NETWORKING THE ENTERPRISE

Businesses are becoming networked enterprises.  The Internet and Internet-like networks inside the enterprise (Intranets), between an enterprise and its trading partners (extra-nets), and other types of networks have become the primary information technology infrastructure of many organizations.  Telecommunications networks enable managers, end users, teams, and work groups to electronically exchange data and information anywhere in the world with other end users, customers, suppliers, and business partners.  By using such networks, companies can:

·         Collaborate more creatively

·         Manage their business operations and organizational resources more effectively

·         Compete successfully in today’s fast changing global economy

Many organizations today could not survive without a variety of interconnected computer networks to service their information processing and communications needs.

Analyzing FedEx versus UPS

We can learn a lot about the role that wireless telecommunications technologies can play in e-business.  Take a few minutes to read it, and we will discuss it (See FedEx versus UPS in Section IX).

TRENDS IN TELECOMMUNICATION

Major trends occurring in the field of telecommunications have a significant impact on management decisions in this area.  Informed managerial end users should thus be aware of major trends in telecommunications industries, technologies, and applications that significantly increase the decision alternatives confronting their organizations.

Industry Trends:

·         Telecommunications networks and services are available from numerous large and small telecommunications companies.

·         Explosive growth of the Internet and the World Wide Web has created a host of new telecommunications products, services and providers.

·         Business firms have dramatically increased their use of the Internet and the Web for electronic commerce and collaboration.

Technology Trends:

·         Open systems with unrestricted connectivity, using Internet networking technologies as their technology platform, are becoming the primary telecommunications technology drivers.

·         Increased industry and technical moves towards building client/server networks based on open system architecture.  Open systems are information systems that use common standards for hardware, software, applications, and networking.  Any open systems provide greater connectivity, that is, the ability of network computers and other devices to easily access and communicate with each other and share information.  Open systems architecture also provides a high degree of network interoperability.  That is, open systems enable the many different applications of end users to be accomplished using the different varieties of computer systems, software packages, and databases provided by a variety of interconnected networks.

·         Change from analog to digital network technologies.  Local and global telecommunications networks are rapidly converting to digital transmission technologies that transmit information in the form of discrete pulses, rather than waves.    Digital transmission offers:

a.       Higher transmission speeds (transmits with pulses)

b.    Movement of greater amounts of information

c.       Greater economy

d.      Much lower error rates than analog systems

e.       Telecommunications networks to carry multiple types of communications (data, voice, and video) on the same circuits.  (Integrated Services Digital Network (ISDN) technology)

·         Change in communications media. Many telecommunications networks are changing from copper wire-based media and land-based microwave relay systems to fiber optic lines and communications satellite transmissions.  Fiber optic transmission, which uses pulses of a laser-generated light, offer significant advantages in terms of:

a.       Reduced size and installation effort

b.      Greater communication capacity

c.       Faster transmission speeds

d.      Freedom from electrical interference

Business Application Trends:

·         The trend toward more vendors, services, Internet technologies, and open systems, and the rapid growth of the Internet, the World Wide Web, and corporate Intranets and extra-nets, dramatically increases the number of feasible telecommunications applications.

·         Telecommunications networks are playing a vital and pervasive role in electronic commerce, enterprise collaboration, and internal business applications that support the operations, management, and strategic objectives of both large and small companies.

·         Telecommunications functions have become an integral part of local and global computer networks that are used to dramatically:

a.       Cut costs

b.      Shorten business lead times and response times

c.       Support electronic commerce

d.      Improve the collaboration of workgroups

e.       Develop online operational processes

f.       Share resources

g.      Lock in customers and suppliers

h.      Develop new products and services.

What are the similarities between all operations?

It is mainly devoted to categorizing the types of resources and processes which are found in operations. The intention is to demonstrate these standard categorisations of resources and processes are to be found in any sort of organization. So for example, the table below shows what would constitute the two types of transforming resources (facilities and staff) in three very different types of operation. 

The facilities and staff transforming resources of three operations

	Ferry company	Paper manufacturer	Radio station
Types of facilities	Ships on-board navigation Reeling equipment Dry docks Materials-handling equipment Steam-generating boilers On-shore buildings Computerized reservation systems Warehouses	Pulp-making vats Paper-making machines Slitting equipment Packing machinery Warehouses	Broadcasting equipment Studios and studio equipment Transmitters Outside broadcast vehicles
Types of staff	Sailors Engineers Catering staff On-board shop assistants Cleaners Maintenance staff Ticketing staff	Operators Chemists and chemical engineers Process plant engineers	Disc jockeys Announcers Technicians

Transformed resources in operations are some mixture of materials, information and customers. The important issue here is that, although most types of operation process all three types of transformed resource, one is usually the most important. So, for example, a hospital will process information in the form of patients’ medical records. It will also devote some of its resources to processing materials, for example in the way it produces meals for patients. The main operations task of a hospital, however, is to process customers in a way which satisfies its patients, maximises their health care and minimises its costs. It is predominantly a customer processing operation.

What is Operations Management?

Operations Management deals with the design and management of products, processes, services and supply chains. It considers the acquisition, development, and utilization of resources that firms need to deliver the goods and services their clients want.

The survey of OM ranges from strategic to tactical and operational levels. Representative strategic issues include determining the size and location of manufacturing plants, deciding the structure of service or telecommunications networks, and designing technology supply chains.

Tactical issues include plant layout and structure, project management methods, and equipment selection and replacement. Operational issues include production scheduling and control, inventory management, quality control and inspection, traffic and materials handling, and equipment maintenance policies.

INFORMATION SYSTEM ACTIVITIES

Information processing (or data processing) activities that occur in information system include the following:

·         Input of data resources

·         Processing of data into information

·         Output of information products

·         Storage of data resources

·         Control of system performance

Input of Data Resources:

·         Data about business transactions and other events must be captured and prepared for processing by the input activity.  Input typically takes the form of data entry activities such as recording and editing.

·         Once entered, data may be transferred onto a machine-readable medium such as magnetic disk or type, until needed for processing.

Processing of Data into Information:

·         Data is typically subjected to processing activities such as calculating, comparing, sorting, classifying, and summarizing.   These activities organize, analyze, and manipulate data, thus converting them into information for end users.

·         A continual process of correcting and updating activities must maintain quality of data stored in an information system.

Output of Information Products:

·         Information in various forms is transmitted to end-users and made available to them in the output activity.  The goal of information systems is the production of appropriate information products for end users. 

Storage of Data Resources:

Storage is a basic system component of information systems. 

·         Storage is the information system activity in which data and information are retained in an organized manner for later use.

Control of System Performance:

An important information system activity is the control of its performance.

·         An information system should produce feedback about its input, processing, output, and storage activities.

·         Feedback must be monitored and evaluated to determine if the system is meeting established performance standards.

·         Feedback is used to make adjustments to system activities to correct deficiencies.

RECOGNIZING INFORMATION SYSTEMS

As a business professional, you should be able to recognize the fundamental components of information systems you encounter in the real world.  This means that you should be able to identify:

·         The people, hardware, software, data, and network resources they use.

·         The types of information products they produce.

·         The way they perform input, processing, output, storage, and control activities.

Analysing BellSouth’s Information System

From the Real World Case of BellSouth Corporation, we will try to recognize or visualize the resources used, activities performed, and information products produced by their information systems.

IS Resources:

·         People resources include end users like BellSouth’s online customers and employees, and IS specialists like CIO Fran Dramis and project leader Lori Groves.

Hardware Resources:

·         Thousands of PC server

·         Other computers that BellSouth and its customers must be using

Software Resources:

·         Web browsers

·         Operating systems

·         e-commerce websites software

·         Oracle’s customer relationship management system

·         Other proprietary BellSouth business software.

Network Resources:

·         Communications media and network support components that are part of the network resources that BellSouth would need to support the e-business and e-commerce activities of such a large telecommunications company.

Data Resources:

·         Computer-accessible databases of data about their customers, employees, services, and other necessary business information.

Information Products:

·         Displays on customer and employee networked PCs that provide information about and support the provision of BellSouth’s services, such as you would find by visiting their Websites at www.bellsouth.com and www.bellsouthcorp.com.

IS Activities:

·         Input activities include the input of Web site navigation clicks and e-commerce and e-business data entries and selections, and online collaboration queries and responses made by customers, suppliers, and employees.

Processing Activities:

·         Processing activities are accomplished whenever any of BellSouth’s computers executes the programs that are part of their e-business and e-commerce software resources. 

Output Activities:

·         Output activities primarily involve the display or printing of information products mentioned earlier.

Storage Activities:

·         Storage activities take place whenever business data is stored and managed in the files and databases on the disk drives and other storage media of BellSouth’s computer systems.

Control Activities:

Control activities include the use of passwords and other security codes by customers, suppliers, and employees for entry into BellSouth’s e-business and e-commerce websites, and access of their databases and knowledge bases.

COMPONENTS OF AN INFORMATION SYSTEM

An information system model expresses a fundamental conceptual framework for the major components and activities of information systems.  An information system depends on the resources of people, hardware, software, data, and networks to perform input, processing, output, storage, and control activities that convert data resources into information products.

The information systems model outlined in the text emphasizes four major concepts that can be applied to all types of information systems:

·         People, hardware, software, data, and networks, are the five basic resources of information systems.

·         People resources include end users and IS specialists, hardware resources consist of machines and media, software resources include both programs and procedures, data resources can include data and knowledge bases, and network resources include communications media and networks.

·         Data resources are transformed by information processing activities into a variety of information products for end users.

·         Information processing consists of input, processing, output, storage, and control activities.

INFORMATION SYSTEM RESOURCES

The basic IS model shows that an information system consists of five major resources:

·         People resources

·         Hardware resources

·         Software resources

·         Data resources

·         Network resources

People Resources:     

People are required for the operation of all information systems.  These people resources include end users and IS specialists.

·         End Users (also called users or clients) are people who use an information system or the information it produces.  Most of us are information system end users.  And most end users in business are knowledge workers, that is, people who spend most of their time communicating and collaborating in teams of workgroups and creating, using, and distributing information.

·         IS Specialists are people who develop and operate information systems.  They include system analysts, software developers, system operators, and other managerial, technical, and clerical IS personnel.

Systems analysts – design information systems based on the information requirements of end users.

Software developers – create computer programs based on the specifications of systems analysts.

System operators – monitor and operate large computer systems and networks.

Hardware Resources:

Hardware resources include all physical devices and materials used in information processing.

·         Machines  - physical devices (computers, peripherals, telecommunications networks, etc.)

·         Media        - all tangible objects on which data are recorded (paper, magnetic disks etc.)

Examples of hardware in computer-based information systems are:

·         Computer Systems – which consist of central processing units containing microprocessors, and a variety of interconnected peripheral devices.

·         Computer peripherals – which are devices such as a keyboard or electronic mouse for input of data and commands, a video screen or printer for output of information, and magnetic or optical disks for storage of data resources.

Software Resources:  

Software resources include all sets of information processing instructions. 

·         Program - a set of instructions that causes a computer to perform a particular task.

·         Procedures - set of instructions used by people to complete a task.

Examples of software resources are:

·         System software – such as an operating system program, that controls and supports the operations of a computer system.

·         Application software – are programs that direct processing for a particular use of computers by end users.

·         Procedures – are operating instructions for the people who will use an information system.

Data Resources:

Data constitutes a valuable organizational resource.  Thus, data resources must be managed effectively to benefit all end users in an organization.  The data resources of information systems are typically organized into:

·         Databases - a collection of logically related records or files.  A database consolidates many records previously stored in separate files so that a common pool of data records serves many applications.

·         Knowledge Bases - which hold knowledge in a variety of forms such as facts and rules of inference about various subjects.

Data versus Information.  The word data is the plural of datum, though data is commonly used to represent both singular and plural forms.  The term’s data and information are often used interchangeably.  However, you should make the following distinction:

Data: - are raw facts or observations, typically about physical phenomena or business transactions.  More specifically, data are objective measurements of the attributes (characteristics) of entities, such as people, places, things, and events.

Information: - is processed data, which has been placed in a meaningful and useful context for an end user.  Data is subjected to a “value-added” process (data processing or information processing) where:

·         Its form is aggregated, manipulated, and organized.

·         Its content is analyzed and evaluated

·         It is placed in a proper context for a human user

Network Resources:

Telecommunications networks like the Internet, intranets, and extranets have become essential to the successful electronic business and commerce operations of all types of organizations and their computer-based information systems.  Telecommunications networks consist of computers, communications processors, and other devices interconnected by communications media and controlled by communications software.  The concept of network resources emphasizes that communications networks are a fundamental resource component of all information systems.  Network resources include:

·         Communications media (twisted-pair wire, coaxial cable, fiber-optic cable, and microwave, cellular, and satellite wireless systems.

·         Network support (people, hardware, software, and data resources that directly support the operation and use of a communications network).