Management

Information
Systems

Term: 2014/2015
ITU Management Faculty
Management Information Systems
Nihan YILDIRIM
Computer Science is no more
about computers than
astronomy is about
telescopes.”

— E. W. Dijkstra
Grading Criteria

Attendance : %70 required as visa

Term Project/Paper : 30% (< 40/100 =>VF)

Midterm Exam : 30%

Final Exam : 40%

LECTURER

 Nihan Yıldırım, Management Engineer, PhD,

MSc. Eng

 [email protected]
 [email protected]
 Room no: 601 Management Faculty
Building
 Course Cover
Introduction to systems and MIS
1. Objectives and Overview of the Course
2. Systems, Information, Data, Knowledge
3. Information Technology, Information Economy and Society
4. Management Information Systems
I) IS in Organizations, Management and the Networked Enterprise
1. Information Systems in (Global) Business Today
2. How Businesses Use Information Systems : Strategic use of Information Systems
in Digital Economy
3. Management Information Systems Concepts
4. Digital Firm: Information Systems in Organizations and Strategy Making
II) Building Systems
1. Information Technology Economics
2. Building Information Systems: A Technical View of Systems Analysis and Design
3. System Modelling
4. Introduction and Technology guide to Software and Software Management
5. Project Management: Establishing the Business Value of Systems and Managing
Change
III) Information Technology Infrastructure
1. Introduction to Hardware Assets
2. IT Infrastructure and Emerging Technologies
3. Managing Hardware Assets
Overview
MIDTERM EXAM
Course Cover
III) Information Technology Infrastructure
1. Introduction to Data and Databases
2. Data management and Information Management: Foundations of Business
Intelligence
3. Introduction to Telecom, Internet and the Web
4. Telecommunications: the Internet, Mobile, Wireless and Pervasive
Technologies
5. Network Computing: Communication and Collaboration
IV) Key System Applications for the Digital Age
1. Using IT to Achieve Competitive Advantage
2. Enterprise Systems, Achieving Operational Excellence and Customer
Intimacy
3. Transaction Processing, Functional Applications, CRM, and Integration
4. E-Business and E-Commerce: Digital Markets, Digital Goods
5. Knowledge Management or Managing Knowledge
6. Decision Support and Intelligent Systems : Enhancing Decision Making
V) Managing Systems
1. Managing Information Resources
2. IT Security : Securing Information Systems
3. Global Interorganizational Systems and Managing Global Systems
4. Ethical and Social Issues in Information Systems : The Impacts of IT on
Organizations, Individuals, and Society
Overview and Conclusion
Course Schedule
 Week 1: Introduction to Systems and MIS
 Week 2: I) IS in Organizations, Management and the Networked Enterprise
Article Reading – Case Study
 Week 3: I) IS in Organizations, Management and the Networked Enterprise (cont.)
TERM PROJECT : TEAM BUILDING, SUBJECT SETTING
 Week 4: II) Building Systems
Article Reading – Case Study
 Week 5: II) Building Systems (cont.)
 Week 6: III) Information Technology Infrastructure
 Week 7: III) Information Technology Infrastructure (cont.) – Overview

Week 8 : MIDTERM EXAM

 Week 9: III) Information Technology Infrastructure (cont.)

SEMINAR WITH A PROFESSIONAL
 Week 10, 11: IV) Key System Applications for the Digital Age
Article Reading – Case Study
 Week 12: IV) Key System Applications for the Digital Age
SEMINAR WITH A PROFESSIONAL
TERM PROJECT SUBMISSION
 Week 13: V) Managing Systems
SEMINAR WITH A PROFESSIONAL
Article Reading – Case Study
 Week 14: V) Managing Systems
Overview and Conclusion

FINAL EXAM
 Course Notes

Course notes and Articles/Case Studies will be available from

NİNOVA and Copy Room:

Document Availability Schedule:

Course Cover for MidTerm Exam: Week 2
Course Cover from Midterm Exam: Week 9
 References:
1. Kenneth C. Laudon & Jane Price Laudon : Management Information
Systems –Managing the Digital Firm, Pearson, U.S.A., 11th edition, 2010.
2. Efraim Turban, Dorothy Leidner, Ephraim McLean, James Wetherbe
Information Technology for Management: Transforming Organizations in
the Digital Economy, 5th Edition, 2006, Wiley.
3. Kenneth C. Laudon & Jane Price Laudon : Information Systems and The
Internet – A Problem Solving Approach, The Dryden Press, U.S.A., 1998.
4. Kenneth C. Laudon, Jane P. Laudon. Essentials of business information
systems. Pearson/Prentice Hall, 2007
5. Joseph Valacich & Leonard Jessup: Information Systems Today: Why IS
Matters, Second Edition, Prentice Hall, U.S.A. 2005.
6. Peter Weill & Marianne Broadbent: Leveraging the New Infrastructure- How
Market Leaders Capitalize on Information Technology, Harvard Business
School Press, Boston, U.S.A, 1998.
7. MIT OCW
 Course
 Course Description:
 Basic concepts of management information systems,
evolution of information systems; the needs and the use of
information systems in business and management for
effectiveness and competitive advantage; methods of
analyzing, designing, developing and managing information
systems; knowledge management, business intelligence,
enterprise systems, e-commerce.

 Course Objectives:
1. To teach the basic technologies, concepts and components
of management information systems together with the basic
methods, principles and techniques for analyzing, designing,
improving, managing and using these systems by using
application practices.
2. To provide a systematical, analytical and managerial
perspective for benefiting from information systems in
solving process/organization/management problems, by
explaining the role of these systems in improving
effectiveness and competitive advantage in
enterprises/organizations.
 Course
 Course Learning Outcomes:
Students who will successfully complete this course will be able
I. To understand the role of management information systems in
improving effectiveness and competitive advantage in organizations,
and hence to achieve competencies for benefiting from information
technology in decision making and in solving
process/organization/management related problems.
II. To have significant knowledge about the basic concepts and
processes of information systems
III. To be informed about the technologies that are related to information
systems.
IV. To apply basic techniques and principles of using, analyzing,
designing, developing and managing business information systems
for the improvement of effectiveness in business processes.
V. To be concerned about the technical, economic, social and ethical
issues about information systems and information technology.

 Additional Personal Benefits: Awareness for the critical importance of :

IT competency in professional life

information systems security
Ethical and social issues related to information technology
 Course Introduction
Every few years, computers will be able to support (or automate)
more of the activities that go on in businesses.

Therefore, some of the most important technology opportunities

won’t involve making new technologies, but in figuring out new
ways to use technologies.

Finding (and exploiting) the most promising of these new

opportunities can give you significant advantages.

Please do not forget:

! Knowledge of information technology and information systems is crucial
for all of us (irrespective of your discipline and your job!) in our
professional and civil life!

! Being competent in understanding IT and ISs improve communication

building and problem solving skills!
Introduction to
Management
Information Systems

Week 1

ITU Management Faculty

Management Information Systems
N. YILDIRIM
 Why and How Information Technology
and Systems are used in organization?

Information
 Corporate strategy technology

COMPETITIVE
ADVANTAGE
TECHNOLOGY IMPACTS STRATEGY BY:
1. SUPPORTING COST AND DIFFERENTIATION STRATEGIES
2. SPAWNING ENTIRELY NEW BUSINESSES
a) new business economically feasible
b) created by new demand
c) create new business within old
d) information by-products
3. ALTERING INDUSTRY STRUCTURE

(by Prof. Stuart Madnick-MIT)

Why and How Information Technology
and Systems are used in organization?
Why and How Information Technology
and Systems are used in organization?
 Why and How Information Technology
and Systems are used in organization?

Value chain model. (Diagram by Prof. Stuart Madnick-MIT)

 strategic importance of information technology

 identification of strategic applications alone does not result in success for
an organization.
 A careful coordination of strategic applications, information technologies,
and organizational structures
 strategic, technological, and organizational connectivity support effective
and meaningful integration of information and systems.
 Information Technology
Capital Investment
Today, organizations recognizes the importance of managing
“resources of information” and “informative processes” as well as
basic resources such as labor, capital, and raw materials.
Management Information Systems
Today, organizations recognizes the importance of managing “resources
of information” and “informative processes” as well as basic resources
such as labor, capital, and raw materials.

MIS:
is the application of information technology to support the major
functions and activities of an organization (private, public or NGO)
support processes of collection,usage, storage, distribution and
utilization of an organization's information resources.
provide feedback on organisational activities and help to support decision
making in all business levels.

MIS help;
to establish relevant and measurable objectives
to monitor results and performances (reach ratios)
to send alerts, in some cases daily, to managers at each level of the
organization, on all deviations between results and pre-established
objectives and budgets.
 Index – Introduction to MIS
RE-”MIND”ING SYSTEMS
1. Definition of Systems
2. Elements of Systems – Processing
a System
3. Components and Concepts
4. Types of Systems
5. Performance of Systems
6. Variables and Parametres
7. System Models
8. Working with Systems
 System Analyst
 Problem identifier, analyser, solver and preventer – Project team member
 Not only in information systems, in all organisational systems
 Finds out what the organisation need their systems to do.
 Plans a system that can do those tasks well, integrated with other system
and working together well
 Breaks down the task into small steps.
 Draws diagrams and charts to show how work and information will flow and
be processed and get to the points in need
 Experiment with different system plans. They try various tools and steps until
they find the system that is fastest, easiest, and costs the least.
 Tell programmers/production elements how to make any new software or
machine that is needed. T
 Give them step-by-step instructions.
 Tests the systems to make sure they work as planned – on time, with no
mistake, easily
 Identify the problems and improvement needs
 Develops, improves the systems.
 Development Cycle of Information Systems
Identify the
problem

Identify data,  Understand the problem

Collect data  Devise a plan
 Carry out the plan
Analyse the  Look back Control and
system Feed back to
Task to improve
Choose the solution
be
Develop the model
performed
Design the
system

Build/Implement/ Test the Use the

Produce the system system system
Development Cycle of IS as a Problem
solving process

-Find out as much as you can

• Reuse what has been done

before

• Expect future reuse

• Break complex problems into

subproblems
 Systems Approach to Problems

• Understand and define the problem before attempting to solve it as a system

• Identify the system boundaries, inputs and outputs to a system
• Decompose the system to lower levels (subsystems) with more detail
• Understand the functions that the systems perform to convert inputs to outputs
• Identify and rank all possible solutions prior to selecting an answer
• Looking for hybrid solutions to add to the set of alternatives
• Select a solution, capture the analysis and formulate the subsequent problem or
implementation of the solution
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
 Management Information Systems
Chapter 1 Information Systems in Global Business Today
Working with Systems
 Systems development
 The activity of creating or modifying an existing business
system
 Systems investigation and analysis
 Defines the problems and opportunities of an existing
system
 Systems design
 Determine how a new system will work to meet business
needs
 Systems implementation
 Creating and acquiring system components defined in the
design
 Systems maintenance and review
 Checks and modifies the system so that it continues to
meet changing business needs
System Development Loop
Need for Required =? Existing
Systems
development

Systems DEFINING THE PROBLEM : Understanding the

current system or need for the system –

Modifications
Revisions

Preventive Actions
Corrective Actions
analysis Requirements List, “Contract”, What is the Gap?

Systems FINDING THE SOLUTION : Designing/Defining the

design “needed/required” system– Specifications, “How it
should be?”

Systems IMPLEMENTING THE SOLUTION :

implementation Building, Project, Hands-on work,
“Closing the Gap”
Documentation
Training PERFORMANCE
Systems
Structural Change EVALUATION : Control,
(+Revision)
Review And Audit Check, “Measuring the
Gap”
Systems
maintenance
and improvement
System Development Loop

Definition of the System
different than a group or a collection
 an entity which maintains its existence
through the mutual interaction of its parts.

 component, interaction, goal – input, process, output

 A set of elements or components that work together and
interact to accomplish goals (at least 2 elements directly or
indirectly dependent on others)
 A Windows system is a personal computer running the Windows operating
system. A desktop publishing system is a computer running desktop
publishing software.

 A combination of components working together

 Components can be subsystems

a computer system includes both hardware and software .

 An organization or methodology
 The binary numbering system, for instance, is a way to count using only two
digits.
 Simple Definition
 A system is a construct or collection of interrelated elements,
attributes and relationships that together produce outputs not
obtainable by the elements alone.
 The outputs include system level qualities, properties,
characteristics, functions, behavior and performance.

System

Products
Input System
Elements Output

People Processes
 System Elements

• System is composed of elements that satisfy one or more requirements.

• System Elements

– People
• Personnel
– Products
• Hardware
• Software
• Facilities
• Data
• Materials
– Processes
• Services
• Techniques

Ref: MIL-STD-499B
 System A system is an entity which maintains its
existence through the mutual interaction
of its parts.
Open systems ENVIRONMENT

System  Aim- Goals – the need for the system

 objects – the parts, elements, or variables
Common Goal
within the system. These may be physical or
abstract or both, depending on the nature of
OBJECT A OBJECT B the system.
(Sub-system?)
 attributes – the qualities or properties of the
Attributes Attributes system and its objects.
 internal relationships among its objects.
 Environment

Interactions
System > A+B
Boundaries  A system, then, is a set of things that affect
one another within an environment and form
maintains the system Hard to draw
a larger pattern that is different from any of
the parts.
 System
 Something beyond cause and effect.

 Rather than simply A affects B, there is an implication that B

also affects A. (Ex. particle, atom, molecule, cell, organ, person,
community, state, nation, world, solar system, galaxy, and
universe, in increasing levels of complexity).

 In truth there is only one system, "the Universe," and all other
systems are really just sub-systems of this larger system.

 The relevant question has to do with where one chooses to

draw boundaries
System Components and
Concepts
 System Environment
 Elements and the relevant attributes of the systems that are not
part of the system, but can affect the system when changed

 Variables that can affect the state of the system (the relevant
attributes of the system)

 Ex: Logic is the environment of mathematics

 System boundary
 Defines the system and distinguishes it from everything else
 Systems are not independent. They are a part of their environments.
 Information systems: generally integrated and interact with other
systems.
 But they are not open ended
Defining Environments
 Systems and their environments are objectively defined. BUT:

 The definition and scope depends on the goal of the research.

 Systems and environments can vary from one observer to another

 EX: Architect: The building is a system including electrical, heating,
water systems

 Mechanical Engineer: Heating system is a system, building is its

environment

 Social psychologist: Family is the system. House is the environment

(not interested in heating etc.
 The fundamental systems-interactive paradigm of
System organizational analysis features the continual
stages of
-input,
-throughput (processing),
-and output,
which demonstrate the concept of
openness/closedness

Example:
 Organization is made up of many administrative
and management functions, products, services,
groups and individuals.
 If one part of the system is changed, the nature of
the overall system is often changed, as well –
 By definition then, the system is systemic,
meaning relating to, or affecting, the entire
system.
 System Example

Elements
System Goal
Processing
Inputs Outputs
elements
Actors, director, Filming, Finished film Entertaining
staff, sets, editing, delivered to movie, film
Movie equipment special movie studio awards,
effects, profits
distribution
 System Components and
Concepts
 System and its Environment – System Perspective Model
System Components and
Concepts
 State of the system:
 Total of relevant attributes of the system within a time
period.
 All systems have unlimited attributes.
 The “goal” of the research defines the relevant attributes
 State of the environment:
 Set of relevant attributes in the environment of a system in a specific
period of time
 System boundary
System Components and
Concepts

 System Event:
 occurs within the system or in its
environment in a specific period of time
 Changes the structural attributes of the
system and environment
 Changes the state of the system
System Components and
Concepts

 Act of the system:

 Not necessary nor obligatory for the system
 Autonomous events of the systems –
proposed by the system itself
 Internal changes in the status of the system
elements are necessary and obligatory
 Organic changes
 System Components and
Concepts
 System Reaction:
 A system event (with an expected system reaction time)
 Necessarily caused by another event (consciously) in the system or in
systems environment – Cause is sufficient for reaction
 All events may not cause the same reaction
 All reactions may not have the same causes (events)
 Turning the key : motor stars
 System Response:
 A system event
 Essentially caused by another event in the system or in its environment -
stimulus factor - Cause is necessary but not sufficient for response
 Turning on the lights : response to dark
 System Behaviour:
 A system event
 Necessarily and essentially causes another event in the system
or in its environment.
 Changes in the system that starts another event

Causes of the acts, reactions and responses are important- Results/effects of the
behaviour is important.
 System Behaviour

Behavior is perceived by the an external observer (usually

user or external entity).

Behaviour

Functionality ..... What functions the system performs

+
Time-Related
Performance ..... How Well the functions should
perform

Since behavior is defined by both functionality and performance, always define the
functionality with associated performance criteria !
System characteristics
 wholeness and interdependence (the whole is more than the sum
of all parts),
 correlations,
 perceiving causes,
 chain of influence,
 hierarchy,
 suprasystems and subsystems,
 self-regulation and control,
 goal-oriented,
 interchange with the environment,
 inputs/outputs,
 the need for balance
 change and adaptability (morphogenesis)
System Types
 Simple vs. complex
 Simple systems
 possible to define system outputs from known inputs
 Does not require high level system analysis and review
 Chair, with not moving parts
 A Complex System
 Multitude of parts and relationships
 involves a number of elements, arranged in structure(s)
which can exist on many scales.
 go through processes of change that are not describable
by a single rule nor are reducible to only one level of
explanation, these levels often include features whose
emergence cannot be predicted from their current
specifications. Ex: Genetic Algorithms, Neural Networks-
learn by example.
 Requires high system analysis and review
System Types
 Open vs. closed :
 Open system
 regularly exchanges feedback with its external environment
 porous boundaries through which useful feedback can readily be
exchanged and understood.
 continuously exchange feedback with their environments,
analyze that feedback, adjust internal systems as needed to
achieve the system’s goals, and then transmit necessary
information back out to the environment.
 Closed system:
 have hard boundaries through which little information is
exchanged. (nearly no interaction with environments)
 Do not interact with an environmental element.
 Organizations that have closed boundaries often are
unhealthy. Examples include bureaucracies, monopolies
and stagnating systems.
orgs-open-systems.pdf
 System Types
 Adaptive vs. nonadaptive
 Adaptive system:
 Adoptive to environment
 agents (which may represent cells, species,
individuals, firms, nations) acting in parallel,
constantly acting and reacting to what the other
agents are doing.
 ability to recognize the shape of a problem and
tailor its responses, changes its behavior based on
its environment.
 handle complex problems
 Non-adaptive System
 Fail to adopt to environment
 Steady
 System Types
 Stable vs. dynamic
 Dynamic systems :
 Multi-state: events, changes in structure in time
 Fluctuate rapidly
 Such systems have the capacity of ‘remembering’ what it had
been subjected to previously, or has some memory built into it.
 Described by dynamic equations or differential equations of
appropriate type.
 Boundaries can be difficult to identify when systems can be
very dynamic.
 Stable/ Static Systems:
 One state system – no event, no change
 In equilibrium (steady state) with no significant changes taking
place.
 Described in simple mathematical terms by a set of algebric
equations.
 Classification can depend on the observer/goals of the system
 Building: Stable for residents, dynamic for engineer (corrosions
etc)
System Types
 Deterministic vs. Stochastic
 Deterministic: predictable in every detail

 Stochastic: Behaviour is affected by random

inputs
System Variables and
Parameters
 System variable
 A quantity or item that can be controlled by
the decision maker
 E.g. the price a company charges for a
product
 System parameter
 A value or quantity that cannot be
controlled by the decision maker
 E.g., cost of a raw material
 Systems Principles
Some principles that are common to systems, many of which help us to better understand
organizations.
 The system's overall behavior depends on its entire structure (not the sum of its
various parts).
 The structure determines the various behaviors, which determine the various
events. Too often, we only see and respond to the events. That's why, especially
in the early parts of our lives, we can be so short-sighted and reactionary in our
lives and in our work. We miss the broader scheme of things.
 Too often in organizations we think we can break up the system and only have to
deal with its parts or with various topics apart from other topics. Systems theory
reminds us that if you break up an elephant, you don't have a bunch of little
elephants.
 There is an optimum size for a system.
 If we try to make the system any larger, it'll try to break itself up in order to
achieve more stability. Too often in our organizations, we continually strive to
keep on growing -- until the reality of the system intervenes. At this point, we
again only see the events, not the behaviors or the structures that cause them.
So we embark on short-sighted strategies to fix events, often only causing more
problems for ourselves and others.
 Systems tend to seek balance with their environments
 A circular relationship exists between the overall system and its parts.
 Organizations may experience the same kinds of problems over and over again.
The problems seem to cycle through the organization. Over time, members of
the organization come to recognize the pattern of events in the cycle, rather than
the cycle itself.
 System Modelling
 System modeling helps the analyst to understand the
functionality of the system, and models are used to
communicate with other related parties
 Different models present the system from different
perspectives
 Context Models - External perspective: system’s context or
environment:
 process, activity, inter-system data-flow
 Behavioral Models - perspective: behavior of the system:
 Data-flow, data-processing, state machine
 Logical/Structural Models - perspective: the system or data
architecture
 Entity-relation, object
Modeling a System
 Model
 An abstraction or an approximation that is
used to represent reality
 Types of models
 Narrative (descriptive)
 Physical
 Schematic
 Mathematical
System Performance and
Standards
 Efficiency
 A measure of what is produced divided by what is
consumed
 Effectiveness
 A measure of the extent to which a system
achieves its goals
 System performance standard
 A specific objective of the system