K204 Chapters 3, 5, & 7

Data

Raw, unorganized facts such as numbers, words, or symbols that have no meaning on their own.

Information

Data that has been organized, processed, or structured to give it meaning and usefulness.

Knowledge

Information combined with experience, context, and judgment to draw conclusions or make decisions.

Information system (IS)

A set of interrelated components that collect, process, store, and distribute information.

Components of an information system

People, processes, procedures, data, and technology.

Sociotechnical system

A system that combines people, processes, and technology working toward a common goal.

Alignment in a sociotechnical system

Organizations perform best when the human and technical sides of a system are aligned.

People in an information system

The users, managers, developers, and decision-makers who use the system.

Processes and procedures

The rules, workflows, and routines that guide how people complete work within an information system.

Data versus information

Data consists of raw facts, such as sales numbers, customer names, and inventory counts. Information is data organized and given meaning.

Technology in an information system

Hardware, software, and networks.

Hardware examples

Computers, servers, and mobile devices.

Software examples

Applications, databases, and operating systems.

Network examples

The internet, intranets, and wireless connections.

Can an information system succeed through technology alone?

No. Successful design, implementation, and management must also consider people, processes, procedures, and data.

Structured data

Data organized into consistent fields and defined records that follow established types, relationships, or rules.

Why organizations use information systems

To operate more efficiently, make better decisions, and achieve their goals.

Transaction processing system (TPS)

An operational information system that supports routine business activities such as sales, purchases, payments, payroll, and inventory updates.

Management information system (MIS)

An information system that provides routine reports and summaries to help managers monitor operations and make informed decisions.

Decision support system (DSS)

An information system that analyzes data and scenarios to help users solve problems and make informed business decisions.

Executive information system (EIS)

An information system that gives executives easy access to high-level summaries, dashboards, key performance indicators (KPIs), and strategic information.

Business process

A series of related activities performed to achieve a specific business goal or desired outcome.

Enterprise resource planning (ERP)

An integrated information system that manages and connects core business processes through a shared database and a unified platform.

Business functions connected by ERP

Accounting, finance, human resources, operations, and supply chain management.

Porter's Five Forces

Bargaining power of buyers, bargaining power of suppliers, competitor rivalry, threat of substitutes, and threat of new entrants.

When is buyer bargaining power high?

When customers have many alternatives, can switch easily, buy in large volumes, or can pressure a company to lower prices or improve terms.

When is supplier bargaining power high?

When few suppliers provide an important input, switching suppliers is costly, or a company depends heavily on a supplier.

When is competitor rivalry high?

When many competitors pursue the same customers, industry growth is slow, offerings are difficult to distinguish, or price competition is intense.

When is the threat of substitutes high?

When customers can meet the same need through a different product or service, especially one with an attractive price or performance.

When is the threat of new entrants high?

When new competitors can enter the market without major barriers.

Barriers to entry

Capital requirements, regulations, technology, distribution, and customer loyalty.

Cost leadership strategy

Serving a broad market while operating at a lower cost than competitors, allowing lower prices or stronger profit margins.

How can information systems support cost leadership?

Efficient supply chains, standardized processes, and automation can lower costs.

Differentiation strategy

Serving a broad market with something unique or valuable that customers may pay more for.

Sources of differentiation

Product quality, features, service, convenience, and brand reputation.

Cost focus strategy

Targeting a specific market segment and competing by keeping costs low. A narrow focus can simplify operations and allow lower prices.

Cost focus examples

Focusing on customers in one region or one industry.

Differentiation focus strategy

Targeting a specific market segment with a specialized product or service closely designed around its needs; customers may pay more for it.

Four sources of competitive advantage listed in the notes

Switching costs, network effects, data as an asset, and first-mover advantage.

Systems development life cycle (SDLC)

A structured way to move from a business problem to a working, supported system.

Six SDLC stages

1. Planning, analysis, and requirements; 2. Designing; 3. Developing; 4. Testing; 5. Deploying; 6. Maintaining.

Five questions for understanding a business problem

Who is affected? What is the problem? Where does it occur? When does it occur? Why does it occur?

Formal lens for project tradeoffs

Scope, cost, and time; used for planning budgets, schedules, and fit.

Technology lens for project tradeoffs

Quality, cost, and speed; useful for evaluating prototypes and risk.

Business requirement

A clear statement of what a system must accomplish or support so the organization can achieve a business purpose; often begins with "The system must…"

Characteristics of a good requirement

Specific, stakeholder-aware, information-focused, testable, and concise.

When to buy an existing software product

When the business process is common and fits the existing product well.

When to configure or customize a vendor system

When a vendor system mostly fits the organization's needs but the organization needs its own rules, roles, fields, or reports.

When to build custom software

When the capability is unique, strategic, or tightly integrated. Building offers more control but requires more work and support.

Waterfall

A linear development approach in which major stages are completed in sequence, often with formal documentation, approvals, and handoffs.

Agile

A development approach that works in smaller increments, gathers feedback often, and adapts as the team learns.

Scrum

A common Agile framework that organizes work into short cycles with regular planning, review, and feedback.

DevOps

An approach that connects development, deployment, operations, monitoring, and support to release and improve systems more reliably.

Vibe coding

Creating software primarily by describing what to build in natural language and letting AI generate much of the code.

System requirement

A clear, testable statement of what a system must do, support, capture, enforce, or prevent to meet a business need.

Normal scenario

A typical situation showing how a user completes a task when the process works as expected.

Edge case

An unusual but possible situation that tests what a system should do when the normal process breaks, conflicts, or reaches a limit.

Acceptance test

A specific check used to confirm whether a requirement has been met under defined conditions.

Given-When-Then

Given: the starting condition. When: the action or event. Then: the expected result.

Deployment

Moving a tested system into use.

Adoption

The system being used for real work; this is where return on investment (ROI) becomes real.

Post-launch monitoring signals

Evidence managers watch after launch to see whether a system works in real use.

Examples of post-launch monitoring signals

Error rates, support tickets, incomplete transactions, approval delays, and failed integrations.

Enterprise software

Large-scale software designed to support and integrate core business processes across an entire organization, including multiple departments and locations.

Enterprise system

Organization-wide software that coordinates information and processes across business functions such as finance, sales, human resources, and operations.

Customer relationship management (CRM)

Software that helps an organization manage interactions and relationships with current and potential customers.

Supply chain management (SCM)

Coordinates the flow of products, information, and money from raw material sourcing to the final customer.

Systems map

Shows which systems participate in a business event, the order of their involvement, and the information that moves between them.

What does a systems map connect?

Software applications, databases, and user workflows that work together to achieve a specific business goal.

Flowchart versus systems map

A flowchart shows the steps a person follows to complete a process. A systems map shows where data goes and which systems are involved.

Data silos

Situations in which data is trapped in one system and cannot easily flow to another, creating disconnected and incompatible environments.

Problems associated with disconnected systems

Data inconsistency and errors; wasted time and manual data entry; inability to see the bigger picture; poor customer experience; high IT and maintenance costs; compliance and audit risks; resistance to change.