Information System Terminology (DP IB Business Management)

Key Information System Terminology

Data Analytics

• Data analytics involves transforming raw data into useful information to uncover patterns, correlations, trends and insights 
  

• Data analytics has become increasingly important to businesses in today's data-driven world

  • It helps organisations to gain a competitive advantage and make informed decisions

  • Data-driven decision making tends to be less risky than pursuing hunches

Diagram: illustrating key components of data analytics

Types of Data Analytics

Databases

• A database provides a structure for stored data 

• Typically electronic databases allow for swift data input, storage, protection and retrieval of information

• Setting up and maintaining databases can be costly

  • Data must be kept secure

  • Database managers may be required to ensure databases are fit for purpose

Diagram: database use in a university

Cybersecurity & cybercrime

• Cybersecurity includes systems used to protect computer networks from theft or unauthorised access of data

• Cybercrime is illegal activity related to the use of computer or network devices

  • It is often related to financial or commercial gain 

  • It is a significant risk to business - according the UK government cybercrime cost British businesses an average of £1,100, with 69% of large businesses reporting a significant cyber-attack in 2022

    Common Forms of Cybercrime

• A business can protect itself against cybercrime in a number of ways

Ways to Protect Business Systems from Cybercrime

Critical Infrastructures

• Critical infrastructures are IT-based systems and facilities that are central to the effective operation of a business

• Examples of critical infrastructures include

  • Artificial neural networks

  • Data centres

  • Cloud computing

• Artificial neural networks (ANNs) are computer systems inspired by the way the human brain works

  • They automate business tasks in some well-known businesses 

    • Chatbots are used by businesses such as Next Retail to respond to customer service queries

    • Insurance companies such as Admiral use ANN's to detect fraud in insurance claims where unusual patterns  need to be identified

    • Manufacturers including Toyota and Hyundai use ANN's to monitor machinery and predict when equipment is likely to fail so timely maintenance tasks can be carried out

    • Large retailers such as Tesco use ANNs to monitor temperatures in stores' refrigerated units to ensure that perishable goods are stored safely

• Data centres are physical spaces that hold important applications and data on behalf of a business

  • Their components include mainframes, servers, routers, firewalls and storage systems

  • Services such as data backup, security, database management and storage, email and file sharing and virtual communications systems are provided by data centres

• Cloud computing is similar to a data centre though applications and data are stored online rather than in a physical location

  • Examples include Google Drive, Dropbox and Apple's iCloud

  • Remote servers and online networks are used to store and share data

Virtual Reality, the Internet & Artificial Intelligence

Virtual reality

• Virtual reality (VR) allows users to explore and interact with a realistic 3-dimensional (3D) environment created using software

  • VR can be used in a number of ways by businesses

Business use of Virtual Reality 

• In addition, virtual reality can help businesses to deliver realistic training and has been used by some large businesses to develop immersive advertising

The Internet of things

• The Internet of Things (IoT) refers to the connection of everyday objects to the internet which allows them to send and receive data for various purposes

  • In an IoT system tasks are performed with little or no human intervention

  • Devices can range from simple household items such as refrigerators and smart speakers to complex industrial machinery

• Businesses such as Amazon have enjoyed commercial success with devices such as the Echo and its Alexa software

• Devices can also be used within businesses to improve the efficiency of processes 

  • Volvo car dealerships use data from embedded sensors in vehicles to offer timely maintenance to owners and ensure appropriate parts are in stock

  • Smart climate control systems are used in Sainsbury's supermarket distribution hubs to ensure perishable goods are not wasted

Artificial Intelligence

• Artificial intelligence (AI) allows machines to complete tasks that normally require human intelligence or reactions

• Although in its infancy, some businesses are enjoying considerable commercial success in the field

Examples of Top AI Businesses in 2023

• AI can carry out numerous business functions and improve their efficiency

  • In Human Resources AI filters job applications and compiles shortlists for interview

  • Logistics have been improved by the use of AI-powered tools such as Google Maps which gather and process real time travel conditions

  • AI manages some customer service functions, powering chatbots and improving the efficiency of search engines

  • Automatic payment systems such as Paypal incorporate AI to improve financial management