Group4-report.docx

Lesson 6: System Background definitions and classification

LAIREN Background A system is a set of interdependent components – (sub-entities) that creates a whole entity. The components are dynamically linked (i.e. each one affects and is affected by other components). The concept of a system is a broad one encompasses every facet of our lives – the solar system, educational systems, transportation systems, information systems, organizations, society, the family and the body systems. The linkages between entities make it a system. The way it is looked at, that is, the purpose/s one describe to it, sets a boundary around the linked components that differentiates the system from its environment. Every organization is composed of subsystems, one of which is the information system. The subsystem interacts and contributes to the common purposes of the organizations. The effectiveness of these subsystems considered separately. This is describing by Aristotle’s statement – “the whole is greater than the sum of its parts”. One of the attributes of modern organization is their increasing complexity and specialization of their subsystems. Each organization unit has its own objectives and can thus lose sight of how their activities and goals interrelate with those of the organizations as a whole. In a university for example, the Vice President for Academic Affairs wants to have a large inventory or courses in order to satisfy large inventory of courses in order to satisfy student’s preferences. The Vice President for Administration, on the other hand, wants to schedule courses with large enrollments in order to minimize investments in classrooms and academic personnel. It is a conflict of different system. In this situation, the systems approach is to consider the manner in which administration of university should view the interrelationships of various subsystems of the university system. Common Types of Systems There is much different type of systems that we come into contact with during our day-to-day life. It’s either a system or a component of a system (sub-system) or both. The following are the two general classifications of systems:  Natural System

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these system are not made by people; they exist in nature, and is

further divided into two basic sub categories: 1. Physical systems -

Prof. Yourdon gave these example under physical system 

Skellar System – galaxies, solar system and so on



Geological System – rivers, mountain ranges and so on



Molecular System – complex organization of atoms

2. Living System - encompasses all of the natural animals and plants around us as well as our human race. According to James Miller, “this category also includes hierarchies of individual living organisms, for example, herbs, flocks, and tribes, social groups, companies and motion.  Man-made System - these are system that are constructed, organized and maintained by humans. These include things such as social systems, transportation systems, postal system. Man-made system (and Automated System) interacts with living systems; for example computerized pacemakers interact with the human heart. There are cases in which automated systems are being designed to replace living systems; and in some cases researcher’s are considering living system as components of automated systems. Living system and man made system are often part and parcel of a larger meta-system. The more you understand about them, the better MIS people you become. Under this man made systems, only the automated systems will be given a focus, since when someone speaks of information system nowadays it means the use of the technologies available in the market. However, many companies have not gone far because they are still using manual systems. It is believed that they are just waiting for tomorrow’s creative users and MIS professionals to identify their potential need for computerization. Moreover, these manual systems are symbol of opportunities to improve the company’s productivity through the application of MIS technologies.

ARYAN Categories of Automated Systems Decision Support System - computer based designed to provide information to support specific decision-making situations. AI (expert systems) - a set of computer programs that emulates the decision making capability of expert based on facts provided to the system. Online System - transactions are stored in a temporary storage and evaluated later Example: Ms. Long Collantes proposed the computerization of the student Information System of the Lagro School of Business in Quezon City. The school administration agreed to her recommendation for Local Area Network (LAN). Terminals are placed in the different departments. The server (main computer) is located at the school registrar. When a student enrolls in a certain department an operator enters a data contained on the enrolment sheet directly to the terminal and then stored to the department’s master file. And then, the enrolment report are produced through the printer, which is an output device.  Real time system -

the result of transaction should be communicated and recorded at the

time the transaction was made. Example: United Colors airline has created offices around Metro Manila and even in the nearby provinces. Passenger or agencies buy their tickets from these officers. Reservations can also be made at these off-site offices. Transactions are entered into a computer and will be transmitted right away to the main office which houses the main computer.

Lesson 7: Information Systems: Challenges and Opportunities Emergence 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 business. Today, information systems provide the communication and analytic power that firms need for conducting trade and managing business on the global scale. Controlling the far-plug global corporation – communicating with distributors and suppliers, operating 24 hours a day in different national environments, servicing local and international reporting needs – is a major business challenge that requires powerful information system responses. Globalization and information technology also brings new threat to domestic business firms: because of global communication and management systems, customers now can shop in a worldwide market place, obtaining price and quality information reliability, 24 hours a day. This phenomenon heightens competition and forces firm to play in open, unprotected worldwide markets, firms need powerful information and communication systems. The New Role of Information Systems in Organization Information system cannot be ignored by managers because they play such a critical role in contemporary organization, Digital Technology is transforming business organizations. The entire cash flow of most Fortune 500 companies is linked to information systems. Today’s systems directly affect how managers decide, how senior managers plans, and in many cases what products and services are produced (and how).

JERICK The Widening Scope of Information Systems There are growing interdependence between business, strategy, rules and procedures on

one

hand,

and

information

systems

software,

hardware,

databases,

and

telecommunication on the other. A change in any of these components often requires changes in other components. This relationship becomes critical when management plans for the future. What a business would like to do in five years is often dependent on what its system will be able to do? Increasing market share, becoming the high quality or low cost producer, developing new products, and increasing employee productivity depend more and more on the kinds of quality information systems in the organization. A second change in the relationship of information systems and organizations result from the growing complexity and scope of systems projects and applications. Building systems today involves a much larger part of the organization than it did in the past. Whereas early systems bring about managerial changes (who has what information about whom, when, and how, often) and institutional “core” changes (what product and services are produced under what condition). In the 1950’s, employees in the treasurer’s office, a few part-time programmers, a single program, a single machine, and a few clerks might have used a computerized payroll system. The change from a manual to a computerized system was largely technical – the computer system simply automated a clerical procedure such as check processing. In contrast, today’s integrated human resource system (which include payroll processing) may involve all corporate division, the human resources department, dozen of full time programmers, a flock of external consultants, multiple machines (or remote computers linked by communication networks, and perhaps hundreds of end users in the organization who use payroll data to make calculations about benefits and pensions and to answer a host of other questions. The data, instead of being located in and controlled by the treasurer’s office, a re now available to hundreds of employees via desktop computers each of which is as powerful as the large computers of the mid 1980’s. The contemporary system embodies both managerial and institutional changes.

The Network Revolution and Internet One reason why system plays a larger role in organizations; and why they affect more people, is the soaring power and declining cost of the computer technology that is at the more of information systems. Computing power has been doubling every 18 months, so the performance of the microprocessors has improved 25,000 times since their invention 26 years ago. The world’s largest and the most

widely used network is the internet. The internet

is an international network of networks that are both commercially and publicly owned. The internet connects hundreds of thousands of different networks from around the world. Millions of people working in science, education, government, and business transactions with other organizations use the internet around the globe. The internet is extremely elastic. If networks are added or removal of failure occurs in parts of the system, the rest of the internet continues to operate. Through special communication and technology standards, any computer can communicate with virtually private individuals linked using ordinary telephone lines. Companies and private individuals can use the internet to exchange business transactions, text messages, graphic images, and even video and sound, whether they are located next door or on the other side of the globe. The internet is creating a new “universal” technology platform upon which to build all sorts of new product, services, strategies, and organizations. Its potential for reshaping the way information systems are used in business and daily life is vast and rich, and it is just beginning to be trapped. By eliminating many technical, geographic and cost barriers obstructing the global flow of information, the internet is accelerating the information revolution, inspiring new uses of information systems and new business models.

CESS What can you do with the Internet? Function Communicate and collaborate

Description Send electronic mail messages, transmit documents and data, participate in electronic conferences

Access information

Search

for

documents

databases,

and

library

card

catalogues, read electronic brochures, manuals, books and advertisements. Participate in discussions Join interactive discussions groups; conduct primitive Obtain information

voice transmission Transfer computer files and text, computer program,

Find entertainment

graphics, animation and videos. Play interactive video games; view short video clips; read

Exchange business transaction

illustrated and even animate magazines and books. Advertise, sell, and purchase goods and services.

Of special interest to organization and managers in the internet capability know as the World Wide Web, because it offers so many few possibilities for doing business. The World Wide Web is a system with universally accepted standards for storing, retrieving, formatting, and displaying information in a networked environment. Information is stored and displayed as electronic pages that can contain text, graphics, animations, sounds, and video. These Web pages can be linked electronically to other web pages, regardless of where they are collected, and viewed by any type of computer. By clicking on highlighted words or buttons or web page, one can link to relate pages to find additional information, software programs, or still more links to other points on the web. The web can serve as the foundation for new kinds of information. The web pages created by an organization or individual are called Web site. Business are creating web site with stylish typography, colorful graphics, push-button interactivity, and often sound and video to widely disseminate product information, to broadcast advertising and messages to customers, to collect electronic orders and customer data, and increasingly to coordinate far plug sales forces and organizations on a global scale.

New Options for Organizational Design Information systems can become powerful instruments for making organization more competitive and efficient. Information Technology can be used to redesign and reshape organizations, transforming their structure, scope of operations, reporting and control mechanisms, work practices, work flows, products and services. We now describe some major organizational design options that information technology has made available. 

Flattening Organizations Today, the large, bureaucratic organizations that developed before the expensive

growth of information technology are often inefficient slow to change and uncompetitive. Some of these organizations have downsized, reducing the number of employees and the number of levels in their organizational hierarchies. Flatter organizations have fewer levels of management, with lower-level employees being given greater decision making authority. These employees are empowered to make more decision than in the past, they no longer work standard 9 to 5 hours, and they no longer necessarily work in an office. Moreover, such employees may be scattered geographically, sometimes working half a world away from managers. Modern information systems have made such changes possible. They can make more information available to line workers so they can make decisions that previous had been made by managers. Networks of computers have made it possible for employees to work together as a team, another feature of flatter organizations. With emergence of global networks such as the internet, team members can collaborate closely even from distant locations.  Separating Work from Location It is now possible to organize globally while locally; information technology such as email, the internet, and video conferencing to the desktop permit tight coordination of geographically dispersed workers across time zones and cultures. Entire part or organizations can disappear. Inventory (and warehouse to store it) can be eliminated as suppliers tie into firm’s computer systems and deliver just in needed and just in time. Modern communications technology has eliminated distance as a factor for many types of work in many situations. Sales person can spend more time in the fields – with customers – and yet have more up-to-date information with them while carrying much less paper. Many

employees can work remotely from their homes or cars, and companies can reserve at a much smaller central office for meeting clients or other employees. Companies are not limited to physical locations or their own organizational boundaries for providing products and services. Networked information systems are allowing companies to coordinate their geographical capabilities and even coordinate with other organizations as virtual corporation (or virtual organizations) sometimes called networked organizations). Virtual organizations use networks to link people, assets and ideas, allying with suppliers and customers (and sometimes even competitors) to create and distribute new products and services without being eliminated by traditional organizational boundaries or physical location. One company can take advantage of the capabilities of another company, without actually physically linking to that company.  Increasing Flexibility of Organization Modern communications technology has enabled many organizations in more flexible ways, increasing the ability of those to respond to changes in the marketplace and to take advantage of new opportunities. Information systems can give both large and small organizations additional flexibility to overcome some of the limitations posed by their size.

CARL How Information Technology Increases Organizational Flexibility? 1. Small Companies Desktop machines, inexpensive computer-aided design (CAD) software, and computer-controlled machine tools provide the precision, speed and quality of giant manufacturers. Information immediately accessed by the telephone and communication links eliminates the need for research staff and business libraries. Managers can more easily obtain the information they need to manage larger numbers of employees in widely scattered locations. 2. Large Companies Custom manufacturing systems allow large factories to offer customized products in small quantities. Massive database of customers purchasing records can be analyzed so that large companies can know their customers need and preferences as easily as local merchants. Information can be easily distributed down the ranks of the organizations to empower lower-level employees and work group to solve problems.  Redefining Organizational Boundaries and Electronic Commerce Networked information system can enable transactions such as payments and purchase orders to be exchanged electronically among different companies, thereby reducing the cost of obtaining products and services form outside the firm. Organizations can also share business data, catalogues, or mail message through such systems. These networked information system can create new efficiency and new relationship between an organization, its customers and suppliers thus redefining their organizational boundaries and the way they conduct business. System linking in a company to its customers, distributors, or suppliers are termed inter-organizational systems because they automate the flow of information across organizational boundaries. Such systems follow information or processing capabilities of the organization to improve the performance of another to improve relationship among organization.

Inter-organizational Systems that provide services to multiple organizations by linking many buyers and sellers create an Electronic Market. Through computer and telecommunications, these systems function like electronic middlemen with lowered cost for typical market place transactions such as selecting supplies, establishing prices, ordering goods, paying bills. Buyers and sellers can compete purchase and sale transactions digitally regardless of their locations. The internet is creating a global electronic market place where vast array of goods and services are being advertised bought, and exchange world wide. Companies are furiously creating eye-catching electronic brochures, advertisements, product manuals and order from the World Wide Web. All kinds of products and services are available on the web, including fresh flowers, books, real estate, musical recording, electronic streaks and automobiles.  Reorganizing Work Flows Since the first uses of information technology in business, information systems have been progressively replacing manuals work procedures with automated work procedures, work flows and processes. Electronic work flows have reduced the cost of operations in many companies by displacing paper and manual routines that the companies that accompany it. Improve work flow management customer services has enable many corporations not only to cost cut significantly but also to improve customer services at the same time. Redesigned work flows can have a profound impact on organizational efficiency and can lead to new organizational structure, products and services.  The Changing Management Process Information Technology is recasting the process of management. Providing powerful new capabilities to help managers strategize and plan, organize, lead and control. For instance, it is now possible for managers to obtain information on organizational performance down to the level of specific transactions from just about anywhere in the organization anytime. This new intensity of information makes possible far more precise planning, forecasting and monitoring. Information technology has also opened new possibilities for leading. By distributing information through electronic networks, the new managers can effectively communicate frequently with thousands of employees and even manage far-plug forces and teams – task which would be impossible in face-to-face traditional organizations.  New People Requirement

Managers must deal with people issues because the changes brought about by information technology definitely require a new kind of employee. Employees need to be highly trained in the past as work shifts from production goods to production services and more tasks become automated. High on this skill set the ability to work in an electronic environment; the ability to digest new information and knowledge, and act upon that information; and the ability and willingness to learn new software and business procedures. The new global worker, whether in factories or offices, is a multitalented college graduate who is exceptionally productive because of an ever-changing set of skills and competencies.