Management Information Systems - Class Note # 1

Prof. Yuan-Shyi Peter Chiu Feb. 2012 1

Chapter 1

Managing the Digital Firm

1.1 Why Information Systems

1.2 Contemporary Approaches to Information System

1.3 Toward the Digital Firm: The New Role of Information Systems in Organizations
1.4 Learning to Use Information Systems: New Opportunities with Technology 2

1.1 Why Information Systems

Four powerful worldwide changes have altered the business environment

Emergence of the Global Economy Transformation of Industrial Economies

Transformation of the Business Enterprise

The Emerging Digital Firm

1.1 Why Information Systems Globalization

Management & control in a global marketplace

Competition in world markets

Global work groups Global delivery systems

1.1 Why Information Systems Transformation of Industrial Economies

Knowledge- and information-based economies New products and services KnowledgeA central productive and strategic asset Time-based competition

Shorter product life Turbulent environment Limited employee knowledge base

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Fig 1-1: The growth of the information economy

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1.1 Why Information Systems

Transformation of the Enterprise

Flattening Decentralization Flexibility Location Independence Low Transaction & Coordination Costs Empowerment Collaborative work and teamwork

1.1 Why Information Systems

Emergence of the Digital Firm

Digitally enabled relationships with customers, suppliers, and employees

Core business processes accomplished via digital networks

Digital management of key corporate assets

Rapid sensing and responding to environmental changes

1.1 Why Information Systems

Emergence of the Global Economy

Transformation of Industrial Economies

Transformation of the Business Enterprise The Emerging Digital Firm

Fig 1-3: Function of an information system

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Using information system effectively requires an understanding of the Organization , Management , Information Technology

Fig 1-4
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Organization

People Structure Operating procedures Politics

Culture

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Major Organizational Functions

Sales & Marketing Manufacturing

Finance
Accounting Human Resources

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Major Organizational Functions

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Management

set the organizational strategy

allocate the financial resources allocate the human resources coordinate the work leadership create new products or new services re-create organization from time to time
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Technology

tools to managers
glue that holds the organization together Computer hardware

Computer software
Storage technology Telecommunications technology Information technology Infrastructure
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1.2 Contemporary Approaches to Information Systems

Technical approach Behavioral approach

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Fig 1-5: Contemporary approaches to information system. 18

Technical approach
Computer science

Theories of computability Methods of computation Methods of efficient data storage and access

Management science

Models for decision making Management practices

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Technical approach
Operations research

Mathematical techniques for optimizing selected parameters of organizations, such as transportation, inventory control, etc.

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Behavioral Approach

Sociology

Development of systems System affect individual, groups, and organization.

Psychology How human decision makers perceive

and use formal information .

Economics Impacts to firm and within markets on control cost structures

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Socio-Technical Systems

Figure 1-6

SOURCE: Liker, et al, 1987

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Socio-Technical Systems
Optimize systems performance:

Technology and organization Organizations mutually adjust to one another until fit is satisfactory

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1.3 Toward the Digital Firm: The New Role of I.S. in Organizations

The widening scope of I.S. The network revolution and the internet New options for organizational design:
The Digital Firm and the Collaborative Enterprise

The Digital Firm:

E-commerce, E-business, and New Digital Relationships
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1.3.1 The widening scope of I.S.

Fig 1-7: The interdependence between organizations and information systems 25

1.3.1 The widening scope of I.S.

Fig 1-8: The widening scope of information systems .

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Information Systems

It affects the organization and its employees, and how they can make business more competitive and efficient . It has become essential for creating competitive firms, managing global corporations, and providing useful products and services to customers.

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1.3.2 The network revolution and the internet

What you can do on the internet?

Communicate & collaborate Access information

Participate in discussions
Supply information Find entertainment Exchange business transactions
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1.3.2 The network revolution and the internet

INTERNET

International network of networks that is a collection of hundreds of thousands of private and public networks.

World Wide Web (WWW)

A system with universally accepted standards for storing, retrieving, formatting, and displaying information in a networked environment.
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1.3.3 New Options for Organizational Design

The Digital Firm and the Collaborative Enterprise

Flattening Organizations and the Changing Management Processes

Separating Work from Location

Reorganizing Work Flows

Increasing Flexibility of Organizations Redefining Organizational Boundaries
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1.3.3 New Options for Organizational Design

Flattening Organizations Information Systems

Figure 1-9

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1.3.3 New Options for Organizational Design

Redesigned Work Flow For Insurance Underwriting

Figure 1-10

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1.3.4 The Digital Firm

E-commerce, E-business, and New Digital Relationships

Electronic market

A marketplace that is created by computer and communication technologies that link many buyers and sellers .

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1.3.4 The Digital Firm Electronic Commerce

The process of buying and selling goods and services electronically involving transactions using the internet, networks, and other digital technologies.
Internet Links Buyers, Sellers Lower Transaction Costs Goods & Services Advertised, Bought, Exchanged Worldwide Business-to-Business Transactions Increasing 35

1.3.4 The Digital Firm Intranet

An internal network based on Internet and World Wide Web technology and standards.

Electronic Business

The use of the Internet and other digital technology for organizational communication and coordination and the management of the firm.
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Figure 1-11

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1.4 Learning to Use Information Systems: New Opportunities with Technology

Challenge of Information Systems: Key Management Issues

Strategic: competitive & effective Globalization: multinational info Info architecture: support goals Investment: value of information Responsibility & control: ethics
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Figure 1-12

Information Architecture and Information Technology Infrastructure

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HOMEWORK Chap. 1
#1 Describe four trends in the global business environment that have made information systems so important. #2 What are the organization, management, and technology dimensions of information systems? #3 Name and describe major organizational functions. #4 Distinguish major disciplines of the behavior and the technical approach to information systems. #5 Describe briefly what information systems are. #6 Describe some of the major changes that information systems are bringing to organizations. #7 Define E-Commerce, E-Business, and Intranet. #8 What are the key management challenges involved in building, operating, and maintaining information systems today?

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