Chapter 1: Information Systems in Global Business Today

Business Processes: Steps to achieve tasks in an organization.

IT Innovations:

● Cloud computing, mobile platforms, AI, big data, IoT.

E-commerce:

● Services like Facebook, YouTube, and Netflix reshape e-commerce.

Management Changes:

● Virtual meetings, surveys, and real-time access to data improve decisions.

Globalization:

● Internet lowers costs for global trade (e.g., Google).

● Challenges: Job competition, market disruptions (e.g., COVID-19).

Digital Firms:

● Conduct processes like supply chain and customer service digitally.

● Benefits: Remote work, real-time data for decisions.

Strategic Business Objectives of IS:

1. Operational Excellence: Automate to reduce costs (e.g., Walmart).

2. New Products/Services: Apple’s iTunes created new revenue.
3. Customer Intimacy: Amazon’s personalized recommendations.
4. Competitive Advantage: Innovate and stay efficient.
5. Survival: Adapt to regulations (e.g., Citibank’s ATM)

Chapter 2: Global E-Business and Collaboration

Business Process:
A series of steps to achieve a goal (e.g., order processing, hiring).

● Example: Order fulfillment involves customer orders, inventory checks, and shipping.

Improving Processes with IT:

IT reduces errors, tracks in real-time, and speeds up operations.

● Example: UPS uses real-time tracking for better customer service.

Data vs. Information:

● Data: Raw facts (e.g., sales numbers).

● Information: Organized data with meaning (e.g., a sales report).

Types of Information Systems (IS):

 1. TPS: Handles daily tasks (e.g., retail POS systems like Square).
2. MIS: Creates reports from TPS for monitoring (e.g., sales reports).
3. DSS: Helps with non-routine decisions (e.g., holiday sales forecasting).
4. ESS: Provides dashboards for executives (e.g., market trend summaries).

Collaboration Tools:

● Tools like Slack and Google Workspace enable teamwork and faster decisions.
● Example: NASA uses these tools for global projects.

Chapter 3: Information Systems, Organizations, and Strategy

Moore's Law:
Computing power doubles, and prices halve every 18 months.

IT Evolution:

The evolution of IT infrastructure can be understood through several key phases:

● 1959 – Present: General-purpose mainframe and minicomputer computing:

Large, centralized systems used in organizations like banks.
● 1981 – Present: Personal Computing: The development of PCs allowed
businesses to provide employees with individual workstations.
● 1983 – Present: Client/Server Computing: Server systems allowed networks of
computers to communicate with a centralized server, distributing tasks efficiently.
● 1992 – Present: Enterprise Computing: Centralized IT systems enabled the
management of large-scale databases and ERP systems.
● 2000 – Present: Cloud and Mobile Computing: IT infrastructure now extends
beyond physical locations through cloud services, which offer scalable storage,
computing power, and mobile integration.

Key IT Components:

● Hardware: Computers, servers.

● Operating Systems: Windows, Linux.
● Networking: Cisco, cloud providers.

Trends:

● Mobile Computing: Smartphones dominate.

● Cloud Services: Scalable and cost-effective.

IT Challenges:

● Adapting to cloud/mobile.
● Balancing centralized vs. decentralized management.
● Reducing costs (e.g., using cloud solutions).

IT Milestones:

ASCII (American Standard Code for Information Interchange, 1958):

● Enabled computers from different manufacturers to exchange data.

● Became a universal standard for input devices like keyboards.
COBOL (Common Business-Oriented Language, 1959):

● A user-friendly language that enhanced the ability to write business programs.

● Reduced software costs and was sponsored by the U.S. Department of Defense.

Unix (1969–1975):

● A powerful, multitasking operating system compatible across different manufacturers.

● Became widely used by enterprises from the 1980s.

TCP/IP (Transmission Control Protocol/Internet Protocol, 1974):

● Standard communication protocols that enabled computers to connect globally.

● Became the default networking standard for local networks.

Ethernet (1973):

● A network standard for connecting desktop computers into local networks.

● Facilitated the growth of client/server computing and personal computing adoption.

IBM/Microsoft/Intel Personal Computer (1981):

● The "Wintel" standard for personal desktop computing.

● Led to the widespread adoption of low-cost personal computers.

World Wide Web (1989–1993):

● Standards for storing and displaying information globally.

● Created a global repository of web pages with text, graphics, and video

Chapter 4: Ethical and Social Issues in IS

1. Privacy:
○ Businesses collect vast amounts of data from users, raising concerns about
transparency.
○ Example: Facebook faced scrutiny over its data-sharing practices with
Cambridge Analytica.
2. Intellectual Property:
○ Software piracy and copyright violations harm innovation.
○ Example: Unauthorized streaming platforms violate copyright laws.
3. System Quality:
○ Poorly designed systems can lead to harmful outcomes.

Enterprise Systems (ERP):

Centralized software integrates business activities like finance, HR, production, and sales,
ensuring real-time data sharing.
Benefits: Streamlined processes, faster customer response, and better decision-making
tools.
Supply Chain Management (SCM):
Manages material, product, and information flow across suppliers.

● Upstream: Sourcing materials.

● Downstream: Delivering products to customers.
● Push Model: Production based on forecasts.
● Pull Model: Production driven by customer demand.
Benefits: Reduces inventory, improves delivery speed, and cuts costs.

Customer Relationship Management (CRM):

Centralizes customer data to enhance sales, marketing, and service.

● Operational CRM: Automates customer-facing tasks.

● Analytical CRM: Analyzes customer data for insights.
Benefits: Boosts satisfaction, loyalty, and revenue while lowering costs.

Enterprise Application Challenges:

High costs, long development times, and dependency on vendors.

Next-Gen Applications:
Cloud-based, mobile-friendly, social CRM, and embedded AI for real-time analytics.

Ethical Principles:
1. Accountability: Organizations must take responsibility for their systems.
2. Transparency: Users should know how their data is used.

Chapter 5: IT Infrastructure and Emerging Technologies

1. Hardware:
○ Includes devices like servers, storage systems, and networking equipment.
○ Example: Cloud servers from AWS support websites globally.
2. Software:
○ System software (e.g., Windows) vs. application software (e.g., Salesforce).
3. Networking:
○ Wired and wireless infrastructure for communication.
4. Data Management:
○ Databases like SQL and NoSQL store and process structured/unstructured
data.
1. Cloud Computing:
○ Public (AWS), Private (internal), and Hybrid models.
○ Example: Netflix uses AWS for scalable content delivery.
2. Big Data:
○ Characteristics: Volume, Velocity, Variety, Veracity.
○ Example: Twitter analyzes real-time tweets for insights.

Organization: Hierarchies, processes, and culture impact IS use.

Management: Managers use IS for strategy, resource allocation, and decisions.

Technology: Includes hardware, software, and networking infrastructure.

Database: Group of related files. | File: Group of records of the same type. | Record:
Group of related fields. | Field: Group of characters as words or numbers

● Information Policy: Defines the rules and procedures for managing and sharing
data.
● Data Governance: Ensures data is managed according to regulations for integrity,
security, and availability.
● Data Quality: Regular audits and data cleansing are essential for maintaining
accurate, complete, and reliable data

Chapter 6: Foundations of Business Intelligence

1. Challenges with Traditional Systems:
○ Data duplication, inconsistencies, and limited flexibility.
2. Relational DBMS:
○ Organizes data into tables for efficient querying and updates.
○ Example: An HR system tracking employees by ID, department, and salary.
3. Big Data Platforms:
○ Hadoop and Spark process enormous datasets across distributed systems.

The six elements in the business intelligence environment are: 1: Data from the business
environment. 2: Business intelligence infrastructure. 3: Business analytics toolset. 4:
Managerial users and methods. 5: Delivery platforms (ex: MIS, DSS, ESS). 6: User
interfaces, which have data visualization tools.

Descriptive Analytics:

○ Summarizes historical data (e.g., past sales trends).

2. Predictive Analytics:
○ Uses machine learning to forecast future trends (e.g., demand prediction).
3. Prescriptive Analytics:
○ Suggests actions based on predictions.
1. CRM for Customer Intimacy:
○ Example: Adidas personalizes customer experiences through CRM platforms.
2. SCM for Operational Excellence:
○ Example: Amazon uses advanced SCM tools for same-day deliveries.
3. Ethics and Transparency:
○ Businesses must adopt frameworks for ethical decision-making in IT.

Decision-Making Process:
● Intelligence: Identifying and understanding problems.
● Design: Exploring solutions.
● Choice: Selecting a solution.
● Implementation: Applying the solution and monitoring its success.

3. Real-World Decision Making:

● Information Quality: Decisions need high-quality information.
● Management Filters: Biases and selective attention influence managers.
● Organizational Inertia: Resistance to change within firms can impact decisions.
4. Support for Decisions:
● Structured Decisions: Supported by Management Information Systems (MIS).
● Semi-structured Decisions: Supported by Decision-Support Systems (DSS) like
sensitivity and "what-if" analysis.
● High-Velocity Automated Decision Making: Computer algorithms (e.g., high-speed
trading, Google’s search engine).

5. Business Intelligence (BI):

● BI Infrastructure: Collecting, storing, and analyzing data (databases, data
warehouses).
● Business Analytics: Techniques for analyzing data (OLAP, data mining, etc.).
● OLAP (Online Analytical Processing): A tool for quickly analyzing large amounts of
data by organizing it into multidimensional views, helping users easily spot trends
and patterns.
● Data Mining: The process of discovering hidden patterns, relationships, or insights
from large datasets using algorithms and statistical methods.
● Text Mining: A technique used to extract meaningful information, patterns, or
insights from large volumes of unstructured text data.

6. BI Environment:
● Data sources, BI infrastructure, tools (MIS, DSS, ESS), and user interfaces (data
visualization).

7. Predictive Analytics:
● Uses statistical tools, data mining, and historical data to predict trends (e.g., credit
scoring, marketing response).

8. Big Data Analytics:

● Analyzing massive datasets (e.g., social media, sensor data) for real-time insights
(e.g., personalized shopping, smart cities).

9. Decision Support for Senior Management:

● Balanced Scorecard Method: Tracks performance on Financial, Business Process,
Customer, and Learning and Growth dimensions.
● Business Performance Management: Translates strategies into operational goals.

10. Group Decision-Support Systems (GDSS):

● Tools like virtual collaboration rooms and software to rank and edit participant input,
fostering collaborative problem solving (e.g., Cisco’s CMR, Skype for Business).

Data Mining Techniques:

Technique Purpose Example

Association Rules Find relationships in data. "People who buy X also buy Y."

Clustering Group similar data points. Segmenting customers by behavior.

Classification Categorize data. Fraud detection in banking.

Chapter 7: Telecommunications, the Internet, and Wireless Technology

1. Networking Applications:
○ Example: Alibaba integrates online and offline retail using IoT and 5G.
2. Internet Platforms:
○ Example: Google Fiber provides high-speed broadband, enabling rapid
content delivery.
3. Wireless Communication:
○ Example: Starlink by SpaceX delivers internet to remote regions via satellite
networks.
● Components of a Network:
○ Nodes: Devices like computers, printers, or servers.
○ Links: Connections between nodes, like cables or wireless signals.
○ Protocols: Rules for data exchange (e.g., TCP/IP).
1. LAN (Local Area Network):
○ Small geographical area (e.g., office).
○ Example: A company network connecting employees' computers.
2. WAN (Wide Area Network):
○ Large geographical area (e.g., the internet).
○ Example: Global corporate networks.
3. PAN (Personal Area Network):
○ Short distances (e.g., Bluetooth).
○ Example: Connecting a smartwatch to a phone
4. MAN: Covers a city or large campus.

5. CAN: Multiple buildings on a campus..

Telecommunications: Transmission of information (words, sounds, images) via

electromagnetic signals (e.g., telephone, TV, computer networks).

Networking and Communication Trends

● Convergence: Merging of phone and computer networks.
● Broadband: 74% of U.S. users have broadband access.
● Broadband Wireless: Increasing use of wireless broadband for mobility.

Computer Networks
● Components: Client/server computers, NICs, routers, hubs, network operating
systems (NOS).
● Software-Defined Networking (SDN): Centralized program management for
flexibility and efficiency.
 ● Use of LANs, Wi-Fi, servers for websites and intranets, videoconferencing systems.
● Client/Server Computing: Networks where servers control communication and
provide resources to clients.
● Packet Switching: Efficient data transmission by breaking messages into packets.
● TCP/IP: Protocol for standard internet communication, with four layers: Application,
Transport, Internet, Network Interface.
● ISPs offer various connection types:
○ Dial-up: 56.6 Kbps
○ DSL/FIOS: 385 Kbps to 40 Mbps
○ Satellite: Variable speeds
● IP Addressing: Unique 32-bit number for each device on the internet.

Internet Architecture
● Governance: Regulated by bodies like IETF and ICANN.
● Web Technologies:
○ HTML: Standard document language for web browsers.
○ HTTP: Protocol for data transfer.
○ URL: Address for accessing web resources.
● Search Engines (e.g., Google) use algorithms like PageRank to retrieve
information.
● Mobile Searches: Around 50% of searches are mobile as of 2016.
● Includes: Email, IM, FTP, VoIP (e.g., Skype).

Emerging Trends: Web 2.0 and Web 3.0

● Web 2.0: Focuses on interactivity and user-generated content.
● Web 3.0: Future web with IoT and Internet of People.

Wireless Technologies
● Wi-Fi, Bluetooth, WiMax, and Cellular systems enable wireless communication.
● Wireless Sensor Networks (WSN): Devices that monitor environments, fueling IoT.

RFID Technology
● Small tags with microchips used for tracking items via radio signals in supply chains
and toll collections.

Wireless Communication Technologies

● Wi-Fi: Wireless connectivity for devices.
● 5G: Next-generation wireless standard offering higher speed and lower latency.
● IoT (Internet of Things):
○ Definition: A network of connected devices exchanging data.
○ Example: Smart thermostats, wearable fitness trackers.

Technology Application Example

IoT Real-time monitoring. Smart home devices (Nest).

 5G High-speed wireless communication. AR/VR experiences (Meta).

Chapter 8: Securing Information Systems

1. Security Challenges:
○ Example: The 2020 SolarWinds cyberattack affected major corporations
and government agencies.
2. Tools for Security:
○ Firewalls, encryption, multi-factor authentication works 99% of the time.
○ Example: PayPal uses advanced fraud detection to safeguard transactions.
3. Malware:
○ Virus: Attaches to programs and spreads upon execution.
○ Worm: Spreads independently through networks.
○ Trojan Horse: Appears benign but contains malicious code.
4. Phishing:
○ Fake emails/websites trick users into providing sensitive information.
○ Example: Scams impersonating banks.
5. Ransomware:
○ Encrypts files and demands payment for their release.
● Authentication Methods:
○ Passwords.
○ Biometric systems (e.g., facial recognition, fingerprints).
○ Multi-factor authentication (MFA): Combines two or more verification
methods.
● Encryption:
○ Converts plaintext into ciphertext to secure communication.
○ Public and private keys enable secure data sharing.
● Firewalls:
○ Monitors and controls incoming/outgoing network traffic.
● Intrusion Detection Systems (IDS):
○ Identifies suspicious activities within a network

Security Tool Function Example

Encryption Protect data. SSL for secure websites.

Intrusion Detection Detect unauthorized FireEye systems.

access.
 Chapter 9: Achieving Operational Excellence and Customer Intimacy
1. Enterprise Systems:
○ Example: SAP ERP integrates finance, HR, and supply chain functions for
global companies.
2. SCM Applications:
○ Example: Apple optimizes supplier coordination to manage its just-in-time
manufacturing.

System Purpose Example

ERP Integrate core business SAP ERP for logistics.

functions.

CRM Enhance customer relationships. Salesforce for marketing.

1. Cloud Computing:
○ Types: Public, Private, Hybrid.
○ Example: Dropbox for collaboration.
○ Stat: Cloud services revenue grew by 20% in 2023.
2. AI and Machine Learning:
○ Example: Tesla’s autopilot system uses neural networks.
3. Green IT:
○ Example: Google reduced energy use by 40% in data centers with AI.
4. TJX Co. Breach (2006): Hackers led by Albert Gonzalez exploited insecure wireless
networks, affecting 94 million customers and costing $400 million.
5. Heartland Payment Systems (2008): SQL injection attacks exposed 134 million
credit cards, also linked to Gonzalez.

Why Are Systems Vulnerable?

● Hardware Issues: Breakdown or misuse.
● Software Flaws: Coding bugs or unauthorized changes.
● Physical Damage: Natural disasters or accidents.
● External Risks: Insecure external networks.

Common Vulnerabilities
1. Software: Bugs, buffer overflow, and inevitable coding flaws.
2. Internet Risks: Open networks, static IPs, and unencrypted communication.
3. Malware Types:
○ Viruses/Worms: Spread or corrupt systems.
○ Trojan Horses: Disguised threats.
○ SQL Injection: Exploits database weaknesses.

Security Measures
 ● Firewalls & IDS: Block and detect threats.
● Antivirus Software: Identify and remove malware.
● Encryption: Secures data in transit.

Authentication Methods
● Strong Passwords
● Biometrics: Fingerprints, retina scans.
● Two-Factor Authentication (2FA)

Chapter 10: E-Commerce: Digital Markets and Digital Goods

1. Business Models:
○ Example: Uber operates a platform business connecting drivers with riders.
2. Mobile-Commerce Applications:
○ Example: Starbucks’ mobile app enables ordering, payment, and rewards.
● Definition: E-commerce involves using the internet to conduct business transactions.
● Growth: Began in 1995, grew exponentially.
○ 2018 Stats:
■ Online consumer sales > $700 billion.
■ 270 million people online in the U.S. (2018).
■ B2B e-commerce exceeded $7 trillion.

Unique Features of E-Commerce

● Ubiquity: Available anytime, anywhere.
● Global Reach: Crosses cultural and national boundaries.
● Universal Standards: One technology standard (Internet).
● Richness: Supports text, video, audio.
● Interactivity: Examples: Chat windows for support.
● Information Density: Increased transparency in pricing and information.
● Personalization/Customization: Technology allows product and message
modification.
● Social Technology: Encourages content generation and networking.

E-Commerce Growth
● Pre-Recession: Grew 15-25% annually.
● Post-2009: Growth over 10% annually.
● 2022 Tech Crash: E-commerce companies faced slower growth, with stock drops:
○ Uber: -10%
○ Netflix: -58%
○ Meta (Facebook): -70%

Revenue Models

1. Advertising: Display ads (e.g., Google, Facebook).

2. Sales: Selling goods or services directly (e.g., Amazon).
3. Subscription: Regular payment for services (e.g., Netflix).
4. Freemium: Basic service free, premium for features (e.g., Spotify).
5. Transaction Fee: Fee for facilitating a transaction (e.g., eBay).
6. Affiliate: Earning commissions by promoting other’s products.

E-Commerce and Marketing Transformation

 ● Internet Advertising: Behavioral targeting, programmatic ads, and native
advertising.
● Social E-Commerce: Marketing through social networks and influencers.
● Wisdom of Crowds: Large groups make better decisions (e.g., crowdsourcing on
platforms like Kickstarter).

E-commerce models include B2C (business-to-consumer), where companies sell directly to

individuals, such as Amazon. C2C (consumer-to-consumer) involves peer-to-peer
transactions, with platforms like eBay and Etsy enabling individuals to buy and sell goods.
B2B (business-to-business) focuses on transactions between companies, such as IBM and
GE

B2B E-Commerce
● U.S. B2B Trade (2020): $14.5 trillion.
● U.S. B2B E-Commerce (2020): $6.7 trillion.
● Technologies:
○ EDI (Electronic Data Interchange): Computer-to-computer transaction
exchanges.
○ Private Industrial Networks: Secure B2B links.
○ Net Marketplaces: Digital marketplaces for buyers and sellers.

M-Commerce
● Definition: E-commerce via mobile devices.
● 2020 Stats: M-commerce = 45% of all e-commerce.
● Growth Areas:
○ Retailing (e.g., Amazon, eBay).
○ Digital content (e.g., music, TV).
○ In-app sales (mobile devices).

Building an E-Commerce Presence

1. Management Challenges:
○ Understand business objectives and choose the right technology.
○ Develop an e-commerce presence map (website, email, social media).
○ Set clear milestones and timelines.

Key Technologies
● Wireless Internet: Wi-Fi, 4G smartphones.
● Powerful Smartphones/Tablets: Enable web surfing, streaming.
● Wearables: Fitbit, Apple Watch.
● Cloud Computing/SaaS: Streamline business operations.

Digital Goods
● Definition: Goods delivered over a digital network (e.g., software, music).
● Benefits: Low delivery cost, variable pricing.

Chapter 11: Managing Knowledge and Artificial Intelligence

1. AI in Business:
○ Example: Tesla uses neural networks for self-driving technology.
 2. Knowledge Management:
○ Example: Accenture maintains knowledge repositories to train new
employees.
3. Traditional Competitors: Rival businesses continually innovate to improve products
and services.
4. New Market Entrants: New firms can disrupt industries, especially if they leverage
modern technology.
5. Substitute Products: Alternatives, like streaming services replacing CDs, increase
competition.
6. Customers: Easy switching between products lowers prices and affects profits.
7. Suppliers: Powerful suppliers can dictate prices when few alternatives are available.

Information systems help firms manage these forces by:

● New Entrants: Information systems create entry barriers.

● Buyers: Systems lower switching costs and boost loyalty.
● Suppliers: Diversifying suppliers reduces dependency.
● Substitutes: Product innovation and differentiation reduce vulnerability.
● Industry Rivalry: Increases when firms can’t exit easily or the growth rate slows.

Information System Strategies for Competitive Advantage

● Low-Cost Leadership: Achieve cost leadership with efficient supply chains (e.g.,
Walmart).
● Product Differentiation: Innovate to enhance customer experience (e.g., Nike).
● Market Focus Niche: Tailor services for specific segments (e.g., Hilton Hotels).
● Customer and Supplier Intimacy: Build strong relationships with personalized
services (e.g., Amazon).

Impact of the Internet

● Forces industries to adapt (e.g., travel, media).
● Lowers entry barriers, increasing competition and customer engagement.

Smart Products and IoT

● Internet-connected products enhance offerings and customer experience (e.g.,
fitness trackers).
● Increases switching costs and reduces supplier power.

The Business Value Chain Model

● Primary Activities: Direct value creation.
● Support Activities: Help primary activities run efficiently.
● Value Web: A networked model linking operations with suppliers and customers for
collaborative production.
● Firms excel globally in core competencies.
● Synergies arise when outputs from different units serve as inputs for others (e.g., JP
Morgan and Bank of New York merger)
● Network Economics: Adding participants is cheap, but benefits are large.
● Virtual Companies: Collaborate remotely for production and distribution.
● Business Ecosystems: Firms cooperate to enhance services.

Challenges of Strategic Information Systems

 ● Sustaining Competitive Advantage: Systems can be replicated, so innovation is
crucial.
● Aligning IT with Business Goals: IT strategies must match broader business
objectives for success.

AI Application Purpose Example

Natural Language Process human ChatGPT, Alexa.

language.

Machine Learning Predict outcomes. Fraud detection (Visa).

Chapter 12: Enhancing Decision Making

Decision-Making Models:

1. Structured: Routine tasks (e.g., payroll).

2. Semi-Structured: Mix of routine and judgment (e.g., budgeting).
3. Unstructured: Complex, insight-based tasks (e.g., market expansion).

Business Intelligence (BI):

Analyzes data for insights.

● Examples: Dashboards (Tableau), Predictive Analytics (IBM Watson).

● Uses: Coca-Cola monitors sales; UPS optimizes logistics.

Ethical and Legal Issues in IS

Volkswagen Scandal: VW used software to fake emissions tests. Cost: $87 billion.

Ethical Concerns:

● Data privacy (e.g., cookies, spyware).

● Tech-driven dilemmas: Job cuts, employee monitoring.

Advances in Data Analysis:

● Profiling: Creating personal data profiles.

● NORA: Reveals hidden data connections.

Key Ethical Principles:

1. Golden Rule: Treat others as you want to be treated.

2. Utilitarian: Maximize good for the majority.
3. No Free Lunch: Assume ownership unless specified.

Privacy and Security: Opt-out vs. Opt-in policies. Tools: Email encryption, anti-spyware.
 Health Risks: RSI, CTS, eye strain, technostress.

BI Tool Purpose Example

Dashboards Visualize data. Tableau.

Predictive Analytics Forecast IBM Watson for retail.

trends.