Information Systems in Global
Business Today
Syed Ali Akbar Rizvi
Office Automation
Information Technology
• Consists of all the hardware and software that a firm
needs to use in order to achieve its business
objectives
Information System
• Is a set of interrelated components that collect (or
retrieve), process, store, and distribute information to
support decision making and control in an
organization
The Role of Information Systems in Business
Today
• Information systems are the foundation for
conducting business today
• As a society we have come to rely extensively on the
use of information appliances such as cell phones,
handhelds and other hardware
• Internet technologies have become essential business
tools
Globalization Challenges and Opportunities:
A Flattened World
• Firms producing goods and services on a global scale
achieve extraordinary cost reductions by finding low
cost suppliers and managing production facilities in
other countries
• Customers now can shop in a worldwide market place
obtaining price and quality information reliably 24
hours a day
The Emerging Digital Firm
In the emerging, fully digital firm:
• All of the organization’s significant business relationships
with customers, suppliers and employees are digitally enabled
and mediated
• Core business processes are accomplished through digital
networks
• Key corporate assets are managed digitally
• Greater flexibility to survive in turbulent times is ensured
• Both time and space shifting are the norm
Strategic Business Objectives of Information
Systems
• There is a growing interdependence between a firm’s ability to
use information technology and its ability to implement
corporate strategies and achieve corporate goals
The Interdependence Between Organizations and Information
Technology
• Business firms invest heavily in information systems
to achieve six strategic business objectives :
1) Operational Excellence
• Information systems and technologies are some of
the important tools for achieving higher levels of
efficiency and productivity in business operations
2) New Products, Services and Business Models
• Information systems and technologies can enable
firms to create new products and services as well as
entirely new business models
3) Customer and Supplier Intimacy
4) Improved Decision Making
• Information systems and technologies have made it
possible for managers to use real time data from the
marketplace when making decisions
5) Competitive Advantage
6) Survival
• Business firms invest in information systems and
technologies because they are necessities of doing business
Data and Information
Functions of an Information System
Information Systems Are More Than
Computers
Dimensions of Information Systems
1) Organizations
• The key elements of an organization are its people,
structure, business processes, politics and culture
Structure of a Firm
Seni
or
Man
age
ment
Middle Management
Scientists and
Knowledge Workers
Operational Management
Production and service workers
Data workers
2) Management
• Managers perceive business challenges in the
environment, they set the organizational strategy for
responding to those challenges and they allocate
human and financial resources to coordinate the work
and achieve success
• Information technology can play a powerful role in
helping managers design and deliver new products
and services , thus in redirecting and redesigning their
organizations
3) Technology
• Information technology is one of many tools managers
use to cope with change
• Computer hardware: includes the physical equipment
used for input, processing and output activities in an
information system
• Data management technology: consists of the
software governing the organization of data on physical
storage media
• Networking and telecommunications technology
Consisting of both physical devices and software, links the
various pieces of hardware and transfers data from one
physical location to another
• A network links two or more computers to share data or
resources such as printer
• The world’s largest and most widely used network is the
Internet, representing global “network of networks”
• Internal corporate networks based on internet technology are
called intranets
• Private intranets extended to authorized users outside the
organization are called extranets
• The World Wide Web is a service provided by the Internet
that uses universally accepted standards for storing,
retrieving, formatting and displaying information in a page
format on the Internet
• All of the above mentioned technologies, along with the
people required to run and manage them represent
resources that can be shared throughout the organization
and constitute the firm’s information technology
infrastructure
• The IT infrastructure provides the foundation or
platform on which the firm can build its specific
information systems
• Each organization must carefully design and manage
its IT infrastructure so that it has the set of technology
services it needs for the work it wants to accomplish
with information systems
The Business Information Value Chain
Complimentary Assets: Organizational Capital
and the Right Business Model
• Information technology investments alone cannot make
organizations and managers more effective unless they are
accompanied by complimentary assets
• Investments in complimentary assets include building new
business models, new business processes, change in
management behavior and organizational culture
• Some of the complementary social, managerial, and
organization assets required to optimize returns from
information technology investments
Organizational assets:
• Supportive culture that values efficiency and effectiveness
• Appropriate business model
• Efficient business processes
• Decentralized authority
Managerial assets:
• Strong senior management support for technology
investment and change
• Incentives for management innovation
• Teamwork and collaborative work environments
Social assets:
• The Internet and telecommunications
infrastructure
• IT-enriched educational programs raising labor
force computer literacy
• Standards (both government and private
sector)
Perspectives on Information Systems
• Technical approach
• Emphasizes mathematically based models
• Computer science, Management science,
Operations research
• Behavioral approach
• Behavioral issues
• Psychology, Economics, Sociology
