Questions1) Explain the differences and focus of MIS systems and KMS systems. Research online, present a specific company that most benefits from each type of system, analyse how each company uses the

1 Introduction to Information Systems LEARNING OBJECTIVES >>> 1. Begin the process of becoming an informed user of your organization's information systems. 2. Define the terms data , information , and knowledge , and give examples of each. 3. Define the terms information technology, information system, computer -based information system, and application. 4. Identify three ways in which you depend on information technology in your daily life. 5. Discuss three ways in which information technology can impact managers and three ways in which it can impact nonmanagerial workers. 6. List three positive and three negative societal effects of the increased use of information technology. OPENING CASE > E-Mealz Jane DeLaney grew up in a home where family meals around the table were the norm. She wanted the same for her family, but she found it very difficult due to everyone's busy schedules. She would go from one week of a somewhat organized meal plan to another week of shee r chaos. In 2003, Jane decided it was time to do something about the problem. She created a meal -planning service, called E -Mealz ( www.E - Mealz.com ), that she could both use herself and offer to other families. How does E -Mealz work? Essentially, Jane and a few employees create a weekly meal plan for different - sized families. They then draw up a grocery list with prices from various grocery stores. Customers pay for the service — in Apr il 2011, the cost was only $1.85 a week — and they receive their grocery list at the beginning of the week. Jane needed to utilize information technology to enable her great idea to work. The E -Mealz Web site promotes her products and convinces customers to sign up for her service. If you visit her site, you will find that she also uses Twitter and Facebook to promote her product and to create a community of customers. Visitors can also submit their own recipes to be included in the system. Members can sign up for newsletters, and they can manage their accounts to determine which particular plan they will join. The Web site offers plans for couples and families, and it provides information about a host of nutritional needs, all of which is updated weekly. Alt hough the tools that Jane uses are not complicated, she could not have transformed her dream into a reality without them. When Jane DeLaney started E -Mealz, her objective was not to create a huge meal -planning service. Rather, her goal was simply to provide a way for families to spend time together, save money, and enjoy delicious meals. Since its inception, E -Mealz has been acclaimed for improving family meals while helping families to control their budget. Bloggers testify that they are able to s hop more quickly and spend less money while feeling confident that they have purchased all the ingredients they will need for the week. Jane has successfully utilized technology to accomplish her goal of helping families spend time together, much as her fa mily did when she was growing up. Sources: Compiled from A. Caldwell, “ E-Mealz.com —Meal Planning Resource Review ,” Blissfully Domestic , February 17, 2011; http://E -Mealz.com ; http://maketimeforfamily.org ; www. daveramsey.com/recommends/dave - recommends ; accessed July 27, 2011. Questions 1. Provide two examples of how Jane uses information technology to provide her service. 2. Provide two additional examples of how Jane might use information technology to improve her service. Be specific. RUBY'S CLUB Ruby's Club has recently closed for renovation. While it is closed, its two owners, Ruben and Lisa, have decided that this is a perfect time for them to reorganize, restructure, and reconsider the way they operate their business. They started this club in 2000 just after they graduated from college with their degree in business administration, and they have experienced much success as a result of their hard work. >>>Informatio n technology was not even taught when they were in college, so they have not used much (if any) technology in their club. While they are considering using IT as they restructure, they are not sure how much and in what ways they should pursue its use. To he lp them in this area, they have hired you as an IT intern to help answer many of their questions about technology. They have teamed up with your IT professor and designed questions to go along with the topics you will be learning in class. This internship is designed to accomplish two things. First, it will give Ruben and Lisa the benefit of learning about information technology that was not taught when they were in school. Second, it will give you the benefit of applying the textbook knowledge you learn to the real world. As this chapter states, your generation is considered Homo conexus . Your constant connectivity has to play a role in the restructuring of Ruby's Club. It is your job to help Ruben and Lisa understand exactly how this will look! As you read through the chapter, you will address discussion questions to help you (and Ruben and Lisa) see the impact of information systems on Ruby's Club. Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. INTRODUCTION Before you proceed, it is important to define information technology and information systems. Information technology (IT) relates to any computer -based tool that people use to work with information and to support the information and information -processing needs of an organization. An information system (IS) collects, processes, stores, analyzes, and disseminates information for a specific purpose. Informati on technology (IT) has far -reaching effects on us as individuals, on organizations, and on our planet. Although this book is largely devoted to the many ways in which IT has transformed modern organizations, you will also learn about the significant impact s of IT on individuals and societies, the global economy, and our physical environment. In addition, IT is making our world smaller, enabling more and more people to communicate, collaborate, and compete, thereby leveling the digital playing field. When yo u graduate, you either will start your own business or you will go to work for an organization, whether it is public sector, private sector, for profit, or not for profit. Your organization will have to survive and compete in an environment that has been r adically changed by information technology. This environment is global, massively interconnected, intensely competitive, 24/7/365, real -time, rapidly changing, and information intensive. To compete successfully, your organization must use IT effectively. As the E -Mealz example illustrates, small business owners do not need to be experts in technology to be successful. The core competency of Jane's business is not technology. Rather, it is the service of saving time and money. However, she has effectively em ployed social media and available Internet -related tools to create a successful business. As you read this chapter and this book, keep in mind that the information technologies you will learn about are important to businesses of all sizes. No matter what a rea of business you major in, what industry you work for, or the size of your company, you will benefit from learning about IT. Who knows? Maybe you will have a great idea and use the tools you learn about in this class to make your dream a reality much th e way Jane DeLaney has! The modern environment is not only intensely competitive for your organization, but for you as well. You must compete with human talent from around the world. Therefore, you will also have to make effective use of IT. Accordingly, this chapter begins with a discussion of why you should become knowledgeable about IT. It also distinguishes among data, information, and knowledge, and it differentiates computer -based information systems from application programs. Finally, it considers t he impacts of information systems on organizations and on society in general. Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. 1.1 Why Should I Study Information Systems? You are the most connected generation in history. You have grown up online. You are, quite literally, never out of touch. You use more information technologies (in the form of digital devices) for more tasks, and are bombarded with more information, than any generation in history. The MIT Technology Revie w refers to you as Homo conexus . Information technologies are so deeply embedded in your life that your daily routines would be almost unrecognizable to a college student just 20 years ago. Essentially, you are practicing continuous computing, where you are surrounded with a movable information network. Your network is created by constant cooperation between the digital devices you carry (for example, laptops, media players, and smart phones) ; the wireline and wireless networks that you access as you move about; and Web -based tools for finding information and communicating and collaborating with other people. Your network enables you to pull information about virtually anything from anywhere, at any time, and to push your own ideas back to the Web, from wherever you are, via a mobile device. Think of everything you do online, often with your phone: register for classes; take classes (and not just at your university); access class syllabi, infor mation, PowerPoints, and lectures; research class papers and presentations; conduct banking; pay your bills; research, shop, and buy products from companies or other people; sell your “stuff”; search for, and apply for, jobs; make your travel reservations (hotel, airline, rental car); have your own blog and post your own podcasts and videocasts to it; have your own page on Facebook; make and upload videos to YouTube; take, edit, and print your own digital photographs; “burn” your own custom -music CDs and DV Ds; use RSS feeds to create your personal electronic newspaper; text and tweet your friends and family throughout your day; and many other activities. ( Note: If any of these terms are unfamiliar to you, do not worry. You will learn about everything mention ed here in detail later in this book.) The Informed User — You! So, the question is, Why should you learn about information systems (IS) and information technologies (IT)? After all, you can comfortably use a computer (or other electronic device) to perform many activities, you have been surfing the Web for years, and you feel confident that you can manage any IT application that your organization's MIS department installs. The answer lies in your becoming an informed user ; that is, a person knowledgeable about information systems and information technology. There are several reasons why you should be an informed user. Students today are connected by many devic es—almost all are wireless. (Source: Media Bakery) In general, informed users tend to get more value from whatever technologies they use. You will enjoy many benefits from being an informed user of IT. First, you will benefit more from your organization's IT applications because you will understand what is “behind” those applications (see Figure 1.1 ). That is, what you see on your computer screen is brought to you by your MIS department operating “behind” your screen. Second, you will be in a position to enhance the quality of your organization's IT applications with your input. Third, even as a new graduate, you will quickly be in a position to recommend — and perhaps help select — the IT applications that your organization will use. Fourth, being an informed user will enable you to keep abreast of both new information te chnologies and rapid developments in existing technologies. Figure 1.1 IT skills open many doors because IT is so widely used. What do you think is this woman's job? (Source: © Slawomir Fajer/iStockphoto) Remaining “on top of things” will help you to anticipate the impacts that “new and improved” technologies will have on your organization and to make recommendations on the adoption and use of these technologies. Finally, you will understand how IT can be used to improve your organization's per formance and teamwork as well as your own productivity. Managing the IS function within an organization is no longer the exclusive responsibility of the IS department. Rather, users now play key roles in every step of this process. Our overall objective in this book is for you to be able to immediately contribute to managing the IS function in your organization from your user's perspective. In short, we want to help you become a very informed user! In addition, if you wish to become an entrepreneur, then be ing an informed user will help you use IT when you start your own business. “IT's About Business 1.1 ” illustrates how one couple uses IT to run their own multinational businesses from their home. IT Offers Career Opportunities Because information technology is vital to the operation of modern businesses, it offers many employment opportunities. The demand for traditional IT staff — programmers, business analysts, systems analysts, and designers — is substantial. In addition, many well -paid jobs exist in areas such as the Internet and electronic commerce (e -commerce), mobile commerce, n etwork security, telecommunications, and multimedia design. It's not just students. Today's professional must be able to use computing technologies to do their job. (Source: Howard Kingsnorth/The Image Bank/Getty Images, Inc.) The information systems (IS) field includes the people in organizations who design and build information systems, the people who use those systems, and the people responsible for managing those systems. At the top of the list is the chief information officer (CIO). The CI O is the executive who is in charge of the IS function. In most modern organizations, the CIO works with the chief executive officer (CEO), the chief financial officer (CFO), and other senior executives.

Therefore, he or she actively participates in the or ganization's strategic planning process. In today's digital environment, the IS function has become increasingly important and strategic within organizations. As a result, although the majority of CIOs still rise from the IS department, a growing number ar e coming up through the ranks in the business units (e.g., marketing, finance, etc.). So, regardless of your college major, you could become the CIO of your organization one day. This is another reason to be an informed user of information systems! IT's ABOUT BUSINESS 1.1 Build Your Own Multinational Company Global outsourcing is no longer used only by big corporations. Increasingly, small businesses are finding it easier to farm out software development, accounting, support services, and design work to other countries than to perform these services themselves . Improved software, search engines, and new features are boosting the online services industry. Companies in this industry include Elance ( www.elance.com ), Guru (www.guru.com ), Brickwork India ( www.b2kcorp.com ), and vWorker ( ww w.vworker.com ). As examples of added features, Guru has launched a system to avoid disputes over payments by allowing buyers put funds in escrow until the work is received. Meanwhile, Elance has developed software to track work in progress and to handle bi lling, payments, and tax records. Take Randy and Nicola Wilburn, for example. Their house is the headquarters of a multinational company.

The Wilburns operate real estate, consulting, design, and baby food enterprises out of their home. They accomplish the se tasks by making effective use of outsourcing. Professionals from around the world are at their service. For example, for $300 an Indian artist designed Nicola's letterhead as well as the logo of an infant peering over the words “Baby Fresh Organic Baby Foods.” A London -based freelancer wrote promotional materials. Randy has hired “virtual assistants” in Jerusalem to transcribe voice mail, update his Web site, and design PowerPoint graphics. Retired brokers in Virginia and Michigan handle real estate pape rwork. The Wilburns began buying graphic designs through Elance in 2000. Today, remote help has enabled Randy to shift his emphasis within the changing economy. His real estate business has slowed in response to the housing crisis, so he spends more time advising nonprofit organizations across the United States on how to help homeowners avoid foreclosure. Virtual assistants handle routine correspondence and put together business materials while he travels, all for less than $10,000 per year. Nicola decided to work from home after she had their second child. She now far ms out design work to freelancers and is starting to sell organic baby food she cooks herself. She is setting up a Web site for that business and has offered $500 for the design work. Of the 20 bidders who responded via Elance, 18 were from outside the Uni ted States. The couple employs two primary offshore vendors. One is GlobeTask ( www.globetask.com ), a Jerusalem - based outsourcing firm that employs graphic artists, Web designers, writers, and virtual assistants in Israel, India, and the United States. The company generally charges $8 per hour. The other vendor is Webgrity (www.webgrity.com ), headquartered in Kolkata, India. For $125, Webgrity designed a logo for Randy's real estate business that he maintains would have cost as much as $,1000 in the United States. Interestingly, the Wilburns employ representatives of a growing lifestyle trend, the digital nomads. In fact, the Wilburns are digital nomads as well. A digital nomad is someone who uses information technologies such as smart phones, wireless Internet access, and Web -based applicati ons to work remotely — from home, a coffee shop, an Internet café, and similar locations. Digital nomads have location independence, and they frequently work as freelance writers, editors, photographers, affiliate marketers, Web designers, developers, graphi c designers, and other types of knowledge workers. Questions 1. Identify and evaluate the advantages and disadvantages of outsourcing work overseas. 2. Can anyone do what Randy and Nicola Wilburn are doing? Or, does their strategy require special qualifications or knowledge? Support your answer. 3. Explain how global outsourcing can affect people who are starting their own business. (Hint: Consider capital outlay, labor costs, IT infrastructure costs, and so on.) 4. Would you like to be a di gital nomad? Why or why not? Be specific. Sources: Compiled from B. Russell, “ Ever Heard of a Digital Nomad ?” www.brentonrussell.com , June 10, 2010; M. Elgan, “ Is Digital Nomad Living Going Mainstream? ” Computerworld , August 1, 2009; M. Rosenwald, “ Digital Nomads Choose Their Tribes ,” The Washington Post , July 26, 2009; M. Elgan, “ Recession Woes? Why Not Become a Digital Nomad ,” Computerworld , March 23, 2009; P. Eng ardio, “ Mom -and -Pop Multinationals ,” BusinessWeek , July 14 and 21, 2008; T. Ferriss, The 4 -Hour Workweek: Escape 9 -5, Live Anywhere and Join the New Rich , 2007, Crown Publishing Group; B. McDermott, “ Ahoy the Micro -Multinational ,” Forbes , September 14, 200 7; S. Harris, “ Rise of the Micro Giants ,” San Jose Mercury News , July 14, 2007; A. Campbell, “ The Trend of the Micro -Multinationals ,” Small Business Trends , February 20, 2007; M. Copeland, “ The Mighty Micro -Multinational ,” Business 2.0 Magazine , July 28, 2 006; H. Varian, “ Technology Levels the Business Playing Field ,” The New York Times , August 25, 2005. Table 1.1 provides a list of IT jobs along with a description of each one. For further details about careers in IT, see www.computerworld.com/careertopics/careers and www.monster.com . TABLE 1.1 Information Technology Jobs Position Job Description Chief information officer Highest -ranking IS manager; is responsible for all strategic planning in the organization IS director Manages all systems throughout the organization and day -to-day operations of the entire IS organization Information center manager Manages IS services such as help desks, hot lines, training, and consulting Applications development manager Coordinates and manages ne w systems development projects Project manager Manages a particular new systems development project Systems manager Manages a particular existing system Operations manager Supervises the day -to-day operations of the data and/or computer center Programming manager Coordinates all applications programming efforts Systems analyst Interfaces between users and programmers; determines information requirements and technical specifications for new applications Business analyst Focuses on designing sol utions for business problems; interfaces closely with users to demonstrate how IT can be used innovatively Systems programmer Creates the computer code for developing new systems software or maintaining existing systems software Applications programmer Creates the computer code for developing new applications or maintaining existing applications Emerging technologies manager Forecasts technology trends and evaluates and experiments with new technologies Network manager Coordinates and manages the organization's voice and data networks Database administrator Manages the organization's databases and oversees the use of database - management software Auditing or computer security manager Oversees the ethical and legal use of information systems Webma ster Manages the organization's World Wide Web site Web designer Creates World Wide Web sites and pages Career opportunities in IS are strong and are projected to remain strong over the next ten years. In fact, when Money Magazine 's Best Jobs in America (http://money.cnn.com/magazines/moneymag/bestjobs/2010 ) listed the “top jobs” in America in 2010, 10 of the top 30 jobs related directly to information technology. These jobs (with their ranks) are: • Software architect (#1) • Database administrator (#7) • Information systems security administrator (#17) • Software development director (#18) • Information technology manager (#20) • Telecommunications and networking manager (#21) • Network operations manager (#24) • Information technology business analyst (#26) • Information technology consultant (#28) • Software development engineer (#30) Not only do IS careers offer strong job growth, but the pay is excellent as well. The Bureau of Labor Statistics, an agency within the U.S. Department of Labor that is responsible for tracking and analyzing trends rel ating to the labor market, notes that the median salary for “computer and information systems managers” is approximately $115,000. Managing Information Resources Managing information systems in modern organizations is a difficult, complex task. Several factors contribute to this complexity. First, information systems have enormous strategic value to organizations.

Firms rely on them so heavily that, in some cases, when these systems are not working (even for a short time), the firm cannot function. (This situation is called “being hostage to information systems.”) Second, information systems are very expensive to acquire, operate, and maintain. A third factor contributing to the difficulty in managing information systems is the evolution of the MIS functi on within the organization. When businesses first began to use computers in the early 1950s, the MIS department “owned” the only computing resource in the organization: the mainframe. At that time, end users did not interact directly with the mainframe. In contrast, in the modern organization, computers are located in all departments, and almost all employees use computers in their work. This situation, known as end user computing , has led to a partnership between the MIS department and the end users. The M IS department now acts as more of a consultant to end users, viewing them as customers. In fact, the main function of the MIS department is to use IT to solve end users' business problems. As a result of these developments, the responsibility for managin g information resources is now divided between the MIS department and the end users. This arrangement raises several important questions: Which resources are managed by whom? What is the role of the MIS department, its structure, and its place within the o rganization? What is the appropriate relationship between the MIS department and the end users? Regardless of who is doing what, it is essential that the MIS department and the end users work in close cooperation. There is no standard set of choices for ho w to regulate and divide responsibility for developing and maintaining information resources between the MIS department and end users. Instead, that division depends on several factors: the size and nature of the organization, the amount and type of IT res ources, the organization's attitudes toward computing, the attitudes of top management toward computing, the maturity level of the technology, the amount and nature of outsourced IT work, and even the countries in which the company operates. Generally spea king, the MIS department is responsible for corporate -level and shared resources, and the end users are responsible for departmental resources. Table 1.2 identifies both the traditional functions and various new, consultative functions of the MIS department. TABLE 1.2 The Changing Role of the Information Systems Department Traditional Functions of the MIS Department • Managing systems development and systems project management • As an end user, you will have critical input into the systems development process. You will learn about systems development in Chapter 14 . • Managing computer operations, including the computer center • Staffing, training, and developing IS skills • Providing technical services • Infrastructure planning, development, and control • As an end user, you will provide critical input about the IS infrastructure needs of your department. New (Consultative) Functions of the MIS Department • Initiating and designing specific strategic information systems • As an end user, your information needs will often mandate the development of new strategic information systems. You will decide which strategic systems you need (because you know your business needs better than the MIS department), and you will provide input into developing these systems. • Incorporating the Internet and electronic commerce into the business • As an end user, you will be primarily responsible for effectively using the Internet and electronic commerce in your business. You will work with the MIS department to accomplish this task. • Managing system integration including the Internet, intranets, and extranets • As an end user, your business needs will determine how you want to use the Internet, your corporate intranets, and extranets to accomplish your goals. You will be primarily responsible for advising the MIS department on the most effective use of the Internet, your corporate intranets, and extranets. • Educating the non -MIS managers about IT • Your department will be primarily responsible for advising the MIS department on how best to educate and train your employees about IT. • Educating the MIS staff about the business • Communication between the MIS department and the business units is a two -way street. You will be responsible for educating the MIS staff on your business, its needs, and its goals. • Partnering with business -unit executives • Essentially, you will be in a partnership with the MIS department. You will be responsible for seeing that this partnership is one “between equals” and ensuring its success. • Managing outsourcing • Outsourcing is driven by business needs. Therefore, the outsourcing decision largely resides with the business units (i.e., with you). The MIS department, working closely with you, will advise you on technical issues such as communications bandwidth, secur ity, and so on. • Proactively using business and technical knowledge to seed innovative ideas about IT • Your business needs will often drive innovative ideas about how to effectively use information systems to accomplish your goals. The best way to bring these innovative uses of IS to life is to partner closely with your MIS department. Such close partnerships have amazing synergies! • Creating business alliances with business partners • The needs of your business unit will drive these alliances, typically along your supply chain. Again, your MIS department will act as your advisor on various issues, including hardware and software compatibility, implementing extranets, communications, and security. So, where do the end users come in? Take a close look at Table 1.2 . Under the traditional MIS functions, you will see two functions for which you provide vital input. Under the consultative MIS functions, you will see how the primary responsibility for each function is exercised, and how the MIS department acts as an advisor. BEFORE YO U G O O N . . . 1. Rate yourself as an informed user. (Be honest; this is not a test!) 2. Explain the benefits of being an informed user of information systems. 3. Discuss the various career opportunities offered in the IT field. RUBY'S CLUB QUESTIONS 1. Given that Ruby's customers are college -age Homo conexus users of technology, do you think it will be possible for the club to be successful moving into the future without a strong IT strategy? 2. If informed users provide more value to a company, can the same be said of informed customers? Student Activity 1.1 Objective: Computers and information systems have become a part of our everyday life not only in the workplace but also at home. This exercise will give you insight into some of the areas where information systems jobs are found. Chapter Connection: This case relates to Chapter 1, Introduction to Information Systems, Section 1.1 : “Why S hould I Study Information Systems?” Prerequisites: You should read Section 1.1 before doing this exercise to become familiar with the jobs and functions of information systems. Activity: In most business jobs you will interface with a computer information system to post transactions or find information easily.

However, some jobs create, support, and manage these information systems on a daily basis. Watch the following video: www.youtube.com/watch?v=A9qBcdoEx00 De liverables: Prepare answers for the following questions: 1. What is involved in the job of an IT manager? 2. What is the schedule for an IT manager's work? 3. What training does an IT manager need? Quiz Questions: 1. What is the benefit of being an informed IT user? (a) You are in a position to recommend solutions. (b) You can keep abreast with newer technology. (c) You can be a more productive employee. (d) All of the above. 2. What does a systems analyst do? (a) Interface between users and programmers (b) Coordinate all programming efforts (c) Writes computer code (d) Manages IS service 3. Which of the following is a career opportunity in IT? (a) Systems analyst (b) Web designer (c) Network security (d) All of the above 4. What makes managing information systems a difficult task? (a) They have strategic value to the organization. (b) The organization relies heavily on them. (c) They are very expensive to buy or create. (d) All of the above 5. What is true about the education of an IS manager? (a) An undergraduate degree is necessary. (b) Constant retraining is necessary. (c) An advanced degree is necessary. (d) A technical degree is necessary. Discussion Questions: Discuss some of the jobs available in the IT field. Do you know anyone who works directly in IT? What is the person's job title and functions? Does he or she like it? Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. 1.2 Overview of Computer -Based Information Systems Audio Mini -Lecture: Overview of Computer -Based Information Systems Organizations refer to their management information systems (MIS) functional area by several names, including the MIS Department, the Information Systems (IS) Department, the Information Technology Department, and the Information Services Department. Regardless of the n ame, however, this functional area deals with the planning for — and the development, management, and use of — information technology tools to help people perform all of the tasks related to information processing and management. IT relates to any computer -bas ed tool that people use to work with information and to support the information and information -processing needs of an organization. An IS collects, processes, stores, analyzes , and disseminates information for a specific purpose. It has been said that the purpose of IS is to get the right information to the right people at the right time in the right amount and in the right format. Because IS are intended to supply useful infor mation, we need to differentiate between information and two closely related terms: data and knowledge (see Figure 1.2 ). Figure 1.2 Binary Code, the foundation of information and knowledge, is the key to making complex decisions. (Source: © janaka Dharmasena -Fotolia.com; Exactostock/SuperStock; uttam gurjar/Shutterstock) Data items refer to an elementary description of things, events, activities, and transactions that are recorded, classified, and stored but are not organized to convey any specific meaning. Data items can be numbers, letters, figures, sounds, and images. Examples of data items are a collection of numbers (e.g., 3.11, 2.96, 3.95, 1.99, 2.08) and characters (e.g., B, A, C, A, B, D, F, C). Information refers to data that have been organized so that they have meaning and value to the recipient. For example, a grade point average (GPA) by itself is data, but a student's name coupled with his or he r GPA is information. The recipient interprets the meaning and draws conclusions and implications from the information. Consider the examples of data provided in the preceding paragraph. Within the context of a university, the numbers could be GPAs, and th e letters could be grades in an Introduction to MIS class. Knowledge consists of data and/or information that have been organized and processed to convey understanding, experience, accumulated learning, and expertise as they apply to a current business problem. For example, a company recruiting at your school has found over time th at students with GPAs over 3.0 have experienced the greatest success in its management program. Based on this accumulated knowledge, that company may decide to interview only those students with GPAs over 3.0. Organizational knowledge, which reflects the e xperience and expertise of many people, has great value to all employees. Consider this example: Data Information Knowledge [No context] [University context] 3.16 *Job prospects 2.92 *Graduate school prospects 1.39 *Scholarship prospects 3.95 [No context] [Professional baseball pitcher context] 3.16 2.92 *Keep pitcher, trade pitcher, or send pitcher to minor leagues 1.39 *Salary/contract negotiations 3.95 GPA = grade point average (higher is better) ERA = earned run average (lower is better); ERA is the number of runs per nine innings accountable to a pitcher You see that the same data items, with no context, can mean entirely different things in different contexts. Now that you have a clearer understanding of data, information, and knowledge, we shift our focus to computer -based information systems. As we noted, these systems process data into information and knowledge that you can use. A computer -based information system (CBIS) is an information system that uses computer technology to perform some or all of its intended tasks. Although not all information systems are computerized, today most are. For this reason the term information system is typically used synonymously with computer -based information system . The following are the basic components of computer -based information systems. The first four are called information technology (IT) components . Figure 1.3 shows how these four components interact to form a CBIS. Figure 1.3 It takes technology (hardware, software, databases, and networks) with appropriate procedures to make a CBIS useful for people. (Source: Nasonov/Shutterstock; Angela Waye/Shutterstock; alexmillos/Shutterstock; broukoid/Shutterstock; zhu difeng/ Shutterstock) • Hardware is a device such as a processor, monitor, keyboard, or printer. Together, these devices accept data and information, process them, and display them. • Software is a program or collection of programs that enable the hardware to pro cess data. • A database is a collection of related files or tables conta ining data. • A network is a connecting system (wireline or wireless) that permits different computers to share resources. • Pro cedures are the set of instructions about how to combine hardware, software, databases, and networks in order to process information and generate the desired output. • Users are those individuals who use the hardware and software, interface with it, or utilize its output. Figure 1.4 shows how these components are integrated to form the wide variety of information systems in an organization. Starting at the bottom of the figure, you see that the IT components of hardware, software, networks (wireline and wireless), and databases form the information technology (IT) platform . IT personnel use these components to develop information systems, oversee security and risk, and manage data. These activities cumulatively are called information technology (IT) services . The IT components plus IT services comprise the organization's information technology (IT) infrastructure . At the top of the pyramid are the various organizational information systems. Figure 1.4 How IT components are integrated to form the wide variety of information systems within a single organization. Computer -based information systems have many capabilities. Table 1.3 summarizes the most important ones. TABLE 1.3 Major Capabilities of Information Systems • Perform high -speed, high -volume, numerical computations • Provide fast, accurate communication and collaboration within and among organizations • Store huge amounts of information in an easy -to-access, yet small, space • Allow quick and inexpensive access to vast amounts of information, worldwide • Interpret vast amounts of data quickly and efficiently • Automate both semiautomatic business processes and manual tasks Information systems perform these various tasks via a wide spectrum of applications. An applicati on (app) is a computer program designed to support a specific task or business process. (A synonymous term is application program .) Each functional area or department within a business organization uses dozens of application programs. For instance, the hum an resources department sometimes uses one application for screening job applicants and another for monitoring employee turnover. The collection of application programs in a single department is usually referred to as a departmental information system (als o known as a functional area information system ). For example, the collection of application programs in the human resources area is called the human resources information system (HRIS ). Collections of application programs — that is, departmental information systems — are used in other functional areas as well, such as accounting, finance, marketing, and production/operations. “IT's About Business 1.2 ” illustrates how electronic discovery software applications improve the efficiency and effectiveness of the legal discovery process. Applications can be downloaded to mobile device or computer. (Source: © Cyberstock/Alamy Limited) IT 's ABOUT BU SINESS 1 .2 Electronic E -Discovery Software Replaces Lawyers When the U.S. Justice Department sued CBS for antitrust violations in 1978, five television studios became involved. The cost to the studios was extremely high. As part of the discovery process — which involves providing documents relevant to a lawsuit — studi o lawyers and paralegals examined 6 million documents at a cost of $2.2 million. Today, electronic discovery (e -discovery) software applications can analyze documents in a fraction of the time at a fraction of the cost. For example, in January 2011, Blacks tone Discovery ( www.blackstonediscovery.com ) helped one company analyze 1.5 million documents for less than $100,000K Some e -discovery applications go beyond j ust rapidly finding documents with relevant terms. They can extract relevant concepts, even in the absence of specific terms, and can deduce patterns of behavior that would have eluded lawyers examining millions of documents. b-discovery software generally falls into two broad categories that can be described as “linguistic” and “sociological.” The most basic linguistic software uses specific search words to find and sort relevant documents. More advanced applications filter documents through a large number of interrelated word and phrase definitionsK In contrast, sociological applications add inferential analysis, closely resembling human reasoning.

For example, software from Cataphora ( www.cataphora.com ) analyzes documents for information pertaining to the activities and interactions of people — who did what and when, and who talked to whom. The software then manipu lates this information to visualize chains of events. It identifies discussions that might have taken place across e -mail, instant messages, and telephone calls. The software then captures digital anomalies that white -collar criminals often create when the y try to hide their activities. For example, the software finds “call me” moments — those incidents during which an employee decides to hide a particular action by having a private conversation. This process usually involves switching media, perhaps from an e-mail conversation to instant messaging, telephone, or even a face -to-face encounter. The Cataphora software can also recognize the sentiment in an e -mail message — whether a person is positive or negative, or what Cataphora calls “loud talking” — unusual emp hasis that might give hints that a document concerns a stressful situation. For example, a shift in an author's e -mail style from breezy to unusually formal can raise a red flag about illegal activity. Another e -discovery company, Clearwell ( www.clearwellsystems.com ), has developed software that analyzes documents to find concepts rather than specific keywords. This process decreases the time required to locate releva nt material in litigation. Clearwell's software uses language analysis and a visual way of representing general concepts found in documents. In 2010, for example, the DLA Piper law firm used Clearwell software to search through some 570,000 documents under a court - imposed deadline of one week. The software analyzed the documents in two days. The law firm required just one more day to identify more than 3,000 documents that were relevant to the discovery motion. E-discovery software is doing an excellent job and, as a result, the discovery process is becoming increasingly automated, scientific, and objective. One lawyer used e -discovery software to reanalyze work his company's lawyers had performed in the 1980s an d 1990s. He discovered that his human colleagues had been only 60 percent accurate. Quantifying the impact of these software applications on employment is difficult. However, the founder of Autonomy ( www.autonomy.com ), an e -discovery firm, is convinced that the U.S. legal sector will likely employ fewer people in the future. He estimates that the shift from manual document discovery to e -discovery will lead to a staff reduction becau se one lawyer can now do the work that once required hundreds of lawyers. Questions 1. What are the advantages of e -discovery software? Provide specific examples. 2. What are the disadvantages of e -discovery software? Provide specific examples. 3. Based on this scenario, how do you think e -discovery software will affect the legal profession? Sources: Compiled from B. Kerschberg, “ E-Discovery and the Rise of Predictive Coding ,” Forbes , March 23, 2011; J. Markoff, “ Armies of Expensive Lawyers, R eplaced by Cheaper Software ,” The New York Times , March 4, 2011; K. Fogarty, “ E-Discovery: How a Law Firm Slashes Time and Costs ,” CIO , February 15, 2011; B. Kerschberg, “ Surviving e -Discovery with the Department of Justice's Antitrust Division ,” Forbes , February 14, 2011; M. Pratt, “ E-Discovery Moves In -House ,” Computerworld , December 30, 2010; www.autonomy.com , www.blackwelldiscovery.com , www.cataphora.com ,www.clearwellsystems.com , accessed July 27, 2011. Types of Computer -Based Information Systems Modern organizations employ many different types of information systems. Figure 1.4 illustrates the different types of information systems that function within a single organization, and Figure 1.5 shows the different types of information systems that function among multiple organizations. You will study transaction processing systems, management information systems, and enterprise resource planning systems in Chapter 11 . You will learn about customer relationship management (CRM) systems in Chapter 12 and supply chain management (SCM) systems in Chapter 13 . Figure 1.5 The different types of information systems that function among multiple organizations. In the next section you will learn about the numerous and diverse types of information systems employed by modern organizations. You will also read about the types of support these systems provide. Breadth of Support of Information Systems. Certain information systems support parts of organizations, others support entire organizations, and still others support groups of organizations. This section addresses all of these systems. Recall that each department or functional area within an organization has its own collection of appl ication programs, or information systems. These functional area information s ystems (FAIS) are supporting pillars for the information systems located at the top of Figure 1.4 : business intelligence systems and dashboards. As the name suggests, each FAIS supports a particular functional area within the organization.

Examples are accounting IS, finance IS, production/operations management (POM) IS, marketing I S, and human resources IS. Data from a coupon center will be connected to marketing and sales, but possibly inventory, accounting, and much more. (Source: © Sonda Dawes/The Image Works) Consider these examples of IT systems in the various functional areas of an organization. In finance and accounting , managers use IT systems to forecast revenues and business activity, to determine the best sources and uses of funds, and to perform audits to ensure that the organization is fundamentally sound and that all financial reports and documents are accurate. In sales and marketing , managers use information technology to perform the following functions: • Product analysis: developing new goods and services • Site analysis: determining the best location for production and distribution facilities • Promotion analysis: identifying the best advertising channels • Price analysis: setting product prices to obtain the highest total revenues Marketing managers also use IT to manage their relationships with their customers. In manufacturing , managers use IT to process customer orders, develop production schedules, control inventory levels, and monitor product quality. They also use IT to design and manufacture products. These process es are called computer -assisted design (CAD) and computer -assisted manufacturing (CAM). Managers in human resources use IT to manage the recruiting process, analyze and screen job applicants, and hire new employees. They also employ IT to help employees m anage their careers, to administer performance tests to employees, and to monitor employee productivity. Finally, they rely on IT to manage compensation and benefits packages. Two information systems support the entire organization: enterprise resource pla nning systems and transaction processing systems. Enterprise resource planning (ERP) systems are designed to correct a lack of communication among the FAISs. As a result, Figure 1.4 shows ERP systems spanning the FAIS. ERP systems were an important innovation because the various FAISs were often developed as stand - alone systems and did not communicate effectively (if at all) with one another. ERP systems resolve this problem by tightly integrating the FAISs via a common database. In doing so, they enhance communications among the functional areas of an organization. For this reason, experts credit ERP systems with greatly increasing organizational producti vity. A transaction processing system (TPS) supports the monitoring, collecti on, storage, and processing of data from the organization's basic business transactions, each of which generates data. For example, when you are checking out of Walmart, each time the cashier swipes an item across the bar code reader, that is one transacti on. Definitions of a transaction differ throughout an organization. In accounting, for example, a transaction is anything that changes a firm's chart of accounts. The information system definition of a transaction is broader: A transaction is anything that changes the firm's database. The chart of accounts is only part of the firm's database. Consider a scenario in which a student transfers from one section of an Introduction to MIS course to another section. This move would be a transaction in the universi ty's information system, but not a transaction in the university's accounting department. The TPS collects data continuously, typically in real time — that is, as soon as the data are generated — and provides the input data for the corporate databases. TPSs ar e considered critical to the success of any enterprise because they support core operations. Significantly, nearly all ERP systems are also TPSs, but not all TPSs are ERP systems. In fact, modern ERP systems incorporate many functions that have previously been handled by the organization's functional area information systems. You study both TPSs and ERP systems in detail in Chapter 11 . ERP systems and TPS function primarily within a single organization. Information systems that connect two or more organizations are referred to as interorganizational information systems (IOSs) . IOSs support many interorganizational operations, of which supply chain m anagement is the best known. An organization's supply chain is the flow of ma terials, information, money, and services from suppliers of raw materials through factories and warehouses to the end customers. Note that the supply chain in Figure 1.5 shows physical flows, information flows, and financial flows. Digitizable pr oducts are those that can be represented in electronic form, such as music and software. Information flows, financial flows, and digitizable products go through the Internet, whereas physical products are shipped. For example, when you order a computer fro m www.dell.com , your information goes to Dell via the Internet. When your transaction is completed (i.e., your credit card is approved and your order is processed), Dell ships your computer to you. Electronic commerce systems are another type of interorganizational information system. An electronic commerce (e -commerce) system enable organizations to conduct transac tions, called business -to-business (B2B) electronic commerce, and customers to conduct transactions with businesses, called business -to- consumer (B2C) electronic commerce. ( Note: You will learn about other types of e -commerce systems in Chapter 9). E -commerce systems are typically Internet based. Figure 1.5 illustrates B2B and B2C electronic commerce. Support for Organizational Employees. So far you have concentrated on information systems that support specific functional areas and operations. Now you will learn about information systems that typically support particular employees within the organization. Clerical workers , who support managers at all levels of the organization, include bookkeepers, secretaries, electronic file clerks, and insurance claim processors. Lower -level managers handle the day -to-day operations of the organization, making routine decisions such as assigning tasks to employees and placing purchase orders. Middle managers make tactical decisions, which deal with activities such as short -term planning, organizing, and control. Knowledge workers are professional employees, such as financial and marketing analysts, engineers, lawyers, and accountants. All knowledge workers are experts in a particular subject area. They create information and knowledge, which they integrate into the business. Knowledge workers act as advisors to middle managers and executives. Finally, executives make decisions that deal with situations that can significantly change the manner in which business is done. Examples of executive decisions are introducing a new product line, acquiring other businesses, and relocating operations to a foreign country. Office automation systems (OASs) typically support the clerical staff, lower and middle managers, and knowledge workers. These employees use OASs to develop docu ments (word processing and desktop publishing software), schedule resources (electronic calendars), and communicate (e -mail, voice mail, videoconferencing, and groupware). FAISs summarize data and prepare reports, primarily for middle managers, but sometim es for lower -level managers as well. Because these reports typically concern a specific functional area, report generators (RPGs) are an important type of functional area IS. Business intelligence (BI) systems provide computer -based support for complex, nonroutine decisions, primarily for middle managers and knowledge workers. (The y also support lower -level managers, but to a lesser extent.) These systems are typically used with a data warehouse, and they enable users to perform their own data analysis. You learn about BI systems in Chapter 5. Expert systems (ESs) attempt to duplicate the work of human experts by applying reasoning capabilities, knowledge, and expertise within a specific domain. They have become valuable in many application areas, primarily but not exclusively areas involving decision making. For example, navigation systems use rules to select routes, but we do not typically think of these systems as expert systems. Significantly, expert systems can operate as stand -alone systems or be embedded in other applications. We examine ESs in greater detail in “Plug IT In 4.” Dashboards (also called digital dashboards ) are a special form of IS that supports all managers of the organization. They provide rapid access to timely information and direct acces s to structured information in the form of reports. Dashboards that are tailored to the information needs of executives are called executive dashboards . Chapter 5 provides a thorough discussion of dashboards. Table 1.4 provides an overview of the different types of information systems used by o rganizations. TABLE 1.4 Types of Organizational Information Systems Type of System Function Example Functional area IS Supports the activities within specific functional area System for processing payroll Transaction processing system Processes transaction data from business events Walmart checkout point -of-sale terminal Enterprise resource planning system Integrates all functional areas of the organization Oracle, SAP Office automation system Supports daily work activities of individuals and g roups Microsoft Office Management information system Produces reports summarized from transaction data, usually in one functional area Report on total sales for each customer Decision support system Provides access to data and analysis tools “What -if” analysis of changes in budget Expert system Mimics human expert in a particular area and makes decisions Credit card approval analysis Executive dashboard Presents structured, summarized information about aspects of business important to executives Status of sales by product Supply chain management system Manages flows of products, services, and information among organizations Walmart Retail Link system connecting suppliers to Walmart Electronic commerce system Enables transactions among organizati ons and between organizations and customers www.dell.com BEFORE YO U G O ON . . . 1. What is a computer -based information system? 2. Describe the components of computer -based information systems. 3. What is an application program? 4. Explain how information systems provide support for knowledge workers. 5. As we move up the organization's hierarchy from clerical workers to executives, how does the type of support provided by information systems change? RUBY'S CLUB QUESTIONS 1. Given that Ruby's is a bar with a small food menu, what type of data do you think Ruben and Lisa should collect from a single transaction (an order for food)? 2. How can Ruby's use data from transactions over a month to help manage inventory? 3. If Ruben and Lisa have transactional data that are organized to create information regarding their customer base, what knowledge could be gained from this that would help them develop a marketing plan? 4. Ruben and Lisa have always spent hours going through paper receipts trying to determine past sales.

They need these figures to know what quantities to purchase for the products they sell. Given that some of their produc ts have a short shelf life (perishable foods), this needs to be very accurate. In what ways could the capabilities of information systems help them accomplish this task? 5. What type of procedures would Ruben and Lisa need to ensure that the people int eracting with the information systems are doing so in an appropriate manner (i.e., correctly inputting data, not using customer data, etc.)? Student Ac tivity 1.

2 Objective: Computer -based information systems are used by employees in most businesses today. In this exercise we cover the functional groups in most companies and the various information systems that they would use. Chapter Connection: This case relates to Chapter 1, Introduction to Information Systems, Section 1.2 : “Overview of Computer -Based Information Systems.” Prerequisites: You should read Section 1.2 before doing this exercise to become familiar with the functional departments within most organization and the types of information systems. Activity: There are four major functional areas in most business: marketing, finance/accounting, manufacturing, and human resources. All of them use information systems, but often they are performing different activities relating to their job functions but using the same database. Also, there are numerous types and levels of information systems. Many companies use transaction processing systems, management informa tion systems, and decision support systems. In this activity, we relate the functional groups with the specific type of information systems. Deliverables: 1. Briefly define the major function of the following departments in most companies: marketing, finance/accounting, manufacturing, and human resources. 2. Define the basic function of the following types of information systems: transaction processing, management information, and decision support. 3. Based on the preceding definition, fill in the following chart with specific examples of each type of IS. For instance, marketing would enter new orders using transaction processing. Transaction Processing Management Information Decision Support Marketing Accounting/Finance Manufacturing Human Resources Quiz Questions: 1. What department manages the financial needs of the company? (a) Marketing (b) Accounting (c) Manufacturing (d) Human resources 2. What department reviews the benefit packages for employees? (a) Marketing (b) Accounting (c) Manufacturing (d) Human resources 3. What information system tracks the day -to-day activity of a company? (a) Transaction processing (b) Management information (c) Decision support (d) Expert system 4. What information system conducts a what -if scenario to help determine the best alternative? (a) Transaction processing (b) Management information (c) Decision support (d) Expert system Discussion Question: How do the functions of the various departments within a company differ (i.e., marketing, human resources, etc.)? Discuss how the employees in each department within a company would use a computer -based information system with a database to do their jobs and interface with each o ther . Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. 1.3 How Does IT Impact Organizations? Audio Mini -Lecture: How Does IT Impact Organizations? Throughout this book you will encounter numerous examples of how IT affects various types of organizations. This section provides an overview of the impact of IT on modern organizations. As you read this section you will learn how each of these impacts will affect you as well. IT Will Reduce the Number of Middle Managers IT makes managers more productive, and it increases the number of employees who can report to a single manager. In these ways IT ultimately decreases the number of managers and experts. It is reasonable to assume, therefore, that in the coming years organizations will have fewer managerial levels and fewer staff and line managers. If this trend materializes, then promotional opportunities will decrease, making promotions much more competitive. Bottom line: Pay attention in school! IT Will Change the Manager's Job One of the most important tasks of managers is making decisions. One of the major consequences of IT has been to change the manner in which managers make many of their decisions. In this way IT ultimately has changed managers' jobs. IT o ften provides managers with near real -time information, meaning that managers have less time to make decisions, making their jobs even more stressful. Fortunately, IT also provides many tools — for example, business intelligence applications such as dashboar ds, search engines, and intranets — to help managers handle the volumes of information they must deal with on an ongoing basis. We have been focusing on managers in general in this section. Now, let's focus on you. Due to advances in IT, you will increasingl y supervise employees and teams who are geographically dispersed. Employees can work from anywhere at any time, and teams can consist of employees who are literally dispersed throughout the world. Information technologies such as telepresence systems (disc ussed in Chapter 4) can help you manage these employees even though you do not often see them face to face. For these employees, electronic or “remote” supervision will become the norm. Remote supervision places greater emphasis on completed work and less emphasis on personal contacts and office politics. You will have to reassure your employees that they are valued members of the organization, thereby diminishing any feelings they might have of being isolated and “out of the loop.” Will IT Eliminate Jobs? One of the major concerns of every employee, part time or full time, is job security. Relentless cost -cutting measures in modern organizations often lead to large -scale layoffs. Put simply, organizations are responding to today's highly competitive environment by doing more with less. Regardless of your position, then, you consistently will have to add value to your organization and to make certain that your superiors are aware of this value. Many companies have responded to difficult economic times, increased global competition, demands for customization, and increased con sumer sophistication by increasing their investments in IT. In fact, as computers continue to advance in terms of intelligence and capabilities, the competitive advantage of replacing people with machines is increasing rapidly. This process frequently lead s to layoffs. At the same time, however, IT creates entirely new categories of jobs, such as electronic medical record keeping and nanotechnology. IT Impacts Employees at Work Many people have experienced a loss of identity because of computerization. They feel like “just another number” because computers reduce or eliminate the human element that was present in noncomputerized systems. The Internet threatens to exert an even more isolating influence than computers and television.

Encouraging people to work and shop from their living rooms could produce some unfortunate psychological effects, such as depression and loneliness. IT Impacts Employees' Health and Safety. Although computers and information systems are generally regarded as agents of “progress,” t hey can adversely affect individuals' health and safety. To illustrate this point, we consider two issues associated with IT: job stress and long -term use of the keyboard. An increase in an employee's workload and/or responsibilities can trigger job stress . Although computerization has benefited organizations by increasing productivity, it has also created an ever - expanding workload for some employees. Some workers feel overwhelmed and have become increasingly anxious about their job performance. These feel ings of stress and anxiety can actually diminish rather than improve workers' productivity while jeopardizing their physical and mental health. Management can help to alleviate these problems by providing training, redistributing the workload among workers , and hiring more workers. On a more specific level, the long -term use of keyboards can lead to repetitive strain injuries such as backaches and muscle tension in the wrists and fingers. Carpal tunnel syndrome is a particularly painful form of repetitive strain injury that affects the wrists and hands. Designers are aware of the potential problems associated with the prolonged use of computers. To address these problems, they continually attempt to design a better computing environment. The science of desi gning machines and work settings that minimize injury and illness is called ergonomics . The goal of ergonomics is to create an environment that is safe, well lit, and comfortable. Examples of ergonomically designed products are antiglare screens that alleviate problems of fatigued or damaged eyesight and chairs that contour the hum an body to decrease backaches. Figure 1.6 displays some sample ergonomic products. (a) Wrist support. ( Source: Media Bakery) (b) Back support. ( Source: Media Bakery) (c) Eye -protection filter (optically coated glass). ( Source: Media Bakery) (d) Adjustable foot rest. (Source: Media Bakery) Figure 1.6 Ergonomic products protect computer users. IT Provides Opportunities for People with Disabilities. Computers can create new employment opportunities for people with disabilities by integrating speech - and vision -recognition capabilities. For example, individuals who cannot type are able to use a voice - operated keyboard, and individuals who cannot travel can work at home. Going further, adaptive equipment for computers permits people with disabilities to per form tasks they would not normally be able to do. You should note that the Web and graphical user interfaces (e.g., Microsoft Windows) can still make life difficult for people with impaired vision. Adding audible screen tips and voice interfaces to deal wi th this problem essentially restores functionality to the way it was before rich, graphical interfaces became standard. Other devices help improve the quality of life for people with disabilities in more mundane, but useful, ways. Examples are a two -way wr iting telephone, a robotic page turner, a hair brusher, and a hospital - bedside video trip to the zoo or the museum. Several organizations specialize in IT designed for people with disabilities. BEFORE YO U G O ON . . . 1. Why should employees in all functional areas become knowledgeable about IT? 2. Describe how IT might change the manager's job. 3. Discuss several ways in which IT impacts employees at work. Student Acti vity 1.

3 Objective: This exercise is to help you understand why we study information systems and the impact they can have on the business organization. Chapter Connection: This case relates to Chapter 1, Introduction to Information Systems, Section 1.3 : “How Does IT Impact Organizations?” Prerequisites: You should read Section 1.3 before doing this exercise to become familiar with the use of information systems. Activity: Chances are you own a personal computer that you use in some way every day. Think of five (5) activities that you use your computer for on a regular basis. Most likely many of these activities have to do with school and your classes. However, I would guess that you also use your computer to communicate with friends and family, to find out what movies are showing in theaters this weekend, or to check flights for travel on your next break.

Most of us would miss our computers and the information systems we hav e available through them to help us with these tasks. They add “value” to our lives. The same is true for most business organizations. They depend on computer information systems to complete their daily tasks and to add value to their organizationK Watch t he following video on using a computer to your advantage: www.youtube.com/watch?v=M56YKleMdNs&feature=related K Deliverable: Based on the video, list five (5) benefits mentioned for using information systems in a business. However, there are many other ways in which a business depends on information systems. Also name five (5) other benefits an information system c an provide. Think of ways you have used information systems to interface with a business and the value you have found. Quiz Questions: 1. Based on the video, which of the following would not be a benefit of a computer - based information system? (a) Global customer access (b) Decreased revenue (c) Reduced costs (d) Instant information 2. Based on the video, what is the biggest value of computer -based information systems in business? (a) Reduced costs (b) Instant distribution channel (c) Increased revenue (d) Current information 3. Information systems are important to: (a) Organizations (b) Society (c) People (d) All of the above 4. What are some ways in which computer information systems can help reduce costs? (a) Customer mailings (b) Letter writing (c) Administrative activities (d) All of the above Discussion Question: In our daily activities, we interact with many computer -based information systems. Think of places you have been in just the last week where an information system was being used to complete a transaction or activity. What would have been different had no computer system been available? Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. 1.4 Why Are Information Systems Important to Society? Audio Mini -Lecture: Why Are Information Systems Important to Society? This section explains in greater detail why IT is important to society as a whole. Other examples of the impacts of IT on society appear throughout the book. IT Affects Our Quality of Life IT has significant implications for our quality of life. The workplace can be expanded from the traditional 9-to-5 job at a central location to 24 hours a day at any location. IT can provide employees with flexibility that can significantly improve the quality of leisure time, even if it does not increase the total amount of leisure time. From the opposite perspective, however, IT can also place employees on “constant call” where they are never truly away from the office, even when they are on vacation. In fact, a recent poll revealed that 80 percent of respondents took their laptop computers on their most recent vacations, and 100 percent took their cell phones. Going further, 80 percent did some work while vacationing, and almost all of them checked their e -mail. Robot Revolution on the Way Once restricted largely to science fiction movies, robots that can perform practical tasks are becoming more common. In fact, “cyberpooches,” nursebots, and other mechanical beings may be our companions before we know it. Around the world, quasi -autonomous devices have become increasingly c ommon on factory floors, in hospital corridors, and in farm fields. In our homes, iRobot ( www.irobot.com ) produces the Roomba to vacuum our floors, the Scooba to wash our floors, the Di rt Dog to sweep our garages, the Verro to clean our pools, and the Looj to clean our gutters. Telepresence robots are a recent development in the field of robotics. The following example illustrates how organizations use these robots. EXAMPLE Telepresence robots have been humorously described as a cross between a Segway and Wall -E. These robots are designed to help companies save money on travel and on expensive teleconferencing technology. The robots enable people in remote offices or location s to have a rich communications experience without having to use a complicated videoconferencing system. A telepresence robot has both a video camera and a video screen embedded in its “head.” It also has wheels and can be moved around remotely by computer . It is designed to steer its way clear of obstacles or people. The robots let a person maintain a consistent connection with co -workers, customers, or clients. The human user places the robot at a remote location and directs it to move around — for example, around a conference room during a meeting — while broadcasting what is going on to the human controlling it from afar. Interestingly, the robots actually break down barriers of awkwardness that people sometimes feel in person -to-person meetings. Although th is technology is rather expensive, some companies are buying multiple units to place in their remote locations. That way, someone running a meeting could obtain an easy and flexible view into what is being said — and what is being written on a whiteboard, fo r example — in each location, without having to spend hundreds of thousands of dollars on travel costsK Business managers are using telepresence robots to walk factory floors. Healthcare organizations are employing them for home care. Storage companies are u tilizing them for security. In the retail environment, a robot could wander the floor with a customer who asks it purchasing or support questions. The person controlling the robot could answer the questions, essentially making the robot a mechanical sales clerk. Consider how Reimers Electra Steam uses a telepresence robot. One of the firm's electrical engineers, John Samuels, moved from the company's location in Virginia to the Dominican Republic. At first, he would attend meetings in Virginia through Skyp e. If he needed to see something on the shop floor, a colleague would carry around a laptop, pointing it to wherever Samuels instructed. Essentially, someone had to act as the remote virtual body for Samuels, and if no one was available, then Samuels was o ut of luck. To resolve this problem, the company purchased a telepresence robot for Samuels. Now, “he” wheels easily from desk to desk and around the shop floor, answering questions and inspecting designs, often using the robot's vision feature to examine wiring in detail. Sources: Compiled from D. Bennett, “ I'll Have My Robots Talk to Your Robots ,” Bloomberg BusinessWeek , February 21–27, 2011; A. Diana, “ 12 Advances in Medical Robotics ,” InformationWeek , January 29, 2011; D. Terdiman, “ The Telepresence Robots Are Coming ,”CNET.com , May 18, 2010; www.anybots.com , accessed July 27, 2011. In an example of precision agriculture, Carnegie Mellon University in Pittsburgh has developed self - directing tractors that harvest hundreds of acres of crops around the clock in California. These “robot tractors” use global positioning systems (GPSs) combined with video image proce ssing that identifies rows of uncut crops. Many robotic devices are also being developed for military purposes. For example, the Pentagon is researching self -driving vehicles and beelike swarms of small surveillance robots, each of which would contribute a different view or angle of a combat zone. The Predator, an unmanned aerial vehicle (UAV), is being used in Iraq, Libya, Pakistan, and Afghanistan. It probably will be a long time before we see robots making decisions by themselves, handling unfamiliar situations, and interacting with people. Nevertheless, robots are extremely helpful in various environments, particularly environments that are repetitive, harsh, or dangerous to humans. Improvements in Healthcare IT has brought about major improvements in he althcare delivery. Medical personnel use IT to make better and faster diagnoses and to monitor critically ill patients more accurately. IT also has streamlined the process of researching and developing new drugs. Expert systems now help doctors diagnose di seases, and machine vision is enhancing the work of radiologists. Surgeons use virtual reality to plan complex surgeries. They also have used a surgical robot to perform long -distance surgery by controlling the robot's movements. In addition, doctors discu ss complex medical cases via videoconferencing, and new computer simulations recreate the sense of touch, allowing doctors -in-training to perform virtual procedures without risking harm to an actual patient. Of the thousands of other applications related t o healthcare, administrative systems are critically important. These systems range from detecting insurance fraud to creating nursing schedules to financial and marketing management. The Internet contains vast amounts of useful medical information (see www.webmd.com , for example). In an interesting study, researchers at the Princess Alexandra Hospital in Brisbane, Australia, identified 26 difficult diagnostic cases published in the New En gland Journal of Medicine . They selected three to five search terms from each case and then conducted a Google search. The researchers selected and recorded the three diagnoses that Google ranked most prominently and that appeared to fit the symptoms and s igns. They then compared these results with the correct diagnoses as published in the journal. They discovered that their Google searches had found the correct diagnosis in 15 of the 26 cases, a success rate of 57 percent. The researchers caution, however, against the dangers of self -diagnosis. They maintain that people should use the information gained from Google and medical Web sites such as WebMD only to participate in their healthcare by asking questions of their physician. BEFORE YO U G O O N . . . 1. What are some of the quality -of-life improvements made possible by IT? Has IT had any negative effects on our quality of life? 2. Describe the robotic revolution, and consider its possible implications for humans. 3. Explain how IT has improved healthcare practices. RUBY'S CLUB QUESTIONS 1. How might a well -designed IS impact Ruby's employees? Specifically, how might it impact Ruben and Lisa? What aspects of running a club would be easier on a computer than on paper? 2. Do you think the addition of an IS would create or eliminate jobs at Ruby's? Student Activity 1.4 Objective: To explore ways in which computers and information systems have become a part of our everyday life not only in the work place but also in our personal lives. Chapter Connection: This case relates to Chapter 1, Introduction to Information Systems, Section 1.4 : “Why Are Information Systems Important to Society?” Prerequisites: The student should read Section 1.4 before doing this exercise to become fami liar with the influence information systems have had on society. Activity: One thing we all use information systems and the Internet for is to communicate with friends, family, and colleagues. Many use e -mail, Facebook, or other social networking sites to do this. However, what if you want to collaborate with others online? Google Docs provides an easy and free way to do this. To do this exercise, you must first have a valid Gmail account. If you do not have a Gmail account, go to www.google.com , click “Gmail” at the top, and create a new account. Then click on the following link: docs.google.com View samples of all that you can create using Google Docs. Click to get an overview of how Google Docs works and its benefits. Deliverable: To really understand the benefits of Google Docs, you need to work in a group so you can share files. Select another classma te or two and create some documents together . 1. Create a document that has the following information: (a) The name of your university (b) The name, section, teacher, and meeting time of your class (c) The names of all teammates (d) A brief summary written together of some ways in which you feel you could use Google Docs in your classes.

Have each team member add his or her own ideas and comments. 2. Create a presentation for the group with the following content: (a) An initial slide with the following: i. Class name, section, teacher, meeting time, and room ii. University name and location (b) A slide for each member of the team (created by each member) to include: i. Full name ii. Major and minor iii. Hometown iv. Some personal information, such as hobbies, children, jobs, and so on v. Student picture Quiz Questions: 1. What can be created using Google Docs? (a) Resume (b) Monthly budget (c) Flowchart (d) All of the above 2. When using Google Docs, when are revisions saved? (a) When the session is complete (b) At the end of the day (c) Immediately (d) When you click “Save” 3. What can be included in a Google Docs presentation? (a) Images (b) Videos (c) Speaker notes (d) All of the above 4. What is used to collaborate with others in a “live” mode in Google Docs? (a) E-mail (b) Chat (c) Texting (d) All of the above 5. All documents created on Google Docs start out with what type of access? (a) Private (b) Public (c) Availability to anyone with link (d) All of the above Discussion Questions: Now that you have used Google Docs, discuss some of the benefits of its use. What are some ways in which you could use Google Docs on campus, at work, or at home? Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. What's in IT for ME? In a previous section of this chapter, we discussed how IT supports each of the functional areas of the organization. Here we examine the MIS function. FOR THE MIS MAJOR The MIS function directly supports all other functional areas in an organization. That is, the MIS function is responsible for providing the information that each functional area needs in order to make decisions. The overall objective of MIS personnel is to help users improve performance and solve business problems using IT. To accomplish this objective, MIS personnel must understand both the information requirements and the technology associated with each function al area. Given their position, however, MIS personnel must think “business needs” first and “technology” second. Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. >>> SUMMARY 1. Begin the process of becoming an informed user of your organization's information systems. The benefits of being an informed user of IT include the following: > You will benefit more from your organization's IT applications because you will understand what is “behind” those applicationsK > You will be able to provide input into your organization's IT applications, thus improving the quality of those applications. > You will quickly be in a position to recommend, or participate in the selection of IT applications that your organization will use. > You will be able to keep up with rapid developments in existing information technologies, as well as the introduction of new technologies. > You will understand the potential impacts that “new and improved” technologies will have on your organization and, therefore, will be qualified to make recommendations concerning their adoption and useK > You will play a key role in managing the information systems in your organization. > You will be in a position to use IT if you decide to start your own business. 2. Define the terms data , information , and knowledge , and give examples of each. > Data items refer to an elementary description of things, events, activities, and transactions that are recorded, classified, and stored but are not organized to convey any specific meaning. Examples of data items are a collection of numbers (e.g., 3.11, 2.96, 3.95, 1.99, 2.08) and characters (e.g., B, A, C, A, B, D, F, C). > Information is data that have been organized so that they have meaning and value to the recipient. For example, a grade point average (GPA) by itself is data, but a student's name coupled with his or her GPA is information. In these examples, the numbers could be GPA s, and the letters could be grades in an Introduction to MIS class. > Knowledge consists of data and/or information that have been organized and processed to convey understanding, experience, accumulated learning, and expertise as they apply to a curre nt business problem. For example, a company recruiting at your school has found over time that students with GPAs over 3.0 have enjoyed the greatest success in its management program. Based on this accumulated knowledge, that company may decide to intervie w only those students with GPAs over 3.0. 3. Define the terms information technology, information system, computer -based information system, and application. > Information technology (IT) relates to any computer -based tool that people use to work with information and to support the information and information -processing needs of an organization. > An information system (IS) collects, processes, stores, analyzes, and disseminates information for a specific purpose. A computer -based informat ion system (CBIS) is an information system that uses computer technology to perform some or all of its intended tasks. An application (or app ) is a computer program designed to support a specific task or business process. 4. Identify several ways in which you depend on information technology in your daily life. You are practicing continuous computing, where you are surrounded with a movable information network. Think of all you do online, often with your phone: register for classes; take classes, a nd not just classes from your university; access class syllabi, information, PowerPoints, and lectures; conduct banking; pay your bills; research, shop, and buy products from companies or other people; sell your “stuff”; search for, and apply for, jobs; ha ve your own page on Facebook; text and tweet your friends and family throughout your day; and many other activitiesK 5. Discuss three ways in which information technology can impact managers and three ways in which it can impact nonmanagerial workers. Potential IT impacts on managers: > IT may reduce the number of middle managers. > IT will provide managers with real -time or near real -time information, meaning that managers will have less time to make decisions. > IT will increase the likelihood that managers will have to supervise geographically dispersed employees and teams. Potential IT impacts on nonmanagerial workers: > IT may eliminate jobs. > IT may cause employees to experience a loss of identity. > IT may cause job stress and physical problems, such as repetitive stress injury. > List three positive and three negative societal effects of the increased use of information technology. Positive societal effects: > IT can provide opportunities for people with disabilities. > IT can provide people with flexibility in their work (e.g., work from anywhere, anytime). > Robots can take over mundane chores. > IT can enable improvements in healthcare. Negative societal effects: > IT can cause health problems for individuals. > IT can place employees on constant call. > IT can potentially misinform patients about their health problems. Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. >>> CHAPTER GLOSSARY application (app) A computer program designed to support a specific task or business process. business intelligence (BI) systems Provide computer -based support for complex, nonroutine decisions, primarily for middle managers and knowledge workers. computer -based information system (CBIS) An information system that uses computer technology to perform some or all of its intended tasks. dashboards (or digital dashboards) A special form of IS that supports all managers of the organization by providing rapid access to timely information and direct access to structured information in the form of reports. database A collection of related files or tables containing data. data items Elementa ry descriptions of things, events, activities, and transactions that are recorded, classified, and stored but are not organized to convey any specific meaning. electronic commerce (e -commerce) system A type of interorganizational information system that enables organizations to conduct transactions, called business -to-business (B2B) electronic commerce, and customers to conduct transactions with businesses, called business -to-consumer (B2C) electronic commerce. enterprise resource planning (ERP) systems ISs that correct a lack of communication among the FAISs by tightly integrating the functional area ISs via a common database. ergonomics The science of adapting machines and work environments to people with the goal of creating an environment that is safe , well lit, and comfortable. expert systems (ESs) Attempt to duplicate the work of human experts by applying reasoning capabilities, knowledge, and expertise within a specific domain. functional area information systems (FAISs) ISs that support a particu lar functional area within the organization. hardware A device such as a processor, monitor, keyboard, or printer. Together, these devices accept data and information, process them, and display them. information Data that have been organized so that they have meaning and value to the recipient. information system (IS) Collects, processes, stores, analyzes, and disseminates information for a specific purpose. information technology (IT) Relates to any computer -based tool that people use to work with info rmation and support the information and information -processing needs of an organization. information technology (IT) components Hardware, software, databases, and networks. information technology (IT) infrastructure IT components plus IT services. inform ation technology (IT) platform Formed by the IT components of hardware, software, networks (wireline and wireless), and databases. information technology (IT) services IT personnel use IT components to perform these IT services: develop information syste ms, oversee security and risk, and manage data. informed user A person knowledgeable about information systems and information technology. interorganizational information systems (IOSs) Information systems that connect two or more organizations. knowledg e Data and/or information that have been organized and processed to convey understanding, experience, accumulated learning, and expertise as they apply to a current problem or activity. knowledge workers Professional employees, such as financial and mark eting analysts, engineers, lawyers, and accountants, who are experts in a particular subject area and create information and knowledge, which they integrate into the business. network A connecting system (wireline or wireless) that permits different compu ters to share resources. office automation systems (OASs) Typically support clerical staff, lower and middle managers, and knowledge workers to develop documents, schedule resources, and communicate. procedures The set of instructions about how to combin e the components of information technology in order to process information and generate the desired output. software A program or collection of programs that enable the hardware to process data. supply chain The flow of materials, information, money, and services from suppliers of raw materials through factories and warehouses to the end customers. transaction processing system (TPS) Supports the monitoring, collection, storage, and processing of data from the organization's basic business transactions, each of which generates data. >>> DISCUSSION QUESTIONS 1. Describe a business that you would like to start. Discuss how you would use global outsourcing to accomplish your goals. 2. Your university wants to recruit high -quality high school students from your state. Provide examples of (a) the data that your recruiters would gather in this process, (b) the information that your recruiters would process from these data, and (c) the types of knowledge that your recruiters would infer from this information. 3. Can the terms data , information , and knowledge have different meanings for different people? Support your answer with examples. 4. Information technology makes it possible to “never be out of touch.” Discuss the pros and cons of always being available to your employers and clients (regardless of where you are or what you are doing). 5. Robots have the positive impact of being able to relieve humans from working in dangerous conditions.

What are some negative impacts of robots in the workplace? 6. Is it possible to endanger yourself by accessing too much medical information on the Web? Why or why not? Support your answer. 7. Is the vast amount of medical information on the Web a good thing? Answer from the standpoint of a patient and from the standpoint of a physician. 8. Describe other potential impacts of IT on societies as a whole. 9. What are the major reasons why it is important for employees in all functional areas to become familiar with IT? 10. Refer to the study at Princess Alexandra Hospital (see “Improvements in Healthcare”). How do you feel about Google searches finding the correct diagnosis in 57 percent of the cases? Are you impressed with these results? Why or why not? What are the implica tions of this study for self -diagnosis? Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. >>> PROBLEM -SOLVING ACTIVITIES 1.

Visit some Web sites that offer employment opportunities in IT. Prominent examples are www.dice.com , www.monster.com ,www.collegerecruiter.com , www.careerbuilder.com , www.jobce ntral.com , www.job.com , www.career.com ,www.simplyhired.com , and www.truecareers.com . Compare the IT salaries to salaries offered to accountants, marketing personnel, financial personnel, operations personnel, and human resources personnel. For o ther information on IT salaries, check Computerworld' s annual salary survey. 2. Enter the Web site of UPS ( www.ups.com ). (a) Find out what information is available to customers before they send a package. (b) Find out about the “package tracking” system. (c) Compute the cost of delivering a 10˝ × 20˝ × 15˝ box, weighing 40 pounds, from your hometown to Long Beach, California (or to Lansing, Michigan, if you live in or near Long Beach). Compare the fastest delivery against the least cost. 3. Surf the Internet for information about the Department of Homeland Security (DHS). Examine the available information, and comment on the role of information technologies in the department. 4. Access www.irobot.com , and investigate the company's robots for education and research. Surf the Web for other companies that manufacture robots, and compare their products with those of iRobot. >>> TEAM ASSIGNMENTS 1. (a) Create an online group for studying IT or an aspect of IT that you are interested in. Each member of the group must establish a free Yahoo! e -mail account. Go to http://groups.yahoo.com . Step 1: Click on “Start Your Group.” Step 2: Select a category that best describes your group (use Search Group Categories, or use the Browse Group Categories tool). Yahoo will force you to be very specific in categorizing your group. Continue until you see the button “Place My Group Here.” Step 3: Name your group. Step 4: Enter your group e -mail address. Step 5: Describe your group. Step 6: Select your Yahoo! Profile and e -mail addresses for your group. Step 7: Customize your group and invite people to join. Step 8: Conduct a discussion online of at least two topics of interest to the group. Step 9: Find a similar group (use Yahoo's “Find a Group” and make a connection). Write a report for your instructor. (b) Now, follow the same steps for Google Groups. (c) Compare Yahoo Groups and Google Groups. 2. Review the Wall Street Journal , Fortune , BusinessWeek , and local newspapers for the last three months to find stories about the use of computer -based information systems in organizations. Each group will prepare a report describing five applications. The reports should emphasize the role of each application and its benefit to the organization. Present and discuss your work. Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. CLOSING CASE 1 > Revolution! >>> THE PROBLEM In January 2011, the modern Arab world's first successful popular uprising, called the Jasmine Revolution (named for the national flower), erupted in Tunisia when a small -town policewoman slapped a fruit seller named Mohammed Bouazizi and ordered him to pa ck up his street cart. Bouazizi was a computer science graduate who was unable to find any work as a computer technician. As a result, he was forced to sell fruit to support his seven siblings. Bouazizi, like many young, educated Tunisians, was frustrated by the overall lack of opportunities. For him, the slap was the final straw. He went to the governor's office and demanded an appointment, threatening to set himself on fire in public if the governor refused to see him. Despite this dire warning, he was turned away. In response, on December 17, 2010, Bouazizi carried out his threat. When he died 18 days later, his story went viral, providing millions of angry young Tunisians with a martyr. Vast numbers of protestors took to the streets, sparking the Jasmine Revolution. The Jasmine Revolution did not need any prominent leaders to rally the protesters or to organize the demonstrations. Instead, the revolution was fueled by a steady stream of anonymous text messages and Twitter and Facebook updates. Documents posted on WikiLeaks (see Chapter 6), in which U.S. diplomats had cataloged the corruption at the highest levels of the Tunisian government, deepened the popular rage. Mobile phone videos posted online documented the government's brutal response, including scenes of the police beating and shooting at protestors, leading to at lea st a hundred deaths. The protesters used the one weapon they understood much better than the government: the Internet. Young Tunisians — educated, multilingual, and wired — devised strategies to evade the government's crude firewalls. Protestors spent several hours each day on Facebook and other social networks. By rendering the state television and radio stations irrelevant, they were able to undermine the regime's propaganda for the first time in many years.

Finally, on January 14, 2011, President Ben Ali was forced into exile. Later that month another popular uprising broke out in a different Middle Eastern and Arab country: Egypt. In 2010, Khaled Saied, a young man from Alexandria with no history of political activism, had been beaten to death by the police. Protesters rallied around a Facebook page entitled “We Are All Khaled Saied.” Mr. Saied's death became the focal point for Egyptians who had not been previously involved in the protest movement. Beginning on January 25, 2011, millions of protesters from a variety of backgrounds and religions demanded the overthrow of Egyptian President Hosni Mubarak, who had held office since 1981. >>> AN ATTEMPTED SOLUTION In an effort to silence the demonstrators and avoid the fate Tunisia's President Ben Ali, Mubarak “turned off the Internet.” At 12:34 AM on January 28, Egypt's four primary Internet providers — Link Egypt, Vodafone/Raya, Telecom Egypt, and Etisalat Misr — all went “dark.” That is, the four providers stopped transmitting all Internet traffic into and out of E gypt. The blackout appeared to be designed to disrupt the organization of the country's protest movement. >>> THE RESULTS “When countries block, we evolve,” an activist with the group We Rebuild wrote in a Twitter message on January 28. We Rebuild and othe r activist groups scrambled to keep the country connected to the outside world, turning to landline telephones, fax machines, and even ham radio to keep information flowing in and out of Egypt. The activists were successful. On February 2, Egypt's embattle d leaders realized that the communications blockage was largely ineffective and indeed counterproductive. The shutdown proved to be more of a source of fresh anger than an impediment to the protest movement.

Protesters had no trouble gathering larger and l arger crowds, culminating with an estimated 250,000 people who assembled in central Cairo on January 29 to demand an end to Mubarak's rule.

On February 11, following weeks of determined popular protest and pressures, Mubarak resigned from office. The Jasmi ne Revolution and Egyptian Revolution helped to instigate major uprisings throughout the Middle East and North Africa. By April 2011, Algeria, Bahrain, Iran, Jordan, Libya, Morocco, and Yemen had all experienced major protests, and minor incidents had occu rred in Iraq, Kuwait, Mauritania, Oman, Saudi Arabia, Somalia, Sudan, and Syria. Questions 1. Describe how information technology enabled the Jasmine and Egyptian Revolutions. 2. Describe efforts by the Tunisian and Egyptian governments to quell the revolutions. In particular, describe the efforts that were directed at information technology. 3. Discuss how information technology contributed to higher oil prices and higher prices you pay for gasoline. SOURCES: Compiled from J. Solomon and C. Levinson,” West to Isolate Gadhafi,” Wall Street Journal , February 26 –27, 2011; “ The Faces of Egypt's 'Revolution 2.0' ,” CNN.com , February 21, 2011; “ After Egypt, People Power Hits Like a Tsunami ,” CNN.com , February 15, 2011; “ Egyptian President Steps Down Amidst Groundbreaking Digital Revolution ,” CNN.com , February 11, 2011; C. Levinson, M. Coker, and J. Solomon, “How Cairo, U.S. Were Blindsided by Revolution ,” Wall Street Journal , February 2, 2011; P. McNamara, “ Egypt Lifts Blockade on Internet Service ,” Network World , February 2, 2011; V. Blue, “ #Egypt Blocked in China: Is Internet Acces s a Human Right? ” ZDNet.com , January 31, 2011; V. Walt, “ Tunisia's Nervous Neighbors Watch the Jasmine Revolution ,” Time , January 31, 2011; N. Gohring and R. McMillan, “ Without Internet, Egyptian s Find New Ways to Get Online ,”Computerworld , January 28, 2011; J. Robertson, “ The Day Part of the Internet Died: Egypt Goes Dark ,” USA Today , January 28, 2011; “ Tunisia's Revolution Should Be Wake -Up Call to Middle East Autocrats ,” Washington Post , Januar y 15, 2011. Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. CLOSING CASE 2 > L'Oréal Retools Its Information Systems >>> THE PROBLEM Headquartered in France, the L'Oréal Group ( www.loreal.com ) is the world's largest cosmetic and beauty products company. Concentrating on hair color, skin care, sun protection, makeup, perfumes, and hair care, the company is active in dermatology and pharmaceuticals. The company's philosophy is that everyone aspires to beauty, and its core mission is to help people around the world realize that aspiration. L'Oréal employs more than 67,000 people in 130 countries, and it supports 23 global brands. The firm's products are manufactured in more than 40 factories located around the world. The company has a tremendous challenge to produce high -quality, consistent products globally. It must ensure that all of its products are created with u niform production processes and quality control. By 2010 L'Oréal had come to realize that its current enterprise resource planning (ERP) system, based on software manufactured by SAP, could not support its goal of global product uniformity without consolid ating its many different information systems located around the world. For example, L'Oréal had multiple versions of SAP running in different regions and countries. As a result, the company used to take between two and five years to upgrade to the latest v ersion of SAP. L'Oréal also wanted to improve productivity, safety, and quality by standardizing the best -practice business processes throughout the firm. >>> THE SOLUTION To accomplish its mission, L'Oréal re-engineered its entire manufacturing process to work more efficiently while still supporting the quality and integrity of its brands. The company integrated its SAP ERP system with Apriso's ( www.apriso.com ) FlexNet for operations management. FlexNet is a unified set of manufacturing software applications that coordinate a company's manufacturing operations within a plant, between plants, and across an entire supply chain. The integrat ion of SAP and FlexNet resulted in a global, central IT system called the Integrated Solution for Industrial Systems (ISIS). ISIS consists of all the transactional applications, financial controls, and purchasing transactions integrated into the manufactur ing operations on the plant floor. FlexNet and ISIS support all factory processes — including production, quality assurance, and purchasing — while promoting L'Oréal's best practices. ISIS runs in L'Oréal's central data center in Montpellier, France, where the master data for the business are stored. FlexNet runs on servers located in individual factories so that each factory can continue operations in case a problem arises in the central data center. >>> THE RESULTS In its re -engineering process, L'Oréal imple mented a single, global instance of SAP and FlexNet, so the last upgrade took only one weekend. By upgrading so quickly, the firm was able to update its systems without disrupting its factories. The new software implementation also allows L'Oréal to bring factories online much more quickly. In the past, when L'Oréal acquired a factory, it took years to bring it online. In contrast, the new software enabled L'Oréal to integrate, in two months, an Yves St. Laurent factory that it had acquired, along with its quality assurance, safety, and efficiency practices. Every one of L'Oréal's manufacturing facilities handles thousands of different recipes for L'Oréal cosmetic products. Every ingredient must be tested for quality, and every worker must follow each recipe exactly. This demanding level of complexity can lead to human error, which can threaten quality, slow the workflow, and create waste. The new software guides the operators through each recipe and automatically records the weight of each ingredient to ensu re that the quantities are exactly correct. Once raw materials are tested for quality, they are given a label that the worker must scan before adding them to the recipe. This step ensures that all materials are tested. The labels also give forklift drivers directions as to which materials need to be taken to the packaging station. They also provide information on shelf life. Shop workers confirm that the new system is easy to use and has reduced confusion and stress. By deploying a single, global instance o f SAP and FlexNet, L'Oréal has increased its overall capacity, decreased its discrepancies in actual -versus -planned production, and reduced its wasted materials. As a result, the company is able to maintain lower, better -managed inventories at significant cost savings. Questions 1. Describe several reasons why L'Oréal needed to reengineer its information systems. 2. Describe the benefits of L'Oréal's new information systems. Explain how the benefits you describe are related to L'Oréal's strategic goals, using specific examples to support your arguments. SOURCES: Compiled from J. Playe, “ L'Oréal's Manufacturing Makeover ,” Baseline Magazine , January 28, 2011; “Business Process Management in Manufacturing ,” Aberdeen Research Report , January 20, 2011; M. Littlefield, “Business Process Management in Manufacturing: Paving the Way for Effective Collaboration ,” Aberdeen Research Report , November 30, 2010; M. Johnson, “ What's Happening with ERP Today ,” CIO , January 27, 2010; E. Lai, “ Micros oft Brings BI to the Cloud ,” Computerworld , April 30, 2009; www.loreal.com , www.apriso.com , accessed March 1, 2011. Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. RUBY'S CLUB INTERNSHIP ASSIGNMEN TS Ruben and Lisa are seriously considering integrating technology into their club. However, they still need a little convincing because of their lack of experience with computers. Right now, they only have one old computer that is still running Windows XP. Just last year, they finally decided to have cable Internet installed so they could place product orders more quickl y. Neither Ruben nor Lisa is on Facebook or Twitter. For now, Ruben and Lisa need to know what types of IS are available and what they can do with them. With the information in this chapter regarding the different types and uses of ISs, write a business le tter to Ruby's Club, detailing how the use of IS may help Ruben and Lisa manage their club on a day -to-day basis. Be sure to include information about the generation they serve and employ ( Homo conexus ) and how those people are already very connected and e xtremely comfortable with the use of computers and networks. Submit your letter to your instructor. Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. SPREADSHEET ACTIVITY Objective: You need to understand the possible application of a spreadsheet as much as how to perform specific tasks. It is the endless application of skills that make spreadsheets so powerful. This activity will show you that this tool can be used for a variety of situations and purposes. Chapter Connection: Data, information, and knowledge are the main focus of this chapter. Spreadsheets are just one of many tools (albeit the most widespread and easily accessible) that can be used to manage data, information, an d knowledge. Prerequisites: There are no prerequisites for this activity. Activity: As the text introduces the concepts of data , information , and knowledge , this activity will introduce you to the vast possibilities of using spreadsheets to help mana ge and control data. Unmanaged data will never provide information or knowledge, and so it is imperative to understand not only how to use a spreadsheet but the possibilities of when to use it. Consider the following three examples, and then develop your o wn ideas about how spreadsheets can be used. • Individual: Money is something everyone has to deal with. A spreadsheet is a great tool to help track and manage personal finances. Someone with a spreadsheet budget can quickly see where his or her money is being spent and make plans for where it will go in the future. With a little creativity and experience, one can quickly create a personal spreadsheet that will help track finances without purchasing a boxed program. • Organizations: It is still the simple things that make a big difference. Companies still seek better ways to manage inventory, and often these systems incorporate a spreadsheet. Many supply chain management tools will export data into spreadsheets for analysis. Once in a spreadsheet, charts and graphs can be used to easily display how inventory is being handled. • Society: Every 10 years, the U.S. government performs a census. Much of this information is available to the public. Mu ch interesting information can be gained by placing these data in a spreadsheet. Charts and graphs can be used to analyze population changes, employment rates, demographic information, and trends over time. Spreadsheets can be used to tell a story with thi s information. Having read these descriptions, describe to your professor three things about each example that a computer -based information system (in our case, a spreadsheet) would help. For example, you could say that a spreadsheet could help manage b ills (individual), keep up with sales (organizations), and determine average salaries for a given area (society). Think of two examples for each case, describe them, and submit your work to your professor. Deliverables: Students will write a paragraph demonstrating their own examples of the three areas already described in the activity. Follow up each application (individual, organizational, societal) with a description of the scenario that describes the business problem /need as well as the spreadsheet's answer. Quiz Questions: 1. Spreadsheets are useful to individuals (as opposed to organizations or society at large) for which of the following reasons? a. Tracking inventory b. Budgeting c. Tracking population changes d. All of the above 2. True or False: Spreadsheets are best kept in the world of mathematics and not applied to business problems. 3. Data are collected and placed in a spreadsheet and organized to help generate which of the following? a. Knowledge workers b. Engineers c. Information d. Wisdom 4. True or False: Raw facts in a spreadsheet are considered to be information. Discussion Questions: 1. For data to be turned into information, they often need to be cleaned, organized, calculated, and ultimately presented in some graphical format. Spreadsheets are excellent at all of these. Discuss three tools that help spreadsheets accomplish all of these goals. 2. Students have generated their own ideas for using spreadsheets. Be prepared to discuss your ideas with the class at large. Hopefully, you did not all come up with the same possibilities as other students, and this will help broaden their horizons even more. Suggested Solution: There is no suggested solution. There is no end to the possible applications of spreadsheet tools. This is the major point of this exercise. It does not teach you anything in particular (although you may learn something); it simply opens your eyes to see that this tool will apply to you sometime. Hopefully it will make things more real to you as you work through the following exercises. Copyright © 2012 John Wiley & Sons, Inc. All rights reserved. DATABASE ACTIVITY: INTRODUCTION TO THE DATABASE PROJECT Objective How to open and use an existing Access database, even if you've never done it before. Chapter Connection All aspects of modern information systems depend on shared databases. Being able to work with them is essential to any manager or knowledge worker of the twenty -first century. In this chapter, you saw how every department in a modern organization uses information systems. You saw how different dep artments use them differently: human resources staff in recruiting, marketing managers to select marketing channels, manufacturing coordinators to develop production schedules. Much of this information is not just for one part of the organization. Order in formation from sales, for example, goes to manufacturing (if you sell something, it must be produced), purchasing (materials come from suppliers), accounting (payments, adjustments to inventory values), and more.

Linking an organization through a shared da tabase is a major benefit of today's systems. These uses depend on data. You'll read more about that later in this book. However, it is never too early to start thinking about information systems in terms of the data they use.

Computers can only work with the data they have. Having the right data is vital to any IS. Prerequisites None. Activity: 1. Download the Ch 01 NeTrouble database from the Web site and double -click to open it. 2. Familiarize yourself with the parts of the Access window you see. The main ones are shown in Figure 1A.1 . (It is from a differen t database, but the window has the same parts.) The ribbon, A, provides tools to manipulate your database. The tools depend on the object you are working with and are organized into groups accessed via tabs (B). The tabs vary with object type, but there wi ll always be a Home tab at the left and a Create tab next to it. The arrangement of the icons on the ribbon depends on how much space Access has to spread them out. Vary the width of your window to see how they rearrange as it becomes narrower. (On most di splays it starts out wide enough for a full array, so making it wider will not change anything.) The sections stay the same, but some tools may lose their labels or disappear under an arrow indicating a pull -down menu when space is tight. The File tab, let ter C, controls the database as a file. You open, close, and save your work here. In Office 2007, this was done via the Office button. Prior releases used a File menu. The navigation pane, D, lists the objects in the current database. You can choose which types of objects it lists via the pull -down menu that opens when you click the down arrow to the right of “All Tables.” Each object type has its own icon. In the screen shot, the spreadsheets represent tables; the green booklets, reports. Usage Hint: If you see just “Navigation Pane” vertically at the left of the window, click on that text or the » above to expand it. The « at the top of the navigation pane in the screen shot shrinks the pane. That leaves more space for other items. The main part of the window, E, houses all open objects. The screen shot shows a data table.

Each object has a tab with its name at the top. Clicking a tab brings that object to the f ront. You probably do not see any open tables in your database yet. The navigation area, F, lets you move through individual records in a database. Here, it shows “1 in 6” corresponding to the highlighted first record of 6 in the table. Most Access objects can be manipulated in several views . A table, for example, has one view (Datasheet view) for reading and editing data, another (Design view) for designing the table itself. You can switch views by clicking the icon at the left of the ribbon (G), by pullin g down the menu there, or via the icons at the lower right of the window (also G). The Access window has two Close boxes (H). The one at the top right of the object area closes the object in front (here, the table TicketTbl). If other objects are open, one of them will now be in front. The Close box at the top right of the window closes the application and exits Access. (It prompts you to save unsaved work first.) Figure 1A.1 Microsoft Access: Screen shot 1. 3. Open UserTbl (short for “User Table”). How many records are in it? Usage Hint: Access can be set to open objects with a single or double click in the navigation pane. If you are using a personal copy, you can set this preference via Options under the File ribbon tab. Click Current Database, then Navigation Options. 4. Sort this table by date of birth: Click in the UserDOB column to select it, then click the top (A to Z) sorting icon in the Sort & Filter section under the ribbon. Who is the oldest user? How old is he or she? 5. Look at the UserDept (User Department) column of the User table. It does not have department names. Instead, it has numbers. The first user, Adam, is from Department 1. 6. Open DeptTbl (Department Table). What is the name of Department 1? 7. Open UserRpt (User Report). Adam is listed under that department. Access used his department number to connect his name in the user table with the department name in the department table. This is how relational databases link different types of data. How many users in the marketing department submitted network trouble tickets? After you find the answer, close the report. 8. Open UserFrm (User Form). You'll see information about the first user, Adam. In the navigation area at the bottom of the window, F in the figure, click on the far right icon to insert a new record. Enter reasonable data. For the user's department, pick any department from the list to the right of the legend “Select department.” What department did you pick?

Note the User ID number of your new user. Click the New Record icon again to save your work. Usage Hint: Access saves new data in the database as soon as you exit a record. Changes to the design of the database, however, are saved only upon command. 9. Now open TicketTbl . Click in the “New” row of the table. Do not enter anything in the first column; it will be filled automatically with the next number. In the next column, TicketUser, enter the number of the user you just created. In the next two columns, TicketDevice and TicketTech, fill in any numbers that are already used in the existing rows of the table. In the next two, enter any dates you want. (If you click on the calendar icon that appears when you select either of those fields, you can use a built -in calendar to select dates.) In the last column, enter any data you want. 10. Open UserRpt again. How many users are in that department now? Usage Hint: Reports are not automatically updated when data are changed. You have to close and reopen them. Usage Hint: The reason you created a ticket for your new user is that this report shows only users who have submitted trouble tickets. It could have been designed to show all users, whether or not they submitted tickets, but it was not. 11. Open UserQry (User Query) to find all users born after a certain date. Key in 6/6/1986 (June 6, 1986) and confirm. How many users were born after that date? Figure 1A.2 Microsoft Access: Screen shot 2. Deliverables :

Submit answers to the eight questions posed in the preceding activity. Steps not listed have no questions. In step 3: 1 question In step 4: 2 questions In step 6: 1 question In step 7: 1 question In step 8: 2 questions In step 11: 1 question Quiz Questions: 1. True or False? Access puts all the information about something of interest (such as an employee) into a single table. 2. Which of the following information items about a user is not given in UserTbl? a. The user's name b. The user's date of birth c. The user's telephone number d. The user's blood type 3. If you want to find out a user's age from UserTbl, which of the following is correct? a. There is insufficient information here to determine it. b. It can be found by subtracting the date of birth from today's date, dividing the difference in days by 365, and deleting any fractional remainder. c. It can be found by subtracting the date of hire from today's date, dividing the difference in days by 365, and deleting any fractional remainder. d. It can be found by asking the user or a member of his or her family. 4. The report you looked at in step 7 had all of the following elements, except: a. An overall header at the top, to identify it b. The number of trouble tickets submitted by each department, below the list of that department's employees c. The number of trouble tickets submitted by each department, above the list of that department's employees d. Detail rows with information about each user Discussion Questions: 1. In step 9 of this activity, you entered a birth date cutoff for the query. User input like this, which determines what data a query returns, is called a parameter . Now, suppose you want to book a round - trip on an air travel reservation system. List three p arameters you must enter into such a system before it can tell you about available flights. 2. The report you used in steps 7 and 8 of this activity included a summary field after each department. It was a simple summary: just a count of users in that department. Suppose this report also contained numeric data, such as user salaries. What other types of department summaries could you have? What other summaries, other than the employee count, could you possibly create from this table as it exists here? ( Be creative. Do not worry about whether or not it would make sense to create them. Just ask, Would it be possible?) 3. A university cafeteria checkout system reads the bar code on each item, looks it up in a table, and finds the product description and price. Using this information, it keeps track of the running total. At the end it calculates the total due and compares it to the student's account balance. If the balance is insufficient, it calls a supervisor. Otherwise, it subtracts the cost of the mea l from the balance and prints an itemized receipt showing the remaining balance. a. What tables does this database need? (One was mentioned in the description.) b. Using paper and pencil or any other tools your instructor specifies, draw the tables as in TicketT bl in the Figure 1A.1 . Show columns for all the data in them. Show a few sample rows. Also draw a sample itemized receipt as it might be printed for a student. For each different kind of data item on the receipt, say where it comes from: in the database or as the result of some other calculation. 4. The technician table ( TechTbl) lists all the technicians, with their names and other information such as their pay grade (job title). Describe in words how you could find, using the tables in this database, the names of all the users whose problems a given technician worked wit h. Use the process you have described to find all the users Nancy helped. Copyright © 2012 John Wiley & Sons, Inc. All rights reserved.