Fundamentals of Information Systems

Information Systems in
Global Business Today

DR. IDAVER SHERIFI

 Learning Objectives

1. How are information systems transforming business, and why are so

essential for running and managing a business today ?
2. Why are complementary assets essential for ensuring that information
systems provide genuine value for organizations?
3. What is the role of the information systems function in a business?
 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.
 How Information Systems Are Transforming
Business ?
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 (Netflix, Apple TV Channels,
Amazon)
 How Information Systems Are Transforming
Business ?
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
 How Information Systems Are Transforming
Business ?
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 IT
 Information Systems to Improve Businesses

A digital firm is one in which nearly all of the organization’s significant

business relationships with customers, suppliers, and employees are
digitally enabled and mediated. Core business processes are
accomplished through digital networks spanning the entire organization
or linking multiple organizations.
 Information Systems to Improve Businesses

Business processes refer to the manner in which work is organized,

coordinated and focused to produce a valuable product or service.
Business processes are the collection of activities required to produce a
product or service.
 Information Systems to Improve Businesses

• Routines and business processes

• Routines (standard operating procedures)
• Precise rules, procedures, and practices developed to cope with
virtually all expected situations
• Business processes: Collections of routines
• Business firm: Collection of business processes
Information Systems to Improve Businesses

Business processes example of order fulfillment

 Strategic Business Objectives of
Information Systems

Strategic business objectives of information systems aim to grow

interdependence between:
• Ability to use information technology
• Ability to implement corporate strategies and achieve corporate goals
 Strategic Business Objectives of
Information Systems

The interdependence between organizations and information systems

 Strategic Business Objectives of
Information Systems

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
It Isn’t Just Technology: A Business Perspective on
Information Systems

Information value chain of a business

 It Isn’t Just Technology: A Business Perspective on
Information Systems

Investments in information Investing in information

technology should result in
superior returns:
• Productivity increases
• Revenue increases
VS
• Superior long-term strategic
positioning
technology does not guarantee
good returns. Factors:
• Adopting the right business
model
• Investing in complementary
assets (organizational and
management capital)
Why are complementary assets essential for ensuring that information systems
provide genuine value (returns) for organizations?

Variations in returns on information technology investment

Why are complementary assets essential for ensuring that information systems
provide genuine value (returns) for organizations?

Complementary social, managerial and organizational assets required to optimize returns from
information technology investments
Why are complementary assets essential for ensuring that information systems
provide genuine value (returns) for organizations?

Complementary social, managerial and organizational assets required to optimize returns from
information technology investments
 What is the role of the information systems
function in a business?

CTO/CIO
Programmer
Project Manager
Systems Analyst
Operations Manager
Business Analyst
Database Administrator
 Case Study: Changes in the Financial Industry, Adyen and Fintech

Why do investors pay so much for shares of companies that hardly make any profits?

Is the German bank N26 destroying jobs or creating new jobs?
Case Study: Changes in the Financial Industry, Adyen and Fintech
 References

• Laudon, K. C., & Laudon, J. P. (2022). Information Systems in Global Business Today. In
Management Information Systems: Managing the Digital Firm (17th ed., pp. 37–46). Pearson.
• Laudon, K. C., & Laudon, J. P. (2022). Information Systems in Global Business Today. In
Management Information Systems: Managing the Digital Firm (17th ed., pp. 54–57). Pearson.
• Laudon, K. C., & Laudon, J. P. (2022). Global E-business and Collaboration. In Management
Information Systems: Managing the Digital Firm (17th ed., pp. 96–98). Pearson.
THANK YOU FOR YOUR QUESTIONS ?
ATTENTION!