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Chapter 1 The Information Age in Which You Live Mc. Graw-Hill/Irwin © 2008 The Chapter 1 The Information Age in Which You Live Mc. Graw-Hill/Irwin © 2008 The Mc. Graw-Hill Companies, All Rights Reserved

STUDENT LEARNING OUTCOMES 1. Define MIS and IT and describe their relationship. 2. Validate STUDENT LEARNING OUTCOMES 1. Define MIS and IT and describe their relationship. 2. Validate information as a key resource and describe both personal and organizational dimensions of information. 3. Explain why people are the most important organizational resource, define their information and technology literacy challenges, and discuss their ethical responsibilities. 1 -2

STUDENT LEARNING OUTCOMES 4. Describe the important characteristics of IT as a key organizational STUDENT LEARNING OUTCOMES 4. Describe the important characteristics of IT as a key organizational resource. 5. Define competitive advantage and illustrate the role of IT in supporting competitive advantages and business vision. 6. Discuss the impacts IT can and will have on your life. 1 -3

Disruptive Technologies Disrupt Blockbuster Late Fees • Disruptive technologies – video-on-demand, video rental kiosks, Disruptive Technologies Disrupt Blockbuster Late Fees • Disruptive technologies – video-on-demand, video rental kiosks, etc • Netflix – rent from the Web and keep as long as you want 1 -4

Disruptive Technologies Disrupt Blockbuster Late Fees • Blockbuster solution… – No more late fees Disruptive Technologies Disrupt Blockbuster Late Fees • Blockbuster solution… – No more late fees (will forgo $300 million annually because of this) – Keep for a week – After a week, either buy movie or pay $1. 25 restocking fee 1 -5

Disruptive Technologies Disrupt Blockbuster Late Fees • Class poll… 1. Favorite method of renting Disruptive Technologies Disrupt Blockbuster Late Fees • Class poll… 1. Favorite method of renting videos? 2. Average length (in days) you keep a movie? 3. Watch the movie the day you get it? 1 -6

Disruptive Technologies Disrupt Blockbuster Late Fees • Have you moved away from Blockbuster? To Disruptive Technologies Disrupt Blockbuster Late Fees • Have you moved away from Blockbuster? To what? • Will Blockbuster’s no-late fee model help? Why or why not? • Will real video-on-demand through cable/satellite end “renting” movies? 1 -7

INTRODUCTION • Information age – a time when knowledge is power • Knowledge worker INTRODUCTION • Information age – a time when knowledge is power • Knowledge worker – you; works with and produces information as a product • Outnumber all others by at least 4 -to-1 margin 1 -8

INTRODUCTION • MIS – planning for, developing, managing, and using IT tools to help INTRODUCTION • MIS – planning for, developing, managing, and using IT tools to help people perform their work • IT – computer-based tools that people use to work with information – Traditional computer (notebook, PC, etc) – Bar code scanner – Biometric fingerprint reader 1 -9

INTRODUCTION Online booking revenues are on the rise while non-online booking revenues remain flat INTRODUCTION Online booking revenues are on the rise while non-online booking revenues remain flat 1 -10

INTRODUCTION • There is also a dark side to technology 1 -11 INTRODUCTION • There is also a dark side to technology 1 -11

INTRODUCTION • Three key resources in MIS 1. Information 2. People 3. Technology • INTRODUCTION • Three key resources in MIS 1. Information 2. People 3. Technology • This text is about MIS and information, people, and technology working together to create a competitive advantage 1 -12

INFORMATION AS A KEY RESOURCE • Data – raw facts • Information – data INFORMATION AS A KEY RESOURCE • Data – raw facts • Information – data that has meaning – Weather – when deciding what to wear 1 -13

INFORMATION AS A KEY RESOURCE • Business intelligence – knowledge about competitors, suppliers, your INFORMATION AS A KEY RESOURCE • Business intelligence – knowledge about competitors, suppliers, your own internal operations, etc – Combined forms of information to create real knowledge – Encompasses everything that affects your business – Helps you make strategic business decisions 1 -14

INFORMATION AS A KEY RESOURCE • Perspectives 1. Personal dimensions of information 2. Organizational INFORMATION AS A KEY RESOURCE • Perspectives 1. Personal dimensions of information 2. Organizational dimensions of information 1 -15

Personal Dimensions of Information 1 -16 Personal Dimensions of Information 1 -16

Personal Dimensions of Information • Time – When you need information – Describing the Personal Dimensions of Information • Time – When you need information – Describing the right time period • Location – no matter where you are – Intranet – internal organizational intranet • Form – Usable, understandable, accurate 1 -17

Organizational Dimensions of Information 1 -18 Organizational Dimensions of Information 1 -18

Organizational Dimensions of Information • Information flows • Information granularity • What information describes Organizational Dimensions of Information • Information flows • Information granularity • What information describes 1 -19

Information Flows within an Organization • Upward – current state of organization based on Information Flows within an Organization • Upward – current state of organization based on transactions • Downward – Strategies, goals, directives • Horizontal – between functional units, work teams • Outward/inward – to/from suppliers, customers, distributors, etc 1 -20

Information Granularity • Information granularity – extent of detail within information • Lower org Information Granularity • Information granularity – extent of detail within information • Lower org levels – tremendous detail (fine) • Upper org levels – summarized information (coarse) 1 -21

What Information Describes • Internal – operational aspects of organization • External – environment What Information Describes • Internal – operational aspects of organization • External – environment surrounding organization • Objective – something that is known • Subjective – something that is unknown 1 -22

PEOPLE AS A KEY RESOURCE • • • You Using technology to work with PEOPLE AS A KEY RESOURCE • • • You Using technology to work with information Technology-literate knowledge worker Information-literate knowledge worker Your ethical responsibilities 1 -23

Technology-Literate Knowledge Worker • Technology-literate knowledge worker – knows how and when to apply Technology-Literate Knowledge Worker • Technology-literate knowledge worker – knows how and when to apply technology • This book – Chapters help you with “when” – Appendix A – personal hardware and software technologies – Appendix B – basics of networks 1 -24

Information-Literate Knowledge Worker • Information-literate knowledge worker… – Defines what information is needed – Information-Literate Knowledge Worker • Information-literate knowledge worker… – Defines what information is needed – Knows how and where to obtain information – Understands information – Acts appropriately based on information 1 -25

Your Ethical Responsibilities • Ethics – principles and standards that guide behavior toward other Your Ethical Responsibilities • Ethics – principles and standards that guide behavior toward other people • Ethics and laws are different • Laws – require/prohibit action • Ethics – matter of personal interpretation 1 -26

Your Ethical Responsibilities You always want to be here 1 -27 Your Ethical Responsibilities You always want to be here 1 -27

IT AS A KEY RESOURCE • Information technology (IT) - computer-based tools that people IT AS A KEY RESOURCE • Information technology (IT) - computer-based tools that people use to work with information • Two categories of technology – Hardware – Software • Ubiquitous computing 1 -28

Key Technology Categories 1 -29 Key Technology Categories 1 -29

Hardware • Hardware – physical devices of a computer 1. 2. 3. 4. 5. Hardware • Hardware – physical devices of a computer 1. 2. 3. 4. 5. 6. Input devices Output devices Storage devices CPU & RAM Telecommunications devices Connecting devices 1 -30

Hardware • Input device – enter information and commands • Output device – receive Hardware • Input device – enter information and commands • Output device – receive the results • Storage device – stores information • CPU – interprets and executes software instructions • RAM – temporarily holds information and software 1 -31

Hardware • Telecommunications device – sends and receives information in a network • Connecting Hardware • Telecommunications device – sends and receives information in a network • Connecting device – connects pieces of hardware (e. g. , cable, port) • Appendix A covers hardware in detail 1 -32

Software • Application software – solves specific problems, performs specific tasks • System software Software • Application software – solves specific problems, performs specific tasks • System software – handles technology management tasks and coordinates all hardware 1 -33

Software • Two types of system software 1. Operating system software – controls application Software • Two types of system software 1. Operating system software – controls application software, manages hardware devices 2. Utility software – additional functionality to your operating system (e. g. , anti-virus software) • Appendix A covers more on software 1 -34

Ubiquitous Computing • Ubiquitous computing – concept; technology support anytime, anywhere, with access to Ubiquitous Computing • Ubiquitous computing – concept; technology support anytime, anywhere, with access to any needed information 1. 2. 3. Decentralized computing Shared information Mobile computing 1 -35

Ubiquitous Computing 1 -36 Ubiquitous Computing 1 -36

Ubiquitous Computing • Decentralized computing – Distributes computing power within the organization to knowledge Ubiquitous Computing • Decentralized computing – Distributes computing power within the organization to knowledge workers • Shared information – allows anyone access to needed information 1 -37

Ubiquitous Computing • Mobile computing – wireless technology to connect to needed resources and Ubiquitous Computing • Mobile computing – wireless technology to connect to needed resources and information • M-commerce – electronic commerce conducted wirelessly 1 -38

INFORMATION TECHNOLOGY BUSINESS VISION • IT use must support business vision • IT strategy INFORMATION TECHNOLOGY BUSINESS VISION • IT use must support business vision • IT strategy must be integrated with business vision • Competitive advantage – providing product/service that customers value more than the competition 1 -39

INFORMATION TECHNOLOGY BUSINESS VISION • • • Top line versus bottom line Database support INFORMATION TECHNOLOGY BUSINESS VISION • • • Top line versus bottom line Database support Decision-making support Business initiative support Run, grow, transform 1 -40

Top Line Versus Bottom Line 1 -41 Top Line Versus Bottom Line 1 -41

Top Line Versus Bottom Line • Top line – competitive advantage focus to increase Top Line Versus Bottom Line • Top line – competitive advantage focus to increase revenue • Bottom line – competitive advantage focus to decrease costs • IT can support both top-line and bottom-line initiatives 1 -42

Top Line Versus Bottom Line • Customer self-service system – technology in hands of Top Line Versus Bottom Line • Customer self-service system – technology in hands of customers to enable them to process their own transactions – ATMs – attract new customers with free use (top line) – ATMs – reduce costs of tellers (bottom line) • Transaction processing system (TPS) – system that processes transactions 1 -43

Database Support 1 -44 Database Support 1 -44

Database Support • Database – stores tremendous detail on every transaction/event • DBMS – Database Support • Database – stores tremendous detail on every transaction/event • DBMS – software bridge between information/software system and information/you 1 -45

Database Support • You need knowledge of databases and DBMSs for career • Chapter Database Support • You need knowledge of databases and DBMSs for career • Chapter 3 – database concepts 1 -46

Decision-Making Support • Online transaction processing (OLTP) – gathering, processing, and updating information for Decision-Making Support • Online transaction processing (OLTP) – gathering, processing, and updating information for a transaction • Online analytical processing (OLAP) – manipulating information to support decision making (focus of Chapters 3 & 4) – Executive information system – Collaboration system – Artificial intelligence 1 -47

Decision-Making Support • Executive information system (EIS) – supports “drilling down” in information to Decision-Making Support • Executive information system (EIS) – supports “drilling down” in information to find problems/opportunities 1 -48

Decision-Making Support • Collaboration system – improves team performance by supporting sharing and flow Decision-Making Support • Collaboration system – improves team performance by supporting sharing and flow of information • Artificial intelligence (AI) – science of imitating human thinking and behavior – Genetic algorithm – See Industry Perspective on p. 33 1 -49

Business Initiative Support • IT use in business is all about enabling initiatives • Business Initiative Support • IT use in business is all about enabling initiatives • This is the focus of Chapter 2 • Two examples 1. Supply chain management 2. Electronic data interchange 1 -50

Business Initiative Support • Supply chain management (SCM) – tracks inventory and information • Business Initiative Support • Supply chain management (SCM) – tracks inventory and information • SCM system – IT that supports SCM business initiative 1 -51

Business Initiative Support • SCM systems support EDI • Electronic data interchange (EDI) – Business Initiative Support • SCM systems support EDI • Electronic data interchange (EDI) – computer -to-computer transfer of information without human intervention – Standard documents such as purchase orders – Bottom-line initiative to reduce costs of ordering, shipping, paying, etc 1 -52

Run, Grow, Transform • Framework for percentage allocation of IT dollars toward… – Run Run, Grow, Transform • Framework for percentage allocation of IT dollars toward… – Run – optimizing activity execution (bottom line) – Grow – increasing market reach, product offerings, etc (top line) – Transform – innovating business processes • Application of this framework in Chapter 2 1 -53

IT IN YOUR LIFE • IT is pervasive • You need IT knowledge to IT IN YOUR LIFE • IT is pervasive • You need IT knowledge to succeed (your career) • You need IT knowledge to protect yourself as well (ethics, security, & privacy) 1 -54

IT in Your Career • Learn how to use IT to… – Share information IT in Your Career • Learn how to use IT to… – Share information – Work wirelessly – Support your decision-making efforts – Increase personal productivity 1 -55

Ethics, Security, & Privacy • All very important • Security and privacy – protect Ethics, Security, & Privacy • All very important • Security and privacy – protect yourself from… – Spyware – Identity theft – Focus of Chapter 8 1 -56

Ethics, Security, & Privacy • Spyware – bad software that collects information about you Ethics, Security, & Privacy • Spyware – bad software that collects information about you and your computer and sends it to someone else – 11. 5 million incidents in 2004 • Identity theft – forging someone’s identity for purpose of fraud – $100 billion lost in U. S in 2003 1 -57

Ethics, Security, & Privacy • Keep anti-virus software up to date • Use only Ethics, Security, & Privacy • Keep anti-virus software up to date • Use only secure Web sites for financial transactions • Never give out personal information on Web • Change your password frequently • Never assume high ethical standards of other people 1 -58

CAN YOU… 1. Define MIS and IT and describe their relationship. 2. Validate information CAN YOU… 1. Define MIS and IT and describe their relationship. 2. Validate information as a key resource and describe both personal and organizational dimensions of information. 3. Explain why people are the most important organizational resource, define their information and technology literacy challenges, and discuss their ethical responsibilities. 1 -59

CAN YOU… 4. Describe the important characteristics of IT as a key organizational resource. CAN YOU… 4. Describe the important characteristics of IT as a key organizational resource. 5. Define competitive advantage and illustrate the role of IT in supporting competitive advantages and business vision. 6. Discuss the impacts IT can and will have on your life. 1 -60