THE ROLE OF INFORMATION SYSTEMS IN VARIOUS FIELDS
ARIZONA STATE UNIVERSITY
CIS 235 - INTRODUCTION TO INFORMATION SYSTEMS
WEEK 1
A. INFORMATION SYSTEM DEVELOPMENT:
The development of the current system proves that every essence of human life is
highly dependent on technology. Information is one of the goals of humans in interacting and
socializing. This is because by applying technology, work will become easier and save more
time (Efendi et al. 2023). Thus the information system becomes a combination, combination,
collection of various processes and tools that are interconnected in collecting, processing,
storing and analyzing and presenting, providing the information needed easily and quickly for
the organization (Mulyati 2017; Sudipa et al. 2023). With this information system, it can
improve the performance of an organization such as speeding up all processes and increasing
revenue. In its development, the information system has a history in its development. There
are 4 (four) eras of development starting from (Angellia et al. 2023):
1.
The Pre-Mechanical Period which uses symbols and images in the
delivery/dissemination of information.
2.
Mechanical period that uses devices for storing, processing, and recording information.
3.
The Electromechanical Period marked by the invention of the telephone and morse code
for use in communicating over long distances.
4.
The Electronic Period marked by the existence of ARPANET (Advanced Research
Project Agency Network) as a pioneer of the development of the internet world.
Information systems are built and developed because they have great goals and benefits
for organizations or companies.
B. BENEFITS OF INFORMATION SYSTEMS:
Information systems have now become the foundation and progress in the
transformation of various essentials of human life. Information systems play an important
role in information management, communication, and decision making in various
fields/sectors, ranging from business, government, education, health, and other sectors
(Jamaludin 2019; Lindawati and Salamah 2011). The use of information systems allows
organizations to optimize operational processes and provide the best service to customers and
stackholders. The benefits that can be obtained from information systems can be classified as
follows (Aswati et al. 2015):
1.
Reduce costs
2.
Reduce errors
3.
Increase activity speed
4.
Improve management planning and control
Here are some of the benefits possessed by information systems, namely (Sudipa et al. 2023):
1.
Accelerate Business Processes, information systems contribute to providing fast,
accurate information and can provide assistance in making decisions.
2.
Increase Efficiency, increase efficiency in helping optimize business processes and
reduce data redundancy.
3.
Improve Accuracy, ensuring data is up-to-date.
date and correct data.
4.
Increase the Speed of Information Reach, information that is easily accessible when
needed.
5.
Increase Effectiveness, the information available has actually been used and utilized.
6.
Improve Collaboration, making it easier to exchange information between departments
and individuals within an organization.
7.
Increase Security, ensuring that the data stored and used is secure and protected from
malicious access.
8.
Supporting Decision Making, information systems provide information with high
accuracy, up-to-date data and relevant data so that it can be used in decision making.
C. THE ROLE OF INFORMATION SYSTEMS:
In its application, information information systems have a role in various fields:
1.
Health sector
The presence and progress of information systems have brought tremendous benefits
in the health sector where information systems present and provide effective and efficient
information. Information systems in the world of health are used in improving health services
to the community / patients. Information systems are used in recording patient data, patient
medical records starting from clinical data and the results of doctor and laboratory
examinations that contain health information.
Health information is health data that has been processed or processed into a form that
contains value and meaning that is useful for increasing knowledge in supporting health
development (Adhani et al. 2022). Health Information System is an information management
that includes data, information, indicators, procedures, devices, technology, and human
resources that are interrelated and managed in an integrated manner to direct useful actions or
decisions in order to support the implementation of health development and services to the
community (Adhani et al. 2022; Pangemanan et al. 2023). Here are some examples of the
application of Information Systems in the health sector:
1)
Electronic Medical Record (EMR)
Electronic Medical Record (EMR) is an information system utilized by hospitals
which contains patient health and disease history, diagnostic test results, and other medical
data to monitor patient health progress (Astika 2020; Sudipa et al. 2023). EMR was
developed in order to make it easier for health workers to find out the patient's medical
history, monitor patient progress, and increase hospital service satisfaction to patients.
2)
Hospital Management Information System
Hospital Management Information System (SIMRS) is a system specifically designed
to meet hospital management information needs. SIMRS is a computer system used to
process and integrate the entire flow of health service business processes in the form of
networks, reporting and administrative procedures to obtain information quickly, precisely
and accurately (Gunawan 2023; Rusli 2022; Wicaksana and Rachman 2018). SIMRS
contains a number of applications that can assist hospitals in data processing, administration,
and hospital management. SIMRS has the aim to speed up, improve the effectiveness, and
efficiency of hospital management, thereby having a positive impact on patient care.
3)
Electronic Personal Health Record (E-Personal Health Record)
E-Personal Health Record is an internet-based individual health record or personal
health record, where patients' personal health information can be collected, stored, accessed
and used for various health management purposes for the rest of their lives with healthcare
providers (Kim et al. 2017; Liu, Shih, and Hayes 2011; Srimayarti, Siregar, and Rahmaniati
2019).
4)
Pharmacy Management System
Pharmacy Management System or often referred to as a drug management system is a
system used in managing drug data and ensuring that patients have received drugs according
to prescriptions (Rosyid, Marchaban, and Pudjaningsih 2021; Sudipa et al. 2023).
Information systems provide many contributions in the health sector, this can improve
hospital health services to the community.
2.
Government Field
The utilization of information systems has now been used to support government activities.
Information systems can support administrative activities related to data, so that these data
can be organized, easily accessed, and used optimally in supporting decision making. Here
are some examples of the application of information systems in the government sector:
•
E-Government
E-Government or electronic government is a form of utilization of information and
telecommunications technology to accelerate and streamline administrative processes, search,
data processing, and provide transparent services and improve the quality of service to the
community (Cahyadi 2003; Imania and Haryani 2021). The use of E-Government is used as a
tool to improve the relationship between government service performance and several parties,
namely (Mariano 2019):
a.
G2C (Government to citizen), relationship between the government and the community,
b.
G2B (Government to business), relationship between government and business,
c.
G2G (Government to Government), the relationship between government and
government.
By utilizing E-Government, the government can improve the quality of public information
services in order to realize good governance.
•
E-Filing
E-Filing or what is called Electronic filing is an application for submitting SPT
(Notification Letter) electronically which is online and real time used in order to make it
easier for taxpayers to report SPT (Idly 2019). E-filing is one part of E-Government designed
by the Ministry of Finance to make it easier for taxpayers to report SPT without having to go
to the tax office so that it is faster and saves energy. As we know that taxes are the main
source of state revenue in National Development as sustainable and sustainable activities,
with the aim of improving people's welfare (Purwono et al. 2021).
The application of information systems in the field of government contributes to
improving public services, improving performance, and government accountability in
supporting the achievement of national programs and development.
3.
Education Field:
The Education Information System is a combination of human resources and
information technology applications that is used to select, store, process, and retrieve data in
order to support better decision-making processes in the field of education (Emani et al.
2022; RIFAD 2022).
Some technologies that can be utilized in increasing students' learning motivation
such as the application of augmented reality (Arifah Fitriyah et al. 2023; Setiawan et al.
2023), Bing Chat (Pustikayasa, Purnawati, and Arsana 2023), Gamification (Eka Merliana et
al. 2023).
Here are some applications of Information Systems in education:
•
E-Learning:
E-Learning is a digital-based learning process that is conducted online without having
to meet face-to-face between teachers and learners (Ucu, Paturusi, and Sompie 2018). In
addition, E-Learning can be defined as asynchronous learning activities through an electronic
device and utilizing internet technology, to deliver a series of solutions and obtain learning
materials as needed which are used to improve knowledge and skills (Kamarga 2002;
Sanderson and Rosenberg 2002).
•
E-Library:
E-Library can be referred to as a digital library or an electronic version of a library. E-
library is a library that is used for Data storage in the form of books (writing), images, sounds
in the form of electronic files and distribute them using electronic protocols through
computer networks (Ghobadi Gan 2014). E-Library aims for users to access scientific
information in digital form without being hindered by distance and time (Ghobadi Gan 2014;
Purwadi 2018). Senayan Library Management Systems (SLiMS) is one example of digital
library management software that has now been widely used in educational institutions.
•
Bibliotech Information System:
This information system is a system used by users in terms of managing data and
information about bibliotech which includes book collections, loans, returns and others
(Sudipa et al. 2023). Bibliotek is part of the E-Library because the E-Library provides book
collection search features and collection borrowing and lending facilities.
•
Academic Information System:
Currently, the Academic Information System is a necessity in the field of education
because it facilitates student data management, learning implementation, and academic
information systems provide data storage security. Academic information system is a system
designed and built to provide information services in the form of student data, classes,
teachers, student schedules in learning, teaching schedule, and student grades with the aim
that academic data is better managed (Indriyani Editor, Pandansari, and Anggraeni 2022;
Nuraeni et al. 2022; Solahudin 2021). Information systems in the field of education play an
important role in its application. Information systems provide many benefits in data
management and provide data security.
4.
Agriculture:
Indonesia is one of the developing agricultural countries and one of the sectors that
makes a major contribution to development is the agricultural sector (Tandirerung, Syahrul,
and Padil 2021). The agricultural sector is expected to meet the food needs of the Indonesian
population. This sector is the field of work with the largest distribution of labor at 29.76%
(Badan Pusat Statistik 2021). One example of the application of information systems in
agriculture is the Agricultural Management Information System. Agricultural Management
Information System is a system used to process business process data in agriculture with the
aim of optimization in processing all agricultural business processes (Nugraha and Hasugian
2018; Setiawan et al. 2022).
The Information System can also be utilized to manage the distribution of agricultural
products, as well as display information on market results and place orders for agricultural
products to be sold meet the basic needs of the community (Tandirerung et al. 2021). In
addition, the use of marketing information systems can bridge transactions between farmers
and buyers in marketing agricultural products. Information systems can be an alternative to
be able to help agricultural management get better.
5.
Transportation Field:
The application of Information Systems in the field of transportation has a positive
impact, namely making it easier and faster for someone to travel, absorbing labor so as to
reduce unemployment, connecting cities globally via the internet, and helping the state to
establish foreign cooperation in the field of export and import. Information systems in the
field of transportation make extensive use of information technology, such as the use of GIS
(Geographic Information System) which will be called GIS (Geographic Information
System), GPS (Global Positioning System), algorithms in determining the shortest route,
scheduling, or others.
The application of information systems in the field of transportation contributes to
solving traffic transportation problems and is able to realize integrated public transportation.
MANAGEMENT INFORMATION SYSTEM:
A. DEFINITION OF MANAGEMENT INFORMATION SYSTEM:
Management Information Systems (MIS) are very familiar to those involved in
managing a company and the business world. The development of SIM has led to changes in
the pattern of decision-making by managers, who are required to always be able to obtain the
most accurate and up-to-date information that they can use in the decision-making process.
Along with the development of information technology, especially the internet, managers are
expected to be able to more easily analyze their performance with the use of available
information technology.
The definition of Management Information System (SIM) is actually diverse and
many experts have explained it. However, a concise definition of SIM is a system that can
provide information. If elaborated, SIM is a system that provides information needed for
managers to make effective decisions, both routine and strategic decisions in order to achieve
organizational goals. It collects data from various sources by utilizing people, technology,
and procedures, and then processes it for provide accurate and timely information, tailored to
the needs of managers to achieve success.
B. MANAGEMENT INFORMATION SYSTEM COMPONENTS:
The components of a Management Information System (MIS) are divided into two,
namely functionally and physically.
1.
Functional SIM Components:
This component deals with data collection techniques, processing, transmission, storage and
presentation of information needed by management, including:
a.
Administrative and Operational Systems
This system carries out routine activities such as the personnel section, the administration
section which has determined procedures.
b.
Management Reporting System
This system serves to create and submit periodic reports to decision makers, so that
decision makers have the information needed to make decisions correctly.
c.
Database System
A database is the organization of a set of interrelated data that makes it easier to obtain
information. The database system serves as a storage place for data and information by
several units organization. Databases tend to grow, in line with the development of the
organization. To manage databases, software called Data Base Management System
(DBMS) is required. DBMS allows users to create, maintain, control and access
databases practically and efficiently.
d.
Search System
This system provides data or information needed in decision-making according to the
request.
e.
Data Management
Ensure that data is accurate, up to date, secure and available to users.
2.
Physical SIM Components:
This component relates to the equipment, software, brainware and procedures used to run the
management information system. These components include:
a.
Hardware
Is one of the components of a computer that can be seen and touched by humans directly,
which functions to support the computerization process. Examples: computers, hard
drives, servers, networks, and others.
b.
Software
Is a component that cannot be physically seen and touched. Software is a set of electronic
data that stored and organized by the computer. Electronic data can be in the form of
programs or instructions that will execute a command. It is through this software that the
computer can execute a command.
c.
Operating Procedure
Procedures are components that are provided in physical form, such as manuals.
d.
Brainware / Human Resources
It is the human element that runs the SIM, namely: Operator, Programmer, System
Analyst, Database Administrator, and others.
C. MANAGEMENT INFORMATION SYSTEM OBJECTIVES:
Some of the objectives of Management Information Systems, namely:
1.
Helping leaders in an organization or company make decisions.
2.
Provide information used in planning, controlling, evaluating, and continuous
improvement.
3.
Improve the quality and accuracy of information.
4.
Control management functions to provide information quickly, easily and on time.
5.
Control the company to be better and maximize the potential of existing information
systems.
D. PROCESSES IN MANAGEMENT INFORMATION SYSTEMS:
1.
Input
Data collection from various sources. Data can come from outside the organization or from
within the organization. Data is recorded in basic documents. The next process is to enter the
data into the information system.
2.
Process
Processing data to produce useful information.
3.
Output
Presenting quality and useful information to end users in a form that is easy to understand.
4.
Feedback
System performance evaluation and continuous improvement.
E. MANAGERIAL DECISION MODEL:
1.
Programmatic / Structured Decision
These are decisions that are repetitive and routine, so they can be programmed/automated.
Decisions are made using clear rules and procedures. Structured decisions occur and are
carried out mainly at the lower levels of management.
2.
Semi-programmed / Semi-structured Decision
These are decisions that are partially programmable / cannot be fully automated. Semi-
structured decisions are characterized by incomplete rules for making decisions, and require
human judgment and consideration subjective as a complement to formal data analysis.
However, these decisions are often supported by the assistance of computer-based decisions.
3.
Unprogrammed/Unstructured Decision
These are decisions that are related to new problems (they do not occur repeatedly and do not
always occur). Unstructured decisions are usually also related to problems that are quite
complicated, because many parameters are unknown or not yet known. To make this
decision, usually the intuition and experience of an organizational actor will be very helpful.
Unstructured decisions can be supported by the help of computer-generated decisions.
F. DEVELOPMENT AND IMPLEMENTATION OF MANAGEMENT INFORMATION
SYSTEMS:
In developing a management information system, of course, a method is needed to form a
framework so that the information system can run as desired and ensure the successful
implementation of a system that meets organizational goals and maximizes productivity. The
method is the System Development Life Cycle (SDLC). The SDLC outlines several
tasks/stages of work required for the development of information systems Phases in the
SDLC:
1.
Planning
In this phase the system development team collects data from several stakeholders such as
customers, internal and external experts, and managers to create a software requirements
specification document. The team estimates costs, creates a schedule, and has a detailed plan
as expected by users. Data collection can be obtained through interviews, discussions or
direct surveys.
2.
Design
In this phase the system development team uses the information that has been collected
previously to create a system design that can help determine the hardware, software and
define the overall system architecture.
3.
Development
In this phase the system development team works with programmers to develop the required
software. And also work with system users to develop effective software.
4.
Testing
Before an information system can be launched, the company must first conduct testing.
Testing is needed to test the feasibility of the software and ensure that the software meets the
needs of its users. Phase Testing often runs in parallel with the development phase.
5.
Implementation
This phase involves training users to handle the system. This process includes converting
files from old to new formats or building databases, installing equipment and bringing the
new system into production.
6.
Maintenance
In this phase the system development team monitors all processes that ensure the continuity,
smoothness and improvement of the system that has been operated.
G. CHALLENGES IN MANAGEMENT INFORMATION SYSTEMS:
1.
Expensive system, equipment and maintenance costs
In the management information system certainly requires a lot of costs, these costs include:
hardware costs, system implementation costs, venue costs and other environmental factors,
operational costs.
2.
The need for HR training
In the current industrial era 5.0, there is a need for human resources who can adapt to
technological advances. Companies need to conduct HR training to be able to compete. And
it is certain that to conduct training, there needs to be a careful cost budgeting so that it is
effective and does not waste unnecessary costs.
3.
Change management
Changes in management information systems, due to changes in business needs and
technology, require costs in procuring equipment and other things.
4.
Database and information security
Each management information system certainly has its own weaknesses. Therefore,
companies need to choose the right system with strong security, so that data / information is
safe from leakage.
H. EXAMPLE OF MANAGEMENT INFORMATION SYSTEM APPLICATION:
In practice, Management Information Systems (MIS) are applied in various fields, such as
accounting, academics, marketing, personnel and so on. Here is an example of the application
of SIM:
1.
Enterprise Resource Planning (ERP)
ERP is a business management application that facilitates integrated business
management. ERP is usually used by companies in managing management and conducting
integrated supervision of work units within the company, such as accounting, finance,
marketing, human resources, inventory management and operations. Examples of ERP
implementation: inventory management, E-Procurement.
2.
Decision Support System (DSS)
DSS is a computer-based information system that uses decision models and specialized
databases to assist the decision-making process for managers. Example: an application to
determine the feasibility of a credit proposal at a bank.
3.
Transaction Processing System (TPS)
Every company has various activities that involve transactions. This is certainly very
important because it is directly related to the company's financial condition. Mistakes
when calculating or conducting transactions can cause huge losses to the company.
Therefore, companies should implement a technology called TPS that functions to
effectively and efficiently manage daily routine transactions generated in a large number
of business activities, such as payroll, sales, purchases and inventory changes.
4.
Information Reporting System (IRS)
IRS provides product information to managers to support them in making daily decisions.
Information from IRS can be in the form of customized reports on request, or periodically.
For example: sales managers receive sales analysis reports every month to evaluate
product sales results.
5.
Supply Chain Management (SCM)
SCM is very useful for management to manage the supply chain or series of activities
related to producing and distributing products or services to customers. The data presented
is integrated from planning, raw material supply, production, distribution, retailers to end
consumers.
6.
Office Automation System (OAS)
This system is useful for processing, storing data and sending data and information in the
form of electronic office communication. No more piles of documents that need to be
checked one by one, because everything can be accessed faster digitally. Example:
managing employee attendance related to employee payroll, communication between
departments in a company by integrating computer servers for each user in the company.
7.
Expert System (ES) and Artificial Intelligence (AI)
This system basically utilizes artificial intelligence to study problem solving by using
expert knowledge that has been incorporated into it. Example: scheduling system.
8.
Accounting Information System
Are records and reports that are coordinated in such a way that is supported by information
technology to provide the financial information needed to facilitate company management.
E-COMMERCE AND ELECTRONIC COMMERCE INFORMATION SYSTEMS:
A. BASIC CONCEPTS OF E-COMMERCE:
E-commerce, or electronic commerce, is the process of buying, selling, exchanging,
or distributing goods, services, and information over the internet and other computer
networks. Basically, e- commerce involves electronic transactions where payment and
delivery of goods or services are done online. It could involve direct purchases from an
online store website, online auctions, or transactions through digital payment platforms.
There are several business models underlying e-commerce, including Business-to-Consumer
(B2C), Business-to-Business (B2B), Consumer- to-Consumer (C2C), and Consumer-to-
Business (C2B). Each model has different transaction dynamics depending on the
relationship between the parties involved in the trade. E-commerce requires the right platform
and infrastructure to support its operations, including e-commerce websites, inventory
management systems, online payment systems, and goods delivery systems.
History of E-Commerce Development:
The development of e-commerce has gone through various stages and has an important
historical value since the beginning of the concept to become a rapidly growing global
industry today.
1970s - 1980s: Initially, the concept of electronic commerce began with the development of
electronic funds transfer systems such as Electronic Data Interchange (EDI) used by
companies for electronic exchange of business documents.
1990s: The World Wide Web era began, and the internet became more accessible to the
general public. This opened the door for the development of e-commerce. One of the
early milestones was the launch of the first e-commerce platforms, such as Amazon
(1994) and eBay (1995).
Early 2000s: E-commerce began to grow rapidly around the world, especially with consumers'
increasing confidence in online purchases. Major companies such as Alibaba (1999) and
PayPal (2000) began to play an important role in the industry.
2000s - 2010s: Technological developments such as increased internet speeds, more
sophisticated mobile devices, and more advanced e-commerce platforms changed the e-
commerce landscape. The emergence of concepts such as Mobile Commerce (M-
Commerce) also became a significant trend.
2010s - Now: E-commerce becomes one of the biggest industries
in the world, with continued growth. Innovations such as big data, artificial intelligence, and
personalized shopping experience customized is dominating more and more. Big
companies like Amazon continue to lead in this industry while new startups emerge with
innovative ideas.
2020s and Beyond: The COVID-19 pandemic significantly accelerated the growth of e-
commerce with social restrictions and physical store closures, forcing more businesses
and consumers to turn to online shopping. Developments such as digital payments, drone
delivery, and the use of artificial intelligence are expected to continue shaping the future
of e- commerce.
Advantages and Challenges of E-Commerce:
Advantages Global Access
Global Access: E-commerce allows companies to reach out to the global market without
having to have physical stores in every location. It enables business expansion without
geographical restrictions.
Low Operating Costs
E-commerce businesses often have lower operating costs compared to conventional
businesses due to reduced rent, stock, and other overheads.
Shopping Convenience
Consumers can shop anytime and anywhere without having to leave home. This provides
great convenience and increases product accessibility.
Effective Marketing
E-commerce allows companies to use effective digital marketing strategies such as SEO,
online advertising, and marketing through social media to reach consumers at a lower cost.
Customer Data Analysis
Companies can track customer behavior in detail and use this data to improve customer
experience, customize product offerings, and increase customer retention.
Challenges Security and Privacy
Transaction security and customer data protection are major challenges. Threats such as
identity theft and system hacking can damage a company's reputation and reduce consumer
confidence.
Fierce Competition
The e-commerce market is often highly competitive with many competitors offering similar
products. Companies need to have a strong strategy to differentiate themselves from
competitors and attract customers.
Adequate technology infrastructure
Having a reliable technology infrastructure that can handle a large number of transactions is
key to e-commerce success. Companies need to invest in the right technology
Shipping and Logistics
Managing shipping and logistics is a big challenge in e- commerce, especially when facing
international shipping requirements or when goods require special conditions.
Customer Service
Providing good customer service in an online environment can be challenging, especially
since consumers often expect quick responses and instant solutions to their problems.
B. E-COMMERCE INFRASTRUCTURE:
E-commerce infrastructure refers to the set of technologies, hardware, software, networks and
procedures that support online business operations.
Hardware:
•
Server: Serves as the data center where the e- commerce website is hosted and customer
information is stored.
•
Client Computer: A device such as a desktop computer, laptop, or mobile device used by
consumers to access e-commerce websites.
•
Storage Devices: Data storage required to store product information, customer transactions,
and other business data.
Software:
•
E-Commerce Platform: Software that enables the management of e-commerce websites,
including inventory management, payment processing, and customer management.
•
Content Management System (CMS): Used to create, edit, and manage the content of e-
commerce websites.
•
Database Management System (DBMS): Used to store and manage customer, product, and
transaction data.
•
Security System: Software to secure e- commerce websites from threats such as cyber attacks
and data theft.
Network:
•
Internet: A global communications infrastructure that enables interaction between e-
commerce servers and end users.
•
Internal: A local network that connects all devices and systems within an e-commerce
organization.
Security:
•
Certificate SSL (Secure Sockets Layer): Used used to encrypt data sent between e-commerce
servers and client devices, ensuring the security of customers' personal information.
•
Firewall: Prevents unauthorized access to e-commerce servers and protects data from hacker
attacks.
•
Intrusion Detection System (IDS) and Intrusion Prevention System (IPS): Monitors and
protects e-commerce infrastructure from cyber attacks.
C. E-COMMERCE MODEL:
E-Commerce models refer to the various ways in which businesses and consumers
interact and conduct transactions in an online environment. Here is a brief explanation of
some common e- commerce models:
Business-to-Consumer (B2C):
This model involves transactions between companies and individual consumers.
Example: Online purchase of products from retail websites such as Amazon, eBay, or a
particular brand's official online store.
Business-to-Business (B2B):
Transactions occur between two or more companies. They usually involve bulk
purchases, wholesale sales, or the exchange of goods and services between businesses.
Example: Purchase of raw materials from suppliers, consulting services between companies.
Consumer-to-Consumer (C2C)”
This model allows consumers to interact and conduct transactions directly with each
other. Typically these platforms facilitate transactions between consumers without the
involvement of a business. Example: Sale of used goods or other personal items on platforms
such as eBay, Craigslist.
Consumer-to-Business (C2B):
In this model, consumers offer their products or services to companies.Usually
involves content creation, design services, or specific projects provided by individuals to
companies.Example: A freelancer offers graphic design services to companies in need.
Mobile Commerce (M-Commerce):
This model involves transactions made through mobile devices such as smartphones
or tablets.This includes purchasing products, paying bills, or even using banking applications
through mobile devices.Example: Online shopping apps like Amazon or digital payment
platforms like PayPal.Each e-commerce model has different characteristics and strategies,
and businesses usually choose the model that best suits the products or services they offer as
well as their customers' preferences.
D. CONCEPT OF ELECTRONIC COMMERCE INFORMATION SYSTEM:
The concept of E-Commerce Information Systems refers to the information
technology infrastructure that supports business operations in an electronic commerce
environment. It includes various technologies, software, procedures, and resources used to
manage online business processes.
1.
E-Commerce Platform: An electronic commerce information system often consists of an
e-commerce platform, which is the basic infrastructure for running an online business. It
includes an e-commerce website, product database, payment system, and other
functionalities that enable online transactions.
2.
Content Management: E-commerce information systems enable efficient content
management for e-commerce websites, including product descriptions, images, prices,
and other important information. This allows companies to update and manage product
information easily.
3.
Inventory Management: The information system also includes an inventory management
system to track product stock, manage orders, and ensure proper availability of goods for
customers. This helps companies to optimize their inventory and prevent shortages or
overstocks.
4.
Customer Management: E-commerce information systems also include customer
management systems that allow companies to track customer data, purchase history,
preferences, and other information. This helps in understanding and targeting customers
more effectively.
5.
Security and Data Protection: Information security and data protection are integral parts
of an electronic commerce information system. This involves the use of security
technologies such as SSL for data encryption, firewalls to protect against cyber attacks,
and strict security policies to protect sensitive customer information.
6.
Data Analysis: E-commerce information systems enable in-depth data analysis on
customer behavior, sales trends, and overall business performance.
It helps companies to make better decisions, identify opportunities, and improve
operational efficiency.
7.
Integration with Enterprise Systems: E-commerce information systems also need to be
integrated with other enterprise systems such as inventory management, accounting, and
logistics to ensure a smooth and coordinated flow of work across the organization.
By understanding this concept of e-commerce information systems, companies can
design and implement the necessary technology infrastructure to support their online business
operations effectively and efficiently.
E. ELECTRONIC COMMERCE INFORMATION SYSTEM STRATEGY:
E-Commerce Information Systems Strategy refers to the plans and approaches used
by companies to manage and optimize the information systems that support their e-
commerce operations.
By implementing the right e-commerce information system strategy, companies can
improve operational efficiency, enhance customer experience, and achieve success in an
increasingly competitive e-commerce environment.
F. SECURITY IN ELECTRONIC COMMERCE INFORMATION SYSTEMS
Security in E-commerce Information Systems Security is critical as it involves the
transfer of sensitive information such as payment data, customer personal information, and
transaction details online. Here are some of the security aspects that are important in the
context of e-commerce information systems:
1.
Data Encryption: Data encryption is the process of converting data into a form that is not
directly understandable except by recipients who possess the appropriate encryption key.
This ensures that the data transmitted between the e- commerce server and the client
device is protected from unauthorized snoopers.
2.
SSL (Secure Sockets Layer) Certificate: SSL is a security protocol used to secure the
connection between a web server and a browser. E-commerce websites that use SSL will
display an SSL certificate, which indicates that the information transmitted is encrypted
and secure.
3.
Firewall: A firewall is a security system used to protect e-commerce servers from
unauthorized access or cyber attacks. It monitors incoming and outgoing network traffic
and blocks or filters suspicious traffic.
4.
Protection from Hacking Attacks: Protection from hacking attacks such as DDoS
(Distributed Denial of Service) attacks and SQL injection attacks is essential in
electronic commerce information systems. This involves the use of sophisticated security
software and active monitoring to detect and prevent suspicious attacks.
5.
Identity and Access Management: Electronic commerce information systems should be
equipped with robust identity and access management to ensure that only authorized
users can access the information authorized who have access to sensitive data and critical
functions in the system.
6.
Security Policy: Strict and properly implemented security policies are key to maintaining
security in electronic commerce information systems. This includes policies on strong
passwords, limited user access, and the use of up-to-date security software.
7.
Security Monitoring and Recovery: Active monitoring of the system and quick response
to security threats are important steps in maintaining security in electronic commerce
information systems. This includes data recovery from backups in the event of a security
breach or data loss.
By implementing proper security measures, companies can protect sensitive customer data,
prevent cyber-attacks, and build customer trust in an electronic commerce environment.
DECISION SUPPORT SYSTEM
A. INTRODUCTION:
In this era of globalization, business development is strongly influenced by
technological developments. With the tight business competition, the conventional way of
producing goods and then distributing them to be sold is not enough to develop a business.
New strategies and technology development are needed to support the business being run in
order to compete with other similar businesses. The role of technological development in the
business world can be seen in the case of Nokia, a world-famous cellphone brand. Nokia used
to be a leading company in the cellular phone industry, which always presents its latest
innovations. So that its products are always favored by consumers almost all over the world.
But finally Nokia had to be blown away from the world of the cellular phone industry, this
happened because the management was wrong in making decisions. They are too confident in
what has been achieved and do not innovate the development of cellular phone technology.
So that Nokia lost competition with other cellphone brands and eventually went bankrupt.
From this Nokia case, we can see the importance of making the right decision for a company
or organization. So that there is a need for a Decision Support System (SPK).
Why is this SPK necessary? Because SPK is a system that can provide the best
solution for decision making, by analyzing existing ad hoc data and seeing the current
business situation. So that business people will be able to make better and higher quality
decisions.
B. DECISION MAKING:
Decisions are the most important key in a planning activity. Because in the planning
process, decision makers (managers) must decide important matters related to company
managerial matters, decisions are the result of a process of selecting the best alternative
among several existing alternatives. So that the decision must have good quality, because this
decision will later determine the effectiveness of the plan that has been prepared.
Decision making is a series of actions that must be passed to choose the best
alternative among several alternatives systematically as a way of solving problems to avoid
or reduce negative impacts. The activities required in this decision-making process are the
collection of data/information needed and determining the decision-making method that will
be the basis for making decisions. The completeness of data and information about the
alternatives to be selected greatly influences the decision-making process. If the data and
alternative information are complete enough, then the decision-making process will be easier
decision-making can be done with relative ease, and vice versa. This will not be easy if the
available resources are limited, especially if the information needed does not come directly
from the source. Therefore, to improve the quality of decision-making, management as
information users need a support system, especially for solving unstructured conditions. The
need for a support system capable of improving decision-making is based on the following
reasons:
1.
Meet the needs of upper management.
Top-level management is required to be able to make strategic decisions. If you only rely on
management information systems without the help of supporting systems, it will be difficult
to achieve. This is because generally strategic decision making is more policy in nature with
broad impacts, or in unstructured situations.
2.
The need to produce good reporting and meaningful decision-making processes (quality
and competitiveness).
Management must have the ability to develop better reporting to measure the performance of
the activities carried out. With the help of support systems, it will be able to improve the
ability to process and store data and information, reduce costs, support the management's
ability to manage the data and information technical aspects in decision making. This allows
management to get better reporting and decision-making processes.
The decision-making process can be seen as a system, which consists of the following
components (Diana, 2018):
1.
Input
The inputs in the decision-making process are data and information. Data can be
numbers, letters, sounds, pictures, conditions, objects, concepts, or events. These data
are then processed into information. The more complete the data and information
obtained, the decision-making process can be carried out quickly and with good quality.
2.
Process
It is the steps taken to obtain the best decision, which is done by the decision maker. In
order for the resulting decision to be correct and objective, what needs to be avoided is
subjective thinking. This is often an obstacle in the decision-making process, so it is
necessary to have system support, namely a decision support system (SPK). But what is
important here, decision support systems only function to provide support for decision
makers, not replace the role of decision makers.
3. Output
As the output of the decision-making process is the best decision determined/chosen by
the decision maker. The decision is in the form of the best alternatives from several
alternatives offered.
C. DECISION-MAKING STAGES:
According to Simon, there are several main stages in the decision making process, namely
(Turban, et al., 2007):
1.
Intelligence
This stage begins with identifying the goals and objectives of the organization, and
determining whether these goals have been met. By monitoring and analyzing
productivity levels, the existence of problems can be determined. Tracing and detecting
the problem is done to determine whether the problem really exists, whether and how the
symptoms of the problem, where the problem is located, and how significant the problem
is. Only then can the problem be classified and identified. An important process at this
stage is determining the ownership of the problem. This is so that someone or some
group is responsible for addressing the problem and has the ability to solve it. The
intelligence stage ends with a formal problem statement.
2.
Design
This stage is the process of building decision-making goals that are developed in a
model. Modeling includes conceptualizing the problem and abstracting the problem into
quantitative and qualitative forms. Furthermore, determining criteria for evaluating
alternative actions that might be carried out. The alternative action is a simplified form or
representation of real events, therefore it is necessary to have a validation and
verification process to determine the accuracy of the existing problem model.
3.
Choice
At this stage, the process of selecting among various alternative courses of action is
carried out. This stage includes finding, evaluating, and recommending suitable solutions
for the model that has been created. The solution of the model is a specific value for the
outcome/decision variable for a selected alternative. This solution needs to be tested to
determine its viability (possibility to be selected). If the solution is selectable and
realistic, then proceed to the next stage, which is the implementation stage.
4.
Implementation
This stage is the implementation stage of the solution or decision that has been
taken/selected. There are a series of planned actions that need to be organized at this
stage, so that the results of the decision can be monitored and adjusted if improvements
are needed. Successful implementation will result in a solution the real problem.
However, if it fails, the process will return to the previous stage.
D. DECISION SUPPORT SYSTEM:
Decision Support System (DSS) is one type of information system that can be used to
assist management in the decision-making process. The main characteristic of SPK is that it
has the ability to determine the best alternative decision from a number of alternatives by
applying certain criteria. The decisions obtained from SPK can be in the form of rankings or
optimal values.
Some experts define Decision Support Systems (DSS) as follows:
1.
Moore, et al, define a decision support system as a system that can be developed to
support the process of data analysis and decision modeling to deal with semi-structured
and unstructured problems, which are oriented towards future planning, and are used in
an unplanned range (Turban, et al., 2007).
2.
According to Little, a decision support system is a computer-based information system
that is used to help management deal with structured and unstructured problems using
data and models. The system can provide various alternative decisions. (Turban, et al.,
2007).
3.
According to O'Brien, a decision support system is a system used to make certain
decisions by using decision-making models. The decision support system is used to
solve unstructured problems (O'Brien, et al., 2007).
SPK is a computer-based system that has the ability to provide solutions or solutions to
unstructured problems.
E. CHARACTERISTICS, CAPABILITIES, AND LIMITATIONS OF SPK
There are several characteristics of SPK, namely (Turban, et al., 2007):
1.
Using some quantitative models.
2.
Using both internal and external data.
3.
Possess what-if analysis and goal seeking analysis skills.
4.
Supports multiple decisions that interact with each other.
5.
It can be used repeatedly and is constant.
6.
There are two main components, namely data and model.
7.
Support all activities of the organization.
While the capabilities that must be possessed by SPK include (Turban, et al., 2007):
1.
Able to support solution determination or management decision making on unstructured
and semi-structured problems.
2.
Able to assist management, from lower management to upper management.
3.
Able to support making decisions both in groups and individuals.
4.
Capable of supporting sequential and interdependent decision-making processes.
5.
Able to support decision-making stages.
6.
Able to support various types/forms of decision-making processes and types of decisions.
7.
Able to adapt at any time and be flexible.
8.
It is easy to interact with the system.
9.
Increase effectiveness in decision-making or decision-making over efficiency.
10.
It is not difficult to be developed by end users.
11.
Ability to model and analyze in decision making.
12.
Easy access to various data sources and formats.
However, SPK also has limitations, among others:
1.
The model contained in the system does not entirely reflect the actual problem, as there
are not all management capabilities and human talents that can be modeled.
2.
The capabilities of SPK are limited to its knowledge base and model base.
3.
The processes performed by the SPK usually also depend on the capabilities of the
software it uses.
4.
Since a SPK is just a collection of software, hardware, and an operating system (without
the ability to think), it does not have the intuition that humans have. It only relies on the
capabilities of a computer-based system and can serve problem solving.
F. DECISION SUPPORT SYSTEM COMPONENTS:
The components contained in SPK include (Turban, et al., 2007)
1.
Data Management
This component includes a database that contains relevant data and will be managed by
a Database Management System (DBMS), data directories, and query facilities.
2.
Model Management
This component is a software package that provides the right (required) analytics and
software management capabilities.
3.
Dialog Management (Communication)
This component provides an interface that allows communication between the user and
the system, the user can give commands to the SPK through this component.
4.
Knowledge Management
This component is optional, capable of supporting other components or acting as an
independent component.
G. DECISION SUPPORT SYSTEM ELEMENTS:
There are three elements associated with SPK, namely problems, solutions, and results (Latif,
et al., 2018).
1)
Problem
There are several types of problems in SPK, namely:
a.
Structured Problem:
The characteristics of structured problems are: they occur frequently, the problem is known in
advance, and the solution is already established (there is an SOP).
Examples of structured problems include:
1.
Can't login to internet banking because I forgot my password. Then the problem-solving flow
is:
•
Click forgot password
•
Open email/sms
•
Enter OTP
•
Create a new password
•
Login
2.
Lost your ATM card:
Then the flow of solving the problem is :
•
Take care of the loss to the local police station / the place where the ATM was lost
•
Bring it to the bank along with your passbook and ID card
•
Go to customer service and request a new ATM card
•
Activation of new ATM card at ATM machine
b.
Semi-structured Problem:
The characteristics of semi-structured problems are: they occur occasionally, the problem is
half known, and often the solution does not yet have an SOP.
Examples of semi-structured problems include:
1.
Opening a new account during the pandemic and lockdown.
Then the flow of solving the problem is :
•
The requirements remain the same (show ID card, take a photo and fill out a form).
•
Data validation method changed (online validation).
•
ATM card activation remains at the ATM machine.
2.
Applying for Hajj leave for employees in multinational companies and not in Muslim-
majority countries. Then the flow of problem solving is :
•
There was a process of applying for leave, but no suitable category was found.
•
The requirements for pubic documents are different from maternity leave, traveling or
others.
c.
Unstructured Problem:
The characteristics of unstructured problems are: they rarely occur and even if they do, the
solution will be unique for each problem, the dependent variables are quite numerous and
sometimes intangible.
Example of an unstructured problem:
1)
Determining college majors after graduating from high school. The flow of problem solving
is to pay attention or consider the following variables:
•
PT entrance test score
•
Interests and talents
•
IQ test scores
•
Family background
2)
Determine the location of the store branch opening. The flow of problem solving is to pay
attention or consider the following variables:
•
Building rental price
•
Distance from major roads
•
Potential buyers
•
Local customs and culture
2)
Solution:
There are two types of problem solving solutions or decision-making methods in SPK,
namely (Latif, et al., 2018):
a.
Multi Criteria Decission Making (MCDM)
It is a method used to find the optimal alternative from a number of alternatives with certain
criteria (Kusrini, 2007).
Example:
•
Selection of exemplary students, which is based on criteria: report card scores, achievements,
attendance scores, etc.
•
Determination of the location of housing development, which is based on criteria: land price,
type of land certificate, land location, etc.
MCDM methods include: Weight Product (WP) method, Simple Additive Weighting (SAW)
method, Technique for Order of Preference by Similarity to Ideal Solution (TOPSIS) method,
Analytical Hierarchy Process (AHP) method, Elimination and Choice Translating Reality
(ELECTRE) method, Competency Gap method, etc.
b.
Multi Objective Decission Making (MODM):
It is a method used to solve problems in continuous space.
MODM methods include: Weighting Method, Goal Programming (GP), Efficient Solution via
Global Programming (ESGP), Interactive Multiple Objective Linear Program (IMOLP), and
STEP method (Lu, et al., 2007).
3)
Results:
The output or result of SPK is a decision that becomes a policy benchmark for a problem
(Latif, et al., 2018). A decision is a choice of one alternative among several problem-solving
alternatives to solve the problem (Rahmansyah, et al., 2021). of The purpose of the decision
is to achieve certain targets or actions that must be taken (Kusrini, 2007).
