Information systems are computer-based tools that help people transform data into information.
As you know, many of the problems and opportunities faced by government agencies, businesses, and other organizations are so complex, and involve so many locations, that the organizations need assistance in creating useful and timely information. That's what information systems are for.
Allow me a fanciful example. Suppose that you've launched a new business that manufactures solar-powered lawn mowers. You're planning a direct mail campaign to bring this revolutionary new product to the attention of prospective buyers. But, since it's a small business, you can't afford to sponsor coast-to-coast television commercials or to send brochures by mail to more than 100 million U.S. households. Instead, you plan to target the most likely customers - those who are environmentally conscious, have higher than average family incomes, and who live in areas where there is enough water and sunshine to support lawns and solar power.
Fortunately, lots of data are available to help you define your mailing list. Household incomes are routinely reported to banks and other financial institutions when families apply for mortgages, loans, and credit cards. Personal tastes related to issues like the environment are reflected in behaviors such as magazine subscriptions and credit card purchases. Firms like Claritas amass such data, and transform it into information by creating "lifestyle segments" - categories of households that have similar incomes and tastes. Your solar lawnmower company can purchase lifestyle segment information by 5-digit ZIP code, or even by ZIP+4 codes, which designate individual households.
It's astonishing how companies like Claritas can create valuable information from the millions upon millions of transactions that are recorded every day. Their products are made possible by the fact that the original data exist in digital form, and because the companies have developed information systems that enable them to transform the data into information that companies like yours value. The fact that lifestyle information products are often delivered by geographic areas, such as ZIP codes, speaks to the appeal of geographic information systems.
Try out the demo of what Claritas used to call the "You Are Where You Live" tool. The Nielson Company has acquired Claritas and the tool is now called "MyBestSegments." Point your browser to the My Best Segments page. Click the button under "ZIP Code Look-up."
Enter your ZIP code then choose a segmentation system. Do the lifestyle segments, listed on the left, seem accurate for your community? If you don't live in the United States, try Penn State's Zip code, 16802.
Does the market segmentation match your expectations? Registered students are welcome to post comments to the Discussion Forum in the Chapter 1 module in Canvas.