Lesson one : Introduction to Information Systems

LESSON ONE : Introduction to Information Systems
Overview
After completing this chapter, you will be able to Define an information system
• Distinguish between computer literacy and information system literacy
• Explain why information systems are so important today and how they are transforming organization and management
• Identify the major management challenges to building and using information systems in organization Define data, information, system and computer based information system

Summary of the subtopics
• Why information systems
• Approaches to information systems
• Systems
1.1 Why information systems
The environment of business has changed from the traditional environment where management processes are treated as a face-to-f ace, personal art and not a global coordination process while information itself was not treated as an important asset fora firm. But today, most of the organization recognizes the importance of information. For individuals, information systems are needed for entertainment and as an enlightment to their life. Meanwhile for businesses, information systems are mostly needed to help indecision making and problem solving. Besides that, it is used to gather, store and manipulate information. There are three main factors that contribute to the recognition of the importance of information to any organization.
• The first factor is the emergence and strengthening of the global economy. Globalization of the world’s industrial economies greatly enhances the value of information to the firm and offers new

opportunities to businesses. Information system provides the communication and analytical power that firms need for conducting trade and managing businesses on a global scale.
• The second factor is due to the transformation of industrial economies and societies into knowledge and information based service economies. In knowledge based economies, knowledge and information are key ingredients in creating wealth to an organization. Knowledge and information are becoming the foundation for many new services and products. Intensification of knowledge utilization in the production of traditional products has increased as well. New kinds of knowledge- and information-intense organizations have emerged that are devoted entirely to the production, processing, and distribution of information
• The third factor is due to the transforming of the business enterprise. Traditional firms was and still is a hierarchical, centralized, structured arrangement of specialist that typically relies on a fixed set of standard operating procedures to deliver a mass-produced product or services. But the business enterprises has change into flattened, decentralized, flexible arrangement of generalists who rely on nearly instant information to deliver mass-customized products and services uniquely suited to specific markets or customers Besides the above mentioned three main factors, there are also several trends that have made the use of information systems very important in business
• Computers power has grown tremendously, while their prices have dropped.
• Computer programs variety and ingenuity have increased.
• Quick and reliable communication lines and access to the Internet and World Wide Web have become widely available and affordable.
• The fast growth of the Internet has opened opportunities, as well as competition in global markets.
• An increasing ratio of the workforce is computer literate. In this environment, organizations will quickly lag behind if they do not take advantage of this progress and use the technologies and skills to meet their goals.