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 Business Driven
Information Systems
 Paige Baltzan
Daniels College of Business, University of Denver

Business Driven
Information Systems
FIFTH EDITION
BUSINESS DRIVEN INFORMATION SYSTEMS, FIFTH EDITION

Published by McGraw-Hill Education, 2 Penn Plaza, New York, NY 10121. Copyright © 2016 by McGraw-Hill
Education. All rights reserved. Printed in the United States of America. Previous editions © 2014, 2012, 2009.
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Library of Congress Cataloging-in-Publication Data

Baltzan, Paige.
Business driven information systems/Paige Baltzan, Daniels College of Business, University
of Denver.—FIFTH EDITION.
pages cm
ISBN 978-0-07-340298-7 (alk. paper)
1. Information technology—Management. 2. Industrial management—Data processing. I. Title.
HD30.2.B357 2016
658.4’038011—dc23
2014047207

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not indicate an endorsement by the authors or McGraw-Hill Education, and McGraw-Hill Education does not
guarantee the accuracy of the information presented at these sites.

www.mhhe.com
D E D I C AT I O N

To Tony, Hannah, Sophie, and Gus:

What do you always remember?
That I Love You! That I’m Proud of You!
Paige
 BRIEF CONTENTS

MODU LE 1 Business Driven MIS

Chapter 1 Management Information Systems: Business Driven MIS
Chapter 2 Decisions and Processes: Value Driven Business
Chapter 3 Ebusiness: Electronic Business Value
Chapter 4 Ethics and Information Security: MIS Business Concerns

MODU LE 2 Technical Foundations of MIS

Chapter 5 Infrastructures: Sustainable Technologies
Chapter 6 Data: Business Intelligence
Chapter 7 Networks: Mobile Business

MODU LE 3 Enterprise MIS

Chapter 8 Enterprise Applications: Business Communications
Chapter 9 Systems Development and Project Management: Corporate
Responsibility

APPEN DIX
Appendix A Hardware and Software Basics
Appendix B Networks and Telecommunications
Appendix C Designing Databases

Apply Your Knowledge

Glossary
Notes
Credits
Index

vi Brief Contents

mo dule 1
B u s in ess Driv en MIS
CHAPT ER 1
Management Information Systems:
Business Driven MIS 2
Opening Case Study: T h e I nter net
o f Th in gs 3
Section 1.1 Business Driven MIS 5
COMPETING IN THE INFORMATION AGE 5
Data 6
Information 8
Business Intelligence 8
Knowledge 9
THE CHALLENGE OF DEPARTMENTAL COMPANIES
AND THE MIS SOLUTION 11
The MIS Solution 12
Systems Thinking 14
MIS Department Roles and Responsibilities 14
Section 1.2 Business Strategy 15
IDENTIFYING COMPETITIVE ADVANTAGES 15
Swot Analysis: Understanding Business Strategies
THE FIVE FORCES MODEL—EVALUATING
INDUSTRY ATTRACTIVENESS 19
Buyer Power 20
Supplier Power 20
Threat of Substitute Products or Services 21
Threat of New Entrants 21
Rivalry among Existing Competitors 21
Analyzing the Airline Industry 22
THE THREE GENERIC STRATEGIES—CHOOSING
A BUSINESS FOCUS 23
VALUE CHAIN ANALYSIS—EXECUTING
BUSINESS STRATEGIES 25
Learning Outcome Review 28
Opening Case Questions 30
Key Terms 30
Review Questions 30
Closing Case One: The World Is Flat:
Thomas Friedman 31
Closing Case Two: Crushing Candy 32
Critical Business Thinking 33
CONTENTS
Entrepreneurial Challenge 36
Apply Your Knowledge Business Projects 37
AYK Application Projects 41
1
C H AP TER 2
Decisions and Processes:
Value Driven Business 42
Opening Case Study: Business
Is Booming for Wearable
Technologies 43
Section 2.1 Decision Support Systems 45
MAKING ORGANIZATIONAL BUSINESS
DECISIONS 45
The Decision-Making Process 46
Decision-Making Essentials 46
MEASURING ORGANIZATIONAL BUSINESS
DECISIONS 48
Efficiency and Effectiveness Metrics 49
USING MIS TO MAKE BUSINESS DECISIONS 51
Operational Support Systems 52
Managerial Support Systems 53
Strategic Support Systems 55
USING AI TO MAKE BUSINESS DECISIONS 58
17 Expert Systems 59
Neural Networks 60
Genetic Algorithms 60
Intelligent Agents 61
Virtual Reality 62
Section 2.2 Business Processes 62
MANAGING BUSINESS PROCESSES 62
Business Process Modeling 65
USING MIS TO IMPROVE BUSINESS PROCESSES 67
Operational Business Processes—Automation 68
Managerial Business Processes—Streamlining 70
Strategic Business Processes—Reengineering 71
Learning Outcome Review 77
Opening Case Questions 79
Key Terms 79
Review Questions 80
Closing Case One: Political Micro-Targeting: What
Decision Support Systems Did for Barack Obama 80
Closing Case Two: Action Finally—Actionly 82
Critical Business Thinking 84
Entrepreneurial Challenge 85
Contents vii
 Apply Your Knowledge Business Projects 86
AYK Application Projects 90
CHA PT ER 3
Ebusiness: Electronic Business
Value 91
Opening Case Study: B it c oin 92
Section 3.1 Web 1.0: Ebusiness 93
DISRUPTIVE TECHNOLOGY 93
Disruptive versus Sustaining Technology 93
The Internet and World Wide Web—The Ultimate
Business Disruptors 94
WEB 1.0: THE CATALYST FOR EBUSINESS 94
Expanding Global Reach 97
Opening New Markets 97
Reducing Costs 97
Improving Effectiveness 99
THE FOUR EBUSINESS MODELS 100
Business-to-Business (B2B) 100
Business-to-Consumer (B2C) 101
Consumer-to-Business (C2B) 101
Consumer-to-Consumer (C2C) 102
Ebusiness Forms and Revenue-Generating
Strategies 102
EBUSINESS TOOLS FOR CONNECTING
AND COMMUNICATING 103
Email 103
Instant Messaging 105
Podcasting 105
Videoconferencing 105
Web Conferencing 105
Content Management Systems 105
THE CHALLENGES OF EBUSINESS 106
Identifying Limited Market Segments 106
Managing Consumer Trust 106
Ensuring Consumer Protection 106
Adhering to Taxation Rules 107
Section 3.2 Web 2.0: Business 2.0 107
WEB 2.0: ADVANTAGES OF BUSINESS 2.0 107
Content Sharing Through Open Sourcing 108
User-Contributed Content 108
Collaboration Inside the Organization 109
Collaboration Outside the Organization 109
NETWORKING COMMUNITIES WITH BUSINESS 2.0 110
Social Tagging 111
BUSINESS 2.0 TOOLS FOR COLLABORATING 113
Blogs 113
Wikis 114
Mashups 114
THE CHALLENGES OF BUSINESS 2.0 115
Technology Dependence 115
Information Vandalism 116
Violations of Copyright and Plagiarism 116
viii Contents
WEB 3.0: DEFINING THE NEXT GENERATION
OF ONLINE BUSINESS OPPORTUNITIES 116
Egovernment: The Government Moves Online 117
Mbusiness: Supporting Anywhere Business 118
Learning Outcome Review 118
Opening Case Questions 120
Key Terms 121
Review Questions 121
Closing Case One: Social Media and Ashton
Kutcher 122
Closing Case Two: Pinterest—Billboards for the
Internet 123
Critical Business Thinking 125
Entrepreneurial Challenge 128
Apply Your Knowledge Business Projects 128
AYK Application Projects 132
C H AP TER 4
Ethics and Information Security:
MIS Business Concerns 133
Opening Case Study: Five Ways
Hackers Can Get Into Your
Business 134
Section 4.1 Ethics 136
INFORMATION ETHICS 136
Information Does Not Have Ethics, People Do 137
DEVELOPING INFORMATION MANAGEMENT
POLICIES 139
Ethical Computer Use Policy 140
Information Privacy Policy 141
Acceptable Use Policy 141
Email Privacy Policy 142
Social Media Policy 143
Workplace Monitoring Policy 144
Section 4.2 Information Security 146
PROTECTING INTELLECTUAL ASSETS 146
Security Threats Caused by Hackers
and Viruses 147
THE FIRST LINE OF DEFENSE—PEOPLE 149
THE SECOND LINE OF DEFENSE—TECHNOLOGY 150
People: Authentication and Authorization 150
Data: Prevention and Resistance 153
Attack: Detection and Response 154
Learning Outcome Review 155
Opening Case Questions 156
Key Terms 157
Review Questions 157
Closing Case One: Targeting Target 158
Closing Case Two: To Share—Or Not to Share 159
Critical Business Thinking 162
Entrepreneurial Challenge 164
Apply Your Knowledge Business Projects 164
AYK Application Projects 168

mo dule 2
Technical Foundations of MIS
CHAPT ER 5
Infrastructures: Sustainable
Technologies 170
Opening Case Study: B ox Up
Yo u r D a t a 1 7 1
Section 5.1 MIS Infrastructures 174
THE BUSINESS BENEFITS OF A SOLID MIS
INFRASTRUCTURE 174
SUPPORTING OPERATIONS: INFORMATION MIS
INFRASTRUCTURE 175
Backup and Recovery Plan 176
Disaster Recovery Plan 177
Business Continuity Plan 179
SUPPORTING CHANGE: AGILE MIS INFRASTRUCTURE 180
Accessibility 181
Availability 182
Maintainability 183
Portability 183
Reliability 183
Scalability 184
Usability 185
Section 5.2 Building Sustainable MIS Infrastructures 185
MIS AND THE ENVIRONMENT 185
Increased Electronic Waste 186
Increased Energy Consumption 187
Increased Carbon Emissions 187
SUPPORTING THE ENVIRONMENT: SUSTAINABLE MIS
INFRASTRUCTURE 187
Grid Computing 188
Virtualized Computing 190
Cloud Computing 192
Learning Outcome Review 199
Opening Case Questions 200
Key Terms 201
Review Questions 201
Closing Case One: UPS Invests $1 Billion to Go Green 202
Closing Case Two: Pandora’s Music Box 203
Critical Business Thinking 204
Entrepreneurial Challenge 205
Apply Your Knowledge Business Projects 206
AYK Application Projects 210
CHAPT ER 6
Data: Business Intelligence 211
Opening Case Study: Infor mi ng
I n form a t ion 2 1 2
Section 6.1 Data, Information, and Databases
THE BUSINESS BENEFITS OF HIGH-QUALITY INFORMATION 215
Information Type: Transactional and Analytical 215
Information Timeliness 217
169 Information Quality 217
Information Governance 220
STORING INFORMATION USING A RELATIONAL DATABASE
MANAGEMENT SYSTEM 220
Storing Data Elements in Entities and Attributes 222
Creating Relationships Through Keys 222
Coca Cola Relational Database Example 223
USING A RELATIONAL DATABASE FOR BUSINESS
ADVANTAGES 225
Increased Flexibility 225
Increased Scalability and Performance 225
Reduced Information Redundancy 226
Increased Information Integrity (Quality) 226
Increased Information Security 226
DRIVING WEBSITES WITH DATA 227
Section 6.2 Business Intelligence 229
SUPPORTING DECISIONS WITH BUSINESS
INTELLIGENCE 229
The Problem: Data Rich, Information Poor 229
The Solution: Business Intelligence 230
THE BUSINESS BENEFITS OF DATA WAREHOUSING 231
DATA MARTS 232
Multidimensional Analysis 234
Information Cleansing or Scrubbing 234
THE POWER OF BIG DATA ANALYTICS 237
Data Mining 238
Data Analytics 240
Data Visualization 241
Learning Outcome Review 243
Opening Case Questions 244
Key Terms 245
Review Questions 245
Closing Case One: Data Visualization: Stories for the
Information Age 246
Closing Case Two: Zillow 247
Critical Business Thinking 248
Entrepreneurial Challenge 250
Apply Your Knowledge Business Projects 250
AYK Application Projects 253
C H AP TER 7
Networks: Mobile Business 254
Opening Case Study: Disrupting
the Taxi: Uber 255
Section 7.1 Connectivity: The Business Value
of a Networked World 257
OVERVIEW OF A CONNECTED WORLD 257
Network Categories 258
Network Providers 258
215 Network Access Technologies 259
Contents ix
 Network Protocols 262 Drones Support Logistics 308
Network Convergence 264 Robotics Supports Materials Management 308
BENEFITS OF A CONNECTED WORLD 266 The Extended Supply Chain 309
CHALLENGES OF A CONNECTED WORLD 269 Section 8.2 Customer Relationship Management
Security 269 and Enterprise Resource Planning 311
Social, Ethical, and Political Issues 269 CUSTOMER RELATIONSHIP MANAGEMENT 311
Section 7.2 Mobility: The Business Value The Power of the Customer 312
of a Wireless World 270 Measuring CRM Success 312
WIRELESS NETWORK CATEGORIES 270 CRM Communication Channels 312
Personal Area Networks 271 THE BENEFITS OF CRM 312
Wireless LANs 272 Evolution of CRM 314
Wireless MANs 273 Operational and Analytical CRM 316
Wireless WAN—Cellular Communication System 274 Marketing and Operational CRM 317
Wireless WAN—Satellite Communication System 276 Sales and Operational CRM 318
Protecting Wireless Connections 277 Customer Service and Operational CRM 319
Managing Mobile Devices 278 Analytical CRM 320
BUSINESS APPLICATIONS OF WIRELESS NETWORKS 278 EXTENDING CUSTOMER RELATIONSHIP MANAGEMENT 321
Radio-Frequency Identification (RFID) 279 ENTERPRISE RESOURCE PLANNING 322
Global Positioning System (GPS) 280 Core ERP Components 324
Geographic Information Systems (GIS) 280 Extended ERP Components 327
Learning Outcome Review 283 Measuring ERP Success 327
Opening Case Questions 284 ORGANIZATIONAL INTEGRATION WITH ERP 329
Key Terms 284 Mobile ERP 329
Review Questions 285 Cloud ERP and SaaS ERP 330
Closing Case One: Wireless Bikes 285 Tiered ERP Architectures 330
Closing Case Two: Square: Wireless Payments to an iPhone, Learning Outcome Review 332
Android, or iPad 286 Opening Case Questions 334
Critical Business Thinking 287 Key Terms 334
Entrepreneurial Challenge 289 Review Questions 334
Apply Your Knowledge Business Projects 290 Closing Case One: Zappos Is Passionate for Customers 335
AYK Application Projects 293 Closing Case Two: Got Milk? It’s Good for You—Unless
It’s Contaminated! 336
Critical Business Thinking 338
mo d u le 3 Entrepreneurial Challenge 340
Apply Your Knowledge Business Projects 341
En t e r p r i se MIS 294
AYK Application Projects 344

CHA PT ER 8 C H AP TER 9
Enterprise Applications: Business Systems Development and Project
Communications 295 Management: Corporate Responsibility 345
Opening Case Study: D rea m I t , Opening Case Study: Getti ng You r
D e s i g n I t , 3 D Print It 2 9 6 P roj ect on Tr ack 346
Section 8.1 Supply Chain Management 298 Section 9.1 Developing Enterprise Applications 349
BUILDING A CONNECTED CORPORATION THE SYSTEMS DEVELOPMENT LIFE CYCLE (SDLC) 349
THROUGH INTEGRATIONS 298 Phase 1: Planning 349
Integration Tools 299 Phase 2: Analysis 350
SUPPLY CHAIN MANAGEMENT 300 Phase 3: Design 353
Visibility into the Supply Chain 302 Phase 4: Development 353
TECHNOLOGIES REINVENTING THE SUPPLY CHAIN 304 Phase 5: Testing 354
3D Printing Supports Procurement 306 Phase 6: Implementation 354
RFID Supports Logistics 307 Phase 7: Maintenance 355

x Contents
SOFTWARE DEVELOPMENT METHODOLOGY: Output Devices A.8
THE WATERFALL 356 Communication Devices A.9
AGILE SOFTWARE DEVELOPMENT METHODOLOGIES 359 COMPUTER CATEGORIES A.9
Rapid Application Development (RAD) Methodology 360 SOFTWARE BASICS A.12
Extreme Programming Methodology 360 System Software A.12
Rational Unified Process (RUP) Methodology 360 Application Software A.13
Scrum Methodology 361 Distributing Application Software A.14
DEVELOPING A SERVICE-ORIENTED ARCHITECTURE 361 Key Terms A.15
Service 361 Apply Your Knowledge A.15
Interoperability 363
Loose Coupling 363 AP PE N D IX B
Section 9.2 Project Management 364 Networks and Telecommunications B.1
USING PROJECT MANAGEMENT TO DELIVER INTRODUCTION B.1
SUCCESSFUL PROJECTS 364 NETWORK BASICS B.1
Unclear or Missing Business Requirements 366 ARCHITECTURE B.3
Skipped Phases 366 Peer-to-Peer Networks B.3
Changing Technology 367 Client/Server Networks B.4
The Cost of Finding Errors in the SDLC 367 TOPOLOGY B.5
Balance of the Triple Constraint 367 PROTOCOLS B.6
PRIMARY PROJECT PLANNING DIAGRAMS 369 Ethernet B.6
OUTSOURCING PROJECTS 372 Transmission Control Protocol/Internet Protocol B.7
Outsourcing Benefits 373 MEDIA B.8
Outsourcing Challenges 374 Wire Media B.8
Learning Outcome Review 376 Wireless Media B.9
Opening Case Questions 377 Key Terms B.10
Key Terms 378 Apply Your Knowledge B.10
Review Questions 378
Closing Case One: Disaster at Denver International AP PE N D IX C
Airport 379 Designing Databases C.1
Closing Case Two: Reducing Ambiguity in Business
INTRODUCTION C.1
Requirements 380
THE RELATIONAL DATABASE MODEL C.1
Critical Business Thinking 381
Entities and Attributes C.2
Entrepreneurial Challenge 382
Business Rules C.3
Apply Your Knowledge Business Projects 383
DOCUMENTING ENTITY RELATIONSHIP DIAGRAMS C.3
AYK Application Projects 387
Basic Entity Relationships C.4
Relationship Cardinality C.6
RELATIONAL DATA MODEL AND THE DATABASE C.7
a ppe ndic e s From Entities to Tables C.7
Logically Relating Tables C.8
Key Terms C.9
APPEN DIX A
Apply Your Knowledge C.9
Hardware and Software Basics A.1
INTRODUCTION A.1 Apply Your Knowledge AYK.1
HARDWARE BASICS A.1 Glossary G.1
Central Processing Unit A.2 Notes N.1
Primary Storage A.3 Credits C-1
Secondary Storage A.5 Index I.1
Input Devices A.7

Contents xi
 P R E FA C E
Business Driven Information Systems discusses various business initiatives first and how
technology supports those initiatives second. The premise for this unique approach is that
business initiatives should drive technology choices. Every discussion first addresses the
business needs and then addresses the technology that supports those needs. This text pro-
vides the foundation that will enable students to achieve excellence in business, whether they
major in operations management, manufacturing, sales, marketing, finance, human resources,
accounting, or virtually any other business discipline. Business Driven Information Systems is
designed to give students the ability to understand how information technology can be a point
of strength for an organization.
Common business goals associated with information technology projects include reduc-
ing costs, improving productivity, improving customer satisfaction and loyalty, creating com-
petitive advantages, streamlining supply chains, global expansion, and so on. Achieving these
results is not easy. Implementing a new accounting system or marketing plan is not likely to
generate long-term growth or reduce costs across an entire organization. Businesses must
undertake enterprisewide initiatives to achieve broad general business goals such as reducing
costs. Information technology plays a critical role in deploying such initiatives by facilitating
communication and increasing business intelligence. Any individual anticipating a successful
career in business whether it is in accounting, finance, human resources, or operation man-
agement must understand the basics of information technology that can be found in this text.
We have found tremendous success teaching MIS courses by demonstrating the correla-
tion between business and IT. Students who understand the tight correlation between business
and IT understand the power of this course. Students learn 10 percent of what they read,
80 percent of what they personally experience, and 90 percent of what they teach others. The
business driven approach brings the difficult and often intangible MIS concepts to the stu-
dent’s level and applies them using a hands-on approach to reinforce the concepts. Teaching
MIS with a business driven focus helps:
■ Add credibility to IT.
■ Open students’ eyes to IT opportunities.
■ Attract majors.
■ Engage students.

FORMAT, FEATURES, AND HIGHLIGHTS

Business Driven Information Systems is state of the art in its discussions, presents concepts
in an easy-to-understand format, and allows students to be active participants in learning. The
dynamic nature of information technology requires all students, more specifically business stu-
dents, to be aware of both current and emerging technologies. Students are facing complex
subjects and need a clear, concise explanation to be able to understand and use the concepts
throughout their careers. By engaging students with numerous case studies, exercises, projects,
and questions that enforce concepts, Business Driven Information Systems creates a unique
learning experience for both faculty and students.
■ Audience. Business Driven Information Systems is designed for use in undergraduate or
introductory MBA courses in management information systems, which are required in
many business administration or management programs as part of the common body of
knowledge for all business majors.
■ Logical Layout. Students and faculty will find the text well organized with the topics
flowing logically from one chapter to the next. The definition of each term is provided
before it is covered in the chapter, and an extensive glossary is included at the back of the
text. Each chapter offers a comprehensive opening case study, learning outcomes, closing
case studies, key terms, and critical business thinking questions.

xii Preface
■ Thorough Explanations. Complete coverage is provided for each topic that is introduced.
Explanations are written so that students can understand the ideas presented and relate
them to other concepts.
■ Solid Theoretical Base. The text relies on current theory and practice of information sys-
tems as they relate to the business environment. Current academic and professional jour-
nals cited throughout the text are found in the Notes at the end of the book—a road map
for additional, pertinent readings that can be the basis for learning beyond the scope of the
chapters or plug-ins.
■ Material to Encourage Discussion. All chapters contain a diverse selection of case stud-
ies and individual and group problem-solving activities as they relate to the use of informa-
tion technology in business. Two comprehensive cases at the end of each chapter reinforce
content. These cases encourage students to consider what concepts have been presented
and then apply those concepts to a situation they might find in an organization. Different
people in an organization can view the same facts from different points of view, and the
cases will force students to consider some of those views.
■ Flexibility in Teaching and Learning. Although most textbooks that are text only leave
faculty on their own when it comes to choosing cases, Business Driven Information
Systems goes much further. Several options are provided to faculty with case selections
from a variety of sources, including CIO, Harvard Business Journal, Wired, Forbes, and
Time, to name just a few. Therefore, faculty can use the text alone, the text and a complete
selection of cases, or anything in between.
■ Integrative Themes. Several integrative themes recur throughout the text, which adds
integration to the material. Among these themes are value-added techniques and methodol-
ogies, ethics and social responsibility, globalization, and gaining a competitive advantage.
Such topics are essential to gaining a full understanding of the strategies that a business
must recognize, formulate, and in turn implement. In addition to addressing these in the
chapter material, many illustrations are provided for their relevance to business practice.

Preface xiii
 WALKTHROUGH

Learning Outcomes

Learning Outcomes. These outcomes focus on what

students should learn and be able to answer upon
completion of the chapter.

section 3.1 Web 1.0: Ebusiness

LEARNING OUTCOMES

3.1 Compare disruptive and sustaining technologies and explain how the Internet and WWW caused
business disruption.
3.2 Describe ebusiness and its associated advantages.
3.3 Compare the four ebusiness models.
3.4 Describe the six ebusiness tools for connecting and communicating.
3.5 Identify the four challenges associated with ebusiness.

xiv Walkthrough
Chapter Opening Case Study and Opening Case Questions

Chapter Opening Case Study. To enhance student interest, each chapter begins
with an opening case study that highlights an organization that has been time-tested
and value-proven in the business world. This feature serves to fortify concepts with
relevant examples of outstanding companies. Discussion of the case is threaded
throughout the chapter.

opening case study

The Internet of Things

Who are your best and worst customers? Who are your best and worst sales representa-
tives? How much inventory do you need to meet demand? How can you increase sales or
reduce costs? These are the questions you need to answer to run a successful business,
and answering them incorrectly can lead directly to business failure. In the past few years,
data collection and analytic technologies have been collecting massive amounts of data
that can help answer these critical business questions. The question now becomes whether
you have the right technical skills to collect and analyze your data.
Imagine your toothbrush telling you to visit your dentist because it senses a cavity. How
would you react if your refrigerator placed an order at your local grocery store because your
milk and eggs when about to expire? Over 20 years ago, a few professors at Massachusetts
Institute of Technology (MIT) began describing the Internet of Things (IoT), which is a world
where interconnected, Internet-enabled devices or “things” can collect and share data

Opening Case Questions. Located at the end of the chapter, poignant questions
connect the chapter opening case with important chapter concepts.

OPENING CASE QUESTIONS

1. Knowledge: Explain the Internet of Things and list three IoT devices.
2. Comprehension: Explain why it is important for business managers to understand that data col-
lection rates from IoT devices is increasing exponentially.
3. Application: Demonstrate how data from an IoT device can be transformed into information and
business intelligence.
4. Analysis: Analyze the current security issues associated with IoT devices.
5. Synthesis: Propose a plan for how a start-up company can use IoT device data to make better
business decisions.
Untitled-2 3 1/16/15 9:13 AM

Walkthrough xv
 Projects and Case Studies

Case Studies. This text is packed with 27 case studies illustrating how a variety of prominent organizations and
businesses have successfully implemented many of this text’s concepts. All cases are timely and promote critical
thinking. Company profiles are especially appealing and relevant to your students, helping to stir classroom discus-
sion and interest.

Apply Your Knowledge. At the end of each chapter you will find several Apply Your Knowledge projects that challenge
students to bring the skills they have learned from the chapter to real business problems. There are also 33 Apply Your
Knowledge projects on the OLC that accompanies this text (www.mhhe.com/baltzan) that ask students to use IT
tools such as Excel, Access, and Dreamweaver to solve business problems. These projects help to develop the applica-
tion and problem-solving skills of your students through challenging and creative business-driven scenarios.

e os e c e a d e ec e a e

A P P LY Y O U R K N O W L E D G E B U S I N E S S P R O J E C T S

PROJ ECT I Making Business Decisions

You are the vice president of human resources for a large consulting company. You are compiling a
list of questions that you want each job interviewee to answer. The first question on your list is, “How
can MIS enhance your ability to make decisions at our organization?” Prepare a one-page report to
answer this question.

PROJ ECT II DSS and EIS

Dr. Rosen runs a large dental conglomerate—Teeth Doctors—that employs more than 700 dentists
in six states. Dr. Rosen is interested in purchasing a competitor called Dentix that has 150 dentists

Untitled-3 86 1/16/15 9:26 AM

xvi Walkthrough
End-of-Chapter Elements
Each chapter contains complete pedagogical support in the form of:

KEY TERMS
Key Terms. With page
numbers referencing Business intelligence (BI), 8
Business process, 23
where they are discussed Business strategy, 15
Buyer power, 18
in the text. Chief information officer
(CIO), 15
Chief knowledge officer
(CKO), 15
Fact, 5 Product differentiation, 20
Feedback, 14 Rivalry among existing
First-mover advantage, 17 competitors, 20
Goods, 12 Services, 12
Information, 7 Supplier power, 19
Information age, 5 Supply chain, 19
Knowledge, 10 Support value activities, 24
Knowledge worker, 10 Switching costs, 18

Two Closing Case Studies. CLOSING CASE ONE

Reinforcing important concepts
with prominent examples from
businesses and organizations.
Discussion questions follow each
case study.
The World Is Flat: Thomas Friedman
Christopher Columbus proved in 1492 that the world is round. For centuries, sailors maneuvered the
seas, discovering new lands, new people, and new languages as nations began trading goods around
the globe. Then Thomas Friedman, a noted columnist for The New York Times, published his book The
World Is Flat.

Critical Business Thinking. The best way to learn MIS is to apply it to scenarios and real-world business
dilemmas. These projects require students to apply critical thinking skills and chapter concepts to analyze
the problems and make recommended business decisions.

CRITICAL BUSINESS THINKING

1. Modeling a Business Process

Do you hate waiting in line at the grocery store? Do you find it frustrating when you go to the video
rental store and cannot find the movie you wanted? Do you get annoyed when the pizza delivery
baL76892_ch01_001-041.indd 29 05/10/12
person brings you the wrong order? This is your chance to reengineer the process that drives you

Entrepreneurial Challenge. This unique feature represents a running project that allows students to chal-
lenge themselves by applying the MIS concepts to a real business. The flexibility of the case allows each
student to choose the type of business he or she would like to operate throughout the case. Each chapter
provides hands-on projects your students can work with their real-business scenarios.

ENTREPRENEURIAL CHALLENGE

BUILD YO UR O WN BUSINESS

1. You realize that you need a digital dashboard to help you operate your business. Create a list of
all of the components you would want to track in your digital dashboard that would help you run
your business. Be sure to justify how each component would help you gain insight into the opera-
Untitled-6 31 1/16/15
tions of your business and flag potential issues that could ruin your business. (Be sure to identify

Walkthrough xvii
 About the Plug-Ins

Located on the OLC that accompanies this text (www.mhhe.com/baltzan), the overall goal of the plug-ins
is to provide an alternative for faculty who find themselves in the situation of having to purchase an extra
book to support Microsoft Office 2010 or 2013. The plug-ins presented here offer integration with the core
chapters and provide critical knowledge using essential business applications, such as Microsoft Excel,
Microsoft Access, DreamWeaver, and Microsoft Project. Each plug-in uses hands-on tutorials for compre-
hension and mastery.

Plug-In
T1. Personal Productivity Using IT
Description
This plug-in covers a number of things to do to keep a personal computer running effectively
and efficiently. The 12 topics covered in this plug-in are:
■ Creating strong passwords.
■ Performing good file management.
■ Implementing effective backup and recovery strategies.
■ Using Zip files.
■ Writing professional emails.
■ Stopping spam.
■ Preventing phishing.
■ Detecting spyware.
■ Threads to instant messaging.
■ Increasing PC performance.
■ Using antivirus software.
■ Installing a personal firewall.

End-of-Plug-In Elements

Each plug-in contains complete pedagogical support in the form of:

Plug-In Summary. Revisits the plug-in highlights in summary format.
Making Business Decisions. Small scenario-driven projects that help students focus individually on
decision making as they relate to the topical elements in the chapters.

T2. Basic Skills Using Excel
This plug-in introduces the basics of using Microsoft Excel, a spreadsheet program for data
analysis, along with a few fancy features. The six topics covered in this plug-in are:
■ Workbooks and worksheets.
■ Working with cells and cell data.
■ Printing worksheets.
■ Formatting worksheets.
■ Formulas.
■ Working with charts and graphics.

T4. Decision Making Using Excel This plug-in examines a few of the advanced business analysis tools used in Microsoft Excel
that have the capability to identify patterns, trends, and rules, and create “what-if” models.
The four topics covered in this plug-in are:
■ IF
■ Goal Seek
■ Solver
baL76892_plugins_T1-T4.indd 1 1/29/15 9:46 AM
■ Scenario Manager

xviii Walkthrough
baL76892_plugins_T1-T4.indd 1 1/29/15 9:46 AM
Support and Supplemental Material
All of the supplemental material supporting Business Driven Information Systems was developed by the author to
ensure that you receive accurate, high-quality, and in-depth content. Included is a complete set of materials that
will assist students and faculty in accomplishing course objectives.
Video Exercises. Each of the videos that accompany the text is supported by detailed teaching notes on how to
turn the videos into classroom exercises to which your students can apply the knowledge they are learning after
watching the videos.
Test Bank. This computerized package allows instructors to custom design, save, and generate tests. The test
program permits instructors to edit, add, or delete questions from the test banks; analyze test results; and organize
a database of tests and students’ results.
Instructor’s Manual (IM). The IM, written by the author, includes suggestions for designing the course and
presenting the material. Each chapter is supported by answers to end-of-chapter questions and problems, and
suggestions concerning the discussion topics and cases.
PowerPoint Presentations. A set of PowerPoint slides, created by the author, accompanies each chapter and fea-
tures bulleted items that provide a lecture outline, plus key figures and tables from the text, and detailed teaching
notes on each slide.
Image Library. Text figures and tables, as permission allows, are provided in a format by which they can be
imported into PowerPoint for class lectures.
Project Files. The author has provided files for all projects that need further support, such as data files.

Walkthrough xix
 Tegrity Campus: Lectures 24/7

Tegrity Campus is a service that makes class time available 24/7 by automatically capturing every lecture in a
searchable format for students to review when they study and complete assignments. With a simple one-click
start-and-stop process, you capture all computer screens and corresponding audio. Students can replay any part
of any class with easy-to-use browser-based viewing on a PC or Mac.
Educators know that the more students can see, hear, and experience class resources, the better they learn. In
fact, studies prove it. With Tegrity Campus, students quickly recall key moments by using Tegrity Campus’s unique
search feature. This search helps students efficiently find what they need, when they need it, across an entire
semester of class recordings. Help turn all your students’ study time into learning moments immediately supported
by your lecture.
To learn more about Tegrity, watch a two-minute Flash demo at http://tegritycampus.mhhe.com.

Assurance of Learning Ready

Many educational institutions today are focused on the notion of assurance of learning, an important element of
some accreditation standards. Business Driven Information Systems is designed specifically to support your assur-
ance of learning initiatives with a simple, yet powerful solution.
Each test bank question for Business Driven Information Systems maps to a specific chapter learning outcome/
objective listed in the text. You can use our test bank software, EZ Test and EZ Test Online, or in Connect MIS to
query easily for learning outcomes/objectives that directly relate to the learning objectives for your course. You can
then use the reporting features of EZ Test to aggregate student results in similar fashion, making the collection and
presentation of assurance of learning data simple and easy.

AACSB Statement
The McGraw-Hill Companies is a proud corporate member of AACSB International. Understanding the importance
and value of AACSB accreditation, Business Driven Information Systems recognizes the curricula guidelines
detailed in the AACSB standards for business accreditation by connecting selected questions in the test bank to the
six general knowledge and skill guidelines in the AACSB standards.
The statements contained in Business Driven Information Systems are provided only as a guide for the users of
this textbook. The AACSB leaves content coverage and assessment within the purview of individual schools, the
mission of the school, and the faculty. Although Business Driven Information Systems and the teaching package
make no claim of any specific AACSB qualification or evaluation, within Business Driven Information Systems we
have labeled selected questions according to the six general knowledge and skills areas.

xx Walkthrough
McGraw-Hill Customer Care Contact Information
At McGraw-Hill, we understand that getting the most from new technology can be challenging. That’s why our
services don’t stop after you purchase our products. You can email our product specialists 24 hours a day to get
product training online. Or you can search our knowledge bank of Frequently Asked Questions on our support
website. For Customer Support, call 800-331-5094 or visit www.mhhe.com/support where you can look for
your question on our FAQ, or you can email a question directly to customer support. One of our technical support
analysts will be able to assist you in a timely fashion.

Walkthrough xxi
 Apply Your Knowledge
Business Driven Information Systems contains 33 projects that focus on student application of core concepts and tools.
These projects can be found on the OLC at www.mhhe.com/baltzan.

Project Page
Number Project Name Project Type Plug-In Focus Area Project Level Skill Set Number

1 Financial Excel T2 Personal Introductory Formulas AYK.4

Destiny Budget
2 Cash Flow Excel T2 Cash Flow Introductory Formulas AYK.4
3 Technology Excel T1, T2 Hardware and Introductory Formulas AYK.4
Budget Software
4 Tracking Excel T2 Employee Introductory Formulas AYK.4
Donations Relationships
5 Convert Excel T2 Global Introductory Formulas AYK.5
Currency Commerce
6 Cost Excel T2 Total Cost of Introductory Formulas AYK.5
Comparison Ownership
7 Time Excel or Project T12 Project Introductory Gantt Charts AYK.6
Management Management
8 Maximize Excel T2, T4 Strategic Intermediate Formulas or AYK.6
Profit Analysis Solver
9 Security Excel T3 Filtering Data Intermediate Conditional AYK.7
Analysis Formatting,
Autofilter,
Subtotal
10 Gathering Excel T3 Data Intermediate Conditional AYK.8
Data Analysis Formatting
11 Scanner Excel T2 Strategic Intermediate Formulas AYK.8
System Analysis
12 Competitive Excel T2 Profit Intermediate Formulas AYK.9
Pricing Maximization
13 Adequate Excel T2 Break-Even Intermediate Formulas AYK.9
Acquisitions Analysis
14 Customer Excel T3 CRM Intermediate PivotTable AYK.9
Relations
15 Assessing Excel T3 Data Intermediate PivotTable AYK.10
the Value of Analysis
Information
16 Growth, Excel T2, T3 Data Advanced Average, AYK.11
Trends, and Forecasting Trend, Growth
Forecasts
17 Shipping Costs Excel T4 SCM Advanced Solver AYK.12
18 Formatting Excel T3 Data Advanced If, LookUp AYK.12
Grades Analysis

(Continued )

xxii Walkthrough
Project Page
Number Project Name Project Type Plug-In Focus Area Project Level Skill Set Number
19 Moving Excel T2, T3 SCM Advanced Absolute AYK.13
Dilemma vs. Relative
Values
20 Operational Excel T3 SCM Advanced PivotTable AYK.14
Efficiencies
21 Too Much Excel T3 CRM Advanced PivotTable AYK.14
Information
22 Turnover Rates Excel T3 Data Mining Advanced PivotTable AYK.15
23 Vital Excel T3 Data Mining Advanced PivotTable AYK.15
Information
24 Breaking Even Excel T4 Business Advanced Goal Seek AYK.16
Analysis
25 Profit Scenario Excel T4 Sales Advanced Scenario AYK.16
Analysis Manager
26 Electronic HTML T9, T10, Electronic Introductory Structural AYK.17
Résumés T11 Personal Tags
Marketing
27 Gathering Dreamweaver T9, T10, Data Intermediate Organization AYK.17
Feedback T11 Collection of Information
28 Daily Invoice Access T5, T6, Business Introductory Entities, AYK.17
T7, T8 Analysis Relationships,
and
Databases
29 Billing Data Access T5, T6, Business Introductory Entities, AYK.19
T7, T8 Intelligence Relationships,
and
Databases
30 Inventory Data Access T5, T6, SCM Intermediate Entities, AYK.20
T7, T8 Relationships,
and
Databases
31 Call Center Access T5, T6, CRM Intermediate Entities, AYK.21
T7, T8 Relationships,
and
Databases
32 Sales Pipeline Access T5, T6, Business Advanced Entities, AYK.23
T7, T8 Intelligence Relationships,
and
Databases
33 Online Classified Access T5, T6, Ecommerce Advanced Entities, AYK.23
Ads T7, T8 Relationships,
and
Databases

Walkthrough xxiii
 SimNet Online is McGraw-Hill’s leading solution for learning Microsoft Office skills and beyond! SimNet is our online
training and assessment solution for Microsoft Office skills, computing concepts, Internet Explorer, and Windows
content. With no downloads for installation and completely online (requires Adobe Flash Player), SimNet is accessible
for today’s students through multiple browsers and is easy to use for all. Its consistent user interface and functional-
ity will help save you time and help you be more successful in your course.

Moreover, SimNet offers you lifelong learning. Our codes never expire and the online program is designed with Self-
Study and SimSearch features to help you immediately learn isolated Microsoft Office skills on demand. It’s more
than a resource; it’s a tool you can use throughout your entire time at your higher education institution.

Finally, you will see powerful, measurable results with SimNet Online. See results immediately in the student grade-
book and generate custom training lessons after an exam to help you determine exactly which content areas you still
need to study.

SimNet Online is your solution for mastering Microsoft Office skills!

SIMnet: Keep IT SIMple!

To learn more, visit www.simnetkeepitsimple.com

xxiv Walkthrough
McGraw-Hill Higher Education and Blackboard have teamed up. What does this mean for you?
1. Your life, simplified. Now you and your students can access McGraw-Hill’s Connect™ and Create™ right from
within your Blackboard course—all with one single sign-on. Say good-bye to the days of logging on to multiple
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2. Deep integration of content and tools. Not only do you get single sign-on with Connect™ and Create™, you
also get deep integration of McGraw-Hill content and content engines right in Blackboard. Whether you’re choos-
ing a book for your course or building Connect™ assignments, all the tools you need are right where you want
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3. Seamless Gradebooks. Are you tired of keeping multiple gradebooks and manually synchronizing grades into
Blackboard? We thought so. When a student completes an integrated Connect™ assignment, the grade for that
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4. A solution for everyone. Whether your institution is already using Blackboard or you just want to try Blackboard
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Craft your teaching resources to match the way you teach! With McGraw-Hill Create, www.mcgrawhillcreate.com, you can
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Walkthrough xxv
 ACKNOWLEDGMENTS
Working on the fifth edition of Business Driven Information Systems has been an involved
undertaking, and there are many people whom we want to heartily thank for their hard work,
enthusiasm, and dedication.
This text was produced with the help of a number of people at McGraw-Hill, including
Brand Manager Wyatt Morris and Product Developer, Allison McCabe.
In addition, we would like to thank Scott Davidson (Director), Tiffany Russell (Marketing
Manager), and Kevin White (Digital Development Editor) for your support and dedication to
the success of this text.
Finally, we offer our sincerest gratitude and deepest appreciation to our valuable reviewers
whose feedback was instrumental in successfully compiling this text. We could not have done
this without you!

Stephen Adams Brenda Bradford Biswadip Ghosh

Lakeland Community College Missouri Baptist University Metropolitan State College of Denver
Adeyemi A. Adekoya Casey Cegielski Richard Glass
Virginia State University—Petersburg Auburn University—Auburn Bryant University
Joni Adkins Amita Chin Lakshmi Goel
Northwest Missouri State University Virginia Commonwealth University University of North Florida
Chad Anderson Steve Clements Mark Goudreau
University of Nevada—Reno Eastern Oregon University Johnson & Wales University
Anne Arendt Cynthia Corritore Katie Gray
Utah Valley University Creighton University The University of Texas at Austin
Laura Atkins Dan Creed Gary Hackbarth
James Madison University Normandale Community College Northern Kentucky University
William Ayen Don Danner Shu Han
University of Colorado San Francisco State University Yeshiva University
David Bahn Sasha Dekleva Peter Haried
Metropolitan State University—St. Paul DePaul University University of Wisconsin—La Crosse
Nick Ball Robert Denker Rosie Hauck
Brigham Young University—Provo Baruch College Illinois State University
Patrick Bateman Hongwei Du Jun He
Youngstown State University California State University, East Bay University of Michigan—Dearborn
Terry Begley Kevin Duffy James Henson
Creighton University Wright State University—Dayton California State University—Fresno
Craig Beytien Annette Easton Terri Holly
University of Colorado—Boulder San Diego State University Indian River State College
Sudip Bhattacharjee Barry Floyd Scott Hunsinger
University of Connecticut California Polytechnic State University Appalachian State University
Meral Binbasioglu Valerie Frear Ted Hurewitz
Hofstra University Daytona State College Rutgers University
Joseph Blankenship Laura Frost Yan Jin
Fairmont State College Walsh College Elizabeth City State University
Beverly Bohn Don Gaber Brian Jones
Park University University of Wisconsin—Eau Claire Tennessee Technological University

xxvi Acknowledgments
Robert Judge Bill Neumann Vivek Shah
San Diego State University University of Arizona Texas State University
B. Kahn Richard Newmark Vijay Shah
Suffolk University University of Northern Colorado West Virginia University—Parkersburg
Virginia Kleist Kathleen Noce Jollean Sinclaire
West Virginia University Pennsylvania State University—Erie Arkansas State University
Meagan Knoll Gisele Olney Changsoo Sohn
Grand Valley State University University of Nebraska—Omaha St. Cloud State University
Rick Kraas Kevin Parker Toni Somers
Kalamazoo Valley Community College Idaho State University—Pocatello Wayne State University
Chetan Kumar Neeraj Parolia Denise Sullivan
California State University—San Towson University Westchester Community College
Marcos Gang Peng Yi Sun
Guolin Lai Youngstown State University California State University—San
University of Louisiana—Lafayette Julie Pettus Marcos
Jose Lepervanche Missouri State University
Mike Tarn
Florida State College—Jacksonville Craig Piercy Western Michigan University
Norman Lewis University of Georgia
Mark Thouin
Wayne State University Clint Pires The University of Texas at Dallas
Mary Lind Hamline University
Lise Urbaczewski
North Carolina A&T State University Jennifer Pitts University of Michigan—Dearborn
Steve Loy Columbus State University
Hong Wang
Eastern Kentucky University Carol Pollard North Carolina A&T State University
Joan Lumpkin Appalachian State University
Barbara Warner
Wright State University—Dayton Lara Preiser-Houy University of South Florida
Linda Lynam California State Polytechnic
University—Pomona Connie Washburn
University of Central Missouri
Georgia Perimeter College
Nicole Lytle-Kosola John Quigley
California State University—San East Tennessee State University Bruce White
Bernardino Quinnipiac University
Muhammad Razi
Garth MacKenzie Western Michigan University Raymond Whitney
University of Maryland University University of Maryland University
Lisa Rich
College College
Athens State University
Michael Martel Russell Robbins Rosemary Wild
Ohio University—Athens University of Pittsburgh California Polytechnic State University

Dana McCann Fred Rodammer Marie Wright

Central Michigan University Michigan State University Western Connecticut State University

David McCue Steve Ross Yajiong Xue

University of Maryland
Lynn McKell
Brigham Young University
Patricia McQuaid
California Polytechnic State University
Fiona Nah
University of Nebraska—Lincoln
Eric Nathan
University of Houston Downtown
Western Washington University
Mark Schmidt
St. Cloud State University
Dana Schwieger
Southeast Missouri State University
Darrell Searcy
Palm Beach Community College
Jay Shah
Texas State University
East Carolina University
Ali Yayla
Binghamton University
Grace Zhang
Midwestern State University
Lin Zhao
Purdue University—Calumet
Jeanne Zucker
East Tennessee State University

Acknowledgments xxvii
 ABOUT THE AUTHOR

Paige Baltzan
Paige Baltzan teaches in the Department of Business Information and Analytics at the
Daniels College of Business at the University of Denver. She holds a B.S.B.A. specializing
in Accounting/MIS from Bowling Green State University and an M.B.A. specializing in MIS
from the University of Denver. She is a coauthor of several books, including Business Driven
Technology, Essentials of Business Driven Information Systems, and I-Series, and a contribu-
tor to Management Information Systems for the Information Age.
Before joining the Daniels College faculty in 1999, Paige spent several years working for
a large telecommunications company and an international consulting firm, where she partici-
pated in client engagements in the United States as well as South America and Europe. Paige
lives in Lakewood, Colorado, with her husband, Tony, and daughters Hannah and Sophie.

xxviii About the Author

Business Driven MIS module 1

MOST COMPANIES TODAY rely heavily on the use of management information sys-
tems (MIS) to run various aspects of their businesses. Whether they need to order and ship
goods, interact with customers, or conduct other business functions, management information
systems are often the underlying infrastructure performing the activities. Management informa- 1 2
tion systems allow companies to remain competitive in today’s fast-paced world and especially
when conducting business on the Internet. Organizations must adapt to technological advances
and innovations to keep pace with today’s rapidly changing environment. Their competitors cer-
3
tainly will!
No matter how exciting technology is, successful companies do not use it simply for its own
sake. Companies should have a solid business reason for implementing technology. Using a MODULE 1:
technological solution just because it is available is not a good business strategy. Business Driven MIS
The purpose of Module 1 is to raise your awareness of the vast opportunities made possible
by the tight correlation between business and technology. Business strategies and processes
should always drive your technology choices. Although awareness of an emerging technology MODULE 2:
Technical Foundations
can sometimes lead us in new strategic directions, the role of information systems, for the most
of MIS
part, is to support existing business strategies and processes.

MODULE 3:
Enterprise MIS

Module 1: Business Driven MIS

CHAPTER 1: Management Information Systems: Business Driven MIS

CHAPTER 2: Decisions and Processes: Value Driven Business

CHAPTER 3: Ebusiness: Electronic Business Value

CHAPTER 4: Ethics and Information Security: MIS Business Concerns

 1
CHAPTER
Management Information
Systems: Business Driven MIS

S ECT IO N 1 .1 SE CTI ON 1. 2
Bu siness D riven M I S Bus i nes s Str ategy
CHAPTER OUTLINE

■ Competing in the Information ■ Identifying Competitive

Age Advantages
■ The Challenge of Departmental ■ The Five Forces Model—
Companies and the MIS Evaluating Industry
Solution Attractiveness
■ The Three Generic Strategies—
Choosing a Business Focus
■ Va l u e C h a i n A n a l y s i s —
Executing Business Strategies

What’s in IT for me?

This chapter sets the stage for the textbook. It starts from ground zero by providing a clear description of what information
is and how it fits into business operations, strategies, and systems. It provides an overview of how companies operate in
competitive environments and why they must continually define and redefine their business strategies to create competi-
tive advantages. Doing so allows them to survive and thrive. Information systems are key business enablers for successful
operations in competitive environments.
You, as a business student, must understand the tight correlation between business and technology. You must first rec-
ognize information’s role in daily business activities and then understand how information supports and helps implement
global business strategies and competitive advantages. After reading this chapter, you should have a solid understanding of
business driven information systems and their role in managerial decision making and problem solving.
 opening case study

The Internet of Things

Who are your best and worst customers? Who are your best and worst sales representa-
tives? How much inventory do you need to meet demand? How can you increase sales or
reduce costs? These are the questions you need to answer to run a successful business,
and answering them incorrectly can lead directly to business failure. In the past few years,
data collection and analytic technologies have been collecting massive amounts of data
that can help answer these critical business questions. The question now becomes whether
you have the right technical skills to collect and analyze your data.
Imagine your toothbrush telling you to visit your dentist because it senses a cavity. How
would you react if your refrigerator placed an order at your local grocery store because your
milk and eggs when about to expire? Over 20 years ago, a few professors at Massachusetts
Institute of Technology (MIT) began describing the Internet of Things (IoT), which is a world
where interconnected, Internet-enabled devices or “things” can collect and share data
without human intervention. Another term for the Internet of Things is machine to machine
(M2M), which allows devices to connect directly to other devices. With advanced tech-
nologies, devices are connecting in ways not previously thought possible, and researchers
predict that more than 50 billion IoT devices will be communicating by 2020. Kevin Ashton,
cofounder and executive director of the Auto-ID Center at MIT, first mentioned the Internet
of Things in a presentation he made to Procter & Gamble. Here’s Ashton’s explanation of the
Internet of Things:

Today computers—and, therefore, the Internet—are almost wholly dependent on

human beings for information. Nearly all of the roughly 50 petabytes (a petabyte is
1,024 terabytes) of data available on the Internet were first captured and created by
human beings by typing, pressing a record button, taking a digital picture, or scanning
a bar code.
The problem is, people have limited time, attention, and accuracy—all of which
means they are not very good at capturing data about things in the real world. If we
had computers that knew everything there was to know about things—using data
they gathered without any help from us—we would be able to track and count every-
thing and greatly reduce waste, loss, and cost. We would know when things needed
replacing, repairing, or recalling and whether they were fresh or past their best.

Imagine the power of a sensor sending you information on what a customer is purchas-
ing in real time from a specific location. You could easily approach the customer and offer
personal support or even a discount to ensure the sale. IoTs are generating exciting busi-
ness opportunities, as displayed in Figure 1.1.1

Business Driven MIS Module 1 3

FIGURE 1.1
THE INTERNET OF THINGS BUSINESS EXAMPLES
Car Insurance
Drive Like a Girl car insurance will install a sensor in your car that provides real-time feedback so it
can monitor your driving and offer cheaper insurance rates to safe drivers.
Smart Thermostats
IoTs share information in real-time to help homeowners manage energy more efficiently. The system
will notify the homeowner if a door is left open, change the temperature in each room when it is
occupied, and turn the furnace up or down depending on the weather and homeowner preferences.
Smart Diapers
Pixie Scientific created disposable diapers with sensors that monitor babies’ urine for signs of
infection, dehydration, or kidney problems before symptoms appear.
Smart Trash Cans
In Allentown, Pennsylvania, the city connected community trash and recycling cans, allowing them
to monitor fill rates, which were then used to recommend the most efficient routes for trash pickup
services.
Amazon’s Grocery Tool
The Amazon Fresh program released the Dash, a small voice recorder that takes notes and can
even scan a bar code so the user has a complete list of what to purchase when he or she enters the
grocery store or buys groceries online.
Smart Savings
Saving up for that new bicycle has never been easier with the Porkfolio piggy bank. This smart bank
teaches children about financial management by connecting to a mobile app that displays the child’s
current balance along with his/her financial goals.

4 Chapter 1 Management Information Systems: Business Driven MIS

section 1.1 Business Driven MIS

LEARNING OUTCOMES

1.1 Describe the information age and the differences among data, information, business intelligence,
and knowledge.
1.2 Explain systems thinking and how management information systems enable business
communications.

COMPETING IN THE INFORMATION AGE LO. 1.1: Describe the information

age and the differences among data,
Did you know that . . . information, business intelligence,
■ The movie Avatar took more than four years to create and cost $450 million? and knowledge.

■ Lady Gaga’s real name is Stefani Joanne Angelina Germanotta?

■ Customers pay $2.6 million for a 30-second advertising time slot during the Super
Bowl?2
A fact is the confirmation or validation of an event or object. In the past, people primar-
ily learned facts from books. Today, by simply pushing a button, people can find out any-
thing, from anywhere, at any time. We live in the information age, when infinite quantities
of facts are widely available to anyone who can use a computer. The impact of information
technology on the global business environment is equivalent to the printing press’s impact
on publishing and electricity’s impact on productivity. College student start-ups were mostly
unheard of before the information age. Now, it’s not at all unusual to read about a business
student starting a multimillion-dollar company from his or her dorm room. Think of Mark
Zuckerberg, who started Facebook from his dorm, or Michael Dell (Dell Computers) and Bill
Gates (Microsoft), who both founded their legendary companies as college students.
You may think only students well versed in advanced technology can compete in the infor-
mation age. This is simply not true. Many business leaders have created exceptional opportu-
nities by coupling the power of the information age with traditional business methods. Here
are just a few examples:
■ Amazon is not a technology company; its original business focus was to sell books, and it
now sells nearly everything.
■ Netflix is not a technology company; its primary business focus is to rent videos.
■ Zappos is not a technology company; its primary business focus is to sell shoes, bags,
clothing, and accessories.
Amazon’s founder, Jeff Bezos, at first saw an opportunity to change the way people pur-
chase books. Using the power of the information age to tailor offerings to each customer and
speed the payment process, he in effect opened millions of tiny virtual bookstores, each with
a vastly larger selection and far cheaper product than traditional bookstores. The success of
his original business model led him to expand Amazon to carry many other types of products.
The founders of Netflix and Zappos have done the same thing for videos and shoes. All these
entrepreneurs were business professionals, not technology experts. However, they understood
enough about the information age to apply it to a particular business, creating innovative com-
panies that now lead entire industries.
The Internet of Things (IoT) is a world where interconnected, Internet-enabled devices
or “things” can collect and share data without human intervention. Another term commonly
associated with the Internet of Things is machine to machine (M2M), which refers to devices
that connect directly to other devices. Students who understand business along with the power
associated with the information age and IoT will create their own opportunities and perhaps
even new industries. Realizing the value of obtaining real-time data from connected things
will allow you to make better-informed decisions, identify new opportunities, and analyze

Business Driven MIS Module 1 5

 APPLY YOUR KNOWLEDGE

BUSINESS DRIVEN DISCUSSION

Bill Gates, founder of Microsoft, stated that 20 years ago most people would rather
have been a B student in New York City than a genius in China because the opportu-
View from a nities available to students in developed countries were limitless. Today, many argue
that the opposite is now true due to technological advances making it easier to suc-
Flat World ceed as a genius in China than a B student in New York. As a group, discuss whether
you agree or disagree with Bill Gate’s statement.3

customer patterns to predict new behaviors. Our primary goal in this course is to arm you with
the knowledge you need to compete in the information age. The core drivers of the informa-
tion age are:
■ Data
■ Information
■ Business intelligence
■ Knowledge (see Figure 1.2)
FIGURE 1.2
Data
The Differences among
Data are raw facts that describe the characteristics of an event or object. Before the informa-
Data, Information, Business
tion age, managers manually collected and analyzed data, a time-consuming and complicated
Intelligence, and Knowledge
task without which they would have little insight into how to run their business. Lacking

Data Information Business Knowledge

Intelligence

• Raw facts that • Data converted • Information collected • The skills, experience,
describe the into a meaningful from multiple sources and expertise, coupled
characteristics and useful that analyzes patterns, with information and
of an event context trends, and relationships intelligence, that creates
or object for strategic decision a person’s intellectual
making resources.

• Order date • Best-selling • Lowest sales per week • Choosing not to fire a
• Amount sold product compared with the sales representative
• Best customer economic interest rates who is underperforming,
• Customer
• Best-selling product by knowing that person is
number • Worst-selling
month compared to experiencing family
• Quantity product
sports season and city problems
ordered • Worst
team wins and losses • Listing products that are
customer
about to expire first on
the menu or creating
them as a daily special
to move the product

6 Chapter 1 Management Information Systems: Business Driven MIS

 APPLY YOUR KNOWLEDGE

BUSINESS DRIVEN MIS

If you were watching the 2014 Winter Olympics, I bet you were excited to see your
country and its amazing athletes compete. As you were following the Olympics day
by day, you were probably checking different websites to see how your country
ranked. And depending on the website you visited, you could get a very differ-
Who Really Won
ent answer to this seemingly easy question. On the NBC and ESPN networks, the the 2014 Winter
United States ranked second, and on the official Sochie Olympic website, the United
States ranked fourth. The simple question of who won the 2014 Winter Olympics
Olympics?
changes significantly, depending on whom you asked.4
In a group, take a look at the following two charts and brainstorm the reasons
each internationally recognized source has a different listing for the top five win-
ners. What measurement is each chart using to determine the winner? Who do you
believe is the winner? As a manager, what do you need to understand when reading
or listening to business forecasts and reports?

Winter Olympics 2014 Medal Ranking According to NBC News

Rank Country Gold Silver Bronze Total
1 Russian Fed 13 11 9 33
2 United States 9 7 12 28
3 Norway 11 5 10 26
4 Canada 10 10 5 25
5 Netherlands 8 7 9 24

Winter Olympics 2014 Medal Ranking According to Official Sochie Olympic Website
Rank Country Gold Silver Bronze Total
1 Russian Fed. 13 11 9 33
2 Norway 11 5 10 26
3 Canada 10 10 5 25
4 United States 9 7 12 28
5 Netherlands 8 7 9 24

data, managers often found themselves making business decisions about how many products
to make, how much material to order, or how many employees to hire based on intuition or
gut feelings. In the information age, successful managers compile, analyze, and comprehend
massive amounts of data daily, which helps them make more successful business decisions.
Figure 1.3 shows sales data for Tony’s Wholesale Company, a fictitious business that sup-
plies snacks to stores. The data highlight characteristics such as order date, customer, sales rep-
resentative, product, quantity, and profit. The second line in Figure 1.3, for instance, shows that
Roberta Cross sold 90 boxes of Ruffles to Walmart for $1,350, resulting in a profit of $450 (note
that Profit 5 Sales 2 Costs). These data are useful for understanding individual sales; however,
they do not provide us much insight into how Tony’s business is performing as a whole. Tony
needs to answer questions that will help him manage his day-to-day operations such as:
■ Who are my best customers?
■ Who are my least-profitable customers?

Business Driven MIS Module 1 7

FIGURE 1.3
Tony’s Snack Company Data Order Sales Unit Total Unit Total
Date Customer Representative Product Qty Price Sales Cost Cost Profit
4-Jan Walmart PJ Helgoth Doritos 41 $24 $ 984 $18 $738 $246
4-Jan Walmart Roberta Cross Ruffles 90 $15 $1,350 $10 $900 $450
5-Jan Safeway Craig Schultz Ruffles 27 $15 $ 405 $10 $270 $135
6-Jan Walmart Roberta Cross Ruffles 67 $15 $1,005 $10 $670 $335
7-Jan 7-Eleven Craig Schultz Pringles 79 $12 $ 948 $ 6 $474 $474
7-Jan Walmart Roberta Cross Ruffles 52 $15 $ 780 $10 $520 $260
8-Jan Kroger Craig Schultz Ruffles 39 $15 $ 585 $10 $390 $195
9-Jan Walmart Craig Schultz Ruffles 66 $15 $ 990 $10 $660 $330
10-Jan Target Craig Schultz Ruffles 40 $15 $ 600 $10 $400 $200
11-Jan Walmart Craig Schultz Ruffles 71 $15 $1,065 $10 $710 $355

■ What is my best-selling product?

■ What is my slowest-selling product?
■ Who is my strongest sales representative?
■ Who is my weakest sales representative?
What Tony needs, in other words, is not data but information.

Information
Information is data converted into a meaningful and useful context. Having the right infor-
mation at the right moment in time can be worth a fortune. Having the wrong information
at the right moment, or the right information at the wrong moment, can be disastrous. The
truth about information is that its value is only as good as the people who use it. People
using the same information can make different decisions depending on how they interpret
or analyze the information. Thus information has value only insofar as the people using it
do as well.
Tony can analyze his sales data and turn them into information to answer all the preced-
ing questions and understand how his business is operating. Figures 1.4 and 1.5, for instance,
show us that Walmart is Roberta Cross’s best customer and that Ruffles is Tony’s best product
measured in terms of total sales. Armed with this information, Tony can identify and then
address such issues as weak products and underperforming sales representatives.
A variable is a data characteristic that stands for a value that changes or varies over time.
For example, in Tony’s data, price and quantity ordered can vary. Changing variables allows
managers to create hypothetical scenarios to study future possibilities. Tony may find it valu-
able to anticipate how sales or cost increases affect profitability. To estimate how a 20 per-
cent increase in prices might improve profits, Tony simply changes the price variable for all
orders, which automatically calculates the amount of new profits. To estimate how a 10 percent
increase in costs hurts profits, Tony changes the cost variable for all orders, which automati-
cally calculates the amount of lost profits. Manipulating variables is an important tool for any
business.

Business Intelligence
Business intelligence (BI) is information collected from multiple sources such as suppliers,
customers, competitors, partners, and industries that analyzes patterns, trends, and relation-
ships for strategic decision making. BI manipulates multiple variables and in some cases even
hundreds of variables, including such items as interest rates, weather conditions, and even gas
prices. Tony could use BI to analyze internal data, such as company sales, along with exter-
nal data about the environment such as competitors, finances, weather, holidays, and even

8 Chapter 1 Management Information Systems: Business Driven MIS

 Order Sales Unit Total Total
Date Customer Representative Product Quantity Price Sales Unit Cost Cost Profit
26-Apr Walmart Roberta Cross Fritos 86 $ 19 $ 1,634 $ 17 $ 1,462 $ 172
29-Aug Walmart Roberta Cross Fritos 76 $ 19 $ 1,444 $ 17 $ 1,292 $ 152
7-Sep Walmart Roberta Cross Fritos 20 $ 19 $ 380 $ 17 $ 340 $ 40
22-Nov Walmart Roberta Cross Fritos 39 $ 19 $ 741 $ 17 $ 663 $ 78
30-Dec Walmart Roberta Cross Fritos 68 $ 19 $ 1,292 $ 17 $ 1,156 $ 136
7-Jul Walmart Roberta Cross Pringles 79 $ 18 $ 1,422 $ 8 $ 632 $ 790
6-Aug Walmart Roberta Cross Pringles 21 $ 12 $ 252 $ 6 $ 126 $ 126
2-Oct Walmart Roberta Cross Pringles 60 $ 18 $ 1,080 $ 8 $ 480 $ 600
15-Nov Walmart Roberta Cross Pringles 32 $ 12 $ 384 $ 6 $ 192 $ 192
21-Dec Walmart Roberta Cross Pringles 92 $ 12 $ 1,104 $ 6 $ 552 $ 552
28-Feb Walmart Roberta Cross Ruffles 67 $ 15 $ 1,005 $ 10 $ 670 $ 335
6-Mar Walmart Roberta Cross Ruffles 8 $ 15 $ 120 $ 10 $ 80 $ 40
16-Mar Walmart Roberta Cross Ruffles 68 $ 15 $ 1,020 $ 10 $ 680 $ 340
23-Apr Walmart Roberta Cross Ruffles 34 $ 15 $ 510 $ 10 $ 340 $ 170
4-Aug Walmart Roberta Cross Ruffles 40 $ 15 $ 600 $ 10 $ 400 $ 200
18-Aug Walmart Roberta Cross Ruffles 93 $ 15 $ 1,395 $ 10 $ 930 $ 465
5-Sep Walmart Roberta Cross Ruffles 41 $ 15 $ 615 $ 10 $ 410 $ 205
12-Sep Walmart Roberta Cross Ruffles 8 $ 15 $ 120 $ 10 $ 80 $ 40
28-Oct Walmart Roberta Cross Ruffles 50 $ 15 $ 750 $ 10 $ 500 $ 250
21-Nov Walmart Roberta Cross Ruffles 79 $ 15 $ 1,185 $ 10 $ 790 $ 395
29-Jan Walmart Roberta Cross Sun Chips 5 $ 22 $ 110 $ 18 $ 90 $ 20
12-Apr Walmart Roberta Cross Sun Chips 85 $ 22 $ 1,870 $ 18 $ 1,530 $ 340
16-Jun Walmart Roberta Cross Sun Chips 55 $ 22 $ 1,210 $ 18 $ 990 $ 220
1,206 $383 $20,243 $273 $14,385 $5,858
Sorting the data reveals the information that Roberta Cross’s total sales to Walmart were $20,243 resulting in a profit of $5,858.
(Profit $5,858 5 Sales $20,243 2 Costs $14,385).

FIGURE 1.4

sporting events. Both internal and external variables affect snack sales, and analyzing these Tony’s Data Sorted by
variables will help Tony determine ordering levels and sales forecasts. For instance, BI can Customer “Walmart” and Sales
predict inventory requirements for Tony’s business for the week before the Super Bowl if, say, Representative “Roberta Cross”
the home team is playing, average temperature is above 80 degrees, and the stock market is
performing well. This is BI at its finest, incorporating all types of internal and external vari-
ables to anticipate business performance.
A big part of business intelligence is an area called predictive analytics, which extracts
information from data and uses it to predict future trends and identify behavioral patterns.
Top managers use predictive analytics to define the future of the business, analyzing mar-
kets, industries, and economies to determine the strategic direction the company must follow
to remain profitable. Tony will set the strategic direction for his firm, which might include
introducing new flavors of potato chips or sports drinks as new product lines or schools and
hospitals as new market segments.

Knowledge
Knowledge includes the skills, experience, and expertise, coupled with information and intel-
ligence, that create a person’s intellectual resources. Knowledge workers are individuals val-
ued for their ability to interpret and analyze information. Today’s workers are commonly
referred to as knowledge workers and they use BI along with personal experience to make
decisions based on both information and intuition, a valuable resource for any company.

Business Driven MIS Module 1 9

 APPLY YOUR KNOWLEDGE

BUSINESS DRIVEN ETHICS AND SECURITY

IoT is transforming our world into a living information system as we control our
intelligent lighting from our smart phone to a daily health check from our smart toilet.
The Internet of Of course, with all great technological advances come unexpected risks, and you
have to be prepared to encounter various security issues with IoT. Just imagine if
Things Is Wide your devices are hacked by someone who now can shut off your water, take control
of your car, or unlock the doors of your home from thousands of miles away. We are
Open—For just beginning to understand the security issues associated with IoT and M2M, and
Everyone! you can be sure that sensitive data leakage from your IoT device is something you
will most likely encounter in your life.5 (For more information about IoT, refer to
the Opening Case Study.)
In a group, identify a few IoT devices you are using today. These can include fit-
ness trackers that report to your iPhone, sports equipment that provides immediate
feedback to an app, or even smart vacuum cleaners. If you are not using any IoT
devices today, brainstorm a few you might purchase in the future. How could a crim-
inal or hacker use your IoT to steal your sensitive data? What potential problems or
issues could you experience from these types of illegal data thefts? What might be
some of the signs that someone had accessed your IoT data illegally? What could
you do to protect the data in your device?

Imagine that Tony analyzes his data and finds his weakest sales representative for this
period is Craig Schultz. If Tony considered only this information, he might conclude that fir-
ing Craig was a good business decision. However, because Tony has knowledge about how the
company operates, he knows Craig has been out on medical leave for several weeks; hence,
his sales numbers are low. Without this additional knowledge, Tony might have executed a
bad business decision, delivered a negative message to the other employees, and sent his best
sales representatives out to look for other jobs.
The key point in this scenario is that it is simply impossible to collect all the information
about every situation, and yet without that, it can be easy to misunderstand the problem.

FIGURE 1.5
Information Gained after Tony’s Business Information Name Total Profit
Analyzing Tony’s Data Who is Tony’s best customer by total sales? Walmart $ 560,789
Who is Tony’s least-valuable customer by total sales? Walgreens $ 45,673
Who is Tony’s best customer by profit? 7-Eleven $ 324,550
Who is Tony’s least-valuable customer by profit? King Soopers $ 23,908
What is Tony’s best-selling product by total sales? Ruffles $ 232,500
What is Tony’s weakest-selling product by total sales? Pringles $ 54,890
What is Tony’s best-selling product by profit? Tostitos $ 13,050
What is Tony’s weakest-selling product by profit? Pringles $ 23,000
Who is Tony’s best sales representative by profit? R. Cross $1,230,980
Who is Tony’s weakest sales representative by profit? Craig Schultz $ 98,980
What is the best sales representative’s best-selling product by total profit? Ruffles $ 98,780
Who is the best sales representative’s best customer by total profit? Walmart $ 345,900
What is the best sales representative’s weakest-selling product by
total profit? Sun Chips $ 45,600
Who is the best sales representative’s weakest customer by total profit? Krogers $ 56,050

10 Chapter 1 Management Information Systems: Business Driven MIS

Using data, information, business intelligence, and knowledge to make decisions and solve
problems is the key to finding success in business. These core drivers of the information age
are the building blocks of business systems.

THE CHALLENGE OF DEPARTMENTAL COMPANIES LO 1.2: Explain systems thinking

AND THE MIS SOLUTION and how management information
systems enable business
Companies are typically organized by department or functional area such as: communications.

■ Accounting: Records, measures, and reports monetary transactions.

■ Finance: Deals with strategic financial issues, including money, banking, credit, invest-
ments, and assets.
■ Human resources: Maintains policies, plans, and procedures for the effective manage-
ment of employees.
■ Marketing: Supports sales by planning, pricing, and promoting goods or services.
■ Operations management: Manages the process of converting or transforming resources
into goods or services.
■ Sales: Performs the function of selling goods or services (see Figure 1.6).
FIGURE 1.6
Each department performs its own activities. Sales and marketing focus on moving goods or
services into the hands of consumers; they maintain transactional data. Finance and account- Departments Working
ing focus on managing the company’s resources and maintain monetary data. Operations Independently

Accounting
Records, measures, and
reports monetary
transactions.

Finance
Sales Tracks strategic financial
Performs the function of issues, including money,
selling goods or services. banking, credit,
investments, and assets.

Operations
management Human resources
Manages the process of Maintains policies, plans,
converting or transforming and procedures for the
resources into goods or effective management of
services. employees.
Marketing
Supports sales by
planning, pricing, and
promoting goods or
services.

Business Driven MIS Module 1 11

 Accounting
• Transactional data
• Purchasing data
• Payroll data
• Tax data
Sales
Finance
• Potential customer data
• Investment data
• Sales report data
• Monetary data
• Commission data
• Reporting data
• Customer support data

Business Decisions

Operations management Human resources

• Manufacturing data • Employee data
• Distribution data • Promotion data
• Production data • Vacation data
Marketing
• Promotion data
• Sales data
• Advertising data

FIGURE 1.7
Departments Working Together
management focuses on manufacturing and maintains production data; human resources
focuses on hiring and training people and maintains employee data. Although each depart-
ment has its own focus and data, none can work independently if the company is to operate
as a whole. It is easy to see how a business decision one department makes can affect other
departments. Marketing needs to analyze production and sales data to come up with product
promotions and advertising strategies. Production needs to understand sales forecasts to deter-
mine the company’s manufacturing needs. Sales needs to rely on information from operations
to understand inventory, place orders, and forecast consumer demand. All departments need to
understand the accounting and finance departments’ information for budgeting. For the firm to
be successful, all departments must work together as a single unit sharing common informa-
tion and not operate independently or in a silo (see Figure 1.7).

The MIS Solution

You probably recall the old story of three blind men attempting to describe an elephant. The
first man, feeling the elephant’s girth, said the elephant seemed very much like a wall. The
second, feeling the elephant’s trunk, declared the elephant was like a snake. The third man felt
the elephant’s tusks and said the elephant was like a tree or a cane. Companies that operate
departmentally are seeing only one part of the elephant, a critical mistake that hinders suc-
cessful operation.
Successful companies operate cross-functionally, integrating the operations of all depart-
ments. Systems are the primary enabler of cross-functional operations. A system is a collec-
tion of parts that link to achieve a common purpose. A car is a good example of a system,
since removing a part, such as the steering wheel or accelerator, causes the entire system to
stop working.
Before jumping into how systems work, it is important to have a solid understanding of the
basic production process for goods and services. Goods are material items or products that

12 Chapter 1 Management Information Systems: Business Driven MIS

 FIGURE 1.8
Different Types of Goods
and Services
GOODS SERVICES
Material items or products Tasks people perform
that customers will buy to that customers will buy
satisfy a want or need. to satisfy a want or need.

Cars Teaching

Waiting
Groceries
tables

Clothing Cutting hair

customers will buy to satisfy a want or need. Clothing, groceries, cell phones, and cars are
all examples of goods that people buy to fulfill their needs. Services are tasks people perform
that customers will buy to satisfy a want or need. Waiting tables, teaching, and cutting hair are
all examples of services that people pay for to fulfill their needs (see Figure 1.8).
Production is the process by which a business processes raw materials or converts them
into a finished product for its goods or services. Just think about making a hamburger (see
Figure 1.9). First, you must gather all of the inputs or raw materials such as the bun, patty,
lettuce, tomato, and ketchup. Second, you process the raw materials, so in this example you
would need to cook the patty, wash and chop the lettuce and tomato, and place all of the
items in the bun. Finally, you would have your output or finished product—your hamburger!
Productivity is the rate at which goods and services are produced based on total output given
total inputs. Given our previous example, if a business could produce the same hamburger
with less-expensive inputs or more hamburgers with the same inputs, it would see a rise in

FIGURE 1.9
Input, Process, Output Example
Input Process Output

Lettuce, Cook the patty, put

tomatoes, patty, the ingredients Hamburger
bun, ketchup together

Business Driven MIS Module 1 13

FIGURE 1.10
Overview of Systems Thinking

Output
Input Process
• The resulting
• Data that is • Computer program information from
entered in a that processes the the computer
computer data program

Feedback
• Controls to ensure
correct processing

productivity and possibly an increase in profits. Ensuring the input, process, and output of
goods and services work across all of the departments of a company is where systems add
tremendous value to overall business productivity.

Systems Thinking
Systems thinking is a way of monitoring the entire system by viewing multiple inputs being
processed or transformed to produce outputs while continuously gathering feedback on each
part (see Figure 1.10). Feedback is information that returns to its original transmitter (input,
transform, or output) and modifies the transmitter’s actions. Feedback helps the system main-
tain stability. For example, a car’s system continuously monitors the fuel level and turns on a
warning light if the gas level is too low. Systems thinking provides an end-to-end view of how
operations work together to create a product or service. Business students who understand
systems thinking are valuable resources because they can implement solutions that consider
the entire process, not just a single component.
Management information systems (MIS) is a business function, like accounting and
human resources, which moves information about people, products, and processes across the
company to facilitate decision making and problem solving. MIS incorporates systems think-
ing to help companies operate cross-functionally. For example, to fulfill product orders, an
MIS for sales moves a single customer order across all functional areas, including sales, order
fulfillment, shipping, billing, and finally customer service. Although different functional
areas handle different parts of the sale, thanks to MIS, to the customer the sale is one continu-
ous process. If one part of the company is experiencing problems, however, then, like the car
without a steering wheel, the entire system fails. If order fulfillment packages the wrong prod-
uct, it will not matter that shipping, billing, and customer service did their jobs right, since the
customer will not be satisfied when he or she opens the package.
MIS can be an important enabler of business success and innovation. This is not to say
that MIS equals business success and innovation, or that MIS represents business success and
innovation. MIS is a tool that is most valuable when it leverages the talents of people who
know how to use and manage it effectively. To perform the MIS function effectively, almost
all companies, particularly large and medium-sized ones, have an internal MIS department,
often called information technology (IT), information systems (IS), or management informa-
tion systems (MIS). For the purpose of this text, we will refer to it as MIS.

MIS Department Roles and Responsibilities

MIS as a department is a relatively new functional area, having been around formally for
about 40 years. Job titles, roles, and responsibilities often differ from company to company,
but the most common are displayed in Figure 1.11. Although many companies may not have a
different individual for each of these positions, they must have top managers who take respon-
sibility for all these areas.

14 Chapter 1 Management Information Systems: Business Driven MIS

 Chief security officer (CSO)
Responsible for ensuring the security
of business systems and developing
strategies and safeguards against
attacks by hackers and viruses.

Chief knowledge officer (CKO)

Responsible for collecting,
maintaining, and distributing Chief technology officer (CTO)
company knowledge. Responsible for ensuring the
speed, accuracy, availability,
and reliability of the MIS.

MIS Department Roles

and Responsibilities

Chief information officer (CIO)

Chief privacy officer (CPO)
Responsible for (1) overseeing all uses of
MIS and (2) ensuring that MIS strategically Responsible for ensuring the ethical
aligns with business goals and objectives. and legal use of information within a
company.

FIGURE 1.11
The Roles and Responsibilities
of MIS

section 1.2 Business Strategy

LEARNING OUTCOMES

1.3 Explain why competitive advantages are temporary.

1.4 Identify the four key areas of a SWOT analysis.
1.5 Describe Porter’s Five Forces Model and explain each of the five forces.
1.6 Compare Porter’s three generic strategies.
1.7 Demonstrate how a company can add value by using Porter’s value chain analysis.

IDENTIFYING COMPETITIVE ADVANTAGES LO 1.3: Explain why competitive

advantages are temporary.
Running a company today is similar to leading an army; the top manager or leader ensures
all participants are heading in the right direction and completing their goals and objectives.
Companies lacking leadership quickly implode as employees head in different directions
attempting to achieve conflicting goals. To combat these challenges, leaders communi-
cate and execute business strategies (from the Greek word stratus for army and ago for
leading).

Business Driven MIS Module 1 15

 A business strategy is a leadership plan that achieves a specific set of goals or objectives
such as increasing sales, decreasing costs, entering new markets, or developing new products
or services. A stakeholder is a person or group that has an interest or concern in an organiza-
tion. Stakeholders drive business strategies, and depending on the stakeholder’s perspective,
the business strategy can change. It is not uncommon to find stakeholders’ business strate-
gies have conflicting interests such as investors looking to increase profits by eliminating
employee jobs. Figure 1.12 displays the different stakeholders found in an organization and
their common business interests.
Good leaders also anticipate unexpected misfortunes, from strikes and economic reces-
sions to natural disasters. Their business strategies build in buffers or slack, allowing the com-
pany the ability to ride out any storm and defend against competitive or environmental threats.
Of course, updating business strategies is a continuous undertaking as internal and external
environments rapidly change. Business strategies that match core company competencies to
opportunities result in competitive advantages, a key to success!
A competitive advantage is a feature of a product or service on which customers place
a greater value than they do on similar offerings from competitors. Competitive advantages
provide the same product or service either at a lower price or with additional value that can
fetch premium prices. Unfortunately, competitive advantages are typically temporary because
competitors often quickly seek ways to duplicate them. In turn, organizations must develop a

FIGURE 1.12
Stakeholders’ Interests

PARTNERS/
SUPPLIERS
Reliable Contracts
Ethical Materials
Handling
GOVERNMENT Responsible
SHAREHOLDERS/
Adhere to Production
INVESTORS
Regulations/Laws
Maximize Profits
Increase
Grow Market
Employment
Share
Ethical Taxation
High Return on
Reporting
Investment

ORGANIZATION

CUSTOMERS COMMUNITY
Exceptional Professional
Customer Service Associations
High-Quality Ethical Recycling
Products Increase
Ethical Dealing Employment
EMPLOYEES
Fair Compensation
Job Security
Ethical Conduct/
Treatment

16 Chapter 1 Management Information Systems: Business Driven MIS

Another random document with
no related content on Scribd:
the Companies disposing, who are to fynde them dyett during that
time, and tenne pounds more to Mr Higgeson towards his present
fitting him and his for the voyage.
Francis Higgison.
Samuel Skelton.
A TRUE RELATION OF THE
LAST VOYAGE TO
NEW ENGLAND
 A trve relacon of ye last voyage to new
England, declaring all circustances wth ye
maner of ye passage wee had by sea, and
what maner of countrey & inhabitants we
found when we came to land: & what is ye
present state & condicon of ye English
people yt are there already.

Faithfully recorded according to ye very truth for ye satisfaction of

very many of my loving friends, who haue earnestly requested
to be truly certifyed in these thinges.
Written from new England July 24, 1629.

It. any Curious Criticke yt lookes for exactnes of phrases or expert

seaman yt regard propriety of sea-termes &c
 A TRVE RELACON of ye last voyage to
new England made ye last Sumer, begun ye 25th
of April being Saturday, Anno doi 1629.

THE copany of New England consisting of many worthy gentlemen in ye

citty of London, Dorcester & other places, ayming at ye glory of God, ye
propagacon of ye gospell of Christ, ye conversio of ye Indians, & ye enlargemt
of ye Kings maties dominions in America, & being authorised by his royall
letters patents for yt end, at their very great costs & chardgs furnished 5
Ships to go to new England, for ye further setling of ye English plantacon yt
yy had already begun there.
The names of ye 5 Shipps were as followeth. The first is called ye Talbot,
a good & strong shipp of 300 tunnes, & 19 pieces of ordinance & served wth
30 mariners. This ship carried about an 100 planters, 6 goates, 5 great
pieces of ordinaunce, wth meale, oatemeale pease, & all maner of munitio
and provisio for ye plantacon for a twelve month. The second ye George,
another strong ship also, about 300 tunnes, 20 pieces of ordinance, served
wth about 30 mariners; her chiefe carriage were cattell, 12 mares, 30 kyne,
& some goates: also ther gad in her 52 planters & other provision. The 3d is
called ye Lyons whelpe, a neate & nimble ship of 120 tunnes, 8 pieces of
ordinaunce, carrying in her many mariners & about 40 planters, specially
fro dorcester & other places thereabouts, wth provision, and 4 goates.
The 4th is called ye 4 sisters, as I heare of about 300 tuns, wch fayre ship
carried many cattell wth passengers & provision.
The 5th is called ye Mayflower, carrying passengers & provision.
Now amongst these 5 ships, ye George hauing the speciall & urgent
cause of hastening her passage sett sayle before ye rest about ye midst of
April. And ye 4 Sisters & ye Mayflower being not throughly furnished,
intended as we heard to sett forth about 3 weeks after vs: But we yt were in
ye Talbot & ye Lions whelpe being ready for or voyage by ye good hand of
Gods providence hoysed or sayle fro Graues end on Saturday ye 25th of
April about 7 a clocke in ye morning. Having but a faynt wynd
[April 25] we could not go farre ytday, but at night wee ancred against
Lie wch is 12 miles fro graues end, & there we rested yt night & kept
[26] Sabbath ye next day.
On monday we sat forward & came to ye flats, a passage soewhat
[27] difficult by reason of ye narrownes of ye channell & shallownes of ye
water: & going ouer this wee were in soe daunger: for or ship being heavy
laden & drawing deepe water was sensibly felt of vs all to strike 3 or 4
tymes on ye ground: but ye wynd blowing soewhat strong we were carried
Swiftly on, & at last by Gods blessing came safe to ancre at Gorin roade.
Tewsday we went a little further, & ancred ouer agt Margret
[28] Towne, staying for a wind for ye downes.
Wednesday we came safely though wth much turning & tacking
[29] thorow ye gullies into ye downes, & stayed yt night.
Thursday, Fryday & Saturday ye wind blew hard fro
[30. May 1. 2.] south west & caused or ship to daunce, & diuers of or
passengers & my wiffe specially were sea sicke. Here ye Kings ship called
ye Assurance pressed 2 of or mariners. Here we saw many Porpuses
playing in ye sea wch yy say is a signe of fowle weather.
Sabbath day a windye day & could: we kept Sabbath staying
[May 3] still at ye downes.
Monday God sent vs a fayre gale of wind north: n: East, whereby
[4] we came merily fro ye downes: & passing Dover we saw 6 or 7 saile
of dunkirkes, wafting after vs: but it seemed yy saw or copany was too
strong for ym, for then wee had wth vs 3 or 4 ships yt went for ye Straits: so
yy returned backe fro pursuing vs any longer. But sayling wth a good wind
wee went speedily, & at night came neere ye Ile of Wight but being darke
wee durst not put into ye channell, but put backe for sea roome 4 houres, &
then other 4 houres sayled backe agayne ye same way.
Tewsday early in ye morning we entred ye channell ye wind being
[5] weake & calme, & passed by Portsmouth very slowly; but in ye
afternoone ye wind quickened, & wee were forced to ancre a little on this
side Cowcastle but ye wind growing more favourable wee weighed & came
to ancre again right against Cowcastle thinking to stay yt night, ye wind
 being very calme. Here I & my wiffe & my daughter Mary & 2
[May] maids & soe others wth vs obtained of ye mr of ye shipp to go a
shoare to refresh vs & to wash or linnens, & so we lay at Cowes yt night.
But ye wind turning when wee were absent, yy hoysed sayle & left vs there,
& ancred 8 miles further ouer agt Yarmouth about 8 of ye clocke at night.
Wednesday betyme in ye morning ye shalope was sent fro ye shipp
[6] to fetch vs to Yarmouth; but ye water prooued rough & or weomen
desired to bee sett on shoare 3 miles short of Yarmouth, & so went on foote
by land & lodged in Yarmouth yt night.
On Thursday & fryday there Mr Beecher allowed by ye copany
[7. 8.] gaue mee 40s to make or provisio of what things we would for the
voyage.
Saturday we went to board agayne: & this day wee had 2 other
[9] men pressed to serve ye Kings Shippe; but we got one agayne by
intreaty.
The Sabbath next day we kept ye shipp where I preached in ye
[10.] morning; & in ye afternoon was intreated to preach at Yarmouth,
where Mr Meare & captayne Borley entertained vs very kyndly, & earnestly
desyred to bee certified of or safe arrivall in new England, & of ye state of ye
countrey
Monday morning blew a fayre wind fro East S: E: And ye lions
[11] whelpe having taken in all her provisio for passengers, about 3 of ye
clocke in ye afternoone wee hoysed sayle for ye Needles, & by Gods
guidance safely passed yt narrow passage a little after 4 a clocke in ye
afternoone. And being entred into ye sea, fro ye top of ye mast we discerned
4 sayle of shipps lying southward fro vs. But night coming on wee tooke in
or long boate & shalope. And ye next day we had a fayre gale of
[12] Easterly wind yt brought vs towards night as farre as ye Lizzard.
Wednesday ye wind still houlding Easterly, wee came as farre as
[13] ye lands end, in ye vtmost part of Cornewall, & so left or deare natiue
soile of England behind vs; & sayling about 10 leagues further we passed
ye Isles of Sillie & launched ye same day a great way into ye maine ocean.
And now my wiffe & other passengers began to feele ye tossing waues of ye
westerne sea, & so were very sea-sicke.
And this is to be noted, yt all this while or passage hath bene vpo ye coast
of England, & so ought truly to be accounted ye first day of or parting wth
ould England.
 Thursday ye same Easterly wind blew all day & night; & ye next
[14] day; so yt soe of ye seamen thought we were coe by this
tyme 100 leagues fro England, but toward night ye wind was
[15] [May] calme.
Saturday we were becalmed all day. This day met vs a little shipp
[16] of Bristoll yt came fro Christopher Ilands.
Sabath being ye first Lords day we held at sea was very calme,
[17.] especially in the morning, but we were disturbed in or morning
Service by ye approach of a Biskaniers shippe, a man of warre, yt made
towards vs, & manned out his boate to viewe vs: But fynding vs too strong
for him he durst not venture to assault vs, but made off.
This day my 2 children Samuel & Mary began to be sicke of ye small-
pockes & purples together, wch was brought into ye ship by one Mr Browne
wch was sicke of ye same at Graues End, who it pleased God to make ye
first occasio of bringing yt contagious sicknes among vs, wherewth many
were after afflicted.
Monday calme still, ye wind being no: w: blowing a little towards
[18.] euening, but contrary to or course.
Tewsday wind so: w: as little helpfull as ye former & blowing uery
[19.] weake. This day ye mr of or ship, my selfe & another went aboard
the Lions whelpe, where Mr Gibs made vs welcoe wth bountifull
entertaynemt. And this day towards night my daughter grew sicker & many
blew Spots were seene vpo her breast, wch affrighted vs. At ye first wee
thought yy had bene ye plague tokens; but we found afterwards yt it was
onely an high measure of ye infectio of ye pockes, wch were strucke agayne
into ye child, & so it was Gods will ye child dyed about 5 of ye clocke at
night, being ye first in or shipp yt was buried in the bowells of ye great
Atlanticke Sea; wch as it was a griefe to vs her parents, & a sorrow to all ye
rest as being ye beginning of a contagious disease & mortality: so in ye
same judgemt it pleased God to remember mercy in ye child, in freeing it fro
a world of misery wherein otherwise shee had liued all her daies. For being
about 4 yeares ould a yeare since, wee know not by what meanes, sweyed
in ye backe, so yt it was broken & grew crooked, & ye joynts of her hipps
were loosed & her knees went crooked pittifull to see. Since wch tyme shee
hath had a most lamentable payne in her belly, & would oft times cry out in
ye day & in her sleep also my belly, wch declared soe extraordinary
distemper. So yt in respect of her wee had cause to take her death as a
blessing fro ye Lord to shorten her miserie.
 Wednesday a wett morning, ye wind was W: S: W: & in ye
[May 20] afternoone N: W: & by W: both being contrary to or course,
wch was to saile W: & by S: Thus it pleased god to lay his hand vpo vs by
sicknes & death & contrary winds; & stirred vp soe of vs to make ye moton
of humbling or selves vnder ye hand of God by keeping a solemne day of
fasting & prayer unto God, to beseech him to remooue ye continuance &
further increase of these evills fro vs. wch was willingly condescended vnto
as a duty very fitting & needfull for or present state and condicon.
Thursday, there being 2 ministers in ye ship, Mr Smith & my selfe,
[21] we endevoured together wth others to consecrate ye day as a
solemne fasting & humiliacon to almighty God, as a furtheraunce of or
present worke. And it pleased God ye ship was becalmed all day, so yt we
were freed fro any encumbraunce: And as soone as we had done prayers,
see & behould ye goodnes of god, about 7 a clocke at night ye wind turned
to n: e: & we had a fayre gale yt night as a manifest evidence of ye Lords
hearing or prayers. I heard soe of ye mariners say, yy thought this was ye
first sea-fast yt euer was kept, & yt yy neuer heard of ye like perfourmed at
sea before.
Fryday ye wind fayre, & east northerly, & for or purpose for new
[22.] England. it did blow strongly & carried vs on amayne wth tossing
waues, wch did affright ym yt were not wonted to such sights.
[May]
Saturday ye same wind blowing but more gently. Now we were
[23.] coforted wth hope of my sonne Samuels recovery of ye pockes.
The 2 Lords day, a fayre day, an orderly wind & prosperous.
[24.]
On Monday a fayre frummegale, ye wind South S: W:
[25] Tewsday about 10 of ye clocke in ye morning, whilest we were at
prayers a strong and sudden blast came fro ye north, yt hoysed vp
[26.] ye waues & tossed vs more then euer before & held vs all yt day till
towards night & then abated by little & little till it was calme. This
day Mr Goffes great dogg fell ouer board & could not be recouered.
Wednesday, ye wind still no: & calme in ye morning, but about
[27.] noone there arose a So: wind, wch encreased more & more, so yt it
seemed to vs yt are land men a sore & terrible storme; for ye wind blew
mightily, ye rayne fell vehemently, ye sea roared & ye waues tossed vs
horribly; besides it was fearfull darke & ye mariners maid was afraid; &
noyse on the other side wth their running here & there, lowd crying one to
another to pull at this & yt rope. The waues powred ymselues
[May 27]
 ouer ye shippe yt ye 2 boates were filled wth water, yt yy were
fayne to strike holes in ye midst of ym to let ye water out. Yea by ye violence
of ye waues ye long boate coard wch held it was broken, & it had like to haue
bene washed ouerboard, had not ye mariners wth much payne & daunger
recouered ye same. But this lasted not many houres; after which it became
a calmish day. All wch while I lay close & warme in my cabine, but farre fro
hauing list to sleepe wth Jonah; my thoughts were otherwise employed as
ye tyme & place required. Then I saw ye truth of ye Scripture Psal. 107, fro
ye 23 to ye 32. And my feare at this tyme was ye lesse, when I rememberd
what a loving friend of myne, a minister accustomed to sea stormes said to
mee yt I might not be dismayed at such stormes, for yy were ordinary at
seas, & it seeldome falls out yt a shipp perisheth at storms if it haue sea-
roome, wch I ye rather wryte yt others as well as my selfe by ye knowledge
hereof may be encouraged & prepared agt these ordinary sea-stormes.
Thursday So: wind: calme at night: On fryday a boistrous
[28 29] wind blowing crosse, but was allayed towards night wth a
showre of rayne. Saturday So: w: wind, but faire & quiett.
[30]
Sabbath day being ye 3 Lords day, fayre & calme; wee saw
[May 31] abundance of grampas fishes, 2 or 3 yards long, & a body as
bigg as an oxe.
Monday ye wind westerly & calme: but besides or being
[June 1] stayed by contrary winds we began to fynd ye temperature of
ye ayre to alter & to become more soletry & subject to vnwholsome foggs.
For coming now to ye height of ye westerne Islands, soe of or men fell sicke
of ye scuruie & others of the small pockes, wch more & more increased: yet
thankes be to God none dyed of it but my owne child mencond. And
therefore, according to or great need we appointed another fast for the next
day.
Tewsday we solemnely celebrate another fast. The Lord yt day
[2.] heard vs before wee prayed & gaue vs aunswere before we called;
for early in ye morning ye wind turned full East, being as fitt a wind as could
blowe. And sitting at my study on ye shipps poope I saw many bonny fishes
& porpuses pursuing one another, and leaping soe of ym a yard aboue ye
water. Also as we were at prayer, vnder ye hatch, soe yt were aboue saw a
whale puffing vp water not farre fro ye shippe. Now my wiffe was prettily
well recouered of her sea sicknesse.
Wednesday a fayre day & fyne gale of full East wind. This day my
[3.] selfe & others saw a large round fish sayling by ye ships side about a
 yard in length & roundnes euery way. The mariners cald it a
[June] sunne fish; it spreadeth out ye finnes like beames on euery side
4, or 5.
Thursday & fryday ye wind full E: we were carried wth
[4, 5.] admiracon on or journey. By this wee were more then halfe way
to new England. This day I saw a fish very straunge to mee, yy call it a
caruell; wch came by ye ship side wafting along ye top of ye water. it
appeared at ye first like a bubble aboue the water as bigg as a mans fist,
but ye fish it selfe is about ye bignes of a mans thum, so yt ye fish it selfe &
ye bubble resembleth a shipp wth sailes, wch therefore is called a caruell.
Saturday wind direct E: still. The 4 Sabb: we kept at sea the wind
[6 7] full full Easterly till noone, & then it came full So: E: a strong gale yt
night & ye next day till night.
[8]
Tewsday ye same wind held till 9 a clock in ye morning: & then a
[9] great showre wch lasted till about 7 at night, & then it was a very
calme. There we sounded wth a dipled lyne aboue 100th fadome &
found no bottome. This day we saw a fish called a turkle, a great & large
shell fish swiming aboue ye water neere ye shippe.
Wednesday wind northerly a fyne gale but calmish in ye
[10] afternoone.
Thursday ye wind at no: an easye gale & fayre morning we
[11 June] saw a mountayne of Ice shyning as white as snow like to a
great rocke or clift on ye shoare. it stood still & therefore we thought it to be
on ground & to reach ye bottome of ye sea. For though there came a mighty
streame fro ye no: yet it mooued not, wch made vs sound, & we found a
banke of 40 fathom deepe whereupo we judged it to rest: & ye height aboue
was as much. Wee also saw 6 or 7 pieces of Ice, floating on ye sea, wch
was broken off fro ye former mountayne, we also saw great store of water
fowle swiming by ye shipp wthin musket shott, of a pyde colour & about ye
bignes of a wild ducke, about 40 in a copany, the mariners call ym hag
birds. Toward night came a fogge, yt ye lions whelp was lost till morning.
And now we saw many bony toes porpuses and grampases every day
more & more.
Fryday foggie & calmish, ye wind northerly in ye morning, but
[12] about noone it came S: E: a dainty loome gale wch carried vs 6
leagues a watch.

[13]
 Saturday ye same wind till night, & we saw great store of
porpuses & grampases.
The 5th Sabbath, ye same wind, towards noone it began to be
[14] foggie, & then it rained till night we went 4 or 5 leagues a watch.
Monday a fayre day but foggie, ye same wind blowing but
[June 15] wth fresh gale carryed vs 7 leagues a watch. In ye afternoone
it blew harder, so ye sea was rough, & we lost ye sight of ye lions whelpe: it
being foggie we drumed for ym & yy shot off a great piece of ordinance but
we feared not one another.
Tewsday wind So: & by E: foggie till about 10 a clocke while we
[16] were at prayers it cleared vp about an houre, & then we saw ye lions
whelpe distant about 2 leagues southward. wee presently tackt about to
meet her & shee did ye same to meete vs, but before we could get together
a thick fogge came, yt we were long in fynding each other. This day we
sounded divers tymes, & found orselves on another banke, at first 40
fathom, after 36. after 33. after 24. wee thought it to haue bene ye banke
ouer agt chap Sable, but we were deceiued, for we knew not certainly
where we were because of ye fogge. After 3 or 4 houres copany we lost ye
lions whelpe agayne: & beate or drume & shot off a great piece of
ordinaunce & yet heard not of ym. But perceiuing ye banke to grow still yt
shallower we found it 27 & 24 fathoms. Therefore being a fogg & fearing
wee were too neere land we tackt about for sea roome for 2 or 3 watches,
& steered Southeast.
Wednesday very foggie still & wind S: and by w: & sounding
[17] found no bottome yt we could reach.
Thursday wind full w: & contrary to vs. This day a notorious
[18] wicked fellow yt was giuen to swearing & boasting of his former
wickednes bragged yt hee had got a wench wth child before hee came this
voyage & mocked at or daies of fast railing & jesting agt puritans, this fellow
fell sicke of ye pockes & dyed. Wee sounded and found 38 fathom, &
stayed for a little to take soe codfish & feasted orselves merily.
Fryday wind west still, a very fayre cleare day. About 4 a clock in
[19] y afternoone soe went vp to ye top of ye mast, & affirmed to or great
e

cofort yy saw land to ye north eastward.

Saturday wind So: w: a fayre gale: we sounded & found 40, 30,
[20] 22, & a little after no ground.
Sabb: being ye 6th Lords day; wind westerly but fayre & calme.
 Monday wind Easterly a fayre gale. This day wee saw a great
[21] deale of froth not farre fro vs: wee feared it might bee soe breach of
agt some new qvote.[2] Therefore ye mr of or shipp hoised out
[22] water
ye shalop & went wth soe of ye men to see what it was; but found it
onely to bee a froath carried by ye streame.
Tewsday ye wind n: E: a fayre gale. This day we examined
[June 23] 5 beastly Sodomiticall boyes, wch confessed their wickednes
not to bee named. The fact was so fowle wee referred ym to bee punished
by ye governor when we came to new England, who afterward sent ym
backe to ye copany to bee punished in ould England as ye crime deserued.
Wednesday wind no: E: a fayre day & cleare: about 9 a clocke in
[24] y morning we espied a shipp about 4 leagues behind vs; wch
e

prooued ye lions whelpe, wch had bene a weeke separated fro vs. we
stayed for [blot (her)] copany. This day a child of goodman Blacke wch had a
cosumpcon before it came to shipp, dyed. This day we had all a cleare &
cofortable sight of America, & of ye Chap Sable yt was ouer agt vs 7 or 8
leagues northward. Here we saw yellow gilliflowers on ye sea.
Thursday wind still no: Ea: a full & fresh gale. In ye after noone
[25] wee had a cleare sight of many Islands & hills by ye sea shoare.
Now we saw abundaunce of makrill, a great store of great whales puffing
vp water as yy goe, soe of ym came neere or shipp: their greatnes did
astonish vs yt saw ym not before: their backs appeared like a little Island. At
5 a clock at[3] night the wind turned S. E. a fayre gale. This day we caught
mackrill.
Fryday a foggie morning, but after cleare and wind calme. We
[26] saw many scools of mackrill, infinite multitudes on every side our
ship. The sea was abundantly stored with rockweed and yellow flowers like
gilly-flowers. By noon we were within 3 leagues of Capan, and as we
sayled along the coasts we saw every hill and dale and every island full of
gay woods and high trees. The nearer we came to the shoare the more
flowers in abundance, sometymes scattered abroad, sometymes joyned in
sheets 9 or 10 yards long, which we supposed to be brought from the low
meadowes by the tyde. Now what with fine woods and greene trees by
land, and these yellow flowers paynting the sea, made us all desirous to
see our new paradise of New England, whence we saw such forerunning
signals of fertilitie afarre off. Coming neare the harbour towards night we
takt about for sea-roome.
 Saturday a foggie morning; but after 8 o’clocke in the morning
[27] very cleare, the wind being somewhat contrary at So. and by West,
we tackt to and againe with getting little; but with much adoe, about 4
o’clock in the afternoone, having with much payne compassed the harbour,
and being ready to enter the same, see how things may suddenly change!
there came a fearfull gust of wind and rayne and thunder and lightning,
whereby we were borne with no little terrour and trouble to our mariners,
having very much adoe to loose downe the sayles when the fury of the
storme held up. But God be praised it lasted but a while and soone abated
agayne. And hereby the Lord shewed us what he could have done with us,
if it had pleased him. But blessed be God, he soone removed this storme
and it was a fayre and sweet evening.
We had a westerly wind which brought us between 5 and 6 o’clock to a
fyne and sweet harbour,[4] 7 miles from the head point of Capan. This
harbour 20 ships may easily ryde therein, where there was an island
whither four of our men with a boate went, and brought backe agayne ripe
strawberries and gooseberries, and sweet single roses. Thus God was
merciful to us in giving us a tast and smell of the sweet fruit as an earnest
of his bountiful goodnes to welcome us at our first arrivall. This harbour was
two leagues and something more from the harbour at Naimkecke, where
our ships were to rest, and the plantation is already begun. But because
the passage is difficult and night drew on, we put into Capan harbour.
The Sabbath, being the first we kept in America, and the 7th
[28] Lord’s day after we parted with England.
Monday we came from Capan, to go to Naimkecke, the wind
[29] northerly. I should have tould you before that the planters spying our
English colours the Governour sent a shalop with 2 men on Saturday to
pilot us. These rested the Sabbath with us at Capan; and this day, by God’s
blessing and their directions, we passed the curious and difficult entrance
into the large spacious harbour of Naimkecke. And as we passed along it
was wonderful to behould so many islands replenished with thicke wood
and high trees, and many fayre greene pastures. And being come into the
harbour we saw the George to our great comfort then being come on
Tuesday which was 7 daies before us. We rested that night with glad and
thankful hearts that God had put an end to our long and tedious journey
through the greatest sea in the world.
The next morning the governour came aboard to our ship, and
[30] bade us kindly welcome, and invited me and my wiffe to come on
shoare, and take our lodging in his house, which we did accordingly.
 Thus you have a faithful report collected from day to day of all the
particulars that were worth noting in our passage.

Now in our passage divers things are remarkeable.

First, through God’s blessing our passage was short and speedy, for
whereas we had 1000 leagues, that is 3000 miles English, to saile from
Ould to New England, we performed the same in 6 weeks and 3 dayes.
Secondly, our passage was comfortable and easie for the most part,
having ordinarily fayre and moderate wind, and being freed for the most
part from stormie and rough seas, saving one night only, which we that
were not used thought to be more terrible than indeed it was, and this was
Wednesday at night May 27th.
Thirdly, our passage was also healthfull to our passengers, being freed
from the great contagion of the scurvie and other maledictions, which in
other passages to other places had taken away the lives of many. And yet
we were in all reason in wonderful danger all the way, our ship being
greatly crowded with passengers; but through God’s great goodness we
had none that died of the pockes but that wicked fellow that scorned at
fasting and prayer. There were indeed 2 little children, one of my owne and
another beside; but I do not impute it meerely to the passage; for they were
both very sickly children, and not likely to have lived long, if they had not
gone to sea. And take this for a rule, if children be healthfull when they
come to sea, the younger they are the better they will endure the sea, and
are not troubled with sea-sicknes as older people are, as we had
experience in many children that went this voyage. My wiffe indeed, in
tossing weather, was something ill by vomiting, but in calme weather she
recovered agayne, and is now much better for the sea sicknes. And for my
owne part, whereas I have for divers yeares past been very sickly and
ready to cast up whatsoever I have eaten, and was very sicke at London
and Gravesend, yet from the tyme I came on shipboard to this day, I have
been straungely healthfull. And now I can digest our ship diett very well,
which I could not when I was at land. And indeed in this regard I have great
cause to give God praise, that he hath made my coming to be a method to
cure me of a wonderful weake stomacke and continual payne of
melancholly wynd from the splene: Also divers children were sicke of the
small pockes, but are safely recovered agayne, and 2 or 3 passengers
towards the latter end of the voyage fell sicke of the scurvie, but coming to
land recovered in a short tyme.
Fourthly, our passage was both pleasurable and profitable. For we
received instruction and delight in behoulding the wonders of the Lord in
the deepe waters, and sometimes seeing the sea round us appearing with
a terrible countenance, and as it were full of high hills and deepe vallyes;
and sometimes it appeared as a most plain and even meadow. And ever
and anon we saw divers kynds of fishes sporting in the great waters, great
grampuses and huge whales going by companies and puffing up water-
streames. Those that love their owne chimney corner, and dare not go farre
beyond their owne townes end shall neever have the honour to see these
wonderfull workes of Almighty God.
Fifthly, we had a pious and christian-like passage; for I suppose
passengers shall seldom find a company of more religious, honest and
kynd seamen than we had. We constantly served God morning and
evening by reading and expounding a chapter, singing, and prayer. And the
Sabbath was solemnely kept by adding to the former, preaching twise and
catechising. And in our great need we kept 2 solemne fasts, and found a
gracious effect. Let all that love and use fasting and praying take notise that
it is as prevaileable by sea as by land, wheresoever it is faithfully
performed. Besides the ship master and his company used every night to
sett their 8 and 12 a clocke watches with singing a psalme and prayer that
was not read out of a booke. This I wryte not for boasting and flattery; but
for the benefit of those that have a mynd to come to New England
hereafter, that if they looke for and desyre to have as prosperous a voyage
as we had, they may use the same meanes to attayne the same. So letting
passe our passage by sea, we will now bring our discourse to land on the
shoare of New England, and I shall by God’s assistance endeavour to
speake nothing but the naked truth, and both acquaint you with the
commodities and discommodities of the country.
NEW-ENGLANDS PLANTATION
&c.
 NEW-ENGLANDS
PLANTATION
OR,
A S H O RT A N D T RV E
DESCRIPTION OF THE
CO MMO DIT IES AND
DISCOMMODITIES
o f t h a t C o u n t r e y.

Written by Mr Higgeson, a reuerend

Diuine now there resident.

Whereunto is added a Letter, sent by

r
M Graues an Enginere, out of New England.
The third Edition, enlarged.

L O ND O N.
Printed by T. and R. Cotes for Michael Sparke,
dwelling at the Signe of the Blue Bible in
Greene-Arbor, 1630.
 To the Reader.
REader, doe not disdaine to reade this Relation: and looke not here
to haue a large Gate and no building within: a full-stuffed Tittle with
no matter in the Booke: But here reade the truth, and that thou shalt
find without any frothy bumbasting words, or any quaint new-deuised
additions, onely as it was written (not intended for the Presse) by a
reuerend Diuine now there liuing, who onely sent it to some Friends
here, which were desirous of his Relations; which is an Epitomy of
their proceedings in the Plantation. And for thy part if thou meanest
to be no Planter nor Venturer doe but lend thy good Prayers for the
furtherance of it. And so I rest a Well-Wisher to all the good designes
both of them which are gone, and of them that are to goe.
M. S.
 NEW-ENGLANDS
PLANTATION.
LEtting passe our Voyage by Sea, we will now begin our discourse
on the shore of New-England. And because the life and wel-fare of
euery Creature heere below, and the commodiousnesse of the
Countrey whereas such Creatures liue, doth by the most wise
ordering of Gods prouidence, depend next vnto himselfe, vpon the
temperature and disposition of the foure Elements, Earth, Water,
Aire, and Fire (For as of the mixture of all these, all sublunary things
are composed; so by the more or lesse injoyment of the wholesome
temper and conuenient vse of these, consisteth the onely well-being
both of Man and Beast in a more or lesse comfortable measure in all
Countreys vnder the Heauens) Therefore I will indeauour to shew
you what New-England is by the consideration of each of these
apart, and truly indeauour by Gods helpe to report nothing but the
naked truth, and that both to tell you of the discommodities as well
as of the commodities, though as the idle Prouerbe is, Trauellers
may lye by autoritie, and so may take too much sinfull libertie that
way. Yet I may say of my selfe as once Nehemiah did in another
case: Shall such a Man as I lye? No verily: It becommeth not a
Preacher of Truth to be a Writer of Falshod in any degree: and
therefore I haue beene carefull to report nothing of new England but
what I haue partly seene with mine owne Eyes, and partly heard and
inquired from the mouths of verie honest and religious persons, who
by liuing in the Countrey a good space of time haue had experience
and knowledge of the state thereof, & whose testimonies I doe
beleeue as my selfe.
 First therefore of the Earth of New-England and all the
appertenances thereof: It is a Land of diuers and sundry sorts all
about Masathulets Bay, and at Charles Riuer is as fat blacke Earth
as can be seene any where: and in other places you haue a clay
soyle, in other grauell, in other sandy, as it is all about our Plantation
at Salem, for so our Towne is now named, Psal. 76. 2.
The forme of the Earth here in the superficies of it is neither too
flat in the plainnesse, nor too high in Hils, but partakes of both in a
mediocritie, and fit for Pasture, or for Plow or meddow ground, as
Men please to employ it: though all the Countrey bee as it were a
thicke Wood for the generall, yet in diuers places there is much
ground cleared by the Indians, and especially about the Plantation:
and I am told that about three miles from vs a Man may stand on a
little hilly place and see diuers thousands of acres of ground as good
as need to be, and not a Tree in the same. It is thought here is good
Clay to make Bricke and Tyles and Earthen-Pot as need to be. At
this instant we are setting a Bricke-Kill on worke to make Brickes and
Tyles for the building of our Houses. For Stone, here is plentie of
Slates at the Ile of Slate in Masathulets Bay, and Lime-stone, Free-
stone, and Smooth-stone, and Iron-stone, and Marble-stone also in
such store, that we haue great Rocks of it, and a Harbour hard by.
Our Plantation is from thence called Marble-harbour.
Of Minerals there hath yet beene but little triall made, yet we are
not without great hope of being furnished in that Soyle.
The fertilitie of the Soyle is to be admired at, as appeareth in the
aboundance of Grasse that groweth euerie where both verie thicke,
verie long, and verie high in diuers places: but it groweth verie wildly
with a great stalke and a broad and ranker blade, because it neuer
had been eaten with Cattle, nor mowed with a Sythe, and seldome
trampled on by foot. It is scarce to be beleeued how our Kine and
Goats, Horses and Hogges doe thriue and prosper here and like well
of this Countrey.
In our Plantation we haue already a quart of Milke for a penny: but
the aboundant encrease of Corne proues this Countrey to bee a
wonderment. Thirtie, fortie, fiftie, sixtie are ordinarie here: yea