Defining Information Systems and Their Impact on Competitive Edge

Information is a powerful tool that helps people to make decisions. With information, you can make informed choices and therefore alter your behavior. The challenge is then to transform that information into knowledge. Information also has an emotional component – it can make you feel good or bad. Emotion plays a huge role in how we use information and therefore in our society.

In a broader sense, information is organised, processed and categorised data. It gives context to already existing data and allows decision making about new data. For instance, a single consumer’s sale at a particular restaurant is statistical data this becomes valuable information when the company is able to identify which food is the best or least popular. However, with no knowledge of the restaurant’s menu or even if they have any, there is no way these people will know which food to order.

Therefore, for information systems to provide true competitive advantage, they must be robust enough to cope with changes in behaviour without being affected by them. As part of their work, companies must also build internal information technology infrastructure. This infrastructure consists of: large scale data integration and analysis tools; information systems; knowledge resources such as process reengineering and business intelligence software; internet and email technologies; business process models and other back-end services; and customer relationship management (CRM) systems. Having all this information together, even if it is spread across different departments, makes it easier for a company to make informed decisions and achieve its goals.