Organizational Resource Management

ORM 8

Information Systems (IS)

What is IS?

IS – a set of interrelated components working together to collect, retrieve, process, store, and distribute information for the purpose of facilitating planning, control, coordination, analysis, and decision making in business organizations

Input-process-output perspective People-organization-technology perspective

Information Systems

Why Do People Need Information?

Individuals - Entertainment and enlightenment

Businesses - Decision making, problem solving and control

Data, Information, and Systems Data vs. Information

Data A “given,” or fact; a number, a statement, or a picture Represents something in the real world The raw materials in the production of information

Information Data that have meaning within a context Data in relationships Data after manipulation

An Information System is an organized combination of people, hardware, software, communication networks and the data resources that collects, transforms and disseminates information in a organization.

Computer-based Information System

Data, Information,and Systems

Generating Information Computer-based ISs take data as raw material, process

it, and produce information as output.

Figure 1.1 Input-process-output

Data, Information, and Systems

What Is a System? System: A set of components that work together to

achieve a common goal

Subsystem: One part of a system where the products of more than one system are combined to reach an ultimate goal

Closed system: Stand-alone system that has no contact with other systems

Open system: System that interfaces with other systems

Data, Information,and Systems

Figure 1.3 Several subsystems make up this corporate accounting system.

Data, Information, and Systems

The Four Stages of Data Processing

Input: Data is collected and entered into computer.

Data processing: Data is manipulated into information using mathematical, statistical, and other tools.

Output: Information is displayed or presented.

Storage: Data and information are maintained for later use.

Ethical and Societal IssuesThe Not-So-Bright Side

Consumer Privacy Organizations collect (and sometimes sell) huge

amounts of data on individuals.

Employee Privacy IT supports remote monitoring of employees,

violating privacy and creating stress.

Ethical and Societal IssuesThe Not-So-Bright Side Freedom of Speech

IT abridge free speech.

IT Professionalism No mandatory or enforced code of ethics for IT professionals--

unlike other professions.

Social Inequality Less than 20% of the world’s population have ever used a PC;

less than 3% have Internet access.

Activity 1

Share your experience of Information Systems incorporated in your company?

Role of IS

Expanding Roles of IS

1. Data Processing: 1950s-1960s

2. Management Reporting: 1960s-1970s

3. Decision support: 1970s-1980s

4. Strategic and End User Support: 1980s-1990s

5. Global Internetworking: 1990s-2000s

Classification of IS

Information Systems

Operations Support System Management

Support System

Transaction processing systems

Process control systems

Office automation systems

Management information systems

Decision support systems

Executive information systems

Other categories

a) Expert systems

b) End user computing systems

c) Business information systems

d) Strategic information systems

a) Expert Systems are knowledge-based systems that provides expert advice and act as expert consultants to the users

b) End user computing systems support the direct, hands on use of computers by end users for operational and managerial applications

c) Business information systems support the operational and managerial applications of the basic business functions of a firm

d) Strategic information systems provide a firm which strategic products, services, and capabilities for competitive advantage

Enterprise Resource Planning (ERP)

Integrated programs that can manage a company’s entire set of business operations

Often coordinate planning, inventory control, production and ordering

INFORMATION SYSTEMS @ X

INFO420: Managing Information Technology

Information Systems PlanningInformation Systems Planning

Definition / Levels of IS Planning

What is IS planning?What is IS planning? The process of developing a view of the future that guides

decision making today Stating the direction we want to go and how we intend to get

there

The Changing World of Planning

Evolution of strategic IS planning along with rapid change of Internet-driven technologies.

Traditional style of planning no longer viable Command and control IS as a support function “Lifecycle” (static environment)

Still need long-range vision but with flexibility and creativity

INFORMATION INFORMATION

SYSTEMS IN THESYSTEMS IN THE

ENTERPRISEENTERPRISE

MANAGEMENT CHALLENGES

KEY SYSTEM APPLICATIONS FUNCTIONAL PERSPECTIVE OF SYSTEMS INTEGRATING FUNCTIONS & PROCESSES

*

TYPES OF INFORMATION SYSTEMSTYPES OF INFORMATION SYSTEMS

DATA WORKERSDATA WORKERS

KIND OF SYSTEM GROUPS SERVEDKIND OF SYSTEM GROUPS SERVED

STRATEGIC LEVEL SENIOR STRATEGIC LEVEL SENIOR MANAGERSMANAGERS

MANAGEMENT LEVEL MIDDLE MANAGEMENT LEVEL MIDDLE MANAGERSMANAGERS

OPERATIONAL OPERATIONAL

OPERATIONAL LEVEL OPERATIONAL LEVEL MANAGERS MANAGERS

KNOWLEDGE LEVEL KNOWLEDGE &KNOWLEDGE LEVEL KNOWLEDGE &

SALES & MANUFACTURING FINANCE ACCOUNTING HUMANSALES & MANUFACTURING FINANCE ACCOUNTING HUMAN RESOURCESRESOURCESMARKETINGMARKETING

MAJOR TYPES OF SYSTEMS

EXECUTIVE SUPPORT SYSTEMS (ESS) DECISION SUPPORT SYSTEMS (DSS) MANAGEMENT INFORMATION SYSTEMS (MIS) KNOWLEDGE WORK SYSTEMS (KWS) OFFICE AUTOMATION SYSTEMS (OAS) TRANSACTION PROCESSING SYSTEMS (TPS)

*

MANAGEMENT LEVEL INPUTS: LOW VOLUME DATA PROCESSING: INTERACTIVE OUTPUTS: DECISION ANALYSIS USERS: PROFESSIONALS, STAFF

EXAMPLE: CONTRACT COST ANALYSIS

DECISION SUPPORT SYSTEMS (DSS)(DSS)

FLEXIBLE, ADAPTABLE, QUICK USER CONTROLS INPUTS/OUTPUTS NO PROFESSIONAL PROGRAMMING SUPPORTS DECISION PROCESS

*

DECISION SUPPORT SYSTEMS (DSS)(DSS)

STRATEGIC LEVEL INPUTS: AGGREGATE DATA PROCESSING: INTERACTIVE OUTPUTS: PROJECTIONS USERS: SENIOR MANAGERS

EXAMPLE: 5 YEAR OPERATING PLAN

EXECUTIVE SUPPORT SYSTEMS (ESS)(ESS)

TOP LEVEL MANAGEMENT DESIGNED TO THE INDIVIDUAL TIES CEO TO ALL LEVELS VERY EXPENSIVE TO KEEP UP EXTENSIVE SUPPORT STAFF

*

EXECUTIVE SUPPORT SYSTEMS (ESS)(ESS)

SALES & MARKETING INFORMATION SYSTEM

SYSTEM DESCRIPTION ORGANIZATIONAL LEVEL

ORDER PROCESSING ENTER, PROCESS, TRACK ORDERS OPERATIONAL

MARKET ANALYSIS IDENTIFY CUSTOMERS & MARKETS KNOWLEDGE

PRICING ANALYSIS DETERMINE PRICES MANAGEMENT

SALES TRENDS PREPARE 5-YEAR FORECASTS STRATEGIC

MANUFACTURING INFORMATION SYSTEM

SYSTEM DESCRIPTION ORGANIZATIONAL LEVEL

MACHINE CONTROL CONTROL ACTIONS OF EQUIPMENT OPERATIONAL

COMPUTER-AIDED-DESIGN DESIGN NEW PRODUCTS KNOWLEDGE

PRODUCTION PLANNING DECIDE NUMBER, SCHEDULE OF PRODUCTS MANAGEMENT

FACILITIES LOCATION DECIDE WHERE TO LOCATE FACILITIES STRATEGIC

FINANCE & ACCOUNTING INFORMATION SYSTEM

SYSTEM DESCRIPTION ORGANIZATIONAL LEVEL

ACCOUNTS RECEIVABLE TRACK MONEY OWED TO FIRM OPERATIONAL

PORTFOLIO ANALYSIS DESIGN FIRM'S INVESTMENTS KNOWLEDGE

BUDGETING PREPARE SHORT TERM BUDGETS MANAGEMENT

PROFIT PLANNING PLAN LONG-TERM PROFITS STRATEGIC

HUMAN RESOURCES INFORMATION SYSTEM

SYSTEM DESCRIPTION ORGANIZATIONAL LEVEL

TRAINING & DEVELOPMENT TRACK TRAINING, SKILLS, APPRAISALS OPERATIONAL

CAREER PATHING DESIGN EMPLOYEE CAREER PATHS KNOWLEDGE

COMPENSATION ANALYSIS MONITOR WAGES, SALARIES, BENEFITS MANAGEMENT

HUMAN RESOURCES PLANNING PLAN LONG-TERM LABOR FORCE NEEDS STRATEGIC

Developing an Information Technology Risk Management

Program

Information Security

the protection of data against unauthorized access or modification

What is “Risk”?

Risk is intentionally exploit a particular information system vulnerability, and the resulting impact on the organization if this should occur (National Institute of Standards & Technology-NIST)

Risk is the probability of a vulnerability being exploited in the current environment, leading to a degree of loss of confidentiality, integrity, or availability, of an asset. (Microsoft)

What is Risk Management?

The goal of a risk management program is to protect the organization and its ability to perform its mission from IT-related risk

Risk Management is the Keystone of

Information Security

Risk Management has Three Parts

Risk Assessment - Determining where risks lie, and how big they are

Risk Mitigation - Prioritizing, evaluating, and implementing appropriate risk-reducing controls

Evaluation and Assessment – Since Risk Management is continuous and evolving, the past year’s Risk Management efforts should be assessed and evaluated prior to beginning the cycle again

Risk Management Process

Risk Assessment

Risk Mitigation

RM Evaluation

Assessing Risk Phase has Three Steps

1) Planning – Align your annual process with your budget; Specify your scope; Identify and pre-sell stakeholders; embrace subjectivity

2) Facilitated Data Gathering – Identify tangible and intangible assets, threats, vulnerabilities, existing controls, probable impact

3) Risk Prioritization – Determine probabilities, and combine impact with probability to produce a risk statement

Risk Mitigation Options

Assume the Risk – Accept the risk and continue operating (how big is your appetite?)

Avoid the Risk – Stop running the program or sharing the data

Transfer the Risk – Use options to compensate for the loss, such as insurance

Lessen the Risk – Implement controls that lessen the impact or lower the likelihood

Activity 3

Can Risk Assessment be done in terms of calculation of financial figures?