Chapter 2
IT Support Systems: Concepts and Management
1
Learning objectives
• Define information system
• Types of Information System
• Describe and contrast Transaction Processing
System and Functional Information System
• Identify major enterprise internal support
systems and relate them to managerial functions
2
• Describe support of IT along the supply chain in using
ERP and CRM
• Discuss information infrastructure and architecture
• Compare client server architecture, mainframe based
legacy systems and P2P architecture
• Describe different types of web based information
systems and their functionalities
3
• Describe Software-as-a-service (SaaS) and
software oriented architecture (SOA)
environments
• describe how Information resources are
managed
• Describe roles of ISD and end users
4
Information System: concept and definition
• IS- one that collects, processes, stores analyzes and
disseminates data and information for a specific purpose
• Components:
– Hardware
– Software
– Data
– People
– Procedure
– Application Program
• Collection of application programs in a single department is
usually considered as a departmental Information System 5
Data, Information and Knowledge
• Data
– elementary description of things, events, activities and
transactions that are recorded, classified and stored
– Not organized to convey any specific meaning
• Information
– organized data so that they have meaning and value to
the recipient
6
• Knowledge
– organized and processed data to convey
understanding, experience, accumulated learning and
expertise as they apply to the current problem and
activity
7
Classification and types of IS
By type of support provided
Classification of Information System
By Organizational Levels
8
Classification by organizational levels
• Can be stand alone but usually they are interconnected
Levels of Information systems 9
• Personal and productivity systems
– Small systems built to support many individuals
– Known as Personal Information Management (PIM)
– Intend to support the activities of individuals to ease their
work or life
– Through acquisition, organization, maintenance, retrieval
and sharing of information
10
– E.g. PDA, calculator
– Designed to increase our productivity and satisfaction
– Abundant in organizations, inexpensive and have
fairly standard capabilities
11
• Transaction Processing System
– Supports repetitive information processing tasks such
as
– Periodic financial, accounting and other routine
business activities
– Supports the monitoring, collection, storage,
processing and dissemination of the organization’s
basic business transactions
12
– Provides input to other IS
– Critical to success of any organization since they
support core operations
– collects data periodically or in real time
13
• E.g. of TPS
– In retail stores, data flows from Point of Sale
to database
– Reduces the level of inventory
– Increases the revenue in company’s cash
position
14
• Functional & Management Information Systems
– cover some repetitive and some occasional
activities
– Major functional information systems are
• Accounting
• Finance
• Production/operation
• Marketing &sales
• Human resource management 15
– FIS ensure that business strategies come to fruition in an
efficient manner
– Provides periodic reports on operational efficiency,
effectiveness and productivity
– Two types of functional Information Systems:
• Those support managers (MIS)
– By providing periodic reports, summaries, comparisons
– Helps to make better decisions
• Those support other employees (analysts, other staff) in
functional areas16
• Enterprise Information Systems
– EIS support business processes that are performed by
two or more departments
– Business process is a collection of activities performed to
accomplish a clearly defined goal and may cross
departmental / organizational boundaries
– EIS follows such processes and usually integrate tasks
done in different departments
– E.g. Enterprise Resource Planning (ERP)17
Process A: Typical TPS
Process B: Procurement
Process C: Customer Services
Process D: Order taking n fulfilling
18
• Interorganizational systems
– Connect two or more organizations
– E.g. worldwide airline reservation system
– Most common are those that connect buyers
and sellers
19
Departmental, enterprise and inter-organizational information systems
20
• Global Information Systems
– IOS that connect companies located in two or more
countries
– E.g. many e-commerce systems
• Very large and special systems
– Include many subsystems of the previous levels
– Industry specific systems
21
Classification based on the type of support provided
• MIS
– Middle managers
– Provides routine information for planning, organizing,
and controlling operations in functional areas
• Office Automation System (OAS)
– Office workers
– Increases productivity of office workers
22
• CAD/CAM
– Engineers and drafts people
– Allows engineers to design and test prototypes
– Transfers specifications to manufacturing facilities
• Communication and collaboration systems
– All employees
– Enables employees, partners and customers to
interact and work together efficiently23
• Desktop publishing systems
– Office workers
– Combines text, photos, graphics to produce
professional quality documents
• Decision support systems (DSS)
– Decision makers, managers
– Combines models and data to solve semi structured
problems with extensive user involvements24
• Document management systems
– Office workers
– Automates flow of electronic documents
• Group Support Systems (GSS)
– Supports working processes of groups of people
25
• Expert systems (ES)
– Knowledge workers, nonexperts
– Provide stored knowledge of experts to non-experts
and decision recommendations based on built-in
expertise
• Knowledge work systems (KWS)
– Managers, knowledge workers
– Supports the gathering, organizing and use of
organizational knowledge26
• Neural networks, Data mining
– Knowledge workers, professionals
– Learn from historical cases, even with vague or
incomplete information
• Business Intelligence (BI)
– Decision makers, managers, knowledge workers
– Gathers and uses large amount of data for analysis
by business analytics & intelligent systems
27
• Mobile computing systems
– Mobile employees
– Supports working outside the physical boundaries of
organization
• Automated Decision Support Systems (ADS)
– Frontline employees, middle managers
– Supports customer care employees and sales people
to make quick real time decisions28
Relationship between IS
• Each IS has sufficiently unique characteristics
• There is information flow among these entities and
systems
• E.g. MIS extracts information from TPS and BI
receives information from Data warehouse and MIS
• As the technology changes, interrelationship and
coordination among the different types of systems
continue to evolve29
Interrelated Support Systems
30
How IT supports people and organizational activities
• Organizational activities
– Operational
• Deal with day-to-day activities of an organization
• E.g. assigning task to employees and recording their
working hours
• Short term in nature
• Supporting IS are TPS, MIS and mobile systems
• Used by supervisors, operators and clerical employees
31
– Managerial
• Also called tactical activities
• Deal with middle management activities such as
short term planning, organizing and control
• Middle managers can get quick answers to queries
from such systems using BI reporting and query
capabilities
32
33
– strategic
• Activities or decisions that deal with situations that may
significantly change the manner in which business is
done
• Involve long-range planning
• E.g. introducing new product, expanding business by
acquiring supporting businesses, Moving operations to
the foreign countries
• From such long range planning, companies derive their
short range plans, budgeting and resource allocation
34
• Strategic activities help organization in other two
ways:
– Strategic response activities
• React quickly to a major competitor’s action or to
any other significant change in the enterprise’s
environment
• e.g. Kodak could beat Japanese company in
developing the disposable camera
35
– Innovative strategy (initiator of change)
• Instead of waiting for a competitor to introduce a
major change or innovation, an organization can
be the initiator of change
36
Who performs what activities and how IT supports them?
37
• Executives and Managers
– Responsible for strategic decisions
– Support systems:
• BI (Business Intelligence)
• Corporate Performance Management (CPM)
38
• Middle Managers
– Tactical decisions
– Support systems:
• Functional Information systems
• MIS
39
• Staff Support
– Advisors and assistants to top and middle level managers
– Knowledge workers
– Create information and knowledge as a part of their work
and integrate it into business
– E.g. financial and marketing analysts, production
planners, lawyers, accountants
– Support systems:
• Search engines
• Expert systems
40
• Lower level managers, frontline employees
– Operational decisions
– Support systes:
• ADS
• Functional IS
• MIS
41
• Clerical staff
– Use, manipulate or disseminate information
– Data workers
– E.g. bookkeepers, secretaries
– Support systems:
• Office automation
• Communication systems
• Document management42
How IT supports supply chain and enterprise systems?
• Supply chain – concept describing the flow of
– materials,
– information,
– money and
– services
from raw material suppliers through factories and
warehouses to the end customers
43
A simple supply chain
44
• Supply chain is difficult to manage since it needs to
coordinate
– Several business partners
– Internal corporate departments
– Numerous business processes
– Many customers
45
• IT support of supply chains is divided according to three
segments of supply chain
– Support of internal supply chain
– Support of upstream supply chain
– Support of downstream supply chain
46
Support of internal supply chain
• Involves TPS & other enterprise information
systems & functional information systems
• Special SCM softwares are available
– E.g. inventory management, production scheduling
47
Support of upstream supply chain
• To improve procurement activities and relationships with
suppliers
Support of downstream supply chain
•Supports downstream supply chain in two areas
•Customer relationships
•Order taking and shipments to customers
48
Information systems infrastructure & architecture
• Information infrastructure
– Consists of
• the physical facilities, services and management that support
all shared computing resources in organization
• Their integration, operation, documentation, maintenance &
management
49
– 5 major components
• Computer hardware
• Software
• Network & communication facilities
• Databases and data workers
• Information management personnel
50
Information technology architecture
• A high level map or plan of information assets in an
organization including the physical design of the building
that holds the hardware
• On the web, IT architecture includes the content and
organization of the site and the interface to support
browsing and search capabilities
51
• Guide for current operations and blueprint for future
directions
• Creating IT infrastructure is a cyclic process which is
driven by business architecture which describes
organizational plans, visions, objectives and problems
and the information required to support them
52
Emerging computing environments: SaaS
• SaaS (Software as a Service)
• Popular enterprise model in which computing resources
are made available to the user when they are needed
• Also referred to as SaaS, On demand computing, Utility
computing or hosted services
• Instead of buying and installing expensive and annoying
packaged enterprise applications, user can access them
over a network with a browser
53
• No need to buy h/w or s/w
• Paid for through a fixed subscription fees or payable per
an actual usage fee
• Offer standardized, componentized, common & lower
cost s/w services which can be sourced at will from
some type of service provider
54
Why SaaS was needed?
• Enterprises are challenged of being able to meet
fluctuating demands efficiently to become an adaptive
enterprise
• To overcome this challenge, SaaS like models were
developed
• enterprise’s demand on computing resources can vary
drastically from time to time
• Maintaining sufficient resources to meet peak
requirements can be costly55
• If enterprises cut the cost by maintaining only minimal
computing resources, there will not be sufficient
resources to meet the peak requirements
• So to balance the increasing requirements & cost of
resources, SaaS is developed
56
Who should be the provider of these services?
• Either a s/w developer/host such IBM or Oracle
or
• Third party intermediary such as an application
service provider
57
Implementing SaaS- a utility computing concept
• Utility computing is computing that have– Computing resources available on demand from
virtual utilities around the globe– Always on and highly available– Secure– Efficiently metered– Priced in a pay-as-you-use basis– Dynamically scaled– Self healing– Easy to manage
58
• If utility computing becomes successful, all s/ws will become
a service and be sold as a utility one day
• Limitations
– Cost (can be advantage or disadvantage)
– what the client needs and what the provider offers aren't in alignment
– Reliability
• utility computing company is in financial trouble or goes out of business
– Hard to do in heterogeneous data centers
– Works better for some applications than for others
– Needs extra security (attractive targets for hackers)
– Distribution of software is different from distribution of utilities
59
Grid computing
• Conventional networks are designed to provide communication
among devices
• The same n/ws can be used to support the concept of grid
computing in which– Unused processing cycles of all computers in a given network can be
harnessed to create powerful computing capabilities
• Grid computing coordinates the use of a large no. of servers &
storage, acting as one computer
• Saves money and resources
• Candidates for grid computing– Companies doing multi-hour-long processing jobs– Making complex scientific & mathematical computations 60
Mobile computing & mobile commerce
• Computing paradigm designed for mobile employees and
others who wish to have a real-time connection from anywhere
between a mobile device and other computing environments
• M-commerce is a commerce in a wireless environment such
as through wireless devices like cellular phones & PDAs
• Enables users to access internet without needing to find a
place to plug-in
– E.g. smart phones
• Emerging mobile technology: pervasive computing
61
• In pervasive computing, computation becomes
part of environment
• Computation will be embedded in things, not in
computers
• Improves efficiency in work & living tasks
• Enriches the quality of life through art, design &
entertainment62
Service Oriented Architecture (SOA)
• Enterprises need to be
– adaptive and
– respond more quickly to consumer demands & at the same time
– ensure security, data integrity & regulatory compliance
• Current architecture & infrastructure may not support the
level of flexibility needed in rapidly changing business
environment
63
• Solution: don’t form a monolithic rigid solution,
• systems are developed as federation or composite
applications which are tied together only at the point of
execution
• This enables alternative s/w components to be
substituted between each use of a system allowing much
greater flexibility
64
• Thus the basic idea behind the SOA is to reuse &
reconnect existing IT assets/ services rather than more
time consuming & costly developments of new systems
• In SO environment, organizations make resources
available to participants via a n/w as independent
services that can be accessed in a standardized way
using web services
• SaaS at its highest level, must be delivered as a SOA &
must embody web services65
• Advantages of SOA
– Reduced integration cost
– Improved business/IT alignment
– Extension & leveraging of existing IT investments
– Faster time to assemble new applications
– Lower IT maintenance cost
66
Web services
• Self-contained, self-describing business & consumer
modular applications
• Delivered over internet
• User can select and combine through any device (from
PC to mobile phones)
• By using set of shared protocols & standards these
applications share data & services without requiring
human beings to translate the conversion
67
• Results in real time links among the online processes of
different systems & companies
• Fosters new interactions among businesses & create
more user friendly web for consumers
• Provide inexpensive & rapid solutions for application
integration, access to information & application
development
68
Components of web services
69
• Service
– Means by which the needs of consumer are fulfilled with the
capabilities of s/w provided
• Consumer
– Function that consumes the result of a service provided by provider
• Provider
– Function that performs a service in response to a request by a
consumer
• Registry (directory)
– Contains all the information regarding registered services including
detailed descriptions
70
Working of web services
• Step 1: providers of services publish (register) their
services in the registry
• Step 2: consumers search them in registry either private
or public
• Step 3: once consumer finds a match
• Step 4: he sends a request to the service provider to get
the specific programmed service
• Step 5: provider provides the services to the customer
71
Virtualization
• Separates business applications & data from h/w
resources
• This allows companies to pool hardware resources
& assign them to applications as needed
• Types of virtualization
– Storage virtualization
– N/w virtualization
– H/w virtualization
72
Storage virtualization
• Pooling of physical storage from multiple
n/w storage devices into a single storage
device
• Which is then managed from a central
console
73
N/w virtualization
• Combines the available resources in a n/w by
splitting the n/w load into manageable parts
• Each of these parts can be assigned to a
particular server on network
74
h/w virtualization
• Use of s/w to emulate h/w or a total computer
environment other than the one in which s/w is
actually running
• It allows a piece of h/w to run multiple OS
images at once
• Sometimes called as virtual machine
75
Advantages of virtualization
• Increases the flexibility of IT assets
• Allows companies to merge IT infrastructure
• Reduce maintenance & administration cost
• Prepares for strategic IT initiatives such as grid,
utility computing and SOA
76
Managerial Issues
• Which IT resources are managed by whom?
– Responsibility of Information resource management is
divided between two entities
– Information System Department (ISD)
• Responsible for corporate level shared resources
– End users
• Responsible for departmental resources
• The role of the IS Department
– Changing from purely technical to managerial and strategic
77
Managerial Issues (contd..)
• The transition to a digital enterprise
• How to deal with the outsourcing and utility
computing trends
• Ethical issues
78
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