Information Systems for Business. An Experiential Approach

Table of Contents

Preface xv

SECTION I INTRODUCTION

1 The Value of Information 1

Focusing Story: How Information Cost Me (A Lot of) Money 2

Learning Activity 1.1 A Day in My Technology-Free Life Blog 3

Data Information Knowledge and Wisdom 3

Information Literacy 5

Uses of Information 5

Learning Activity 1.2 How I Use Information 6

Learning Activity 1.3 How Businesses Use Information 7

Business Box Promising Information Careers 7

Information and Your Career 8

2 Introduction to Information Systems 13

Focusing Story: Registering for Classes in 1981 14

Learning Activity 2.1 Identifying My Information Systems 15

Why All Business Professionals Need to Be IS Managers 15

Learning Activity 2.2 Components of a System 16

Overview of Systems 16

Learning Activity 2.3 Components of a Business Information System 18

Foundations of Information Systems 18

Stats Box Growth of Applications in Apple’s App Store 22

How Information Systems Help Us Deal with Information 22

Business Box How Southwest Airlines Flies High with Information Systems 24

Learning Activity 2.4 Information Systems and Change 25

How Information Systems Facilitate Organizational Change 25

Process Improvements 25

Automation 26

Control 26

Information Flow 26

Business Box Coopers Brewery: Using Information Systems for Quality and Sustainability 27

Common Information Systems 28

3 Evaluating Information 33

Focusing Story: Biased Information in a Trusted Outlet 34

Learning Activity 3.1 How Good is This Information? 35

Being a Smart Information Consumer 35

Stats Box 36

Business Box Resume Fraud 36

Learning Activity 3.2 My Online Life and Information Overload 37

Information Overload and the Need to Evaluate Information 38

Learning Activity 3.3 Dimensions of Information Quality 39

Information Quality 40

Business Box Information Quality as an Ethical Issue 42

Learning Activity 3.4 Evaluating Information Sources 43

Evaluating Information 43

Evaluating Usefulness 44

Evaluating Believability 45

4 Gaining Strategic Value from Information 51

Focusing Story: Healthcare on My Cell Phone 52

Strategic Information Systems 53

Strategic Planning Process 54

Step 1: Strategic Business Planning 54

Stats Box 55

Step 2: Information Systems Assessment 55

Step 3: Information Systems Vision 56

Step 4: Information Systems Architecture 56

Step 5: Strategic Initiatives Identification 57

Advantages of IS Strategic Planning Process 57

Frameworks for Strategic Information Systems 58

Information Systems SWOT Analysis 58

SWOT Analysis of a Person? 59

Porter’s Five Competitive Forces Model 60

Porter’s Value Chain Analysis 60

Virtual Value Chain 62

Evaluating Strategic Initiatives 64

Critical Success Factors 64

CSFS for Implementing Web Portals in Saudi Arabia 65

Learning Activity 4.1 What Does Yahoo! Need for Success? 66

Priority Matrix 66

Learning Activity 4.2 Competitive Advantage at Outrigger Hotels and Resorts 67

Hyper-competition: Sustainability of Competitive Advantage 67

Learning Activity 4.3 Google Vs. Yahoo! 69

SECTION II MANAGING INFORMATION

5 Storing and Organizing Information 75

Focusing Story: The Database Behind Facebook 76

Learning Activity 5.1 Data for an Amazon Order 77

Stats Box 77

Overview of Relational Databases 77

Databases and Database Management Systems 77

Learning Activity 5.2 Connecting Data Elements 78

Databases vs. Spreadsheets (When to Use a DBMS) 78

Relational Databases 79

Database Diagrams 83

Learning Activity 5.3 Finding Business Databases Online 84

The Compact Disc Database (CDDB) 84

Online Databases 85

6 Analyzing Information for Business Decision-Making 91

Focusing Story: How a Spreadsheet Saved Me (A Lot of) Money 92

Learning Activity 6.1 Information and Decision-Making 93

Importance of Good Decision-Making Skills 93

Learning Activity 6.2 What Kind of Information Do I Need? 94

Using Information for Decision-Making 94

Business Box Why Do Managers Make Bad Decisions? 95

Types of Decisions 95

A Decision-Making Process 97

Identify and Clearly Define the Problem 97

Determine Requirements and Goals 98

Identify Alternatives 99

Define the Criteria 99

Learning Activity 6.3 Requirements Goals and Criteria 99

Select a Decision-Making Technique/tool 100

Evaluate the Alternatives Using the Criteria 101

Check That the Solution Solves the Problem 102

Information Retrieval and Analysis Tools 102

Learning Activity 6.4 "What If " I Get a 75% on the Final? 103

Stats Box The Cost of Spreadsheet Errors 106

Learning Activity 6.5 What- If? Analysis in Business 107

7 Transmitting Information 113

Focusing Story: I Want My Own WiFi!: The Emergence of the MiFi 114

Introduction and Definitions 115

Learning Activity 7.1 Online Document Sharing 116

Network Components and Characteristics 116

Types of Networks 117

Wired vs. Wireless Networks 117

Broadband Networks 118

Stats Box 1 Broadband Penetration in the G7 Countries 119

Network Coverage 120

The Internet 121

Internet Applications 122

Stats Box 123

Business Box 1 Internet Application of the Day: Get a Degree Online! 124

Internet vs. Intranet 125

Virtual Private Network (VPN) 125

Learning Activity 7.2 A Future Internet? Internet2 and Business 125

Networking Architectures 126

Architectural Principles 126

Client/Server Architecture 126

Peer-to-Peer Architecture 128

Wireless Architecture 128

Service Oriented Architecture (SOA) 128

Software as a Service (SaaS) 129

Cloud Computing 130

Virtualization 130

Learning Activity 7.3 Architecture and Principles 130

Communicating Information in Modern Organizations 131

Web 2.0 132

Unified Communications (UC) 132

The Power of Wikinomics 134

Stats Box 135

Learning Activity 7.4 Web 2.0 for Business 136

Web 3.0 136

8 Securing Information 143

Focusing Story: My Mac is More Secured than Your Windows-based PC! 144

Introduction and Definitions 146

Information Security Concepts 146

Security Levels 146

Learning Activity 8.1 How Protected is Your Computer? 147

Information Security Threats 148

Denial of Service 148

Unauthorized Access 150

Stats Box 151

Business Box 1 Even Big Technology Companies Can be Hacked 153

Learning Activity 8.2 Detecting Phishing 154

Theft and Fraud 154

Summary of Security Threats 155

Security Technologies and Solutions 157

Security Goals 157

Preventive Corrective and Detective Controls 157

Physical Security vs. Logical Security 158

User Profiles 158

Learning Activity 8.3 How Strong is Your Password? 159

Biometrics 160

Firewalls 162

Rendering Data Unreadable: Encryption 166

Learning Activity 8.4 Breaking the Encryption 166

Types of Cryptography 166

Virus Protection 169

Wireless Security 169

Stats Box 170

Security Policies 170

Business Box 2 How to Respond to a Security Crisis 170

Stats Box 3 Security Policies Compliance 171

Learning Activity 8.5 Where’s the Security? 172

Risk Management 172

9 Protecting the Confidentiality and Privacy of Information 181

Focusing Story: The Reselling of Customer Data: The Choicepoint Story 182

Learning Activity 9.1 Finding Mindy’ 183

Information Privacy Threats 185

Data Collection 186

Secondary Use of Information 187

Learning Activity 9.2 Privacy Pizza 187

Stats Box 1 Concern for Information Privacy 188

Consequences of Privacy Violations 188

Individual Consequences: Identify Theft 188

Stats Box 2 Fraud Type from Identity Theft 189

Organizational Consequences: Company Reputation 190

Stats Box 3 Reputation Risks of Social Networking 191

Technologies and Solutions for Information Privacy 191

Stats Box 4 Surveillance Societies Around the World 192

Cookies and Cookie Managers 192

Learning Activity 9.3 Privacy Policy Creation 194

Privacy Statement or Policy 194

Business Box 1 Privacy and Facebook 196

Privacy Seals 197

Activity 9.4 Why Your Advisor can’t Talk to Your Parents 197

Government Information Privacy Regulations 198

Business Box 2 Hippa and Identity Theft 199

Privacy and Ethics 199

Learning Activity 9.5 Papa Privacy Policies and FERPA 200

Relationship between Security and Privacy 201

SECTION III USING INFORMATION

10 Developing Information Systems 207

Focusing Story: The $6 Billion Software Bug 208

Time Cost and Quality 209

Learning Activity 10.1 Determining Requirements 210

Software Development Methodologies 210

Traditional Systems Development Life Cycle 211

Planning Phase 212

Requirements Phase 212

Design Phase 213

Development Phase 214

Implementation Phase 214

Maintenance Phase 215

Learning Activity 10.2 Advantages and Disadvantages of the SDLC 215

Stats Box Standish Chaos Report 216

Alternative Methodologies 216

Prototyping 216

Rapid Application Development (RAD) 217

Spiral Model 218

Learning Activity 10.3 Comparing the Methods 220

Build or Buy Decision 220

Learning Activity 10.4 How Open Source Software Impacts Build vs. Buy 223

Using Open Source in Business 223

Business Box Bad Economy Leads to More Open Source Software 225

Learning Activity 10.5 What to Outsource 225

Outsourcing Information Systems 226

Outsourcing Models 226

Benefits and Risks of Outsourcing 227

Making the Outsourcing Decision 227

Business Box Reversing the Outsourcing Decision 228

Geographic Considerations 229

11 Information-Based Business Process 235

Focusing Story: Improving Processes is For Everyone! 236

Learning Activity 11.1 How Many Steps in this Process? 237

What Is a Process? 237

Process Modeling 239

Learning Activity 11.2 Model This! 240

Business Process Modeling Tools 240

Technology and Processes 242

Process Improvement 243

Levels of Change 245

Stats Box 1 Importance of Process Redesign 245

Learning Activity 11.3 Redesign This! 246

Business Box 1 Choicecare Physicians: Changing Access to Patient Records 247

12 Enterprise Information Systems 251

Focusing Story: Supply Chain Innovations at Wal-Mart 252

Learning Activity 12.1 Finding The Components of an Enterprise System 254

Enterprise Systems 254

Personal vs. Enterprise Systems 254

Integration and Enterprise Systems 256

Characteristics of Enterprise Systems 256

Enterprise Resource Planning (ERP) 258

Benefits and Disadvantages of ERP Systems 259

Business Box 1 The Power of ERP Data: How Slumberland Furniture Cleaned up its Supplier List 259

Business Box 2 ERP is not Always a Horror Story: Cisco Implementation on Time and Budget 261

Stats Box 1 Top Seven Selected ERP Vendors 262

Learning Activity 12.2 The Online Beer Game 262

Supply Chain Management Systems 263

Stats Box 2 Supply Chain’s Impact on Company Valuation 265

Learning Activity 12.3 Customer Relationship Management 265

Customer Relationship Management Systems 266

Customer Service Life Cycle 266

Components of CRM 268

Learning Activity 12.4 Self-servicing 268

Stats Box 3 CRM Vendors 269

CRM Implementation Options 269

Business Box 3 Not Just Technology: Training People for CRM At British Telecom 270

Benefits and Limitations of CRM 271

Customer Managed Interactions (CMI) 272

13 Information for Electronic Business 279

Focusing Story: The iPod and The Music Industry 280

Learning Activity 13.1 Why is E-business Important? 282

Introduction to E-business 282

Types of E-businesses 282

Stats Box 1 Retail E-commerce in The United States 284

E-business Models 285

What is a Business Model? 285

B2C E-business Models 286

Business Box 1 Changing The Business Model: Furniture.com 288

B2C E-business Enablers 288

Technological Enablers 288

Critical Mass 289

B2C E-business Impacts 290

E-channel Compression (Disintermediation) 290

E-channel Expansion 291

Learning Activity 13.2 Why Would I Trust them or Buy from Them? 291

Design for B2C E-Business 292

Business-to-Business (B2B) 293

Stats Box 2 B2B vs. B2C E-business 293

B2B E-business Models 294

Learning Activity 13.3 Where is My Web Page? 296

Search Engine Optimization 296

Trends in E-business 298

Mobile Business 299

Stats Box 3 Mobile Behaviors 300

Global e-Business 301

Stats Box 4 E-business in Ontario 301

Learning Activity 13.4 USA.Gov 302

E-government 302

14 Information and Knowledge for Business Decision Making 309

Focusing Story: Managing Knowledge by Texting 310

Learning Activity 14.1 How You Manage Knowledge 311

Knowledge Management 312

Why Managing Knowledge is Important 312

Types of Knowledge 313

Types of Knowledge Resources 314

Main Processes for Knowledge Management 314

Creating Knowledge 315

Capturing and Codifying Knowledge 316

Business Box The Issue of Trust in Knowledge Management 318

Storing and Retrieving Knowledge 318

Transferring and Applying Knowledge 319

Learning Activity 14.2 Wikis for Managing Knowledge 319

Knowledge Management Technologies 320

Repositories 320

Communication-based Tools 320

Stats Box Linkedin Groups as Communities of Practice 321

Executive Information Systems and Dashboards 321

Expert Systems 321

Learning Activity 14.3 Using a Decision Support System 323

Decision Support Systems and Group Decision Support Systems 323

Business Intelligence 326

Data Warehousing 327

Data Mining 328

Learning Activity 14.4 Making Ethical Decisions 332

Ethical Decision-Making 332

Index 339

Online In-Depth Guides (posted at the Instructor and Student Companion Sites: company website)

1. Hardware

2. Software

3. Networking Basics

4. Advanced database concepts

5. Spreadsheets

6. Funding information systems

7. Managing projects

8. Advanced security privacy and risk management

Authors

France Belanger, PhD Virginia Tech.

Craig Van Slyke, PhD St. Louis University.