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Summary of "Management Information Systems - Managing the digital firm" by Laudon. Chapters 1, 2, 3 and 4 of the first year of Hotel Management.
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MIS exam week 2Chapter 1 – Information systems in global business
today
1.1 – How are information systems transforming global business, and
why are they so essential for running and managing a business
today?
Five changes in the MIS field that are of high importance:
IT innovations (e.g. cloud computing)
New business models (e.g. Netflix)
E-commerce expanding physical products, but also online services
Management changes mobile business
Changes in firms and organizations greater emphasis on competency and skills
rather than position in the hierarchy.
A significant percentage of the global economy depends on imports and exports. Not only
goods, but also jobs move across borders.
The emerging digital firm
Digital firm: one in which nearly 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 networks spanning the entire
organization or linking multiple organizations.
Business processes: set of logically related tasks and behaviors that organizations develop
over time to produce specific business results and the unique manner in which these
activities are organized and coordinated.
Key corporate assets (intellectual property, core competencies, and financial and human
assets) are managed through digital means.
In digital firms, both time shifting and space shifting are the norm:
Time shifting: business being conducted continuously.
Space shifting: work takes place in a global workshop as well as within national
boundaries.
Strategic business objectives of information systems
There is a growing interdependence between a firm’s ability to use information technology
and its ability to implement corporate strategies and achieve corporate goals.
Business firms invest heavily in information systems to achieve six strategic business
objectives:
Operational excellence New products, services, and
business models
, Customer and supplier intimacy Competitive advantage
Improved decision making Survival
Business model: describes how a company produces, delivers, and sells a product/service to
create wealth.
1.2 – What is an information system? How does it work? What are its
management, organization, and technology components? Why are
complementary assets essential for ensuring that information
systems provide genuine value for organizations?
Information technology (IT): all the hardware and software that a firm needs to use in order
to achieve its business objectives.
What is an information system?
Information system: a set of interrelated components that collect (or retrieve), process,
store, and distribute information to support decision making and control in an organization.
Information: data that have been shaped into a form that is meaningful and useful to human
beings.
Data: streams of raw facts representing events occurring in organizations or the physical
environment before they have been organized and arranged into a form that people can
understand and use.
Three activities in an information system produce the information:
Input: captures/collects raw data from within the organization or from its external
environment.
Processing: converts raw input into a meaningful form.
Output: transfers the processed information to the people who will use it or to the
activities for which it will be used.
Feedback: output that is returned to appropriate members of the organization to help them
evaluate/correct the input stage.
Dimensions of information systems
Information systems literacy: the broader understanding of information systems, which
encompasses an understanding of the management and organizational dimensions of
systems as well as the technical dimensions of systems.
Computer literacy: focuses primarily on knowledge of information technology.
The dimensions of information systems: organizations, management, and information
technology.
Organizations:
The key elements of an organization are its people, structure, business processes, politics,
and culture.
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