1 Information Technologies: Concepts and Management

Objectives
Describe various information technologies and systems and their

evolution, and categorize specific systems
Describe and compare transaction processing systems and functional information systems
Identify the major internal support systems and relate them to managerial procedures.
Describe the support IT provides along the supply chain, including CRM and SCM.
Describe the major types of Web-based information systems and understand their functionalities.
Describe new computing environments.
Describe how well information resources in a company are managed and what are the roles of the IT Department and end users

analyzes, and disseminates information for a specific purpose - “Application”.

and transactions that are recorded, classified, and stored, but not

organized to convey any specific problem
Information
Data that has been organized so that they have meaning and value to the spеscific organizational task
Knowledge
Information that has been organized and processed to convey understanding, experience and expertise as they apply to a current problem or activity

Collects data, processes it into information then converts information into knowledge for a specific purpose.

information system (IS) can span departments, business units and corporations.
Information

systems are usually connected by means of electronic networks

An information system (IS) support each department in a corporation.
Transaction

Processing Systems (TPS): Automates routine and repetitive tasks that are critical to the operation of the organization

Point-of-Sale (POS)

support each department in a corporation.

System
Decision Support System
Intelligent Support Systems
Knowledge Management System
Office Automation System
Transaction Processing

System

5-year sales trend
Profit Planning
5-year budget forecasting
Product development

Sales Management
Inventory Control
Annual budget
Production Scheduling
Cost Analysis
Pricing Analysis

Simulation
Pgm coding
System support
Word Processing
Desktop Publishing

Order Processing
Fulfillment
Material Movement
A/R, A/P, GL
Payroll
POS

repetitive tasks that are critical to the operation of the

organization, such as preparing a payroll, billing customers, Point-of-Sale and Warehouse operations.
data collected from this operation supports the MIS and DSS systems employed by Middle Management
computerizes the primary and most of the secondary activities on the Value Chain.
Primary purpose - to perform transactions and collect data.

information for supporting current decision making in the functional areas.

Geared toward middle managers, MIS are characterized mainly by their ability to produce periodic reports such as a daily list of employees and the hours they work, or a monthly report of expenses as compared to a budget limits
Typical uses would be in Completion , Pricing Analysis (Markdowns) and Sales Management
Decisions supported are more structured.
Primary purpose - to convert data into information

to convert data into information and knowledge
DSS systems are typically

employed by tactical level management whose decisions and “what-if” analysis are less structured.
This information system not only presents the results but also expands the information with alternatives.
Some DSS methodologies :
Mathematical Modeling
Simulation Modelling
Queries
What-If (OLAP-Cubes)
Data mining
Fuzzy logic

intelligent problem solving.
One application of AI is expert systems.

Expert systems (ES) provide the stored knowledge of experts to managers, so the latter can solve difficult or time-consuming problems. These advisory systems differ from TPS, which centered on data, and from MIS and DSS, which concentrated on processing information. With DSS, users make their decisions according to the information generated from the other systems. With ES, the system makes recommended decisions for the users based on the built-in expertise and knowledge.

what is now known as an office automation system (OAS).

Other aspects include word processing systems, document management systems and desktop publishing systems.
OAS systems are predominantly used by clerical workers who support managers at all levels. Among clerical workers, those who use, manipulate, or disseminate information are referred to as data workers.

originally were implemented to support Senior management. These systems have

been expanded to support other managers within the enterprise.
At the senior management level they support Strategic decisions which deal with situations that significantly may change the manner in which business is done

exists between top and middle management. These are professional people,

such as financial and marketing analysts that act as advisors and assistants to both top and middle management. They are responsible for finding or developing new knowledge (External Content) for the organization and integrating it with existing knowledge (Internal Content).
KMS that support these knowledge workers range from Internet search engines and expert systems, to Web-based computer-aided design and sophisticated data management systems

suppliers and their suppliers
Internal supply chain
includes all the processes used

by an organization in transforming the inputs of the suppliers to outputs
Downstream supply chain
includes all the processes involved in delivering the products to final customers

Components of the Supply Chain

A supply chain is a concept describing the flow of materials, information, money, and services from raw material suppliers through factories and warehouses to the end customers.

Chain

organizations. These systems are common among business partners and play

a major role in e-commerce, as well as in supply chain management support.
The first type of IT system that was developed in the 1980s to improve communications with business partners was electronic data interchange (EDI), which involved computer-to-computer direct communication of standard business documents (such as purchase orders and order confirmations) between business partners. These systems became the basis for electronic markets, that later developed to electronic commerce systems.
Web-based systems (many using XML) deliver business applications via the Internet. Using browsers and the Internet, people in different organizations communicate, collaborate, access vast amounts of information, and run most of the organization’s tasks and processes.

Computing Environment
Client/server Environment
Enterprise-wide Computing Environment
Legacy systems
A common way to

classify information architecture is by computing paradigms, which are the core of the architecture.

to those applications or services that are resident on a

server that is accessible using a Web browser. The only client-side software needed to access and execute these applications is a Web browser environment.

Electronic Storefronts
Electronic Markets
Electronic Exchanges
M-Commerce
Enterprise Web

worldwide system of computer networks—a network of networks hence Internet,

in which users at any one computer can get information from any other computer
The Internet uses a portion of the total resources of the currently existing public telecommunication networks. Technically, what distinguishes the Internet is its use of a set of protocols called TCP/IP (Transmission Control Protocol/Internet Protocol).

a private network, usually within one enterprise.
It is typically a

complete LAN, or several intra-connected LANs
Intranets are used for:
work-group activities
the distributed sharing of projects within the company
Controlled access to company financial documents
use of knowledge management, research materials, online training, and other information that requires distribution within the company.

mechanism and some additional functionalities
They form a larger virtual network

that allows remote users (such as business partners or mobile employees) to securely connect over the Internet to the enterprise’s main intranet.
Extranets are also employed by two or more enterprises (suppliers & buyers) to share information in a controlled fashion, and therefore they play a major role in the development of business-to-business electronic commerce and Supply Chain systems.

information from a remote access. They aggregate information and content

from many files and present it to the user.
Corporate portals also are used to personalize information for individual customers and for employees.
Intranets and Extranets are usually combined with and accessed via a corporate portal

conducted seamlessly twenty-four hours a day, seven days a week
Some

classifications of E-commerce systems are:
B2C (Business to Consumer)
B2B (Business to Business)
B2E (Business to Employee)
The major components of Web-based EC are:
Electronic storefronts
Electronic markets
Mobile commerce

the electronic storefront, an e-business can display and/or sell its

products.
The storefront may include electronic catalogs that contain descriptions, graphics, and possibly product reviews.
They have following common features and functions:
an E-catalog
a shopping cart
a checkout mechanism
a payment processing feature
a back office order fulfillment system

over which information, products, services, and payments are exchanged. It

is equivalent to a physical marketplace except is Web-based.
The principal participants in marketplaces are: transaction handlers, buyers, brokers, and sellers.
The means of interconnection vary among parties and can change from event to event, even between the same parties. Electronic markets can reside in one company, where there is either one seller and many buyers, or one buyer and many sellers. These are referred to as private marketplaces.

are Web-based public marketplaces where many buyers and many sellers

interact dynamically.
Originally set as trading places for commodities, electronic exchanges have emerged for all kinds of products and services

(buying and selling of goods and services) in a wireless

environment, such as through wireless devices like cellular telephones and tablets.
M-commerce enables users to access the Internet without needing to find a place to “plug” in their device.
As this wireless environment expands, a pervasive computing environment will develop, employed by mobile employees and others, will change the way business is transacted.

Web applications. It combines services from different vendors in a

technology layer that spans rival platforms and business systems, creating a foundation for building applications at a lower cost.
Applications, including business integration, collaboration, content management, identity management, and search, which work together via integrating technologies.
The result is an environment that spans the entire enterprise.

as available, reliable, and secure as electricity, water services, and

telephony. The vision behind utility computing is to have computing resources flow like electricity on demand from virtual utilities around the globe—always on and highly available, secure, efficiently metered, priced on a pay-as-you-use basis, dynamically scaled, self-healing, and easy to manage.
Subscription Computing is a form of utility computing that puts the pieces of a computing platform together as services, rather than as a collection of separately purchased components.
Grid Computing employs networked systems to harness the unused processing cycles of all computers in that given network thus creating powerful computing capabilities. Grid computing is already in limited use, for example the well-known grid-computing project SETI (Search for Extraterrestrial Intelligence) @Home project. In this project, PC users worldwide donate unused processor cycles to help the search for signs of extraterrestrial life by analyzing signals coming from outer space.
Pervasive Computing, a future in which computation becomes part of the environment. Computation will be embedded in things, not in computers. (Internet of Things)
Web services are self-contained, self-describing business and consumer modular applications, delivered via the Internet, that users can select and combine through almost any device, ranging from PC to mobile phones.

so when they are not working even for a short

time, an organization cannot function. Furthermore, the Life Cycle Costs (acquisition, operation, security, and maintenance) of these systems is considerable. Therefore, it is essential to manage them properly. The planning, organizing, implementing, operating, and controlling of the infrastructures and the organization’s portfolio of applications must be done with great skill.
The responsibility for the management of information resources is divided between two organizational entities:
The information systems department (ISD), which is a corporate entity
the end users, who are scattered throughout the organization.

a networked-computing-based e-business may be a complicated process. The e-business

requires a client/ server architecture, an intranet, an Internet connection, and e-commerce policy and strategy, all in the face of many unknowns and risks. However, in many organizations this potentially painful conversion may be the only way to succeed or even to survive. When to do it, how to do it, what the role of the enabling information technologies will be, and what the impacts will be of such a conversion are major issues for organizations to consider.
From legacy systems to client/server to intranets, corporate portals, and Web-based systems. A related major issue is whether and when and how to move from the legacy systems to a Web-based client/server enterprise-wide architecture. While the general trend is toward Web-based client/server, there have been several unsuccessful transformations, and many unresolved issues regarding the implementation of these systems. The introduction of intranets seems to be much easier than that of other client/server applications. Yet, moving to any new architecture requires new infrastructure and a decision about what to do with the legacy systems, which may have a considerable impact on people, quality of work, and budget. A major aspect is the introduction of wireless infrastructure.
How to deal with the outsourcing and utility computing trends. As opportunities for outsourcing (e.g., ASPs) are becoming cheaper, available, and viable, the concept becomes more attractive. In the not-so-distant future, we will see outsourcing in the form of utility computing. How much to outsource is a major managerial issue.