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General Introduction
Lecturer: Felix Amponsah-Kubi. Regent University 3
What is Information?
Data are facts that are entered, stored, and processed by an Information System.
Information in turn is organised, meaningful, and useful data.
Lecturer: Felix Amponsah-Kubi. Regent University 4
Value of Information?
The Value of Information is the benefit produced by the information minus the cost of producing it.
Value of Information?
1. Major Benefits:
i. Improved decision making ii. Better ability to plan activities iii. Better ability to schedule activities iv. Reduce uncertainty
Value of Information?
2. Costs: Time and resources expended in
i. Capturing, ii. Processing, iii. Storing, iv. Reporting/Retrieving, v. Updating, and vi. Controlling the information
Lecturer: Felix Amponsah-Kubi. Regent University 7
Value of Information?
The costs and especially the benefits of information are difficult to quantify. It is difficult to determine the value of information before it has been produced and utilised. Nevertheless, the expected value of information should be calculated as effectively as possible so that the costs associated with the information do not exceed its Benefits.
Information Overload
Information Overload is state where additional information cannot be used efficiently and has no marginal value. It is costly in that decision-making performance decreases while the costs associated with providing the information increase.
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Types of IS:
1. Executive Information Systems (EIS): Developed to provide
executives and managers with easyto-understand access to the information they need to make strategic plans, monitor business and economic conditions, identify business problems and opportunities, and make decisions.
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Types of IS:
2. Decision Support Systems (DSS):
Developed to help users make decisions in instructed environments where there is a high degree of uncertainty and illdefined reporting requirements. It allows users to explore alternatives, ask what-if questions, deal with changing business situations and make decisions in unanticipated situations
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Types of IS:
3. Expert Systems (ES): They contain
knowledge and expertise of one or more specialists in a well-defined area. An expert system guides decision processes, produces more consistent decisions, and ensures that important decision criteria are considered.
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Types of IS:
4.End-User Systems(EUS): Developed by users to meet their own information retrieval, personal productivity, and application development needs.
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1. Operational Excellence: This improves the efficiency of their operations in order to achieve higher profitability especially when coupled with changes in business practices and management behaviour.
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are a major enabling tool for businesses to create new products and services as well as entirely new business model. A business model describes how a company produces, delivers, and sells a product or service to create wealth.
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With the right Information Systems in place, management should ask themselves questions like: 1. Why do some businesses do better than others? 2. How do they achieve competitive advantage? 3. How do we analyse our business and achieve strategic advantages? 4. Importantly how do Information Systems contribute to strategic advantages?
Lecturer: Felix Amponsah-Kubi. Regent University
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Competitive Forces
Michael Porters Classic Model of Competitive Forces: Businesses develop and implement strategies to effectively counter the Competitive Forces that shape the fate of the business in order to survive and succeed. Porters model provides a general view of the business, its competitors, and the businesss environment.
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Competitive Forces
Michael Porters Classic Model of Competitive Forces: 1. The Rivalry of Competitors within the Industry (Traditional Competitors): These are the competitors who share the market space with the business and are continuously devising new business models. Competitors share natural, and often healthy, rivalry. This force requires significant resource, especial very modern information systems on the part of the business to stay in the competition.
Lecturer: Felix Amponsah-Kubi. Regent University 42
Competitive Forces
Michael Porters Classic Model of Competitive Forces: 2. Threat of Potential New Entrants: In a free economy with mobile labour and financial resources, new companies are always entering the marketplace. The extent of this threat depends on how easily they can overcome barriers to entry.
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Competitive Forces
Michael Porters Classic Model of Competitive Forces: 3. Substitute Products and Services: These refer to products and services in other industries that can perform the same function. E.g. using cans instead bottles. 4. Buyers/ Customers: Seek lower prices or higher quality at constant prices, thus forcing down prices and profitability especially where the buyer buys a large chunk of product and there are many other suppliers on the market.
Lecturer: Felix Amponsah-Kubi. Regent University 44
Competitive Forces
Michael Porters Classic Model of Competitive Forces: 5. Suppliers: When suppliers bargaining power gets too strong, they can drive prices and starve the business of parts or raw materials essential to production.
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In businesses where major strategic decision makers do not recognise Information System as a means of creating core competences and advantages, growth, survival and success become stifled.
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Senior management needs to be involved in critical Information Systems decision making to optimise the business value and performance of the IS function. Critical Questions include: i. How much do we spend on IS? ii. Which business processes should have IS iii. Which IS capabilities need to be companywide? iv. How much do we invest in training and developing employee to use the businesss IS
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v. How good do our IS need to be? vi. What security and privacy risks will we accept?
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Managers also need to consider a wide range Of Costs (i.e. the Total Cost of Ownership TCO) that will include: i. Acquisition cost ii. Ongoing Administration cost iii. Maintenance cost iv. Technical Support cost v. System Upgrading cost vi. Employee Training cost vii. Cost of housing the Information Systems
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TOPIC
Elements and Procedures of IS
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Information Need for business activities Information Systems are basically developed to provide opportunities to improve system efficiency and effectiveness
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Three (3) basic functions performed by IS 1) To collect and process data about the organisation's business activities efficiently and effectively
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Three (3) basic functions performed by IS 2) To provide information useful for decision making
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defined as a graphical diagramming tool that uses a few simple symbols to illustrate the flow of data among external entities, processing activities, and data storage elements. (OBrien, 2008)
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can be
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Symbols
DATA FLOW DIAGRAM SYMBOLS Name Explanation Data sources and destinations Data flows
Transformation processes
Data stores
The people & organisations that send data to and receive data from the system are represented by square boxes The flow of data into or out of a process is represented by curved or straight lines with arrows The processes that transform data from inputs to outputs are represented by circles. They are often referred to as bubbles The storage of data is represented by two horizontal lines.
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Guidelines for Drawing a DFD 2)Determine System Data Flows and Relationships: This step
emphasises actual versus expected data flows and relationships. It is usually best to construct a DFD by concentrating first on data flows, rather than on processes or data stores. Where the data originates and its final destination should be identified. Circles should be placed wherever work is required to transform from one data flow into another.
Lecturer: Felix Amponsah-Kubi. Regent University 65
Guidelines for Drawing a DFD Label DFD Elements Naming Guidelines (contd)
i. First name all DFD elements ii. Make sure the names describe all the data or the entire process iii. Avoid names that are not fully descriptive. E.g. Input Data or Update Processes but use names like Daily Inventory; Validate Transaction iv. Never combine unrelated items
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Credit Manager
Update Receivables
Process Payment
Customer
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Guidelines for Drawing a DFD 4)Data Stores: It is a temporary or permanent repository of data
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Guidelines for Drawing a DFD 5)Data Dictionary: It contains a description of all the data elements, stores and flows in a system, including the storage and processing of data, the documents, and physical items and their interrelationships.
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execution of systematic sequence of operations performed upon data to transform them into information.
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Flowcharts
Flowchart : It is an analytical technique
used to describe some aspect of an Information system in a clear, concise, and logical manner. Flowcharts use a standard set of symbols to describe pictorially the business activity procedures used by a company and the flow of data through a system.
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Flowcharts
Flowchart (contd): Each symbol
has a special meaning that is easily conveyed by its shape. The shape indicates and describes the operations performed and the input, output, processing media employed.
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Input/Output Symbols
Document Symbol Display Symbol
On-Line Keying
Input/Output Symbol
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Processing Symbols
Computer Processing
Off-line Keying Operation
Manual Operation
Auxiliary Operations
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Storage Symbols
Magnetic Disk
On-Line Storage
Magnetic Tape
File (N)
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Document Flowchart
It illustrates the flow of documents and Information between areas of responsibility within an organisation. Document flowcharts trace a document from its cradle to its grave. It shows where each document originates, its distribution, the purposes for which it is used, its ultimate disposition, and everything that happens as it flows through the system. It is yseful in analysing the adequacy of control procedures in a system.
Lecturer: Felix Amponsah-Kubi. Regent University 83
Systems Flowchart
It depicts the relationship among the input, processing, and output of an Information System. A system flowchart begins by indentifying both the inputs that enter the system and their origins. The input can be new data entering the system, data stored for future use, or both. The input is followed by the processing portion of the flowchart, the steps performed on the data. System flowcharts are important tool of systems analysis, design, and evaluation.
Lecturer: Felix Amponsah-Kubi. Regent University
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Programme Flowchart Illustrates the sequence of logical operations performed by a computer in executing a programme.
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Decision Table
It is a tabular representation of decision logic. For any given situation a decision table lists all the conditions (the ifs) that are possible in making a decision. It also lists the alternative actions (the thens) as well. Each unique relationship (if this condition exists, then take this action) is referred to as decision rule.
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City Shop
Atlantic Ltd
Aspect Bros.
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Decision Table
A decision table has four parts: i. The Condition Stub: Which contain contains the various logic conditions for which the input data are tested. ii. The Action Stub: Contains the actions the programme should take. E.g. Reject the order, back-order, fill the order, or give a discount
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Decision Table
A decision table has four parts: iii. The Condition Entry: Consists of a set of vertical columns, each representing a decision rule in which the entries must be either yes (Y) or no (N), or a dash (--). The dash indicates an indifferent result of the condition set. E. g. When credit is not approved, the quantity or inventory on hand is not relevant. iv. The Action Entry: Indicates when an action is to occur. They display an X if the action is performed (if the input data meet the condition tests. A blank indicates the action is not performed.
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5) Legal/Political Feasibility:
a) Copyright is a statutory grant that protects creators of intellectual property against copying by others for any purpose for a minimum of 70 years. patent infringements: anti-trust laws: (Microsoft in 1998)
b) c)
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High Risk
Automation
Rationalisation
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Organisational Change Model: Risks and Rewards 4) Paradigm Shift: This involves
rethinking the nature of the business, defining a new business model, and often changing the very nature of the organisation. New IS can ultimately affect the design of entire organisation by transforming how the organisation carries out its business. E.g. MMM changing from metal works to post-it paper manufacturing.
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Understand the Business Problem or Lecturer: Felix Amponsah-Kubi. Regent University Opportunity (Feasibility Studies)
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a) b) c) d)
Define the problem Identify its causes, Specify the solution, Identify the information requirements that must be met by a system solution. It involves the gathering of information needed to purchase or develop a new system. In-depth study of the proposed system is conducted to determine its feasibility (i.e. strength and weakness)
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Interactive session
Case Study:
BUSINESS PROCESS REDESIGN AT THE UNITED STATES SMALL BUSINESS ADMINISTRATION (SBA)
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This results in specifications for user interface methods and Lecturer: Felix Amponsah-Kubi. Regent products, database structures, and processing and control University procedures
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PROTOTYPING
Prototyping is an approach to system design in which a simplified working model, or prototype, of an information system is developed This scaled down experimental first draft is quickly and inexpensively built and provided to users for testing. Experimenting with the prototype allows users to determine what they like and do not like about the system. Based on their reaction and feedback, developers modify the system and again present it to the users.
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PROTOTYPING
The basic premise of prototyping is that it is easier for people to express what they like or dislike about an existing system (the prototype) than to imagine what they would like in a system. In other words, if users can try out an actual application, they can provide feedback as to what they do and do not like about it.
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Schematic
Prototype
The schematic is converted into a simple point-andclick prototype using prototyping tools
Presentation
Feedback
After the team gets feedback from users, the prototype is reiterated
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Consultation
Consultations are held with IT consultants to identify the potential improvements and conformance to existing standards The prototype is used as a model to create a finished application
Completion
Acceptance
Users review and sign off on their acceptance of the new business system
Installation
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Change Management
People are the major focus of organisational change. Some key tactics experts recommend include: 1) Involve as many people as possible in IS planning and application development. 2) Make constant change an expected part of the culture. 3) Tell every one as much as possible about every thing as often as possible, preferably in person. 4) Make liberal use of financial incentives and recognition. 5) Work within the company culture, not around it.
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8) Design Organisation:
i. Understand current organisation ii. Design target organisation iii. Implement organisational change
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End-User Development
End-user development occurs when information users develop their own applications using computer specialists as advisers.
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