Information System in Business Today

Three activities of information systems produce information organizations need – Input: Captures raw data from organization or external environment external environment – Processing: Converts raw data into meaningful form – Output: Transfers processed information to people or activities that use it Feedback: – Output is returned to appropriate members of organization to help evaluate or correct input stage. Computer/Computer program vs.. / information system – Computers and software are technical foundation and tools, similar to the material and tools used to build a house. 19 1. 20 Functions of an Information System An information system contains information about an organization and its surrounding environment. Three basic activities?input, processing, and output? produce the information organizations need. Feedback is output returned to appropriate people or activities in the organization to evaluate and refine the input. Environmental actors, such as customers, suppliers, competitors, stockholders, and regulatory agencies, interact with the organization and its information systems. Figure 1. 4 Information Systems Are More Than Computers
Using information systems effectively requires an understanding of the organization, management, and information technology shaping the systems. An information system creates value for the firm as an organizational and management solution to challenges posed by the environment. Figure 1. 5 1 . 21 1. 22 Levels in a Firm Business organizations are hierarchies consisting of three principal levels: senior management, middle management, and operational management. Information systems serve each of these levels. Scientists and knowledge workers often work with meme management. Organizational dimension of information systems –
Hierarchy of authority, responsibility Senior management Middle management Operational management Knowledge workers Data workers Production or service workers 1. 23 Figure 1. 6 1. 24 4 Organizational dimension of information systems (count. ) – Separation of business functions S I Sales and marketing d k I Human resources Finance and accounting Manufacturing and production Management dimension of information systems – Managers set organizational strategy for responding to business challenges responding to business challenges – In addition, managers must act creatively:

Creation of new products and services Occasionally re-creating the organization – Unique business processes – Unique business culture – Organizational politics

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