Chapter 4
IT Infrastructure:  Hardware and Software

 

Student Objectives

• Identify and describe the components of IT infrastructure.
• Identify and describe the major types of computer hardware, data storage, and input and output technology.
• Identify and describe the major types of computer software used in business.
• Assess the most important contemporary hardware and software trends.
• Evaluate the principal issues in managing hardware and software technology.
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Chapter Outline

4.1       IT Infrastructure: Computer Hardware

                    Infrastructure Components
Types of Computers
Storage, Input and Output Technology
Contemporary Hardware Trends
4.2       IT Infrastructure: Computer Software
                  Operating System Software
Application Software and Desktop Productivity Tools
Software for the Web: Java, Ajax, and HTML
Web Services
Software Trends
4.3       Managing Hardware and Software Technology
Capacity Planning and Scalability
Total Cost of Ownership (TCO) of Technology Assets
Using Technology Service Providers
Managing Software Localization for Global Business
4.4       Hands-On MIS

      
Key Terms

The following alphabetical list identifies the key terms discussed in this chapter.  The page number for each key term is provided.

Ajax, 138	Object, 132
Application server, 122	Office 2007, 135
Application software, 118	Offshore software outsourcing, 143
Autonomic computing, 127	On-demand computing, 144
Batch processing, 125	Online processing, 125
C, 132	Open-source software, 132
Capacity planning, 142	Operating system, 129
CD-ROM (compact disk read-only memory), 123	Output devices, 124
Centralized processing, 121	Outsourcing, 143
Client, 121	Personal computer (PC), 119
Client/server computing, 121	Presentation graphics, 135
Cloud computing, 140	Query languages, 132
COBOL (COmmon Business Oriented Language), 132	SaaS (Software as a Service), 144
Data management software, 118	Scalability, 142
Digital video disk (DVD), 123	Server, 119
Distributed processing, 121	Service level agreement (SLA), 143
Edge computing, 125	Service-oriented architecture (SOA), 139
Extensible markup language (XML), 138	Software package, 133
Fourth-generation languages, 132	Spreadsheet, 134
Graphical user interface (GUI), 130	Storage area networks (SANs), 123
Grid computing, 121	Supercomputer, 121
Hypertext markup language (HTML), 138	System software, 118
Input devices, 124	Total cost of ownership (TCO), 142
Java, 135	UNIX, 130
Legacy systems, 119	Virtualization, 127
Linux, 131	Visual programming language, 132
Magnetic disk, 122	Web browsers, 135
Magnetic tape, 123	Web hosting service, 143
Mainframe, 120	Web server, 122
Mashups, 141	Web services, 138
Midrange computers, 120	Widget, 141
Nanotechnology, 125	Windows Vista, 130
N-tier client/server architectures, 122	Word processing software, 133
	Workstation, 119

 

Teaching Suggestions

Your students’ knowledge and comfort level with technology is likely to vary, making this chapter difficult to teach and test. The technically-adept know most of this material, and some of the nontechnical types may not find the chapter’s contents particularly interesting. You may want to approach the chapter from a business standpoint—the role of technology in the success of an organization.

One way to begin the chapter discussion is to present several horror stories. (Your students may even be able to provide stories of their own.) For example, many firms have found moving to a client/server architecture is not the dream they had been led to believe. The shortage of support, programming, and management tools, as well as the shortage of staff who understand the technology and programs in such an environment, has doomed many such changes to client/server architecture. Also, you should mention to your students that programming problems have cost organizations millions of dollars and provide examples of programming projects that simply failed.

The opening case, “University of Pittsburgh Medical Center’s Technology Cure,” provides an excellent example of how a business can inadvertently create a quagmire with technology. UPMC had a separate server for every application; servers were running a number of different operating systems; it was using technologies from many different vendors. It also shows how outsourcing is not always a bad thing.  Sometimes an organization must use third-party vendors who specialize in technology, rather than trying to do everything itself.

The vignette introduces a new term, virtualization, which most students probably haven’t heard about.  It’s a great way to show even the most experienced students that there’s always something new in technology.

Section 4.1, “IT Infrastructure: Computer Hardware”, introduces students to essential computer hardware terminology and concepts. Students are introduced to the five major components that make up an IT infrastructure.  These include: computer hardware, computer software, data management technology, networking and telecommunications technology, and technology services. 

If possible, bring a system unit to class and allow students to see the computer systems parts. Students are often eager to see the inside of a computer and also see that the machine is not as mysterious as it first appears.  You should consider organizing a tour of your university’s IT facilities or the facilities of a local company. Students are often eager to see information technology in action. 

Students should understand that organizations need to select the most appropriate hardware to handle their business requirements.  The text introduces students to the different categories of computers and computer systems, i.e. PCs, workstations, midrange, mainframe, supercomputers, virtual supercomputer (grid-computing), and computer networks and client/server computing.  You should spend some time discussing the capabilities of the different computer types. This is a good place to discuss the trends that are occurring with technology. One part that is familiar to many of us is the continual increasing memory, speed, and storage capabilities of personal computers.

Consider spending most of your time and students’ on hardware trends: nanotechnology, edge computing, autonomic computing, virtualization, and multicore processors.  That’s where many businesses are headed and students are likely to bump into these trends when they enter the workforce.

Interactive Session: Technology: Computing Goes Green

Case Study Questions

• What business and social problems does data center power consumption cause?

 

Excessive power consumption uses vast amount of electricity that must be generated through hydroelectric plants or coal-fired power plants.  While hydroelectric generation plants are less stressful on the environment than coal-fired, nevertheless, they do pull resources from more useful purposes.  Coal-fired power plants generate huge amounts of carbon dioxide into the atmosphere which some scientists and politicians claim is a major cause of global warming.  Social implications of increased power consumption point to global warming.

• What solutions are available for these problems? Which are the most environment-friendly?

 

Some of the solutions to cut power consumption discussed in the case study are a good beginning. Building data centers that take advantage of hydroelectric power generation rather than coal-fired power plants; renewable energy projects; alternative energy; employee telecommuting; thin client computers, software that automatically turns computers off; more efficient chips.  Perhaps the most environment-friendly solutions are those that control the hardware and software, thereby controlling the problem at its source.  Virtualization holds great promise as a way to reduce power requirements by reducing the number of servers required to run applications.

• What are the business benefits and costs of these solutions?

 

Even though it may cost a business up-front money to install hardware and software that reduces power requirements, it will save a business a lot of money in the long run by reducing the amount it pays for electricity to run the equipment and cool it at the same time. Businesses that reduce their power needs help the environment and can promote themselves as environment-friendly.

• Should all firms move toward green computing? Why or why not?

 

All firms should make some effort to reduce their power requirements and promote green computing.  From a business standpoint it makes sense to reduce costs, both short term and long term. 

 

MIS In Action

Perform an Internet search on the phrase “green computing” and then answer the following questions.

 

• How would you define green computing?

Green computing is a way to reduce the impact on the environment and reduce resources consumption that may be detrimental to the environment by using more efficient hardware and better software.

“Still, IT execs would be wise to keep an eye on more than the economics of energy-efficient computing. Energy consumption has gotten so huge--U.S. data centers consume as much power in a year as is generated by five power plants--that policy makers are taking notice and considering more regulation. A group of government and industry leaders is trying to set a clear standard for what constitutes a "green" computer, a mark that IT execs might find themselves held to. Global warming concerns could spark a public opinion swing--either a backlash against big data centers or a PR win for companies that can paint themselves green. IT vendors are piling on, making energy efficiency central to their sales pitches and touting eco-friendly policies such as "carbon-neutral computing."

One under-the-radar example of what's changing is a long acronym you'll start hearing more: EPEAT, or the Electronic Product Environmental Assessment Tool. EPEAT was created through an Institute of Electrical and Electronics Engineers council because companies and government agencies wanted to put green criteria in IT requests for proposals. EPEAT got a huge boost on Jan. 24 when President Bush signed an executive order requiring that 95% of electronic products procured by federal agencies meet EPEAT standards, as long there's a standard for that product.” (Information Week, What Every Tech Pro Should Know About 'Green Computing', Marianne Kolbasuk McGee, March 10, 2007)

• Who are some of the leaders of the green computing movement? Which corporations are leading the way? Which environmental organizations are playing an important role?

 

Some of the major corporations leading the green computing initiative are the same major players in other computing venues: IBM, HP, and Dell. Other major corporations who are going green as a way to save money on power consumption include most Wall Street firms (since they use a tremendous amount of power in their data centers), banks like Wells Fargo, and Amazon.com.

“IT management isn't the first place you would start looking for environmental activists. But in 2006, the people in charge of buying and deploying computer technology found the concept of green computing extra compelling. Analysts say the main reason is cost, energy and space savings; if it's also good for the environment, that's icing on the cake. "Even if a customer is not looking at IT purchasing from an environmental-impact perspective, things like power management and energy efficiency are now a TCO [total cost of ownership] and infrastructure issue," John Frey, manager of corporate environmental strategies at HP, told internetnews.com. The way things are going, Gartner predicts that by 2008, 50 percent of current datacenters will have insufficient power and cooling capacity to meet the demands of high-density equipment. "With the advent of high-density computer equipment such as blade servers, many datacenters have maxed out their power and cooling capacity," said Michael A. Bell, research vice president for Gartner. "It's now possible to pack racks with equipment requiring 30,000 watts per rack or more in a connected load. This compares to only 2,000 to 3,000 watts per rack a few years ago." And energy costs are rising. HP engineering research estimates that for every dollar spent on information technology, a company can expect to spend the same or more to power and cool it. As companies add more performance, they can expect those costs to continue rising. (Internetnews.com, Greener Systems an Unstoppable Trend, David Needle, December 27, 2006)

Organizations that are playing a major role in green computing include the Environmental Protection Agency and Institute of Electrical and Electronics Engineers (see article in the answer to question 1.

• What are the latest trends in green computing? What kind of impact are they having?

 

A few trends in green computing include purchasing green desktops—those built to reduce power needs; more efficient server computers; increase the use of virtualization as a way to reduce the number of servers needed in data centers.  2007 saw the beginning of the green computing movement so it’s a bit early to determine the overall impact all the initiatives are having.  Much of the impetus behind the ‘green computing’ movement is not necessarily to save the environment, although it will certainly help reduce the impact on the environment.  Rather, many companies are seeking ways to reduce power costs; going green is a way to do that.

• What can individuals do to contribute to the green computing movement? Is the movement worthwhile?

 

Individuals can contribute to the green computing movement by purchasing computers that have Energy Star ratings, turning off equipment they aren’t using, recycling computer equipment, and supporting companies that are going green.

Section 4.2, “ IT Infrastructure:  Computer Software” introduces students to the different types of software. You might take a quick survey of your students to see what operating systems and application software they currently use. Most of the answers will probably revolve around the Windows operating systems and Microsoft Office suite. However, it is possible that some of your students may use software that the rest of the class is not as familiar with. If this occurs, have your students explain why they use that particular operating system and application software.

Explain the business implications of choosing an operating system because they affect business capabilities. Some operating systems are better designed for networking, and other operating systems are better for speed.

Table 4.3 provides a list of the leading PC operating systems. Ask your students to research these different operating systems. As part of their research, ask them to identify the features of the operating systems, as well as the market share for each operating system. Which is the most appropriate operating system? Also, ask your students to investigate the application programming languages mentioned in the text (C, C++, COBOL, and Visual Basic).  Which is the most appropriate programming language for business?

Many of the more technically adept students might argue over what should be the appropriate operating system or the appropriate programming language. Students should be warned that in their managerial careers, they may have to sort out these issues because the selection of the proper operating system or software package must support the business, and the technical people may not understand that. You should talk about the superiority of some languages for some tasks. For instance, in Web database development applications, Visual Basic is the language of choice. VB.NET is the first version of the language that was truly object oriented. Point out to students that there are many examples of companies, organizations, and governments choosing the wrong language for the wrong problem and creating disaster.

The most interesting part of this section, and one students may not be familiar with, is the Software for the Web and Software Trends.  Since most students use the Web and Internet daily, you can have them explore how new software technologies are making their experiences richer and more efficient.  Have them explore cloud computing, mashups and widgets, on the Web sites they use the most.  If any students use MySpace, Facebook, or any of the other social networking sites, ask them to demonstrate how they use these new technologies.

Interactive Session: Organizations: Will Google Take Over the Desktop?

Case Study Questions

• What are the benefits of using Google Apps? What kinds of businesses are most likely to benefit? What kinds are least likely to benefit?

 

The major benefit of using Google Apps is cost reduction. The software is much cheaper than Microsoft Office: only $50 per year per employee—one tenth the cost of Microsfot Office Professional Edition.  Companies that use Google Apps save support costs because they don’t have to hire their own IT workers to maintain the software.

Small and medium-size businesses are most likely to benefit from using Google Apps instead of Microsoft Office. Businesses that need only basic functionality in word processing and spreadsheet software are most likely to benefit. Businesses that don’t want to, or can’t afford to, hire IT support staff or build their own data centers are likely to benefit.

Businesses that need the ability to work offline will not benefit from Google Apps since users must access Google’s Web site in order to use the application software. Businesses that require data security will not benefit because Google doesn’t encrypt data in its systems. Companies that need spreadsheet and word processing programs that are powerful and rich in features will not benefit from Google Apps.

• What reasons might a business have to continue using Microsoft Office for desktop productivity?

 

Businesses that need the powerful spreadsheet software for data processing should continue using Microsoft Office.  Those that need database and electronic presentation software should stick with Microsoft Office. Companies that want truly integrated business applications and additional collaboration tools should stay with Microsoft Office. Companies that have a lot of workers who need offline software processing will be better off staying with Microsoft Office.

• Search the Web for an article title Microsoft Office Live Vs. Google Apps for Your Domain by Preston Gralla from September 2006.  Do you agree with the author’s conclusion?

 

The article presents the pros and cons for both Microsoft Office Live and Google Apps.  The author’s basic conclusion is that if a business needs superior e-mail, calendar and minimal productivity software then Google Apps is the best choice.  However, if a business is primarily focused on building a Web site, then Microsoft’s Office Live is the better choice.  The author supports the basic notion that a business should select software based on its business needs and goals rather than choosing what’s popular.

 

MIS In Action

Explore the Google Apps Web site.  View the quick tour and comprehensive overview of the product, noting all the features and capabilities.  Then answer the following question.

• How could Google Apps be used by a small but growing events planning business to run the company?  The business consists of an owner and three employees, who work with both individuals and companies to plan parties and large meetings.  Two live in New York City, one lives in Washington D.C., and one lives in Boston.  They all have laptops connected to the Internet. Their work involves soliciting clients, communicating with clients and vendors such as photographers, printers, musicians, caterers, and florists, and preparing budgets and bills for services.

 

Because all of the software and data are stored on Google’s servers, both are accessible from any location. That feature serves the example business quite well since the employees are located in different geographic regions.  The ability for the employees to collaborate online quickly and easily with other businesses is a great feature. The calendar feature alone is a great tool the business can use to communicate events with photographers, printers, caterers, and florists.  The feature allows a user to initially enter an event in the calendar and then send the notice automatically via email to others.  If the recipient also uses Google calendars then the event is automatically posted to that calendar.

The software also provides instant messaging and chat functions.  It also provides Voice over Internet Protocol (VoIP) telephony that’s free. It provides up to 25 gigabytes of e-mail storage free of charge.

The software is easy to customize for each user. Because Google supplies all the support and server storage, the small business doesn’t need to hire anyone to help it with IT requirements.

 

Section 4.3, “ Managing Hardware and Software Technology” discusses business issues with which most students will not be familiar.  It stresses the importance of understanding the technology requirements for the digital firm and electronic commerce.  Students may be surprised to learn that the total cost of ownership of technology assets extends beyond the purchase price of hardware and software.  It’s not something many of them (or us) really think about. Outsourcing has gotten such a bad rap over the years that you may find some preconceived notions about it among your students.  Have them research several different ways in which a business can outsource its technology needs such as Web hosting services and on-demand computing. 

Section 4.4, “ Hands-on MIS”

Improving Decision Making: Making the Rent vs. Buy Decision for Hardware and Software: Dirt Bikes USA

Software skills: Spreadsheet formulas, electronic presentation software (optional)
Business skills: Technology rent vs. buy decision, TCO analysis

Dirt Bikes would like to implement new production planning, quality control, and scheduling software for use by 25 members of its manufacturing staff.  Management is trying to determine whether to purchase the software from a commercial vendor along with any hardware required to run the software or to use a hosted software solution from an application service provider.  (The hosted software runs on the ASP’s computer.) You have been asked to help management with this rent vs. buy decision by calculating the total cost of each option over a three-year period.

• Use your spreadsheet software to calculate the total cost of renting or purchasing this software over a three-year period.  Identify the lowers-price alternative that meets Dirt Bike’s requirements.

 

An example solution file can be found in the Microsoft Excel file named: Ess8ch04 running case solution.xls.

• What other factors should Dirt Bikes consider besides cost in determining whether to rent or buy the hardware and software?

 

Considerations other hardware and software costs include ongoing administration costs for hardware and software upgrades, maintenance, technical support, training, and even utility and real estate costs for running and housing the technology. “Hidden costs” for support staff, downtime, and additional network management are difficult to compute but very necessary.

• (Optional) If possible, use electronic presentation software to summarize your findings for management.

 

Improving Decision Making: Using a Spreadsheet to Evaluate Hardware and Software Options

Software skills: Spreadsheet formulas
Business skills: Technology pricing

Prepare a spreadsheet showing your research results for the desktop systems, for the printers, and for the software.  Use your spreadsheet software to determine the desktop system, printer, and software combination that will offer both the best performance and pricing per worker.  Because every two workers will share one printer (15 printers/30 systems), assume only half a printer cost per worker in the spreadsheet.  Assume that your company will take the standard warranty and service contract offered by each product’s manufacturer.

This project requires students to use their Web research skills to obtain hardware and software pricing information, and then use spreadsheet software to calculate costs for various system configurations. Answers may vary, depending on when students accessed the vendors’ Web sites to obtain pricing information. The sample solution files provided here are for purposes of illustration and may not reflect the most recent prices for desktop hardware and software products.

An example solution file can be found in the Microsoft Excel file named: Ess8ch04solutionfile.xls.

 

Improving Decision Making: Using Web Research to Budget for a Sales Conference

Software skills: Internet-based software
Business skills: Researching transportation and lodging costs

The Foremost Composite Materials Company is planning a two-day sales conference for October 19-20, starting with a reception on the evening of October 18. The conference consists of all-day meetings that the entire sales force, numbering 125 sales representatives and their 16 managers, must attend. Each sales representative requires his or her own room and the company needs two common meeting rooms, one large enough to hold the entire sales force plus a few visitors (200) and the other able to hold half the force.

Management has set a budget of $85,000 for the representatives’ room rentals. The hotel must also have such services as overhead and computer projectors as well as business center and banquet facilities. It also should have facilities for the company reps to be able to do work in their rooms and to enjoy themselves in a swimming pool or gym facility. The company would like to hold the conference in either Miami or Marco Island, Florida. 

Foremost management usually likes to hold such meetings in Hilton- or Marriott-owned hotels. Use their sites (http://www.hilton.com) and (http://www.marriott.com) to select a hotel in whichever of these cities that would enable the company to hold its sales conference within its budget.

Link to the two sites’ home pages, and search them to find a hotel that meets Foremost’s sales conference requirements. Once you have selected the hotel, locate flights arriving the afternoon prior to the conference because the attendees will need to check in the day before and attend your reception the evening prior to the conference. Your attendees will be coming from Los Angeles (54), San Francisco (32), Seattle (22), Chicago (19) and Pittsburgh (14). Determine costs of each airline ticket from these cities. When you are finished, create a budget for the conference. The budget will include the cost of each airline ticket, the room cost, and $60 per attendee per day for food.

What was your final budget? Which did you select as the best hotel for the sales conference and why?

The students will likely find hotels that interest them personally. The template that has been provided has a checklist for all of the hotel requirements to help keep them on track. You can show this in class or distribute it for your students to use. They should also write a brief report detailing why they chose the hotel they did and price should not be the only issue. Several airlines’ Web sites are available now and the students will choose various ones based on their knowledge of airlines. Some will go directly to the airline site and others will go to discounters. Ask them to rate the use of the Web site in their report as well.

An example template can be found in the Microsoft Excel file named: Ess8ch04 electronic business project template.xls.

 

Review Questions

• What are the components of IT infrastructure?

 

Define information technology (IT) infrastructure and describe each of its components.

A firm’s IT infrastructure provides the foundation, or platform, for supporting all the information systems in the business. 

The five major components of an information technology (IT) infrastructure are:

• computer hardware: technology for computer processing, data storage, input, and output.
• computer software: includes both system software and application software.
• data management technology: organizes, manages, and processes business data concerned with inventory, customers, and vendors.
• networking and telecommunications technologies; provides data, voice, and video connectivity to employees, customers, and suppliers.
• technology services: external consultants who run and manage infrastructure components.

 

2.  What are the major computer hardware, data storage, input, and output technologies used in business?

List and describe the various types of computers available to businesses today.

Table 4.1 illustrates the categories of computers and their relative performance.

• Personal digital assistants (PDAs): generally used to perform one task at a time by the operator.  Most of the processing power is used to draw the screen and handle voice messages.
• Personal computers :generally used when working alone or with a few other people in a small business.
• Servers: specifically optimized to support a computer network, enabling users to share files, software, peripheral devices, or other network resources.
• Mainframes: large-capacity, high performance computers that process vast amounts of data very rapidly.
• Supercomputers: specially designed and more sophisticated computers used for tasks requiring extremely rapid and complex calculations with thousands of variables, millions of measurements, and thousands of equations.
• Distributed computing: also known as grid computing; geographically remote computers connected into a single network to create a “virtual supercomputer” by combining the computational power of all computers on the grid.

 

Define the client/server model of computing and describe the difference between a two-tiered and N-tier client/server architecture.

Client/server computing splits processing between “clients” and “servers”.  Both are on the network but each machine is assigned functions it is best suited to perform.  The client is the user point of entry for the required function and is normally a desktop computer, workstation, or laptop computer.  The user generally interacts directly only with the client portion of the application, often to input data or retrieve data for further analysis. The server provides the client with services.  Servers store and process shared data and also perform back-end functions not visible to users, such as managing network activities. 

Two-tiered client/server architecture is the simplest form of client/server network. It consists of a client computer networked to a server computer, with processing split between the two types of machines. 

N-tier client/server architecture is more complex than the simple two-tiered client/server network.  In this network, the work of the entire network is balanced over several different levels of servers, depending on the kind of service being requested.

List the most important secondary storage media and the strengths and limitations of each?

The principal secondary storage technologies are magnetic disk, optical disk, magnetic tape, and storage networks.

The most important secondary storage media are magnetic disk, optical disk, and magnetic tape. Magnetic disks are the most widely used secondary storage medium and include floppy and hard disks. Magnetic disks are convenient to use, permit direct access to individual records, are reasonably priced, and provide fast access speeds. Hard drives and USB flash drives provide fast access to data and larger storage capacities. RAID technology packages more than 100 smaller disk drives with a controller chip and specialized software in a single larger unit to deliver data over multiple paths simultaneously.

Optical disks store data at far greater densities than conventional magnetic disks, making them valuable for storing vast quantities of data such as reference materials or documents. There are several types of optical disk systems. CD-ROM is read-only storage, while CD-RW allows users to rewrite data to the disk. DVD is a high-capacity, optical storage medium, capable of storing a minimum of 4.7 gigabytes of data.

Information stored on magnetic tape is more time consuming to access than information stored on a magnetic disk. Magnetic tape sequentially stores and accesses information, and each reel of tape must be individually mounted and dismounted. Tape storage is cheaper than disks, useful for batch applications (such as payroll), and for archiving large quantities of data that do not require immediate usage or are used every day. Tape storage is also more stable than disk storage. Disk technology is most useful for online applications, where direct access is required and for databases where interrelationships among records exist.

Storage area networks (SANs) connect multiple storage devices on a separate high-speed network dedicated to storage. The SAN creates a large central pool of storage that can be rapidly accessed and shared by multiple servers.

List and describe the major computer input and output devices.

Table 4.2 lists the major input and output devices. Input devices include keyboard, computer mouse, touch screen, optical character recognition, magnetic ink character recognition, pen-based input, digital scanner, audio input, sensors, and radio frequency identification. Output devices include cathode ray tube, printers, and audio output.

The keyboard is the principal method of data entry. Touch screens allow the user to touch the surface of a sensitized video display monitor with a finger or a pointer to make a selection. Optical character recognition (OCR) devices translate specially designed marks, characters, and codes into digital form. Magnetic ink character recognition (MICR) readers read magnetic characters on documents such as bank checks. Pen-based input devices are mainly handwriting recognition devices used on touch-sensitive screens and are often seen with package delivery persons. Digital scanners translate images such as pictures or documents into digital form. Audio input devices compare the electrical patterns produced by the speaker’s voice to a set of prerecorded patterns and accept the sounds when a pattern is recognized. Sensors are devices that collect data directly from the environment for input into a computer system. Radio frequency identification use tags that incorporate microchips to transmit information about items and their location to special RFID readers.

A cathode ray tube (CRT) displays the output on a screen much like a television set. Printers produce printed copy of information output by the computer. There are impact printers (dot matrix) and non-impact printers (laser, inkjet, or thermal transfer). Audio output devices are voice output devices that convert digitally stored words into intelligent speech.

Distinguish between batch and online processing.

Batch processing involves grouping transactions together and then processing these transactions at some later point to update a master file. Online processing involves entering a transaction directly into the computer and processing it immediately. With online processing, information in the system is always up-to-date and current.

 

3.  What are the major types of computer software used in business?

Distinguish between application software and system software and explain the role played by the operating system of a computer.

System software surrounds and controls access to the hardware.  It manages and controls a computer’s activities. Some types of system software consist of computer language translation programs that convert programming languages into machine language that can be understood by the computer and utility programs that perform common processing tasks, such as copying, sorting, or computing a square root.  The operating system allocates and assigns system resources, schedules the use of computer resources and computer jobs, and monitors computer system activities.

Application software works through the system software in order to develop specific business applications. 

List and describe the major PC and server operating systems.

Table 4.3 lists and describes the major PC operating systems.

• Windows Vista:  most recent Windows operating system with improved security, desktop searching, and synchronization with mobile devices, cameras, and Internet services.
• Windows XP: used on PCs with versions for both home and corporate users.  Features support of Internet access, multimedia, and group collaboration, along with networking, security, and corporate management capabilities
• Windows Server 2003: most recent Windows OS for servers.
• UNIX: used for powerful PCs, workstations, and network servers.  Supports multitasking, mutiuser processing, and networking. Is portable to different models of computer hardware.
• Linux: Open source, reliable alternative to UNIX and Windows OS that runs on many different types of computer hardware.  Can be modified by software developers.
• Mac OS X:  OS for Macintosh computers that is stable and reliable, with powerful search capabilities, support for video and image processing, and an elegant user interface.  Most recent version is Leopard.

 

Name and describe each category of fourth-generation software tool and explain how fourth-generation languages differ from conventional application programming languages

The seven categories of fourth-generation tools: PC software tools, query languages, report generators, graphics languages, application generators, application software packages, and very high-level programming languages. Table 4.4 provides a brief description of these categories.

Fourth-generation languages are extremely sophisticated languages that enable end users to perform programming tasks with little or no professional programmer assistance. They also enhance the productivity of professional programmers. For example, very high-level programming languages, query languages, or application generators have features that can be employed by end users or less-skilled programmers and can dramatically increase application development productivity.

Fourth-generation languages tend to be nonprocedural, or less procedural, than conventional programming languages.  Procedural languages require specification of the sequence of steps, or procedures, that tell the computer what to do and how to do it.  Nonprocedural languages need only specify what has to be accomplished rather than provide details about how to carry out the task.  The main differences between fourth-generation tools and conventional programming languages are the degree of user-friendliness and the ability to perform the same functions with fewer lines of program instructions.

 

Name and describe the major desktop productivity software tools.

Word processing: allows users to make changes in the document electronically in memory, eliminating the need to retype entire pages to make corrections. It often includes advanced features such as spelling checkers and thesaurus programs.

Spreadsheets: composed of a grid of columns and rows and are good at performing calculations on interrelated pieces of data. Used for applications in which numerous calculations with pieces of data must be related to each other.  When you change a value or values, all other related values on the spreadsheet will be automatically recomputed.  Spreadsheets provide computerized versions of traditional financial modeling tools and provide an easy-to-use method of performing what-if analysis.

Data management: used for creating and manipulating lists and for combining information from different fields. Data management software typically has facilities for creating files and databases to store, modify, and manipulate data for reports and queries.

Presentation graphics: allow users to create professional quality graphics presentations. This software can convert numeric data into charts and other types of graphics and can include multimedia displays of sound, animation, photos, and video clips.

Software suites: combine the functions of the most important microcomputer software packages, such as spreadsheets, word processing, graphics, and data management. This integration provides a more general-purpose software tool and eliminates redundant data entry and data maintenance. 

Web browsers: easy-to-use software tools for accessing the Web and the Internet.   Web browsers have become the primary interface for accessing the Internet or for using networked systems based on Internet technology.

 
Explain how Java and HTML are used in building applications for the Web?

Java is used for building applications that run on the Web and HTML is used for creating Web pages.  Java, is an operating system that is processor-independent. Its object-oriented programming language has become the leading interactive programming environment for the Web.  Java enables users to manipulate data on networked systems using Web browsers, reducing the need to write specialized software. 

Hypertext markup language (HTML) is a page description language for specifying how text, graphics, video, and sound are placed on a Web page and for creating dynamic links to the Web pages and objects.  HTML programs can be custom written, but they also can be created using the HTML authoring capabilities of Web browsers or of popular word processing, spreadsheet, data management, and presentation graphics software packages. HTML editors are more powerful HTML authoring tool programs for creating Web pages.

 

Define Web services, describe the technologies they use, and explain how Web services benefit business.

Web services offer a standardized alternative for dealing with integration across various computer platforms.  Web services are loosely coupled software components based on XML and open Web standards that are not product specific and can work with any application software and operating system.  They can be used as components of Web-based applications linking the systems of two different organizations or to link disparate systems of a single company.  Web services are not tied to a particular operating system or programming language. Different applications can use them to communicate with each other in a standard way without time-consuming custom coding.

Businesses use Web services to tie their Web sites with external Web sites creating an apparently seamless experience for users.  The benefit derives from not having to re-create applications for each business partner or specific functions within a single company.

• What are the most important contemporary hardware and software trends?

 

Define and describe grid computing, edge computing, autonomic computing, virtualization, and multicore processing.

Grid computing connects geographically remote computers into a single network to create a “virtual supercomputer” by combining the computational power of all computers on the grid. 

Edge computing is a multitier, load-balancing scheme for Web-based applications in which significant parts of Web site content, logic, and processing are performed by smaller, less expensive servers located nearby the user in order to increase response time and resilience while lowering technology costs.

Autonomic computing is an industry-wide effort to develop systems that can configure themselves, optimize and tune themselves, heal themselves when broken, and protect themselves from outside intruders and self-destruction.

Virtualization is the process of presenting a set of computing resources (such as computing power or data storage) so that they can all be accessed in ways that are not restricted by physical configuration or geographic location. Server virtualization enables companies to run more than one operating system at the same time on a single machine.

Multicore processing used integrated circuit to which two or more processors have been attached for enhanced performance, reduced power consumption and more efficient simultaneous processing of multiple tasks.

Explain why open-source software is so important today and its benefits for business.

Open-source software provides all computer users with free access to the program code so they can modify the code, fix errors in it, or to make improvements.  Open-source software is not owned by any company or individual.  A global network of programmers and users manage and modify the software.  By definition, open-source software is not restricted to any specific operating system or hardware technology. Several large software companies are converting some of their commercial programs to open source.

Linux is the most well-known open-source software.  It’s a UNIX-like operating system that can be downloaded from the Internet, free of charge, or purchased for a small fee from companies that provide additional tools for the software.  It is reliable, compactly designed, and capable of running on many different hardware platforms, including servers, handheld computers, and consumer electronics.  Linux has become popular during the past few years as a robust low-cost alternative to UNIX and the Windows operating system. 

Thousands of open-source programs are available from hundreds of Web sites. Businesses can choose from a range of open-source software including operating systems, office suites, Web browsers, and games.  Open-source software allows businesses to reduce the total cost of ownership.  It provides more robust software that’s often more secure than proprietary software.

Define cloud computing, mashups, and widgets and explain how they benefit individuals and businesses

Cloud computing is becoming popular for describing Web-based applications that are stored and accessed via the “cloud” of the Internet.  The software and the data they use are hosted on powerful servers in massive data centers, and can be accessed by anyone with an Internet connection and standard Web browser. The best examples are Google Apps desktop productivity  tools and Microsoft’s Live software suite.

Mashups are new software applications and services based on combining different online software applications using high-speed data networks, universal communication standards, and open-source code. Entrepreneurs are able to create new software applications and services based on combining different online software applications. These new combined applications depend on high-speed data networks, universal communication standards, and open-source code.  The idea is to take different sources and produce a new work that is “greater than” the sum of its parts.  Web mashups combine the capabilities of two or more online applications to create a kind of hybrid that provides more customer value than the original sources alone.

Widgets are small software programs that can be added to Web pages or placed on the desktop to provide additional functionality.  Web widgets run inside a Web page or a blog.  Desktop widgets integrate content from an external source into the user’s desktop to provide services such as a calculator, dictionary, or display current weather conditions.

Businesses benefit most from this new tools and trends by not having to re-invent the wheel.  Widgets have already been developed by someone else and a business can use them for its own purposes.  Mashups let a business combine previously developed Web applications into new ones with new purposes.  They don’t have to re-invent the previous applications from scratch—merely use them in the new processes.  Cloud computing allows a business to use applications previously created and easily available on the Web.  Most of the applications available under the cloud computing label are free and widely used and accepted in business applications.

 

• What are the principal issues in managing hardware and software technology?

Explain why managers need to pay attention to capacity planning and scalability of technology resources.

The principle issues in managing hardware and software assets include capacity planning and scability.  Capacity planning is the process of predicting when a computer hardware system becomes saturated.  It considers factors such as the maximum number of users that the system can accommodate at one time; the impact of existing and future software applications; and performance measures, such as minimum response time for processing business transactions.  Capacity planning ensures that the firm has enough computing power for its current and future needs.

Scability refers to the ability of a computer, product, or system to expand to serve a large number of users without breaking down.  Organizations must ensure they have sufficient computer processing, storage, and network resources to handle surging volumes of digital transactions and to make such data immediately available online.

List and describe the cost components used to calculate the total cost of ownership (TCO) of technology assets.

When calculating the total cost of ownership of technology assets, a business must include the original cost of the hardware and software, installation costs, ongoing administration costs for hardware and software upgrades, maintenance, technical support, training, downtime, and even utility and real estate costs for running and housing the technology. 

“Hidden costs” for support staff, downtime, and additional network management can make distributed client/server architectures—especially those incorporating handheld computers and wireless devices—more expensive than centralized mainframe architectures.

Describe the benefits of outsourcing, on-demand computing, and SaaS for businesses.

In the past, most companies ran their own computer facilities and developed their own software.  Today, more and more companies are obtaining their hardware and software technology from external service vendors.

The most important benefit of outsourcing technology management is that it allows a business to concentrate on its core competencies rather than focusing on technology issues.  Instead of purchasing all the necessary hardware and software for hosting a Web site, a business can use a Web hosting service that maintains a large Web server, or a series of servers, and provides fee-paying subsribers with space to maintain their Web sites. 

Outsourcing custom software development or maintenance to outside firms benefits a company because it won’t have to hire programmers, analysts, and managers with the necessary skills.  An outsourcer often has the technical and management skills to do the job better, faster, and more efficiently. Even though it’s often cheaper to outsource the maintenance of an IT infrastructure and the development of new systems to external vendors, a business must weight the pros and cons carefully.  Service level agreements are formal contracts between customers and service providers that define the specific responsibilities of the service provider and the level of service expected by the customer.

On-demand computing refers to firms off-loading peak demand for computing power to remote, large-scale data processing centers.  It works similar to other utility providers like electricity, water, and waste treatment.  A business can reduce its technology expenditures by investing just enough to handle average processing loads and paying for only as much additional computing power as the market demands.  A company risks  damaging its business from either not having enough computing capacity or from having too much capacity and wasting resources.

Software as a Service (SaaS) refers to services that deliver and provide access to software remotely as a Web-based service.  A business can rent software from another firm and avoid the expense and difficulty of installing, operating, and maintaining the hardware and software on its own. The business must carefully assess the costs and benefits of the service, weighing all people, organizational, and technology issues.  It must ensure it can integrate the software with its existing systems and deliver a level of service and performance that is acceptable for the business.

 

 
Discussion Questions

• Why is selecting computer hardware and software for the organization an important business decision?  What people, organization, and technology issues should be considered when selecting computer hardware and software?

 

As computer hardware and software significantly impact an organization’s performance, the selection of IT assets is critical to the organization’s operations and ultimate success. Issues, include capacity planning and scalability, making decisions regarding the required computer processing and storage capabilities, computer and computer processing arrangements, kinds of software and software tools needed to run the business, determining the criteria necessary to select the right software, the acquisition and management of the organizations hardware and software assets, and what new technologies might be available and beneficial to the firm.

• Should organizations use software service providers for all their software needs?  Why or why not?  What management, organization, and technology factors should be considered when making this decision?

 

The answer to the first question is very dependent upon the organization and its processing, storage, and business needs. When evaluating software service providers, the organization should examine such factors as availability and reliability, technology, fees and how the fees are assessed, and available applications. Managers should compare the costs and capabilities of using software service providers to the organizations costs and capabilities of operating and owning its own hardware and software assets. The organization should examine how using the service will impact organizational culture and how using an outside vendor addresses organizational and business needs. The technology factors include examining how well usage of the service fits with the firms IT infrastructure, as well as examining the appropriateness of using a software service provider to address the current problem.

 

Video Case Questions

You will find a video case illustrating some of the concepts in this chapter on the Laudon Web site at www.prenhall.com/laudon along with questions to help you analyze the case. 

 

Teamwork: Evaluating Server Operation Systems

Form a group with three or four of your classmates.  One group should research and compare the capabilities and costs of Linux versus the most recent version of the Windows operating system for servers.  Another group should research and compare the capabilities and costs of Linux versus UNIX.  Each group should present its findings to the class, using electronic presentation software if possible.

Answers for this project will vary as students will select different sources from which to gather the information.  Information is readily available on the Web to help students complete this project. 

Good sources to explore are:

• http://www.linux.com/
• http://www.microsoft.com/
• http://www.unix.org/

 

As well as the above examples, students can use shopping bots to extract this type of information or they can use print media, computer magazines, the university library, and computer science resource materials. 

 

Business Problem-Solving Case: Amazon’s New Store: Utility Computing

• What technology services does Amazon provide? What are the business advantages to Amazon and to subscribers of these services? What are the disadvantages to each? What kinds of businesses are likely to benefit from these services?

 

Amazon provides on-demand computing, also known as utility computing.  Similar to other utility providers like electric, water, and natural gas, Amazon provides computing capacity to businesses that want to pay only for what they use.

Amazon can generate extra revenue from other businesses by offering its excess capacity to those that need it.  Like most companies, Amazon used only a small portion of it total computing capacity at any one time.  Its infrastructure is considered by many to be among the most robust in the world. Subscribers to the Simple Storage Service (S3) can use only what they need without having to purchase their own hardware and software.  That reduces the total cost of ownership for small and medium-size businesses.  The system is scalable and reliable for both Amazon and subscribers. The Elastic Compute Cloud (EC2) service enables businesses to utilize Amazon’s servers for computing tasks without having the overhead costs.  Risks associated with incorporating the technology are minimal for businesses—Amazon takes most of the risks.

Companies may want to go with more established names in computing; Amazon is not known as a technology company—its reputation is more as a retailer. It’s combating this perception by not requiring service contracts. However, its competitors like IBM, HP, and Sun Microsystems may follow Amazon’s lead and offer utility computing without requiring service-level agreements.  Some companies are wary of using a supplier that doesn’t offer SLAs which guarantee the availability of services in terms of time.  The growth of Amazon Web Services (AWS) could be harmful to its Web services line as well as its retail line if the company doesn’t position itself to handle a dramatic increase in demand on its infrastructure.

Customers may experience outages in the service and not have any recompense since there are no service level agreements—only Amazon’s word that it will maintain 99.9 availability.

Businesses, large and small, can benefit from using AWS.  The service relieves small business from the TCO of having its own systems.  AWS creates the opportunity for others to work at Web scale without making the mistakes that Amazon has already made and learned from.  Large businesses can use AWS as an auxiliary unit without having to increase their hardware and associated TCO.

 

• How do the concepts of capacity planning, scalability, and TCO apply to this case? Apply these concepts both to Amazon and to subscribers of its services.

Amazon must provide hardware capacity planning and scalability for not just its own needs but for all its subscribers.  Overestimates will create a drain on Amazon’s financial assets.  Underestimating capacity and scalability will create shortages for its own business and its subscribers.  Too many instances of non-availability will create the impression that Amazon can’t manage the service.  Estimating scalability for such a large, diverse number of users without breaking down is a huge task.  Amazon must bear the total TCO of its services, all the while ensuring it can profit from it.  The services’ subscribers benefit from not having to worry about these issues and not bearing the brunt of TCO issues.

 

• Search the Internet for companies that supply utility computing.  Select two or three such companies and compare them to Amazon.  What services do these companies provide? What promises do they make about availability? What is their payment model? Who is their target client? If you were launching a Web startup business, would you choose one of these companies over Amazon for Web services? Why or why not? Would your answer change if you were working for a larger company and had to make a recommendation to the CTO?

Sun Microsystems offers utility computing through grid computing.  It charges $1 per cpu hour.  It provides platforms for its target users in computational mathematics, computer aided engineering, electronic design automation, financial services, life sciences computing tasks. Software developers use Sun’s Network.com service for building, testing, and deploying new applications to their customers. It promises 99.9 percent availability. 

Hewlett-Packard (HP) provides utility computing for PCs, server storage, mail and messaging, print, and centralized data center infrastructure through its distributed grid technology.  It targets small, medium and large sized companies for a variety of computing services.  Costs were not available on its web site.  Availability was listed as 99.9 percent.

Amazon seems to be an easier service to incorporate into a start-up business because it has been geared towards small and medium sized businesses since its inception.  It doesn’t bring the same baggage to the table as the larger, more diverse companies do. 

 

• Name three examples each of IT infrastructure hardware components and software components that are relevant to this case.  Describe how these components fit into or are used by Amazon’s Web services and/or the customers that subscribe to these services.

Amazon’s Web services use the following hardware components:

• client/server architecture as the server
•  grid computing
• distributed processing
• storage area networks
• optical disks
• edge computing
• virtualization
• multicore processors

Customers using Amazon’s Web services utilize the following hardware components:

• client/server architecture as the client
• distributed processing
• storage area networks
• optical disks

Amazon’s Web services use the following software components:

• Linux and Unix operating system software
• Java, Ajax, and HTML as the provider
• XML
• Software as a Service (Saas) as the software provider

Customers using Amazon’s Web services utilize the following software components:

• Windows operating system or Mac OS
• Java, Ajax, and HTML as the recipient
• Software as a Service (Saas) as the software user
• Mashups, widgets, cloud computing could be used by customers

 

• Think of an idea for a Web-based startup business.  Explain how this business could utilize Amazon’s S3 and EC2 services.

Students will present a variety of startup business ideas in this question.  They should address the following components:

• Costs associated with S3 data storage

• Estimates of how much data will be stored
• Costs per gigabyte of data

• Access procedures for S3 data storage—they may have to research Amazon’s site to determine what the processes are
• Costs associated with EC2

• Estimate the number of instance-hours the business will consume
• Estimate the inbound and outbound data traffic
• Estimate the AMI costs

• Access procedures for EC2
• Interfaces that may be required between the business and Amazon’s services
• Processes that may be necessary in case of outages

 

Chapter Summary

Section 4.1: IT Infrastructure:  Computer Hardware
Computers are categorized as mainframes, midrange computers, PCs, workstations, or supercomputers.  Mainframes are the largest computers; midrange computers can be minicomputers used in factory, university, or research lab systems, or servers providing software and other resources to computers on a network.  PCs are desktop or laptop machines; workstations are desktop machines with powerful mathematical and graphic capabilities; and supercomputers are sophisticated, powerful computers that can perform massive and complex computations rapidly.  Computing power can be further increased by connecting geographically remote computers into a single network to create a computational grid that combines the computing power of all the computers on the network.

Computers can be networked together to distribute processing among different machines.  In the client/server model of computing, computer processing is split between “clients” and “servers” connected via a network.  The exact division of tasks between client and server depends on the application.  N-tier client/server architecture balances the work of the entire network over several different levels of servers, such as a Web server and an application server.

The principal secondary storage technologies are magnetic disk, optical disk, and magnetic tape.  Optical CD-ROM and DVD disks can store vast amounts of data compactly and some types are rewritable.  Storage area networks (SANs) connect multiple storage devices on a separate high-speed network dedicated to storage.  The principal input devices are keyboards, computer mice, touch screens, magnetic ink and optical character recognition devices, pen-based instruments, digital scanners, sensors, audio input devices, and radio-frequency identification devices.  The principal output devices are cathode ray tube terminals, printers, and audio output devices.

Using batch processing, transactions are accumulated and stored in a group until such time when it is efficient or necessary to process them.  Using online processing, the user enters transactions into a device that is directly connected to the computer system and the transactions are usually processed immediately.

Contemporary hardware trends include the integration of Computing and telecommunications platforms, nanotechnology, edge computing, autonomic computing, virtualization, and multicore processors.

Section 4.2: IT Infrastructure: Computer Software
There are two major types of software: system software and application software.  System software coordinates the various parts of the computer system and mediates between application software and computer hardware.  Application software is used to develop specific business applications. 

The system software that manages and controls the activities of the computer is called the operating system.  The operating system acts as the chief manager of the information system, allocating, assigning, and scheduling system resources, and monitoring the use of the computer.  Other system software includes computer-language translation programs, which convert programming languages into machine language, and utility programs that perform common processing tasks.  PC operating systems have developed sophisticated capabilities, such as multitasking and support for multiple users on networks.  Leading PC operating systems include Windows Vista, Windows XP, Windows Server 2003, Windows CE, UNIX, Linux, and the Macintosh operating system.  Linux is a powerful, resilient open-source operating system that can run on multiple hardware platforms and is used widely to run Web servers.  PC operating systems and many kinds of application software now use graphical user interfaces.

The principal programming languages used in business application software include COBOL, C, C++, and Visual Basic, and each is designed to solve specific types of problems.  Fourth-generation languages are less procedural than conventional programming languages and enable end users to perform many software tasks that previously required technical specialists.  They include popular PC software tools, such as word processing, spreadsheet, data management, presentation graphics, and e-mail software, along with Web browsers and groupware.

Software for the Web includes Java, Ajax, and HTML. Java is a software- and hardware-independent programming language that is the leading interactive programming environment from the Web. Ajax is a combination of Asynchronous JavaScript and XML used for creating interactive Web applications. HTML is a page description language for creating Web pages.

Web services are loosely coupled software components based on XML and open Web standards that are not product specific and can work with any application software and operating system.  They can be used as components of Web-based applications linking the systems of two different organizations or to link disparate systems of a single company.

Software trends include open source software that’s developed by a community of programmers who make their programs available to users, generally free of charge.  Other trends include cloud computing, mashups, and widgets. These three are generally used on Web sites.

Section 4.3: Managing Hardware and Software Technology
Contemporary hardware and software trends demonstrate that, increasingly, computing is taking place over a network.  Computing and telecommunications platforms are becoming integrated. One of the most important issue managers will face in managing hardware and software technology include capacity planning and scalability, determining the total cost of technology assets, determining whether to own and maintain the infrastructure components or lease them from an external service provider, and managing software localization.  

Electronic commerce and electronic business have put new strategic emphasis on technologies that can store vast quantities of transaction data and make them immediately available online.  Managers and information systems specialists need to pay special attention to hardware capacity planning and scalability to ensure that the firm has enough computing power for its current and future needs.

Businesses also need to balance the costs and benefits of building and maintaining their own hardware and software versus outsourcing these assets to external service providers.  Companies may outsource custom software application development to an external vendor (that may be off-shore) or rent software services from an application service provider (ASP) under the Software as a Service (SaaS) umbrella.  ASPs rent out software applications and computer services from remote computer centers to subscribers over the Internet or private networks.  In an on-demand (utility) computing model, companies pay technology service providers only for the amount of computing power and services that they actually use.

Calculating the total cost of ownership (TCO) of the organization’s technology assets can help provide managers with the information they need to manage these assets and decide whether to rent or own these assets.  The total cost of owning technology resources includes not only the original cost of computer hardware and software but also costs for hardware and software upgrades, maintenance, technical support, and training.

In a global business, managers may be required to create systems that can be realistically used by multiple business units in different countries.  Management issues include planning for different languages, cultures, customs, laws, and business processes in a global information system.  All of these factors add to the total cost of ownership and will influence decisions managers make.