Why do information systems matter

Second, and closely related to my first finding, these entrepreneurs tend to concentrate on technical characteristics. Too often, this myopia means that they fail to anticipate the ways in which such systems can be used to increase the effectiveness of individuals in organizations.

Finally, highly innovative systems—the very ones management should find most useful—run a high risk of never being implemented, especially when the impetus for change comes from a source other than the potential user. Quite simply, my purpose in this article is to discuss, without getting into the technology involved, the high potential of a variety of decision support systems, the challenges and risks they pose to managers and implementers, and a wide range of strategies to meet these challenges and risks.

While there are many ways to categorize computer systems, a practical one is to compare them in terms of what the user does with them:. Decision Support Systems. Although decision-oriented reporting systems often grow out of standard EDP systems, I will concentrate on seven distinct types, briefly describing one example of each type.

Incidently, it is interesting to note that external consultants developed the systems cited in my second, fifth, and seventh examples, while those of the first, third, and sixth were the creations of people acting as internal entrepreneurs through staff roles; only the fourth system was developed on direct assignment by the user.

This same pattern of initiation of innovative systems by people other than the users was present in many of the 56 systems. In order to help production foremen improve the percentage yield on a newly developed 50—stage process for manufacturing micro-circuits, the management of one company has installed an on-line, shop floor information system. Operators submit daily piecework reports, which include yield, release date, identification of the person who does the work, and so on.

The foremen then juggle this information to obtain productivity data by operation, operator, machine, and lot. Thus they are able to use the system in a number of ways. They can monitor work flow, pinpoint yield problems, and settle day-to-day questions such as who worked on which lot when, and which operators are ahead of or behind schedule, or below standards.

The foremen have 13 standard commands by which they can retrieve the data stored in the system and display them on a cathode ray tube terminal. The commands permit them to tailor reports to their needs. Before advising clients or making authorized trading decisions, the portfolio managers at a bank I studied use an on-line system to analyze individual portfolios.

The managers can bypass time-consuming manual methods and obtain up-to-date and clearly organized portfolio information in either graphic or tabular form. Depending on the situation, a manager can inspect both individual portfolios and groups of portfolios from different viewpoints—for example, rank them in different ways, obtain breakdowns by industry or risk level, and so on.

Greater flexibility was also the reason that two consumer products companies and one manufacturing company I looked at developed sales information systems which are quite similar. In each case, information extracted from the EDP systems is now maintained separately in order to have it handy and, in two instances, to be able to analyze it in conjunction with externally purchased proprietary data bases and models.

Basically, each system is a vehicle by which a staff man or group tries to help decision makers. Their modus operandi is incremental: identify a problem; bring the current system and existing expertise to bear on it; develop a solution in the form of an analysis or additional system module; and incorporate the results into an expanded version of the system.

Evaluating decisions using an accounting model—a source-and-application-of-funds budget. To expedite operational decision making and financial planning over a two-year horizon, an insurance company is using an on-line, source-and-application-of-funds budget system.

Inputs are projections of future business levels in various lines of insurance and investment areas, plus assumptions concerning important numbers such as future money-market rates. The output is a projected overall cash flow by month. An investment committee uses the model to allocate funds across investment areas and to minimize the amount of cash left idle in banks.

The committee compares projected cash flows based on different allocation decisions; the decisions that it actually adopts are those that produce adequate projected cash flows and that are acceptable to the various groups in the company.

Actually, the system is an accounting definition of the company. There is no question about the accuracy of the relationships in the model, so the only way projected results can be in error is if estimates of business activity levels or money market rates are incorrect.

In order to provide a more rational basis for repetitive marketing decisions, a consumer products company uses a model that relates levels of advertising, promotions, and pricing to levels of sales for a particular brand. The model was validated by tracking its accuracy in predicting sales based on the competitive actions that were taken. Unlike the accounting model I just mentioned, this is a simulation model in which some of the most important relationships are estimates at best.

For instance there simply is no rule by which it is possible to predict sales with certainty based on advertising levels. In fact, this was the heart of the issue in developing the model. Another consumer products company, faced with short-run supply problems for many of its raw materials, has developed an optimization model to solve the mathematical puzzle of choosing and balancing among various product recipes.

The inputs to the model include a series of different recipes for many products, short-run supply levels for raw materials, and production requirements for finished products. Backdoor Website. Website Safety Check. Share this article:. Community About Comodo. Call now! For a live demonstration ext There is no alternative for the right information at the required time in the world of business where every industry revolves round the "Internet of Things" This raised the need to innovate and develop the systems that can be implemented to make information accurate, that can be quickly accessed on demand.

Be Sociable, Share! Add new comment. Your name. The business processes include the phone, texting, and online procedures—how and when to cast votes, and rules limiting the number of votes from each household. In November , ABC had to defend the legitimacy of its business processes when detractors claimed that Bristol Palin, daughter of political candidate, Sarah Palin, received an inflated vote tally from Tea Party supporters.

Some of these supporters bragged on blogs about how they had circumvented the ABC business processes to record multiple votes for Bristol. ABC claims that it has systems in place to spot and discount suspicious voting activity. They have publicly revealed some, but not all, of these fraud detection systems.

The three parts of the information systems triangle must interact in concert to realize business objectives. The job of the IS professional is to ensure that a balance is maintained and enhanced for the good of all the actors and the business as a whole. Information systems professionals work with others to design and customize the systems that you interact with everyday. When you register at a hospital, the information goes into an information system designed to support administrative reporting and insurance processing.

When you buy from Amazon. Unfortunately, that someone is not always the consumer. When was the last time that you had a good registration experience at a hospital? That system probably was not designed with you in mind—but rather designed to support backend reporting for the hospital administration and by proxy for the government and insurance companies.

So the administrators are happy, but not the customers. They are betting that you will not choose your hospital based on how difficult it was to register.

Amazon practices user centered design Designing websites and applications to meet the needs of the user. While this may seem to be common sense, in practice it does not often happen—especially in internal corporate settings. How user centered are the systems at your college or university? However, the clever folks at Amazon also have tremendous backend reporting. So it is possible to design systems that please customers and administrators simultaneously—but it takes a bit more effort.

What would hospital systems look like if they were designed to Amazon standards? Imagine 1-click appointments, 1-click payments, shielding the client from the insurance companies. How about an integrated patient record of all past procedures? The world will continue to gravitate toward Amazon style systems. In the end it is good business to make everyone happy—employees, customers, and administrators. It is also the right thing to do. Think back to the hospital.

In a competitive market, maybe you would choose the better customer experience. A hospital worker might choose to work for the hospital with the more user friendly patient information system. No one likes to be yelled at by unhappy customers. You have to design a user interface UI anyway—why not make it a good one? Consider the tremendous success of Apple Computer. One of the main advantages that Apple has over its rivals is that it carefully analyzes how people best interact with technology, develops requirements based on that analysis and then designs elegant computers, the iPhone, iPad, iTunes, and so forth based on those requirements.

Google Health, pictured here, has created a user centered patient record—and for free! It will be interesting to see if hospitals adopt it. Marketing, accounting, finance, manufacturing — there are many different professional goals and types of work in the business world. There are also many different industries where this work can be performed — manufacturing, retail, banking, healthcare.

No matter what your career goal is or what industry interests you, your success and the success of the business rely on your ability to recognize opportunities where information systems can be used to improve performance.

In most lines of work, you will need to store information in and retrieve information from databases. You will have to create persuasive and professional reports and presentations to convince others that your ideas make sense. Using Microsoft Excel and other tools, you will analyze data to find patterns and trends to aid decision-making. You will manage your relationships with contacts and clients using customer relationship management systems. Retailers rely on past purchase data to develop sales forecasts and predict purchase behavior.

Most businesses utilize collaboration technologies to bring together employees from all over the world to solve problems. Your ability to recognize opportunities to use information technology to create business value is central to both your success and that of your firm. A career in information systems is full of action, problem-solving, and teamwork. It is the goal of information systems professionals to bridge the knowledge gap between business users and technologists, and thus IS professionals must be fluent in both worlds.

Work in the field of information systems is exciting, fun, and fast-paced. There is always a new team to work with and new technology to learn about, and projects move quickly leaving openings for new endeavors. In a recent report published in The Wall Street Journal, information systems professionals were tied for the highest percentage of college graduates that were satisfied with their career path.

When preparing to become an IS professional, students focus on learning about the types of systems that exist, what they offer to businesses, best practices for implementation, and the advantages and disadvantages of each. Students also focus on how to work with business users and discover what their system needs are and how they can best be served by information systems.

Information systems professionals focus on solving problems in businesses through the use of information systems. When students start their careers, they frequently work on teams that connect businesspersons with the appropriate system solution for their situation. Usually the organizations they work for adopt a set of best practices to create consistency across project teams. Through the use of these best practices, IS professionals determine what options are available, consider the pros and cons of each, design a customized solution to match the specific business, and develop a plan on how to best implement the information system, including rollout phases and training.

Thank you! Published by Sheryl Alexander Modified over 6 years ago. Information systems have five key elements: hardware, software, data, people, and the telecommunications networks that people build and use to collect, create, and distribute data. Discuss with your neighbor how information systems are used in your school. While companies have begun to spend money on IS projects, they are looking for a good return on investments.

As businesses increased their use of IS, they became more productive with fewer employees. A new economy More colleges and universities A knowledge society A wired economy A digital economy.

A new economy More colleges and universities A knowledge society A wired economy A digital economy Peter Drucker predicted this rise in the importance of IT and information, explaining that education would become a cornerstone for the knowledge society.

Castell wrote about the network society, Wired magazine called it the new economy, and others have termed it the digital society, the network era, and the Internet era. Data has meaning, while information has none. You format data, but information is not formatted. You transform data into information. Information is raw material, while data is stored on computer systems.