Instructor Manual: Bidgoli, MIS, 12e ©27, 9798214410388
Instructor Manual Chapter 01
BIDGOLI, MIS, 12E ©27, 9798214410388;
CHAPTER 01: INFORMATION SYSTEMS IN
TABLE OF CONTENTS
Purpose and Perspective of the Chapter.......................................................................................3
Chapter Objectives..................................................................................................................................3
What's New in This Chapter.............................................................................................................. 3
Chapter Outline....................................................................................................................................... 4
Complete List of Chapter Activities and Assessments............................................................12
Additional Activities and Assignments.........................................................................................13
I. Computers and Information Systems in Daily Life..............................................................................13
II. Computer Literacy and Information Literacy..................................................................................... 14
III. The Beginning: Transaction-Processing Systems..............................................................................14
IV. Management Information Systems.................................................................................................... 14
V. Major Components of an Information System....................................................................................14
VI. Strategic Information Systems...........................................................................................................15
VII. Using Information Systems and Information Technologies.............................................................15
VII. The IT Job Market............................................................................................................................ 15
VIII. Outlook for the Future.....................................................................................................................15
Key Terms............................................................................................................................................... 16
Appendix.................................................................................................................................................. 17
Generic Rubrics....................................................................................................................................... 17
Standard Writing Rubric.......................................................................................................................... 17
Standard Discussion Rubric.....................................................................................................................18
© 2027 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly 1
accessible website, in whole or in part.
, Instructor Manual: Bidgoli, MIS, 12e ©27, 9798214410388
PURPOSE AND PERSPECTIVE OF THE CHAPTER
This Chapter starts with an overview of common uses for computers and information systems, explains
the difference between computer literacy and information literacy, and reviews transaction-processing
systems as one of the earliest applications of information systems. Next, the Chapter discusses the
components of a management information system, including data, databases, processes, and information;
explains strategic information systems and their applications; and then delves into how information
systems relate to information technologies (IT). This Chapter also covers the roles and applications of
information systems and explains the Five Forces Model, which is used to develop strategies for gaining a
competitive advantage. Finally, the Chapter reviews the IT job market and touches on the future of
information systems.
CHAPTER OBJECTIVES
The following objectives are addressed in this Chapter:
1.1 Discuss common applications of computers and information systems.
1.2 Explain the difference between computer literacy and information literacy.
1.3 Define transaction-processing systems.
1.4 Define management information systems.
1.5 Describe the four major components of an information system.
1.6 Define strategic information systems.
1.7 Discuss the differences between data and information
1.8 Explain the importance and application of information systems in functional areas of business
1.9 Analyze how information technologies are used to gain a competitive advantage.
1.10 Apply the Five Forces Model and strategies for gaining a competitive advantage
1.11 Review the IT job market.
1.12 Summarize the future outlook of information systems.
WHAT'S NEW IN THIS CHAPTER
Read about updates and improvements in this Chapter:
All IS/IT statistics, hardware, software, and applications have been updated.
All cases and information boxes when needed have been updated.
Quick Check and Review Quiz have been added.
The information box on Home Depot has been expanded.
The information box on Domino's has been expanded.
IT/AI jobs have been expanded.
Generative AI applications in marketing have been expanded.
CASE STUDY 1-2 has been expanded.
CHAPTER OUTLINE
I. Computers and Information Systems in Daily Life
1. Organizations use computers and information systems to reduce costs and gain a competitive
advantage in the marketplace. Many workers are now telecommuters who perform their jobs at
© 2027 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly 2
accessible website, in whole or in part.
, Instructor Manual: Bidgoli, MIS, 12e ©27, 9798214410388
home, and others often use their smartphone for business applications. Smartphones are mobile
phones with advanced capabilities, much like a mini PC. They include e-mail and Web-browsing
features, and most have a built-in keyboard or an external USB keyboard. Increasingly, tablet
computers, such as iPads, are being used. These tablets come with apps (small programs) for
common applications, and they can improve the user’s efficiency.
2. The Internet is used for all kinds of activities, from shopping to learning to working. The Internet
is also used for social purposes. Organizations also use social networking sites to give customers
up-to-date information and how-to support via videos. In addition, people use video-sharing sites
to watch news, sporting events, and entertainment videos.
3. Computers and information technology will help the knowledge workers of the future perform
more effectively and productively, no matter what profession they choose. In addition, these
workers will be able to connect to the rest of the world to share information, knowledge, videos,
ideas, and almost anything else that can be digitized.
4. The terms information systems and information technologies are used interchangeably.
Information systems are broader in scope than information technologies, but the two overlap in
many areas. Both are used to help organizations be more competitive and to improve their overall
efficiency and effectiveness. Information technologies offer many advantages for improving
decision making but involve some challenges like security and privacy issues.
II. Computer Literacy and Information Literacy
1. Computer literacy is skill in using productivity software, such as word processors,
spreadsheets, database management systems, and presentation software, as well as having a basic
knowledge of hardware and software, the Internet, and collaboration tools and technologies.
Information literacy, on the other hand, is understanding the role of information in
generating and using business intelligence. Business intelligence (BI) provides historical,
current, and predictive views of business operations and environments and gives organizations a
competitive advantage in the marketplace.
III. The Beginning: Transaction-Processing Systems
1. For the past 60 years, transaction-processing systems (TPSs) have been applied to
structured tasks such as record keeping, simple clerical operations, and inventory control. Payroll,
for example, was one of the first applications to be automated. TPSs focus on data collection and
processing, and they have provided enormous reductions in costs.
2. Computers are most beneficial in transaction-processing operations. These operations are
repetitive or involve enormous volumes of data. When these systems are automated, human
involvement is minimal.
IV. Management Information Systems
1. A management information system (MIS) is an organized integration of hardware and
software technologies, data, processes, and human elements designed to produce timely,
integrated, relevant, accurate, and useful information for decision-making purposes.
2. The hardware components include input, output, and memory devices and vary depending on the
application and the organization. MIS software include commercial programs, software
developed in-house, or both. The application or organization determines the type of software
used. Processes are usually methods for performing a task in an MIS application. The human
element includes users, programmers, systems analysts, and other technical personnel.
3. In designing an MIS, the first task is to clearly define the system’s objectives. Second, data must
be collected and analyzed. Finally, information must be provided in a useful format for decision-
© 2027 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly 3
accessible website, in whole or in part.
, Instructor Manual: Bidgoli, MIS, 12e ©27, 9798214410388
making purposes. Many MIS applications are used in both the private and public sectors.
V. Major Components of an Information System
1. In addition to hardware, software, and human elements, an information system includes four
major components.
A. Data
1. The data component of an information system is considered the input to the system. The
information that users need affects the type of data that is collected and used. Generally, there are
two sources of data: external and internal. An information system should collect data from both
sources, although organizational objectives and the type of application also determine what
sources to use.
2. Internal data includes sales records, personnel records, and so forth. The following list shows
some examples of external data sources:
a. Customers, competitors, and suppliers
b. Government agencies and financial institutions
c. Labor and population statistics
d. Economic conditions
3. Typically, data has a time orientation, too. Data can also be collected in different forms, such as
aggregated (e.g., subtotals for categories of information) or disaggregated (e.g., itemized lists).
4. If an organization has defined its strategic goals, objectives, and critical success factors, then
structuring the data component to define what type of data is collected and in what form is
usually easy. On the other hand, if there are conflicting goals and objectives or the company is
not aware of critical success factors, many problems in data collection can occur, which affects an
information system’s reliability and effectiveness.
B. Database
1. A database, the heart of an information system, is a collection of all relevant data organized in
a series of integrated files. To create, organize, and manage databases, a database management
system (DBMS) is used, such as Microsoft Access or FileMaker Pro for home or small-office use.
In a large organization, a DBMS such as Oracle or IBM DB2 might be used.
2. Databases are also important for reducing personnel time needed to gather, process, and interpret
data manually. With a computerized database and a DBMS, data can be treated as a common
resource that is easy to access and use.
C. Process
1. The purpose of an information system’s process component is generating the most useful type
of information for making decisions. This component generally includes transaction-processing
reports and models for decision analysis that can be built into the system or accessed from
external sources.
2. Users should be able to query an information system and generate a variety of reports. In
addition, an information system should be able to grow with the organization so users can
redefine and restructure models and incorporate new information into their analyses.
D. Information
1. Information is the output of an information system which consists of facts that have been
analyzed by the process component and are therefore more useful to the MIS user.
2. The quality of information is determined by its usefulness to users, and its usefulness determines
the success of an information system. Information is useful if it enables decision makers to make
the right decision in a timely manner. To be useful, information must have the following qualities:
© 2027 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly 4
accessible website, in whole or in part.
Instructor Manual Chapter 01
BIDGOLI, MIS, 12E ©27, 9798214410388;
CHAPTER 01: INFORMATION SYSTEMS IN
TABLE OF CONTENTS
Purpose and Perspective of the Chapter.......................................................................................3
Chapter Objectives..................................................................................................................................3
What's New in This Chapter.............................................................................................................. 3
Chapter Outline....................................................................................................................................... 4
Complete List of Chapter Activities and Assessments............................................................12
Additional Activities and Assignments.........................................................................................13
I. Computers and Information Systems in Daily Life..............................................................................13
II. Computer Literacy and Information Literacy..................................................................................... 14
III. The Beginning: Transaction-Processing Systems..............................................................................14
IV. Management Information Systems.................................................................................................... 14
V. Major Components of an Information System....................................................................................14
VI. Strategic Information Systems...........................................................................................................15
VII. Using Information Systems and Information Technologies.............................................................15
VII. The IT Job Market............................................................................................................................ 15
VIII. Outlook for the Future.....................................................................................................................15
Key Terms............................................................................................................................................... 16
Appendix.................................................................................................................................................. 17
Generic Rubrics....................................................................................................................................... 17
Standard Writing Rubric.......................................................................................................................... 17
Standard Discussion Rubric.....................................................................................................................18
© 2027 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly 1
accessible website, in whole or in part.
, Instructor Manual: Bidgoli, MIS, 12e ©27, 9798214410388
PURPOSE AND PERSPECTIVE OF THE CHAPTER
This Chapter starts with an overview of common uses for computers and information systems, explains
the difference between computer literacy and information literacy, and reviews transaction-processing
systems as one of the earliest applications of information systems. Next, the Chapter discusses the
components of a management information system, including data, databases, processes, and information;
explains strategic information systems and their applications; and then delves into how information
systems relate to information technologies (IT). This Chapter also covers the roles and applications of
information systems and explains the Five Forces Model, which is used to develop strategies for gaining a
competitive advantage. Finally, the Chapter reviews the IT job market and touches on the future of
information systems.
CHAPTER OBJECTIVES
The following objectives are addressed in this Chapter:
1.1 Discuss common applications of computers and information systems.
1.2 Explain the difference between computer literacy and information literacy.
1.3 Define transaction-processing systems.
1.4 Define management information systems.
1.5 Describe the four major components of an information system.
1.6 Define strategic information systems.
1.7 Discuss the differences between data and information
1.8 Explain the importance and application of information systems in functional areas of business
1.9 Analyze how information technologies are used to gain a competitive advantage.
1.10 Apply the Five Forces Model and strategies for gaining a competitive advantage
1.11 Review the IT job market.
1.12 Summarize the future outlook of information systems.
WHAT'S NEW IN THIS CHAPTER
Read about updates and improvements in this Chapter:
All IS/IT statistics, hardware, software, and applications have been updated.
All cases and information boxes when needed have been updated.
Quick Check and Review Quiz have been added.
The information box on Home Depot has been expanded.
The information box on Domino's has been expanded.
IT/AI jobs have been expanded.
Generative AI applications in marketing have been expanded.
CASE STUDY 1-2 has been expanded.
CHAPTER OUTLINE
I. Computers and Information Systems in Daily Life
1. Organizations use computers and information systems to reduce costs and gain a competitive
advantage in the marketplace. Many workers are now telecommuters who perform their jobs at
© 2027 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly 2
accessible website, in whole or in part.
, Instructor Manual: Bidgoli, MIS, 12e ©27, 9798214410388
home, and others often use their smartphone for business applications. Smartphones are mobile
phones with advanced capabilities, much like a mini PC. They include e-mail and Web-browsing
features, and most have a built-in keyboard or an external USB keyboard. Increasingly, tablet
computers, such as iPads, are being used. These tablets come with apps (small programs) for
common applications, and they can improve the user’s efficiency.
2. The Internet is used for all kinds of activities, from shopping to learning to working. The Internet
is also used for social purposes. Organizations also use social networking sites to give customers
up-to-date information and how-to support via videos. In addition, people use video-sharing sites
to watch news, sporting events, and entertainment videos.
3. Computers and information technology will help the knowledge workers of the future perform
more effectively and productively, no matter what profession they choose. In addition, these
workers will be able to connect to the rest of the world to share information, knowledge, videos,
ideas, and almost anything else that can be digitized.
4. The terms information systems and information technologies are used interchangeably.
Information systems are broader in scope than information technologies, but the two overlap in
many areas. Both are used to help organizations be more competitive and to improve their overall
efficiency and effectiveness. Information technologies offer many advantages for improving
decision making but involve some challenges like security and privacy issues.
II. Computer Literacy and Information Literacy
1. Computer literacy is skill in using productivity software, such as word processors,
spreadsheets, database management systems, and presentation software, as well as having a basic
knowledge of hardware and software, the Internet, and collaboration tools and technologies.
Information literacy, on the other hand, is understanding the role of information in
generating and using business intelligence. Business intelligence (BI) provides historical,
current, and predictive views of business operations and environments and gives organizations a
competitive advantage in the marketplace.
III. The Beginning: Transaction-Processing Systems
1. For the past 60 years, transaction-processing systems (TPSs) have been applied to
structured tasks such as record keeping, simple clerical operations, and inventory control. Payroll,
for example, was one of the first applications to be automated. TPSs focus on data collection and
processing, and they have provided enormous reductions in costs.
2. Computers are most beneficial in transaction-processing operations. These operations are
repetitive or involve enormous volumes of data. When these systems are automated, human
involvement is minimal.
IV. Management Information Systems
1. A management information system (MIS) is an organized integration of hardware and
software technologies, data, processes, and human elements designed to produce timely,
integrated, relevant, accurate, and useful information for decision-making purposes.
2. The hardware components include input, output, and memory devices and vary depending on the
application and the organization. MIS software include commercial programs, software
developed in-house, or both. The application or organization determines the type of software
used. Processes are usually methods for performing a task in an MIS application. The human
element includes users, programmers, systems analysts, and other technical personnel.
3. In designing an MIS, the first task is to clearly define the system’s objectives. Second, data must
be collected and analyzed. Finally, information must be provided in a useful format for decision-
© 2027 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly 3
accessible website, in whole or in part.
, Instructor Manual: Bidgoli, MIS, 12e ©27, 9798214410388
making purposes. Many MIS applications are used in both the private and public sectors.
V. Major Components of an Information System
1. In addition to hardware, software, and human elements, an information system includes four
major components.
A. Data
1. The data component of an information system is considered the input to the system. The
information that users need affects the type of data that is collected and used. Generally, there are
two sources of data: external and internal. An information system should collect data from both
sources, although organizational objectives and the type of application also determine what
sources to use.
2. Internal data includes sales records, personnel records, and so forth. The following list shows
some examples of external data sources:
a. Customers, competitors, and suppliers
b. Government agencies and financial institutions
c. Labor and population statistics
d. Economic conditions
3. Typically, data has a time orientation, too. Data can also be collected in different forms, such as
aggregated (e.g., subtotals for categories of information) or disaggregated (e.g., itemized lists).
4. If an organization has defined its strategic goals, objectives, and critical success factors, then
structuring the data component to define what type of data is collected and in what form is
usually easy. On the other hand, if there are conflicting goals and objectives or the company is
not aware of critical success factors, many problems in data collection can occur, which affects an
information system’s reliability and effectiveness.
B. Database
1. A database, the heart of an information system, is a collection of all relevant data organized in
a series of integrated files. To create, organize, and manage databases, a database management
system (DBMS) is used, such as Microsoft Access or FileMaker Pro for home or small-office use.
In a large organization, a DBMS such as Oracle or IBM DB2 might be used.
2. Databases are also important for reducing personnel time needed to gather, process, and interpret
data manually. With a computerized database and a DBMS, data can be treated as a common
resource that is easy to access and use.
C. Process
1. The purpose of an information system’s process component is generating the most useful type
of information for making decisions. This component generally includes transaction-processing
reports and models for decision analysis that can be built into the system or accessed from
external sources.
2. Users should be able to query an information system and generate a variety of reports. In
addition, an information system should be able to grow with the organization so users can
redefine and restructure models and incorporate new information into their analyses.
D. Information
1. Information is the output of an information system which consists of facts that have been
analyzed by the process component and are therefore more useful to the MIS user.
2. The quality of information is determined by its usefulness to users, and its usefulness determines
the success of an information system. Information is useful if it enables decision makers to make
the right decision in a timely manner. To be useful, information must have the following qualities:
© 2027 Cengage. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly 4
accessible website, in whole or in part.
