MBA 601

Business Information System

Department of Management
Admas University
Computer System and Software
Technology Development

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 Content
 Computers and Information Processing

 System Hardware

 Information System Software

 Management Issues

 Software development process

 Data Resource Management

 Hierarchy of Data
 Solutions to managing data

 Data warehouse, Data marts and Data centers

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Computers and Information Processing
 Computer is an electronic device, operating under the
control of instructions stored in its own memory that
can accept data (input), process the data according to
specified rules, produce information (output), and
store the information for future use
 Effects of using computer
 Speed of processing & accessing of data increases -
timeliness of information can be met
 Scope of analysis widened - more data can be considered in
analysis
 Effectiveness of information system increases - because
timeliness and accuracy of information is increased.
 More comprehensive information is made available to
executives - covering all aspect of the problem.
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Computers and Information Processing(cont’d)

PROCESSING
SYSTEM

DATA
INFORMATION
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 Types of Computers
 Based on processing capability of computers:
 Supercomputers - the most powerful, fastest, largest and expensive
computer.
 Application: global weather forecasting, military defense systems,
astronomy, microprocessor research and design, etc.
 Mainframes- large, fast, and powerful computer systems
 Application: to handle high transaction in banks, airlines,
telecommunication companies, etc.
 Minicomputers
 Application: for scientific research, engineering analysis, and industrial
process monitoring and control.
 Microcomputers, some times called Personal Computer(PC)
 Integrated Computing
 Along with advances in computers themselves, computing technology
is being integrated into many everyday products. From automobiles to
refrigerators to airplanes.
 Example: Smart House, Self-Driving Car
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 Computer System
 A computer is a system, an interrelated combination
of components that performs the basic system
functions of input, processing, output, storage, and
control, thus providing end users with a powerful
information processing tool
 Components of computer system:
 A. Hardware – physical element
 B. Software – is a set of instructions that tells the hardware
what to do

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 Hardware
 Any machinery that assists in the input, processing,
storage, and output activities of an information system
 Hardware Components
 A. Central processing unit (CPU)
 A hardware component that performs computing functions utilizing
the ALU, control unit, and registers.
 Arithmetic/logic unit (ALU)
 Performs mathematical calculations and makes logical comparisons
 Control unit
 Sequentially accesses program instructions, decodes them, coordinates
flow of data in/out of ALU, registers, primary and secondary storage,
and various output devices
 Registers
 High-speed storage areas used to temporarily hold small units of
program instructions and data immediately before, during, and after
execution by the CPU

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 Hardware(cont’d)
 B. Primary storage(main memory)
 Holds program instructions and data
 C. Secondary storage
 Store data and programs permanently. E.g. Hard disk, flash disk,
magnetic tape, etc.
 D. Input devices
 Provide data and instructions to the system and convert to machine
understandable format. E.g. Keyboard, mouse, scanner, barcode
reader, microphone, etc.
 E. Output devices
 Presents the result of processing. It converts the result of the only-
machine understandable form to a form understandable by human
beings.
E.g. Monitor(soft copy output), printer(hard copy output), speaker, etc.

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 Hardware(cont’d)
Communications
devices

Processing device

Control Arithmetic/
unit logic unit
Input devices Output devices
Register storage area

Memory

Secondary
storage

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 Software
Two types:
1. Application and
2. system software

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 Software(cont’d)
1. Application Software
 subdivided into general-purpose and function-specific
 General-purpose application programs are programs that
perform common information processing jobs for end users.
 Example: word processing, spreadsheet, database management,
graphics, web browsers
 function-specific application software packages are available
to support specific applications of end users in business and
other fields.
 Example: customer relationship management, enterprise resource
planning, and supply chain management, etc.

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 Software(cont’d)
2. System Software
 System Software enables the application software to interact
with the computer hardware.
 Operating Systems are programs that coordinate computer
resources, provide an interface between users and the
computer; and run applications. E.g. Windows 10, Linux, etc.
 Utilities perform specific tasks related to managing computer
resources. E.g. Antivirus
 Device drivers are specialized programs designed to allow
particular input or output devices to communicate with the rest
of the computer system

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 Information System Software
 Enterprise Resource Planning(ERP)
 ERP (sometimes just called enterprise software) - collects data from
different firm functions and stores data in single central data
repository to be shared among firm
 Some of the more well-known ERP systems include those from SAP,
Oracle, Odoo, and Microsoft(Microsoft Dynamics GP).
 Benefits:
 Integration
 Mobility
 Flexibility
 Productive
 Collaborate
 Secure

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 How Do ERP System Work?

Managers and
Stakeholders
Financial
Reporting Applications
Human
Sales and
Resource Applications
Delivery
Management
Applications
Applications
Sales Force Central
Manufacturing Back-office
Customers And Customer Database
Service Reps Applications Administrators Suppliers
And Workers

Service Human
Applications Resource Inventory
Management And Supply
Applications Applications

Employees

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 Information System Software(cont’d)
 Customer Relationship Management(CRM)
 Provide information to coordinate all of the business processes that
deal with customers in sales, marketing, and service to optimize
revenue, customer satisfaction, and customer retention.
E.g. Salesforce.
 Supply Chain Management(SCM)
 manages the interconnection between the an organization’s suppliers,
its manufacturing facilities, and the distributors of its products, as well
as the inventory of the products in their various stages of
development.

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 Information System Software(cont’d)
 Cloud service
 Cloud refers to applications, services, and data storage on the
Internet. E.g. Google Drive’s application, Sales force, etc.
 Advantages:
 No software to install or upgrades to maintain.
 Available from any computer that has access to the Internet.
 Can scale to a large number of users easily.
 New applications can be up and running very quickly.
 Your information is not lost if your hard disk crashes or your laptop is
stolen.
 You are not limited by the available memory or disk space on your
computer.
 Disadvantages:
 Your information is stored on someone else’s computer – how safe is it?
 You must have Internet access to use it.
 You are relying on a third-party to provide these services.

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IS Development Process

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 IS Development Process(cont’d)
 The Definition phase is critical: It justifies the systems
development work and defines precisely what the
system must do in sufficient detail for IS specialists to
build the right system.
 Feasibility study: economic, operational, and technical
 In the Construction phase, the IS specialists produce
a working system according to the specifications set
forth in the earlier phase.
 In the Implementation phase, the new system is
installed, becomes operational within the organization,
and is maintained (modified) as needed so that it
continues to reflect the changing needs of the
organization.
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 Management Issues
 Dealing with platform and infrastructure change
 Firms require new policies and procedures for managing new
platforms
 Management and governance
 Each organization will need to arrive at answers based on its
own needs for the following questions:
 Who will control and manage the firm’s IT infrastructure?
 Should IT infrastructure be centrally controlled and managed? or
should it be by departments and divisions?
 What is the relationship between central information systems
management and business unit information systems management?
 How will infrastructure costs be allocated among business units?

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 Management Issues(cont’d)
 Making wise infrastructure investments
 How much should the firm spend on infrastructure?
 Should purchase or rent(cloud) IT infrastructure?
 The actual cost of owning technology resources includes:
 original cost of acquiring and installing hardware and software
 ongoing administration costs for:
 hardware and software upgrades,
 maintenance,
 technical support,
 training, and
 utility and real estate costs for running and housing the technology
 Total cost of ownership (TCO) model can be used to analyze
these direct and indirect costs
 Hardware and software acquisition costs only about 20
percent of TCO, so managers must pay close attention to
administration costs
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TCO cost components

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 Data Resource Management
 The data resource consists of the facts and
information an organization gathers while conducting
business and in order to conduct business at all levels
of the organization.
 Data is an organization’s informational asset.
 Data can be an asset only if they are available and understood
when needed and purged when no longer useful
 Difficulties with managing data
 Amount of data is increasing- every 18 months data of an
organization becomes double.
 Data is scattered throughout the organization
 Data quality and security

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 Data Resource Management(cont’d)
 Data management helps companies improve
productivity by ensuring that people can find what they
need without having to conduct a long and difficult
search.
 Goal to transform raw data into usable corporate
information of the highest quality.
 Managers make decisions and service customers based on
the data available to them.
 Managers need rapid access to correct, comprehensive, and
consistent data

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The Hierarchy of Data

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 Solutions to managing data
 Manual Approach
 File Management
 Database Management Systems (DBMS)

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 Manual Approach
 Typing the data on paper and put in a file cabinet
 Works well if the number of items to be stored is small.
 Limitations
 Prone to error
 Difficult to update, retrieve, integrate
 You have the data but it is difficult to compile the information
 Limited to small size information
 Cross referencing is difficult
 Two computerized approaches evolved to overcome
this limitations
 A. File based approach  decentralised
 B. Database approach centralised

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 File-Based Approach
 A collection of application programs that perform
services for the end-users. Each program defines
and manages its own data.
 This approach is to develop a program or a number of
programs for each different application.
 File based systems were an early attempt to
computerize the manual filing system.

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File-Based Approach(cont’d)

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 File-Based Approach(cont’d)
 Limitations
 Data Redundancy (Duplication of data)
 Same data is held by different programs
 Wasted space
 Separation or isolation of data
 Each program maintains its own set of data.
 Users of one program may be unaware of potentially useful data
held by other programs.
 Data Inconsistency and confusion
 E.g. Consider an organization:
 Personnel Department stores details relating to each
member.
 Payroll Department stores salaries of each staff
 There are potentially different values and/or different
formats for the same item
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File-Based Approach(cont’d)
 Consider the duplication of data between the payroll and
personnel departments . If an employee moves house and the
change of address is communicated only to personnel and not
to payroll, the person’s pay slip will be sent to the wrong
address.
 A more serious problem occurs if an employee is promoted to
a more senior position with an associated increase in salary.
Again, the change is notified to personnel but the change does
not filter through payroll. And the employee may be getting the
wrong salary.

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 Database Approach
 A Database is shared collection of logically related
data (and a description of this data), designed to meet
the information needs of an organization.
 Shared collection- can be used simultaneously by many
departments and users
 Logically related data comprises entities, attributes, and
relationships of an organization's information.
 System catalog (data dictionary or metadata) provides the
description of the data.
Example: Student data base, Inventory database, hotel
reservation data base, online book data base, etc

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The Database Approach to Data
Management

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 Advantages
 Data can be shared
 two or more users can access and use same data instead of
storing data in redundant manner for each user.
 Improved accessibility of data
 by using structured query languages, the users can easily
access data without programming experience.
 Redundancy can be reduced
 isolated data is integrated in database to decrease the
redundant data stored at different applications.
 Quality data can be maintained
 the different integrity constraints in the database approach will
maintain the quality leading to better decision making

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 Advantages(cont’d)
 Transaction support can be provided
 basic demands of any transaction support systems are
implanted in a full scale DBMS.
 Improved decision support
 the database will provide information useful for decision
making.
 Centralized information control
 Since relevant data in the organization will be stored at one
repository, it can be controlled and managed at the central
level.

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Database System
 Database management system(DBMS) refers to a
software package designed to store and manage
databases.
 Popular DBMS include: MS Access, SQL Server,
Oracle, MySQL, etc.
 Database System
 The DBMS software together with the data itself. Sometimes,
the applications are also included.
 Database system is about
 Organization of data
 Efficient retrieval of data
 Reliable storage of data
 Maintaining consistent data
 Making useful information for decision making

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 Components of DBMS
 Data Base Management system(DBMS) consist of the
following components:
 1. Data Definition Language(DDL)
 language used to define each data element
 2. Data Manipulation Language(DML)
 language used by end-users and programmers to store, retrieve,
and access the data
 e.g. SQL
 3. Data Dictionary(DD)
 tool used to store and organize information about the data

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 Database System Applications
 Database Applications:-
 Banking: all transactions
 Airlines: reservations, schedules
 Universities: registration, grades
 Sales: customers, products, purchases
 Online retailers: order tracking, customized recommendations
 Manufacturing: production, inventory, orders, supply chain
 Human resources: employee records, salaries, tax deductions
 Databases touch all aspects of our lives

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 Basic Database Terminologies
 A. Enterprise
 an organization : A library, a bank, a university, etc.
 B. Entity
 Person, place, thing, or event (property of an entity)
 An "object" in the real world that we are interested in
 The object student is an entity
 C. Attribute (Field)
 A character or group of characters (alphabetic or numeric), that has a
specific meaning. Eg. Name, age, telephone, grade, sex, etc.
 D. Record
 A logically connected set of one or more Attributes that describe a
person, place or thing. (Logically related data)
 E. File
 A collection of related records. For example, a file might contain data
about customers; or students of a certain department in a university.
 F. Database
 A logical grouping of related files.

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Overview of Database Design Process
 Database design consists of several tasks:
 requirements collection and analysis: to understand and
document users data requirements.
 Information is gathered…
 by interviewing end users
 examining business forms
 examining business reports
 By observation
 Conceptual design
 Is a concise description of the data requirements of the users
 Includes detailed descriptions of the entity types, relationships,
and constraints;
 Can be used to communicate with nontechnical users
 Do not include implementation details
 Enables the designer to concentrate on specifying the properties of
the data, without being concerned with how

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Overview of Database Design
Process(cont’d)
 Logical design or data model mapping
 The process of constructing a model of the information used in an
enterprise based on a specific data model (e.g. relational), but
independent of a particular DBMS and other physical
considerations.
 physical design
 Internal storage structures, file organizations, indexes, access
paths, and physical design parameters for the database files are
specified

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 Database Model
 A database model is a type of data model that
determines the logical structure of a database and
fundamentally determines in which manner data can
be stored, organized, and manipulated.
 The most popular example of a database model is
the relational model, which uses a table-based format.
 Common logical data models for databases include:
 Hierarchical database model
 Network model
 Entity–relationship model
 Relational model
 Object Oriented model

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 Managing Data Resources
 To make sure that the data for your business remain
accurate, reliable, and readily available to those who
need it, your business will need special policies and
procedures for data management
 Establishing an information policy
 specifies the organization’s rules for sharing, disseminating,
acquiring, standardizing, classifying, and inventorying information.
 which users and organizational units can share information, where
information can be distributed, and who is responsible for updating
and maintaining the information.
Example: only human resource department would have the right to
change employee’s salary.

 Ensuring data quality

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 Who Manages Data?
 Managed assets - finance, personnel, equipment,
and facilities. Today, data must be added to this list of
managed assets
 Who manages data?
 A. Business manager - manages organizational data
 B. Database administrator - provides overall organizational
leadership in the data management function
 C. Chief knowledge officer(for some organizations) -
knowledge management functions.

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 Data Warehouses, Data Marts, and
Data Centers
 A data warehouse is a subject-oriented(such as customer, product,
sales), integrated(multiple, heterogeneous data sources), time-
variant, and nonvolatile(a physically separate store of data
transformed from the operational environment) collection of data in
support of management’s decision-making process.—W. H. Inmon
 Is a database that is maintained separately from the organization’s
operational database for the purpose of decision support.
 It is a repository of multiple heterogeneous data sources organized
under a unified schema at a single site in order to facilitate
management decision making

 Data warehousing:
 The process of constructing and using data warehouses

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 Data warehouse
 Data warehousing is most appropriate when
 Large amount of data to be accessed
 The operational data is stored in different systems
 Large number of users (AT&T)
 Extensive end-user computing

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 Data marts
 A data mart is a small warehouse designed for a
department
 Contains a subset of the organization-wide data that is
of value to a small group of users, e.g., marketing or
customer service.

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 Data Center
 An organizational unit that uses centralized computing
resources to perform information processing activities
for an organization. Also known as a computer
center.

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