![\"IT](\"https:\/\/pressbooks.ulib.csuohio.edu\/business-essentials-for-future-professionals\/wp-content\/uploads\/sites\/209\/2026\/02\/Gemini_Generated_Image_kou0nbkou0nbkou0-300x164.png\")
\r\n\r\nYou checked your phone this morning. Your bank already knew you woke up. Netflix already knew what you'd watch tonight. Amazon already has a box ready to ship before you even know you want it. That's not magic. That's information systems.\r\nThe jobs you will have in five or ten years will rely even more on data, technology, and systems than they do today. Understanding information systems now is not about becoming a tech expert. It is about being ready for the future of business.<\/p>\r\n
Information systems turn data into decisions.<\/p>\r\n
And in business, better decisions win.<\/p>\r\n\r\n\r\n
11.1: What Is an Information System?<\/strong><\/p>\r\n 11.2: Types of Information Systems<\/strong><\/p>\r\n 11.3: Data vs. Information vs. Knowledge<\/strong><\/p>\r\n 11.4: Hardware and Software Basics<\/strong><\/p>\r\n 11.5: Networks\u00a0<\/strong><\/p>\r\n 11.6: Databases<\/strong><\/p>\r\n 11.7: Cybersecurity and Privacy<\/strong><\/p>\r\n 11.8: Ethical and Social Issues in IS<\/strong><\/p>\r\n 11.9: IS in the Real World<\/strong><\/p>\r\n\r\n<\/div>\r\n\r\n In July 2012, Knight was preparing for a new program at the New York Stock Exchange.<\/span>\u00a0<\/span>They updated their software on\u00a0<\/span><\/span>7 out of their 8 servers<\/span>.\u00a0<\/span><\/span>A technician forgot to update the\u00a0<\/span><\/span>8th server<\/span>.<\/span>\u00a0<\/span>That server still had a piece of \u201cdead code\u201d from 2003 \u2013 a test program called \u201cPower Peg\u201d that had been dormant for nine years.<\/span><\/p>\r\n When the market opened at 9:30 AM on August 1st, the system sent orders to that 8th server.<\/span>\u00a0<\/span>The \u201czombie code\u201d woke up and began buying stocks high and selling them low, thousands of times per second.<\/span><\/p>\r\n It executed 40 trades per second across 154 different stocks.<\/span><\/p>\r\n <\/span>When engineers realized something was wrong, they tried to \u201croll back\u201d the software to the old version.<\/span>\u00a0<\/span>This actually made it worse because it reactivated the zombie code on\u00a0<\/span><\/span>all<\/span><\/i>\u00a0<\/span>the servers.<\/span><\/p>\r\n By the time they physically shut the system down 45 minutes later, they had lost\u00a0<\/span><\/span>$440 million (<\/span>nearly $10 million per minute!<\/em>) It wiped out the company\u2019s equity in under an hour.<\/span><\/p>\r\nThey went bankrupt shortly after.\r\n\r\n More and more companies are moving to cloud computing, and it is easy to see why. It saves money on physical servers, lets teams work from anywhere, and scales up or down based on what a business needs. But like any tool, it comes with real risks if it is not managed carefully.<\/p>\r\n The biggest concerns are security and data loss. When your data lives on someone else\u2019s servers, you are trusting that their security is strong enough to protect it. Sometimes it is not.<\/p>\r\n A real example: In January 2024, over 15 million Trello accounts were leaked. Trello is a project management app that tons of companies use to organize their work. Hackers found a weakness in Trello\u2019s public API and used it to pull user data including email addresses, full names, and usernames. Because so many businesses use Trello for team collaboration, that breach opened the door to phishing attacks and unauthorized access to sensitive company information. After the incident, Trello required authentication for API access to close the gap.<\/p>\r\n The takeaway is simple. Cloud tools are powerful and convenient, but businesses need to understand what they are signing up for. Storing sensitive data in the cloud without proper security practices is like leaving your front door unlocked because the neighborhood seems safe. It works until it does not.<\/p>\r\n\r\n\r\n Is Domino\u2019s a pizza company or a software company?<\/span><\/p>\r\n The Reality:<\/b>\u00a0<\/span>Domino\u2019s has a larger percentage of employees in tech\/data than in many actual \u201ctech\u201d firms. Their \u201cAnyWare\u201d system allows ordering via tweets, smartwatches, and car dashboards.<\/p>\r\n<\/li>\r\n \t The Lesson:<\/b>\u00a0<\/span>Information Systems didn\u2019t just\u00a0<\/span>help<\/i>\u00a0<\/span>Domino\u2019s; it saved them from near-bankruptcy in 2008. It\u2019s the difference between a local pizza shop and a $17 billion global leader.<\/p>\r\n<\/li>\r\n<\/ul>\r\n Information systems are the backbone of every organization running today. Understanding how data moves, gets stored, and turns into decisions gives you an edge in any career you choose. You're already living inside these systems.<\/p>\r\n Now you know how they work.<\/p>\r\n...and the individuals who understand how information flows through a business will always have an advantage over those who don\u2019t.\r\n\r\n \r\n\r\n You checked your phone this morning. Your bank already knew you woke up. Netflix already knew what you’d watch tonight. Amazon already has a box ready to ship before you even know you want it. That’s not magic. That’s information systems.<\/p>\n The jobs you will have in five or ten years will rely even more on data, technology, and systems than they do today. Understanding information systems now is not about becoming a tech expert. It is about being ready for the future of business.<\/p>\n Information systems turn data into decisions.<\/p>\n And in business, better decisions win.<\/p>\n 11.1:
\r\n\r\n \r\n\r\n11.1 What is an Information System?<\/h1>\r\n<\/header>An\u00a0<\/span>information system<\/strong>\u00a0<\/span>(IS) is a combination of hardware, software, data, people, and processes that work together to collect, store, and share information. It\u2019s not just a computer. It\u2019s the whole setup that helps people and organizations make decisions and get things done.\r\n\r\nEvery business you interact with runs on information systems. When you order from DoorDash, swipe your debit card, or register for classes at school, an information system is working behind the scenes to make that happen.\r\n
IS vs. Just \u201cComputers\u201d<\/h3>\r\nA lot of people hear \u201cinformation systems\u201d and think it just means computers. But IS is bigger than that. A computer is a piece of hardware. An information system includes the software running on it, the data being stored, the people using it, and the rules for how it all works together.\r\n
Think of it this way: your laptop is hardware. Google Docs is software. The essay you saved is data. You are the person. The process is how you write, save, and share that file. Altogether, that\u2019s a basic information system.<\/div>\r\n \r\nUnderestimating the \u201cSystem\u201d part of Information Systems<\/h2>\r\nConsider the story of Knight Capital Group.\r\n\r\nBefore 2012, Knight Capital was a titan on Wall Street.<\/span>\u00a0<\/span>They were a \u201c<\/span>Market Maker<\/span>,\u201d meaning they provided liquidity by constantly buying and selling stocks. They handled about 10% of all U.S. equity trading and were the largest trader in the U.S., moving billions of dollars every single day. They were a \u201chigh-frequency trading\u201d firm, relying on incredibly fast Information Systems to make tiny profits on millions of trades.<\/span>\r\n
![\"Knight](\"https:\/\/pressbooks.ulib.csuohio.edu\/business-essentials-for-future-professionals\/wp-content\/uploads\/sites\/209\/2026\/04\/1_Y3F7dcxb3Wqatj5NpXG9PQ-300x195.jpg\")
\r\n\r\nThe Lesson<\/strong><\/h6>\r\nAn Information System is only as good as its implementation and maintenance.\r\n\r\nIn a modern business, your Information System IS your business. If the system isn\u2019t managed with rigorous checks, balances, and \u201ckill switches,\u201d the business can be destroyed before a human manager even has time to finish their morning coffee.\r\n\r\n<\/div>\r\n \r\n\r\n*Fun Fact:<\/b>\u00a0<\/span>Because of this event, the SEC (Securities and Exchange Commission) passed the \u201cMarket Access Rule,<\/a>\u201d which basically legally requires firms to have \u201ckill switches\u201d to prevent algorithms from going rogue.<\/em>\r\n\r\n
\r\n\r\n \r\n\r\n11.2 Types of Information Systems<\/h1>\r\n<\/header>Not all information systems do the same job. Different types of IS are built for different levels of a business and different kinds of decisions.\r\n
\r\n \t
\r\n\r\nHere are some more types:<\/h3>\r\n
![\"types](\"https:\/\/pressbooks.ulib.csuohio.edu\/business-essentials-for-future-professionals\/wp-content\/uploads\/sites\/209\/2026\/04\/10-Examples-of-Information-Systems-an-infographic.png\" "\\"intellspot.com\\"")
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\r\n\r\n \r\n\r\n11.3 Data vs. Information vs. Knowledge<\/h1>\r\n<\/header>\r\n
These three words get used interchangeably all the time, but in information systems they actually mean different things.<\/h3>\r\n
\r\n\r\nData:\u00a0<\/span><\/strong>Raw, unprocessed facts. \u201c10,000\u201d or \u201cTuesday\u201d or \u201c68 degrees\u201d are data points. On their own, they mean nothing.\r\n\r\nInformation:\u00a0<\/span><\/strong>Data that has been processed and given context. \u201c10,000 people attended the concert on Tuesday when the temperature was 68 degrees\u201d is information.\r\n\r\nKnowledge:\u00a0<\/span><\/strong>What you do with information. \u201cOutdoor concerts do best on mild weekday evenings. We should schedule more of them.\u201d That\u2019s knowledge.\r\n\r\n<\/div>\r\nBusinesses collect enormous amounts of data every day. The challenge is turning that data into information, and then into knowledge that actually helps them make better decisions.\r\nIRL EXAMPLE<\/h2>\r\n<\/header>\r\n
Spotify collects data every time you skip a song, repeat a track, or let a playlist run. That data becomes information about your listening habits. That information becomes the knowledge that powers your Discover Weekly playlist.<\/div>\r\nData to information to knowledge, all happening automatically.<\/em><\/div>\r\n<\/div>\r\n\r\n
\r\n\r\n \r\n\r\n11.4 Hardware and Software Basics<\/h1>\r\n<\/header>\r\n
Every information system runs on a foundation of hardware and software. You don\u2019t need to be a tech person to understand the basics.<\/h3>\r\n
\r\nHardware<\/strong><\/h2>\r\nHardware is any physical component of a computer system. It breaks down into four functions:\r\n
\r\n \t
\r\nSoftware<\/strong><\/h2>\r\nSoftware is the set of instructions that tells hardware what to do. There are two main categories:\r\n
\r\n \t
EXAMPLE: THE CLOUD<\/h3>\r\n<\/header>\r\n
\r\n\r\nYou\u2019ve probably used the cloud without thinking about it. iCloud, Google Drive, and OneDrive are all cloud storage. Instead of saving files on your device, you\u2019re saving them on servers somewhere else that you access over the internet.\r\n\r\nFor businesses, the cloud is huge. It means they don\u2019t have to buy and maintain physical servers. They can scale up or down as needed and access their data from anywhere.\r\n\r\n<\/div>\r\n<\/div>\r\nCloud Computing: The Good and the Bad<\/strong><\/h2>\r\n
\r\n\r\n \r\n\r\n11.5 Networks<\/h1>\r\n<\/header>A network is two or more devices connected so they can share data. Networks are what make information systems actually useful at scale.\r\n
\r\n\r\nLAN (Local Area Network):\u00a0<\/span><\/strong>A network within a small area, like your school or a single office building. The Wi-Fi at your house is a LAN.\r\n\r\nWAN (Wide Area Network):\u00a0<\/span><\/strong>A network that covers a large area, like multiple office buildings across a city, or even across countries. The internet itself is the biggest WAN in the world.\r\n\r\n<\/div>\r\n \r\nWhy Networks Matter for Business<\/strong><\/h2>\r\nThink about what a store like Walmart needs to function. Every register needs to talk to inventory systems. Inventory systems need to talk to suppliers. Suppliers need to talk to logistics teams. None of that works without a network. Connectivity is not just a convenience for businesses. It is the entire infrastructure their operations run on.\r\n\r\n
\r\n\r\nWhen a network goes down, business stops. That\u2019s why network reliability and security are top priorities for IT departments.\r\n\r\n![\"\"](\"https:\/\/pressbooks.ulib.csuohio.edu\/business-essentials-for-future-professionals\/wp-content\/uploads\/sites\/209\/2026\/04\/role-of-the-IT-dept.svg\")
<\/a>\r\n\r\n
\r\n\r\n \r\n\r\n11.6 Databases<\/h1>\r\n<\/header>A\u00a0<\/span>database<\/strong>\u00a0<\/span>is an organized collection of data that can be easily accessed, managed, and updated. Almost every information system you interact with is powered by a database.\r\n\r\nWhen you log into your school\u2019s student portal, it pulls your name, ID, schedule, and grades from a database. When you search a product on Amazon, the results come from a massive product database. When Spotify loads your library, that\u2019s a database too.\r\n\r\n \r\n
Structured vs. Unstructured Data<\/strong><\/h2>\r\n
\r\n \t
\r\nWhy Databases Matter<\/strong><\/h3>\r\nBusinesses use databases to track customers, inventory, employees, transactions, and more. A well-designed database means faster searches, fewer errors, and better decisions. A poorly designed one causes slowdowns, duplicate records, and costly mistakes.\r\n\r\n<\/div>\r\n\r\n
\r\n\r\n \r\n\r\n11.7 Cybersecurity and Privacy<\/h1>\r\n<\/header>The more a business depends on information systems, the bigger a target it becomes. Cybersecurity is the practice of protecting systems, networks, and data from attacks.\r\n\r\n \r\n
Common Threats<\/strong><\/h2>\r\n
\r\n \t
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\r\n \t
<\/h2>\r\n
Why Businesses Are Targets<\/strong><\/h2>\r\nBusinesses store enormous amounts of valuable data: credit card numbers, social security numbers, health records, and login credentials. That data is worth money on the dark web. A single breach can cost a company millions of dollars in fines, lawsuits, and lost customers.\r\n\r\n
\r\n\r\n\r\nBasic Protection<\/strong><\/h6>\r\n
\r\n \t
\r\n\r\n \r\n\r\n11.8 Ethical and Social Issues in IS<\/h1>\r\n<\/header>\r\n
Technology moves fast. Laws and ethics don\u2019t always keep up. There are some serious questions about how information systems affect people and society that every business and every citizen should think about.<\/h3>\r\n\r\n
\r\n\r\nData Privacy: Who Owns Your Data?<\/strong><\/h2>\r\nEvery time you use an app, you generate data. What you click, how long you look at something, where you are. Most people agree to terms of service without reading them, which often means giving companies the right to sell that data to advertisers.\r\n\r\nThe question of who actually owns your data is still being debated. The EU passed\u00a0<\/span>the GDPR<\/a>\u00a0<\/span>(2016), one of the strongest data privacy laws in the world, requiring companies to get explicit consent before collecting data. The US has been slower to catch up.\r\n\r\nData Protection Laws in the United States\u00a0<\/a>\r\n\r\n
\r\n\r\nThe Digital Divide
![\"the](\"https:\/\/pressbooks.ulib.csuohio.edu\/business-essentials-for-future-professionals\/wp-content\/uploads\/sites\/209\/2026\/04\/Gemini_Generated_Image_oyutrnoyutrnoyut-734x1024.png\")
<\/strong><\/h2>\r\nNot everyone has equal access to technology. The digital divide refers to the gap between people who have reliable access to the internet and devices and those who don\u2019t. This gap often falls along economic and geographic lines. Rural areas, low-income households, and developing countries are disproportionately affected. In a world where more and more opportunity lives online, this is a serious equity issue.\r\n\r\nVisual Examples of the Digital Divide.<\/a>\r\n\r\n
\r\n\r\nAI and Automation<\/strong><\/h2>\r\nInformation systems increasingly include AI that can do jobs that humans used to do. Self-checkout machines, chatbots, automated scheduling, and content recommendation algorithms are already reshaping the workforce. Some jobs are disappearing. New ones are being created. The challenge is that the new jobs often require different skills than the ones being replaced, which leaves some workers behind.\r\n\r\nHow AI & Automation are Transforming IT Operations<\/a>\r\n\r\n
\r\n\r\nWorkforce Change: Remote \/ Hybrid Work<\/strong><\/h2>\r\nWhere work happens has changed. High-speed internet, cloud computing, video conferencing, and collaboration platforms (Microsoft Teams, Zoom, and Slack) allow millions of employees to work from almost anywhere.\r\n\r\nRemote work offers several advantages:\u00a0 lower operating costs, increased flexibility, access to a larger talent pool. Employees often benefit from reduced commuting time, improved work-life balance, and greater flexibility in managing their schedules.\r\n\r\nHowever, remote work also presents challenges: Managers may struggle to maintain communication, monitor productivity, and build strong team relationships. Employees can experience feelings of isolation, difficulty separating work from personal life, and \u201cZoom fatigue\u201d from spending long hours in virtual meetings.\r\n\r\nInformation systems have made remote work possible, but organizations must carefully balance flexibility with collaboration, employee well-being, and organizational culture.\r\n\r\n
\r\n\r\nAI in Hiring<\/strong><\/h2>\r\nMany companies now use AI-powered software to screen resumes, rank applicants, analyze video interviews, and even predict which candidates are most likely to succeed. These systems can help organizations review thousands of applications quickly, reduce administrative work, and identify qualified candidates.\r\n\r\nHowever, using AI in hiring also raises important ethical concerns. AI systems learn from historical data, and if that data contains bias, the AI may unintentionally favor or disadvantage certain groups of applicants. In some cases, qualified candidates may be rejected simply because their resumes don\u2019t contain specific keywords that the software is programmed to recognize.\r\n\r\nAs a result, many experts argue that AI should support human decision-making rather than replace it entirely to make sure hiring decisions are fair, transparent, and based on the whole person rather than just an algorithm.\r\n\r\nDid You Know? Studies estimate that more than 90% of large employers now use some form of applicant tracking system or AI-assisted screening before a human recruiter reviews many resumes.<\/em>\r\n\r\n
\r\n\r\n \r\n\r\n11.9 IS in the Real World<\/h1>\r\n<\/header>\r\n
![\"dominos](\"https:\/\/pressbooks.ulib.csuohio.edu\/business-essentials-for-future-professionals\/wp-content\/uploads\/sites\/209\/2026\/04\/Dominos_pizza_logo.svg-300x300.png\"){kind=logo}
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<\/h3>\r\n
<\/h3>\r\n
*Information systems touch every department in a business.<\/h3>\r\n
\r\n\r\nHere\u2019s how:\r\n\r\n \t
E-Commerce and IS<\/strong><\/h2>\r\nOnline retail runs entirely on information systems. When you buy something on Amazon, an IS processes your payment, checks inventory, assigns a warehouse, routes the shipment, sends tracking updates, and updates your purchase history. All of that happens in seconds.\r\n\r\n
\r\n\r\nCareers in Information Systems<\/strong><\/h2>\r\nIS is one of the fastest-growing fields in the job market.\r\n
\r\n\r\nSome paths include:\r\n\r\n \t
\r\n\r\nClosing<\/strong><\/h2>\r\n
EXTRA LEARNING RESOURCES<\/h1>\r\n<\/header>\r\n
\r\n\r\n\r\nInfographic<\/a>\r\n\r\nBrief Audio Overview<\/a>\r\n\r\nDeep Dive Audio Overview<\/a>\r\n\r\nShort Video Overview\r\n\r\nVideo Explainer<\/a>\r\n\r\n<\/div>\r\n<\/div>\r\n<\/div>\r\n \r\n\r\n<\/header>","rendered":"INTRODUCTION<\/h1>\n
Information Systems<\/h2>\n
<\/p>\n
\n\nCHAPTER OUTLINE<\/strong><\/h1>\n