1.

Emergence of the global economy: The success of firm today and in the future depends on their ability to operate globally Today information system provides the communication and analytic power that firm needs for conducting trade and managing business on a global scale. Globalization and IT also brings new threats to domestic business firm. Because of global communication and management system customers now can shoo in a worldwide mar!et place obtaining price and "uality information reliably #$ hrs a day. To obtain competitive participants in international mar!et firms need powerful information and communication systems. #. Transformation of industrial economies: The %& 'apan Germany and other ma(or industrial powers are being transformed from industrial economies t !nowledge and information based service economies whereas manufacturing has been moving to low)wage countries. *nowledge and information wor! new accounts for large percentage of people in developed countries. *nowledge and information are becoming the foundation for mainly new services and products !nowledge and information intense products such as computer games re"uire a great deal of !nowledge to produce. In a !nowledge and information based economy information technology and systems ta!e on great importance !nowledge based products and services of great economic value such as credit cards overnight pac!age delivery and worldwide reservation systems are based on new information technology. Information systems are needed to optimize the flow of information and !nowledge within the organization and to help management ma+imize the firm,s !nowledge resource. Because employees productivity depends on the "uality of the system,s serving them management,s decisions about IT are critically important to the firm,s prosperity and survival. -. Transformation of business enterprise: The traditional business firm was and still is a hierarchical centralized structured structured arrangement of specialist that typically relies on a fi+ed set of standard operating procedures to deliver a master)produced product .or services/.the new style of the business firm is a flattened.less hierarchical/ decentralized fle+ible arrangement of generalist who rely on nearly instant information to deliver mass)customized products and services uni"uely suited to specific mar!ets or customers The traditional management globe relies and still relies on formal plants or rigid division of the labor and formal rules. The new manager relies on informal commitments and networ!s to establish goals rather than formal planning a fle+ible arrangement of teams and individuals wor!ing in tas! forces and a customer orientation to achieve coordination among employees. The new manager appeals to the !nowledge learning and decision ma!ing of individual employees to ensure proper operation of the firm. Information technology ma!es this type of management possible.

$. The emerging digital firm: Intensive use of information technology in business firms since mid)1001 coupled with e"ually significant organization re)designed has created the conditions for a new phenomenon I industrial society called the fully digital firm. The digital firm can be defined along several dimensions. 2 digital firm is one where 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 networ!s spanning entire organization or lin!ing multiple organizations. Business processes refer to the uni"ue manner in which wor! is organized coordinated and focused to produce a valuable product or services. 3eveloping a new product generating and fulfilling an order or hiring an employee are e+amples of business processes and the way organizations accomplish their business processes can be a source of competitive strength. In a digital firm any piece of information re"uired to support !ey business decisions is available at anytime and anywhere in the firm. 3igital firms sense and respond to their environment for more rapidly than traditional firms. 3igital firms offer e+traordinary opportunities for more global organization and management. 4or manager,s of digital firms information technology is not simply a useful handmaiden an enabler but rather it is the core of the business and primary management tool. There are four ma(or system that help define the digital firm: 1. &upply chain management system #. 5ustomer relationship management system -. Enterprise system $. *nowledge management systems

These four systems represent the areas where cooperation are digitally integrating their information flows and ma!ing ma(or information system investment. 2 few firms such as 5isco systems or 3ell computer cooperation are close to becoming fully digitl firms using the internet to drive every aspect of their business.

1. &upply chain management system: Information system that automate the relationship between a firm and its supplies in order to optimize the planning sourcing manufacturing and delivery of products and services. #. 5ustomer relationship management system: Information systems for creating a coherent integrated view of all the relationships a firm maintains with its customers.

-. Enterprise system: Integrated enterprise) wide information systems that coordinate !ey internal processes of the firm integrating data from manufacturing and distribution finance sales and human resources. $. *nowledge management system: &ystems that support the creation capture storage of !nowledge in the firm and use by the firm e+pertise. &uppliers Environment :rganization Information system Inputs 9rocessing 5lassify 2rrange calculate 4eedbac! 8egulatory agencies 5ompetitors :utput 5ustomers

&toc!holder

1.6.1 4ig: 4unctions of an information system 2n information system contents information about an organization and its surrounding environment. Three basic activities 7 input processing and output produce the information organization needs feedbac! is output returned to appropriate people or activities in the organization to evaluate and refine the input environment factors such as customers suppliers competitors stoc! holders and regulatory agencies interact with the organization and its function.

Information system Business 9rocess

Transfor matin Info. Business system

3ata collect ion and storag e

&upply customer enterprise chain mgmt mgmt mgmt

!nowledge mgmt

3i ss e mi na tio n

4irm profitability and strategic position

Info. 9rocessing activities

9lanning coordinating controlling <anagement activities

modeling ;decision ma!ing

Business value 1.6.# 4ig: The business information value chain

4rom business perspective information systems are part of a value adding activities for ac"uiring transformation and distributing information that managers can use to improve decision ma!ing enhance organizational performance and ultimately increase firm profitability and strategic position. Integrating te+t with technology: =ew opportunities for learning >www.prenhall.com?laudon

:rganisation Technology

I.&.

<anagement

1.6.- 4ig: Information systems are more than computers %sing information systems effectively re"uires an understanding of the organization management and information technology shaping the systems. 2ll information systems can be described as organizational and management solutions to challenges posed by the environment that will help create value for the firm. 1.@ 5ontemporary approach to information system Technical approach

5omputer science 8esearch

:perations

<anagement &cience sociology <I&

9sychology Technical 2pproach:

Economics

Behavioral approach

It emphasis mathematically based models to study information system as well as the physical technology and formal capabilities of these system. The disciplines that contribute to technical approach are computer science management science and operation. 5omputer science is concerned with establishing theories of computability methods of computation and methods of efficient data storage and access. <anagement science emphasis the development of models for decision ma!ing and management practices. :perations research focuses on mathematical techni"ues for optimizing selected parameters of organization such as transportation inventory control and transaction cost.

Behavioral approach: It is concerned with behavioral issues that arise in the development and long term maintenance of information system. Issues such as strategic business integration design implementation utilization and management cannot be e+plored usefully with the models used n technical approach. :ther behavioral contribute important concepts and methods such as sociology psychology economics. &ociologist study information systems with an eye towards how groups and organizations shape the development of the system and also how system affects individuals groups and organizations. 9sychologist study information system with an interest in how human decision ma!ers perceive ad use formal information. Economist study information system with an interest in what impact systems have on control and cost structures with the firm and within mar!ets. Behavioral approach does not ignore technology indeed information systems technology is often the stimulus for a behavioral problem or issues. 4ocus of behavioral approach is generally not on technical solutions instead it concentrates on attitudes management and organizational policy and behavioral. The challenges of I&: 1. The strategic business challenge #. The globalization challenge -. The information architecture and infrastructure challenge $. The information system investment challenge 6. The responsibility and control challenge

1. The strategic business challenge: ) 8ealization the digital firm: Aow can business use information technology to become competitive effective and digitally enabledB )creating a digital firm and obtaining benefits is a long and difficult (ourney for most organization. )despite heavy information technology investment organizations are not realizing significant business value from system nor are they becoming digitally enables. #. The globalization challenge: )how can firms understand the business and system re"uirements of global economic environmentB -. The information architecture infrastructure challenge: )how can organization develop an information architecture and information technology infrastructure that can support their goals when business conditions and technologies are changing so rapidly. $. The info. &ystem investment challenge: )how can organization determine the business value of information systemB 6. The responsibility and control challenge: )how can organizations ensure that their information systems are used in an ethically and socially and responsible mannerB

4IG: page 1- *ey challenges:

5hapter # <anagement Information system #.1 ma(or types of systems in organizations: T9& <I& 3&& E&& #.1.1 8elationship of systems to one another #.1.# &ystems from functional perspectives #.1.- &ales and mar!eting manufacturing and production system finance and accounting system human resource system #.# integrating functions and business process: introduction to enterprise applications #.- businesses process and I& #.$systems for enterprise)wide process integration #.6 :verview of enterprise applications #.6.1 :verview of enterprise systems #.6.# :verview of supply chain management systems 4IG: types of information systems :rganizations can be divided into strategic management !nowledge and operational levels and into 6 ma(or functional areas) sales and mar!eting manufacturing finance accounting and human resource information system serve each of these levels ad functions. 4IG: types of information systems. 4IG: interrelationship among systems The various types of systems in the organization have interdependencies. T9& are ma(or producers of information .i.e. re"uired by the other system which in turn produce information for each other systems. These different types of systems are only loosely coupled in most organizations. Types of I& 1. T9& .Transaction processing system/:) T9& are the basic business systems that serve the operational level of the organization. 2 T9& is a computerized system that performs and records the daily routine transactions necessary to conduct business. E+amples are sales order entry hotel reservation system payroll employee record !eeping etc. <anagers need T9& to monitor the status of internal operations and firm,s relations with e+ternal environment.T9& are also measure producers of information for the other type of system.

#. *C& .*nowledge wor! system/ and office systems: *C& and office systems serve the information needs at the !nowledge level of organization. *nowledge wor!s system aid !nowledge wor!ers whereas office systems primarily aid data wor!ers. *nowledge wor!ers are people who hold formal university degrees who are often members of recognized profession such as engineers doctors lawyers scientists etc. there (obs consists primarily of creating new information and !nowledge. 3ata wor!ers typically have less formal advanced educational degrees and tend to process rather that create information. They consist primarily of secretaries boo!)!eepers filing cler!s or managers hose (ob are principally to use and manipulate information. -. <I&:) It is the information system at the management level of an organization that serve the functions of planning controlling and decision ma!ing by providing routine summary and e+ception reports. <I& serve the management level of organization as stated above with online access to the organization,s current performance and historical records. Typically they are oriented almost e+clusively to internal not environmental or e+ternal events.<I& depends on T9& for their data. It summarizes and report on the company,s basic operations.<I& usually serve manager,s interested in wee!ly monthly and yearly results not day to day activities. 6. 3ecision support system:) It is the information system at the organizations management level that combines data and sophisticated analytical models or data analysis tools to support semi)structured and unstructured decision ma!ing. 3&& use internal information from T9& and <I& they often bring information from e+ternal sources such as current stoc! prices or product prices of competitors. 3&& have more analytical power than other systems. It is an interactive system in which user can change assumptions as! new "uestions and include data. 6. E&& .E+ecutive support system/:) It is the information system at the organizations strategic level designed to address unstructured decision ma!ing through advanced graphic and communication. E&& are designed to incorporate data about e+ternal events such as new ta+ laws and competitors. They filter compress and trac! critical data emphasizing the reduction of time and effort re"uired to obtain information useful to e+ecutives. E&& employs the most advanced graphic software and can deliver graphs and data from many sources immediately to a senior e+ecutive,s office or to a board room. > according to functions or behavior I& can be divided into following types:) 1. &ales and mar!eting system #. <anufacturing and production system -. 4inance and accounting system

$. Auman resource management system 1. &ales and mar!eting:) The sales and mar!eting function is responsible for selling the organizations product or service. <ar!eting is concerned with identifying the customers for the firms products or services determining what they need or want planning and developing products and services to meet their needs and advertising and promoting these products and services. &ales are concerned with contacting customers selling the products and services ta!ing orders and following up on sales. &ales and mar!eting information system support these activities. E+ample &ystem :rder processing <ar!et analysis 3escription Enter process and trac! orders. Identify customers and mar!et using data on demographics mar!ets customer behavior and trends. 3etermine prices for products and services. 9repare 6)year sales forcast :rganizational level :perational level *nowledge level

9ricing analysis

<anagement

&ales trend forecasting

strategic

#. <anufacturing and production system: The manufacturing and production functions responsible for actually producing the firm,s goods and services. <anufacturing and production system deal with the planning development and maintenance of production facilitiesD the establishment of production goals the ac"uisition storage and the availability of production materialsD and scheduling of e"uipment facilities materials and labor re"uire to fashion finished products. <anufacturing and production information system support these activities.

&ystem <achine control

3escription 5ontrol the actions of machine and e"uipment. 3esign new products using the computer

:rganizational level :perational

5omputer) aided design.523/

*nowledge

9roduction planning

3ecide when and how many products should be produced 3ecide where to locate new production facilities.

<anagement

4acilities location

strategic

-. 4inance and accounting system:) The finance function is responsible for managing the firms, financial assets such as cash stoc!s bonds and other investments in order to ma+imize the return on these financial assets. The finance function is also in charge of managing the capitalization of the firm .finding new financial asset in stoc!s bonds or other form of debts/. In order to determine where the firm is getting the best returns on its investment the finance function must obtain a considerable amount of information from sources e+ternal to the firm. The accounting function is responsible for maintaining and managing the firm,s financial records)receipts depreciation payroll to account for the flow of funds in a firm. 4inance and accounting share related problems such as how to !eep trac! of firm,s financial assets and fund flows. 4inance and accounting information system !eep trac! of the firm,s financial assets and fund flows. &ystem 2ccounts receivable 3escription Trac! money owed the firm :rganizational :perational

9ortfolio analysis

3esign the firm,s portfolio of investment. 9repare short term budgets

*nowledge

Budgeting

<anagement

9rofit planning

9lan long term profit.

strategic

6. Auman resource management:) The human resource function is responsible for attracting developing and maintaining the firm,s wor!force. Auman resources information systems support activities such as identifying potential employees maintaining complete records on e+isting employees and creating programs to develop employee,s talent and s!ills. &ystem Training and development 3escription Trac! employee training s!ills and performance appraisals. 3esign career paths for employees. <onitor the range and distribution of employee wages salary and benefits. 9lan the long term labor force needs of the organization. :rganizational level :perational

5areer pathing

*nowledge

5ompensation analysis

<anagement

Auman resource planning

&trategic

4IG: traditional view system .page ##/ In most organizations separate systems built over a long period of time support discrete processes and discrete business functions. Integrating function and business process:) 4unctional area <anufacturing and production &ales and mar!eting Business process 2ssembling the product chec!ing for "uality bills of materials.

Identifying customers ma!ing customer aware of the product selling the product. 9aying creditors creating financial statements managing cash accounts. Airing employee,s evaluating employee,s (ob performance enrolling employees in benefits plan.

4inance and accounting Auman resource

4IG: the order fulfillment process .9age no: #-/

Generating and fulfilling an order is a multistep process involving activities performed by the sales manufacturing and production and accounting function. 4IG: enterprise system .page no: #-/ Enterprise system can integrate the !ey business processes of an entire firm into a single software system that allows information to flow easily throughout the organization. These systems focus primarily on the internal processes but may include transactions with customers and vendors. Enterprise system provide a technology platforms here organization can integrate and coordinate their ma(or internal business processes. They address the problem of organizational inefficiencies created by isolated island of information business processes and technology. 2 large organization typically has many different !inds of information systems that support different !inds of information systems that support different functions organizational levels and business processes. <ost of these systems are built around different functionsD business units and business processes that do not tal! to each other. <anagers might have a hard time assembling the data they need for a comprehensive overall picture of the organizations operations. Enterprise systems also !nown as enterprise resource planning .E89/ systems solve the above mentioned problem by providing a single information system for an organization) wide coordination of !ey business processes. The enterprise systems collects data from various !ey business processes and stores the data in a single comprehensive data repository where they can be used by other parts of business. <anagers emerge with more precise and timely information for coordinating the daily operations of the business and firm)wide view of business processes and information flows. Benefits of enterprise systemB 5hallenges of enterprise systemB 4IG: a supply chain .9age #6/ The above figure illustrates the ma(or entities in the supply chain and the flow of information upstream and downstream to coordinate the activities involved in buying ma!ing and moving a product suppliers transform raw materials into intermediate products or components and then manufacturers turn them into finished products. The products are shipped to distribution centers and from there to retailers and customers. The supply chain is a networ! of an organizations and business processes for procuring materials transforming raw materials into intermediate and fnished products and distributing the finished products to customers. The supply chai includes reverse logistics in which retured items flow in the reverse direction form the buyers bac! to the sellers. The upstream portion of supply chain includes the organizations suppliers and their suppliers and the processes for managing relationship with them. The downstream portion consists o the organization and processes for distributing and delivering products to their final customers.

-. :rganizations and information systems

-.1 Chat is an organizationB -.# common features of organizations -.- uni"ue features of organization 4IG: relationship between an organization and IT .page #@/ Information systems and organizations influence one another. Information system must be aligned with the organization to provide information that important groups within the organization need. 2t the same time the organization must be aware of and be open to the influences of information systems in order to benefit from new technologies. The interaction between IT and organizations is very comple+ and is influence by a great many mediating factors including organizations structure standard operating procedure politics culture surrounding environment and management decisions. Chat is an organizationB 4IG: technical microeconomic definition of organization .page #E/ 2n organization is a stable formal social structure that ta!es resources from the environment and processes them to produce outputs. This technical definition focuses on three elements of an organization. 5apital and labor are primary production factors provided by the environment. The organization .the firm/ transforms these inputs into products and services in a production function. The products and services are consumed by the environment in return for supply inputs. 2n organization is more stable than informal groups in terms of longevity and routineness. :rganizations are formal legal entities with internal rules and procedures that must abide by laws. :rganizations are also socio structures because they are a collection of social elements. 4IG: the behavioral view of organization .9age #F/ 2 more realistic behavioral definition of an organization is that it is a collection of rights privilege obligations and responsibilities that are delicately balanced over a period of time through conflict and conflict resolution. In this behavioral view of firm people who wor! in organizations develop ways of wor!ingD they gain attachments to e+isting relationshipD and they ma!e arrangements and subordinates and superior about how wor! will be done how much wor! will be done and under what condition. Aow do these definitions of organization relate to information system technologyB 2ns: a technical view of organizations encourages us to focus on the way inputs are combined into outputs when technology changes are introduced into the company. The firm is seen as infinitely moveable with capital and labor substituting for each other "uite easily. But the more realistic behavioral definition of an organization suggest that building new information systems or rebuilding old ones involves more than a technical rearrangement of machines or wor!ers) thata some information system that change the organizational balance of rights privilege obligations responsibilities and feeling that have been established over a long period of time.

5ommon features of organizations

)clear division of labor )hierarchy )e+plicit rules and procedures )impartial (udgments )technical "ualifications for positions )ma+imum organization efficiency 2ccording to <an Ceber all modern bureaucracies have a clear cut division of labor and specialization. :rganizations arrange special hierarchy of authority in which everyone is accountable to someone and authority is limited to specific actions. 2uthorities and actions are further limited by abstract rules and procedures .standard operating procedure .61 8s.// that are interpreted and applied to specific cases. These rules create a system of impartial and universal decision ma!ingD everyone is treated e"ually. :rganizations try to hire and promote employees on the basis of technical "ualifications and professionalism .not personal connection/. The organization is devoted to the principle of efficiency: ma+imizing output using limited inputs. In addition to Ceber,s common features all organizations develop &:9 organizational politicis and organizational culture %ni"ue features of organizations :rganizational Type Environment Goals 9ower 5onstituencies 4unction Geadership Tas!s Technology Business processes

:rganizational type 1. Entrepreneurial type)H small start up business. #. <achine bureaucracy)Hmiddle size manufacturing firms -. 3ivisionalized bureaucracy)Hcombination of multiple machine bureaucracies. E.g. motor company

$. 9rofessional bureaucracy)Hintellectual firms: schools college law firms 6. 2dhocracy)Hconsulting firms :rganizations have dfferent shapes or structure for many other reasons. They differ in their ultimate goals and the types of power used to achieve them some organizations have utilitarian goals .business/ others have normative goods .universities religious groups /. :rganization also serve different groups or have different constituencies some primarily benifiting their members others benifiting clients stoc! holders or the public. The nature of leadership differs greatly from one to another organizations. &ome organizations may be more democratic than others. 2nother way organization differ is by tas! they perform and the technology they use. &ome organization perform primarily routine tas! that could be reduced to formal use that re"uire little (udgement.

There are many ways in which electronic commerce transactions can be classified. :n the basis of the nature of participants in the electronic commerce transaction. The three ma(or electronic commerce catagories are as above: 1. Business to consumer: B#c involves relting products and services to individual shappers or consumers. E.g. amazon.com games and nobel.com #. B#B : B#B involves retailing products and services among business. E.g. milepro.com is a website for selling cutting tools grinding wheels and metal wor!ing fluits to more than 111111 small machine business. -. 5#5: 5#5 involves consumer selling directly to consumer. 4or e.g. ebay.com hamrobazar.com 2nother way of classifying electronic commerce transaction is in terms of participants physical connection to the web. %ntil recently almost all e)commerce transactions too! place over wired networ!s. =ow cell phones and other wireless handled digital applications are internet enabled so that they can be used to send email or access websites. The use of handled wireless devices for purchasing goods and services is called mobile commerce or m)comerce. $.@. customer centered retailing $.E. direct sale over the web: <anufacturers can sell their products and services directly to retail customers by passing intermediaries such as distributors or retail outlets. Eliminating intermediaries in the distribution channel can significant lower purchase transaction cost operators of virtual storefront. &uch as amazon.com do not have large e+penditures for rent sales staff and the other operations

associated with a traditional retail store. 2irlines can sell tic!ets directly to passengers through their own websites or through travel sites without paying commissions to travel agents. The removal of organizations or business process layers responsible for intermediary teps in a value chain is called disintermediation. The process of shifting the intermediary function in a value chin to a new source is called reintermediation. 4IG: $.F. interactive mar!eting and personalization: <ar!eters can use the interactive web pages to hold consumers attention or to capture detail information about their taste and interest for one to one mar!eting. &ome customer information may be obtained by as!ing visitors to register online and provide information about themselves but many companies are also collecting information by using the software tools that trac! the activities of website visitors. By using web personalization technology to modify the web pages presented to each other mar!eters can achieve the benefit of using individual sales people at dramatically lower cost. 9ersonalization can also help firms form lasting relationship with customers by providing individualized content information and services. $.0. 5ustomer self service: <any companies are using their websites and emails to answer customer "uestion to provide customer with helpful information. The web provides a medium through which customers can interact with the company at the customers convenience and find information that previously re"uire a human customer) support e+pert. 2utomated self service or other web based responses to customer "uestions cost a fraction of the price using a customer service representative on the telephone.now software products are even integrating the web customer call centers where customer service problems have been traditionally handled over the telephone. $.11 how intranets support electronic businessB Intranets can help organizations create a richer more responsiveness information environment. Internal corporate application based on the web page model can be made interactive using a variety of media te+t audio and video. 2 principle use of intranets has been to create online repositories of information that can be updated as often as re"uired. :rganizational benefits of intranet 1. 5onnectivity: accessible from most computing platforms #. 5an be tied to internal corporate systems and core transactions database. -. 5an create interactive applications with te+t audio and video $. Easy to use universal web interface 6. Gow start up cost @. 8icher more responsible information environment E. 8educed information distribution cost

2ssignment #: 1. Chat are the ma(or types of systems in a businessB Chat role do they playB #. Aow do information system support the ma(or business functions: sales and mar!eting manufacturing and production finance and accounting and human resourcesB -. Chy should managers pay attention to business processesB $. Chy do firm need to integrate their business processesB 6. Chat are the benefits and challenges of using enterprise systemB @. Chat are the benefits of using information system to support &5<B 2ssignment -: 1. Chat do managers need to !now about organizations in order to build and use information systems successfullyB #. Chat impact do information systems have an organizationB -. Aow do information systems support the activities of managers in organizationsB $. Aow can business use information system for competitive advantageB 6. Chy is it difficult to build successful information sytems including system that promote competitive advantageB 2ssignment $: 1. Aow has internet technology changed value proposition and business modelsB #. Chat is electronic commerceB Aow has electronic commerce changed consumer retailing and business to business transactionB -. Chat are the principal payment systems for electronic commerceB $. Aow can internet technology facilitate management and coordination of internal business process and supply chain managementB 6. Chat are the ma(or managerial and organizational challenges posed by electronic business and electronic commerceB

5hapter 6 6.redesigning the organization with information systems. 6.1. system as planned organization change: 2n information system is a socio)technical entity an arrangement of both technical and social elements the introduction of a new information system involves more than new hardware and software. It also include changes in (obs s!ills management and organization. In socio technical philosophy one cannot install new technology without considering the people who must wor! with it when we design a new information system we are re)designing organization. :ne important thing to !now about building a new information system is that this process is one !ind of planned organizational change. &ystem builders must understand how a system will affect the organization as a whole focusing particularly on organizational conflict and changes in the locus of decision ma!ing. Builders must also consider how the nature of wor!group will change under the new system. 2nalyst and designers are responsible for ensuring that !ey participants .members/ of the organization participate in the design process and are permitted to influence the systems ultimate shape. 6.# lin!ing information systems to business plan 3eciding which new system to build should be essential component of the organizational planning process. :rganizations need to develop an information system plan that supports their business plan. :nce specific pro(ects have been selected within the overall conte+t of a strategic plan for the business and the system area an information system plan can be developed. The plan serves as a road map indicating the direction of the systems development the rationale the current situation the management strategy the implementation plan the budget etc Aow to develop an information system planB 2 good information systems plan should address the following topics. 2/ 9urpose of the plan 1. :verview of plans content #. 5hanges in firm,s current situation -. 4irm,s strategic plan $. 5urrent business organization and future organization

6. *ey business processes @. <anagement strategy B/ strategic business plan 1. current situation #. current business organization -. changing environment $. ma(or goals of the business plan 5/ current systems. 1. ma(or system supporting functions and processes #. current infrastructure capabilities ) hardware software ) database -. difficult meeting business re"uirement $. anticipated future demands 3/ new developments 1. new system pro(ects ) pro(ect descriptions and business rationale #. new infrastructure capabilities re"uired ) hardware software ) database ) telecommunication and internet E/ management strategy 1. ac"uisition plans #. milestone and timing -. organizational realignment $. internal reorganization 6. management control @. ma(or training initiatives E. personal strategy 4/ implementation plan

1. anticipated difficulties in implementation #. progress plan G/ budget re"uirement 1. re"uirements #. potential savings -. financing $. ac"uisition cycle

Establishing organizational re"uirements 4or an effective information system plan the organization must have a clear understanding of both its long and short term information re"uirements. Two principle methodologies for establishing the essential re"uirements of the organization as a whole are enterprise analysis and strategic analysis. 1. Enterprise analysis .business system planning/: Enterprise analysis argues that the firm information re"uirement can only be understood by loo!ing at the entire organization in terms of organizational units functions processes and data elements. Enterprise analysis can help to identify the !ey entities and attributes of organizations data. The central method used in the enterprise analysis approach is to ta!e a large sample of managers and as! them how they use information where they get information what their environments are li!e what their ob(ectives are how they ma!e decisions and what their data needs are. The result of this large survey of managers are aggregated into sub units functions processes and data matrices. 3ata elements are organized into logical application groups) groups of data elements that support related sets of organization process. The wea!ness of enterprise analysis is that it produces an enormous amount of data i.e. e+pensive to collect and difficult to analyze. <ost of the interviews are conducted with senior or middle managers but there is little effort to collect information from clerical wor!ers and supervisory managers. #. &trategic analysis .critical success factor/: 4ig.using csf to develop systems/ The strategic analysis or critical success factor approach argues that ana organization,s information system re"uirement are determine by a small number of critical success factor.csf/ of managers. If these goals are obtained the firm or organization,s success is assured 5&4s are shaped by the industry the firm the manager and the business environment. 2n important premise of the strategic analysis approach is that there are a small number of ob(ectives that managers can easily identify and on which information systems can focus.

The principle methods used in csf analysis is personal interviews) - or $ with a number of top manager to identify their goals and the resulting csf. These personal csf are aggregated to develop a picture of the firm,s csf. Then systems are built to develop and deliver information of these csf. The strength of the csfs method is that it produces a smaller data set to analyze then enterprise analysis. :nly top managers are interviewed and the "uestions focus on the small no of csfs rather than a broad en"uiry into information is used or needed. The 5&4 method ta!es into account the changing environment with which organization and managers must deal. %nli!e enterprise analysis the csf method focuses organizational attention how information should be handled. This method is especially suitable for top management and for the development of 3&& and E&&. 6.$. Business process re)engineering and process management.

<any companies today are focusing on building new information system that will improve their business processes. &ome of these system pro(ects represents radical restructuring of their business processes whereas other in tail more incremental change. This restructuring of their business processes is called business process re) engineering. Cor!flow management: The process of stream lining business procedures so that documents can be moved easily and efficiently is called wor!flow management.

&teps in effective re)engineering: ) ) ) &enior management needs to develop a broad strategic vision that calls for redesigned business process 5ompanies should identify a few core business processes to be redesigned focusing on those with the greatest potential paybac! and strategic value <anagement must understand and measure the performance of e+isting processes as a base line. E.g. if the ob(ective of process redesign is to reduce time and cost in developing a new product or filling an order the organization needs to measure the time and cost consumed by the unchanged process. IT should be allowed to influence process design from the start. 4ollowing these steps it does not automatically guaranteed that re)engineering will always be successful. ) ) The organization IT infrastructure should have capabilities to support business processes changes that span boundaries between functions business units or firms. The ma(ority of re)engineering pro(ects do not achieve brea! through gains in business performance.

2 re)engineered business process or a new information system inevitable affects (obs s!ill re"uirements wor! flows and reporting relationships. 4ear of changes develops resistance confusion and even conscious effort to undermine the change effort. <anaging change is neither simple nor intuitive. The scope of re)engineering pro(ects had widened adding to their comple+ity. Today digital firm environment involves much closer coordination of a firm business process with those of customers suppliers and other business partners then in the past. :rganizations are re"uired to ma!e business change that span organizational boundaries and stand to derive substantial benefits from re)engineering inefficient inter) organizational process. 'oint design of inter organizational process by two different business or companies is called I) engineering and it will be more challenging to implement successfully than re) engineering processes for a single company. 6.6. 9rocess improvement

1. TJ< .total "uality management/ 2 concept that ma!es "uality control a responsibility to be shared by all people in an organization. #. &i+ sigma: 2 specific measure of "uality representing -.$ defects per millions opportunitiesD used to designate a set of methodologies and techni"ues for improving "uality and reducing cost. Aow the I& support "uality improvementsB 1. &implifying the products or the production process #. Benchmar!ing: setting strict standards for products services or activities and measuring organizational performance against those standards. -. 8educe consumer demands as a guide to improve products and services $. 8educe cycle time 6. Improve the "uality and precision of the design @. Increase the precision of production 6.@. :verview of system development system analysis design

4IG. the system development process/ Each of the organizations development activities entails interaction with the organization. &ystem development:

The activities that go into producing and information systems solution to an organizational problem or opportunity are called system development. &ystem development is a structured !ind of problem solving with distinct activities. These activities consist of system analysis system design programming testing conversion and production and maintenance. These activities usually ta!e place in a se"uential order. But some of the activities may need to be repeated or some way be ta!ing place simultaneously depending on approach to system building i.e. being employed. =ote that each activities includes interaction with organization. 1. &ystem analysis: The analysis of a problem that the organization will try to solve with an information system. It consists of defining the problem identifying its causes specifying the solution and identifying the information re"uirements that must be met by a system solution. Generally it is the role of a system analyst to perform these (obs. The system analyst creates a road map of the e+isting organization and systems identifying the primary owners and users of data in organization. In addition to these organizational aspects the analyst also briefly describes the e+isting hardware and software that serve the organization. 4easibility study: The system analysis would include a feasibility study to determine whether that solution was feasible or achievable from a financial technical and organizational stand point. The feasibility study would determine whether the porposed system was a good investment whether the technology needed for the system was available and could be handled by the firms information systems specialist and whether the organization could handle the changes introduced by the system. =ormally the system analysis process will indentify several alternative solutions that the organization can pursue.

Information re"uirement: 2 detailed statement of the information needs that a new system must satisfyD identifies who needs that information when that information is needed where and how the information is needed. #. &ystem design: It details how a system will meet the information re"uirements as determined by the system analysis. &2:)H343 .data flow diagram/ E8 diagram decision table decision tree structured. 5ompleting system development process -. 9rogramming: The process of translating the system specifications prepared durng the design stage into program code.

$. Testing: The e+haustive and through process that determines whether the system produced the desired result under !nown conditions. %nit testing: The process of testing each program separately in the system sometimes called program testing. %nit testing in multiple unit results integrating test. &ystem testing: Test the functioning of the information system as a whole in order to determine if descrete will function together as planned. 2cceptance testing: 9rovides the financial certification that the system is ready to be used in production setting. 2lpha test and beta test encomprise acceptance test. Test plan: 9repared by the development team in con(unction with the userD it includes all of the preparation for a series of test to be performed on the system. 6. 5onversioin: The process of changing from the old system to the new system. It is also called as implementation. Types : 1. 9arallel strategy: 2 safe and conservative conversion approach where both the old system and its potential replacement are run together for a time until everyone is assured that the new one functions correctly. #. 3irect cutover: 2 ris!y conversion approach where the new system completely replaces the old one on an appointed day. -. 9ilot study: 2 study to introduce a new system to a limited area of the organization until it is proven to be fully functional only then can the conversion to the new system across the entire organization ta!e place. $. 9hased study or phased approach: Introduces the new system in stages either by functions or by organizational units.

@.. production: The stage offer the new system is installed and the conversion is complete during this time the system is reviewed by users and technical specialist to determine how well it has met its original goals. E.. maintainence: 5hanges in hardware software documentation or procedure to production system to correct errors meet new re"uirements or improve processing efficiency.

5hapter @ Ethical and social issues in the digital firms @.1 understanding ethical and social issues related to systems @.# 2 model for thin!ing about ethical social and political issues @.#.1 five moral dimensions of the information age

4IG: the relationship between ethical social and political issues in an information society The introduction of new information technology has a ripple effect raising new ethical social and political issues that must be deal with on the individual social and political levels. These issues have five moral dimensionsD information right and obligation property right and obligations system "uality "uality of life and accountability and control.

@.1 understanding ethical and social issues related to systems. Ethics refers to the principles of right and wrong that individuals use to ma!e choices or to guide their behavior. Information technology and information systems raise new ethical "uestions for both individuals and societies because they create opportunities for intense social change and threaten e+isting distributions of power money rights and obligations. Gi!e other technologies such as steam engines electricity telephone and radio information technology can be used to achieve social progress but it can also be used to commit crimes and threaten social values. The development of information technology will produce benefits for many and costs for others. &o ethical and socially responsible course of action should be understood and identify for using information systems. @.# 2 model for thin!ing about ethical social and political issues Ethical social and political issues are closely lin!ed. Its relation can be shown as above diagram. The diagram shows these issues are the result of information technology and systems. The relation is the result of ripple effect. 4rom ethical issues social issues are generated which in terms generates political issues. @.#.1 five moral dimension of information system

The ma(or ethical social and political issues raised by information system include the following moral dimensions a. Information rights and obligations. Chat information rights do individuals and organizations possess with respect to information about them selfB Chat they can protectB Chat obligations do individuals and organizations have concerning this informationB In other words the rights that individual and organizations have with respect to information that pertains to themselves. b. 9roperty rights. Aow will traditional intellectual property rights be protected in a digital society in which tracing and accounting for ownership is difficult and ignoring such property rights is so easyB c. 2ccountability and control Cho can and will be held accountable and liable for the harm done to individual and collective information and property rightsB d. &ystem "uality Chat values and system "uality as well as standards of data should we demand to protect individual rights and the safety of society B e. Juality of life Chat values should be preserved in information and !nowledge based societyB Chat institutions should we protect from violationB Chat cultural values and practices are supported by the new information technologyB

@.#.#. *ey technology trends hat raise ethical issues Trend Impact

1. 5omputing power double every 1F months. #. 8apidly declining the data storage cost. -. 3ata analysis advance

<ore organization depends on computer system for critical operations. :rganization can easily maintain detailed database on individuals 5ompanies can analyze vast "uantities of data gathered an individual to develop detailed profile of individual behavior

$. =etwor! advances and the internet.

5opying personnel data firm remote location is much easier

=:82 .non obvious relationship awareness/: Technology that can find obsecure hidden connection between people or other entities by analyzing information from many different sources to coorelate relationships. @.-. ethics in information and society: a. responsibility: accepting the potentials costs duties and obligation for the decision one wor!s. b. accountability: the mechanism for accessing responsibility for decision mode and action ta!en c. liability: the e+istence of laws that permit individual to recover this damage done to them by other actors system or organizations.

Ethical analysis: &teps: 1. Identify and describe clearly the facts #. 3efine the conflicts or dilemma and identify the higher order values involved. -. Identify the stoc!holder. $. Identify the option that you can reasonably ta!e. 6. Identify the potential conse"uences of your option.