What is an Information System: Digital Technologies in a Global Society Flashcards
How are information systems transforming global business?
IT is used to respond quicker to customer demand, reduce inventories to the lowest possible level through data predictions (and trends like just-in-time inventory) and achieve operational efficiency
Globalization, through increased IT tools for collaboration
Just-in-time inventory
Reduces overhead costs and get to market faster
You use information systems and data prediction to make it work
Digital Firm and its characteristics (4)
The characteristics:
oNearly all of the organization’s significant business relationships with customers, suppliers, and employees are digitally enabled and mediated.
oCore business processes are accomplished through digital networks spanning the entire organization or linking multiple organizations.
oTime shifting: Business is conducted continuously 24/7 and not just a 9-5 workday
oSpace shifting: Work takes place in a global workshop as well as within national boundaries, and any physical work is accomplished wherever in the world it is best accomplished.
More flexible to respond to change than physical firms
Business Processes
A collection of activities required to produce a product or service (how work is organized, coordinated and focused to produce a valuable product or service)
A set of logically related tasks and behaviors that organizations develop over time to produce specific business results and how the activities are organized and coordinated
Examples of business processes could be fulfilling an order, developing a new product, creating a marketing plan, hiring an employee
See picture for more examples
Key corporate assets
Intellectual property, core competencies and financial and human assets
In a digital firm, these are managed through digital means
Strategic business objectives achieved through information systems
- Operational excellence –> E.g. the Walmart system which automatically sends a note to the suppliers whenever a customer buys an i
- New products, services and business models –> e.g. The idea of e-books, where you have an e-book reader and then you can read the books online. That’s a new product / service. This is still the same business model as
- Customer and supplier intimacy –> e.g. Amazon knows your previous purchases and can thus give you personal recommendations for you when you open the app or website.
- Improved decision making –> managers can use real time data instead of forecasrs
- Competitive advantage
- Survival –> e.g. ATM machines, which was not really to give a competitive advantage, but as soon as the ATM technology came out, you couldn’t really survive in the industry without also getting ATMs. The same goes for online banking, which is now a vital part of banking.
Business model
How a company produces, delivers and sells a product or service to create wealth
e.g. The idea of e-books, where you have an e-book reader and then you can read the books online. That’s a new product / service. This is still the same business model as normal bookstores, but if you e.g. Offer a subscription, that’ll be a new business model too
Information Technology (IT)
All the hardware and software that a firm needs to use to achieve its business objectives
Computer machines, storage devices, smartphones, software (Windows, Microsoft Office, computer programs)
Information system
A set of interrelated components that collect, process, store and distribute information to support decision making and control in an organization
Provide solutions to organizational problems via information systems that use computers and computer programs to provide information
Data
raw bits of facts which has not yet been sorted into understandable information
streams of raw facts representing events (before they have been arranged and organized into information people can understand and use)
Information
data that has been shaped into a form that is meaningful and useful to people
Functions of an information system (hint: I, P, O, F)
- Input –> captures and collects raw data from within the organization or from its external environment
- Processing –> converts this raw input into a meaningful form
- Output –> Transfers the processed information to the people who will use it
- Feedback –> Output that is returned to appropriate members of the organization to help them evaluate or correct the input stage
See picture
Three dimensions of systems / the interrelated components of an information system
Organization /organizational choices –> the people, the structure, the business processes, the politics and culture
Management / management choices –> make decisions and action plans to solve organizational problems
Technology / technology choices / the information technology infrastructure –> the hardware and software, intranets, extranets, networks
See model
The structure of a company
- Senior management: long range strategic decisions about products and services and ensures financial performance of the firm
- Middle management: carries out the programs and plans of senior management
- Operational management: monitoring daily activities of the business
- Knowledge workers (engineers, scientists, architects), design products/services and create new knowledge for the firm
- Data workers (secretaries, clerks) assist with scheduling and communications at all levels of the firm
- Production / service workers: produce the product or deliver the service
See model
Data management technology
Software used for organizing data on physical storage media
