardware and software components are connected
Individuals who use it/ Individuals who manage it/ Company service obtained from
Where the nodes are located, where the wires and other transport media are located
Data Bits of information stored in the system
Individuals who use it Individuals who manage it
Where the information resides
Figure 1.9 Informa2on systems strategy matrix.
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Competitive Force IT Influence on Competitive Force
Threat of New Entrants
Can be lowered if there are barriers to entry. Sometimes IS can be used to create barriers to entry
Bargaining Power of Buyers Can be high if it’s easy to switch. Switching costs are increased by giving buyers things they value in exchange such as lower costs or useful information
Bargaining Power of Suppliers Forces is strongest when there are few firms to choose from, quality is inputs is crucial or the volume of purchases is insignificant to the supplier
Threat of Substitute Products Depends on buyers’ willingness to substitute and the level of switching costs buyer’s face
Industrial Competitors Rivalry is high when it is expensive to leave and industry, the industry’s growth rate is declining, or products have lost differentiation
Figure 2.3 Applica2on of five compe22ve forces model.
How Important is SIS for you?
What is the impact if SIS?
Significance of SIS
Digicel Edge Vs. 3G
Digicel 3G Vs. 4G
Jus2fying SIS – Cost Benefit Analysis
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Figure 1.1 The Informa2on Systems Strategy Triangle
The informa2on facts of life
There's no such thing as informa2on overload; if informa2on is really useful, our appe2te for it is insa2able.
Next Workshop – 15th August Week 1
• First workshop • Topic 1,2,3
Week 2 • Read the Study guide • Read the e-‐book
Week 3 • 2nd workshop • Topic 4,5,6
Week 4 • Do the assignment
Week 5 • 3rd workshop • Topic 7,8,9,10
Week 6 • Exam on 4th September