MBA – 207 PYQS

1. Attempt in details a) What are the characteristics of information systems? Explain in the light of
business? b) Discuss the contemporary approach to information systems? c) What are the
models of strategy according to Porter? Write in the light of information systems? d) Discuss the
functions of supply chain management software? e) What are the moral dimensions of
Information systems?

ANS. (a) Characteristics of Information Systems in the Context of Business

An Information System (IS) is a combination of technology, people, and processes that collect,
process, store, and distribute information to support decision-making and business operations. In
a business environment, IS plays a crucial role in improving efficiency, reducing costs, and
enabling strategic advantages.

Characteristics of Information Systems

1. Data Collection & Processing – IS gathers raw data from various sources and converts it
into meaningful information.
2. Automation of Processes – Reduces manual effort by automating routine tasks such as
payroll, accounting, and inventory management.
3. Decision Support – Helps management make data-driven decisions by providing real-
time insights and predictive analytics.
4. Interconnectivity – Enables seamless communication and collaboration within and
outside an organization (e.g., supply chain integration).
5. Scalability – IS can be expanded as business needs grow, supporting new users,
processes, and markets.
6. Security & Control – Implements measures to protect data from cyber threats,
unauthorized access, and system failures.
7. Integration of Business Functions – Connects departments such as HR, finance, and
sales, improving coordination and efficiency.
8. Competitive Advantage – Helps businesses gain an edge by leveraging data analytics,
customer insights, and market trends.

In business, information systems are used for various applications such as Enterprise Resource
Planning (ERP), Customer Relationship Management (CRM), and Business Intelligence (BI).
For example, companies like Amazon use IS for order processing, logistics tracking, and
personalized customer recommendations.

(b) Contemporary Approaches to Information Systems

The contemporary approach to Information Systems integrates various disciplines and
methodologies to enhance business efficiency and decision-making. The following are the key
approaches:

1. Technical Approach
o Focuses on the hardware, software, databases, and networks that make up IS.
o Includes concepts from computer science, artificial intelligence, and cloud
computing.
o Example: Use of AI-driven chatbots in customer support.
2. Behavioral Approach
o Examines how humans interact with information systems.
o Includes fields like psychology, sociology, and management studies.
o Example: The study of employee resistance to new IT systems.
3. Sociotechnical Approach
o Combines technical and behavioral perspectives to optimize IS implementation.
o Suggests that successful IS should balance technology with human and
organizational needs.
o Example: Implementing ERP software by considering both technical feasibility
and employee training.
4. Digital Transformation Approach
o Focuses on how IS enables business transformation and innovation.
o Includes cloud computing, big data, and blockchain applications in business.
o Example: E-commerce platforms like Flipkart using AI for personalized
recommendations.

Modern businesses use these approaches to improve decision-making, streamline operations, and
create new business models.

(c) Porter’s Models of Strategy in the Context of Information Systems

Michael Porter developed strategic models that help businesses gain a competitive advantage.
Information Systems play a crucial role in implementing these strategies.

1. Porter’s Five Forces Model – Analyzes the competitive forces in an industry to

determine profitability.
o Threat of New Entrants: Information systems like CRM and automation help
companies build brand loyalty and reduce operational costs, creating entry
barriers.
o Bargaining Power of Suppliers: Supply chain management systems improve
supplier relationships and reduce dependency.
o Bargaining Power of Buyers: IS enhances customer service through
personalized marketing and AI-driven insights.
o Threat of Substitutes: Digital innovations, such as mobile apps, help businesses
differentiate their products.
 o Industry Rivalry: Companies use IS to track competitor performance and market
trends in real time.
2. Porter’s Generic Strategies – Three main ways businesses can achieve competitive
advantage using IS:
o Cost Leadership: Automating business processes using IS to reduce costs (e.g.,
Walmart’s supply chain system).
o Differentiation: Leveraging data analytics and AI for product customization
(e.g., Netflix’s recommendation algorithm).
o Focus Strategy: Using IS to target niche markets effectively (e.g., high-end
fashion retailers using AI-driven customer insights).
3. Porter’s Value Chain Model – Analyzes how IS can enhance various business
functions:
o Primary Activities: Operations, marketing, sales, logistics, and customer service.
o Support Activities: HR, IT, procurement, and infrastructure.
o Example: Amazon uses AI-driven logistics and automation in warehouses to
enhance the value chain.

(d) Functions of Supply Chain Management (SCM) Software

SCM software helps businesses manage the flow of goods, services, and information across the
supply chain. Its key functions include:

1. Procurement Management – Automates purchasing processes, tracks supplier

performance, and reduces procurement costs.
2. Inventory Management – Monitors stock levels in real time to prevent overstocking or
stockouts.
3. Logistics & Transportation Management – Optimizes route planning, shipment
tracking, and delivery scheduling.
4. Order Processing – Streamlines order fulfillment, invoicing, and payment processing.
5. Supplier Relationship Management (SRM) – Enhances collaboration with suppliers to
improve product quality and reduce costs.
6. Demand Forecasting – Uses data analytics and AI to predict market demand and
optimize production schedules.
7. Warehouse Management – Manages storage, picking, packing, and shipping processes
efficiently.
8. Risk Management – Identifies potential disruptions in the supply chain and suggests
contingency plans.

Companies like Amazon and Walmart use SCM software to improve efficiency, reduce costs,
and enhance customer satisfaction.

(e) Moral Dimensions of Information Systems

The use of IS raises several ethical and moral concerns that impact individuals, businesses, and
society. Some key dimensions include:

1. Privacy
o The collection and use of personal data without consent (e.g., social media
tracking users’ online behavior).
o Example: Facebook’s Cambridge Analytica scandal involving data misuse.
2. Security
o Protecting sensitive business and customer data from cyber threats.
o Example: Ransomware attacks on hospitals disrupting patient care.
3. Accuracy & Integrity
o Ensuring data used in decision-making is accurate and reliable.
o Example: AI-based credit scoring systems discriminating against certain
applicants due to biased data.
4. Intellectual Property Rights
o Issues related to software piracy, content plagiarism, and unauthorized use of
digital assets.
o Example: Companies using copyrighted content without permission.
5. Access & Digital Divide
o Unequal access to technology between developed and developing regions.
o Example: Lack of internet access in rural areas limiting education and job
opportunities.
6. Accountability & Liability
o Who is responsible when IS causes harm due to errors or misuse?
o Example: Self-driving car accidents and legal responsibility concerns.

To address these concerns, businesses implement ethical guidelines, cybersecurity measures,

and compliance policies to ensure responsible use of IS.

Q. 2 How do Information Systems impact organizations and functions? Explain with the help of
suitable cases/illustrations. OR What are the various types of decision support systems? Explain
each with suitable examples/illustrations?

Answer 1: Impact of Information Systems on Organizations and Functions

Information Systems (IS) play a crucial role in modern organizations by improving efficiency,
decision-making, and competitive advantage. These systems help businesses collect, process,
store, and distribute information, enabling better coordination and strategic planning. Below are
some key impacts of Information Systems on organizations, along with relevant examples:

1. Improved Decision-Making
  Impact: IS provides real-time data, analytics, and forecasting tools that enable better
decision-making at all levels of an organization.
 Example: A retail company like Walmart uses data analytics systems to track customer
preferences and optimize inventory levels, ensuring products are available when needed.

2. Enhanced Communication and Collaboration

 Impact: IS facilitates seamless communication within and between organizations using

email, video conferencing, and collaborative platforms.
 Example: Companies like Google use cloud-based tools such as Google Workspace
(Docs, Sheets, Meet) to allow employees to collaborate in real-time across different
locations.

3. Increased Efficiency and Productivity

 Impact: Automated processes and digital workflows reduce manual tasks, minimizing
errors and improving efficiency.
 Example: Amazon’s use of warehouse management systems and robotic automation
speeds up order processing, reducing human effort and operational costs.

4. Competitive Advantage

 Impact: Organizations leveraging advanced IS gain an edge over competitors through

superior customer service, personalization, and efficient supply chain management.
 Example: Netflix uses Artificial Intelligence (AI)-based recommendation systems to
personalize content suggestions for users, increasing customer retention and engagement.

5. Better Customer Service and Experience

 Impact: Customer Relationship Management (CRM) systems help organizations

understand customer needs, improving service quality.
 Example: Companies like Salesforce provide CRM solutions that enable businesses to
track customer interactions, resolve issues faster, and enhance user satisfaction.

6. Cost Reduction

 Impact: Cloud computing and enterprise resource planning (ERP) systems reduce
operational costs by optimizing resource allocation.
 Example: A manufacturing firm using SAP ERP software can streamline its supply
chain, reducing material waste and inventory costs.

7. Compliance and Risk Management

 Impact: IS helps businesses adhere to legal regulations, security policies, and risk
management strategies.
  Example: Banks use fraud detection systems powered by machine learning to monitor
transactions and prevent financial fraud.

Case Study: Impact of IS in Banking

Banks rely heavily on IS for secure transactions, fraud detection, and customer service. The
introduction of Core Banking Systems (CBS) has allowed banks to offer seamless online
banking experiences.

 Example: SBI’s YONO app provides digital banking services, enabling customers to
access financial services 24/7 from anywhere.

Answer 2: Types of Decision Support Systems (DSS)

A Decision Support System (DSS) is an interactive software-based system designed to assist

decision-makers in gathering and analyzing data, solving problems, and making decisions. DSS
can be categorized into several types based on their functions and the kind of decision-making
they support.

1. Model-Driven DSS

 Definition: Uses mathematical and statistical models to support decision-making.

 Example: Financial forecasting systems used by investment firms to predict stock prices.
 Illustration: A company like JPMorgan Chase uses financial modeling tools to analyze
market trends and suggest optimal investment strategies.

2. Data-Driven DSS

 Definition: Focuses on analyzing large volumes of data to identify patterns and trends.
 Example: Business Intelligence (BI) tools such as Tableau and Power BI help businesses
visualize sales performance.
 Illustration: A retail company like Walmart uses BI dashboards to monitor sales,
customer preferences, and inventory levels in real time.

3. Knowledge-Driven DSS

 Definition: Uses expert knowledge and Artificial Intelligence (AI) to provide

recommendations.
 Example: IBM Watson assists doctors in diagnosing diseases based on medical records
and research.
 Illustration: In healthcare, AI-driven DSS helps doctors recommend treatments for
cancer patients by analyzing past cases and medical literature.

4. Communication-Driven DSS
  Definition: Facilitates group decision-making by enabling collaboration and
communication.
 Example: Microsoft Teams and Slack help organizations conduct virtual meetings and
share information.
 Illustration: A multinational company like Deloitte uses Microsoft Teams for remote
collaboration, decision-making, and knowledge sharing among employees worldwide.

5. Document-Driven DSS

 Definition: Helps organizations manage and retrieve structured and unstructured

documents.
 Example: Google Drive and SharePoint enable organizations to store and access reports
and policies.
 Illustration: A law firm uses a document-driven DSS to retrieve case files and legal
precedents while preparing for litigation.

3. (15 Marks)

Discuss Simon’s model on decision making and various types of decision-making

processes?

OR

Write a detailed note on the CRM software dimension of knowledge and the Knowledge
Management Value Chain?

ANS. 1. Simon’s Model on Decision Making and Various Types of

Decision-Making Processes
Herbert Simon’s Model of Decision Making

Herbert A. Simon, a Nobel laureate, introduced a three-phase decision-making model based on

the concept of bounded rationality. He argued that decision-makers do not have unlimited
cognitive ability or access to all information, leading them to make satisficing decisions
(choosing an option that is good enough rather than optimal).

Simon’s Three-Stage Model of Decision Making

1. Intelligence Phase
o Identifies problems or opportunities by collecting and analyzing relevant information.
o Recognizes conditions that need decision-making.
o Example: A retail company notices a decline in customer purchases through sales
reports.

2. Design Phase
 o Develops possible solutions or alternatives.
o Evaluates the pros and cons of each alternative.
o Example: The company considers reducing product prices, launching a promotional
campaign, or improving product quality.

3. Choice Phase
o Selects the best alternative based on available data and constraints.
o The chosen solution is implemented, and its effectiveness is monitored.
o Example: The company decides to introduce a loyalty program to encourage repeat
purchases.

Types of Decision-Making Processes

Decision-making processes vary based on the complexity of the problem, the level of
uncertainty, and the structure involved.

1. Programmed and Non-Programmed Decisions

 Programmed Decisions: Routine, structured decisions made using predefined rules.

o Example: Approving leave requests in an HR department.
 Non-Programmed Decisions: Unique, complex decisions that require creative problem-solving.
o Example: Deciding to expand a company into a new international market.

2. Strategic, Tactical, and Operational Decisions

 Strategic Decisions: Long-term, high-impact decisions affecting overall organizational direction.

o Example: A company deciding to acquire a competitor.
 Tactical Decisions: Mid-term decisions that help in implementing strategies.
o Example: Setting an annual marketing budget.
 Operational Decisions: Short-term, routine decisions focused on efficiency.
o Example: Assigning daily tasks to employees.

3. Rational and Bounded Rationality Decision Making

 Rational Decision-Making: Assumes complete information and logical evaluation of all

alternatives to maximize benefits.
o Example: A financial analyst evaluating multiple investment opportunities using
mathematical models.
 Bounded Rationality: Decision-makers operate under constraints of time, information, and
cognitive limits.
o Example: A manager choosing a supplier based on past experience rather than
conducting a full market analysis.

4. Individual vs. Group Decision Making

  Individual Decision Making: A single person makes decisions, usually faster but may lack diverse
perspectives.
o Example: A CEO deciding to cut costs.
 Group Decision Making: Multiple stakeholders participate, leading to better-informed but
slower decisions.
o Example: A project team deciding on a new product design.

5. Intuitive vs. Data-Driven Decision Making

 Intuitive Decision Making: Based on experience, gut feeling, or instincts.

o Example: A startup founder choosing a business partner based on personal trust.
 Data-Driven Decision Making: Relies on analysis, reports, and quantitative data.
o Example: A retailer using AI to decide on inventory levels.

2. CRM Software Dimension of Knowledge and the Knowledge

Management Value Chain
CRM Software Dimension of Knowledge

Customer Relationship Management (CRM) software helps businesses manage customer

interactions and data efficiently. The knowledge dimension of CRM software focuses on using
customer information to improve decision-making and enhance customer satisfaction.

Types of Knowledge in CRM

1. Explicit Knowledge: Structured data, such as customer profiles, purchase history, and
service records.
o Example: A CRM database storing customer contact details and previous interactions.

2. Tacit Knowledge: Unstructured insights, personal experiences, and informal knowledge

held by employees.
o Example: A sales representative knowing that a particular customer prefers weekend
calls.

3. Embedded Knowledge: Built-in knowledge within CRM systems, such as AI-based

recommendations.
o Example: A CRM suggesting upselling opportunities based on past customer purchases.

Functions of Knowledge in CRM Software

 Customer Data Management: Stores and organizes customer records.

 Predictive Analytics: Uses AI to forecast customer behavior.
 Personalization: Helps in targeted marketing and customized recommendations.
  Automation: Streamlines communication through chatbots and email automation.
 Decision Support: Assists managers with insights for sales forecasting and customer retention
strategies.

Knowledge Management Value Chain

The Knowledge Management Value Chain (KMVC) represents the stages through which
knowledge is captured, processed, and utilized for strategic advantage. It involves six key steps:

1. Knowledge Acquisition

 Collecting data from various sources, including internal databases, social media, and customer
interactions.
 Example: A CRM system tracking customer preferences based on their website visits.

2. Knowledge Storage

 Organizing and storing information in databases or cloud systems for easy retrieval.
 Example: A company storing customer feedback in a CRM for future reference.

3. Knowledge Dissemination

 Sharing knowledge across departments to improve decision-making and customer service.

 Example: A centralized CRM system where both sales and customer support teams can access
client history.

4. Knowledge Application

 Using stored knowledge to improve processes, decision-making, and customer engagement.

 Example: A support team accessing a CRM to personalize responses to customer queries.

5. Knowledge Refinement

 Continuously updating and improving knowledge based on new insights and feedback.
 Example: A retail company refining customer segmentation models based on recent purchasing
trends.

6. Knowledge Creation and Innovation

 Generating new insights and using them for competitive advantage.

 Example: A company analyzing customer trends to launch a new product line.
 Q.4 Explain the following: (i) What is Data Mining? Explain its techniques and applications. (ii)
What is SDLC (Software Development Life Cycle)? Describe its phases. (iii) What is Security and
Control of Management Information Systems? Explain its importance.

(i) What is Data Mining? Explain its Techniques and Applications.

Definition:
Data mining is the process of discovering patterns, correlations, trends, and useful information
from large datasets using statistical, machine learning, and artificial intelligence techniques. It
helps businesses and researchers make data-driven decisions by extracting hidden insights.

Techniques of Data Mining:

1. Classification – Categorizing data into predefined groups (e.g., spam vs. non-spam
emails).
2. Clustering – Grouping similar data objects without predefined categories (e.g., customer
segmentation in marketing).
3. Association Rule Mining – Identifying relationships between variables in large datasets
(e.g., market basket analysis in retail).
4. Regression – Predicting numerical values based on existing data (e.g., sales forecasting).
5. Anomaly Detection – Identifying unusual patterns or outliers (e.g., fraud detection in
banking).
6. Sequential Pattern Mining – Finding patterns in sequential data (e.g., analyzing
customer purchase behavior over time).

Applications of Data Mining:

 Business Analytics: Helps companies analyze consumer behavior and improve

marketing strategies.
 Healthcare: Predicting diseases and recommending treatments based on patient data.
 Finance & Banking: Fraud detection, risk analysis, and credit scoring.
 E-commerce & Retail: Personalized recommendations and inventory management.
 Education: Student performance analysis and personalized learning.

(ii) What is SDLC (Software Development Life Cycle)? Describe its Phases.

Definition:
Software Development Life Cycle (SDLC) is a structured approach to software development,
outlining different stages from planning to deployment and maintenance. It ensures high-quality
software development in a systematic manner.

Phases of SDLC:
 1. Planning – Understanding project objectives, feasibility analysis, and resource
allocation.
2. Requirement Analysis – Gathering user requirements, defining functionalities, and
documenting specifications.
3. Design – Creating architectural and system design, including UI/UX design and database
design.
4. Implementation (Coding) – Writing and developing the actual code based on design
specifications.
5. Testing – Identifying and fixing defects through various testing methods (unit testing,
integration testing, etc.).
6. Deployment – Releasing the software for use, either through direct installation or cloud-
based solutions.
7. Maintenance – Ongoing updates, bug fixes, and improvements to enhance software
performance.

Common SDLC Models:

 Waterfall Model – Linear and sequential approach.

 Agile Model – Iterative and flexible development approach.
 V-Model (Validation & Verification) – Testing is performed parallel to development
phases.
 Spiral Model – Risk-based iterative approach combining Waterfall and Agile.

(iii) What is Security and Control of Management Information Systems? Explain its
Importance.

Definition:
Security and control of Management Information Systems (MIS) refer to the policies,
procedures, and technologies used to protect information systems from threats, unauthorized
access, and cyber-attacks. It ensures data integrity, confidentiality, and availability.

Components of MIS Security & Control:

1. Access Control – Restricting user access based on roles and permissions.

2. Data Encryption – Securing sensitive information through encryption techniques.
3. Firewall & Network Security – Protecting systems from external threats and cyber-
attacks.
4. Backup & Disaster Recovery – Ensuring data is backed up and recoverable in case of
failures.
5. Authentication & Authorization – Using passwords, biometrics, and multi-factor
authentication to verify users.
6. Auditing & Monitoring – Keeping track of system activities to detect and prevent
security breaches.
Importance of MIS Security & Control:

 Protects Sensitive Data: Prevents unauthorized access and data breaches.

 Ensures Business Continuity: Avoids financial losses due to cyber threats.
 Legal & Regulatory Compliance: Helps organizations comply with data protection laws
(e.g., GDPR, HIPAA).
 Enhances Trust & Reliability: Improves customer confidence in the security of
business operations.
 Reduces Cybersecurity Risks: Prevents malware, phishing, and ransomware attacks.

By implementing strong security controls, organizations can safeguard their information systems
and ensure smooth business operations.

4. How does Information System contribute to the planning and development of business
strategy? Explain with suitable case studies?

Ans. How Information Systems Contribute to Business Strategy Planning and

Development

Information Systems (IS) play a crucial role in business strategy by providing data-driven
insights, improving operational efficiency, enabling competitive advantage, and fostering
innovation. Businesses leverage IS for strategic decision-making, risk assessment, market
analysis, and customer relationship management.

Key Contributions of Information Systems to Business Strategy

1. Data-Driven Decision Making

o IS helps organizations analyze vast amounts of data to make informed strategic
decisions.
o Example: Amazon utilizes Big Data analytics to personalize recommendations,
optimize inventory, and enhance supply chain efficiency.
2. Competitive Advantage
o Businesses use IS to differentiate themselves from competitors through
automation, cost reduction, and superior customer service.
o Example: Walmart employs an advanced IS for real-time inventory tracking and
demand forecasting, enabling efficient supply chain management.
3. Operational Efficiency and Cost Reduction
o Automation and integration of business processes reduce operational costs and
improve productivity.
o Example: Toyota uses IS-driven Just-in-Time (JIT) manufacturing to minimize
waste and optimize production schedules.
4. Market Analysis and Forecasting
o IS helps businesses assess market trends, consumer behavior, and economic
conditions to align their strategy accordingly.
o Example: Netflix utilizes predictive analytics to determine viewer preferences and
create data-driven content strategies.
 5. Customer Relationship Management (CRM)
o Businesses use IS to enhance customer engagement, retention, and service
quality.
o Example: Salesforce provides CRM solutions that help companies manage
customer interactions and sales pipelines effectively.
6. Risk Management and Security
o IS aids in detecting fraud, ensuring compliance, and securing sensitive business
data.
o Example: Banking Sector (e.g., JP Morgan) uses AI-based fraud detection
systems to prevent cyber threats and financial fraud.

Case Studies on IS in Business Strategy

1. Amazon: Leveraging IS for E-commerce Domination

 Amazon’s use of Big Data and AI allows personalized recommendations, dynamic

pricing, and supply chain optimization.
 The AWS cloud computing division provides businesses with scalable IT infrastructure,
contributing to Amazon’s market dominance.
 Outcome: Amazon became the global leader in e-commerce and cloud computing.

2. McDonald's: Digital Transformation for Competitive Edge

 Implemented AI-driven kiosks for faster ordering and reduced wait times.
 Uses predictive analytics to manage inventory and reduce food wastage.
 Outcome: Increased customer satisfaction and operational efficiency, leading to higher
revenue.

3. Zara: Fast Fashion with IS-Driven Supply Chain

 Uses real-time sales tracking and AI-driven demand forecasting.

 Implements RFID technology to optimize inventory management.
 Outcome: Faster response to fashion trends, reduced stock wastage, and a competitive
edge in the retail market.

5.

(i) Write a detailed note on Database Management Systems (DBMS) and Security Information
Systems with suitable case studies or illustrations.

OR

(ii) Write a detailed note on the Social and Political Issues raised by Information Systems.
5(i) Database Management Systems (DBMS) and Security Information Systems

Database Management Systems (DBMS)

A Database Management System (DBMS) is software that facilitates the creation,

management, and retrieval of data in a structured manner. It ensures data integrity, security, and
efficiency in handling large volumes of information.

Key Features of DBMS

1. Data Organization – Stores data in structured formats such as tables.

2. Data Integrity – Enforces constraints like primary keys and foreign keys.
3. Data Security – Implements user authentication and role-based access.
4. Data Consistency – Ensures data accuracy across different transactions.
5. Concurrency Control – Manages simultaneous access to the database.
6. Backup and Recovery – Prevents data loss through periodic backups.

Types of DBMS

1. Relational DBMS (RDBMS) – Uses tables (e.g., MySQL, Oracle, SQL Server).
2. Hierarchical DBMS – Stores data in a tree-like structure (e.g., IBM Information Management
System).
3. Network DBMS – Uses graph structures (e.g., Integrated Data Store).
4. NoSQL DBMS – Handles unstructured data (e.g., MongoDB, Cassandra).

Case Study: Banking System

Problem: A bank requires secure and efficient handling of customer accounts, transactions, and
loan data.
Solution: Implementing an RDBMS like Oracle allows structured storage of customer details,
secure transactions, and multi-user access. It ensures real-time updates and compliance with
financial regulations.

Security Information Systems (SIS)

Security Information Systems (SIS) refer to technologies and strategies used to protect
information assets from cyber threats, unauthorized access, and data breaches.

Components of SIS

1. Access Control – Authentication (passwords, biometrics) and authorization (role-based access).

2. Encryption – Secures data using cryptographic techniques.
3. Firewalls and Intrusion Detection Systems (IDS) – Prevent cyberattacks.
4. Incident Response and Recovery – Plans for handling security breaches.
 5. Compliance Management – Ensures adherence to regulations (e.g., GDPR, HIPAA).

Case Study: E-commerce Security

Problem: Online retailers face threats like data theft, credit card fraud, and hacking.
Solution: Amazon employs multi-layer security with SSL encryption, two-factor
authentication, and fraud detection algorithms to secure user data and transactions.

6(ii) Social and Political Issues Raised by Information Systems

Social Issues

1. Privacy Concerns – Data collection by companies (e.g., Google, Facebook) raises concerns about
user privacy.
2. Surveillance – Governments and corporations use technology to monitor individuals, raising
ethical issues.
3. Digital Divide – Unequal access to technology creates educational and economic disparities.
4. Job Displacement – Automation and AI replace human workers in industries like manufacturing
and customer service.
5. Misinformation and Fake News – Social media enables rapid spread of misinformation,
influencing public opinion and elections.

Political Issues

1. Censorship and Free Speech – Governments regulate or block access to certain information
(e.g., China’s Great Firewall).
2. Cyber Warfare and Espionage – Nations engage in cyberattacks to steal data or disrupt critical
infrastructure.
3. Election Manipulation – Social media and data analytics influence political campaigns and voter
behavior (e.g., Cambridge Analytica scandal).
4. Regulatory Challenges – Policymakers struggle to create laws for emerging technologies like AI
and cryptocurrency.

Case Study: Facebook-Cambridge Analytica Scandal

Issue: In 2018, Cambridge Analytica misused Facebook data to influence political campaigns,
raising ethical concerns about data privacy and electoral manipulation.
Impact: Governments enforced stricter data protection laws like the EU’s General Data
Protection Regulation (GDPR).