ImplementingInformation Systems

Ir. Fajar Sasongko, MM., M.Kom

• Database System

• Networks, Intranet, Extranet, and Internet

• Electronic Commerce

• Enterprise Resource Planning

• Information and Decision Support System

DatabaseSystem

Introduction

• Database management system (DBMS): group ofprograms that manipulate database and provide interfacebetween database and users

• Database administrator (DBA): a skilled informationsystems professional who directs all activities related toorganization’s database

Figure 3.1: The Hierarchy of Data

Example

Data Entities, Attributes, and Keys

• Entity: a generalized class of people, places, or things(objects) for which data is collected, stored, andmaintained

• Attribute: a characteristic of an entity

• Data item: the specific value of an attribute

• Key: a field or set of fields in a record that is used toidentify the record

• Primary key: a field or set of fields that uniquelyidentifies the record

Figure 3.2: Keys and Attributes

Relationship

• In addition to the attribute values of the entities (records)that belong to those entity types, we are interested inrelationships among the entities (records).

• A relationship type R among n entity types E1, E2, … En isa set of associations among entities (records) from thesetypes.

• Each of the entity types E1, E2,… En is said to participatein the relationship type R, and similarly each of theindividual entities e1, e2, … en is said to participate in therelationship instance.

The Entity-Relationship (ER) Diagrams

EMPLOYEEEntity Type(Entity Set)

Name of Entity Type

EMPLOYEEDEPARTMENTHIRES

Relationship Type

Name of Relationship Type

BELONGS TO

Figure 3.3: The Traditional Approach toData Management

Figure 3.4: The Database Approach toData Management

Popular Database ManagementSystems

• Popular DBMSs for end users include Microsoft’s Accessand Corel’s Paradox

• The complete database management software marketincludes databases by IBM, Oracle, and Microsoft

• Examples of open-source database systems: PostgreSQLand MySQL

• Many traditional database programs are now available onopen-source operating systems

Selecting a Database ManagementSystem

• Important characteristics of databases to consider:

• Size of the database

• Number of concurrent users

• Performance

• The ability of the DBMS to be integrated with othersystems

Selecting a Database ManagementSystem (continued)

• Important characteristics of databases to consider(continued):

• Features of the DBMS

• Vendor considerations

• Cost of the system

Networks, Intranet,Extranet, and Internet

Networks

• Network

• Used to connect computers and computer equipment in abuilding, around the country, across the world, to enableelectronic communications

• A group of two or more computer systems linked together

Types of Network

There are many types of computer networks, including:

local-area networks (LANs) : The computers are

geographically close together (that is, in the samebuilding).

wide-area networks (WANs) : The computers arefarther apart and are connected by telephone lines orradio waves.

Network Topology

Intranets and Extranets

• Intranet

• Internal corporate network built using Internet and WorldWide Web standards and products

• Reduces the need for paper

• Provides employees with an easy and intuitive approach toaccess information that was previously difficult to obtain

Intranets and Extranets (continued)

• Extranet: a network based on Web technologies that links selectedresources of a company’s intranet with its customers, suppliers, orother business partners

• Extranet configurations

• One company sets up a Extranet for its dealers, customers, or suppliers

• Companies within an industry set up a collaborative Extranet formutual benefit

• Several companies collaborate over an Extranet for joint venture

• Benefits include –

• Lower communication costs; better communication; improved orderentry and customer service; improvement in business effectivenes

ElectronicCommerce

An Introduction to ElectronicCommerce

• Business-to-consumer (B2C) e-commerce: customersdeal directly with the organization, avoiding anyintermediaries

• Business-to-business (B2B) e-commerce: participantsare organizations

• Consumer-to-consumer (C2C) e-commerce:participants are individuals, with one serving as the buyerand the other as the seller

Multistage Model for E-commerce

• Search and identification

• Selection and negotiation

• Purchasing products and services electronically

• Product and service delivery

• After-sales service

Figure 3.6: Multistage Model for E-Commerce (B2B and B2C)

Figure 3.7: Three Basic Components ofa Successful E-Commerce Model

Figure 3.8: Supply Chain Management

Business-to-Business (B2B) E-Commerce

• Allows manufacturers to buy at a low cost worldwide

• Enterprises can sell to a global market

• Offers great promise for developing countries

Business-to-Consumer (B2C) E-Commerce

• Convenience

• Many goods and services are cheaper when purchased viathe Web

• Comparison shopping

• Disintermediation: elimination of intermediateorganizations between the producer and the consumer

Consumer-to-Consumer (C2C) E-Commerce

• Often done through Web auction sites such as eBay

• Growth of C2C is responsible for reducing the use of theclassified pages of newspapers to advertise and sellpersonal items

Mobile Commerce

• Mobile commerce (m-commerce) relies on the use ofwireless devices, such as personal digital assistants, cellphones, and smart phones, to place orders and conductbusiness

• Issues confronting m-commerce

• User-friendliness of the wireless device

• Network speed

• Security

Technology Needed for MobileCommerce

• Handheld devices used for m-commerce have limitationsthat complicate their use

• Wireless application protocol (WAP): a standard set ofspecifications for Internet applications that run onhandheld, wireless devices

Figure 3.9: Electronic Shopping Cart

Threats to E-Commerce

• E- and m-commerce incidents

• Theft of intellectual property

• Intellectual property: music, books, inventions, paintings,and other special items protected by patents, copyrights, ortrademarks

• Patents on business processes

Enterprise ResourcePlanning

Enterprise Resource Planning: AnOverview

• Enterprise resource planning (ERP) systems are used inlarge, midsized, and small companies

• Real-time monitoring of business functions

• Timely analysis of key issues such as quality, availability,customer satisfaction, performance, and profitability

An Overview of Enterprise ResourcePlanning (continued)

• Steps in running a manufacturing organization using anERP system

• Develop demand forecast

• Deduct demand forecast from inventory

• Determine what is needed for production

• Check inventory for needed raw materials

An Overview of Enterprise ResourcePlanning (continued)

• Steps in running a manufacturing organization using anERP system (continued)

• Schedule production

• Assess need for additional production resources

• Financial forecasting

Advantages and Disadvantages of ERP

• Elimination of costly, inflexible legacy systems

• Improvement of work processes

• Increase in access to data for operational decision making

• Upgrade of technology infrastructure

• Expense and time in implementation

Advantages and Disadvantages of ERP(continued)

• Difficulty implementing change

• Difficulty integrating with other systems

• Risks in using one vendor

• Risk of implementation failure

Information and DecisionSupport System

IS Strategy

THREE DOMAINS

Information SystemRequirements

Information TechnologySupply

Information ManagementStrategy

STRATEGIC PLANNING

List of Scenarios

Risk Management

Cost/Benefit Analysis

Technical Design

Project Management

Priorities Level and Schedule

Implementation Plan

Human Resource Skills andCompetenciesRequirements

Change Management

INTERNAL

Corporate History

Business Plan

Existing InformationTechnology

Constraints and Opportunities

Strength and Weakness

Approach and Methodology

EXTERNAL

Industry Trend

Information TechnologyDevelopment

Competitor Analysis

Benchmarking

Best Practice

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BUSINESSPROCESS

PROCEDURES

STANDARD

PEOPLE

CULTURE

POLICIES

LEGALASPECT

TECHNOLOGYINFRASTRUCTURE

COMPANYASSETS

FINANCIALRESOURCES

ORGANIZATIONSTRUCTURE

COMPANYGEOGRAPHICAL

TOPOLOGY

BLUE PRINTINPUT

VALUE

VISIONMISSION

CSFsKPIs

STRATEGY

Ideology, Political Agenda, Economic Environment, Socialand Culture, International Relationship, National

Defense, Religion, Behaviors,

Macro Environment

ANALYSIS PROCESS

THREE DOMAINS

Information SystemRequirements

Information TechnologySupply

Information ManagementStrategy

STRATEGIC PLANNING

List of Scenarios

Risk Management

Cost/Benefit Analysis

Technical Design

Project Management

Priorities Level and Schedule

Implementation Plan

Human Resource Skills andCompetenciesRequirements

Change Management

INTERNAL

Corporate History

Business Plan

Existing InformationTechnology

Constraints and Opportunities

Strength and Weakness

Approach and Methodology

EXTERNAL

Industry Trend

Information TechnologyDevelopment

Competitor Analysis

Benchmarking

Best Practice

S

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HO

LD

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S

S

HA

RE

HO

LD

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S

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W

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BUSINESSPROCESS

PROCEDURES

STANDARD

PEOPLE

CULTURE

POLICIES

LEGALASPECT

TECHNOLOGYINFRASTRUCTURE

COMPANYASSETS

FINANCIALRESOURCES

ORGANIZATIONSTRUCTURE

COMPANYGEOGRAPHICAL

TOPOLOGY

BLUE PRINTINPUT

VALUE

VISIONMISSION

CSFsKPIs

STRATEGY

Ideology, Political Agenda, Economic Environment, Socialand Culture, International Relationship, National

Defense, Religion, Behaviors,

Macro Environment

ANALYSIS PROCESS

Character of Information

UnstructuredUnstructured StructuredStructured HighlyStructured

HighlyStructured

UnconstrainedUnconstrained ConstrainedConstrained HighlyConstrained

HighlyConstrained

FutureFuture Future andHistorical

Future andHistorical HistoricalHistorical

LongYears

LongYears

Medium,Weeks/Months

Medium,Weeks/Months

Short,Days/Hours

Short,Days/Hours

InfrequentInfrequent FrequentFrequent VeryFrequent

VeryFrequent

ExternalExternal Internal andExternal

Internal andExternal InternalInternal

TOPMANAGER

LOWERMANAGER

MIDDLEMANAGER

InformationSources

Frequencyof use

TimeScale

TimeHorizon

Scope

Nature ofDecision UnstructuredUnstructured StructuredStructured Highly

Structured

HighlyStructured

UnconstrainedUnconstrained ConstrainedConstrained HighlyConstrained

HighlyConstrained

FutureFuture Future andHistorical

Future andHistorical HistoricalHistorical

LongYears

LongYears

Medium,Weeks/Months

Medium,Weeks/Months

Short,Days/Hours

Short,Days/Hours

InfrequentInfrequent FrequentFrequent VeryFrequent

VeryFrequent

ExternalExternal Internal andExternal

Internal andExternal InternalInternal

TOPMANAGER

LOWERMANAGER

MIDDLEMANAGER

InformationSources

Frequencyof use

TimeScale

TimeHorizon

Scope

Nature ofDecision

Macro and Micro Assessment

Structure

BUSINESS INFORMATION SYSTEM

INTERNAL

EXTERNAL

Process

Resources

People

Infrastructure

Hardware

Software

Applications

Market

Customers

Government

Competitors

R&D

Silicon Valley

Science

Technology

Structure

BUSINESS INFORMATION SYSTEM

INTERNAL

EXTERNAL

Process

Resources

People

Infrastructure

Hardware

Software

Applications

Market

Customers

Government

Competitors

R&D

Silicon Valley

Science

Technology

Decision Making and Problem Solving:Decision Making as a Component of

Problem Solving

• Decision-making phase: first part of problem-solvingprocess

• Intelligence stage: potential problems or opportunities areidentified and defined

• Design stage: alternative solutions to the problem aredeveloped

• Choice stage: requires selecting a course of action

Figure 3.10: How Decision MakingRelates to Problem Solving

Decision Making as a Component ofProblem Solving (continued)

• Problem solving: a process that goes beyond decisionmaking to include the implementation stage

• Implementation stage: a solution is put into effect

• Monitoring stage: decision makers evaluate theimplementation

An Overview of ManagementInformation Systems: ManagementInformation Systems in Perspective

• A management information system (MIS) providesmanagers with information that supports effectivedecision making and provides feedback on dailyoperations

• The use of MISs spans all levels of management

Figure 3.11: Sources of ManagerialInformation

Inputs to a Management InformationSystem

• Internal data sources (TPSs and ERP systems and relateddatabases; data warehouses and data marts; specificfunctional areas throughout the firm)

• External data sources (Customers, suppliers, competitors,and stockholders whose data is not already captured bythe TPS; the Internet; extranets)

Outputs of a Management InformationSystem

• Scheduled report: produced periodically, or on aschedule

• Key-indicator report: summary of the previous day’scritical activities

• Demand report: developed to give certain information atsomeone’s request

• Exception report: automatically produced when asituation is unusual or requires management action

• Drill-down reports: provide increasingly detailed dataabout a situation

Characteristics of a ManagementInformation System

• Fixed format, standard reports

• Hard-copy and soft-copy reports

• Uses internal data

• User-developed reports

• Users must request formal reports from IS department

Functional Aspects of the MIS

• Most organizations are structured along functional linesor areas

• MIS can be divided along functional lines to producereports tailored to individual functions

Figure 3.12: MIS is an integrated collectionof functional information systems

Financial Management InformationSystems

• Financial MIS: provides financial information to allfinancial managers within an organization

• Profit/loss and cost systems

• Auditing

• Uses and management of funds

Figure 3.13: Overview of a FinancialMIS

Manufacturing ManagementInformation Systems

• The manufacturing MIS subsystems and outputs monitorand control the flow of materials, products, and servicesthrough the organization

• Design and engineering

• Master production scheduling and inventory control

• Process control

• Quality control and testing

Figure 3.14: Overview of aManufacturing MIS

Marketing Management InformationSystems

• Marketing MIS: supports managerial activities inproduct development, distribution, pricing decisions, andpromotional effectiveness

• Marketing research

• Product development

• Promotion and advertising

• Product pricing

Figure 10.8: Overview of a MarketingMIS

Human Resource ManagementInformation Systems

• Human resource MIS: concerned with activities relatedto employees and potential employees of an organization

• Human resource planning

• Personnel selection and recruiting

Human Resource ManagementInformation Systems (continued)

• Training and skills inventory

• Scheduling and job placement

• Wage and salary administration

• Outplacement

Figure 3.15: Overview of a HumanResource MIS

Other Management InformationSystems

• Accounting MIS: provides aggregate information onaccounts payable, accounts receivable, payroll, and manyother applications

• Geographic information system (GIS): capable ofassembling, storing, manipulating, and displayinggeographic information

An Overview Of Decision SupportSystems

• A DSS is an organized collection of people, procedures,software, databases, and devices used to support problem-specific decision making and problem solving

• The focus of a DSS is on decision-making effectivenesswhen faced with unstructured or semistructured businessproblems

Characteristics of Decision SupportSystems

• Handle large amounts of data from different sources

• Provide report and presentation flexibility

• Offer both textual and graphical orientation

• Support drill-down analysis

Capabilities of a Decision SupportSystem

• Support all problem-solving phases

• Support different decision frequencies

• Support different problem structures

• Support various decision-making levels

Figure 3.16: Decision-Making Level

Table 3.17: Comparison of DSSs andMISs

Table 3.17: Comparison of DSSs andMISs (continued)

Components of a Decision SupportSystem

• Model base: provides decision makers access to a varietyof models and assists them in decision making

• Database

• External database access

• Access to the Internet and corporate intranet, networks,and other computer systems

• Dialogue manager: allows decision makers to easilyaccess and manipulate the DSS and to use commonbusiness terms and phrases

Figure 3.18: Conceptual Model of aDSS