Chapter 6: Foundations of Business Intelligence: Databases and Information Management

Information is becoming as important a business resource as money, material, and people. Even though a company compiles millions of pieces of data doesn’t mean it can produce information that its employees, suppliers, and customers can use. Businesses are realizing the advantage of compiling useful information, not just DATA.

Problems occur in managing data resources in a traditional file environment such as: data redundancy, program-data dependence, inflexibility, poor data security, and inability to share data among applications.

To illustrate these problems, let’s say you move and change addresses, you notify everyone of your new address including your bank. Everything is okay with receiving your monthly statements. All of a sudden, at the end of the year, the bank sends a Christmas Card to the old address. Why? Because the Bank changed the address in “one” database; the address was not changed in the separate Christmas Card database.  You are now a victim of data redundancy.

Managers and employees must know and understand how databases are constructed so they know how to use the information resource to their advantage.

Database Management Systems have three critical components: the data definition language, the data manipulation language, and the data dictionary. Managers should ensure that all three receive attention. There are three types of databases: hierarchical, network, and relational. Relational databases have been the most popular because they are easier to work with, change, and serve more organizational needs.

When designing a database one should think long and hard about how the information will be used in different situations. Consider how it is organized, stored, and used. Then imagine how this information could be organized better and more easily used. Involve as many end users in the planning stage as possible; they are the ones who will prosper or suffer because of the decisions made.

As organizations want and need more information about their company, their products, and their customers, the concept of data warehousing has become very popular. No, data warehouses are not big buildings with shelves and shelves of stuff; they are huge computer files that store old and new data that companies want to maintain information on. Using a data warehouse correctly can give management a tremendous amount of information that can be used to trim costs, reduce inventory, and attract new customers.

Ask any manager what their resources are and they will likely list people, equipment, buildings, and money. Very few managers will include INFORMATION on the list, yet it can be more valuable than some of the others.

Bottom Line: Information is power. The more information users have in an easy to use form, the more they can accomplish. Managers need to consider information as an important resource for which everyone has a responsibility.

Chapter 5: IT Infrastructure and Emerging Technologies

When you mention the phrase “information technology infrastructure", most people immediately think of just hardware and software. However, there is more to it than just those two. By broadening the definition to that of service-based, you are then bringing into the discussion the services generated by the first two components.

Some of the services to consider are: connecting employees, customers, and supplier; managing large amounts of data for internal and external use; and training employees how to use systems.

A typical company IT infrastructure can be divided into three major levels: public, enterprise and business. Each level has its own unique hardware, software, and service components.  Public includes the internet, networks, cellular phones. Enterprise includes email, intranets, and extranets. Business concentrates on components that serve: sales and marketing; production and manufacturing; finance and human resources.

One of the biggest drivers of technology evolution is declining communication costs and the internet. The exploding use of computers is directly attributed to the Internet. It is cheaper every day to connect to the Internet because of the declining costs. As more and more users connect to the Internet, businesses must find ways to meet the expectations and demands of users.

What is trending in Hardware and Software Platforms? The microprocessor is the heart of any computing device no matter how small or large. Microprocessing chips are produced by two companies: Intel and Advanced Micro Devices (AMD). The use of networks and mobile handheld devices has created the following hardware trends: mobile digital platforms, grid computing, virtualization, cloud computing, and green computing.

Since the network is becoming so commonplace and the heart of computing, network service providers must have the server backbone in place to meet the increased demand. Blade servers are meeting the needs of service providers easier than big-box servers.

Integrating applications into seamless processes across the organization is the goal of enterprise software application. The largest providers of enterprise application software are SAP and Oracle. Microsoft is making moves to focus on small and medium-sized businesses. The evolution of software platforms has created: Linux and open source software, Java and Ajax, Web Services, Software outsourcing and cloud services.

It’s extremely hard to figure out ahead of time how much computing capacity a company will need. It’s like gazing into a crystal ball and trying to analyze the future. Managers need to design scalability into their systems so that they don’t under or over build their systems. A company should examine its IT strategy, infrastructure, and cost for the next five years then decide the direction to go with technology.

Chapter 4: Ethical and Social Issues in Information Systems

It probably goes without saying that the security and ethical issues raised by the information age, and specifically the internet, are the most significant in decades. It will be many years and many court cases before socially acceptable policies and best practices are in place.

Scenario: You are a 25 year old, drive a Honda, like country music, shop at walmart at least once a month around the 15^th, wear a size 8 dress, like eating at Sonic, and spend lots of time on facebook chatting with other females your age. Would it surprise you to know that this information can be taken from various computer records?

A lot of personal information about us has always been available, just not as easily and as readily as today. Commercial company and government databases now allow profiling like in the scenario above to be done easier and faster than before.

New information technology raises new ethical, social and political issues that must be dealt with on individual, social, and political levels. These issues have five moral dimensions: information rights and obligations, property rights and obligations, system quality, quality of life, and accountability and control.

Technology can take information about people and find vague, non-obvious relationships. It might discover, for example, that an applicant for a job as a non-profit organization shares a telephone number with a known criminal and alerts the hiring manager.

Technological trends are posing new situations and questions we haven’t had to deal with before. Because it’s our world and our future, we should be concerned and prepared to resolve.

How do we solve some of the real world ethical dilemmas? Should companies be allowed to read employee’s personal emails? Should emails be used against a person or company in a court of law? Is it okay to run a personal website from your workplace computer? Should companies use technology to monitor your keystrokes to determine how much work you are doing?

Bottom Line: Ethics in an information society holds each person responsible for his or her actions. Each person is accountable for everything he or she does and liable for the consequences their actions may impose on other people and society.

Companies can no longer ignore the necessity of establishing rules for technology use. The issue won’t go away and will continue to grow. If you work for a company that does not have a policy, get busy and suggest one for everybody…..it’s the right thing to do!

Chapter 3 - Information Systems, Organizations, and Strategy

Chapter 3 – Information Systems, Organizations, and Strategy

Chapter 3 describes how organizations and information systems work together, or sometimes against each other; the idea is to keep them in sync.

Consider this, an automobile dealership would have some similarities to a department store (both sell products) and yet they would have major structural differences. Organizations that enter into collaborative partnerships tend to seek out companies with similar structures. It is much easier for the employees to work together if they aren’t required to learn a whole different work structure on top of learning new tasks.

Organizations generally differ because their ultimate goals differ; some organizations are small by nature or small by design. Many differ due to size, goals, and environmental factors that restrict growth.

For instance, a real estate company is constantly looking for new customers and new products to sell. It may choose to stay small or to go with a nationwide conglomerate. The environmental factors that are likely to influence it are the state of the national and local economy.

Organizations and information systems influence each other. Each organization shares common characteristics that the information system can enhance. On the other hand, each organization has unique characteristics that should be taken into account when incorporating technology. Perhaps the most important role of all is the end user.

Various forces affect an organization’s ability to compete and therefore greatly influence a firm’s business strategy. There are threats from new market entrants and from substitute products and services. Customers and suppliers exercise bargaining power; traditional competitors constantly adapt their strategies to maintain their market positioning.

Using information systems can help a company beat the competition through differentiation and providing services that are valuable to customers and suppliers. Information systems can also be used to reduce costs. What is the goal?

Completing a strategic systems analysis is one of the first steps managers should accomplish to help determine how they can use information systems to gain a competitive advantage. A well-developed strategic information system that is integrated throughout the company can be used to lower overall costs and provide greater value to the company, the supplier, and the customer.

Chapter 2 - Global e-Business and Collaboration

Chapter 2 – Global E-business and Collaboration

Being a digital company means more than just having the newest computers with all the latest bells and whistles. The digital company must connect each functional area and each management level to one another. Human Resources, Sales, Accounting, and Manufacturers must have access to appropriate information regardless of its origin. Information is the key to a digital company.

Business Processes that integrate functions throughout an organization assist with eliminating chaos. Processes can deliver the best product for the lowest cost and in the most efficient manner. The way a company organizes its workflows, the method it uses to accomplish tasks, and the way it coordinates its activities among employees, and customer, and suppliers determines its business processes.

Information systems can help organizations recognize processes that may need to be changed and automate some of those processes that are no longer needed. A successful organization will use an information system to determine which processes work well.

Management groups in organizations are served by four types of information systems. The transaction processing system (TPS) records the data from everyday operations throughout every division or department in the organization. Ex. How much sugar do we have for today’s production run?

The management information system (MIS) is used by managers throughout the organization to help them in directing, planning, coordinating, communicating, and decision making. The MIS will help answer structured questions: “How much more sugar must we purchase to increase production from 500 cakes to 700?

Decision-support systems (DSS) are used for complex questions that require internal and external data. Ex. “How does will a change in size of the packaging of the cake affect the other products we produce, not just in shipping, but on the display shelves at stores?

An executive support system (ESS) helps managers make strategic decisions affecting the entire company. External and Internal data is given to executives to help determine the best course of action in different situations. With an ESS, company executives make decision based on information, not opinion.

The key element for all these system is integration. The cake would not be a success if all systems did not work together to produce a coherent picture for all levels of management. If the information from the TPS did not feed in the MIS, which incorporated information to assist the DIS, which then worked with the ESS, then the cake would just be another dessert.

Chapter 1 - Information Systems in Global Business Today

Chapter 1 – Information Systems in Global Business Today

Computers are changing every aspect of our lives from entertainment to shopping, from the work we do and where we do it, to how we communicate with friends and relatives. Information Technology is being used by many businesses worldwide to increase efficiency, save money, and create better relationships between suppliers and customers.

Information systems are transforming businesses and creating global relationships. Next time you purchase a product, any product, look at the fine print and see where it’s made. It may be China, the Philippines, or even in the United States. It can be debated that many manufacturing jobs are being moved from the U.S. to foreign countries, but look at the huge number of jobs that are being created here in the U.S. In fact, many of the jobs are in the information industry and serve whole new markets that didn’t exist just a few years ago.

Why does Information Systems matter in running and managing business today? Capital Management, Foundation for Doing Business, Productivity, Strategic Opportunities and Advantages are just a few of the reasons to consider if it matters. For many years computer technology was only the “techies” worry; today every employee, must know how to take advantage of information systems to improve organizations and leverage available information into a competitive advantage for the company.

As a company becomes more digital, its’ information system should continue to extend beyond the traditional role of serving the employees. Developing the complementary assets associated with the information systems such as developing new business processes, emphasizing employee training in technology, and creating new partnerships with suppliers, customers, and even competitors, can be challenging.

This is why using information systems effectively requires an understanding of the organization, management, and information technology shaping the systems. An information system creates value for the firm as an organizational and management solution to challenges posed by the environment.

Successful managers must concentrate on all three parts of the information systems triangle (hardware, software, and persware) then integrate them into a single, cohesive system that serves the needs of the organization, customer wants, and employee desires.

Everyone in the organization must understand that information systems and the use of technology belong to them. This concept is best carried out through a sociotechnical approach to viewing information systems, which allows both the technical and behavioral approaches to be combined for the good of the organization.

Bottom Line: Management’s focus must continually change to take advantage of new opportunities with changes taking place throughout the organization. These changes require lots of attention and planning for smooth execution.