What is IS?

P. Pete ChongMartel Corp Prof of CIS

University of Houston-Downtown

What is Information?

Supports Decision Anything that does not support

decision is only data What is Decision? Why Decision?

Must Come Out Ahead

Profit = Revenue - Cost Profit = Benefit - Cost The goal is to increase profit, not just

to decrease cost or increase benefit

Rational Decisions

For Profit > 0, Benefit/Cost > 1 This ratio makes a RATIOnal decision Decision can then be reduced to:

IF (B/C > 1) THEN

Do

ELSE

Don’t Do

ENDIF

Wrong Decisions?

IF (Value > Threshold) THEN… Use wrong decision criteria False assessment of values

IF(B/C > 1) THEN… Benefit = Bij P(Bij)

Cost = Cij P(Cij)

Information System IS Decision Support System

Management: Allocation of Resources Information: Data Analysis Systems: Information Technology

(narrow), Organization Restructure (broad)

Pete’s Pet Rules

The 70% Rule The 5% Rule Modular Combination The 80/20 Rule

The 70% Rule

Benefit to self comes from benefit to clients – customer-centered approach

The 5% Rule

Things are processed only 5% of time – increase productivity by reduce waiting time

Modular Combination

Any solution is a combination of existing solutions

The 80/20 Rule

Significant Few vs. Trivial Many

System Development Life Cycle (SDLC)

Enterprise View Requirements Analysis Logical Design Physical Design Implementation/Testing

Enterprise View

Define goals

Requirements Analysis

What does it take? Identify Critical Success Factors from

interview, and study documents and forms.

Logical Design

Organize by relevance and usage Create a “system on paper” Assume “prefect technology”

Physical Design

Find the “right” tools Modify LD result to fit reality

Implementation and Testing

Coding and testing

Benefits of Using SDLC

Separation of Managerial Issues from Technological Issues

Results of Logical Design is stable (change little over time) and portable (may be implemented using many different tools)

Effectiveness vs. Efficiency

Goal definition and factor identification are effectiveness issues

ORGANization is an efficiency issue

IS Impact: Value Chain View

Inbound Logistic Process Outbound Logistic Marketing and Sales Customer Service

IS Impact: SDLC View

Automation Rationalization Reengineering Paradigm Shift

Automation

Standard Operation Procedures Quick and measurable benefit

Rationalization

Streamlining the process Remove unnecessary steps With automation and increased

reliability, the elimination of monitoring system (source of security problems?)

Reengineering

Accomplish the same goal with different means

Replace qualitative decision criteria with quantitative ones

Paradigm Shift

Changing goals, either contract or expand