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10/25/2018
The vehicle order system at Toyota
Reduce production time and the cost of the material
as well as finished inventory
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With improved information transperancy, Toyota
would be able to better readjust allocation of available
product to markets that would be high in demand and
performance
THE ROLE OF IS IN BUSINESS TODAY
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In 2006, American Business spendt 1.8 trillion on IS
hardware, software and telecommunications equipment
and spent additional 1.7 trillion USD on business and
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IT has been transforming businesses
More wireless phones accounts have been opened up in
recent years than telephone lines installed
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GLOBALIZATION OPPORTUNITIES AND
DIGITAL FIRM
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World economy today depends on imports and
exports
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All of the changes in our world coupled with equally
significant organizational redesign have created conditions
for a fully digital firm
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In a digital firm, any piece of information required to support
key business decisions available at any time and anywhere in
the firm
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Why IS is so essential today? Why investing so
much money in IS?
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Many sectors would exist without IS such as online auction
and commerce sites
Many traditional firms such as WalMart, Sears and GE
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Operational excellence: Businesses continuously
seek to improve the efficiency of their operations
to achieve higher profitability
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Management Information Systems
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STRATEGIC BUSINESS OBJECTIVES OF IS
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WalMart attained more than $285 billion in sales
nearly one-tenth of retail sales in US in large
part because of its RetailLink system, which
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STRATEGIC BUSINESS OBJECTIVES OF IS
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New products, services and business models: IS
are a major enabling tool for firms to create new
products and services as well as entirely new
purchasing more
STRATEGIC BUSINESS OBJECTIVES OF IS
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The more business engages with its suppliers, the better the
suppliers can provide vital inputs. This lower costs –
Mandarin Hotel in NY
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Competitive advantage: When firms achieve one or
more of these objectives: operational excellence,
new products, services and business models,
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Survival: Business firms also invest in ICTs
because they are necessities of doing business
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Information Technology consists of all the
hardware and software that a firm needs to use
in order to achieve its business objectives
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WHAT IS INFORMATION SYSTEMS
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IS can be technically defined as interrelated
components that collect, process, store and
distribute information to support decision
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Information means data that have been shaped
into a form that is meaningful and useful to
human beings
store
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DATA VERSUS INFORMATION
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FUNCTIONS OF INFORMATION SYSTEMS
WHAT IS INFORMATION SYSTEMS
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Three activities in an IS produce information that
organizations need to make decisions, control
operations, analyze problems and create new products
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To fully understand IS, we must understand the
broader organization, management and information
technology dimensions of systems
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Management Information Systems
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ORGANIZATIONS
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IS are integral part of organizations
Some firms such as credit organizations without IS, there
is no business
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Knowledge workers such as engineers, scientist
design products or services and create new
knowledge for the firm
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The major business function consist of sales and
marketing, manufacturing and production, finance
and accounting and human resources
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Management’s job is to make sense of the many
situations faced by organizations and formulate
actions to solve organizational problems
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IT is one of many tools managers use to cope with
change
Computer hardware is the physical equipment used
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A Network links two or more computers to share
data or resources, such as printers
The world’s largest and most widely used
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Information technology infrastructure provides the foundation
or platform on which the firm can build its specific information
systems
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Managers and business firms invest in IT and IS
because they provide real economic value to the
business
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Awareness of the organizational and managerial
dimensions of IS can help us understand why some
firms achieve better results from their IS than others
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Complementary assets are those assets required to derive
value from a primary investments
To realize value from automobiles requires substantial
investment in highways, roads, gasoline stations, repair
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The study of IS is multidisciplinary field. No
single theory or perspective dominates the field
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10/25/2018 Management Information Systems
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CONTEMPORARY APPROACHES TO IS
TECHNICAL APPROACH
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The technical approach to IS emphasizes mathematically
based models to study IS as well as the physical technology
and formal capabilities of these systems
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An important part of the IS field is concerned with behavioral
issues that arise in the development and long term maintenance
of IS
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The study of MIS arose in the 1970s to focus on
the use of computer based systems in business
firms and government agencies
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It is better to try to understand both perspectives
In sociotechnical view of IS, optimal organizational performance
is achieved by jointly optimizing both the social and technical