chapter 5

CHAPTER 5; INFORMATION SYSTEMS IN THE MODERN ORGANIZATION

5; MANAGING KNOWLEDGE AND DATA

Managing data is an important step before converting these data into information then into knowledge. Many challenges face managers and those responsible of managing data and some of the problems are:

- Data need to be collected from different departments of the organizations because each has its own

- Data are stored and collected by different people and may have chance of duplicates and errors while storing and maintaining

- Data are scattered throughout the organization

- Data isolation

- Data inconsistency

- Data security

- Data integrity

- Data independence.

Data has its dimensions and the ones in Microsoft Access are all two-dimensional tables and are usually called Relational database model, these databases generally are not one big table that contains all of the records ad attributes.

 An advantage of a Rational database is that it enables people to compare information quickly by row or column. Also, users can retrieve data with specific but easy steps. On the other side, large-scale rational databases can be composed of many interrelated tables, which makes the designing process more complicated for search and access.

Data warehouses are storage capacities that store data that belong to long time ago, the stocking of these data create multi-dimensional. 


Knowledge: information that is contextual, relevant, and actionable Intellectual capital  intellectual assets

Explicit knowledge: codified (documented) in a form that can be distributed to others (CEPS student’s handbook)

Tacit knowledge: a set of insights, expertise and skills Knowledge that people carry in their heads, but difficult to write down in a document

 
Knowledge management (KM): a process of accumulating and creating knowledge efficiently, so that it can be applied effectively throughout the organization

Nothing is more frustrating for a manager than the situation in which one employee struggles with a problem that another employee knows how to solve it easily,
-Knowledge Sharing tools
-Portals
-Discussion groups - FAQa
-E-mail
-Blogs/ wikis
-Podcasts

Resistance to sharing knowledge 
-Reluctant to show that they do not know
-Employee competition

chapter 2

Information Systems and the Modern Organization 



Doing Business in the Digital Economy

w  The digital economy is an economy based on digital technologies, including communication networks (the Internet, intranets, and extranets), computers, software, and other related technologies.

w  Also called the Internet economy, the new economy, or the Web economy .

w  Digital infrastructures provide a global platform over which people and organizations interact, communicate, collaborate, and search for information.

The Global Platform of the New Economy

w  A huge number of digitizable products; that is products that can be converted to digital format.  Most common are: books, movies, magazines, TV and radio programming, electronic games, music CDs and computer software.

w  Consumers and firm conducting financial transaction digitally.

w  Physical goods such as home appliances and automobiles  that contain embedded computer chips and connectivity capabilities.

Electronic Business

w  Businesses increasingly perform their basic functions: buying and selling goods and services, servicing customers, and collaborating with business partners electronically.

w  This process is known as electronic business (E-business) or electronic commerce (E-commerce).

New Economy vs. Old Economy

Example	Old	New
Buying and selling text book	Visit the bookstore	Visit web site for publishers and retailers
Registering for classes	Walk around campus to Departments, Registrar’s office, etc.	Access campus web site
Photography	Buy film, use camera, take picture, take it for processing	Use digital camera
Paying for Gasoline	Fill up your car, go inside, pay cash or  credit card	Use speed pass token wave over the sensor and go
Paying the Transportation	Pay cash, metal tokens	Metro cards electronic cards
Paying for goods	Visit store, take the item, pay , go	Use self – service kiosks
Supplying commercial photos	Use newspapers, paper, catalog or on line	Use hub-like supply  chain with digitized picture

w  Example #1: Registering for Classes

w  Old Economy: You would go to the Registrar’s Office on campus with a paper registration document.

w  New Economy: You access your campus Web site, log into registration site, and electronically register for classes from anywhere.

w  Example #2: Buying and Selling Textbooks

w  Old Economy: You go to the bookstore in person and buy new or sell used books.

w  New Economy: You go online to the Publisher’s Web site or to Web-based services such as Amazon.com to buy or sell books. 

w  Example #3: Photography

w  Old Economy: You use a camera with film, which you have to purchase and have developed; you mail copies of pictures.

w  New Economy: You can scan photos, make copies and e-mail them. Digital cameras require no film or processing. Digital photography and video integrated into cell phones for immediate viewing.  

w  Example #4: Paying for Gasoline

w  Old Economy: You pump your gas and go inside to pay using cash or credit.

w  New Economy: Insert credit card at pump, receive authorization, pump gas, receive receipt, drive away. Another example is Speedpass technology.

w  Example #5: Paying for Transportation in New York City

w  Old Economy: Using tokens for bus and subway transportation.

w  New Economy: Bus and subway riders now use MetroCards, contactless cards that have a small radio transmitter that transmit account information to a reader.

w  Example #6: Paying for Goods, Checkout

w  Old-old Economy: Customer selects goods, waits in line for the cashier to key in price of items, and then pays in cash.

w  Old Economy: The clerk swipes the barcode of each item and customer pays in cash, credit, debit.  Information scanned is available for immediate analysis known as source-data automation.

w  Old Economy: Shoppers take their items to a self-service kiosk and swipe the barcodes themselves.

w  New Economy: Wireless technology affixed to each item allows you to select items that pass through a scanner that reads wireless signals, generates a bill, automatically debits your designated account for payment and you leave.

Business Pressures, Organizational Responses, and IT Support

w  Business Pressure - The business environment is the combination of social, legal, economic, physical, and political factors that affect business activities.

w  Significant changes in any of these factor are likely to create business pressure on the organization.

w  The three types of business pressures faced are: market, technology, and societal pressures.

IT Support for Organizational Responses to Business Pressures:

 Three Types of Business Pressures

w  Market Pressures:

n  The Global Economy and Strong Competition

n  The Changing Nature of the Workforce

n   Powerful Customers

w  Technology Pressures:

n  Technological Innovation and Obsolescence

n  Information Overload

w  Societal Pressures:   

n  Social Responsibility

n  Government Regulation and Deregulation

n  Protection Against Terrorist Attacks.

n  Ethical Issues

Organizational Responses

w  Strategic Systems provide advantages that enable organizations to increase market share and/or profits, to better negotiate with suppliers, or prevent competitors from entering their markets.

w  Customer Focus is the difference between attracting and keeping customers by providing superb customer service to losing them to competitors.

w  Make-to-Order is a strategy of producing customized products and services.

w  Mass Customization is producing a large quantity of items, but customizing them to fit the desire of each customer.

w  E-business and E-commerce is the strategy of doing business electronically.

Competitive Advantage and Strategic Information Systems

w  Competitive Advantage: An advantage over competitors in some measure such as cost, quality, or speed, leads to control of a market and to larger- than average profits.

w  Strategic Information Systems (SIS) provide a competitive advantage by helping an organization to implement its strategic goals and to increase its performance and productivity.

Porter’s Competitive Forces Model

w  The best-known framework for analyzing competitiveness is Michael Porter’s competitive forces model (Porter, 1985).

w  Model is used to develop strategies to increase their competitive edge.

w  Demonstrates how IT can make a company more competitive.

Strategies for Competitive Advantage

w  Cost Leadership. Produce products and/or services at the lowest cost in the industry.

w  Differentiation. Offer different products, services or product features.

w  Innovation. Introduce new products and services, add new features to existing products and services or develop new ways to produce them.

w  Operational Effectiveness. Improve the manner in which internal business processes are executed so that a firm performs similar activities better than its rivals.

w  Customer-orientation. Concentrate on making customers happy.

Why Should You Learn about Information Technology (IT)?

w  IT is essential for work in organizations.

w  IT will reduce the number of middle managers.

w  IT will change the manager’s job.

w  IT impacts employees at work.

w  IT impacts employees’ health and safety.

w  IT is used by all departments.

w  IT provides opportunities for people with disabilities.

w  IT provides quality-of-life improvements.

w  Improvements in health care.

w  Crime fighting and other benefits.

The Modern Organization Functioning in a Global Environment

Information Systems: Concepts and Definitions

w  Data Item. Elementary description of things, events, activities and transactions that are recorded, classified and stored but are not organized to convey any specific meaning.

w  Information. Data organized so that they have meaning and value to the recipient.

w  Example: 3.0 à Data ; Ahmed GPA is 3.0 àInformation

w  Knowledge. Data and/or information organized and processed to convey understanding, experience, accumulated learning and expertise as they apply to a current problem or activity.

w  Information Technology Architecture. A high-level map or plan of the information assets in an organization, which guides current operations and is a blueprint for future directions.

w  Information Technology Infrastructure. The physical facilities, IT components, IT services and IT management that support an entire organization.

Information Systems

w  Information System (IS). Collects, processes, stores, analyzes and disseminates information for a specific purpose.

w  Computer-based Information System (CBIS). An information system that uses computer technology to perform some or all of its intended tasks.

Basic Components of Information Systems

w  Hardware is a device such as a processor, monitor, keyboard or printer

w  Software is a program or collection of programs that enable hardware to process data.

w  Database is a collection of related files or tables containing data.

w  Network is a connecting system (wireline or wireless) that permits different computers to share resources.

w  Procedures are the set of instructions about how to combine the above components in order to process information and generate the desired output.

w  People are those individuals who use the hardware and software, interface with it, or uses its output.

Application Programs

w  Application program is a computer program designed to support a specific task , a business process or another application program.

Types of Information Systems

w  Information Systems that support specific functional areas and operations include:

n  Functional Area Information System

n  Transaction Processing System (TPS)

n  Enterprise Resource Planning (ERP) System

n  Interorganizational Information System

n  Electronic Commerce Systems

w  Functional area information systems or departmental information systems

n  Function:  Support the activities within specific functional areas.

n  Example:  System for processing payroll.

w  Transaction processing system (TPS)

n  Function:  Process transaction data from business events.

n  Example:  Walmart checkout point-of-sale terminal.

w  Enterprise Resource Planning System (ERP)

n  Function:  Integrate all functional areas of the organization.

n  Example:  Oracle, SAP

w  Interorganizational information systems (IOS) are information systems that connect two or more organizations and support interorganizational operations such as supply chain management.

n  Function:  Manage flows of products, services and information among organizations.

n  Example:  Walmart Retail Link System connecting suppliers to Walmart.

n  Supply chain describes the flow of materials, information, money and services from raw material suppliers through factories and warehouses to the end customers.

w  Electronic Commerce Systems

n  Function:  Enable transactions among organizations and between organizations and customers.

n  Business-to-Business (B2B)

n  Business-to-Consumer (B2C)

n  Example:  www.dell.com

Support for Organizational Employees

w  Knowledge workers are professional employees such as financial and marketing analysts, engineers, lawyers and accountants.

n  They create information and knowledge about a specific subject area and integrate it into an organization.

n  Act as advisors to middle managers and executives.

w  Office Automation System (OAS)

n  Function:  Support daily work activities of individuals and groups.

n  Example:  Microsoft Office

n  Support:  Clerical staff, lower and middle managers and knowledge workers.

w  Management Information System (MIS)

n  Function:  Produce reports summarized from transaction data, usually in one functional area.

n  Example:  Report on total sales of each customer.

n  Supports:  Primarily for middle managers, sometimes for lower level managers as well.

w  Decision Support System (DSS)

n  Function:  Provide access to data and analysis tools.

n  Example:  “What if” analysis of changes in a budget.

n  Supports:  Primarily for Middle managers and knowledge workers

w  Expert System (ES)

n  Function:  Mimic human expert in a particular area and make a decision.

n  Example:  Credit card approval analysis.

n  Supports:  Knowledge workers

w  Executive Information System (EIS)

n  Function:  Present structured, summarized information about aspects of business important to executives.

n  Example:  Status of production by product.

n  Supports:  Top managers of the organization.

New (Consultative) IS Functions

w  Initiating and designing specific strategic IS.

w  Incorporating the Internet and e-commerce into the business.

w  Managing system integration including the Internet, intranets and extranets.

w  Educating the non-IS managers about IT

w  Educating the IS staff about the business

w  Supporting end user computing.

w  Partnering with the executives.

w  Managing outsourcing.

w  Proactively using business and technical knowledge to “seed” innovative ideas about IT.

w  Creating business alliances with vendors and IS departments in other organizations.

IT Offers Career Opportunities

w  The demand for traditional IT staff – such as programmers, business analysts, systems analysts and designers – is substantial.

w  In addition, well-paid jobs in Internet and e-commerce, mobile commerce, network, security, object-oriented programming, telecommunications and multimedia design are available too.