5.9 management information systems

data analytics

• transforming raw data into useful info → patterns, correlations, trends, insights

  • gives competitive adv

  • helps in decision-making: less risk

• types

  • descriptive: past business performance

  • diagnostic: reasons for past performance

  • predictive: forecast future performance

  • prescriptive: recommended actions

database

• structure for stored data

• electronic databases allow for fast data input, storage, protection and retrieval

• setting up and maintaining is costly

  • security costs

  • hiring database managers → ensure database is fit for purpose

cybersecurity

• systems used to protect computer networks from theft/unauthorised access of data

• methods

  • employee training and awareness

  • regular security audits and access control: testing, reviewing user access, staying informed of threats

  • strong password and encryption policies

  • backup and recovery: regular back ups of critical data, data restoration procedures, contingency plans

cybercrime

• illegal activity related to the use of computer or network devices

• forms

  • phishing: tricking individuals or businesses into sensitive info by posing as a trustworthy organisation

  • ransomware: viruses, worms, trojans, spyware → disrupt, damage or gain unauthorised access

  • ransomware: malware that encrypts users files, demands a fee to be paid for their release

  • identity theft: stealing personal info to commit fraud

  • email/internet fraud: schemes distributed via online communications, meant to deceive individuals for financial gain

  • intellectual property theft: theft, unauthorised use or piracy of copyrighted content

  • account hijacks: distributed denial of service (ddos) → overwhelm website with traffic, cause it to become slow/unavailable

critical infrastructure

• IT-based systems and facilities that are central to the effective operation of a business

types

• artificial neural networks: computer systems that are inspired by the human brain, used to automate business tasks

  • chatbots to respond to customer inquires

  • monitor machinery, predict when equipment is likely to fail

• data centres: physical spaces that hold important applications and data on behalf of business

  • components: mainframes, servers, routers, firewalls, storage systems

  • provides services: data backup, security, database management/storage, email and file sharing, virtual communications systems

• cloud computing: online space that holds important applications and data on behalf of business

  • remote servers and online networks used to store/share data

virtual reallity

• users explore and interact in a realistic 3D environment created using software

• education and training

  • simulations for practicing real world scenarios without consequences

  • virtual classrooms

• retail

  • virtual shopping

  • product prototyping

  • immersive advertising

• entertainment

  • immersive gaming

  • in theme parks’ rides

the internet of things

• connection of everyday objects to the internet, which allows them to send and receive data

• in an IOT system, tasks are performed with little/no human intervention

• devices used within business to improve efficiency of processes

• devices sold as commercial products

artificial intelligence

• allows machines to complete tasks that normally require human intelligence or reactions

• carry out business functions and improve efficiency

  • HR: filter job applications, shortlists interviewees

  • logistics

  • customer service

  • automatic payment systems incorporate AI to improve financial management

big data

• large volumes of data that businesses handle on a day-to-day basis

• used to understand customers, make strategic decisions, provide personalised services

  • e-commerce: search variables and purchase preferences

  • social media: interactions analysed to identify trends and product popularity/complains

  • IOT: devices automatically collect data

  • logistics: location tracking for transport/delivery

customer loyalty programmes

• gather large amounts of data on spending habits and consumer behaviour from

  • financial transactions

  • interactions: surveys, cctv

  • interactions with online marketing

• in return for allowing access, offer discounts/reward points

• advantages

  • increased customer loyalty since attractive

  • loyal customers recommend business to others → reduces promotional costs

  • avenue for feedback

  • used to differentiate from competitors, increased personalised promotional activity

• disadvantages

  • expensive

  • expect discounts → devalue products

  • disinterested by too many loyalty programmes

  • privacy/data security concerns

digital taylorism

• using technology to monitor workers’ use of the tools/techniques for completing work tasks

  • financial rewards for achieving performance targets

  • sanctions eg disciplinary action if didn’t meet targets

• tech innovations that increase ease of data collection

  • sensors to track location, time, driving etc

  • algorithms and analytics software

  • log keystrokes, record audio/video/time

• adv

  • coordination and control: right no. of employees available when needed + managers quickly identify and act upon poor performance

  • training: identify skill gaps + recorded customer interactions can be used as training workshop materials

  • motivation: data-based feedback improves communications + data identifies high-performing employees for rewards

  • reduces the time that managers need to directly oversee work

data mining

• raw data extracted from large data sets and converted into useful info → used to make data-driven decisions

  • reduce risk

  • increase revenue

  • reduce costs

  • improve customer relations

• areas

  • marketing planning: identify successful strategies + determine market segments

  • sales forecasting: identify sales trends + set budgets

  • consumer profiling: connect purchasing habits with demographic data + target promotions that appeal to specific groups

  • personalised loyalty rewards: target rewards that appeal to specific groups + determine previously successful rewards

  • market research: predict customer preferences

  • identify purchase patterns → adjust product availability

  • R&D: allocate budget

  • production planning: identify supply chain disruptions, prioritise products based on past demand.

• concerns

  • invasion of privacy: large-scale collection and analysis → uncomfortable / violated when info used without explicit consent

  • data breach: storing large amounts of data increases risk of sensitive info being made public

  • discrimination: decision-making based on data may increase social and economic disparities

positive impacts of technology

• large amounts of data can be collected, processed and analysed → informed data-driven decision-making → improved performance

• automation and tools → streamline processes, reduce human error → enhance operational efficiency and productivity + improved customer experience (eg chatbots) + faster delivery times

• software for communication and collaboration → speed up decision-making

• data mining for personalised marketing + monitoring customer feedback for employee training → improve customer experience

• technology provides tools for research and development → adapt to changing market conditions quickly

• IoT → track goods in real-time → increase efficiency of supply chain management

concerns

• security/privacy: data breaches → impact finance/reputation → must follow strict data protection regulations

• ethics: AI and algorithms are biased → discrimination / lack of transparency about how customer data is used → loss of trust

• tech advancements → skill gaps among employees → resistance to change impacts introduction of digital tools

• data used is inaccurate/unreliable → poor decision-making

• dependency: system failures/technical glitches disrupt business operations + businesses that use third-party services/platforms will struggle if service is no longer available

• environmental impact: increased energy consumption + disposal of equipment