Information Technology Reference
In-Depth Information
systems check to make sure that data falls within certain ranges. For number of hours worked,
the range might be from 0 to 100 because it is unlikely that an employee would work more
than 100 hours in a week. The information system would determine that 400 hours is out
of range and provide feedback. The feedback is used to check and correct the input on the
number of hours worked to 40. If undetected, this error would result in a very high net pay
on the printed paycheck!
Feedback is also important for managers and decision makers. For example, a furniture
maker could use a computerized feedback system to link its suppliers and plants. The output
from an information system might indicate that inventory levels for mahogany and oak are
getting low—a potential problem. A manager could use this feedback to decide to order more
wood from a supplier. These new inventory orders then become input to the system. In
addition to this reactive approach, a computer system can also be proactive—predicting
future events to avoid problems. This concept, often called
forecasting
, can be used to esti-
mate future sales and order more inventory before a shortage occurs. Forecasting is also used
to predict the strength and landfall sites of hurricanes, future stock-market values, and who
will win a political election.
forecasting
Predicting future events to avoid
problems.
Manual and Computerized Information Systems
As discussed earlier, an information system can be
manual or computerized. For example, some invest-
ment analysts manually draw charts and trend lines
to assist them in making investment decisions.
Tracking data on stock prices (input) over the last
few months or years, these analysts develop patterns
on graph paper (processing) that help them deter-
mine what stock prices are likely to do in the next few
days or weeks (output). Some investors have made
millions of dollars using manual stock analysis infor-
mation systems. Of course, today many excellent
computerized information systems follow stock in-
dexes and markets and suggest when large blocks of
stocks should be purchased or sold (called
program
trading
) to take advantage of market discrepancies.
Program trading systems help
traders monitor swift changes in
stock prices and make better deci-
sions for their investors.
(Source: Courtesy of REUTERS/
Allen Fredrickson/Landov.)
Computer-Based Information Systems
A
computer-based information system (CBIS)
is a single set of hardware, software, databases,
telecommunications, people, and procedures that are configured to collect, manipulate, store,
and process data into information. A company's payroll, order entry, or inventory-control
system is an example of a CBIS. Lloyd's Insurance in London is starting to use a CBIS to
allows Lloyd's to insure people and property more efficiently and effectively. Lloyd's often
insures the unusual, including actress Betty Grable's legs, Rolling Stone Keith Richards'
hands, and a possible appearance of the Lock Ness Monster (Nessie) in Scotland, which
would result in a large payment for the person first seeing the monster. CBISs can also be
embedded into products. Some new cars and home appliances include computer hardware,
software, databases, and even telecommunications to control their operations and make them
more useful. This is often called embedded, pervasive, or ubiquitous computing.
The components of a CBIS are illustrated in Figure 1.6.
Information technology (IT)
refers
to hardware, software, databases, and telecommunications. A business's
technology infras-
tructure
includes all the hardware, software, databases, telecommunications, people, and
procedures that are configured to collect, manipulate, store, and process data into informa-
tion. The technology infrastructure is a set of shared IS resources that form the foundation
of each computer-based information system.
computer-based information
system (CBIS)
A single set of hardware, software,
databases, telecommunications,
people, and procedures that are
configured to collect, manipulate,
store, and process data into
information.
technology infrastructure
All the hardware, software,
databases, telecommunications,
people, and procedures that are
configured to collect, manipulate,
store, and process data into
information.
