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5TH EDITION

Managing and Using Information Systems A Strategic Approach

KERI E. PEARLSON KP Partners

CAROL S. SAUNDERS University of Central Florida Dr. Theo and Friedl Schoeller Research Center for Business and Society

JOHN WILEY & SONS, INC.

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To Yale & Hana

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Library of Congress Cataloging-in-Publication Data Pearlson, Keri.

Managing and using information systems: a strategic approach/Keri E. Pearlson, Carol S. Saunders. 5th ed. p. cm.

Includes index. ISBN 978-1-118-28173-4 (pbk.) 1. Knowledge management. 2. Information technologyManagement. 3. Management information systems.

4. Electronic commerce. I. Saunders, Carol S. II. Title. HD30.2.P4 2013 658.4 0038011dc23 2012015379

Printed in the United States of America 10 9 8 7 6 5 4 3 2 1

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cPreface Information technology and business are becoming inextricably interwoven. I dont think anybody can talk meaningfully about one without the talking about the other.1

Bill Gates Microsoft

Im not hiring MBA students for the technology you learn while in school, but for your ability to learn about, use and subsequently manage new technologies when you get out.

IT Executive Federal Express

Give me a fish and I eat for a day; teach me to fish and I eat for a lifetime. Proverb

Managers do not have the luxury of abdicating participation in information systems decisions. Managers who choose to do so risk limiting their future business options. Information systems are at the heart of virtually every business interaction, process, and decision, especially when one considers the vast penetration of the Web in the last few years. Mobile and social technologies have brought information systems to an entirely new level within firms, and between individuals in their personal lives. Managers who let someone else make decisions about their informa- tion systems are letting someone else make decisions about the very foundation of their business. This is a textbook about managing and using information, written for current and future managers as a way of introducing the broader implications of the impact of information systems.

The goal of this book is to assist managers in becoming knowledgeable partic- ipants in information systems decisions. Becoming a knowledgeable participant means learning the basics and feeling comfortable enough to ask questions. It does not mean having all the answers nor having a deep understanding of all the technologies out in the world today. No text will provide managers with everything they need to know to make important information systems decisions. Some texts instruct on the basic technical background of information systems. Others discuss applications and their life cycle. Some take a comprehensive view of the management information systems (MIS) field and offer readers snapshots of current systems along with chapters describing how those technologies are designed, used, and integrated into business life.

This book takes a different approach. This text is intended to provide the reader with a foundation of basic concepts relevant to using and managing information. It is not intended to provide a comprehensive treatment on any one aspect of MIS, for certainly

1 http://www.woopidoo.com/business quotes/authors/bill-gates-quotes.htm.

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each aspect is itself a topic of many books. It is not intended to provide readers with enough technological knowledge to make them MIS experts. It is not intended to be a source of discussion of any particular technology. This textbook is written to help managers begin to form a point of view of how information systems will help, hinder, and create opportunities for their organizations.

The idea for this text grew out of discussions with colleagues in the MIS area. Many faculties use a series of case studies, trade and popular press readings, and Web sites to teach their MIS courses. Others simply rely on one of the classic texts, which include dozens of pages of diagrams, frameworks, and technologies. The initial idea for this text emerged from a core MIS course taught at the business school at the University of Texas at Austin. That course was considered an appetizer coursea brief introduc- tion into the world of MIS for MBA students. The course had two main topics: using information and managing information. At the time, there was no text like this one, hence students had to purchase thick reading packets made up of articles and case studies to provide them with the basic concepts. The course was structured to provide the general MBA with enough knowledge of the field of MIS that they could recognize opportunities to use the rapidly changing technologies available to them. The course was an appetizer to the menu of specialty courses, each of which went much deeper into the various topics. But completion of the appetizer course meant that students were able to feel comfortable listening to, contributing to, and ultimately participating in information systems decisions.

Today, many students are digital nativespeople who have grown up using information technologies all of their lives. That means that students come to their courses with significantly more knowledge about things like tablets, apps, personal computers, smartphones, texting, the Web, social networking, file downloading, online purchasing, and social media than their counterparts in school just a few years ago. This is a significant trend that is projected to continue; students will be increasingly knowledgeable in personally using technologies. That knowledge has begun to change the corporate environment. Todays digital natives expect to find information systems in corporations that provide at least the functionality they have at home. At the same time, they expect to be able to work in ways that take advantage of the technologies they have grown to depend on for social interaction, collaboration, and innovation. This edition of the text has been completely edited with this new group of students in mind. We believe the basic foundation is still needed for managing and using information systems, but we understand that the assumptions and knowledge base of todays students is significantly different.

Also different today is the vast amount of information amassed by firms, sometimes called the . Not only have organizations figured out that there is a lot of data around their processes, their interactions with customers, their products, and their suppliers, but with the increase in communities and social interactions on the Web, there is an additional pressure to collect and analyze vast amounts of unstructured information contained in these conversations to identify trends, needs, and projections. We believe that todays managers face an increasing amount of pressure to understand what is being said by those inside and outside their corporations and to join the

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conversations as much as reasonable. That is significantly different from just a few years ago.

This book includes an introduction, twelve chapters of text and minicases, and a set of case studies and supplemental readings on a Web site. The introduction makes the argument introduced in this preface that managers must be knowledge- able participants in information systems decisions. The first few chapters build a basic framework of relationships between business strategy, information systems strategy, and organizational strategy and explore the links between these strategies. Readers will also find a chapter on how information systems relate to business transformation. Supplemental materials, including longer cases from all over the globe, can be found on the W eb. Please v isit http://www.wiley. for more information.