Dti 1 2023

DISRUPTIVE
TECHNOLOGY AND
INNOVATION
K.MOHANASUNDARAM
MGT 3233
LTP : 3-0-1
CREDIT 4
Recommended textbook
• Management Information Systems- Managing the digital firm
• Kenneth C Laudon and Jane P.Laudon
Modules
• Overview of information system
• Information technology
• Innovations
• Disruptive technologies
• Digital transformation
• Management consulting
1.OVERVIEW OF INFORMATION
SYSTEMS
• DATA
• INFORMATION
• KNOWLEDGE
• INTELLIGENCE
• BIG DATA
• COMPONENTS OF IS
• IS RESOURCES
• FUNDAMENTAL ROLES OF IS APPLICATIONS IN BUSINESS
• TYPES OF IS
Information system – An overview
• Discuss common applications of computers and information systems
• Explain the differences between computer literacy and information literacy
• Define transaction-processing systems
• Define management information systems
• Describe the four major components of an information system
• Discuss the differences between data and information
• Explain the importance and applications of information systems in functional
areas of a business
• Discuss how information technologies are used to gain a competitive advantage
• Explain the Five Forces Model and strategies for gaining a competitive advantage
• Review the IT job market
• Summarize the future outlook of information systems
Computers and information systems
• Many uses
• Reduce costs
• Gain a competitive advantage in the marketplace
• Online classes
• Grocery and retail stores
• Telecommuting
• Social networking
• Video sharing
Computer literacy
• Computer literacy
• Skill in using productivity software, as well as having a basic knowledge of
hardware and software, the Internet, and collaboration tools and
technologies
• Software examples: word processors, spreadsheets, database management systems, and
presentation software
• Productivity software
• Productivity tools are software designed to simplify tasks, streamline
workflow and often include features that allow you to access documents
quickly, create charts and graphs to visualize project planning, progress, etc.,
and collaborate with other people
Productivity software examples
• MS Office
• Libre office
• Google workspace
• Zoho office suite
• Apple iWork
• Which includes DMBS, WP, Spreadsheet applications and graphical software
Productivity Software List
• Google Apps for Business. Google’s office suite includes a selection of office productivity tools including enhanced-for-business
versions of Gmail, Google Talk, Google Calendar, Google Docs, Google Sites, and Google Video. Several pricing options are available,
based on the size of your business, and limited-time free trial is also available.
• LibreOffice Productivity Suite. This free office productivity suite comes from the not-for-profit organization, The Document
Foundation. Applications include Writer, Calc, Impress, Draw, Base, and Math. Because it’s free, support comes primarily from the
community of users and the developers. The license for this suite is LGPL, meaning it can be customized as needed.
• OpenOffice. Another free office productivity suite. The following are included in this suite: Writer, Calc, Impress, Draw, Base, and
Math. Oracle is the primary contributor of code to OpenOffice, but other major companies also contribute. For technical support,
they offer a forum and a FAQ site as well as a user guide.
• Microsoft Office. The Microsoft Office Suite has a variety of configurations from home use to student use to use by various size
businesses. Depending on the configuration, the applications included in the suite can change, but it usually includes at least Word,
Excel, PowerPoint, Outlook, and OneNote. The suite is not free (although some versions may have a free trial), but there are a huge
number of free templates available on the Microsoft site.
• WordPerfect Office X5. Another office productivity suite that offers multiple configurations based on the customer need. The home
and student version includes software for word processing, spreadsheets, slideshows and presentations, and a digital notebook.
Free trials are available although the productivity suite is not free. Some templates are also available. Support plans are available
and there is also knowledgebase of frequently asked questions.
• Zoho. Zoho offers a large number of productivity software tools, but as far as I could tell they are not packaged together in a suite.
As of the time of publication, Zoho products were free for personal use, although the site stated that business and corporate users
may be charged. Some Zoho tools that may be of particular interest include: Writer, Sheet, Show, and Calendar. Support is available.
• Quickoffice & OfficeSuite Pro5. While these are technically not office suites themselves, these apps give the
capability to access your Microsoft Office files from your mobile device. For the freelancer on the go this means
mobility. OfficeSuite Pro5 is specifically for the Android Market. Quickoffice can work with a variety of mobile
devices.
• PlusOffice Free 3.0. A freeware package is based on OpenOffice. Use this on Windows 7/Vista (I did not see a
Mac version). The suite includes a text editor, spreadsheet, presentation package, and more. Compare
with commercial packages.
• IBM (r) Lotus (r) SmartSuite (r). This suite will cost money, but the product also has the support of IBM. It
includes Word Pro (r), Freelance Graphics (r), and Approach (r). Additional software options are available for
an added cost.
• ThinkFree. This office productivity prides itself on being compatible with MS Office. Use it for word processing,
creating spreadsheets, and presentations. There are many versions of this suite available, including one for the
Windows, the Mac, Linux, and even Android operating systems. Even though this suite costs money, you can
download a trial version.
• KOffice. This is another free office productivity suite alternative. It includes KWord (a word processor), KCells (a
spreadsheet) and Showcase (presentation software). Because it’s free, it largely depends on volunteers and
users to maintain and update it. There is a Userbase and forum.
• NEOOffice. This is an office suite specifically for MAC OS X. They’ve even included a mobile version that can be
accessed remotely. It is distributed under the GNU General Public License (GPL). It is funded entirely by user
donations.
• Softmaker. This office productivity suite includes TextMaker (word processing), PlanMaker (spreadsheet), and
Presentations. There are multiple versions available including a mobile version. This package does cost money.
Information literacy
• Information literacy: understanding the role of information in
generating and using business intelligence (BI)
• BI provides historical, current, and predictive views of business operations
and environments and gives organizations a competitive advantage in the
marketplace
TPS
• Transaction-processing systems (TPSs)
• Focus on data collection and processing
• Used for cost reduction
• Applied to structured tasks (e.g., record keeping, simple clerical operations,
and inventory control)
• Require minimal human involvement when automated
Management information system (MIS)
Organized integration of hardware and software technologies, data, processes,
and human elements
• Designed to produce timely, integrated, relevant, accurate, and useful
information for decision-making
• Designing tasks
• Define the system’s objectives
• Collect and analyze data
• Provide information in a useful format for decision-making purposes
• MIS applications
• Used in both private and public sectors
MIS software
• Amazon Web Services. …
• Amazon Web Services
• Ataccama. …
• Description: Ataccama ONE is a comprehensive master data management product that offers an intriguing list of
capabilities for many use cases. The solution offers a machine learning-centric user interface, as well as a data
processing engine that is responsible for data transformations, evaluating business rules, and matching and
merging rules. The platform supports any data, domain, and a variety of integrations.
• Cloudera. …
• Description: Cloudera provides a data storage and processing platform based on the Apache Hadoop ecosystem,
as well as a proprietary system and data management tools for design, deployment, operations, and production
management. Cloudera acquired Hortonworks in October 2018. It followed that up with a buy of San Mateo-
based big data analytics provider Arcadia Data last September. Cloudera’s new integrated data management
product (Cloudera Data Platform) enables analytics across hybrid and multi-cloud.
• Collibra. …
• Description: Collibra’s Data Dictionary documents an organization’s technical metadata and how it is used. It
describes the structure of a piece of data, its relationship to other data, and its origin, format, and use. The
solution serves as a searchable repository for users who need to understand how and where data is stored and
how it can be used. Users can also document roles and responsibilities and utilize workflows to define and map
data. Collibra is unique because the product was built with business end-users in mind.
• Commvault. …
• Description: Commvault is well-known in the backup and disaster recovery marketplace, performing as one of the top
solution providers. The company also offers a cloud data management product that allows organizations to manage data
via on-prem and cloud deployments. Users can fully manage data across files, applications, databases, hypervisors, and
clouds (including Amazon Web Services, Microsoft Azure, Google Cloud, and Oracle Cloud). The tool also includes
Commvault’s popular backup and disaster recovery, as well as e-discovery, capabilities.
• Druva. …
• Description: Druva Phoenix offers data availability and governance functionality for virtual machines and physical servers.
Its cloud-centric approach is unique and combines high-performance, scalable backup, disaster recovery, archival, and
analytics. The product can be deployed quickly at sites located around the world while also aligning with regional data
storage regulations. Phoenix can also be managed from a central location to provide full control over server backups and
data composition.
• Google.
• Description: Google offers a fully-managed enterprise data warehouse for analytics via its BigQuery product. The solution
is serverless and enables organizations to analyze any data by creating a logical data warehouse over managed, columnar
storage, and data from object storage and spreadsheets. BigQuery captures data in real-time using a streaming ingestion
feature, and it’s built atop the Google Cloud Platform. The product also provides users the ability to share insights via
datasets, queries, spreadsheets, and reports.
• Hewlett Packard Enterprise (HPE)
• HITACHI
• IBM
• SAP
Exhibit Major Components of an Information System
Copyright ©2019 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Data
• Data component of an information system

• Considered the input to the system
• Sources of data
• Internal: sales and personnel records
• External: customers, competitors, suppliers, government agencies,
financial institutions, labor and population statistics, as well as
economic conditions
Data
• Has a time orientation

• Past data: performance reports
• Current data: operational reports
• Can be collected in different forms
• Disaggregated data: helps analyze sales by product, territory, or
salesperson
• Aggregated data: useful for reporting overall performance during a
sales quarter
Database
• Collection of relevant data organized in a series of

integrated files
• Essential for the success of any information system
• Database management system (DBMS)
• Used to create, organize, and manage databases
• Reduces personnel time needed to gather, process, and
interpret data manually
Process
• Generates the most useful type of information for making

decisions
• Transaction-processing reports
• Models for decision analysis that can be built into the system or
accessed from external sources
Information
• Consists of facts analyzed by the process component and is

an output of an information system
• Usefulness qualities
• Timeliness
• Integration with other data and information
• Consistency and accuracy
• Relevance
Information
• Needs to provide either a base for users to explore different

options or insight into tasks
• Usefulness is affected by the information system’s user
interface
• Graphical user interfaces (GUIs) are used because they are flexible
and easy
Information
• Systems should produce information in different formats,

including graphics, tables, and exception reports
• Increases likelihood of users understanding and being able to use
the information
• Users need to be able to make use of informal information
when solving problems
Using Information Systems and Information Technologies
• Information technologies
• The Internet
• Computer networks
• Database systems
• Point-of-sale (POS) systems
• Radio-frequency-identification (RFID) tags
The Importance of Information Systems
• Timely, relevant, and accurate information is a critical tool

• Enhance a company’s competitive position in the marketplace
• Manage the four Ms of resources
• Manpower, machinery, materials, and money
• Personnel information system (PIS) or human resource

information system (HRIS)
• Designed to provide information that helps decision makers in
personnel carry out tasks effectively
• Logistics information system (LIS)
• Designed to reduce the cost of transporting materials while
maintaining safe and reliable delivery
• Manufacturing information system

• Used to manage manufacturing resources
• Reduce manufacturing costs
• Increase product quality
• Improve inventory decisions
• Financial information system (FIS)

• Used to provide information to financial executives in a timely
manner
• Marketing information system (MKIS)
• Used to improve marketing decisions
• Provides timely, accurate, and integrated information about the
marketing mix
• Price, promotion, place, and product
• Marketing technology tools

• Business, Web, and mobile analytics
• E-mail marketing
• Search engine marketing
• Mobile technologies
• Marketing automation
Using Information Technologies for a Competitive Advantage
• Michael Porter: three strategies for successfully competing

in the marketplace
• Overall cost leadership
• Differentiation
• Focus
• Information systems
• Help organizations reduce the cost of products and services
• Help bottom-line and top-line strategies
• Use enterprise systems to create an efficient and effective link
between suppliers and consumers
• Differentiation strategies
• Making products and services different from competitors
• Focus strategies
• Focusing on specific market segments to achieve a cost or
differentiation advantage
Porter’s Five Forces Model: Understanding the
Business Environment
• Analyzes a firm’s position in the marketplace and how

information systems can make it more competitive
• Five forces
• Buyer power
• Supplier power
• Threat of substitute products or services
• Threat of new entrants
• Rivalry among existing competitors
Exhibit The Five Forces Model
Porter’s Five Forces Model
• Buyer power
• High when customers have many choices and low when customers
have few choices
• Supplier power
• High when customers have fewer options and low when customers
have more options
• Threat of substitute products or services
• High when many alternatives to an organization’s products and
services are available
Porter’s Five Forces Model
• Threat of new entrants

• Low when duplicating a company’s product or service is difficult
• Focus strategies are used to ensure that the threat remains low
• Rivalry among existing competitors
• High when competitors occupy the same marketplace position
• Low when there are few competitors
The IT Job Market
• Categories of IT jobs
• Operations and help desk
• Programming
• Systems design
• Web design and Web hosting
• Network design and maintenance
• Database design and maintenance
• Robotics and artificial intelligence
The IT Job Market
• Chief technology officer (CTO)/chief information officer

(CIO)
• Oversees long-range planning and monitors new developments that
can affect a company’s success
• Chief privacy officer (CPO)
• Responsible for managing risks and business impacts of privacy
laws and policies
The IT Job Market
• Manager of information systems services

• Responsible for managing hardware, software,
and personnel in the information systems
department
• Systems analyst
• Responsible for the design and implementation
of information systems
• Should have a sound understanding of business
systems and functional areas within a business
organization
The IT Job Market
• Network administrator
• Oversees a company’s internal and external network systems
• Provides network and cybersecurity
• Database administrator (DBA)
• Responsible for database design and implementation
• Required to have knowledge and understanding of data warehouses
and data-mining tools
The IT Job Market
• Computer programmer
• Writes programs or software segments that allow the information
system to perform a specific task
• Webmaster
• Designs and maintain the organization’s Web site
• Have been in high demand owing to the popularity of e-commerce
applications
Outlook for the Future (1 of 3)
• Predictions for the future

• Hardware and software costs will decline
• Artificial intelligence and related technologies will improve and
expand
• Computer literacy and networking technology will improve
• Personal computers will improve in power and quality
• Internet growth will continue
• Computer criminals will become more sophisticated

• Protecting personal information will become more difficult
• Some of the trends that should continue

• Ubiquitous computing and the Internet of Things (IoT)
• 3D printing, pervasive analytics, context aware computing, smart
machines and devices, and cloud computing
• Software defined applications and infrastructures
• Security
• Increased applications of augmented and virtual reality
Summary
• Computers and information systems are used to reduce costs

and gain a competitive advantage in the marketplace
• Information systems are designed to collect data, process it,
and deliver timely, relevant, and useful information for
making decisions
Learning Objectives
1.1 How are information systems transforming business, and why

are they so essential for running and managing a business
today?
1.2 What is an information system? How does it work? What are
its management, organization, and technology components?
Why are complementary assets essential for ensuring that
information systems provide genuine value for organizations?
1.3 What academic disciplines are used to study information
systems, and how does each contribute to an understanding of
information systems?
1.4 How will MIS help my career?
How Information Systems Are Transforming Business
• Global spending on information technology (IT) and IT

services: nearly $3.8 trillion in 2019; $160 billion spent on
management consulting and services
• Organizational, management, and cultural changes are often
required for firms to derive full business value from IT
investments
Information Technology Capital Investment
What’s New in Management Information Systems
• I T Innovations
– Cloud computing, big data, Internet of Things
– Mobile digital platform
– AI and machine learning
– Use of social networks for business objectives
• New Business Models
– Online streaming and downloadable video
• Examples: Netflix, Apple TV Channels, Amazon
• E-commerce Expansion
– E-commerce worldwide expands to nearly $3.6 trillion in 2019
– Growth in social commerce spurred by growth of mobile platform
– Mobile retail e-commerce growing more than 20 percent a year,
reaching almost $300 billion in 2020
• Management Changes
– Managers becoming more mobile
– Managers use social networks, collaboration tools
– Business intelligence applications accelerate
• Firms and Organizations Change

– More collaborative, less emphasis on hierarchy and structure
– Greater emphasis on competencies and skills
– Higher-speed/more accurate decision making based on data and
analysis
– More willingness to interact with consumers (social media)
– Better understanding of the importance of I T
Globalization Challenges and Opportunities: A Flattened
World
• Internet and global communications have greatly changed how

and where business is done
– Drastic reduction of costs of operating and transacting on
global scale
– Competition for jobs, markets, resources, ideas
– Growing interdependence of global economies
– Requires new understandings of skills, markets,
opportunities
– Iphone & ipad  applications for business ?? (salesforce, Cisco Webex meetings, SAP business
one, iwork, Evernote, Adobe Acrobat reader, Oracle business intelligence mobile, dropbox
The Emerging Digital Firm
• In a fully digital firm:

– Significant business relationships are digitally enabled and
mediated
– Core business processes are accomplished through digital
networks
– Key corporate assets are managed digitally
• Digital firms offer greater flexibility in organization and
management
– Time shifting, space shifting
Strategic Business Objectives of Information Systems (1 of
2)
• Growing interdependence between:

– Ability to use information technology
– Ability to implement corporate strategies and achieve
corporate goals
Figure 1.2 The Interdependence Between
Organizations and Information Systems
Strategic Business Objectives of Information Systems (2 of
2)
• Firms invest heavily in information systems to achieve six

strategic business objectives:
1. Operational excellence
2. New products, services, and business models
3. Customer and supplier intimacy
4. Improved decision making
5. Competitive advantage
6. Survival
Operational Excellence
• Improved efficiency results in higher profits

• Information systems and technologies help improve efficiency
and productivity
• Example: Walmart
– Power of combining information systems and best business
practices to achieve operational efficiency—and over $524
billion in sales in 2019
– Most efficient retail store in world as result of digital links
between suppliers and stores
New Products, Services, and Business Models
• Information systems and technologies enable firms to create new

products, services, and business models
• Business model: how a company produces, delivers, and sells its
products and services
• Example: Apple
– Transformed old model of music distribution with iTunes
– Constant innovations—iPod, iPhone, iPad, etc.
Customer and Supplier Intimacy
• Customers who are served well become repeat customers who

purchase more
– Example: Mandarin Oriental Hotel
– Uses I T to foster an intimate relationship with its customers,
keeping track of preferences, etc.
• Close relationships with suppliers result in lower costs
– Examples: Mandarin Oriental Hotel and J C Penney (in text)
– J C Penney uses I T to enhance relationship with supplier in Hong
Kong
Improved Decision Making
• Without accurate information, managers must use forecasts,
best guesses, and luck, resulting in misallocation of resources,
inventory, employees
• Real-time data improves ability of managers to make decisions
– Example: Verizon’s web-based digital dashboard to provide
managers with real-time data on customer complaints,
network performance, line outages, etc.
Competitive Advantage
• Often results from achieving previous business objectives
• Advantages over competitors
– Charging less for superior products, better performance, and
better response to suppliers and customers
– Examples: Apple, Walmart, UP S are industry leaders because
they know how to use information systems for this purpose
Survival
• Businesses may need to invest in information systems out of
necessity; it is simply the cost of doing business
• Keeping up with competitors
– Citibank’s introduction of AT Ms
• Federal and state regulations and reporting requirements
– Toxic Substances Control Act and the Sarbanes-Oxley Act
What Is an Information System? (1 of 3)
• Information technology: the hardware and software a business

uses to achieve objectives
• Information system: interrelated components that manage
information to:
– Support decision making and control
– Help with analysis, visualization, and product creation
• Data: streams of raw facts
• Information: data shaped into meaningful, useful form
Figure 1.3 Data and Information
What Is an Information System? (2 of 3)
• Activities in an information system that produce information:

– Input
– Processing
– Output
– Feedback
• Sharp distinction between computer or computer program
versus information system
What is an Information System? (3 of 3)
• Feedback
– Output is returned to appropriate members of organization
to help evaluate or correct input stage
• Computer/computer program vs. information system
– Computers and software are technical foundation and
tools, similar to the material and tools used to build a
house
Figure 1.4 Functions of an Information System
Dimensions of Information Systems
• Organizations
• Management
• Technology
Figure 1.5 Information Systems Are More Than Computers
Dimensions of Information Systems: Organizations (1 of 2)
• Hierarchy of authority, responsibility

– Senior management
– Middle management
– Operational management
– Knowledge workers
– Data workers
– Production or service workers
Figure 1.6 Levels in a Firm
Dimensions of Information Systems: Organizations (2 of 2)
• Separation of business functions

– Sales and marketing
– Human resources
– Finance and accounting
– Manufacturing and production
• Unique business processes
• Unique business culture
• Organizational politics
Dimensions of Information Systems: Management
• Managers set organizational strategy for responding to business

challenges
• In addition, managers must act creatively
– Creation of new products and services
– Occasionally re-creating the organization
Dimensions of Information Systems: Information Technology
• Computer hardware and software

• Data management technology
• Networking and telecommunications technology
– Networks, the Internet, intranets and extranets, World Wide
Web
• I T infrastructure: provides platform that system is built on
It Isn’t Just Technology: A Business Perspective on
Information Systems (1 of 3)
• Information system is instrument for creating value

• Investments in information technology should result in superior
returns
– Productivity increases
– Revenue increases
– Superior long-term strategic positioning
• Business information value chain

– Raw data acquired and transformed through stages that add value to
that information
– Value of information system determined in part by extent to which it
leads to better decisions, greater efficiency, and higher profits
• Business perspective
– Calls attention to organizational and managerial nature of information
systems
• Investing in information technology does not guarantee good returns

• There is considerable variation in the returns firms receive from
systems investments
• Factors
– Adopting the right business model
– Investing in complementary assets (organizational and
management capital)
Figure 1.7 The Business Information Value Chain
Complementary Assets: Organizational Capital and the Right
Business Model (1 of 2)
• Assets required to derive value from a primary investment

• Firms supporting technology investments with investment in
complementary assets receive superior returns
• Example: Invest in technology and the people to make it work
properly
Figure 1.8 Variation in Returns on Information Technology
Investment
Complementary Assets: Organizational Capital
and the Right Business Model (2 of 2)
• Complementary assets
– Examples of organizational assets
• Appropriate business model
• Efficient business processes
– Examples of managerial assets
• Incentives for management innovation
• Teamwork and collaborative work environments
– Examples of social assets
• The Internet and telecommunications infrastructure
• Technology standards
Figure 1.9 Contemporary Approaches to Information Systems
Technical Approach
• Emphasizes mathematically based models
• Computer science, management science, operations research
Behavioral Approach
• Behavioral issues (strategic business integration,

implementation, etc.)
• Psychology, economics, sociology
Approach of This Text: Sociotechnical Systems (1 of 2)
• Management information systems

– Combine computer science, management science, operations
research, and practical orientation with behavioral issues
• Four main actors
– Suppliers of hardware and software
– Business firms
– Managers and employees
– Firm’s environment (legal, social, cultural context)
Approach of This Text: Sociotechnical Systems (2 of 2)
• Sociotechnical view
– Optimal organizational performance achieved by jointly
optimizing both social and technical systems used in
production
– Helps avoid purely technological approach
Figure 1.10 A Sociotechnical Perspective on Information
Systems

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DISRUPTIVE

• Data component of an information system

• Has a time orientation

• Collection of relevant data organized in a series of

• Generates the most useful type of information for making

• Consists of facts analyzed by the process component and is

• Needs to provide either a base for users to explore different

• Systems should produce information in different formats,

• Timely, relevant, and accurate information is a critical tool

• Personnel information system (PIS) or human resource

• Manufacturing information system

• Financial information system (FIS)

• Marketing technology tools

• Michael Porter: three strategies for successfully competing

• Analyzes a firm’s position in the marketplace and how

• Threat of new entrants

• Chief technology officer (CTO)/chief information officer

• Manager of information systems services

• Predictions for the future

• Computer criminals will become more sophisticated

• Some of the trends that should continue

• Computers and information systems are used to reduce costs

1.1 How are information systems transforming business, and why

• Global spending on information technology (IT) and IT

• Firms and Organizations Change

• Internet and global communications have greatly changed how

• In a fully digital firm:

• Growing interdependence between:

• Firms invest heavily in information systems to achieve six

• Improved efficiency results in higher profits

• Information systems and technologies enable firms to create new

• Customers who are served well become repeat customers who

• Information technology: the hardware and software a business

• Activities in an information system that produce information:

• Hierarchy of authority, responsibility

• Separation of business functions

• Managers set organizational strategy for responding to business

• Computer hardware and software

• Information system is instrument for creating value

• Business information value chain

• Investing in information technology does not guarantee good returns

• Assets required to derive value from a primary investment

• Behavioral issues (strategic business integration,

• Management information systems

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