Introduction to Information

Systems
What is Data?
• Raw fact
• Numbers and strings of letters with no precise
context or meaning
What is Information?

• Data processed with knowledge

• “Data endowed with relevance and purpose”
• “Data becomes information when its creator adds
meaning”
• “An organized, meaningful, and useful interpretation
of data”
What is Knowledge?

• “A body of guidelines and rules used to select,

organize, and manipulate data to make it suitable for
a given task”
• “An awareness and understanding of a set of
information and how that information can be put to
its best use”
• “Internalized information + the ability to utilize this
information”
Data transformed into
Information

A collection of facts organized

in such a way that they have
additional value beyond the
Information value of facts themselves.

Guidelines and procedures used to

select, organize, and manipulate data
Knowledge
Process to make it suitable for a specific task.

Data Raw facts

 Data becomes Information
 Establishing
relationships between
data creates
information.

Information = Data + Relationships

Characteristics of Valuable
Information
• Relevant
• Complete
• Accurate
• Current/Timely
• Economical
• Accessible
Does Perfect Information Lead to
Perfect Decisions?
• IBM
• Among the first to learn that PCs were revolutionizing
the computer industry.
• Wal-Mart
• “We got big by replacing inventory with information”
Wal-Mart
CIO
Determining the Value of
Information
• Measurements
• Time saved, lower costs
• More accurate forecasts
• Improved service
• Often difficult to quantify
• Payback period?
What is a System?
• Components that work together to achieve a goal by
accepting input, processing it, and producing output in an
organized manner.
• e.g. a sound system
A system is a set of elements or components that
interact to accomplish goals.
o In its simplest form, a system is a set of interrelated
components, with a clearly defined boundary, working
together to achieve a common set of objectives by
accepting inputs and producing outputs in an organized
transformation process.
System characteristics
1) Components: A component is either an irreducible part or an
aggregate of parts, also called as a subsystem.
2) Interrelated Components: The function of one component is
tied to the functions of the others. Output from one is input for
another, the dependence of a part on one or more other parts.
3) Boundary: A system has boundary, within which all of its
components are contained and which establishes the limits of a
system, separating it from other systems.
• Components within the boundary can be changed whereas
systems outside the boundary cannot be changed.
4) Purpose: All components work together to achieve the overall
purpose of the system.
System characteristics
5) Environment: A system exist within an environment, everything
outside the system’s boundary that influences and / or interacts the
system.
6) Interfaces: The points at which the system meets its environment and
there are also interfaces between subsystems.
7) Input: System takes input from its environment
8) Output: System returns output to its environment as a result of its
functioning to achieve the purpose. Output from individual
subsystems may be inputs to other subsystems.
9) Constraints: There are limits to what the system can do (capacity,
speed, and capability), some of these constraints are imposed inside
the system and others are imposed by the environment.
Important system concepts
Decomposition – is the process of breaking down a system into its smaller
components.
Decomposing a system allows us to focus on one particular part of a system, making it
easier to think of how to modify that one part independently of the entire system.
Modularity is a direct result of decomposition which divides a system into modules of
a relatively uniform size. This makes it easier to understand the system.
Coupling means that subsystems are dependent on each other, messages are passed
between subsystems.
A good system will have very independent subsystems with minimal flows of
data between them. This makes the system simpler and easier to change just one part
of the system without affecting the other parts.
Cohesion is the extent to which a subsystem performs single functions.
Generally coupling must be reduced and cohesion increased, so that it performs only
one function.
 Components of a System

INPUTS
INPUTS PROCESSING
PROCESSING OUTPUTS
OUTPUTS
Gathering
Gathering and
and Converting
Converting oror Producing
Producing useful
useful
capturing
capturing raw
raw data
data transforming
transforming data
data information,
information, usually
usually in
in
into
into useful
useful outputs
outputs the
the form
form of
of documents.
documents.

Output that is used to

make changes to input
or processing activities

Feedback
System Performance
• Efficiency
A measure of what is produced divided by what is
consumed.
• Effectiveness
A measure of what is achieved divided by the stated goal.
System Variables and Parameters
• System Variable
A quantity or item that can be controlled by the decision
maker (controllable).
• e.g. selling price

• System Parameter
A value or quantity that cannot be controlled by the
decision maker.
• e.g. raw material costs
Business as a system
A business is an example of
an organizational system in
which economic resources
(input) are transformed by
various business processes
(processing) into goods and
services (output).

Information systems provide

information (feedback) about
the operations of the system
to management for the
direction and maintenance of
the system (control) as it
exchanges inputs and
outputs with its
environment.
 Systems Type
Natural and Artificial
o Natural occur in nature without human intervention – Biological
systems- immune systems,
o Artificial human made or modified – Information systems.

Artificial systems are measured in terms of:

o Effectiveness: the extend to which a systems achieves its objectives
o Efficiency: consumption of inputs relative to outputs
o Usability: the ability of the uses to use the system
o Satisfaction: A subjective measure of "like“ or usability or effectiveness
Closed System
• Stands alone
• self contained
• No connection to other systems
Open System
• Interfaces and interacts with other systems
• Gets information from and provides information to
other systems
 Deterministic and probabilistic
o Deterministic: The interaction between the parts or
subsystems is known for certain; – example: a computer
program which performs exactly to a set of instructions
o Probabilistic: A system that can be described in terms of
probable behavior (a certain degree of error); – examples: An
inventory system
 Systems approach
• is based on the generalization that everything is inter-
related and inter­dependent.
• A system is composed of related and dependent element
which when in interaction, forms a unitary whole.
• A system is simply an assemblage or combination of things
or parts forming a complex whole.
Generally systems approach
(i) A system consists of interacting elements.
It is set of inter-related and inter-dependent parts
arranged in a manner that produces a unified whole.
(ii) The various sub-systems should be studied in
their inter-relationships rather, than in isolation from
each other.
(iii) An organisational system has a boundary that
determines which parts are internal and which are
external.
(iv) A system does not exist in a vacuum. It receives
information, material and energy from other systems
as inputs. These inputs undergo a transformation
process within a system and leave the system as
output to other systems.
(v) An organisation is a dynamic system as it is responsive to
its environment. It is vulnerable to change in its environment.
In the systems approach, attention is paid towards the overall
effectiveness of the system rather than the effectiveness of
the sub-systems.
The interdependence of the sub-systems is taken into
account.
The idea of systems can be applied at an organisational level.
So, What is an Information
System?
Information: An System: Components that work
together to achieve a goal by
organized, meaningful, accepting input, processing it,
and useful interpretation and producing output in an
of data organized manner
• Information System: Components that work together to
process data and produce information (to help companies
solve problems and make decisions).
• An information system is a set of interrelated components
that collect, manipulate, store data and disseminate
information and provide a feedback mechanism to monitor
performance
What is an Information System?

An organized combination of people, hardware,

software, communications networks, and data
resources that collects data, transforms it, and
disseminates information.
CBIS
Hardware:
Computer Equipment
Software:
• Operating systems
• Applications
Databases:
An organized collections of facts
CBIS
Telecommunications:
Electronic transmission of signals for
communication
 Networks: Distant electronic communication
 Internet: Interconnected Networks
 Intranet: Internal Corporate Network
 Extranet: Linked Intranets
CBIS
People

Procedures:
Strategies, policies, methods, and
rules for using a CBIS.
 Dimensions of Information Systems

Three Important Dimensions of Information Systems

• Organizations

• Managers

• Technology

You must need to understand and balance these

dimensions of information systems in order to
create business value.
The Organizational Dimension of IS

• People

• Structure

• Business processes

• Culture

• Politics
The Management Dimension of IS

Managers are:

• Sense makers

• Decision makers

• Planners

• Innovators of new processes

• Leaders: set agendas

The Management Dimension of IS

Managers who can understand the role of

information systems in creating business value
are the key ingredient to success with systems,
and cannot easily be replicated by your
competitors.
 The Technology Dimension of IS

Information technology is one of the tools

managers use to cope with change:

• Hardware: Physical equipment

• Software: Detailed preprogrammed instructions

• Storage: Physical media for storing data and the

software
 The Technology Dimension of IS

• Communications technology: Transfers data from

one physical location to another
• Networks: Links computers to share data or
resources
Managers need to know enough about information
technology to make intelligent decisions about how
to use it for creating business value.