MIS exam 1

What is IS

• collect, store, analyze, and output data and information

data vs information vs knowledge

• data: raw facts, numbers, stats

• information: data given context

• knowledge: application of information

• knowledge > information > data in context

• knowledge < information < data in volume

the six major roles of IS: operations management

• functions to deliver goods/services: inventory/supply chain, accounting, payroll

• compliance: US and other countries it is a part of keeping the business running

• enterprise resource planning: big part of managing operations

the six major roles of IS: customer interactions

• CRM systems, often bundled into ERP systems, build and maintain relationships

• includes web-based front offices and online self-service

• support tickets are a big part of this

• also includes interactions inside a company

the six major roles of IS: making decisions

• data driven decision making: many companies are terrible at this, let what’s actually going on in the business drive high-level decisions

business intelligence

• process managers should use to make decisions, drawn from the company’s own information systems or external factors

  • combines data gathering, data storage, knowledge management, and analysis

  • involves data visualization and data analysis

the six major roles of IS: collaborating on teams

• social networks: used in a business context (facebook marketplace) or also be used to engage customers (Wendy’s X)

• workplace communication software: designed specifically for professional communication; allows for real time integration of multiple information channels

collaborating on teams: software development

• allows for software development/storage/testing/deployment from multiple locations

• Github is by far the biggest platform for this

collaborating on teams: file sharing

• originally used by pirates in the 00’s for sharing music and such illegally with P2P sharing

• companies now have professional platforms to allow their employees to share files with each other

the six major roles of IS: competitive advantage

• valuable: has to deliver real value

• rare: has to be something your competitors don’t have

• inimitable: can’t easily be copied just by studying your business model and reverse engineering

• non-substitutable: can’t get around using your product

the four components of IS

• people: leaders, managers, and staff IT team

• technology: hardware, software, networks

• data: digital data can be integrated and shared across systems

• processes: set of activities to achieve tasks, business process management

the four components of IS: people

• by far the hardest part of dealing with an IS

• people > processes > data > technology

• don’t underestimate the importance of people and processes in an IS, new software is not a silver bullet

information value: timeliness

• is the data real time, or is there a delay?

• if delayed, is the information still valuable?

information value: accuracy

• is the data showing what’s actually going on, or is it distorted

information value: completeness

• is the data complete or fragmented

• if fragmented, is it complete enough to be usable

information value: context

• has the data been given the proper context, or could someone get a wrong idea about what’s really going on

Porter’s 5 competitive forces: threat of new entrants

• many IS companies often do not have a big threat of new entrants compared to other industries

• scale, network effects and switching costs often prevent people from switching software/products

• network effects: product value increases because more people use it

• switching costs: costs that customers incur when they change suppliers

• amount of capital needed to even enter the market is substantial in some instances

Porter’s 5 competitive forces: power of buyers

• depending on the segment of the IS field, buyers may have a little or a lot of power based on their ability to substitute

• because of the concentration of firms, buyers often have few options

• switching costs are higher than average for the IS industry

• IS products are often marketed to the masses, so there are many buyers

• backwards integration is usually not a problem

Porter’s 5 competitive forces: power of suppliers

• IS products tend to have fewer suppliers the higher up you go, the power of their suppliers tends to be very strong at multiple levels

• nothing has been found to replace silicon semiconductors and market segments are seeing further concentration

• chinese firms have been trying to break out of this chain

Porter’s 5 competitive forces: threat of substitution

• IS products tend to have a smaller # of companies in the market and are highly sophisticated, there are not many substitutes due to concentration and sophistication

• high switching costs and very high network effects lower the threat

Porter’s 5 competitive forces: competitive rivalry

• IS companies sometimes use each other’s services

• oftentimes companies will use the services of more than one company

• market shares in many categories have been stable for years

• sometimes there is a degree of cooperation between IS companies

external factors that affect 5 forces: disruptive innovations

• radical and unexpected

• transform industry and change 5 forces

• creative destruction: fail to respond to disruptive innovation that capitalizes on new technologies

• ex: Gen AI

external factors that affect 5 forces: govt. policies

• affect how industries operate and evolve

• ogranizations lobby for govt. action

• judges and courts affect industry structure

• govt. can also make unexpected policy changes

external factors that affect 5 forces: complementary products and services

• industries are interrelated → innovation can require many players in many roles

• visionaires lead to new beneficial directions

• companies embedded in ecosystem

  • core companies: google, apple, microsoft

  • complementary products/services: app store, google play

  • partner: microsoft partnering with LinkedIn

  • govt: establish regulations and standards

• companies nowadays try to build platforms/ecosystems so they can see you a host of complementary goods

• these goods can also come from unrelated manufacturers

external factors that affect 5 forces: environmental events

• major effects without warning (ex: BP oil spill)

• energy costs and emissions (ex: china banned bitcoin mining due to energy cost)

• leaders must consider industry and forces

  • includes accounting for events that may be only a remote possibility

value chain

• primary activities = direct materials + direct labor

  • what are actually needed to make a product (ex: dell buys computer parts, assembles a computer, markets it, and ships it out)

• secondary activities = overhead

  • things you have to do to enable primary activities but aren’t “strictly necessary” for a product (ex: HR and management)

extended value chain

• you have to consider other companies as a part of your value chain

• why? disruption due to policy, new tech, or vertical integration opportunities

  • policy can cause your suppliers/buyers to disappear overnight

  • new tech can allow your buyers to substitute your good/service

  • everyone’s favorite: need to know who supplies you so you can buy them or whose space you want to move into (vertical integration)

IT benchmarking

• IT spending varies by industry and region

• managers can use benchmarks to assess extended value chain

• EVC (extended value chain) model necessary for comparison

benchmarking - run, grow, and transform

• organization just starting → little to none of your budget will be for running

• organization is mature and in decline → more will go towards running

• 74% of IT spending to run organization

• 16% to grow business

• 9% to transform business model

competitive strategies in business: low cost strategy

• competing on price by being the lowest-cost producer in the industry

• you get to offer the lowest prices in order to reach the most people

• many companies start in a low-cost strategy, before transitioning to a different strategy once they have enough market share/recognition

• competition will likely be high, as you will compete with many

competitive strategies in business: product differentiation strategy

• offering unique products/services that stand out from competitors

• cost is still considered, but the ultimate focus is on maximum marginal profit

• brand recognition matters way more

• downside: it’s impossible to reach everybody, because you will turn off some people by how you differentiate yourself

competitive strategies in business: focused niche strategy

• targeting a specific, narrow market segment with tailored offerings

• ideally will serve a market that isn’t being served by anyone else, big focus on who is being served

• ex: GoPro

competitive strategies in business: hybrid strategy

• exactly what it sounds like; just combining the best of multiple types of strategies

• ex: amazon offers competitive prices while providing a vast selection of products

role of IS in strategy

• enhance operational efficiency

  • automate: eliminate low-value tasks → task is repetitive and rule-based; maek the customer experience as fast as possible

  • streamline: enable more/faster high-valued work → reduce complexity of the customer experience in order to drive customer satisfaction; enable employees to make more high-level decisions that matter

ethics

• system of moral principles that human beings use to judge right and wrong and to develop rules of conduct

virtue ethics

• that which makes us a better person is the right thing to do

• influenced natural law

deontology

• we should follow the rules/our duties to determine what’s right

• what we do is more important than the outcomes or meaning behind it

utilitarianism

• actions are ethical or unethical based on their consequences or outcomes

• the needs of the many outweight the needs of the few

• do the most good for the most people

care-based ethics

• we should do what cares for others the most

rights-based ethics

• we should do what preserves fundamental human rights the most

natural law and rights

• certain moral values are universally apparent, inherent in, and applicable to all people and can be discovered using reason

• ex: ten commandments, US declaration of independence

divine command theory

• that which God commands must be right

moral relativism

• morality is relative to the time and place in which someone lives

ethical nihilism

• there is no objective source of morality

ethics and law

• laws are oftened grounded in ethical principles

• political pressure

• legailty vs ethics

  • lying might be legal but, is it ethical

  • actions are “legal” if they do not violate the laws or codes of the local govt., state, or fed

  • actions are “ethical” or “moral” if they meet an individual's personal code of conduct, which may be based on a particular social, religous, or other group norms

amplification of consequences/effect

• web-based technologies can turn minor mistakes into significant issues due to their viral nature

  • ex: a single tweet can reach millions within minutes, amplifying both positive and negative impacts

disinhibition effect

• sometimes your brain doesn’t work the same way online

psychological distance

• when we aren’t at risk of getting punched in the face, we get braver!

• our minds we have more “distance” with people online

intellectual property (IP)

• intangible assets such as music, written works, software, art, designs, movies, creative ideas, discoveries, inventions, and other expressions of the human mind

• fair use (education) is a big exception

copyright, patent, trademark

• copyright: protects authored works for 70 years + author’s life

• patent: protects inventions for 20 years

• trademark: protects marketing materials, potentially indefinitely

digital right management (DRM)

• technologies that software developers, publishers, media companies, and other IP holders use to control access to their digital content

  • applied to movie through cryptographic keys

  • applied to games through software embedded inside

copy left

• preserving one’s copyright or software while using that to ensure free software

• license allows anyone to take, modify, sell, or otherwise use code

• code is made publicly available on the internet

• idea is to try and make software transparent/ethical for all

piracy

• the practice of downloading and / or distributing digital content on the interent

abandonware

• software that is no longer distributed or supported by the copyright user

privacy

• fundamental aspect of human rights and personal freedom

• involves the right to control personal information and how it is used

importance of privacy

• protects individuals from misues of their personal data

• ensurse personal autonomy and freedom from surveillance

impact of tech on privacy

• IT has transformed how personal data is collected, stored, and shared

• digital age has introduced new challenges and ethical considerations for maintaining privacy

cookies

• little files that are stored by your browser that save login details, preferences, and allow companies to track behavior

third party cookies

• those on the website that are not created by the website itself

google analytics

• full service analytics platform which tracks users across multiple websites

facebook pixel

• piece of javascript code that sits on many websites and tracks your movements for analytics

laws/rights to privacy

• right to anonymity

• protection from unwarranted searches or seizures

• right to view and correct personal information

• right to control use of personal information by third parties

• right to be left alone

• protection against intrusion

convenience and discounts

• people often share personal data for convenience or discounts

• ex: allowing cookies for personalized promotions

proxy servers

• act as an intermediary

• pass requests from you and the server back and forth without revealing your IP address or even your country

• VPN (virtual private networks): work similarly, but they also encrypt the traffic between you and the proxy server

pro/con of anonymity online

• pro: protects individuals in online support groups; allows sharing of sensitive information without fear of disclosure

• con: shields terrorists, criminals, spammers, and vengeful posters; online identity can be obscured using fake names, nicknames, free email, and public computers; erasing digital tracks is challenging

surveillance technology

• orgs use tech to monitor email, texting, web surfing, etc.

• pro: addressing concerns like “cyberslacking”; concern from liability; need to protect security and confidentiality

• con: potential drop in productivity; increased stress and lower productivity among monitored employees

information security

• the protection of an organization’s information assets against misues, disclosure, unauthorized access, or destruction

• can arise both inside and outside organizations

• can be natural events or human-made, accidental or deliberate

• insider threat: someone inside a company who compromises the information security of the company they work for, typically from inside the network

• much of the time, it’s phishing attack from outside the company

hacking

• accessing information systems in an unauthorized way, often for nefarious purposes

parasitic computing

• accessing/using the computing power of someone else’s machine without permission

malware

• malicious software designed to attack computer systems

• ex: viruses, worms, trojans, keyloggers

botnets

• networks of compromised computers controlled by criminal gangs

• used to capture sensitive information like user IDs, passwords, and credit cards

distributed denial of service attacks (DDoS)

• zombie computers (usually in a botnet) flood a site wtih quick bogus page requests

• causes the sit to slow down or crash

• impact: financial losses due to downtime, lost business, and damaged reputation

phishing attacks (social engineering)

• mechanism: botnets often mask the source of phishing emails

• recipients are lured to fake websites/login pages to enter personal information

ransomware

• malware that encrypts files and demands a ransom for decryption codes

• payment: often demanded in bitcoins due to their untraceable nature

• impact on healthcare: disrupts access to patient records and critical data

information leaks

• cybercriminals, lost devices, misplaced backup media, and unshredded documents

• legal implications: govt. impose fines on companies that lose customer data

• market impact: oversupply of leaked data drives prices in underground markets

multifactor authentication

• prevents a criminal from accessing your account/network if they only stole a password

patching

• being able to quickly deploy security fixes prevents them from exploitation

backups

• if your system is compromised, being able to wipe it clean and use a back up to restore it is crucial to a quick recovery

principle of least privledge

• every user should only have as much system access as they need at any one time

awareness

• training employees on looking for threats like phishing or ransomware prevents them from becoming a network access point

incident response

• need a cybersecurity team who actively surveys network logs and responds immediately upon detecting an attack

why do we need a formal process of system development

• minimize failure

• avoid creating an intuition-based system

• avoid late, over budget projects

• deliver values as promised

• provide accountability

system development life cycle: planning

• assessing business needs

  • ROI, BEP

  • risk management

  • competitive advantage

• ideally most of your bad projects should fail here

system development life cycle: analysis

• understand business processes/requirements → process diagram/flowchart

• requirement definition (RDD): includes all of the outputs of this step, including the diagram

• want to understand what the process is currently at a more detailed level so you can figure out how the system changes things or fits in

• that is what drives your requirements in the document

• second most common place for your project to fail

functional requirement

• a process the system shoud perform as a part of supporting a user task

• information the system should provide as the user performs a task

• ex: system shall allow users to select the category of their order

non-functional requirement

• characteristics that the system should have that do not directly contribute to the business process

• usability (screen attractiveness), accessibility (accessible for people with disablity), performance (response time), interface (user navigation), security (authentication), compliance, integration, language

system development life cycle: design

• where we specify techincal details to satisfy RDD/PDD like architectural design

• “divide and conquer” is one of the primary strategies used in system/software development in general

• model how users will be using the system

• need to model how the data is used/created/stored including database design

• SDD (solution design document) is first created here

system development life cycle: development

• version control: usually using Git or Gifthub; keeps track of changes made across different software versions

• project and issue tracking: usually integrated with version control; intended to keep track of all bugs and work to be done

• code review: designed to make sure the code being put out by one person is reviewed by someone else to ensure maintainability

system development life cycle: testing

• test small subsytems first, the once those are correct, test their integration at the larger system level

• need to test the new system with any outside systems it integrates with

• ensure performance is acceptable

• have your business user test your system and sign off saying they approve (UAT = user acceptance test)

system development life cycle: implementation

• your software has been tested and found worthy

  • parallel: launch new when old is still running

  • phased: launches modules in phases instead of all at once

  • pilot: launch to a small subset of users or locations first

  • direct: stops old system and launches new on the go-live date

• parallel is usually the best, although phased can make sense with larger systems

• direct can make sense but is more situational (better for smaller systems)

system development life cycle: maintenance

• bug fixes - includes functionality and security

  • can be due to preexisting issues

  • can be due to new issues caused by other systems/software changing

• end of life plan should be considered

• keeping personnel who can maintan the systems is usually the largest challenge

• also the issue of adding new features later, which is sometimes considered a new project depending on the scope

• vibe coding: AI coding with no human experience will produce a maintenance crisis

What goes into buying?

• RFI → RFP → evaluation → contract

• RFP: your requirements from the RDD, timeline expectations, budget parameters, vendor qualification criteria

• total cost of ownership: license/subscription fees, implementation cost, training, integrations, ongoing maintenance

• key contract terms to watch: SLAs, data ownership, exit clauses, price escalation caps

buying: planning phase

• define project scope, objectives, and feasibility

buying: analysis phase

• gather detailed requirements and analyze stakeholder needs

buying: design phase

• determine the technical architecture of the solution needed to fulfill analyzed business needs

buying: development phase

• actual coding and building of the system

buying: testing phase

• test the system to identify and fix defects

buying: implementation phase

• deploy the system to the production environment

waterfall

• strengths

  • requirements are defined long before programming begins. inspired by engineering/construction methodologies

  • requirements changes are limited as the project progresses

• weaknesses

  • must wait a long time before there is evidence of the new system

  • take a long time from start to finish

  • requirements may be overlooked at the beginning and you can’t go back to previous phases

  • assumes build is the right decision

iterating vs incrementing

• incrementing: get a portion done then adding it on to the big project

• iterating: repeating a process, refining through a set of steps to improve something