MBSZ02 Enterprise Information Systems

Lecture 3
Cont.

Measure and Manage IS

MUST Dr. Fei HUANG 1

CHAPTER FOUR

MEASURING
THE SUCCESS
OF STRATEGIC
INITIATIVES

MUST Dr. Fei HUANG 2

 LEARNING OUTCOMES
1. Define the primary MIS roles along with their
associated responsibilities.
2. Define critical success factors (CSFs) and key
performance indicators (KPIs) and explain how
managers use them to measure the success of MIS
projects.
3. Explain why a business would use metrics to
measure the success of strategic initiatives.

MUST Dr. Fei HUANG 3

 MIS DEPARTMENT
ROLES AND RESPONSIBILITIES

 Chief information officer (CIO) – Oversees

all uses of MIS and ensures the strategic
alignment of MIS with business goals and
objectives
 Chief knowledge officer (CKO) - Responsible
for collecting, maintaining, and distributing the
organization’s knowledge
 Chief privacy officer (CPO) – Responsible for
ensuring the ethical and legal use of
information
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 MIS DEPARTMENT
ROLES AND RESPONSIBILITIES

 Chief security officer (CSO) –

Responsible for ensuring the security of
MIS systems
 Chief technology officer (CTO) –
Responsible for ensuring the throughput,
speed, accuracy, availability, and
reliability of information technology
» Chief intellectual property officer

» Chief automation officer

» Chief user experience officer

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 MIS DEPARTMENT
ROLES AND RESPONSIBILITIES

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 METRICS: MEASURING
SUCCESS

 Critical success factors (CSFs) – The crucial

steps companies make to perform to achieve their
goals and objectives and implement strategies
» Create high-quality products
» Retain competitive advantages
» Reduce product costs
» Increase customer satisfaction
» Hire and retain the best professionals

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 METRICS: MEASURING
SUCCESS

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 METRICS: MEASURING
SUCCESS

 Key performance indicators (KPIs) – The

quantifiable metrics a company uses to
evaluate progress toward critical success
factors
» Turnover rates of employees
» Number of product returns
» Number of new customers
» Average customer spending

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 EFFICIENCY AND
EFFECTIVENESS
 Efficiency MIS metric – measures the
performance of the MIS system itself
including throughput, speed, and availability

 Effectiveness MIS metric – measures the

impact MIS has on business processes and
activities including customer satisfaction,
conversion rates, and sell-through
increases

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 BENCHMARKING
BASELINING METRICS

 Benchmarks – baseline values the

system seeks to attain

 Benchmarking – a process of
continuously measuring system results,
comparing those results to optimal
system performance (benchmark
values), and identifying steps and
procedures to improve system
performance
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THE INTERRELATIONSHIPS OF EFFICIENCY
AND EFFECTIVENESS MIS METRICS

 Efficiency MIS metrics focus on

technology and include:
» Throughput
» Transaction speed
» System availability
» Information accuracy
» Web traffic
» Response time

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THE INTERRELATIONSHIPS OF EFFICIENCY
AND EFFECTIVENESS MIS METRICS

 Effectiveness MIS metrics focus on

an organization’s goals, strategies,
and objectives and include:
» Usability
» Customer satisfaction
» Conversion rates
» Financial

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 THE INTERRELATIONSHIPS OF EFFICIENCY
AND EFFECTIVENESS MIS METRICS

 Security is an issue for any organization

offering products or services over the Internet

 It is inefficient for an organization to

implement Internet security, since it slows
down processing
» However, to be effective it must implement Internet
security
» Secure Internet connections must offer encryption
and Secure Sockets Layers (SSL denoted by the
lock symbol in the lower right corner of a browser)

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 THE INTERRELATIONSHIPS OF EFFICIENCY
AND EFFECTIVENESS MIS METRICS

 Interrelationships between efficiency and

effectiveness

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 METRICS FOR STRATEGIC
INITIATIVES

 Metrics for measuring and managing

strategic initiatives include:
» Website metrics
» Supply chain management (SCM)
metrics
» Customer relationship management
(CRM) metrics
» Business process reengineering (BPR)
metrics
» Enterprise resource planning (ERP)
MUST Dr.metrics
Fei HUANG 16
 WEBSITE METRICS
 Website metrics include:
» Abandoned registrations
» Abandoned shopping cards
» Click-through
» Conversion rate
» Cost-per-thousand
» Page exposures
» Total hits
» Unique visitors

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 SUPPLY CHAIN
MANAGEMENT METRICS

 Back order
 Customer order promised cycle
time
 Customer order actual cycle time
 Inventory replenishment cycle time
 Inventory turns (inventory turnover)

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 CUSTOMER RELATIONSHIP
MANAGEMENT METRICS

 Customer relationship management

metrics measure user satisfaction and
interaction and include
» Sales metrics
» Service metrics
» Marketing metrics

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 BPR AND ERP METRICS

 The balanced scorecard enables organizations to

measure and manage strategic initiatives
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 CHAPTER FIVE

ORGANIZATIONAL
STRUCTURES
THAT SUPPORT
STRATEGIC
INITIATIVES
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 LEARNING OUTCOMES

1. Explain information ethics and its associated

issues.
2. Describe information security and the
difference between hackers and viruses.

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 INFORMATION ETHICS

 Ethics – The principles and

standards that guide our behavior
toward other people
 Information ethics – Govern the
ethical and moral issues arising
from the development and use of
information technologies, as well
as the creation, collection,
duplication, distribution, and
processing of information itself

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 INFORMATION ETHICS
 Business issues related to information ethics
» Intellectual property
» Copyright
» Pirated software
» Counterfeit software
» Digital rights management

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 INFORMATION ETHICS

 Privacy is a major ethical issue

» Privacy – The right to be left alone when
you want to be, to have control over your
own personal possessions, and not to be
observed without your consent
» Confidentiality – the assurance that
messages and information are available
only to those who are authorized to view
them

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 INFORMATION ETHICS

 Individuals form the only ethical

component of MIS
» Individuals copy, use , and distribute software
» Search organizational databases for sensitive
and personal information
» Individuals create and spread viruses
» Individuals hack into computer systems to
steal information
» Employees destroy and steal information

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 INFORMATION ETHICS
 Acting ethically and legally are not always the same

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 INFORMATION DOES NOT HAVE
ETHICS, PEOPLE DO

 Information does not care how it is used, it will not

stop itself from sending spam, viruses, or highly-
sensitive information
 Tools to prevent information misuse
» Information management
» Information governance
» Information compliance
» Information Secrecy
» Information Property
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 INFORMATION SECURITY

 Organizational information is
intellectual capital - it must be
protected
 Information security – The
protection of information from
accidental or intentional misuse by
persons inside or outside an
organization
 Downtime – Refers to a period of
time when a system is unavailable
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 SECURITY THREATS CAUSED BY
HACKERS AND VIRUSES

 Hacker – Experts in technology who use their knowledge

to break into computers and computer networks, either for
profit or just motivated by the challenge
» Black-hat hacker
» Cracker
» Cyberterrorist
» Hactivist
» Script kiddies or script bunnies
» White-hat hacker

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 SECURITY THREATS CAUSED BY
HACKERS AND VIRUSES

 Virus - Software written with malicious intent to

cause annoyance or damage
» Backdoor program
» Denial-of-service attack (DoS)
» Distributed denial-of-service attack (DDoS)
» Polymorphic virus
» Trojan-horse virus
» Worm

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 SECURITY THREATS CAUSED BY
HACKERS AND VIRUSES

How Computer Viruses Spread

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 SECURITY THREATS CAUSED BY
HACKERS AND VIRUSES

 Security threats to ebusiness include

» Elevation of privilege
» Hoaxes
» Malicious code
» Packet tampering
» Sniffer
» Spoofing
» Splogs
» Spyware
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 LEARNING OUTCOME REVIEW

 Now that you have finished the chapter please

review the learning outcomes in your text

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