Business Information Systems

Exercise 1:
Business Process Modelling

Based on the course “Business Analysis Foundations: Business Process Modeling”

by Haydn Thomas available at https://www.linkedin.com/learning/business-analysis-
foundations-business-process-modeling
Dr. Elena Gorbacheva | Business Informatics 1 (OWIN)
Mock Exam
Task 1
For each question, choose one correct answer from the list

Q5. Business analysis not only involves considering the inputs or outputs of an
organisation’s system, but also involves reviewing external entities’ processes
and systems.

a) TRUE
b) FALSE

Dr. Elena Gorbacheva | Business Informatics 1 (OWIN) 2

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Task 1
For each question, choose one correct answer from the list

Q6. You are creating a Context Diagram for an organisation that has the bulk of its
IT operations done overseas. What is an example of good practice when creating
the diagram?

a) You create an elaborate, complex diagram that reviews the internal

functionality of the organisation.
b) You group all IT operational partners together and label it “IT operations”.
c) You list every external offshore partner of the organisation.
d) All of these answers

Dr. Elena Gorbacheva | Business Informatics 1 (OWIN) 3

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1. Context Diagram
Example

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Task 1
For each question, choose one correct answer from the list

Q7. What is true of the Functional Flow Diagram?

a) It can be used to target specific audiences when analysing the detail within
each functional area.
b) It's is a simple model showing each functional area or stakeholder that is
internal to your organisation, and how they interact in the logical overall flow
of work.
c) It ensures you've covered all the touchpoints within your organisation prior to
documenting your Cross-Functional Flow Diagram.
d) All of these answers

Dr. Elena Gorbacheva | Business Informatics 1 (OWIN) 5

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2. Functional Flow Diagram
Example

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Task 1
For each question, choose one correct answer from the list

Q8. Like the context diagram, the functional flow diagram uses flows to indicate
the relationship between the stakeholder groups. The flow in a functional flow
diagram, however, must only have one label indicating the data flowing between
each function.

a) TRUE
b) FALSE

Dr. Elena Gorbacheva | Business Informatics 1 (OWIN) 7

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Task 1
For each question, choose one correct answer from the list

Q10. The _____ focuses on how the flow of work moves across the functional areas
of your organisation. It contains the complete end-to-end process of a single
transaction.

a) Flowchart Diagram
b) Context Diagram
c) Cross-functional Flow Diagram
d) Functional-Flow Diagram

Dr. Elena Gorbacheva | Business Informatics 1 (OWIN) 8

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3. Cross-Functional Flow Diagram
Example

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Task 1
For each question, choose one correct answer from the list

Q11. The more subprocesses you identify in a _____ diagram, the more flowchart
process maps you'll need to create.

a) Functional-Flow Diagram
b) Context Diagram
c) Flowchart Diagram
d) Cross-functional Flow Diagram

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 Business Information Systems
Mock Exam

Dr. Elena Gorbacheva | Business Informatics 1 (OWIN)

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Eastspring:
Targeted Enterprise System Building
Case Study

Read the case and attend to the following questions:

▪ What problems did Eastspring solve by implementing a

Target Operating Model (TOM)?

▪ What are the benefits of using TOM?

(10 Points)

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What problems did Eastspring solve by
implementing a Target Operating Model (TOM)?

▪ Problems were caused by the old and outdated legacy systems, which were
launched back in 1994, as well as further systems were built around them over
the years to satisfy emerging business needs
▪ Composition of these systems became so complex that the project in 2014 to
upgrade and unify them failed
▪ These systems were local, meaning that it was difficult for other parts of the
company to access and understand them
▪ As a result, these systems were hindering:
▪ Collaborative work
▪ Ability to take full advantage of new market opportunities and expand into new
markets (regionally and globally)
▪ Business performance
▪ Achievement of business goals

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What are the benefits of using TOM?

▪ Based on the review of variations in business processes across the business

units, local and regional business processes were redesigned and improved, so
that they match the new enterprise software
▪ New technology landscape allowed the company to run its business more
efficiently and effectively and provided the functionality to support global
expansion
▪ As a result, the company is now in 14 markets world-wide and since 2013 the
funds under management by Eastspring have grown over 25%

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L1. Information Systems in Global Business Today

▪ What is an Information System (IS)? What is the difference between IS and

Information Technology?
(3 points)

▪ Introduce the main ideas of the organisational, management, and technology

dimensions of IS?
(6 points)

(9 Points)

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Definition: Information Systems

▪ A boundary-spanning field connecting business and Information Technology (IT)

▪ Information Technology (IT) - All the hardware and software technologies a company needs in order to
achieve its business objectives

▪ Hardware - A physical part of an electronic device (e.g., computer, laptop, smartphone, tablet etc.)
▪ Software - A collection of instructions that tell the electronic device how to work and perform a task
(e.g., applications running on your electronic device)

▪ Hardware and software are technical foundation and tools for IS, similar to the material and tools
used to build a house

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Definition: Information Systems

▪ Information – Data (streams of raw facts) that have been shaped into a form
that is meaningful and useful to people

▪ System - A set of interrelated components that (hopefully) work together

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Business Perspective on Information Systems
Management, organisation, and technology dimensions of IS

▪ A combination of management,
organisation, and technology
dimensions shape IS

▪ Main components of IS:

▪ Tasks that need to be performed to
address business challenges
(management)
▪ People who perform these tasks
(organisation)
▪ IT that supports people in
performing the tasks (technology)

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Business Perspective on Information Systems
Management Dimension of IS

▪ IS support managers in their work and decision-making

▪ Examples:

▪ Setting the organisational strategy for responding to business challenges

▪ Allocation of the human and financial resources to coordinate the work

▪ Development of new products and services

▪ Redirecting and redesigning the organisation

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Business Perspective on Information Systems
Organisational Dimension of IS

▪ IS serve each level in the organisational

hierarchy

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Business Perspective on Information Systems
Organisational Dimension of IS

▪ Various organisational factors shape IS

▪ Separation of functional areas (e.g., sales and marketing, human resources,

finance and accounting, manufacturing and production)

▪ Business processes

▪ Organisational culture

▪ Organisational politics

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Business Perspective on Information Systems
Technology Dimension of IS

▪ Hardware and software

▪ Information Technology (IT) infrastructure (→ Chapter 5)

▪ Data management technology (→ Chapter 6)

▪ Networking and telecommunications technology (→ Chapter 7)

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L1. Information Systems in Global Business Today /
L1.1. Business Process Modelling

▪ What is business process modelling?

▪ Why can it be useful for an organisation to model its business processes?

▪ How should an organisation decide, which of its business processes need to be

modelled?

(6 Points)

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Business Process Modelling

▪ A visual way to represent how an organisation performs the work and services

▪ Enables to represent current state (‘as-is’), define expected future state (‘to-be’), and
identify gaps and steps needed to move from ‘as-is’ to ‘to-be’

▪ Demonstrates the flow of activities and the interaction between various stakeholders

▪ Stakeholders
▪ Perform the required activities
▪ Called actors in Business Process Modelling and can be
▪ Person
▪ Functional area (department at an organisation)
▪ Information System
▪ External entity

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Business Process Modelling
Benefits

▪ Enhances an understanding of how the organisation runs, performs activities,

and relates to the outside world

▪ Identifies areas of the business that are not well-understood

▪ Helps identity complex business processes and breaks them down

▪ Documents the ‘as-is’ and ‘to-be’ states

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Why Organisations Use Modelling?

▪ To share and demonstrate the concepts and designs to larger audiences in a

cost-effective way

▪ To receive feedback on where the organisation is now and what is to come

▪ To capture the inter-relationships between the people, processes, activities,

and systems in delivering the expected outcomes

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Steps in Business Process Management

1. Identify processes for change

2. Analyse each of the identified processes (‘as-is’)

3. Design the new process (‘to-be’)

4. Implement the new process

5. Continuously measure and improve the new process

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L3. Information Systems, Organisations, and
Strategy
▪ Which of the following two hierarchies represents an organisation that makes
good use of Information Systems for management? Explain why.
(3 points)

▪ Briefly introduce the main ideas of agency theory and agency costs, as well as
explain, how the agency costs differ in the aforementioned hierarchies.
(4 points)
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Agency Theory

▪ Agency theory
▪ Economic theory that views the company as a chain of contracts among self-interested
individuals who must be supervised and managed

▪ The cost of managing and supervising employees (agency costs) grow as company grows

▪ IS can help companies reduce agency costs

▪ IS reduces the costs of acquiring and analysing information, which makes it easier for
managers to supervise a larger number of employees

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Information Systems Flatten Companies
▪ IS can support reducing the number of
middle managers who had the task to
supervise and control employees

▪ IS can support giving lower-level

employees more decision-making
authority

▪ Benefits
▪ Reduced agency costs
▪ Faster decision-making
▪ Information travels through fewer
levels to its intended recipients
▪ Lower-level employees receive the
information they need to make
decisions

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L5. IT Infrastructure and Emerging Technologies

▪ In the evolution of Information Technology (IT) infrastructure, the following

five main eras can be highlighted:
▪ (i) mainframe and minicomputer era;
▪ (ii) personal computer era;
▪ (iii) client-server era;
▪ (iv) enterprise computing era; and
▪ (v) cloud and mobile computing era.

▪ Describe the main characteristics of each era.

(10 Points)

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Evolution of IT Infrastructure

▪ Mainframe and minicomputer era: from 1950s

▪ 1959: Mainframes were introduced by IBM
▪ 1965: Less expensive minicomputers were introduced by DEC (Digital Equipment Corporation)

▪ Personal computer era: from 1980s

▪ 1981: Personal computers were introduced by IBM
▪ 1980s-1990s: Diffusion of personal computers resulted in the growth of software for personal use

▪ Client-server era: from 1980s

▪ Client–server structure - A distributed application structure that divides tasks or workloads
between the providers of a resource or service, called servers, and service requesters, called
clients

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Evolution of IT Infrastructure

▪ Enterprise computing era: from 1990s

▪ Creation of the enterprise-wide IT infrastructure by linking different pieces of
computer hardware, software, and IT services into an enterprise-wide network

▪ Cloud and mobile computing era: from 2000s

▪ Reminder: Cloud computing
▪ Model of computing in which computer processing, storage, software, and other
services are provided as a shared pool of virtualized resources over a network,
primarily the internet
▪ Note: Computing - Any activity that uses computers to manage, process, and
communicate information; includes development of both hardware and software

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Evolution of IT Infrastructure

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L6.2. Structured Query Language
▪ Citizens live in Villages.
▪ The Citizen table has the following fields: CitizenID (PK), VillageID (FK),
CitizenName, CitizenGender, CitizenState, CitizenJob, CitizenGoldAmount.
▪ The Village table has the following fields: VillageID (PK), VillageName.
▪ Complete the following SQL (Structured Query Language) statements:

▪ Retrieve the names of all citizens who have less than 100 pieces of gold.
(3 points)

▪ Retrieve the names of all villages, which have female engineers as citizens.
(5 points)

(8 points)
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Retrieve the names of all citizens who have
less than 100 pieces of gold.

SELECT CitizenName

FROM Citizen

WHERE CitizenGoldAmount < 100;

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Retrieve the names of all villages, which have
female engineers as citizens.

SELECT Village.VillageName

FROM Village JOIN Citizen ON

Village.VillageID = Citizen.VillageID

WHERE Citizen.CitizenGender = ‘woman’

AND Citizen.CitizenJob = ‘engineer’

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L7. Telecommunications, the Internet, and
Wireless Technology

▪ Define in your own words, what the internet is, and explain the difference
between the internet and the World Wide Web (WWW).
(4 points)

▪ In the lecture on “Telecommunications, the Internet, and Wireless

Technology”, packet switching was introduced as one of the key technologies
that enable the internet. Explain the main idea of packet switching and sketch
(draw a diagram), how packet switching works in Voice over IP (VoIP). Please
also explain, what VoIP is.
(7 points)

(11 points)

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Internet (Interconnected Network)

▪ The global system of interconnected computer networks that uses the internet protocol suite
(TCP/IP - Transmission Control Protocol / Internet Protocol) to link devices worldwide

▪ Consists of private, public, academic, business, and government networks

▪ These networks are of local to global scope and are linked by a broad array of electronic, wireless,
and optical networking technologies

▪ Carries a vast range of information resources and services, including

▪ The inter-linked hypertext documents and applications of the World Wide Web (WWW)
▪ Email
▪ Telephony
▪ File sharing

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World Wide Web (WWW)

▪ An information system containing web resources (webpages)

▪ = web

▪ Webpages
▪ Are accessible over the internet by a software called a web browser
▪ Are created using a Hypertext Markup Language (HTML)
▪ Are transferred via the Hypertext Transfer Protocol (HTTP)
▪ Are identified by Uniform Resource Locators (URLs, such as http://www.example.com/)
▪ Are delivered to the user’s computer by a software called a web server
▪ May be interlinked by hypertext

▪ Websites: Collections of webpages linked to the website home page

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Packet Switching

▪ Method of slicing digital messages into data packets

▪ Main idea: Data is grouped into data packets, which are transmitted independently over
various communications channels and reassembled at their final destination

▪ Enables more efficient use of network’s capacity

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Voice over IP (VoIP)

▪ Technology for the delivery of voice communications over the internet

▪ Voice information is delivered in a digital form using packet switching

▪ Substitute fee-based telephone networks

▪ Providers include Skype, Zoom, Microsoft, Google etc.

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How Voice over IP (VoIP) Works

▪ Voice messages are digitized and are broken up into data packets
▪ The packets are then transported over the internet and then reassembled at the final destination (using the
packet switching method)
▪ Gateway - a server nearest to the receiving client computer, which arranges the packets in the proper order and
directs them to the final destination
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L8. Securing Information Systems

▪ A firewall and a Virtual Private Network (VPN) are important tools to defend
your devices from cybersecurity threats, but what is the difference between
them? Explain the main ideas of both a firewall and a VPN and sketch (draw a
diagram), how each of them works.

(10 points)

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Virtual Private Network (VPN)

▪ A private network configured within a public

network, which provides secure encrypted
communication

▪ Computers form a private network, where the

transmitted message is encrypted, and a “wrapper”
is added around it to hide its content

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Firewall

▪ Combination of hardware and software placed

between an organisation’s internal network and an
external network

▪ What is the difference between a firewall and a VPN?

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L9. Enterprise Applications
▪ What is the purpose of Enterprise Applications?
(2 points)

▪ Sketch (draw a diagram) the Enterprise Application Architecture, showing the

relationship between such enterprise applications as Enterprise Resource Planning
Systems (ERP), Supply Chain Management Systems (SCM), Customer Relationship
Management Systems (CRM), and Knowledge Management Systems (KM).
(5 points)

▪ Describe the purposes of SCM and CRM and indicate, how each of these systems
can bring business value.
(6 points)

(13 points)

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Enterprise Applications

▪ Coordinate activities, decisions, and knowledge across different functional areas in

a company

▪ May extend outside the company

▪ Support automation of business processes

▪ Include all levels of management

▪ Typically include a suite of software modules that allow data to be used by

multiple functional areas and business processes
▪ Examples of software modules: sales and distribution, financial accounting, investment
management, materials management, production planning, plant maintenance, human resources

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Enterprise Application Architecture

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Reminder:
Supply Chain Management Systems (SCM)
Types of Enterprise Applications

▪ Enterprise software solutions that automate the flow of information between a

company and its suppliers in order to optimise the planning, production, and
delivery of products and services

▪ Goal: Right amount of high-quality products delivered to destination in fastest

way and with lowest cost

▪ Supply chain
▪ Network of organisations and business processes for procuring materials,
transforming materials into intermediate and finished products, and distributing
the finished products to customers

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SCM Business Value

▪ Match supply to demand

▪ Reduce inventory levels

▪ Reduce supply chain costs

▪ Increase profitability

▪ Improve delivery service

▪ Speed product time to market

▪ Increase sales

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Reminder:
Customer Relationship Management Systems (CRM)
Types of Enterprise Applications

▪ Enterprise software solutions that (i) track all the ways in which a company
interacts with its customers and (ii) analyse these interactions to optimise
revenue, profitability, customer satisfaction, and customer retention

▪ Provide information to sales, marketing, and customer service to coordinate

all the business processes that deal with customers

▪ Help companies identify, attract, and retain most profitable customers

▪ Customer relationship management

▪ Business and technology discipline that focuses on coordination of all business
processes surrounding the company’s interactions with its customers

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CRM Objectives

▪ Capture, integrate, and analyse customer data from all over the company

▪ Distribute customer information to various systems and customer touch points

across the company

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CRM Business Value

▪ Increase customer satisfaction

▪ Increase effectiveness of marketing campaigns

▪ Reduce marketing costs and costs for customer acquisition and retention

▪ Increase sales revenue

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L11. Managing Knowledge and Artificial
Intelligence

▪ What is the purpose of Knowledge Management Systems?

(2 points)

▪ In the lecture on “Managing Knowledge”, such categories of Knowledge

Management Systems as Enterprise-Wide Knowledge Management Systems and
Knowledge Work Systems were introduced. Explain the difference between
these systems by describing their purposes.
(4 points)

(6 points)

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Reminder:
Knowledge Management Systems (KM)
Types of Enterprise Applications

▪ Enterprise software solutions that support organisations in the creation,

collection, storage, maintenance, dissemination, and application of knowledge

▪ Collect internal knowledge and experience within the organisation and make it
available to employees

▪ Link to external sources of knowledge

▪ Example: Knowledge how to create, produce, deliver products and services

▪ Knowledge management
▪ A set of business processes to create, collect, store, maintain, disseminate, and
apply knowledge in the organisation

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Categories of Knowledge Management Systems

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 Dr. Elena Gorbacheva
el.gorbacheva@gmail.com

Dr. Elena Gorbacheva | Business Informatics 1 (OWIN)

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