Principles information SYstems 9e ralph stair and reynolds part 1

NINTH
EDITION

Principles of Information Systems

A Managerial Approach
Ninth Edition

Ralph M. Stair

Professor Emeritus, Florida State University
George W. Reynolds

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Principles of Information Systems,
A Managerial Approach, Ninth Edition by
Ralph M. Stair and George W. Reynolds
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For Lila and Leslie
—RMS
To my grandchildren: Michael, Jacob, Jared, Fievel, Aubrey, Elijah, Abrielle, Sophia, Elliot
—GWR


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BRIEF
CONTENTS

PART 1

PART 2

PART 3

An Overview
Chapter 1

An Introduction to Information Systems

Chapter 2

Information Systems in Organizations

Information Technology Concepts
Chapter 3

Hardware: Input, Processing, and Output Devices

Chapter 4

Software: Systems and Application Software

Chapter 5

Database Systems and Business Intelligence

Chapter 6

Telecommunications and Networks

Chapter 7

The Internet, Intranets, and Extranets

Business Information Systems
Chapter 8

Electronic and Mobile Commerce

Chapter 9

Enterprise Systems

Chapter 10 Information and Decision Support Systems
Chapter 11 Knowledge Management and Specialized Information Systems
PART 4

Systems Development
Chapter 12 Systems Development: Investigation and Analysis
Chapter 13 Systems Development: Design, Implementation, Maintenance, and
Review

PART 5

Information Systems in Business and Society
Chapter 14 The Personal and Social Impact of Information Systems
Glossary
Index

v


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CONTENTS
Preface

xxi

PART 1

An Overview 1

Chapter 1

An Introduction to Information Systems
Fossil, United States 3

2

Information Concepts 5
Data, Information, and Knowledge 5
The Characteristics of Valuable Information 6

The Value of Information 7
System Concepts 8
System Performance and Standards 8
What is an Information System? 10
Input, Processing, Output, Feedback 10
Manual and Computerized Information Systems 11
Computer-Based Information Systems 11
Business Information Systems 15
Electronic and Mobile Commerce 16
Information Systems @ Work: Welcome to Mobile Banking 17
Enterprise Systems: Transaction Processing Systems and Enterprise
Resource Planning 19
Information and Decision Support Systems 20
Ethical and Societal Issues: Green Data Centers 21
Specialized Business Information Systems: Knowledge Management,
Artificial Intelligence, Expert Systems, and Virtual Reality 24
Systems Development 26
Systems Investigation and Analysis 27
Systems Design, Implementation, and Maintenance and Review 28
Information Systems in Society, Business, and Industry 28
Security, Privacy, and Ethical Issues in Information Systems and the
Internet 28
Computer and Information Systems Literacy 30
Information Systems in the Functional Areas of Business 31
Information Systems in Industry 31
Global Challenges in Information Systems 32
Case One: New York City Cabbies Strike Over New Information System 38
Case Two: Yansha Leans on IS to Stay Competitive 39

Chapter 2

Information Systems in Organizations
FedEx, United States 43
Organizations and Information Systems
Organizational Structures

42

44

48

vii


Ethical and Societal Issues: Fighting Global Poverty with Information Systems 49
Organizational Culture and Change

53

Reengineering and Continuous Improvement

55

User Satisfaction and Technology Acceptance

57

Quality

57

Outsourcing, On-Demand Computing, and Downsizing
Competitive Advantage

58

59

Factors That Lead Firms to Seek Competitive Advantage
Strategic Planning for Competitive Advantage

60

61

Information Systems @ Work: Grand & Toy Seeks Competitive Advantage by
Tracking Key Performance Indicators 62
Performance-Based Information Systems
Productivity

64

65

Return on Investment and the Value of Information Systems
Risk

65

66

Careers in Information Systems

66

Roles, Functions, and Careers in IS
Typical IS Titles and Functions
Other IS Careers

68

71

72

Finding a Job in IS

72

Case One: Customer Service Drives Information Systems at Volvo Cars
Belgium

78

Case Two: CIO Plays Important Role at J&J Philippines

78

PART 2

Information Technology Concepts 83

Chapter 3

Hardware: Input, Processing, and Output Devices
UB Spirits, India 85
Computer Systems: Integrating the Power of Technology
Hardware Components

86

87

Hardware Components in Action

88

Processing and Memory Devices: Power, Speed, and Capacity
Processing Characteristics and Functions
Memory Characteristics and Functions
Multiprocessing

89

92

95

97

Access Methods
Devices

89

95

Parallel Computing
Secondary Storage

84

98

99

Enterprise Storage Options

102

Input and Output Devices: The Gateway to Computer Systems
Characteristics and Functionality
Input Devices

103

104

105

Ethical and Societal Issues: Collecting Accurate and Verifiable Data Where It
Counts 110
Output Devices
viii

111

Special-Purpose Input and Output Devices

114


Computer System Types

115

Computer System Types

116

Information Systems @ Work: Penguins, Animal Logic, and Blades 121
Case One: Advance America Implements Grid Computing

127

Case Two: Mayo Clinic Turns to Game Processor to Save Lives

Chapter 4

Software: Systems and Application Software
General Motors, United States 133
An Overview of Software

132

134

Systems Software

134

Application Software

135

Supporting Individual, Group, and Organizational Goals
Systems Software

128

135

136

Operating Systems

136

Current Operating Systems

140

Workgroup Operating Systems

143

Enterprise Operating Systems

144

Operating Systems for Small Computers, Embedded Computers, and
Special-Purpose Devices
Utility Programs
Middleware

145

147

149

Application Software

150

Information Systems @ Work: Software Helps Target Radiation Treatment for
Cancer 151
Overview of Application Software

152

Ethical and Societal Issues: Imperial Chemical Turns to SaaS Security Tools 154
Personal Application Software

155

Workgroup Application Software

161

Enterprise Application Software

162

Application Software for Information, Decision Support, and Specialized
Purposes

163

Programming Languages

163

The Evolution of Programming Languages
Software Issues and Trends
Software Bugs

164

167

167

Copyrights and Licenses
Open-Source Software

167
168

Shareware, Freeware, and Public Domain Software
Software Upgrades

169

170

Global Software Support

170

Case One: Systems Management Software Helps Fight Crime

Chapter 5

Case Two: Energy Giant Valero Turns to SOA Software

176

Database Systems and Business Intelligence

Wal-Mart, United States 181

180

Data Management

175

183

The Hierarchy of Data

183
ix


Data Entities, Attributes, and Keys

183

Ethical and Societal Issues: Web-Based Electronic Health Record Systems 187
Data Modeling and Database Characteristics
Data Modeling

188

188

The Relational Database Model
Database Management Systems

193

Overview of Database Types
Providing a User View

189

193

194

Creating and Modifying the Database
Storing and Retrieving Data

195

196

Manipulating Data and Generating Reports
Database Administration

197

200

Popular Database Management Systems
Special-Purpose Database Systems

201

201

Selecting a Database Management System
Using Databases with Other Software
Database Applications

201

202

203

Linking the Company Database to the Internet

203

Data Warehouses, Data Marts, and Data Mining
Business Intelligence

203

208

Information Systems @ Work: Yangtze Power Harnesses the Power 209
Distributed Databases

210

Online Analytical Processing (OLAP)

211

Object-Relational Database Management Systems
Visual, Audio, and Other Database Systems
Case One: The Getty Vocabularies

212

212

218

Case Two: ETAI Manages Auto Parts Overload with Open-Source Database

Chapter 6

Telecommunications and Networks
Deloitte, Milan, Italy 223
An Overview of Telecommunications

222

225

Basic Telecommunications Channel Characteristics
Short Range Wireless Options

230

Medium Range Wireless Options

231

Wide Area Wireless Network Options

232

Future Wireless Communications Developments
Networks and Distributed Processing
Network Types

236

236

Basic Processing Alternatives
Client/Server Systems

238

239

Telecommunications Hardware
Telecommunications Software
Securing Data Transmission
Other Encryption Methods

x

240
242

243
245

Virtual Private Network (VPN)

226

245

235

219


Telecommunications Services and Network Applications
Cellular Phone Services

245

246

Ethical and Societal Issues: Bangalore Clears Congestion with
Telecommunications 247
Linking Personal Computers to Mainframes and Networks
Voice Mail

249

249

Home and Small Business Networks
Electronic Document Distribution
Call Centers

250

250

250

Telecommuting and Virtual Workers and Workgroups
Videoconferencing

251

252

Information Systems @ Work: Telepresence Eliminates Travel and Saves Valuable
Human Resources 253
Electronic Data Interchange
Public Network Services

254

254

Electronic Funds Transfer

Distance Learning

255

Shared Workspace

255

Unified Communications

255

256

Specialized Systems and Services

257

Case One: Latest Telecom Technologies Feed Crucial Information to Physicians
in CHA

261

Case Two: Del Monte Provides Secure Connections for Telecommuters

Chapter 7

The Internet, Intranets, and Extranets
Lamborghini, Italy 267
Use and Functioning of the Internet

How the Internet Works

262

266

269

270

Internet Service Providers

273

Ethical and Societal Issues: Comcast, Packet Shaping, and Net Neutrality 275
The World Wide Web

276

Web 2.0 and the Social Web

279

Web Programming Languages
Developing Web Content
Web Services

280

280

281

Internet and Web Applications

282

Search Engines and Web Research
Business Uses of the Web

282

285

E-mail, Instant Messaging, and Video Chat
Career Information and Job Searching
Telnet, SSH, and FTP

285

287

288

Web Log (Blog), Video Log (Vlog), and Podcasting
Usenet and Newsgroups
Chat Rooms

288

290

290

Internet Phone and Videoconferencing Services

291
xi


Social Networks

291

Media Sharing

293

Social Bookmarking

293

Content Streaming

294

Shopping on the Web
Web Auctions

294

294

Music, Radio, Video, and TV on the Internet
E-Books and Audio Books
Office on the Web

294

296

296

Internet Sites in Three Dimensions

297

Other Internet Services and Applications

297

Information Systems @ Work: Chevron Takes to the Clouds 299
Intranets and Extranets
Net Issues

300

300

Case One: The Best Online Brick-and-Mortar Retailer

306

Case Two: Procter & Gamble Implement Enterprise 2.0

PART 3

Business Information Systems 309

Chapter 8

Electronic and Mobile Commerce
Staples, United States 311
An Introduction to Electronic Commerce

310
312

Business-to-Business (B2B) E-Commerce
Business-to-Consumer (B2C) E-Commerce
Consumer-to-Consumer (C2C) E-Commerce
e-Government

312
313
313

314

Multistage Model for E-Commerce

Supply Chain Management

314

317

Customer Relationship Management
E-Commerce Challenges

320

Mobile Commerce in Perspective
M-Commerce Web Sites

320

320

Electronic and Mobile Commerce Applications
Retail and Wholesale
Manufacturing

317

317

An Introduction to Mobile Commerce

Marketing

307

321

321

321

323

Investment and Finance

324

Information Systems @ Work: MoneyAisle.com Puts Customers in Charge 326
Online Real Estate Services
E-Boutiques
Auctions

327

327

327

Anywhere, Anytime Applications of Mobile Commerce
Advantages of Electronic and Mobile Commerce

Global Challenges for E-Commerce and M-Commerce

xii

327

329
329


Threats to Electronic and Mobile Commerce
Security

331

Theft of Intellectual Property
Fraud

331

331

332

Invasion of Consumer Privacy
Lack of Internet Access

333

Return on Investment
Legal Jurisdiction
Taxation

333

333

333

333

Strategies for Successful E-Commerce and M-Commerce
Defining the Web Site Functions
Establishing a Web Site

334

334

334

Building Traffic to Your Web Site

336

Maintaining and Improving Your Web Site

337

Technology Infrastructure Required to Support E-Commerce and
M-Commerce

337

Hardware

338

Web Server Software

338

E-Commerce Software

339

Ethical and Societal Issues: Manipulating Cyberstatus 342
Technology Needed for Mobile Commerce
Electronic Payment Systems
Case One: The NFL and B2B

343

351

Case Two: Paying with Cell Phones in Canada

Chapter 9

343

352

Enterprise Systems 356
Maporama, France 357
An Overview of Enterprise Systems: Transaction Processing Systems and
Enterprise Resource Planning

358

Traditional Transaction Processing Methods and Objectives

359

Transaction Processing Systems for Small and Medium-Size Enterprises
(SMEs)

363

Transaction Processing Activities
Data Collection

363

363

Information Systems @ Work: Georgia Aquarium Controls Crowds with
Online TPS 365
Data Editing

366

Data Correction

366

Data Manipulation
Data Storage

366

366

Document Production and Reports
Control and Management Issues
Disaster Recovery Plan

366

367
367

Ethical and Societal Issues: JetBlue—Trial by Fire and Ice 368
Transaction Processing System Audit

369
xiii


Enterprise Resource Planning, Supply Chain Management, and Customer
Relationship Management

370

An Overview of Enterprise Resource Planning
Advantages of ERP

370

371

Disadvantages of ERP Systems

373

ERP for Small and Medium-Size Enterprises (SMEs)
Business Intelligence

374

374

Production and Supply Chain Management

375

Customer Relationship Management and Sales Ordering
Financial and Managerial Accounting

379

Hosted Software Model for Enterprise Software

381

International Issues associated with Enterprise Systems
Different Languages and Cultures

Multiple Currencies
Leading ERP Systems

381

381

Disparities in Information System Infrastructure
Varying Laws and Customs Rules

382

382

382
383

Case One: Aselsan Overhauls Core Systems

388

Case Two: Delhi Government Embraces Enterprise Systems

Chapter 10

Information and Decision Support Systems
General Mills, United States 393
Decision Making and Problem Solving

389

392

394

Decision Making as a Component of Problem Solving
Programmed versus Nonprogrammed Decisions

395

396

Optimization, Satisficing, and Heuristic Approaches
Sense and Respond

376

397

398

The Benefits of Information and Decision Support Systems
An Overview of Management Information Systems

398

399

Management Information Systems in Perspective
Inputs to a Management Information System

399

400

Ethical and Societal Issues: Web 2.0 MIS Finds Compromise Between Service
and Privacy 401
Outputs of a Management Information System

402

Characteristics of a Management Information System
Functional Aspects of the MIS

404

405

Financial Management Information Systems

406

Manufacturing Management Information Systems

407

Information Systems @ Work: Pharmaceutical Company Reduces
Time-to-Market 411
Marketing Management Information Systems

412

Human Resource Management Information Systems
Other Management Information Systems
An Overview of Decision Support Systems

417

418

Characteristics of a Decision Support System
Capabilities of a Decision Support System
xiv

419

418

414


A Comparison of DSS and MIS

421

Components of a Decision Support System
The Database

421

421

The Model Base

423

The User Interface or Dialogue Manager
Group Support Systems

423

423

Characteristics of a GSS That Enhance Decision Making
GSS Software

424

426

GSS Alternatives

427

Executive Support Systems

429

Executive Support Systems in Perspective

429

Capabilities of Executive Support Systems

430

Case One: Enterprise Rent-A-Car and Business Process Management
Case Two: Keiper Watches Production Like a Hawk

Chapter 11

436

437

Knowledge Management and Specialized Information
Systems 440
Ericsson, Sweden 441
Knowledge Management Systems

442

Overview of Knowledge Management Systems

443

Data and Knowledge Management Workers and Communities of
Practice

444

Obtaining, Storing, Sharing, and Using Knowledge
Technology to Support Knowledge Management
An Overview of Artificial Intelligence

446

447

Artificial Intelligence in Perspective
The Nature of Intelligence

445

448

448

The Difference Between Natural and Artificial Intelligence
The Major Branches of Artificial Intelligence
Expert Systems
Robotics

450

450

450

450

Vision Systems

452

Natural Language Processing and Voice Recognition
Learning Systems
Neural Networks

454

454
455

Other Artificial Intelligence Applications

455

Ethical and Societal Issues: Providing Knowledge to Physicians Just in Time 457
An Overview of Expert Systems

458

When to Use Expert Systems

Components of Expert Systems
The Inference Engine

458
459

461

The Explanation Facility

461

The Knowledge Acquisition Facility
The User Interface

461

462

Participants in Developing and Using Expert Systems
Expert Systems Development Tools and Techniques

462
463
xv


Applications of Expert Systems and Artificial Intelligence
Virtual Reality

464

465

Interface Devices

465

Forms of Virtual Reality

467

Virtual Reality Applications

467

Information Systems @ Work: Realtors Rely on Virtual Reality 470
Other Specialized Systems

471

Case One: Bird & Bird Have Knowledge in Hand

478

Case Two: Where Virtual Worlds and AI Collide

478

PART 4

Systems Development 483

Chapter 12

Systems Development: Investigation and Analysis
GRUMA, Mexico 485
An Overview of Systems Development

484

486

Participants in Systems Development
Initiating Systems Development

487

489

Information Systems Planning and Aligning Corporate and IS Goals

490

Information Systems @ Work: Investigating Conversion at Art.com 493
Establishing Objectives for Systems Development
Systems Development Life Cycles

496

The Traditional Systems Development Life Cycle
Prototyping

494
497

498

Rapid Application Development, Agile Development, Joint Application
Development, and Other Systems Development Approaches
The End-User Systems Development

501

Outsourcing and On-Demand Computing

502

Factors Affecting Systems Development Success

503

Degree of Change

504

Ethical and Societal Issues: When Systems Development Fails 505
Quality and Standards

506

Use of Project Management Tools

507

Use of Computer-Aided Software Engineering (CASE) Tools
Object-Oriented Systems Development
Systems Investigation

509

510

Initiating Systems Investigation

511

Participants in Systems Investigation
Feasibility Analysis

511

511

Object-Oriented Systems Investigation
The Systems Investigation Report
Systems Analysis

514

General Considerations

514

Participants in Systems Analysis
Data Collection
Data Analysis

514
516

Requirements Analysis
xvi

513

520

514

512

509

500


Object-Oriented Systems Analysis
The Systems Analysis Report

522

522

Case One: Ontario and London Hydro Move to Smart Metering

529

Case Two: Information and Security Systems at the All England Lawn Tennis and
Croquet Club

Chapter 13

529

Systems Development: Design, Implementation, Maintenance, and
Review 534
Carlsberg Polska, Poland 535
Systems Design

536

Logical and Physical Design
Object-Oriented Design

537

537

Interface Design and Controls

538

Design of System Security and Controls

539

Ethical and Societal Issues: Going Green Saves Millions of Dollars for
Nationwide 544
Environmental Design Considerations

545

Generating Systems Design Alternatives
Evaluation Techniques

546

547

Information Systems @ Work: Ryder’s GPS System Development Nearly Out of
Control 550
Freezing Design Specifications
The Contract

551

551

The Design Report

Systems Implementation

551
552

Acquiring Hardware from an IS Vendor
Acquiring Software: Make or Buy?

552

554

Acquiring Database and Telecommunications Systems
User Preparation

IS Personnel: Hiring and Training
Site Preparation
Data Preparation
Installation
Testing
Start-Up

557

557
558

558

558

559

User Acceptance

560

Systems Operation and Maintenance
Reasons for Maintenance
Types of Maintenance

560

561

562

The Request for Maintenance Form
Performing Maintenance

562

562

The Relationship Between Maintenance and Design
Systems Review

556

557

563

564

Types of Review Procedures

564

System Performance Measurement

565
xvii


Case One: Rogers Pulls an All-Nighter

571

Case Two: Northrop Grumman Builds Super Systems

572

PART 5

Information Systems in Business and Society 575

Chapter 14

The Personal and Social Impact of Computers
eBay, United States 577

Computer Waste and Mistakes
Computer Waste

578

579

Computer-Related Mistakes

579

Preventing Computer-Related Waste and Mistakes
Establishing Policies and Procedures
Monitoring Policies and Procedures

581

581

Reviewing Policies and Procedures

582

582

The Computer as a Tool to Commit Crime
Cyberterrorism
Identity Theft

583

584
584

Internet Gambling

585

The Computer as the Object of Crime
Illegal Access and Use

585

585

Using Antivirus Programs
Spyware

580

580

Implementing Policies and Procedures

Computer Crime

576

587

589

Information and Equipment Theft

590

Safe Disposal of Personal Computers
Patent and Copyright Violations
Computer-Related Scams

591

591

593

Ethical and Societal Issues: International Cyber Espionage 595
International Computer Crime
Preventing Computer-Related Crime

596
596

Crime Prevention by State and Federal Agencies
Crime Prevention by Corporations

596

Using Intrusion Detection Software
Security Dashboard

596

598

599

Using Managed Security Service Providers (MSSPs)
Filtering and Classifying Internet Content
Internet Libel Concerns

600

Preventing Crime on the Internet
Privacy Issues

601

602

Privacy and the Federal Government
Privacy at Work
E-Mail Privacy

602

602
603

Instant Messaging Privacy

603

Privacy and Personal Sensing Devices
Privacy and the Internet
xviii

600

604

604

599


Fairness in Information Use

605

Information Systems @ Work: Controlling Privacy in Finland’s Largest Information
System 608
Corporate Privacy Policies

609

Individual Efforts to Protect Privacy
The Work Environment
Health Concerns

609

610
610

Avoiding Health and Environmental Problems
Ethical Issues in Information Systems

611

612

Case One: IT Consumerization and Web 2.0 Security Challenges
Case Two: San Francisco WAN Held Captive
Glossary
Index

618

619

621

635

xix


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PREFACE
As organizations continue to operate in an increasingly competitive and global marketplace,
workers in all business areas including accounting, finance, human resources, marketing,
operations management, and production must be well prepared to make significant contributions required for success. Regardless of your future role, you need to understand what
information systems can and cannot do and be able to use them to help you accomplish your
work. You will be expected to discover opportunities to use information systems and to
participate in the design of solutions to business problems employing information systems.
You will be challenged to identify and evaluate information systems options. To be successful,
you must be able to view information systems from the perspective of business and organizational needs. For your solutions to be accepted, you must recognize and address their impact
on fellow workers, customers, suppliers, and other key business partners. For these reasons,
a course in information systems is essential for students in today’s high-tech world.
Principles of Information Systems: A Managerial Approach, Ninth Edition, continues the
tradition and approach of the previous editions. Our primary objective is to provide the best
information systems text and accompanying materials for the first information technology
course required of all business students. We want you to learn to use information technology
to ensure your personal success in your current or future job and to improve the success of
your organization. Through surveys, questionnaires, focus groups, and feedback that we have
received from current and past adopters, as well as others who teach in the field, we have
been able to develop the highest-quality set of teaching materials available to help you achieve
these goals.
Principles of Information Systems: A Managerial Approach, Ninth Edition, stands proudly
at the beginning of the IS curriculum and remains unchallenged in its position as the only
IS principles text offering the basic IS concepts that every business student must learn to be
successful. In the past, instructors of the introductory course faced a dilemma. On one hand,
experience in business organizations allows students to grasp the complexities underlying
important IS concepts. For this reason, many schools delayed presenting these concepts until
students completed a large portion of the core business requirements. On the other hand,
delaying the presentation of IS concepts until students have matured within the business
curriculum often forces the one or two required introductory IS courses to focus only on

personal computing software tools and, at best, merely to introduce computer concepts.
This text has been written specifically for the introductory course in the IS curriculum.
Principles of Information Systems: A Managerial Approach, Ninth Edition, treats the appropriate
computer and IS concepts together with a strong managerial emphasis on meeting business
and organizational needs.

APPROACH OF THE TEXT
Principles of Information Systems: A Managerial Approach, Ninth Edition, offers the traditional
coverage of computer concepts, but it places the material within the context of meeting
business and organizational needs. Placing information system (IS) concepts in this context
and taking a general management perspective has always set the text apart from general
computer books thus making it appealing not only to MIS majors but also to students from
other fields of study. The text isn’t overly technical, but rather deals with the role that information systems play in an organization and the key principles a manager needs to grasp
to be successful. These principles of IS are brought together and presented in a way that is
both understandable and relevant. In addition, this book offers an overview of the entire IS
discipline, while giving students a solid foundation for further study in advanced IS courses
as programming, systems analysis and design, project management, database management,
data communications, Web site and systems development, electronic commerce and mobile
xxi


commerce applications, and decision support. As such, it serves the needs of both general
business students and those who will become IS professionals.
The overall vision, framework, and pedagogy that made the previous editions so popular
have been retained in the ninth edition, offering a number of benefits to students. We continue to present IS concepts with a managerial emphasis. While the fundamental vision of
this market-leading text remains unchanged, the ninth edition more clearly highlights established principles and draws out new ones that have emerged as a result of business,
organizational, and technological change.

IS Principles First, Where They Belong
Exposing students to fundamental IS principles is an advantage for students who do not later

return to the discipline for advanced courses. Since most functional areas in business rely on
information systems, an understanding of IS principles helps students in other course work.
In addition, introducing students to the principles of information systems helps future business function managers employ information systems successfully and avoid mishaps that
often result in unfortunate consequences. Furthermore, presenting IS concepts at the introductory level creates interest among general business students who may later choose information systems as a field of concentration.

Author Team
Ralph Stair and George Reynolds have teamed up again for the ninth edition. Together, they
have more than sixty years of academic and industrial experience. Ralph Stair brings years of
writing, teaching, and academic experience to this text. He wrote numerous books and a
large number of articles while at Florida State University. George Reynolds brings a wealth
of computer and industrial experience to the project, with more than thirty years of experience
working in government, institutional, and commercial IS organizations. He has written numerous texts and has taught the introductory IS course at the University of Cincinnati and
College of Mount St. Joseph. The Stair and Reynolds team brings a solid conceptual foundation and practical IS experience to students.

GOALS OF THIS TEXT
Because Principles of Information Systems: A Managerial Approach, Ninth Edition, is written
for all business majors, we believe it is important not only to present a realistic perspective
on IS in business but also to provide students with the skills they can use to be effective
business leaders in their organization. To that end, Principles of Information Systems: A Managerial Approach, Ninth Edition, has four main goals:
1.
2.
3.
4.

To provide a core of IS principles with which every business student should be
familiar
To offer a survey of the IS discipline that will enable all business students to understand the relationship of IS courses to their curriculum as a whole
To present the changing role of the IS professional
To show the value of the discipline as an attractive field of specialization

By achieving these goals, Principles of Information Systems, Ninth Edition, will enable students,
regardless of their major, to understand and use fundamental information systems principles
so that they can function more efficiently and effectively as workers, managers, decision
makers, and organizational leaders.

IS Principles

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Principles of Information Systems: A Managerial Approach, Ninth Edition, although comprehensive, cannot cover every aspect of the rapidly changing IS discipline. The authors, having
recognized this, provide students an essential core of guiding IS principles to use as they face


the career challenges ahead. Think of principles as basic truths or rules that remain constant
regardless of the situation. As such, they provide strong guidance in the face of tough decisions. A set of IS principles is highlighted at the beginning of each chapter. The application
of these principles to solve real-world problems is driven home from the opening vignettes
to the end-of-chapter material. The ultimate goal of Principles of Information Systems is to
develop effective, thinking, action-oriented employees by instilling them with principles to
help guide their decision making and actions.

Survey of the IS Discipline
This text not only offers the traditional coverage of computer concepts but also provides a
broad framework to impart students with a solid grounding in the business uses of technology.
In addition to serving general business students, this book offers an overview of the entire IS
discipline and solidly prepares future IS professionals for advanced IS courses and their careers
in the rapidly changing IS discipline.

Changing Role of the IS Professional
As business and the IS discipline have changed, so too has the role of the IS professional.
Once considered a technical specialist, today the IS professional operates as an internal consultant to all functional areas of the organization, being knowledgeable about their needs and

competent in bringing the power of information systems to bear throughout the organization.
The IS professional views issues through a global perspective that encompasses the entire
organization and the broader industry and business environment in which it operates.
The scope of responsibilities of an IS professional today is not confined to just his/her
employer but encompasses the entire interconnected network of employees, suppliers, customers, competitors, regulatory agencies, and other entities, no matter where they are located.
This broad scope of responsibilities creates a new challenge: how to help an organization
survive in a highly interconnected, highly competitive global environment. In accepting that
challenge, the IS professional plays a pivotal role in shaping the business itself and ensuring
its success. To survive, businesses must now strive for the highest level of customer satisfaction
and loyalty through competitive prices and ever- improving product and service quality. The
IS professional assumes the critical responsibility of determining the organization’s approach
to both overall cost and quality performance and therefore plays an important role in the
ongoing survival of the organization. This new duality in the role of the IS employee—a
professional who exercises a specialist’s skills with a generalist’s perspective—is reflected
throughout the book.

IS as a Field for Further Study
Despite the downturn in the economy at the start of the 21st century, especially in
technology-related sectors, the outlook for computer and information systems managers is
optimistic. Indeed, employment of computer and information systems managers is expected
to grow much faster than the average for all occupations through the year 2012. According
to the Bureau of Labor Statistics, the number of information technology workers exceeded
4.1 million, an all-time high in the second quarter of 2008. Technological advancements
will boost the employment of computer-related workers; in turn, this will boost the demand
for managers to direct these workers. In addition, job openings will result from the need to
replace managers who retire or move into other occupations.
A career in IS can be exciting, challenging, and rewarding! It is important to show the
value of the discipline as an appealing field of study and that the IS graduate is no longer a
technical recluse. Today, perhaps more than ever before, the IS professional must be able to
align IS and organizational goals and to ensure that IS investments are justified from a business perspective. The need to draw bright and interested students into the IS discipline is

part of our ongoing responsibility. Upon graduation, IS graduates at many schools are
among the highest paid of all business graduates. Throughout this text, the many challenges
and opportunities available to IS professionals are highlighted and emphasized.
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CHANGES IN THE NINTH EDITION
We have implemented a number of exciting changes to the text based on user feedback on
how the text can be aligned even more closely with how the IS principles and concepts course
is now being taught. The following list summarizes these changes:
•

All new opening vignettes. All of the chapter-opening vignettes are new, and continue to raise actual issues from foreign-based or multinational companies.

•

All new Information Systems @ Work special interest boxes. Highlighting current
topics and trends in today’s headlines, these boxes show how information systems
are used in a variety of business career areas.

•

All new Ethical and Societal Issues special interest boxes. Focusing on ethical issues
today’s professionals face, these boxes illustrate how information systems professionals confront and react to ethical dilemmas.

•

New case studies. Two new end-of-chapter cases provide a wealth of practical information for students and instructors. Each case explores a chapter concept or
problem that a real-world company or organization has faced. The cases can be
assigned as individual homework exercises or serve as a basis for class discussion.

Each chapter has been completely updated with the latest topics and examples. The following
is a summary of the changes.

Chapter 1, An Introduction to Information Systems

xxiv

The topics and sections in Chapter 1 create a framework for the entire book. As with all
chapters, the opening material at the beginning of the chapter including the vignette, the
Information Systems @ Work and Ethical and Societal Issues special interest boxes, the endof-chapter cases, and all end-of-chapter material have been updated to reflect the changes in
Chapter 1.
This chapter continues to emphasize the benefits of an information system, including
speed, accuracy, reduced costs, and increased functionality. We have modified the last principle at the beginning of the chapter to emphasize the importance of global and international
information systems. The Why Learn About Information Systems section has been updated
to include a new example about financial advisor’s use of information systems.
In the section on data, information, and knowledge, we have included a new definition
of knowledge management system (KMS). New examples have been introduced in the section
on computer-based information systems to give students a better understanding of these
important components. The material on the Internet, for example, has been completely
updated with the latest information, including Web 2.0 technologies. References of corporate
IS usage have been stressed in the major section of business information systems.
The latest material on hardware, software, databases, telecommunications, and the Internet have been included. This material contains fresh, new examples of how organizations
use computer-based information systems to their benefit. The best corporate users of IS, as
reported by popular computer and business journals, has been explored. We continue to
stress that ERP systems can replace many applications with one unified set of programs. The
material on virtual reality includes new information on the use of this technology to design
and manufacture Boeing’s new Dreamliner 787 aircraft. The material on systems development has been updated with new examples of success and failures.
The section on ethical and social issues includes the latest threats and what is being done
to prevent them. This material contains new examples on the dangers of identity theft, computer mistakes, and power consumption and computer waste. Some experts believe that

computers waste up to half of the energy they consume and account for about 2% of worldwide energy usage. We also discuss legal actions in this section. For example, lawsuits have
been filed against YouTube and other Internet sites to protect important copyrighted material
from being posted and distributed.