[PDF]Business Information Systems

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usiness Information Systems



lizabeth Hardcastle




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Elizabeth Hardcastle

Business Information Systems



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2



Business Information Systems

© 201 1 Elizabeth Hardcastle & Ventus Publishing ApS

ISBN 978-87-7681-463-2



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Business Information Systems



Contents



Contents



1 Defining Information Systems

1 . 1 Defining Data and Information

1.2 Defining Systems

1.3 Defining Information Systems

1.4 Business Information Systems

1.5 Types of business information system



2 Hardware

2.1 Input devices

2.2 Central Processing Unit (CPU)

2.3 Internal and External Memory

2.4 Output devices

2.5 Major categories of computers



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3 Software

3.1 Systems software

3. 1 .2 Software Development programs

3.2 Application software



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Quality In Everything We Do



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Business Information Systems



Contents



4 Database Systems

4. 1 Organising data in a database

4.2 Database Software

4.3 Retrieving Data from a Database

4.4 Business Intelligence

5 Networks

5.1 Network components

6 The Internet and World-Wide Web

6.1 Web -Enabled Business

6.2 Intranets and extranets

6.3 The World Wide Web

6.4 Web browsers and servers

6.5 E-business

6.6 E-commerce



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7 Acquiring Information Systems

7.1 Bespoke development

7.2 Off-the-shelf software

7.3 End-user-developed software

7.4 Factors affecting software acquisition



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Business Information Systems



Contents



8 Developing Information Systems

8. 1 The systems development life cycle



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9 Systems Development Methodologies

9.1 SSADM

9.2 Rapid applications development (RAD)

9.3 The spiral model

9.4 The Capability Maturity Model

10 Information Systems Security

10.1 Security Threats to Information Systems

10.2 Reducing the Threat to Information Systems

10.3 Types of controls

10.4 Techniques for controlling information systems

10.5 Security Threats to Internet services

Bibliography



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Business Information Systems Defining Information Systems

1 Defining Information Systems

This chapter provides a discussion of the nature of information and systems.

1 .1 Defining Data and Information

It is important to distinguish between data and information. Data is a raw fact and can take the form of a number or
statement such as a date or a measurement. It is necessary for businesses to put in place procedures to ensure data are
recorded. For example, to ensure a call centre operator includes the postcode of every customer this can be written into
their script and a validation check performed to check these data have been entered into the system.

A common definition of information is that it is data that have been processed so that they are meaningful (Oz and Jones,
2008). This requires a process that is used to produce information which involves collecting data and then subjecting
them to a transformation process in order to create information. Some examples of information include a sales forecast
or a financial statement.

As stated information is generated through the transformation of data. This can be achieved using a number of different
transformation or data processes. Some examples of data processes include aggregating which summarises data by such
means as taking an average value of a group of numbers. Classification places data into categories such as on-time and
late deliveries. Sorting organises data so that items are placed in a particular order, for example listing orders by delivery
date. Calculations can be made on data such as calculating an employee's pay by multiplying the number of hours worked
by the hourly rate of pay. Finally data can be chosen based on a set of selection criteria, such as the geographical location
of customers.

Although information is an useful resource for individuals and organisations not all information can be considered useful.
The differences between 'good' and 'bad' information can be identified by considering whether or not it has some or all
of the attributes of information quality. Attributes can be related to the timing, content and form of the information.

Timeliness refers to that the information should be available when needed. If information is provided too early, it may
no longer be current when used. If the information is supplied too late, it will be of no use. Also the information should
cover the correct time period. A sales forecast, for example, might include information concerning past performance,
current performance and predicted performance so that the recipient has a view of past, present and future circumstances.

The content of the information refers to factors such as the accuracy of the information and relevance of the information
to a particular situation and user.

The form of the information refers to aspects such as the clarity of the information which should be appropriate to the
intended recipient. The recipient should be able to locate specific items quickly and should be able to understand the
information easily. The information should also contain the correct level of detail in order to meet the recipient's information
needs. For example, in some cases highly detailed information will be required whilst in others only a summary will be
necessary.

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Business Information Systems Defining Information Systems

1.2 Defining Systems

A system can be denned as a collection of components that work together towards a common goal. The objective of a
system is to receive inputs and transform these into outputs. In the previous section 'defining data and information' the
use of a transformation process was used to explain how data is converted into information. Not every system has a
single goal and often a system contains several subsystems with subgoals, all contributing to meeting the overall system
goal. For example the finance, operations and marketing areas of an organisation should all have goals which together
help to achieve overall corporate objectives. It can be seen that in systems data are used as the input for a process that
creates information as an output. In order to monitor the performance of the system, some kind of feedback mechanism
is required. In addition, control must be exerted to correct any problems that occur and ensure that the system is fulfilling
its purpose. There are thus five components of a generic system in terms of input, process, output, feedback and control.

1.3 Defining Information Systems

The role of the Information systems to provide information to management which will enable them to make decisions
which ensure that the organisation is controlled. The organisation will be in control if it is meeting the needs of the
environment. In relation to control systems can be classified into open-loop and closed-loop (Bocij et al., 2008).

An open-loop control system is one that has no way of ensuring objectives are met for a process. This means they are
unsuitable in an organisational context because of the complexity of the environment in which organisations exist. Thus
open-loop systems would only be successful in attaining a system's objectives in cases where we know with certainly the
events that would take place during the system's process.

Closed loop systems can have two types of control mechanism referred to as feedback control and feedforward control.
Feedback control systems generally provide a way of ensuring a system is under control. Negative feedback is when actions
are taken to reverse any differences between desired and actual outputs. The weakness of this approach is the potential
for delay between the discrepancy and the action taken to reduce it. Feedforward control systems attempt to overcome
the time-delay associated with feedback systems by incorporating a prediction element in the control feedback loop.
Feedforward systems are not as common as feedback systems in business settings. Examples include project management
plans which are made to meet time, quality and cost objectives over time.

1.4 Business Information Systems

With the previous definitions of information and systems we can now define a business information system as a group
of interrelated components that work collectively to carry out input, processing, output, storage and control actions in
order to convert data into information products that can be used to support forecasting, planning, control, coordination,
decision making and operational activities in an organisation (Laudon and Laudon, 2007). In terms of the components
that undertake this activity, they can be classified into five basic resources of people, hardware, software, communications
and data. People resources include the users and developers of an information system and those who help maintain and
operate the system such as IS managers and technical support staff. Hardware resources include computers and other items
such as printers. Software resources refer to computer programs known as software and associated instruction manuals.
Communications resources include networks and the hardware and software needed to support them. Data resources
cover the data that an organisation has access to such as computer databases and paper files.

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Business Information Systems Defining Information Systems

In most organisations Business Information Systems (BIS) make extensive use of information technology, such as personal
computers. The reasons why computerised BIS have become widespread are evident in their advantages such as speed,
accuracy and dependability. They also have a high degree of flexibility due to their ability to be programmed to carry out
a wide variety of tasks. There are, however, some disadvantages to BIS such as their lack of creativity that humans possess
and the difficulty of incorporating other factors into their decision making such as innovation and intuition.

1 .5 Types of business information system

Information systems may be divided into two categories of systems that support an organisations day-to-day business
activities and systems that support managerial decision making. Operations Information Systems (OIS) are generally
concerned with process control, transaction processing and communications. Management Information Systems (MIS)
are concerned with providing support to managerial decision making. Recently this division of BIS into operational and
management systems, although useful for managers reviewing the types of BIS in use, does not now accurately reflect the
reality of systems used within an organisation, particularly with the increased use of inter-organisational e-commerce and
electronic data interchange (EDI). For example e-business systems and enterprise resource planning systems cut across
both operational and management systems to provide businesses with more integrated information systems.



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Business Information Systems Hardware

2 Hardware

Hardware describes the physical components of a computer system which can be categorised as input devices, a central
processing unit, internal and external memory and output devices (Beynon-Davis, 2009). Input devices are used to capture
or enter data into the computer. The central processing unit (CPU) performs processing by carrying out instructions
given in the form of computer programs. Internal memory is used as a temporary means of storage data and instructions
while external memory provides a means of storing data and programs outside of the computer. Output devices translate
the results of processing into a human-readable form. These hardware components will now be described in more detail.

2.1 Input devices

Input devices are used to enter data or instructions from outside the computer into the computer. A mouse and keyboard
are examples of input devices. The choice of an input device will often depend upon the quantity of data to be entered.
Entering data on a small scale is normally carried out by human operators, using a number of familiar input devices, such
as the mouse or keyboard. A computer-based information system will seldom make use of only a single input device.
Even a typical personal computer will often feature several different methods for data entry, such as keyboard, mouse,
joystick and sound card.

2.2 Central Processing Unit (CPU)

The central processing unit (CPU) or processor accepts instructions and data and executes them storing the results in
memory. The increased speed of computers is primarily a result of increasing CPU speeds. The speed of a processor will
depend upon a number of different factors, such as the clock speed and bus width. The clock speed determines how many
instructions per second the processor can execute. The bus width describes how many pieces of data can be transmitted
at one time. In both cases the higher the value, the more powerful the processor. Clock speed and bandwidth values can
be helpful when attempting to compare processors in order to select the most appropriate.

2.3 Internal and External Memory

Computer memory is categorised as internal memory (also called main memory or primary memory) which is data held
on the computer and external memory (also called external storage) which is data stored on a separate device where
the information will be retained even if the machine is switched off. Computer memory is used to store data awaiting
processing, instructions loaded from software which are used to process data or control the computer system and data or
information that has been processed. Floppy and hard disks are examples of external memory.

2.4 Output devices

Output devices display the results of computer processing. A computer-based information system will make use of a
number of output devices as a monitor, printer and sound card.



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Business Information Systems Hardware

2.5 Major categories of computers

There are three basic categories of computer: mainframe, minicomputer and microcomputer. We will briefly examine
the characteristics of each category, in order to understand more of how industry makes use of computer technology.

2.5.1 Mainframe

Mainframe computers have been traditional associated with large, powerful machines designed for large-scale data-
processing activities. The use of mainframe computers in industry, once responsible for the large revenues of companies
such as IBM has declined steadily over the past two decades. IBM, Fujitsu and Unisys are current suppliers. Advances
in technology have enabled smaller, less expensive systems to compete with mainframes in terms of speed and power. A
modern personal computer, for example, could be considered many times more powerful than one of the very earliest
mainframe systems. In many organisations, mainframe computers are considered legacy systems, meaning that while
managers recognise that the existing system may not be entirely adequate to meet the company's needs, a changeover
would be difficult to implement.

2.5.2 Minicomputers

The minicomputer combines some of the characteristics of the mainframe computer and the microcomputer. Today, they
are often referred to as servers by companies such as IBM (e.g. the IBM AS/400) and Hewlett-Packard (e.g. HP Alpha).
Different types of server may have different functions, such as managing a network or hosting a database.

2.5.3 Microcomputers

The microcomputer makes use of more modern technology to provide relatively powerful computing facilities at low
cost. Microcomputers are now often referred to as the 'client' machine which receives services and data from a 'server'
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