Introduction to Information System

Dr. Shimaa Ismail

Information System Department
Faculty of Computers and Artificial Intelligence
Information Systems in Perspective
Chapter 2
Information Systems in Organizations Part1

2
Principles
• Organizations are open systems that affect and are affected by their surrounding
environment.

• Positive change is a key ingredient for any successful organization.

• Information systems must be implemented in such a manner that they are accepted and
work well within the context of an organization and support its fundamental business
goals and strategies.

• The information system worker functions at the intersection of business and technology
and designs, builds, and implements solutions that allow organizations to effectively
leverage information technology systems.
Learning Objectives
• Sketch a general model of an organization showing how information systems
support and work within the automated portions of an organizational process.
• Define the term value chain and identify several examples within a typical
manufacturing or service organization.
• Define the term innovation with examples.
• Define reengineering and continuous improvement and explain how they are
different.
• Discuss the pros and cons of outsourcing, offshoring, and downsizing.
• Define the term “the soft side of implementing change,” and explain why it is a
critical factor in the successful adoption of any major change.
• Define the types of roles, functions, and careers available in the field of
information systems.
 Why learn about Information Systems in
Organizations
• It helps you and your organization become more efficient, effective, productive,
and competitive.
• Information systems were once used primarily to automate manual processes.
• The implementation of new information systems has a major impact on an
organization:
• Affecting people’s roles and responsibilities,
• Their day-to-day routines and processes for accomplishing work,
• Who they interact with,
• What skills and knowledge they need,
• How they are rewarded and compensated.
Organizations
• Organization: A group of people that is structured and managed to meet its
mission or set of group goals.

• “Structured” means that there are defined relationships between members of

the organization and their various activities, and that processes are defined that
assign roles, responsibilities, and authority to complete the various activities.
Organizations: Value Chain
• Providing value to a stakeholder—customer, supplier, partner, shareholder, or employee—is
the primary goal of any organization.

• The value chain, first described by Michael Porter in a classic 1985 Harvard Business Review
article titled “How Information Gives You Competitive Advantage”

• Value Chain: A series (chain) of activities that an organization performs to transform inputs
into outputs in such a way that the value of the input is increased.

• Example: the gift-wrapping department of an upscale retail store takes packages from
customers, covers them with appropriate, decorative wrapping paper, and gives the package
back to the customer, thus increasing the customer’s (and the recipient’s) perceived value of
the gift.
Organizations: Value Chain

• In a manufacturing organization, the Supply Chain is a key value chain whose primary
activities include inbound logistics, operations, outbound logistics, marketing and
sales, and service.
Organizations: Value Chain

➢Inbound logistics include functions like receiving, warehousing, and managing inventory.

➢Operations include procedures for converting raw materials into a finished product.

➢Outbound logistics include activities to distribute a final product to a consumer.

➢Marketing and sales include strategies to enhance visibility and target appropriate
customers—such as advertising, promotion, and pricing.

➢Service includes programs to maintain products and enhance the consumer

experience—like customer service, maintenance, repair, refund, and exchange.
 Organizations: Value Chain
The supply chain also includes four main areas of support activities:

Other Examples: tax preparers, restaurants, book publishers, legal firms, and other service providers.
Supply Chain Management (SCM) encompasses all the activities required to get the right product into
the right consumer’s hands in the right quantity at the right time and at the right cost—from the
identification of suppliers and the acquisition of raw materials through manufacture and customer
delivery.
Virtual Teams and Collaborative Work
• Virtual Team:
A group of individuals whose members are distributed geographically, but who
collaborate and complete work through the use of information systems.
• may be composed of individuals from a single organization or from multiple organizations.
• can consist of just two people up to hundreds of team members.

• Benefits of virtual teams are:

• They enable organizations to enlist the best people in different geographical regions to solve
important organizational problems.
• They provide the ability to staff a team with people who have a range of experience and
knowledge that stems from a variety of professional experiences and cultural backgrounds.
Change in the Organization
• Your organization’s current products, services, and ways of accomplishing work are doomed
to obsolescence. Fail to change and your competition will take away your customers and your
profits.

• Positive change is a key ingredient for any successful organization.

• Some topics related to change need to be known, including

✓ Innovation,
✓ Reengineering,
✓ Continuous Improvement,
✓ Outsourcing,
✓ Offshoring,
✓ Downsizing.
Change in the Organization
• Innovation: The application of new ideas to the products, processes, and activities of a firm,
leading to increased value.
Example: Healthcare technology company iHealth has introduced several different sensors that can
measure and report on a wide array of biometric data, including steps taken, distance covered, and calories
burned; sleep efficiency; blood pressure; glucose level; and blood oxygen saturation level and pulse rate.

• Reengineering, also called Process Redesign and Business Process Reengineering (BPR), involves
the radical redesign of business processes, organizational structures, information systems, and
values of the organization to achieve a breakthrough in business results.

Successful reengineering can:

• reduce delivery time,
• increase product and service quality,
• enhance customer satisfaction,
• increase revenues and profits.
Change in the Organization
• Continuous Improvement: In contrast to reengineering, Its idea (often referred to by the Japanese word
“Kaizen”) is a form of innovation that “Constantly seeking ways to improve business processes and add
value to products and services”.
This continual change will increase customer satisfaction and loyalty and ensure long-term profitability.
Change in the Organization
• Outsourcing: A long-term business arrangement in which a company contracts for services with
an outside organization that has expertise in providing a specific function.

• Offshore Outsourcing (Offshoring): An outsourcing arrangement where the organization providing

the service is located in a country different from the firm obtaining the services.

• Downsizing, a term frequently associated with outsourcing, involves reducing the number of
employees to cut costs.

All these staffing alternatives are an attempt to reduce costs or improve services.
Each approach has its own associated ethical issues and risks.