All companies use information technology / information systems to manage their day to day activities and for

managerial support. Companies are thriving on technology for competitive advantage .You can’t compete nowadays
without technology

What is Digital Transformation?

-Optimizing the business processes to improve customer experience or provide new services / products

-Supporting internal and external business processes with digital means. Involves adopting some kind of electronic
information system

Digital = Information and Communications Technologies (ICT). Computers, mobile phones, Internet, AI robots, etc.

-Sustainable, company level transformation via revised or newly created business operations and business models
achieved through value added digitization initiatives, ultimately resulting in improved profitability

Technology and Change

Automation: Mechanizing procedures to speed up the performance of existing tasks.

Rationalization of procedures: Streamlining of standard operating procedures

Business process reengineering: Analysis & redesign of business processes to optimize workflows

Paradigm shift: Radical reconceptualization of nature of the business / organization

Business Process Reengineering

The most common forms of organizational change are automation and rationalization. These relatively slow moving
and slow changing strategies present modest returns but little risk. Faster and more comprehensive change such as
reengineering and paradigm shifts carries high rewards but offers substantial chances of failure

Advantage from the digital transformation

 Much Faster service, more customer satisfaction, more sales, more revenues and profit
 Better access to service than competition , more new customers acquired , more sales, More sales

What drives the implementation of Digital Transformation?

 High competition, market saturation & globalization causing the need for business innovation. Early adopters
advantage : companies that invest in new technologies first to gain competitive advantage.
 Need to have more customer satisfaction
 The high availability of technology and its users
  The divergence of clients from brick and mortar business to electronic business and the high competition by
competitors by utilizing technology

Digitization Vs. Digitalisation :

Digital Transformation is about “Digitalization” of the business process

Types of Digitalization
Digital Innovation & Disruption

-Digital transformation causes a digital disruption to the industry or the way we do business.

This disruption is caused by new business models / business strategies that diverts from the classical / traditional
approaches of competitors or other organizations

-Digital Technologies used involve software and hardware for capturing, processing, and delivering information and
services

Main Disruptive Technologies for Digital Transformation

1. Internet of Things ( IoT)

2. Artificial Intelligence & Robotic Automation
3. Cloud Computing
4. Electronic Data Analytics / Data Mining
5. Virtual / Augmented reality + Ubiquitous Computing
6. Block Chain

What can be Digitalized?

Digital Transformation for new Business Models in the Value chain

Digital Transformation via Network Orchestration

In a network orchestration, the market entrant creates a network by linking customers with suppliers
  This business model is called: network orchestrator
 The orchestrator manages the environment and the market environment, but does not own or provide the
products themselves

Examples : Transportation like UBER , E commerce eBay / OLX

The criterion to identify Digital Transformation

-Using new and modern technologies like Artificial Intelligence (AI) or Ubiquitous Computing for business innovations
“Ubiquitous computing (or ubicomp ") is a concept in software engineering, hardware engineering and computer
science where computing is made to appear anytime and everywhere . In contrast to desktop computing, ubiquitous
computing can occur using any device, in any location, and in any format . A user interacts with the computer, which
can exist in many different forms, including laptop computers, tablets, smart phones and terminals in everyday objects
such as a refrigerator or a pair of glasses .” (causing a digital disruption)

-Only applying Enterprise Resource Planning (ERP), Customer Relationship Management (CRM) and Supply Chain
Management (SCM) without business process innovation is not enough

The History of Digital Transformation

FinTech Strategic Disruption

FinTechs are companies that provide financial services for customers using new digital techniques and approaches
 Information Systems and the Digital Transformation

Information:

Is a message, something to be communicated from the sender to the receiver. It may be a truth or a lie, or just a sound
of a whistle

System

“At arbitrary boundaries, a collection of interrelated components of a larger system

Perspectives on Information Systems

-Set of interrelated components. Collect, process, store, and distribute information. Support decision making ,
coordination , and control

-Combination of five key elements

Business Procedure

Three activities produce information organizations need

Input : Captures raw data from organization or external environment

Processing : Converts raw data into meaningful form

Output : Transfers processed information to people or activities that use it

Feedback : Output returned to appropriate members of organization to help evaluate or correct input stage

Information Systems Overview

Information Technology

 Web / Mobile
 applications
  Databases
 Artificial Intelligence
 Data analytics
 Smart robotics etc.

People

 Social aspects / effects

 Technology acceptance
 IT (projects) management
 Information management
 Policies, laws and privacy etc.

Applications

 Enterprise systems for business

 E Business / E-gov
 Business process management
 Data science (stats
 Business Intelligence

Business Processes and Information Systems

Business processes:

A set of logically related tasks and behaviors that organizations develop over time to produce specific business results
and the unique manner in which these activities are organized and coordinated

Information Management & Information Systems

Types of Information Systems

1- Transaction processing systems TPS

 Management Level : Serve operational level

 Function : Perform and record daily routine transactions necessary to conduct business
 Decision : Monitor the statues of internal operation .Predefined, structured goals and decision making
 Example : How many items in the inventory?. Point of sale systems at a supermarket

Types of TPS Systems

2- Management information systems

Management Level : Serve middle management

Function : Provide summary reports on firm s current performance , based on data from TPS

Decision :Provide answers to routine questions with predefined procedure for answering them. Typically have little
analytic capability

Example : Total salaries paid every month. Number of items produced every week in factory

3- Decision support systems DSS

Management Level: Serve middle management

Function: Support organization predictive decision making related to a particular problem What if questions. For
Business Intelligence

Decision: Support non-routine decision making. Often use external information + internal as well from TPS and MIS

Example: What is the forecasted sales in December if number of clients doubled?

Components of DSS

1. Database

Current or historical data from number of applications or groups. May be small database or large data warehouse

2. Software system

With models, data mining (e.g., linear regression models) models), other analytical tools ( e.g. OLAP and data mining)

3. User interface

Often a Web interface

4-Executive support systems ESS

Management Level: Support senior management

Function: ESS address strategic issues and long term trends

Decision: Address non routine decisions requiring judgment. Include data about external events as well as data from
internal MIS and DSS

Example: Shall we open a new branch in Dubai?. What products we should be making in five years

Dashboards

-A dashboard should summarize the main Key Performance Indicators (KPIs) for the decision to evaluate the success of
an organization.

-An organized “mashup” of reports and graphical visualizations

Example: Digital dashboard with real time view of firm’s financial performance: working capital, accounts receivable,
accounts payable, cash flow, and inventory.

The Role of Information Systems in Business Today

 Increase in wireless technology

 Internet reduced costs of operating on global scale
 Globalization opportunities

Digital firms: Which nearly all of the organization’s significant business relationships with customers, suppliers and
employees are digitally enabled

 Time shifting : working hours become 24 hours /7 days

 Space shifting : work takes place in globally (no boundaries.

Enterprise Systems

Enterprise applications

Automate processes that span multiple business functions and organizational levels and may extend outside the
organization

Four major applications:

 Enterprise systems (Enterprise Resource Planning ( ERP ),like e.g. SAP)

 Supply chain management systems
 Customer relationship management systems
 Knowledge management systems

Why Enterprise Systems

 Better coordination of daily activities (streamlined processes)

 Customer Driven: Efficient response to customer orders (production, inventory ), complaints, and demands
 Better + faster decisions: Provide more accurate & valuable information for improving management decision
making
 Cheaper to maintain than multiple independent systems

Enterprise Applications

1. Enterprise Resource Planning systems ERP

 Collects data from different firm functions and stores data in single central data repository
 Resolves problem of fragmented , redundant data sets and systems
 Enable coordination of daily activities
 Enable Efficient response to customer orders (production, inventory )
 Provide valuable information for improving management decision making
2. Supply chain management systems SCM
 Manage firm’s relationships with suppliers
 Share information about Orders , production , inventory levels , delivery of products and services
 Enable Right amount of products to destination with least amount of time and lowest cost
Supply chain management system:

1-Supply chain planning systems

Determines how much product a business needs to make and when to satisfy all of its customers’ demands

 Model existing supply chain

 Optimize sourcing , manufacturing plans
 Establish inventory levels
 Identifying transportation modes

2-Supply chain execution systems

Manage flow of products through distribution centers and warehouses to ensure products delivered to right locations
in most efficient manner

 Order commitments
 Final production
 Refill of stock
 Distribution management

3- Customer relationship management systems CRM

 Provide information to coordinate all of the business processes that deal with customers in sales , marketing ,
and service to optimize revenue, customer satisfaction , and customer retention + on boarding new clients
 Enable Integration of firm’s customer related processes
 Consolidate customer information from multiple communication channels

CRM software packages

1. Sales force automation (SFA) modules

 Enable focusing efforts on most profitable customers
 Enables sharing customer information
 Helps reduce cost per sale and cost of acquiring , retaining customers
2. Customer service modules
 Assigning and managing customer service requests. E.g. managing advice phone lines , Web site
support
3. Marketing modules
 Capturing prospect and customer data
 Providing product and service information
 Qualifying leads for targeted marketing
 Scheduling and tracking direct marketing mailings or e mail

Two main categories of CRM

Operational CRM

-Customer facing applications , e.g. tools for sales force automation, call center and customer service support ,
marketing automation
Analytical CRM

-Applications that analyze (OLAP, data mining , etc.) customer data

-One important output: Customer lifetime value (CLTV) HISTORY of CLIENT!. Value based on revenue produced by a
customer, expenses incurred in acquiring and servicing customer , and expected life of relationship between customer
and company

4-Knowledge management systems KM

 Support processes for acquiring , creating , storing , distributing , applying , integrating knowledge
 Collect internal knowledge and link to external knowledge
 Include enterprise wide systems for Managing documents , graphics and other digital knowledge objects and
directories of employees with expertise

1- Enterprise wide content management systems

Help to capture , store , retrieve , distribute documents & reports . Semi structured knowledge ( emails

2- Knowledge network systems

Provide online directory of corporate experts in well defined knowledge domains. Use communication technologies to
make it easy for employees to find appropriate expert in a company. Examples: Best practices , FAQ

3- Collaboration technologies

Portal technologies to access to external information and internal knowledge resources

Collaboration tools: E mail, Discussion groups, Blogs, Wikis, Workflow System

Learning management systems (LMS)

Provide tools for management, delivery, tracking , and assessment of various types of employee learning and training

Support multiple modes of learning: CD ROM, Web based classes, online forums, live instruction, etc.
 Information & Communication Technology (ICT) Infrastructure in the Digital Enterprise

Data Management Importance

An effective information system should provide users with accurate, timely, and relevant information. Many
businesses don’t have timely, accurate, or relevant information because the data in their information systems have
been poorly organized and maintained. That’s why data management is so essential

Organizing Data in a Traditional File Environment

The data hierarchy

Bit: Smallest unit of data; binary digit (0,1). Computers can only store bit / binary data in its memory or storage (e.g.,
on and off, or 1 or 0!). E.g., Letter ‘a’ = 01100001

Byte: Group of bits that represents a single character. Related to computer storage, e.g. 1 megabyte = 1024 Kilobyte, 1
kilobyte = 1024 Byte, etc.

Field: Group of A grouping of characters into a word, a group of words, or a complete number, such as a person's
name or age.

Records: Group of related fields, describes an entity (a person, place or thing about which information must be kept
each characteristic of an entity is an attribute

File : Group of records of the same type

Database : Group of related files

Computer systems organize data in a hierarchy that begins with bits and bytes and progresses to more complex
groupings of data

How to digitize analogue data?

 By data entry using a keyboard

 By Optical Character Recognition (OCR) scanners
 Using sensors with digital converters

Three activities of information systems that produce information that organizations need:

1. Input: Captures raw ” data from organization or external environment

2. Processing: Converts raw ” data into meaningful form (information)
3. Output: Transfers processed information to people or activities that use it, or transfers processed data to
other systems

Information Systems relate Organization with Computer Technology

Data—Information—Knowledge

Data: collection of values related to a formal schema (raw facts ”), e.g. state of variables or events within business
process

Information: data that have been shaped into a form that is meaningful and useful to human beings (in work
processes. Clearly labelled and structured data in a database
Knowledge: organizational asset how to perform business processes & create new products/services enabling the
business to create value

Database (DB)

-DB is a component inside the IS where data is centralized, managed efficiently.

-Data stored in the DBs of IS can be easily updated, changed, deleted, and retrieved.

- There is a Database Management System (DBMS) includes capabilities and tools for organizing, managing, accessing
and manipulating information in databases.

 Software that manages and administers databases + hardware (database

 Microsoft Access and other DBMS include capabilities for report generation so that the data of interest can be
displayed in a more structured format.

The Database Approach to Data Management

The Three Level Database Model

Level 1: External, conceptual or local level

 Various “ user views ” of corporate data

 Only business view of data; not technical!
 Each application program has own view

Level 2: Logical or enterprise data level

 Technical ” (human) view of all corporate data

 How to convert data to tables and fields?
 Controlled by database administrators

Level 3: Physical or storage level

 Specifies the way data is physically stored

 For a specific DBMS we choose to implement database on -Most detailed database design!
 For use by database administrators

Design steps
Four Types of Information

1. Internal record based information original focus of IS and most used in organizations : Found in databases
2. Internal document based information : Reports, emails, proposals
3. External record based information : Acquisition from external databases
4. External document based information : World Wide Web

Document Management

-Documents most common unstructured data than anything else in an organization

 Paper still plays a major role in most enterprises

 Need to move seamlessly between digital and print

-Electronic document management (EDM) uses new technologies for document management to produce significant
impacts

 Organise and label documents, metadata, descriptions, owner, creation date, etc.
 Facilitate document search and retrieval

Business Intelligence

Using Databases to Improve Business Performance and Decision Making

The data warehouse

-Data warehouse extracts current and historical data from multiple operational systems inside the organization. These
data are combined with data from external sources and reorganized into a central database designed for management
reporting and analysis. The information directory provides users with information about the data available in the
warehouse

-Data warehouses are seen as strategic assets that can yield business intelligence

, rivaling global