E-business categories of business Information systems

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CATEGORIES OF BUSINESS INFORMATION SYSTEM
Information systems are commonly divided into two broad categories: systems that support an organisation’s business activities and systems that support managerial decision making.

•  Operations information systems are generally concerned with process control, transaction processing, communications (internal and external) and productivity
•  Management information systems provide feedback on organisational activities and help to support managerial decision making. Managerial decision making can occur at theoperational, tactical and strategic levels of an organisation.

As shown in Table 2.1, both of these broader categories can be subdivided into a number of additional categories. The following sections introduce these types of system. They are described in more detail later . Figure 2.7 also illustrates the typical use of each category of computer-based information system by management level. Note that the categories given here represent a traditional view of computer-based information systems and tend to downplay the growing importance of new and emerging types of information systems, many of which might not fit neatly into the table. As an example, some people feel that systems based around the use of the Internet should be given their own category. The next section considers the concepts of e-business and e-commerce.

E-BUSINESS SYSTEMS
E-business
The term e-business is credited to former IBM CEO Lou Gerstner, who is said to have coined the term in 1997. E-business can be described as using ICT, especially the Internet, to conduct business. IBM defines e-business like this: The process of using Web technology to help businesses streamline processes, improve productivity and increase efficiencies. Enables companies to easily communicate with partners, vendors and customers, connect back-end data systems and transact commerce in   a secure manner.

As this definition shows, e-business involves several key activities: improving business processes, enhancing communications and providing the means to carry out business transactions securely. Three areas of business are enhanced by adopting an e-business approach. These are:

•  Production processes – including procurement, ordering stock, payment processing, links with suppliers and production control.
• Customer-focused processes – including marketing, selling via the Internet, customer support and processing of customer orders and payments
•  Internal management processes – including training, recruitment, internal information sharing and other employee services.

E-business is part of a broader Internet economy which encompasses all of the activities involved in using the Internet for commerce. The CREC (Center for Research and Electronic Commerce) at the University of Texas has developed a conceptual framework for how the Internet economy works (http://cism.mccombs.utexas.edu). The Internet economy is made up of four layers:

1.  Internet infrastructure. Companies that provide the hardware, software and other equipment for the Internet. Examples: ISPs, networking companies and manufacturers of PCs and servers.
2. Internet applications infrastructure. Companies that provide software facilitating Internet transactions. Also, companies that provide web development, design and consulting services. Examples: producers of web development software, web-enabled databases and search engines.
3.  Internet intermediaries. Companies that link buyers and sellers, for example by providing content or by creating marketplaces where business can be transacted. Examples: travel agents, content providers and online brokerages.
4.  Internet commerce. Companies that sell products and services to consumers or other companies. Examples: online retailers, subscription or fee-based services and manufacturers selling directly to the public.

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