FOUNDATIONS OF BUSINESS INFORMATION SYSTEMS

FOUNDATIONS OF BUSINESS INFORMATION SYSTEMS

APPROACHES TO INFORMATION TECHNOLOGY Series Editor Thomas F. Carbery, Strathclyde Business School University of Strathclyde Glasgow, Scotland Foundations of Business Information Systems Andrew Doswell

FOUNDATIONS OF BUSINESS INFORMATION SYSTEMS Andrew Doswell University of Strathclyde Glasgow. Scotland PLENUM PRESS NEW YORK AND LONDON

Library of Congress Cataloging in Publication Data Doswell, Andrew. Foundations of business information systems. (Approaches to information technology) Bibliography: p. Includes index. \. Information storage and retrieval systems - Business. 2. Business - Data processing. I. Title. II. Series. HF5548.2.D62 1985 658.4'038 85-3689 TSBN-13: 978-0-306-41796-2 e-tsbn-13: 978-1-4613-2395-2 DOT: 10.1007/978-1-4613-2395-2 1985 Plenum Press, New York Softcover reprint of the hardcover I st edition 1985 A Division of Plenum Publishing Corporation 233 Spring Street, New York, N.Y. 10013 All rights reserved No part of this book may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, microfilming, recording, or otherwise, without written permission from the Publisher

For my mother and the memory of my father

FOREWORD A few years ago there were no books on information technology and business, now there are a great many. To add to that flow calls for courage and judgment on the part of both a potential author and publisher. Andrew Doswell and Plenum Press are justified in bringing this work into the market. The main reason is that Andrew Doswell has brought to the work some simple yet formidable attributes. The first of these is that he knows what he is talking about. He was trained as an electrical engineer; he then was employed in business, drawing on and fortifying that training, where he moved into an administrative position. Later still he moved into teaching, first in Ireland, then in Scotland, but while employed in education he has not become an academic recluse. On the contrary, he has continued to maintain his links with business, doing so by engaging in both research and consultancy. Within the University he has been at the forefront of our thrust into office automation and office information systems. The second great attribute that Andrew Doswell brings to this work is that he speaks and writes in a language that ordinary men and women can understand. This is refreshing. Most writers in this area fall into one of two categories. The first group consists of advanced computer scientists and electronic engineers who are so accustomed to speaking to others of their own kind that they cannot speak about their own subjects other than in an "elitist" language or jargon, or, variant on a theme, they presuppose greater prior knowledge than most would-be students and readers possess. The other group consists of professional writers, frequently journalists, who write with lucidity but with no great understanding of the subject. The language used by Andrew Doswell in this work can be understood and followed by all, including backbench M.P.'s, trade union leaders, retired Brigadiers, junior, middle, and senior executives, and high-iq students. vii

viii Foreword o that there were yet more books on this subject that were written with such a happy combination of knowledge and lucidity! THOMAS F. CARBERY Strathclyde Business School University of Strathclyde Glasgow

PREFACE The purpose of this book is to provide an introduction to information systems in their business setting. I have tried to indicate what information technology is, and how it will impact business in terms of the products and services business provides, and the processes used to provide and support the provision of business products and services. I have assumed the reader to have no prior knowledge concerning the mechanics of business, let alone the mechanics of processing information. Therefore, ideas about both business and information processing are developed from scratch. For the reader who does know something already, there are, hopefully, enough signposts provided to indicate which parts of the book can be safely left out. All books of this kind are intended for students. There are, however, two broad groups of students. First, there are those who are actually working in business and feel the need for a book to provide some guidance as to what is going on around them. If you are one of this group, I hope to have written a book that is practical enough for your needs. In particular, Part IV deals with the uses and effects of information technology without going into the reasons Why. You may, on the other hand, belong to the second group-a full-time student with perhaps no knowledge either of business or computer-based information processing. For you I hope to have written a book. that combines an explanation of the theoretical reasons why with practical explanations of what. The material is meant to be useful to both the student specializing in either computer science or technology in general who knows nothing of business, and to the student specializing in some aspect of business who knows nothing of computers or technology. Ix

ACKNOWLEDGMENTS There are many people who help during the process of writing a book. There is the home support from wife and family and also the help from teaching colleagues who provide information. Perhaps most importantly there is the help from others who are working in the same subject area but who are not nearby. Since information technology is far beyond the comprehension of one mind I would like to take this opportunity to acknowledge the work of others-the many books and articles-which has helped me to form my understanding of business information technology. Most of these can be found in the references at the back of the book. There is another important contributor in this book-the illustrator. In this case the drawings were done by a friend, Les Lambert, who combines the ability to draw beautiful illustrations with many other talents. Usually the last, but not least, acknowledgment is reserved for the typist. In an age of information technology, that acknowledgment must disappear since the author is the word processing operator! x

CONTENTS PART I: INTRODUCTION Chapter 1: STRUCTURE... 3 Introduction............................................... 3 Structure of the Volume... 5 Chapter 2: PREVIEW... 7 Introduction............................................... 7 Business Applications of Information Technology... 7 Activity Systems: Concepts.................................. 11 Activity Systems: Applications............................... 14 Summary... 16 Discussion Questions... 17 PART II: BUSINESS AND INFORMATION Chapter 3: FUNCTIONS, COMMUNICATION, AND ORGANIZATION... 21 Introduction............................................... 21 Functions................................................. 22 Organization... 30 Communication............................................ 35 Exercise................................................... 39 Summary... 45 Discussion Questions... 47 xi

xii Contents Chapter 4: INFORMATION, DECISIONS, PRODUCTS, AND PROCESSES... 49 Introduction............................................... 49 Semiotics... 52 The Properties of Signs.................................... 53 Decisions... 56 The Information Activity Block.............................. 62 Information Products and Services... 66 Summary... 78 Discussion Questions... 79 PART III: INFORMATION TECHNOLOGY Chapter 5: TRADITIONAL TECHNOLOGY... 83 Introduction............................................... 83 Human Information Technology... 85 Information Technology Products and Services... 95 Summary... 98 Discussion Questions... 98 Chapter 6: PRINCIPLES OF NEW INFORMATION TECHNOLOGY... 99 Introduction............................................... 99 Solid Switches... 103 Computer Operation... 108 Communication... 113 Summary... 122 Discussion Questions... 122 Chapter 7: THE INFORMATION MACHINE... 123 Introduction... 123 The Processor... 123 Storage... 125 Communication Devices... 132 Summary...,... '"... "... 157 Discussion Questions... 158 PART IV: BUSINESS INFORMATION TECHNOLOGY Chapter 8: APPLICATIONS... 161 Introduction... 161 Products... 164 Services... 170 Production Processes... 183

Contents xiii Information Processes... 191 Discussion Questions... 200 Chapter 9: REVIEW... 203 Introduction... 203 Topics... 204 Discussion Questions...,... 211 References... 213 Further Reading... 214 Index.... '... 217