Paul Gray is Professor Emeritus of Information Science at Claremont Graduate University and is a distinguished scholar in the discipline, with research focusing on decision support systems and data warehousing.  He received his PhD from Stanford University.  Gray worked for 18 years in research and development organizations, including 9 years at Stanford Research Institute.  He is a past president of The Institute of Management Sciences, a predecessor of INFORMS.  Gray is currently editor of the Communications of AIS as well as on the editorial boards of seven other professional journals.  He has written 13 books and 85 scientific articles.

• Chapter 1 What Is An Information System? 1Managerial Questions 1Introduction 1What is an Information System? 2Components of an Information System 2Hardware 3Personal Computers 3Mainframe Computers 3Client–Server Computers 4Remote Computing Using Application Service Providers, Web Services, and Grid Computing 4Software 5Operating Systems 5Applications Programs 5Electronic Commerce (Chapter 3) 7ERP (Enterprise Requirements Planning) (Chapter 4) 7Data Warehousing (Chapter 5) 8Customer Relationship Management (Chapter 6) 8Knowledge Management (Chapter 7) 9Business Intelligence (Chapter 8) 10The Internet 11Websites 11Connectivity 11Finding Things Using Search Engines 12Content Management 12Intranet/Extranet 12Privacy 12Security 12Corporate Portals 13Website Development 13Website Traffic Analysis 13Answers to Managerial Questions 14Chapter 2 the Big Picture: It and Business 15Managerial Questions 15Introduction 15Strategic Advantage Versus Strategic Necessity 15Continual Improvement 17Introducing Strategic Information Systems 17Risks 19Business–it Alignment 20Assessing the Alignment Maturity Level 21Alignment Considerations 21Alignment when Strategy Changes 21Information Economics 23The Search for Productivity 23Why Invest? 25Organizational Change 25Some Practical Problems 26Does Information Technology Matter? 26Carr’s Argument 26The Response to Carr 27This Book’s Position 27The Arguments for Carr 27The Arguments against Carr’s Position 28Types of Information Systems 29Transaction Processing Systems 29Management Information Systems 30Decision Support Systems 30Knowledge-Based and Other Systems 30Interorganizational Computing 30Replacing Intermediation through Electronic Markets 31Key Issues 32Application and Technology Developments 34Answers to Managerial Questions 35Problems 36Chapter 3 Electronic Commerce 37Managerial Questions 37Introduction 37What is Involved in E-commerce? 39Some E-commerce Statistics 39Retail 40Business to Business (B2B) 40Technology 40Benefits and Costs 41Benefits 41Costs 41Business to Consumer (B2C) 43Infrastructure 43Electronic Retail Business Model 44Information Transactions 45Advertising 45Impact on Retail Distribution 46B2C in Service Industries 46Cybermalls and Metamalls 47Business to Business (B2B) 47Structure of the E-marketplace 48Electronic Data Interchange (EDI) 48Moving to the Internet 48Interorganizational Systems 48Electronic Markets 50Consumer to Consumer (C2C): The Case of Ebay 52Consumer to Government (C2G): The Case of Wireless and 911 53E-commerce Strategies 53Conclusions 55Answers to Managerial Questions 55Problems 56Chapter 4 Enterprise Requirements Planning 58Managerial Questions 58Introduction 58How Sap Works 59Cultural Problems of Implementation 61ERP Vendors 62Costs 62Benefits 64The Markus and Tanis View of the ERP Experience 64Integration 65Packages 65Best Practices 65Some Assembly Required 65Reasons for Adopting or Not Adopting ERP 66Adopting ERP 66Not Adopting ERP 66The ERP Team 67The Future: ERP II 71Final Thoughts 71Answers to Managerial Questions 72Problems 73Chapter 5 Data Warehousing 74Managerial Questions 74Introduction 74Definition of a Data Warehouse 75Characteristics of a Data Warehouse 75Subject Orientation 76Data Integration 77Time 78Nonvolatile Data 78Structure of the Data Warehouse 79Metadata 80Flow of Data 81Why a Separate Warehouse? 81Other Forms of Data Warehouses 82Application: Online Analytic Processing 84Application: Data Mining 86Application: Customer Relationship Management 87Application: Business Intelligence 88Strategic Use 89Managing the Data Warehouse 90Why Warehouse Projects Can Fail 92Data Warehousing Costs 93The Data Warehousing Industry 94Benefits and Problems 94Answers to Managerial Questions 94Problems 95Chapter 6 Customer Relationship Management 96Managerial Questions 96Introduction 96History of the CRM Market 97The CRM Approach 99Basic Assumptions of CRM 99Customer 100Relationship 100Management 100Drivers for CRM Applications 102Revenue and Cost Goals 103Principles of CRM 103Technology and Service 104Information Technologies for CRM 104Key Tasks 104IT Factors of CRM 105Consultants 106Return on Investment of Implementation 106Cost and Time 106Benefits 107ROI of CRM Project 108CRM Issues 109Customer Privacy 109Technical Immaturity 109CRM Myths 110The Importance of Channels 111Vendors 111Management Risks 112Conclusions 115Answers to Managerial Questions 115Problems 115Chapter 7 Knowledge Management 117Managerial Questions 117Introduction 117Claims 118Role of Information Technology 118Principles of Knowledge Management 119Knowledge Strategies 120Leverage 120Fragmentation, Leakage, Refreshment 120Uncertain Value 120Uncertainty in Value Sharing 121Implications 121Tacit Versus Explicit Knowledge 121A Hierarchy of Knowledge 123Generating Knowledge 123Knowledge Acquisition 124Dedicated Resources 125Fusion 126Adaptation 127Networks 127Transferring Knowledge 127Personnel Issues 128Km as an Industry 129Technology 130When Knowledge Management Makes Sense 134Answers to Managerial Questions 135Problems 136Chapter 8 Business Intelligence 137Managerial Questions 137Introduction 137Definition 137Relation to other Software 138What Can BI Do? 138BI Technology 140OLAP 144Other Data Sources 147Example: Competitive Intelligence 148Example: Financial Analytics 150Potential and Shortcomings 150Return on Investment 151Building a Business Intelligence System 152The Business Intelligence Industry 153Emerging Ideas in Business Intelligence 155BI Everywhere 155Business Process Management and Business Activity Monitoring 156Answers to Managerial Questions 158Problems 159Chapter 9 Outsourcing and Its Variations: Letting Someone else Do the Work 161Managerial Questions 161Introduction 161Origins of Outsourcing 162Offshore Outsourcing 162Outsourcing Considerations 164A Typical Domestic Large Outsourcing Project 164The Size of the Outsourcing Market 165Why Outsource? 165The Central Role of the Contract 166Managing the Outsourcer Once the Contract Is Signed 167Controls 169Bottom Line on Outsourcing 170Outsourcing the Infrastructure: Web Hosting Service Providers, Web Services, and Utility Computing 170The Outsourcers 171Web Hosting 171Service Providers (xSPs) 171Rationale 172Should You Hire an xSP? 173Web Services 173Definition and Implication of Web Services 174Running Computing as a Utility 176Why Do It? 176Implementing the Utility Approach 176Stages of Utility Computing 176Alternative Approaches 177Risks of ASPs and Utilities 177Answers to Managerial Issues 180Problems 181Chapter 10 Working Together: Systems Integration, Interorganizational Systems, Alliances, and Globalization 182Managerial Questions 182Introduction 182Systems Integration 183Definition 183Objective 184The Concept 184Integrating the Enterprise 184Integrating the Technology 185Integration of Data, Application, and Processes 185Aspects of Systems Integration 188Enterprise Computing 188Lessons Learned from Experience 189The Systems Integration Industry 189Management Strategy for Integration 190Interorganizational Systems 191Readiness 192Control 192Who Benefits? 194Alliances 194Globalization 194Bringing in Immigrants, Moving Work Abroad 196Privacy Rules and Transborder Data Flows 196Answers to Managerial Questions 198Problems 199Chapter 11 Is in Managing Business Operations: the Supply Chain 200Managerial Questions 200Introduction 200The Supply Chain 201Software’s Role 202Why Install Supply Chain Software? 203Cooperation 203Manufacturing 204Overview 204Cad 204Cam 205Just-in-Time Manufacturing 205Inventory 206Role of ERP 207Role of Data Warehousing 207Challenges to Implementation 208Other Problems Along the Supply Chain 209Demand Forecasting 209What Is the Payoff From Information Systems In the Supply Chain? 210Returns 213The Supply Chain Market 213Major Firms in the Supply Chain Market 214Answers to Managerial Questions 215Problems 215Chapter 12 The Chief Information Officer, People Issues, Project Management, Change Management 216Managerial Questions 216Introduction 216Chief Information Officer 217Managing Expectations 217Chief Technology Officer 218Governance and Steering Committees 219What Is People Need to Know 219Create Programs 220Manage Vendors and Outsourcers 220Customize Programs to the Firm’s Needs 220Know the Needs of the Business 220Business Processes 220Communicating with the User Community 221Maintaining the Corporate Data 221Maintaining Corporate Telecommunications 221Integrating Systems 221Managing E-mail and Internet Usage 222Managing the Firm’s Web Presence 222Managing Computer Security 222Documentation, Updates, and Training 222Maintaining and Running the Computers 223Help Desk 223Role of Educational Institutions 224Project Management 224The Project Manager 226Change Management 227Conclusions 229Answers to Managerial Questions 229Problems 230Chapter 13 Information Systems in Mergers and Acquisitions 231Managerial Questions 231Introduction 231Why Merge? 231Effect of Merger on Information Systems 232Merger Principles 233The Merger Process 233Security Issues 234Cultural Considerations 235Implications of Cases 237Answers to Managerial Questions 237Problems 238Chapter 14 Work Systems and Infrastructure 239Managerial Questions 239Introduction 239Work System 240Infrastructure 241What Is Infrastructure? 241The Infrastructure Portfolio 243Infrastructure Architecture 244Infrastructure Investment Strategies 244Making Infrastructure Investment Decisions 245Infrastructure Capabilities 246Work Systems 246Fundamental Concepts of Work Systems 247Relations among the Concepts 249Technical Considerations for IS Work System Projects 253Answers to Managerial Questions 254Problems 255Chapter 15 Privacy, Security, Copyright, Patents, and other Legal And Ethical Issues 256Managerial Questions 256Introduction 256Privacy 257Privacy Statements 258Surveillance 259Privacy versus Convenience 261CRM, Data Warehousing, and Other Large Databases 261Security 261Controls 262New Technologies 264The Risk of Not Investing 264Risk Management 264HIPAA: the Intersection of Security and Privacy 265Announcing Security Failures 266Disaster Recovery and Business Continuity 266An Example 267Who Is Responsible? 267The Threats 267Some IT Measures 267Some Lessons 268Legal Issues 268Privacy 269Taxation of E-commerce 269UCITA 270Copyright and Patents 271Copyright 271Patents 272Ethics 272Answers to Managerial Questions 274Appendix: the Computer Industry 277Managerial Questions 277Definition of the Information Industry 277U.S. Census Bureau 278Shapiro and Varian 278Hoover’s Online 278A Framework for Analyzing the Information Industry— The Houghton Map 279Computer and Computer-related Segments 281In-house Computer Shops 282Employment 283Outside Shops 285Application Service Providers 285Web Services 287Outsourcers 287Hardware Manufacturers 290Retailers and Middlemen 291Pricing and Maintenance 291Open Source 292Computing for Nonbusiness Applications 292Telecommunications and Networks 292Search Engines 293New Technologies 293Wi-Fi 294RFID 294Finding Out More About the Computer Industry and Computer Applications: the Computer Press and the Industry Observers 295Conclusion 296Answers to Managerial Questions 296Glossary 299Index 313

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Paul Gray is Professor Emeritus of Information Science at Claremont Graduate University and is a distinguished scholar in the discipline, with research focusing on decision support systems and data warehousing.  He received his PhD from Stanford University.  Gray worked for 18 years in research and development organizations, including 9 years at Stanford Research Institute.  He is a past president of The Institute of Management Sciences, a predecessor of INFORMS.  Gray is currently editor of the Communications of AIS as well as on the editorial boards of seven other professional journals.  He has written 13 books and 85 scientific articles.

• Chapter 1 What Is An Information System? 1Managerial Questions 1Introduction 1What is an Information System? 2Components of an Information System 2Hardware 3Personal Computers 3Mainframe Computers 3Client–Server Computers 4Remote Computing Using Application Service Providers, Web Services, and Grid Computing 4Software 5Operating Systems 5Applications Programs 5Electronic Commerce (Chapter 3) 7ERP (Enterprise Requirements Planning) (Chapter 4) 7Data Warehousing (Chapter 5) 8Customer Relationship Management (Chapter 6) 8Knowledge Management (Chapter 7) 9Business Intelligence (Chapter 8) 10The Internet 11Websites 11Connectivity 11Finding Things Using Search Engines 12Content Management 12Intranet/Extranet 12Privacy 12Security 12Corporate Portals 13Website Development 13Website Traffic Analysis 13Answers to Managerial Questions 14Chapter 2 the Big Picture: It and Business 15Managerial Questions 15Introduction 15Strategic Advantage Versus Strategic Necessity 15Continual Improvement 17Introducing Strategic Information Systems 17Risks 19Business–it Alignment 20Assessing the Alignment Maturity Level 21Alignment Considerations 21Alignment when Strategy Changes 21Information Economics 23The Search for Productivity 23Why Invest? 25Organizational Change 25Some Practical Problems 26Does Information Technology Matter? 26Carr’s Argument 26The Response to Carr 27This Book’s Position 27The Arguments for Carr 27The Arguments against Carr’s Position 28Types of Information Systems 29Transaction Processing Systems 29Management Information Systems 30Decision Support Systems 30Knowledge-Based and Other Systems 30Interorganizational Computing 30Replacing Intermediation through Electronic Markets 31Key Issues 32Application and Technology Developments 34Answers to Managerial Questions 35Problems 36Chapter 3 Electronic Commerce 37Managerial Questions 37Introduction 37What is Involved in E-commerce? 39Some E-commerce Statistics 39Retail 40Business to Business (B2B) 40Technology 40Benefits and Costs 41Benefits 41Costs 41Business to Consumer (B2C) 43Infrastructure 43Electronic Retail Business Model 44Information Transactions 45Advertising 45Impact on Retail Distribution 46B2C in Service Industries 46Cybermalls and Metamalls 47Business to Business (B2B) 47Structure of the E-marketplace 48Electronic Data Interchange (EDI) 48Moving to the Internet 48Interorganizational Systems 48Electronic Markets 50Consumer to Consumer (C2C): The Case of Ebay 52Consumer to Government (C2G): The Case of Wireless and 911 53E-commerce Strategies 53Conclusions 55Answers to Managerial Questions 55Problems 56Chapter 4 Enterprise Requirements Planning 58Managerial Questions 58Introduction 58How Sap Works 59Cultural Problems of Implementation 61ERP Vendors 62Costs 62Benefits 64The Markus and Tanis View of the ERP Experience 64Integration 65Packages 65Best Practices 65Some Assembly Required 65Reasons for Adopting or Not Adopting ERP 66Adopting ERP 66Not Adopting ERP 66The ERP Team 67The Future: ERP II 71Final Thoughts 71Answers to Managerial Questions 72Problems 73Chapter 5 Data Warehousing 74Managerial Questions 74Introduction 74Definition of a Data Warehouse 75Characteristics of a Data Warehouse 75Subject Orientation 76Data Integration 77Time 78Nonvolatile Data 78Structure of the Data Warehouse 79Metadata 80Flow of Data 81Why a Separate Warehouse? 81Other Forms of Data Warehouses 82Application: Online Analytic Processing 84Application: Data Mining 86Application: Customer Relationship Management 87Application: Business Intelligence 88Strategic Use 89Managing the Data Warehouse 90Why Warehouse Projects Can Fail 92Data Warehousing Costs 93The Data Warehousing Industry 94Benefits and Problems 94Answers to Managerial Questions 94Problems 95Chapter 6 Customer Relationship Management 96Managerial Questions 96Introduction 96History of the CRM Market 97The CRM Approach 99Basic Assumptions of CRM 99Customer 100Relationship 100Management 100Drivers for CRM Applications 102Revenue and Cost Goals 103Principles of CRM 103Technology and Service 104Information Technologies for CRM 104Key Tasks 104IT Factors of CRM 105Consultants 106Return on Investment of Implementation 106Cost and Time 106Benefits 107ROI of CRM Project 108CRM Issues 109Customer Privacy 109Technical Immaturity 109CRM Myths 110The Importance of Channels 111Vendors 111Management Risks 112Conclusions 115Answers to Managerial Questions 115Problems 115Chapter 7 Knowledge Management 117Managerial Questions 117Introduction 117Claims 118Role of Information Technology 118Principles of Knowledge Management 119Knowledge Strategies 120Leverage 120Fragmentation, Leakage, Refreshment 120Uncertain Value 120Uncertainty in Value Sharing 121Implications 121Tacit Versus Explicit Knowledge 121A Hierarchy of Knowledge 123Generating Knowledge 123Knowledge Acquisition 124Dedicated Resources 125Fusion 126Adaptation 127Networks 127Transferring Knowledge 127Personnel Issues 128Km as an Industry 129Technology 130When Knowledge Management Makes Sense 134Answers to Managerial Questions 135Problems 136Chapter 8 Business Intelligence 137Managerial Questions 137Introduction 137Definition 137Relation to other Software 138What Can BI Do? 138BI Technology 140OLAP 144Other Data Sources 147Example: Competitive Intelligence 148Example: Financial Analytics 150Potential and Shortcomings 150Return on Investment 151Building a Business Intelligence System 152The Business Intelligence Industry 153Emerging Ideas in Business Intelligence 155BI Everywhere 155Business Process Management and Business Activity Monitoring 156Answers to Managerial Questions 158Problems 159Chapter 9 Outsourcing and Its Variations: Letting Someone else Do the Work 161Managerial Questions 161Introduction 161Origins of Outsourcing 162Offshore Outsourcing 162Outsourcing Considerations 164A Typical Domestic Large Outsourcing Project 164The Size of the Outsourcing Market 165Why Outsource? 165The Central Role of the Contract 166Managing the Outsourcer Once the Contract Is Signed 167Controls 169Bottom Line on Outsourcing 170Outsourcing the Infrastructure: Web Hosting Service Providers, Web Services, and Utility Computing 170The Outsourcers 171Web Hosting 171Service Providers (xSPs) 171Rationale 172Should You Hire an xSP? 173Web Services 173Definition and Implication of Web Services 174Running Computing as a Utility 176Why Do It? 176Implementing the Utility Approach 176Stages of Utility Computing 176Alternative Approaches 177Risks of ASPs and Utilities 177Answers to Managerial Issues 180Problems 181Chapter 10 Working Together: Systems Integration, Interorganizational Systems, Alliances, and Globalization 182Managerial Questions 182Introduction 182Systems Integration 183Definition 183Objective 184The Concept 184Integrating the Enterprise 184Integrating the Technology 185Integration of Data, Application, and Processes 185Aspects of Systems Integration 188Enterprise Computing 188Lessons Learned from Experience 189The Systems Integration Industry 189Management Strategy for Integration 190Interorganizational Systems 191Readiness 192Control 192Who Benefits? 194Alliances 194Globalization 194Bringing in Immigrants, Moving Work Abroad 196Privacy Rules and Transborder Data Flows 196Answers to Managerial Questions 198Problems 199Chapter 11 Is in Managing Business Operations: the Supply Chain 200Managerial Questions 200Introduction 200The Supply Chain 201Software’s Role 202Why Install Supply Chain Software? 203Cooperation 203Manufacturing 204Overview 204Cad 204Cam 205Just-in-Time Manufacturing 205Inventory 206Role of ERP 207Role of Data Warehousing 207Challenges to Implementation 208Other Problems Along the Supply Chain 209Demand Forecasting 209What Is the Payoff From Information Systems In the Supply Chain? 210Returns 213The Supply Chain Market 213Major Firms in the Supply Chain Market 214Answers to Managerial Questions 215Problems 215Chapter 12 The Chief Information Officer, People Issues, Project Management, Change Management 216Managerial Questions 216Introduction 216Chief Information Officer 217Managing Expectations 217Chief Technology Officer 218Governance and Steering Committees 219What Is People Need to Know 219Create Programs 220Manage Vendors and Outsourcers 220Customize Programs to the Firm’s Needs 220Know the Needs of the Business 220Business Processes 220Communicating with the User Community 221Maintaining the Corporate Data 221Maintaining Corporate Telecommunications 221Integrating Systems 221Managing E-mail and Internet Usage 222Managing the Firm’s Web Presence 222Managing Computer Security 222Documentation, Updates, and Training 222Maintaining and Running the Computers 223Help Desk 223Role of Educational Institutions 224Project Management 224The Project Manager 226Change Management 227Conclusions 229Answers to Managerial Questions 229Problems 230Chapter 13 Information Systems in Mergers and Acquisitions 231Managerial Questions 231Introduction 231Why Merge? 231Effect of Merger on Information Systems 232Merger Principles 233The Merger Process 233Security Issues 234Cultural Considerations 235Implications of Cases 237Answers to Managerial Questions 237Problems 238Chapter 14 Work Systems and Infrastructure 239Managerial Questions 239Introduction 239Work System 240Infrastructure 241What Is Infrastructure? 241The Infrastructure Portfolio 243Infrastructure Architecture 244Infrastructure Investment Strategies 244Making Infrastructure Investment Decisions 245Infrastructure Capabilities 246Work Systems 246Fundamental Concepts of Work Systems 247Relations among the Concepts 249Technical Considerations for IS Work System Projects 253Answers to Managerial Questions 254Problems 255Chapter 15 Privacy, Security, Copyright, Patents, and other Legal And Ethical Issues 256Managerial Questions 256Introduction 256Privacy 257Privacy Statements 258Surveillance 259Privacy versus Convenience 261CRM, Data Warehousing, and Other Large Databases 261Security 261Controls 262New Technologies 264The Risk of Not Investing 264Risk Management 264HIPAA: the Intersection of Security and Privacy 265Announcing Security Failures 266Disaster Recovery and Business Continuity 266An Example 267Who Is Responsible? 267The Threats 267Some IT Measures 267Some Lessons 268Legal Issues 268Privacy 269Taxation of E-commerce 269UCITA 270Copyright and Patents 271Copyright 271Patents 272Ethics 272Answers to Managerial Questions 274Appendix: the Computer Industry 277Managerial Questions 277Definition of the Information Industry 277U.S. Census Bureau 278Shapiro and Varian 278Hoover’s Online 278A Framework for Analyzing the Information Industry— The Houghton Map 279Computer and Computer-related Segments 281In-house Computer Shops 282Employment 283Outside Shops 285Application Service Providers 285Web Services 287Outsourcers 287Hardware Manufacturers 290Retailers and Middlemen 291Pricing and Maintenance 291Open Source 292Computing for Nonbusiness Applications 292Telecommunications and Networks 292Search Engines 293New Technologies 293Wi-Fi 294RFID 294Finding Out More About the Computer Industry and Computer Applications: the Computer Press and the Industry Observers 295Conclusion 296Answers to Managerial Questions 296Glossary 299Index 313

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Paul Gray is Professor Emeritus of Information Science at Claremont Graduate University and is a distinguished scholar in the discipline, with research focusing on decision support systems and data warehousing.  He received his PhD from Stanford University.  Gray worked for 18 years in research and development organizations, including 9 years at Stanford Research Institute.  He is a past president of The Institute of Management Sciences, a predecessor of INFORMS.  Gray is currently editor of the Communications of AIS as well as on the editorial boards of seven other professional journals.  He has written 13 books and 85 scientific articles.

• Chapter 1 What Is An Information System? 1Managerial Questions 1Introduction 1What is an Information System? 2Components of an Information System 2Hardware 3Personal Computers 3Mainframe Computers 3Client–Server Computers 4Remote Computing Using Application Service Providers, Web Services, and Grid Computing 4Software 5Operating Systems 5Applications Programs 5Electronic Commerce (Chapter 3) 7ERP (Enterprise Requirements Planning) (Chapter 4) 7Data Warehousing (Chapter 5) 8Customer Relationship Management (Chapter 6) 8Knowledge Management (Chapter 7) 9Business Intelligence (Chapter 8) 10The Internet 11Websites 11Connectivity 11Finding Things Using Search Engines 12Content Management 12Intranet/Extranet 12Privacy 12Security 12Corporate Portals 13Website Development 13Website Traffic Analysis 13Answers to Managerial Questions 14Chapter 2 the Big Picture: It and Business 15Managerial Questions 15Introduction 15Strategic Advantage Versus Strategic Necessity 15Continual Improvement 17Introducing Strategic Information Systems 17Risks 19Business–it Alignment 20Assessing the Alignment Maturity Level 21Alignment Considerations 21Alignment when Strategy Changes 21Information Economics 23The Search for Productivity 23Why Invest? 25Organizational Change 25Some Practical Problems 26Does Information Technology Matter? 26Carr’s Argument 26The Response to Carr 27This Book’s Position 27The Arguments for Carr 27The Arguments against Carr’s Position 28Types of Information Systems 29Transaction Processing Systems 29Management Information Systems 30Decision Support Systems 30Knowledge-Based and Other Systems 30Interorganizational Computing 30Replacing Intermediation through Electronic Markets 31Key Issues 32Application and Technology Developments 34Answers to Managerial Questions 35Problems 36Chapter 3 Electronic Commerce 37Managerial Questions 37Introduction 37What is Involved in E-commerce? 39Some E-commerce Statistics 39Retail 40Business to Business (B2B) 40Technology 40Benefits and Costs 41Benefits 41Costs 41Business to Consumer (B2C) 43Infrastructure 43Electronic Retail Business Model 44Information Transactions 45Advertising 45Impact on Retail Distribution 46B2C in Service Industries 46Cybermalls and Metamalls 47Business to Business (B2B) 47Structure of the E-marketplace 48Electronic Data Interchange (EDI) 48Moving to the Internet 48Interorganizational Systems 48Electronic Markets 50Consumer to Consumer (C2C): The Case of Ebay 52Consumer to Government (C2G): The Case of Wireless and 911 53E-commerce Strategies 53Conclusions 55Answers to Managerial Questions 55Problems 56Chapter 4 Enterprise Requirements Planning 58Managerial Questions 58Introduction 58How Sap Works 59Cultural Problems of Implementation 61ERP Vendors 62Costs 62Benefits 64The Markus and Tanis View of the ERP Experience 64Integration 65Packages 65Best Practices 65Some Assembly Required 65Reasons for Adopting or Not Adopting ERP 66Adopting ERP 66Not Adopting ERP 66The ERP Team 67The Future: ERP II 71Final Thoughts 71Answers to Managerial Questions 72Problems 73Chapter 5 Data Warehousing 74Managerial Questions 74Introduction 74Definition of a Data Warehouse 75Characteristics of a Data Warehouse 75Subject Orientation 76Data Integration 77Time 78Nonvolatile Data 78Structure of the Data Warehouse 79Metadata 80Flow of Data 81Why a Separate Warehouse? 81Other Forms of Data Warehouses 82Application: Online Analytic Processing 84Application: Data Mining 86Application: Customer Relationship Management 87Application: Business Intelligence 88Strategic Use 89Managing the Data Warehouse 90Why Warehouse Projects Can Fail 92Data Warehousing Costs 93The Data Warehousing Industry 94Benefits and Problems 94Answers to Managerial Questions 94Problems 95Chapter 6 Customer Relationship Management 96Managerial Questions 96Introduction 96History of the CRM Market 97The CRM Approach 99Basic Assumptions of CRM 99Customer 100Relationship 100Management 100Drivers for CRM Applications 102Revenue and Cost Goals 103Principles of CRM 103Technology and Service 104Information Technologies for CRM 104Key Tasks 104IT Factors of CRM 105Consultants 106Return on Investment of Implementation 106Cost and Time 106Benefits 107ROI of CRM Project 108CRM Issues 109Customer Privacy 109Technical Immaturity 109CRM Myths 110The Importance of Channels 111Vendors 111Management Risks 112Conclusions 115Answers to Managerial Questions 115Problems 115Chapter 7 Knowledge Management 117Managerial Questions 117Introduction 117Claims 118Role of Information Technology 118Principles of Knowledge Management 119Knowledge Strategies 120Leverage 120Fragmentation, Leakage, Refreshment 120Uncertain Value 120Uncertainty in Value Sharing 121Implications 121Tacit Versus Explicit Knowledge 121A Hierarchy of Knowledge 123Generating Knowledge 123Knowledge Acquisition 124Dedicated Resources 125Fusion 126Adaptation 127Networks 127Transferring Knowledge 127Personnel Issues 128Km as an Industry 129Technology 130When Knowledge Management Makes Sense 134Answers to Managerial Questions 135Problems 136Chapter 8 Business Intelligence 137Managerial Questions 137Introduction 137Definition 137Relation to other Software 138What Can BI Do? 138BI Technology 140OLAP 144Other Data Sources 147Example: Competitive Intelligence 148Example: Financial Analytics 150Potential and Shortcomings 150Return on Investment 151Building a Business Intelligence System 152The Business Intelligence Industry 153Emerging Ideas in Business Intelligence 155BI Everywhere 155Business Process Management and Business Activity Monitoring 156Answers to Managerial Questions 158Problems 159Chapter 9 Outsourcing and Its Variations: Letting Someone else Do the Work 161Managerial Questions 161Introduction 161Origins of Outsourcing 162Offshore Outsourcing 162Outsourcing Considerations 164A Typical Domestic Large Outsourcing Project 164The Size of the Outsourcing Market 165Why Outsource? 165The Central Role of the Contract 166Managing the Outsourcer Once the Contract Is Signed 167Controls 169Bottom Line on Outsourcing 170Outsourcing the Infrastructure: Web Hosting Service Providers, Web Services, and Utility Computing 170The Outsourcers 171Web Hosting 171Service Providers (xSPs) 171Rationale 172Should You Hire an xSP? 173Web Services 173Definition and Implication of Web Services 174Running Computing as a Utility 176Why Do It? 176Implementing the Utility Approach 176Stages of Utility Computing 176Alternative Approaches 177Risks of ASPs and Utilities 177Answers to Managerial Issues 180Problems 181Chapter 10 Working Together: Systems Integration, Interorganizational Systems, Alliances, and Globalization 182Managerial Questions 182Introduction 182Systems Integration 183Definition 183Objective 184The Concept 184Integrating the Enterprise 184Integrating the Technology 185Integration of Data, Application, and Processes 185Aspects of Systems Integration 188Enterprise Computing 188Lessons Learned from Experience 189The Systems Integration Industry 189Management Strategy for Integration 190Interorganizational Systems 191Readiness 192Control 192Who Benefits? 194Alliances 194Globalization 194Bringing in Immigrants, Moving Work Abroad 196Privacy Rules and Transborder Data Flows 196Answers to Managerial Questions 198Problems 199Chapter 11 Is in Managing Business Operations: the Supply Chain 200Managerial Questions 200Introduction 200The Supply Chain 201Software’s Role 202Why Install Supply Chain Software? 203Cooperation 203Manufacturing 204Overview 204Cad 204Cam 205Just-in-Time Manufacturing 205Inventory 206Role of ERP 207Role of Data Warehousing 207Challenges to Implementation 208Other Problems Along the Supply Chain 209Demand Forecasting 209What Is the Payoff From Information Systems In the Supply Chain? 210Returns 213The Supply Chain Market 213Major Firms in the Supply Chain Market 214Answers to Managerial Questions 215Problems 215Chapter 12 The Chief Information Officer, People Issues, Project Management, Change Management 216Managerial Questions 216Introduction 216Chief Information Officer 217Managing Expectations 217Chief Technology Officer 218Governance and Steering Committees 219What Is People Need to Know 219Create Programs 220Manage Vendors and Outsourcers 220Customize Programs to the Firm’s Needs 220Know the Needs of the Business 220Business Processes 220Communicating with the User Community 221Maintaining the Corporate Data 221Maintaining Corporate Telecommunications 221Integrating Systems 221Managing E-mail and Internet Usage 222Managing the Firm’s Web Presence 222Managing Computer Security 222Documentation, Updates, and Training 222Maintaining and Running the Computers 223Help Desk 223Role of Educational Institutions 224Project Management 224The Project Manager 226Change Management 227Conclusions 229Answers to Managerial Questions 229Problems 230Chapter 13 Information Systems in Mergers and Acquisitions 231Managerial Questions 231Introduction 231Why Merge? 231Effect of Merger on Information Systems 232Merger Principles 233The Merger Process 233Security Issues 234Cultural Considerations 235Implications of Cases 237Answers to Managerial Questions 237Problems 238Chapter 14 Work Systems and Infrastructure 239Managerial Questions 239Introduction 239Work System 240Infrastructure 241What Is Infrastructure? 241The Infrastructure Portfolio 243Infrastructure Architecture 244Infrastructure Investment Strategies 244Making Infrastructure Investment Decisions 245Infrastructure Capabilities 246Work Systems 246Fundamental Concepts of Work Systems 247Relations among the Concepts 249Technical Considerations for IS Work System Projects 253Answers to Managerial Questions 254Problems 255Chapter 15 Privacy, Security, Copyright, Patents, and other Legal And Ethical Issues 256Managerial Questions 256Introduction 256Privacy 257Privacy Statements 258Surveillance 259Privacy versus Convenience 261CRM, Data Warehousing, and Other Large Databases 261Security 261Controls 262New Technologies 264The Risk of Not Investing 264Risk Management 264HIPAA: the Intersection of Security and Privacy 265Announcing Security Failures 266Disaster Recovery and Business Continuity 266An Example 267Who Is Responsible? 267The Threats 267Some IT Measures 267Some Lessons 268Legal Issues 268Privacy 269Taxation of E-commerce 269UCITA 270Copyright and Patents 271Copyright 271Patents 272Ethics 272Answers to Managerial Questions 274Appendix: the Computer Industry 277Managerial Questions 277Definition of the Information Industry 277U.S. Census Bureau 278Shapiro and Varian 278Hoover’s Online 278A Framework for Analyzing the Information Industry— The Houghton Map 279Computer and Computer-related Segments 281In-house Computer Shops 282Employment 283Outside Shops 285Application Service Providers 285Web Services 287Outsourcers 287Hardware Manufacturers 290Retailers and Middlemen 291Pricing and Maintenance 291Open Source 292Computing for Nonbusiness Applications 292Telecommunications and Networks 292Search Engines 293New Technologies 293Wi-Fi 294RFID 294Finding Out More About the Computer Industry and Computer Applications: the Computer Press and the Industry Observers 295Conclusion 296Answers to Managerial Questions 296Glossary 299Index 313

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