1.

System: A system is a set of interrelated components, with a clearly defined boundary,

working together to achieve a common set of goals. 2. Input: Involves capturing and assembling elements that enter the system to be processed. E.g. raw material, energy, data and human efforts must be secured and organised for processing. 3. Software Resources: Software resources include all sets of information processing instructions. This software includes not only the sets of operating instructions called programs, which direct and control computer hardware, but also the sets of information processing instructions called procedures that people need. The following are examples of software resources:

System software, such as an operating system program, which controls and supports the operations of a computer system. Application software, which are programs that direct processing for a particular use of computers by end users. Examples are a sales analysis program, a payroll program, and a word processing program. Procedures, which are operating instructions for the people who will use an information system. Examples are instructions for filling out a paper form or using a software package.

4. System software, such as an operating system program, which controls and supports

the operations of a computer system. 5. Data versus Information: Data versus Information. The word data is the plural of datum, though data commonly represents both singular and plural forms. Data are raw facts or observations, typically about physical phenomena or business transactions. For example, a spacecraft launch or the sale of an automobile would generate a lot of data describing those events. More specifically, data are objective measurements of the attributes (the characteristics) of entities (such as people, places, things, and events).

6. Network infrastructure This generic category emphasizes that many hardware,

software, and data technologies are needed to support the operation and use of a communications network. Examples include communications processors such as modems and internetwork processors, and communications control software such as network operating systems and Internet browser packages.
7. Communications media: Examples include twisted-pair wire, coaxial and fibre-optic

cables; and microwave, cellular, and satellite wireless technologies. 8. Application Software: which are programs that direct processing for a particular use of computers by end users. Examples are a sales analysis program, a payroll program, and a word processing program.

9. Hardware: The equipment that processes the data to create information is called hardware. It includes the keyboard, mouse, monitor, system unit, and other devices. Hardware is controlled by software. 10.System unit: the system unit, also known as the system cabinet or chassis, is a container that houses most of the electronic components that make up a computer system. Two important components of the system unit are the microprocessor and memory. The microprocessor controls and manipulates data to produce information. Many times the microprocessor is contained within a protective cartridge. Memory, also known as primary storage or random access memory (RAM), holds data and program instructions for processing the data. It also holds the processed information before it is output. Memory is sometimes referred to as temporary storage because its contents will typically be lostif the electrical power to the computer is disrupted. 11. Computer hardware: Hardware for a microcomputer system consists of a variety of

different devices. This physical equipment falls into four basic categories: system unit, input/output, secondary storage, and communication: 12. Computer software: Computer software technologies, including operating
system software, Web browsers, software productivity suites, and software for business applications like customer relationship management and supply chain management 13. Telecommunications/Networking:including the telecommunications media, processors, and software needed to provide wire-based and wireless access and support for the Internet and private internet-based networks such as intranets and extranets. 14. Database: A database is a group of related files. 15. Database management system: A database management system (DBMS) is software

that permits an organization to centralize data, manage them efficiently, and provide access to the stored data by application programs. The DBMS acts as an interface between application programs and the physical data files. 16. Hierarchical database model: The hierarchical DBMS presents data to users in a treelike structure. Think of a mother and her children. A child only has one mother and inherits some of her characteristics, such as eye colour or hair colour. A mother might have one or more children to whom she passes some of her characteristics but usually not exact ones. The child then goes on to develop her own characteristics separate from the mother. In a hierarchical database, characteristics from the parent are passed to the child by a pointer, just as a human mother will have a genetic connection to each human child. You can demonstrate this concept to students by showing them how this database pointer works by illustrating the simple hierarchy illustrated below 17. Attributes
18. Primary key : A primary key, a unique identifier for each record in a relational

database. To make sure the tables relate to each other, the primary key from one table is stored in a related table as a secondary key. For instance, in the customer table the
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primary key is the unique customer ID. That primary key is then stored in the order table as the secondary key so that the two tables have a direct relationship.

19. Foreign key 20. Data mart: Since the data warehouse can be cumbersome, a company can break the information into smaller groups called data marts. Its easier and cheaper to sort through smaller groups of data. Its still useful to have a huge data warehouse, though, so that information is available to everyone who wants or needs it. 21. Data governance: Data governance deals with the policies and processes for managing the availability, usability, integrity, and security of the data employed in an enterprise, with special emphasis on promoting privacy, security, data quality, and compliance with government regulations. 22. Data cleansing: Data cleansing also known as data scrubbing can detect and correct data and enforce consistency among different sets of data 23. Information Flow: Each level of management has different information needs. Toplevel managers need information that is summarized in capsule form to reveal the overall condition of the business. They also need information from outside the organization, because top-level managers need to forecast and plan for long range events. Middle-level managers need summarized information weekly or monthly reports. They need to develop budget projections as well as to evaluate the performance of supervisors. Supervisors need detailed, very current, day-to-day information on their units so that they can keep operations running smoothly.

QUESTION 1 Explain the Fundamental Roles Of Is In Business.

The Fundamental Roles Of Is In Business

There are three fundamental reasons for all business applications of information technology. They are found in the three vital roles that information systems can perform for a business enterprise. Support of its business processes and operations. Support of decision making by its employees and managers. Support of it strategies for competitive advantage.

1. Support Business Processes As a consumer, you regularly encounter information systems that support the business processes and operations at the many retail stores where you shop. For example, most retail stores now 3

use computer-based information systems to help them record customer purchases, keep track of inventory, pay employees, buy new merchandise, and evaluate sales trends. Store operations would grind to a halt without the support of such information systems.

2. Support Decision Making Information systems also help store managers and other business professionals make better decisions. For example, decisions on what lines of merchandise need to be added or discontinued, or on what kind of investment they require, are typically made after an analysis provided by computer-based information systems. This not only supports the decision making of store managers, buyers, and others, but also helps them look for ways to gain an advantage over other retailers in the competition for customers.

3. Support Competitive Advantage Gaining a strategic advantage over competitors requires innovative application of information technologies. For example, store management might make a decision to install touch-screen kiosks in all of their stores, with links to their e-commerce website for online shopping. This might attract new customers and build customer loyalty because of the ease of shopping and buying merchandise provided by such information systems. Thus, strategic information systems can help provide products and services that give a business a comparative advantage over it competitors.

QUESTION 2 Briefly explain the components Of An Information System

Components Of An Information System

People, hardware, software, data, and networks are the five basic resources of information systems. People resources include end users and information system (IS) specialists, hardware resources consist of machines and media, software resources include both programs and procedures, data resources can include data and knowledge bases, and network resources include communications media and networks. Data resources are transformed by information processing activities into a variety of information products for end users. Information processing consists of the system activities of input, processing, output, storage, and control.
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QUESTION 3 How can a business use ICT as a competitive force in the market place? A company can survive and succeed in the long run only if it successfully develops strategies to confront five competitive forces that shape the structure of competition in its industry. In Michael Porters classic model of competitive strategy, any business that wants to survive and succeed must develop and implement strategies to effectively counter:
(1) The rivalry of competitors within its industry, (2) The threat of new entrants into an industry and its markets, (3) The threat posed by substitute products which might capture market share (4) The bargaining power of customers, and (5) The bargaining power of suppliers

Competitors share a natural, and often healthy, rivalry. This rivalry encourages and sometimes requires a constant effort to gain competitive advantage in the marketplace. This ever-present competitive force requires significant resources on the part of a firm. Guarding against the threat of new entrants also expends significant organizational resources. Not only do firms need to compete with the other firms in the marketplace, but they must also work to create significant barriers to the entry of new competition. This competitive force is often a difficult one to manage because the internet has created many ways for a new entrant to enter the marketplace quickly and with relatively low cost of entry. In the internet world, a firms biggest potential competitor may be one that is not yet in the marketplace but could emerge, almost literally, overnight. The threat of substitutes is another competitive force confronting a business. The effect of this force is seen almost daily in a wide variety of industries. It is often at its strongest during periods of rising costs or inflation. When airline prices get too high, people substitute car travel on their vacations. When the cost of steak gets too high, people eat more hamburger and fish. There are very few products or services that do not have some sort of substitute available to the consumer. Finally, a business must guard against the often opposing forces of customer and supplier bargaining powers. If the customers bargaining power gets too strong, they can drive prices to unmanageably low levels or simply refuse to buy the product or service. If a key suppliers bargaining power gets too strong, it can force he price of goods and services to unmanageably high levels or can simply starve a business by controlling the flow of parts or raw materials essential to the manufacture of a product.
Cost leadership strategy. Becoming a low-cost producer of products and services in the industry, or finding ways to help its suppliers or customers reduce their costs or to increase the costs of their competitors. 5

Differentiation strategy. Developing ways to differentiate a firms products and services from its competitors or reduce the differentiation advantages of competitors. This may allow a firm to focus its products or services to give it an advantage in particular segments or niches of a market. Innovation strategy. Finding new ways of doing business. This may involve the development of unique products and services, or entry into unique markets or market niches. It may also involve making radical changes to the business processes for producing or distributing products and services that are so different from the way a business has been conducted that they alter the fundamental structure of an industry. Growth strategies. Significantly expanding a companys capacity to produce goods and services, expanding into global markets, diversifying into new products and services, or integrating into related products and services. Alliance strategies. Establishing new business linkages and alliances with customers, suppliers, competitors, consultants, and other companies. These linkages may include mergers, acquisitions, joint ventures, forming of virtual companies, or other marketing, manufacturing, or distribution agreements between a business and its trading partners.

QUESTION 4 How can information technology support a companys business processes and decision making?
Support Business Processes As a consumer, you regularly encounter information systems that support the business processes and operations at the many retail stores where you shop. For example, most retail stores now use computer-based information systems to help them record customer purchases, keep track of inventory, pay employees, buy new merchandise, and evaluate sales trends. Store operations would grind to a halt without the support of such information systems.

Support Decision Making Information systems also help store managers and other business professionals make better decisions. For example, decisions on what lines of merchandise need to be added or discontinued, or on what kind of investment they require, are typically made after an analysis provided by computer-based information systems. This not only supports the decision making of store managers, buyers, and others, but also helps them look for ways to gain an advantage over other retailers in the competition for customers. 6

QUESTION 5 How can information technology be used to give a company competitive advantage?

Other Competitive Strategies

There are many other competitive strategies in addition to the five basic strategies of cost leadership, differentiation, innovation, growth, and alliance. Lets look at several key strategies that are also implemented with information technology. They are: locking in customers or suppliers, building switching costs, raising barriers to entry, and leveraging investment in information technology. Basic Strategies in the Business Use of Information Technology Lower Cost
Use IT to substantially reduce the cost of business processes Use IT to lower the costs of customers or suppliers

Differentiate
Develop new IT features to differentiate products and services Use IT features to reduce the differentiation advantage of competitors Use IT features to focus products and services at selected market niches

Innovate
Create new products and services that include IT components Develop unique new markets or market niches with the help of IT Make radical changes to business processes with IT that dramatically cut costs, improve quality, efficiency, or customer service, or shorten time to market

Promote Growth
Use IT to manage regional and global business expansion Use IT to diversify and integrate into other products and services

Develop Alliances
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 Use IT to create virtual organizations of business partners Develop inter-enterprise information systems linked by the Internet and extranets that support strategic business relationships with customers, suppliers, subcontractors, and other.

QUESTION 6 What are the four kinds of computer-based information systems?

Computer-Based Information Systems

There are four kinds of computer-based information systems: transaction processing system, management information system, decision support system, and executive support system. Almost all organizations have computer-based information systems. Large organizations typically have formal names for the systems designed to collect and use the data. Although different organizations may use different names, the most common names are transaction processing, management information, decision support, anexecutive support systems.
i. Transaction processing system: the transaction processing system (TPS) records day-to-day transactions such as customer orders, bills, inventory levels, and production output. The TPS helps supervisors by generating databases that act as the foundation for the other information systems.

ii.

Management information system: the management information system (MIS) summarizes the detailed data of the transaction processing system in standard reports for middle-level managers. Such reports might include weekly salesand production schedules.

iii.

Decision support system: The decision support system (DSS) provides a flexible tool for analysis. The DSS helps middle-level managers and others in the organization analyze a wide range of problems, such as the effect of events and trends outside the organization. Like the MIS, the DSS draws on the detailed data of the transaction processing system. Executive support System: The executive support system (ESS), also known as the executive information system (EIS), is an easy-to-use system that presents information in a very highly summarized form. It helps toplevel managers oversee the companys operations and develop strategic plans. The ESS combines the internal data from TPS and MIS with external data. 8

iv.

QUESTION 7 What is the difference between an office automation system and a knowledge work system?
Office automation systems: office automation systems (OASs) are designed primarily to support data workers. These systems focus on managing documents, communicating, and scheduling. Documents are managed using word processing, Web authoring, desktop publishing, and other image technologies. Project managers are programs designed to schedule, plan, and control project resources. Microsoft project is the most widely used project manager. Videoconferencing systems are computer systems that allow people located at various geographic locations to communicate and have in-person meetings. Knowledge work systems: knowledge workers use OAS systems. Additionally, they use specialized information systems called knowledge work systems (KWSs) to create information in their areas of expertise. For example, engineers involved in product design and manufacturing use computer-aided design/computer-aided manufacturing (CAD/CAM) systems. These KWSs consist of powerful microcomputers running special programs that integrate the design and manufacturing activities. CAD/CAM is widely used in the manufacture of automobiles and other products.

QUESTION 8 What strategic role can information play in business process reengineering?

The Role Of Information Technology

Information technology plays a major role in reengineering most business processes. The speed, information processing capabilities, and connectivity of computers and Internet technologies can substantially increase the efficiency of business processes, as well as communications and collaboration among the people responsible for their operation and management. For example, the order management process illustrated is vital to the success of most companies. Many of them are reengineering this process with enterprise resource planning software and Web-enabled electronic business and commerce systems. Reengineering Order Management
Customer relationship management systems using corporate intranets and the internet Supplier managed inventory systems using the Internet and extranets Cross-functional ERP software for integrating manufacturing, distribution, finance, and human resource processes Customer-accessible e-commerce websites for order entry, status checking, payment, and service

 Customer, product, and order status databases accessed via intranets and extranets by employees and suppliers

QUESTION 9 How could a business use internet technologies to form virtual company or become an agile competitor?

Creating A Virtual Company

In todays dynamic global business environment, forming a virtual company can be one of the most important strategic uses of information technology. A virtual company (also called a virtual corporation or virtual organization) is an organization that uses information technology to link people, organizations, assets, and ideas. Notice that this company has organized internally into clusters of process and cross-functional teams linked by intranets. It has also developed alliances and extranet links that form interenterprise information systems with suppliers, customers, subcontractors, and competitors. Thus, virtual companies create flexible and adaptable virtual workgroups and alliances keyed to exploit fast-changing business opportunities.

QUESTION 10 How could a business use information technology to increase switching costs? Investments in information technology can allow a business to lock in customers and suppliers (and lock out competitors) by building valuable new relationships with them. These business relationships can become so valuable to customers or suppliers that it deters them from abandoning a company for its competitors, or intimidating it into accepting less-profitable business arrangements. Early attempts to use information systems technology in these relationships focused on significantly improving the quality of service to customers and suppliers in a firms distribution, marketing, sales, and service activities. More recent projects characterize a move toward more innovative uses of information technology. A major emphasis in strategic information systems has been to find ways to build switching costs into the relationships between a firm and its customers or suppliers. That is, investments in information systems technology, such as those mentioned in the Wal-Mart example, can make customers or suppliers dependent on the continued use of innovative, mutually beneficial inter-enterprise information systems. Then, they become reluctant to pay the costs in time, money, effort, and inconvenience that it would take to switch to a companys competitors.

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QUESTION 11 Explain the five parts of an information system. An information system has five parts: people, procedures, software, hardware, and data.
People: it is easy to overlook people as one of the five parts of a microcomputer system. Yet this is what microcomputers are all about making people, end users like you, more productive. Procedures: the rules or guidelines for people to follow when using software, hardware, and data are procedures. These procedures are typically documented in manuals written by computer specialists. Software and hardware manufacturers provide manuals with their products. These manuals are provided either in printed or electronic form. Software: A program consists of the step-by-step instructions that tell the computer how to do its work. Software is another name for a program or programs. The purpose of software is to convert data (unprocessed facts) into information (processed facts. For example, a payroll program would instruct the computer to take the number of hours you worked in a week (data) and multiply it by your pay rate (data) to determine how much you are paid for the week (information). Hardware: The equipment that processes the data to create information is called hardware. It includes the keyboard, mouse, monitor, system unit, and other devices. Hardware is controlled by software. Data: The raw, unprocessed facts, including text, numbers, images, and sounds are called data. Processed, data yields information. Sung the example above, the data (number of hours worked and pay rate) are processed (multiplied) to yield information (weekly pay).

QUESTION 12 What are the problems with the traditional file environment?

Problems With Traditional File Environment

Many problems such as data redundancy, data inconsistency, program-data dependence, inflexibility, poor data security, and of data sharing and availability among applications have occurred with traditional file environments.

Data Redundancy and Inconsistency Data Redundancy and Inconsistency depicts the concept of islands of information. Building and maintaining databases is where this situation is most evident and most troublesome. Usually it begins in all innocence, but it can quickly grow to monstrous proportions.
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For instance, after you move and change addresses, you notify every one of your new address including your bank. Everything is going smoothly with your monthly statements. All of a sudden, at the end of the year, the bank sends a Christmas card to your old address. Why? Because your new address was changed in one database, but the bank maintains a separate database for its Christmas card list and your address was never changed in it. If you received two Christmas cards, youre probably a victim of data redundancy. That is, your information is now in two separate databases with duplicate records. In this instance, each database file has different data on the same record. That can be a nightmare on Main Street! It is easy to see that the problem with data redundancy is that it wastes storage resources. Another problem with data redundancy is that it will also lead to data inconsistency. In the Christmas card example illustrated above, the address field in the two databases has two different values.

Program-Data Dependence Even more troublesome is when several departments or individuals decide to set up their own islands of information. This usually happens because they find the main system inflexible or it just doesnt fit their needs. So they set up their own fields and records and files and use them in their own programs to manipulate data according to their needs. Now each department is spending dollars and time to establish and maintain islands of information because of programdata dependence. Taking this problem even further, the fields and records for marketing probably dont have the same structure and meaning as the fields and records for accounting, or those for production. Each record describes basically the same entity (customers or products), but it is very possible that each database file will have different information, or attributes, in records concerning the same entity. All of this may happen with the best of intentions. All departments began with the goal of making their part of the organization more efficient. Eventually these good intentions can cost big cedis to bring the islands together, resolve data conflicts, and retrain people to understand the new database structures. Lack of Flexibility A traditional file system can deliver routine scheduled reports after extensive programming efforts, but it cannot deliver ad hoc reports or respond to unanticipated information requirements in a timely fashion. To send Christmas cards to every person in the database would be programmed and easily executed. However, lets assume that you only want to send Christmas cards out to individuals who are 55 years old and live in Kumasi. This ad hoc request will not be easy to retrieve. Poor Security

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Because there is little control or management of data, access to and dissemination of information may be out of control. Management may have no way of knowing who is accessing or even making changes to the organizations data. Lack of Data Sharing and Availability Pieces of information in different files and different parts of the organization cannot be related to one another. This situation makes it virtually impossible for information to be shared or accessed in a timely manner

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