Introduction to Information Systems

Rainer, Prince, Sanchez-Rodriguez,

Splettstoesser Hogeterp, Ebrahimi
Fifth Canadian Edition

Chapter 1

Introduction to Information Systems

Copyright ©2021 John Wiley & Sons Canada, Ltd.

Learning Objectives

• Identify why being an informed user of information

systems is important in today’s world
• Describe the various types of computer-based information
systems in an organization
• Discuss ways in which information technology can affect
managers and nonmanagerial workers
• Identify positive and negative societal effects of the
increased use of information technology

Copyright ©2021 John Wiley & Sons Canada, Ltd. 2

Chapter Outline

1. Why Should I Study Information Systems?

2. Overview of Computer-Based Information Systems
3. How Does IT Impact Organizations?
4. Importance of Information Systems to Society

Copyright ©2021 John Wiley & Sons Canada, Ltd. 3

Opening Case: The Digital Transformation of the
Canadian Imperial Bank of Commerce

Think about:
• How do you use technology when you do your banking or
make payments?
• How has technology helped your financial institution?

Copyright ©2021 John Wiley & Sons Canada, Ltd. 4

1.1 Why Should I Study Information Systems?

• The Informed User—You!

• IT Offers Career Opportunities
• Managing Information Resources

Copyright ©2021 John Wiley & Sons Canada, Ltd. 5

The Informed User—You!

1. You benefit more when you understand what is “behind”

IT applications
2. You can provide valuable input
3. You can recommend and help select IT applications
4. You will be aware of new technology
5. You understand how IT improves performance
6. Understanding IT is beneficial to entrepreneurs

Copyright ©2021 John Wiley & Sons Canada, Ltd. 6

Digital Transformation

• Organizations that you work with will be continually

undertaking digital transformation: the business strategy
that leverages IT to dramatically improve employee,
customer, and business partner relationships
• New technologies that enable digital transformation
include: big data, social computing, cloud computing,
artificial intelligence, and more

Copyright ©2021 John Wiley & Sons Canada, Ltd. 7

FIGURE 1.1 MIS provides what users
see on their computer screens
FIGURE 1.1 MIS provides what users see and use on their computers.

Copyright ©2021 John Wiley & Sons Canada, Ltd. 8

IT’s About Business 1.1:
A Variety of Digital Transformations
Consider:
• How digital transformation is changing business
relationships
• How those changes increase organizational agility to
respond to circumstances; e.g., physical isolation
requirements imposed in 2020 due to the COVID-19
pandemic

Copyright ©2021 John Wiley & Sons Canada, Ltd. 9

IT Offers Career Opportunities

• IT is vital to modern businesses, providing many lucrative

career opportunities that include:
o Programmers, business analysts, systems analysts, and
designers
o Chief information officer (CIO)—executive in charge of the
IS function
• Career opportunities will remain strong in the future

Copyright ©2021 John Wiley & Sons Canada, Ltd. 10

Top Job Rankings: Canadian Business
(out of 100, 2019)
• #26 Computer Systems Manager
• #46 Software Engineer
• #54 Database Analyst
• #56 Computer Engineer

Copyright ©2021 John Wiley & Sons Canada, Ltd. 11

Top Job Rankings: MSN (out of 20,
2019)
• #2 Software Engineer
• #8 IT Project Manager

Copyright ©2021 John Wiley & Sons Canada, Ltd. 12

Top Job Rankings: Forbes (out of 20,
2019)
• #2 Software Engineer
• #4 IT Manager
• #11 IT Manager
• #13 Data Engineer
• #14 Front-End Engineer (User Experience Designer)

Copyright ©2021 John Wiley & Sons Canada, Ltd. 13

Managing Information Resources

• Managing information resources is difficult and complex

because:
o ISs have an enormous strategic value to organizations
o ISs are very expensive to acquire, operate, and maintain
• Evolution of the MIS function within the organization

Copyright ©2021 John Wiley & Sons Canada, Ltd. 14

Factors Affecting Responsibility For
Managing Information Resources
• MIS personnel vs. end users
• Changing role of the IS department
o Traditional functions of the MIS department
o New (consultative) functions of the MIS department
facilitate informed user involvement

Copyright ©2021 John Wiley & Sons Canada, Ltd. 15

Traditional Function of the MIS
Department
• Managing systems development and systems project
management
• Managing computer operations
• Staffing, training, and developing IS skills
• Providing technical services
• Infrastructure planning, development, and control

Copyright ©2021 John Wiley & Sons Canada, Ltd. 16

New (Consultative) Functions of the
MIS Department (1 of 2)
Consultative MIS Department Role Informed End User Role
Initiating and designing specific strategic IT steering committee mandates
information systems development of new strategic information
systems
Incorporating the Internet and e-commerce Responsible for effective use of the Internet
into the business and e-commerce
Managing system integration of the Describe business needs and the type of
Internet, intranets, and extranets integration that is required
Educating non-MIS managers about IT Advise the MIS department about your
employees’ training needs
Educating the MIS staff about the business Communicate business needs, requirements
and goals

Copyright ©2021 John Wiley & Sons Canada, Ltd. 17

New (Consultative) Functions of the
MIS Department (2 of 2)
Consultative MIS Department Role Informed End User Role
Partnering with business unit executives Responsible for defining and clarifying your
roles in alignment with the MIS department
roles and organizational strategy
Managing outsourcing Identify outsourcing requirements for your
functional area with the assistance of MIS
department advice
Proactively using business and technical Partner with the MIS department to target
knowledge to see innovative ideas about high-priority business needs and use
using IT innovative solutions
Create business alliances with business Identify supply chain or other inter-
partners organizational business requirements

Copyright ©2021 John Wiley & Sons Canada, Ltd. 18

1.2 Overview of Computer-Based
Information Systems
• Data, information, knowledge
• IT infrastructure
o IT components
o IT personnel
o IT services

• Types of computer-based information systems

Copyright ©2021 John Wiley & Sons Canada, Ltd. 19

FIGURE 1.2 Data, information, and
knowledge
FIGURE 1.2 Data, information, and knowledge.

Copyright ©2021 John Wiley & Sons Canada, Ltd. 20

FIGURE 1.3 Computer-based
information systems
FIGURE 1.3 Computer-based information systems consist of hardware,
software, databases, networks, procedures, and people.

Copyright ©2021 John Wiley & Sons Canada, Ltd. 21

Computer-Based Information System
(CBIS)
Six basic components:
• Four information technology (IT) components: hardware,
software, database, network
• Two non-IT components: procedures, people

Copyright ©2021 John Wiley & Sons Canada, Ltd. 22

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

Copyright ©2021 John Wiley & Sons Canada, Ltd. 23

Types of Computer-Based Information
Systems
• Breadth of support of ISs
• Support for organizational employees

Copyright ©2021 John Wiley & Sons Canada, Ltd. 24

Breadth of Support of Information
Systems (1 of 3)
• Functional Area Information Systems (FAIS), also known
as a departmental information system:
o Human resources (HR)
o Accounting
o Finance
o Marketing
o Production/operations

Copyright ©2021 John Wiley & Sons Canada, Ltd. 25

FIGURE 1.4 IT inside your organization
FIGURE 1.4 Information technology inside your organization.

Copyright ©2021 John Wiley & Sons Canada, Ltd. 26

Breadth of Support of Information
Systems (2 of 3)
• Two information systems support the entire organization:
o Enterprise Resource Planning (ERP) systems
• Provide communication among functional area ISs through an
integrated database
o Transaction Processing Systems (TPS)
• Support the monitoring, collection, storage, and processing of
data from the organization’s day-to-day operations for basic
business transactions

Copyright ©2021 John Wiley & Sons Canada, Ltd. 27

Breadth of Support of Information
Systems (3 of 3)
• Interorganizational Information Systems (IOS)
o Support many interorganizational operations
o Examples include:
• Supply chain management (SCM) systems
• Electronic commerce (e-commerce) systems

Copyright ©2021 John Wiley & Sons Canada, Ltd. 28

FIGURE 1.5 Information systems that
function among multiple organizations
FIGURE 1.5 Information systems that function among multiple
organizations.

Copyright ©2021 John Wiley & Sons Canada, Ltd. 29

IT’s About Business 1.2:
TRIEC Helps Canada Newcomers Find a Job
Consider:
• How can technology support a mentor for you in your
future careers?
• How is your online education supported by email systems?

Copyright ©2021 John Wiley & Sons Canada, Ltd. 30

Support for Particular Organizational
Employees
All types of workers require support from information
systems:
• Clerical workers, managers, knowledge workers
The systems that support them are called:
• Functional area information systems (FAIS)
• Business analytics (BA) and business intelligence (BI)
• Expert systems (ES)
• Dashboards (aka digital dashboards)

Copyright ©2021 John Wiley & Sons Canada, Ltd. 31

TABLE 1.4 Types of Organizational
Information Systems
Type of System Function Example
Transaction processing system Processes transaction data from terminal Walmart checkout point-of-sale business events

Enterprise resource planning Integrates all functional areas of the Oracle, SAP system
organization
Functional area IS Supports the activities within specific System for processing payroll
functional area
Decision support system Provides access to data and analysis “What-if” analysis of changes in budget
tools
Expert system Mimics human expert in a particular area Credit card approval analysis
and makes decisions
Dashboards Present structured, summarized Status of sales by product
information about aspects of business
important to executives
Supply chain management Manages flows of products, services, and Walmart Retail Link system connecting
system information among organizations suppliers to Walmart
Electronic commerce system Enables transactions among www.dell.com
organizations and between organizations
and customers

Copyright ©2021 John Wiley & Sons Canada, Ltd. 32

1.3 How Does IT Impact Organizations?

• IT Impacts Entire Industries

• IT Reduces the Number of Middle Managers
• IT Changes the Manager’s Job
• Will IT Eliminate Jobs?
• IT Impacts Employees at Work

Copyright ©2021 John Wiley & Sons Canada, Ltd. 33

IT Impacts Entire Industries: Examples
(1 of 2)
• Book industry
• Music industry
• Video industry
• Software industry
• Video game industry
• Photography industry
• Marketing
• Recruiting

Copyright ©2021 John Wiley & Sons Canada, Ltd. 34

IT Impact Impacts Entire Industries
Examples (2 of 2)
• Financial services
• Motion picture industry
o DreamWorks Animation
• Automobile industry
• Agriculture
• Fashion
• Education
• Legal profession

Copyright ©2021 John Wiley & Sons Canada, Ltd. 35

IT Reduces the Number of Middle
Managers
• Makes middle managers more productive
• IT increases the number of employees reporting to a single
manager, so IT reduces the number of middle managers
required

Copyright ©2021 John Wiley & Sons Canada, Ltd. 36

IT Changes the Manager’s Job

• Decision making is the most important managerial task

• IT changes the way managers make decisions
o IT provides near real-time information
o Managers have less time to make decisions
o IT provides tools for analysis to assist in decision making
and in handling high volumes of information

Copyright ©2021 John Wiley & Sons Canada, Ltd. 37

Will IT Eliminate Jobs?

• The competitive advantage of replacing people with IT and

machines is increasing rapidly
• Increasing the use of IT in business also:
o Creates new job categories
o Requires more employees with IT knowledge and skills

Copyright ©2021 John Wiley & Sons Canada, Ltd. 38

IT Impacts Employees’ Health and
Safety
• Increased job stress
• Long-term use of the keyboard and mouse can result in
repetitive strain injuries (RSI)

Copyright ©2021 John Wiley & Sons Canada, Ltd. 39

FIGURE 1.6 Ergonomic products
protect computer users
FIGURE 1.6 Ergonomic products protect computer users.

Copyright ©2021 John Wiley & Sons Canada, Ltd. 40

IT Provides Opportunities for People
with Disabilities
• Speech-recognition for employees unable to type due to
physical impairment
• Audible screen tips for employees who are visually impaired

Copyright ©2021 John Wiley & Sons Canada, Ltd. 41

1.4 Importance of Information Systems
to Society
• IT Affects Our Quality of Life
• The Robot Revolution Is Here Now
• IT Impacts Health Care
• The Emergence of Cognitive Computing: IBM Watson

Copyright ©2021 John Wiley & Sons Canada, Ltd. 42

IT Affects Our Quality of Life

• IT has changed the way we work

o Smartphones provide constant access to text, email, and
voice communications
o The lines between time at work and leisure time at home
have become blurred
o Surveys indicate employees take laptops and smartphones
on vacation

Copyright ©2021 John Wiley & Sons Canada, Ltd. 43

The Robot Revolution is Here Now

• Baxter
• LoweBots
• Drones
• Autonomous vehicles

Copyright ©2021 John Wiley & Sons Canada, Ltd. 44

IT’s About Business 1.3:
Diverse Uses for Drones
Consider:
• How are drones and robots helping with our food supply?
• How could drones help reduce crime in your area, town, or
city?

Copyright ©2021 John Wiley & Sons Canada, Ltd. 45

IT Impacts Health Care

• IT is used in health care to:

o Make better and faster diagnoses
o Streamline the process of researching and developing new
drugs
o Enhance the work of radiologists
o Allow surgeons to use virtual reality to plan complex
surgeries, and use robots to remotely perform surgery

Copyright ©2021 John Wiley & Sons Canada, Ltd. 46

The Emergence of Cognitive
Computing: IBM Watson
• IBM’s Watson is an example of artificial intelligence (AI)
called cognitive computing. Watson:
o Understands natural language
o Learns and absorbs information to formulate hypotheses
o Has the ability to understand the context of a question
• In health care Watson helps fine-tune diagnoses and
treatment protocols
• Watson is being used in other areas including: customer
service, financial services, tax preparation services, and
strategic analysis

Copyright ©2021 John Wiley & Sons Canada, Ltd. 47

Closing Case: John Deere Becomes a Technology
Company and It Is Not All Good News

Think about:
• Technology has helped farmers work more precisely with
their crops and with other partners: how much could that
be worth?
• Should software maintenance for any product be “locked
in” to specific suppliers or more readily accessible?

Copyright ©2021 John Wiley & Sons Canada, Ltd. 48

Copyright
Copyright © 2021 John Wiley & Sons Canada, Ltd. or the author. All rights
reserved. Students and instructors who are authorized users of this course are
permitted to download these materials and use them in connection with the
course. No part of these materials should be reproduced, stored in a retrieval
system, or transmitted, in any form or by any means, electronic, mechanical,
photocopying, recording or otherwise, except as permitted by law. Advice on
how to obtain permission to reuse this material is available at
http://www.wiley.com/go/permissions.

Copyright ©2021 John Wiley & Sons Canada, Ltd. 49