Chapter 1:

Introduction to Information
Systems
 Information Concepts
Data: raw facts, such as employee number,
number of hours worked in a week, inventory
part numbers etc.
Alphanumeric data, Image data, Audio data,
Video data
Information: collection of facts organized so that
they have additional value beyond the value of
facts themselves
Process: set of logically related tasks performed
to achieve a defined outcome, or simply turning
data into information
 Information Concepts

However, certain rules and regulations can be set

up to organize data into useful and valuable
information
Knowledge: is the awareness and
understanding of a set of information and the
ways that information can be made useful to
support a specific task or reach a decision
 Information Concepts
Characteristics of valuable information
 Accessible
 Accurate
 Complete
 Economical
 Flexible
 Relevant
 Reliable
 Secure
 Simple
 Timely
 Verifiable
The value of information is directly linked to how it helps decision
makers achieve their organization’s goals
 System Concepts

System: is a set of elements or components

that interact to accomplish goals
The relationships among the elements
determine how the system works
 Information System(IS)
What is an Information System?

 Information system is a group of components that

interact to produce information.
 Five Component framework: computer hardware,
software, data, procedures, and people
 information system as a synonym for computer-
based information system
Components of Information Systems:

The IS components include people resources (end users and IS

specialists), equipment (hardware and software resources),
data resources (data and knowledge bases), and network
resources (communications media and network support).

These resources carry out the input, processing, output,

storage, and control activities, and convert the data resources
into information products.

It provides an outline that focuses on the five basic resources

of information systems namely - people, hardware, software,
data, and networks.
 People
People are the indispensable components for the
operation of information systems. These resources
include the end users and the IS specialists.

End users are people who use information

products for a variety of needs. They are also
called the users or the clients. The end users of an
IS can include customers, managers, engineers,
accountants, salespersons, or clerks.
 Equipment/ Hardware and SW
Equipment refers to the hardware and software resources.
Hardware resources: Hardware resources include all the physical
devices and materials that are used in recording and processing the
information.
 These resources include all the tangible objects or machines on
which the data is recorded and is processed like computers and data
media.
 The computer systems and the peripherals constitute the hardware
resources in a computer-based IS.
Software resources: The software resources of an IS constitute all the
sets of instructions that are required for processing the data into
information. These resources include programs and procedures. These
programs and procedures accept input in the form of data resources,
process them into information, and disseminate this information to the
end users.
 Data
 Data are raw facts and figures that are unorganized and
later processed to generate information. It is the most
valuable and vital among resources in any organization,
big or small. Like any resource, data should also be
effectively managed in order to benefit the end users of
the organization.
 Data resources can take numerous forms. They can be
in the form of alphanumeric data (e.g. alphabets,
numbers, and other characters), text data (e.g.
sentences, paragraphs), image data (e.g. graphics,
figures), and audio data (e.g. human voice, sounds).
 Network
 Network resources refer to the telecommunication networks
like intranets, extranets, and the Internet.
 These resources facilitate the flow of communication in the
organization and are therefore essential for computer-based
information systems.
 The telecommunication network components in the
organization comprise computer systems, communication
processors like modems and internetwork processors, and
other devices.
 All these components should be interconnected by a
medium of communication and should be controlled by the
communication software such as network operating systems
and Internet browser packages.
 How Does IS Differ from IT?
 Information Technology (IT): It refers to the methods,
inventions, standards, and products. As the term implies, IT
refers to ram technology, and it concerns only the hardware,
software, and data components of an information system and
how these are connected together.

 Information System (IS) is a group of components that interact

to produce information. The components of information system
are; computer hardware, software, data, procedure, and people.

 So the real difference between Information System (IS) and

Information Technology (IT) is that IS includes the component
called 'people' in its equation and IT does not.

 Now, that being said, we can therefore say that, IT is included

in IS.
 How Do Successful Business
Professionals Use IS?
Today, every business professional uses numerous
information systems. Most people are able to use
email, access web pages, use word processors and
spreadsheets, create presentations with
PowerPoint, talk on a cell phone, and use instant
messaging.
The line between business and technology is
rapidly blurring. Business professionals need to
consider IT and IS when they think about the
problems and opportunities that confront a
department or organization.
 Why Firms Use IS

To achieve 6 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
 Why Firms Use IS
1. Operational Excellence
Achieving higher levels of efficiency and productivity
in business operations, plus changes in management
behaviour
Example: Wal-Mart’s Retail Link system links
suppliers to stores for in-time replacements

2. New Products/ Services/ Business Model

Business model: describes how company produces,
delivers, and sells product or service to create wealth
Information systems and technology a major enabling
tool for new products, services, business models
E.g. Apple’s iPod, iTunes online music business
 Why Firms Use IS
3. Customer and Supplier Intimacy
 Serving customers well leads to customers returning, which
raises revenues and profits
 Intimacy with suppliers allows them to provide vital inputs,
which lowers costs
E.g. JCPenney’s information system which links sales records to
contract manufacturer
4. Improved decision making
 Managers need right information at right time
 IS provide real-time data for making decisions
 E.g. Verizon’s Web-based digital dashboard to provide managers
with real-time data on customer complaints, network
performance, line outages, etc.
 Results in restoration and repairing fast and effective
 Why Firms Use IS

5. Competitive Advantage
Achieve higher sales and profit through using IS by:
Doing things better
Charging less for superior products
real time responding
Using the internet is competitive advantage
6. Survival
Information technologies are necessity of doing
business
Industry-level changes, e.g. Citibank’s introduction of ATMs
 What MIS?

MIS, or management information system. MIS is

the development and use of information system
that help businesses achieve their goals and
objectives.

Three key element:

 i. Development and use,
 ii. information system to get decisive information,
 Iii. business goals and objective