Africa Nazarene University
Management Information Systems (MIS 402)
Lecture 1: Introduction to Information Systems
Lecturer: Raphael Wanjiku
May 2015 Trimester

Define MIS
 Study of information systems in business and management.
 Refers to an information system developed and used by an organization to collect,
process and disseminate data and/or information using on a computer program.
 MIS deals with the behavioral issues as well as technical issues surrounding the
development, use and impact of information systems used by managers and
employees in the firm.
 The system is made up of hardware, software, people, communication facilities
and data.
Insights
1. Why do firms spend so much to integrate their business operations with computing
technologies?
 $500+ billion in 2010 by American companies.
 20% growth in capital investment between 1980 and 2009 by private
companies.
2. Examples of 1?
3. Examples of how Information systems are transforming business:
 People with mobile devices in the world.
 People with access to the internet in the world.
 Companies with websites globally.
 Shoppers online
 Access to news
 Businesses using social media to reach clients
 Laws requiring backup of data
Information vs. Data
 Data refers to the unprocessed details that are composed of raw facts
representing events occurring in an organization or in the environment
surrounding it, but cluttered to be the basis of good decision making process.
 Information refers to the processed data shaped into a form that is meaningful

and useful to human beings.
The digital Firm
 One in which nearly all of the organization’s significant business relationships
with customers, suppliers and employees are digitally enabled and mediated.
 Key business processes are accomplished through digital networks spanning the
entire organization or linking multiple organizations.
 A business process refers to a set of logically related tasks and behaviors that
organizations develop over time to produce specific business results and the
unique manner in which the activities are organized and coordinated.
Examples of business processes:
 Hiring an employee
 Developing a new product
 Generating and fulfilling an order
 Digital firms sense and respond to their environments far more rapidly than
traditional firms which gives them more flexibility to survive during tough times.
 In digital firms, both time shifting (business conducted continuously) and space
shifting (as long best work is done globally) are the norm.
 Digital firms have an aspect of replacing face-to-face meetings.
Firms invest in information systems to achieve the following strategic business
objectives:
a) Operational excellence
To improve efficiency of operations in order to achieve higher profitability. This
should be coupled by changes in business practices and behavior management.
b) New products, services and business models
A business model describes how a company produces, delivers and sells a
product or service to create wealth.
c) Customer and supplier intimacy
Great customer service increases profitability and revenues by customers

returning and purchasing more.
Companies asked questions of customers satisfaction-ever seen this on hotel
websites?
d) Improved decision making
There is so much information and managers have to rely on forecasts, guesses
and luck which result to over or underproduction of goods and services,
misallocation of resources and poor response times. These lead to increased
costs and lose customers.
e) Competitive advantage
Competitive advantage can result from the above four mentioned strategies and
doing things better than competitor, charging less for superior products,
responding to customers and suppliers will add a high notched distinction in the
market.
f) Survival
Investment in information systems could be a necessity for the firms which could
be driven by the industry-level changes.
Overview of Information Systems
Information Technology
 Consists of all hardware and software that a firm needs to use in order to achieve
its business objectives.
Information System
 A set of interrelated components that collect, process, store, and distribute
information to support decision making and control in an organization.
 They also help managers and workers analyze problems, visualize complex
subjects, and create new products.
For an information system to deliver information useful for decision making, the dat
undergoes through several activities:
Input –captures or collects data from the organization or its environment.
Processing –conversion of the data/raw input into a meaningful form
Output – transfer the processed information to the people or activities which need the

information for decision making.
Feedback – output returned to the people in the organization for reevaluation or
correction in the input stage.
Dimensions of Information Systems
 Information systems literacy- refers to the broader understanding of information
systems and understanding of management, organization and technical systems
dimensions. It is important in order to be in position of power to provide
solutions to challenges and problems in the business environment.
There are three dimensions of information systems:
a) Organization
 Information systems are integral part of an organization. Some companies
cannot exist without them.
 The key elements of an organization are: people, structure, business
processes, politics and culture.
 The organization structure is composed of different levels and specialties.
These levels reveal different divisions of labor.
 Responsibilities and authority are normally hierarchical with upper levels
consisting of managerial, professional and technical employees, whereas
the lower levels consist of operational personnel.
 Senior management-
 Middle management-
 Operational management-
 Knowledge workers-
 Data workers-
 Production or service workers-
The major business functions of an organizations are:

 The organization coordinates work through the hierarchy and through its
business processes which are performed following formal rules that have
been developed over a long period for accomplishing tasks.
 Each organization has its own culture. A culture is a set of fundamental
set of assumptions, values and ways of doing things, which have been
accepted by most of its members.
 Different levels and specialties in an organization create different interests
and points of view which form conflicts which acts as a basis for
organizational politics.
b) Management
 Management’s job is to make sense out of many situations faced by
organization, make decisions and formulate action plans to solve
organization’s problems.
 Managers perceive business challenges in the environment; they set the
organizational strategy for responding to those challenges; and they
allocate the human and financial resources to coordinate the work and
achieve success.
 Managers also create new products and services and even recreate the
organization from time to time.
c) Information Technology
This is an infrastructure composed of:
 Computer hardware-physical equipment used for input, processing and
output.
 Computer software-consists of detailed, preprogrammed instructions that

coordinate and control the hardware.
 Data management technology-consists of software governing the data
organization on physical storage media.
 Networking and telecommunications technology-consists of both physical
devices and software, links to various hardware and transfers of data from
one physical location to another.
The IT infrastructure provides the foundation or platform on which the firm can
build its specific information systems so that it has it’s the set of services
necessary to accomplish the business need.
Assignment 1:
a) Page 23—UPS case study
b) Discuss various roles of information systems in the business value chain.
Note:
 Some firms invest great deal in information systems and receive great deal in

returns, others invest little and receive great deal while others invest a lot and
receive little returns. This is due to the concept of complementary assets (assets
required to derive value from a primary asset-e.g. a highway for the automobiles):
investments in IT alone cannot be make the great returns a reality, but must be
accompanied by supportive values, structures and behavior patterns in the
organization.
 Some firms fail to adopt the right business model that suits the new technology
or seek to preserve an old business model that is doomed by technology. E.g.
Apple music and music label companies.
 The value of investments in IT depends on the complementary investments in
management and organization.
Approaches to Information Systems
 IS can be divided into technical and behavioral approaches. In fact, IS are
sociotechnical systems formed on many disciplines. Though they are composed
of machines and the physical technology, they require social, organizational and
intellectual investments to make them work properly.

Technical Approach
 Emphasizes the mathematically based models to study IS as well as the physical
technology and formal capabilities for these systems.
 Disciplines contributing include:
 Computer science for computational theories
 Management science for decision making and management practices
 Operations research for mathematical techniques.
Behavioral Approach
 Some issues such as design, strategic business integration, implementation,
utilization and management of IS arise in the development and long term
maintenance and they go beyond the technical models spectrum.
 Disciplines contributing include:
 Sociology for studying how individuals, groups and organizations shape IS
development.
 Psychology for human decision making and perception to use of formal
information.

 Economics for understanding production of digital goods, dynamics of digital
markets and how IS change the control and cost structures in the firm.
Review Questions
Page 33