86  Information Technology in Management

86.1 Concept

Information Technology (IT) = the application of computers, software, networks and data systems to manage information for business decisions. Peter Drucker (1995): “We must shift from IT to IS — Information that creates value.” Nicholas Carr (HBR 2003): “IT Doesn’t Matter” — IT becoming a commodity. Erik Brynjolfsson & Andrew McAfee wrote the most cited books on digital transformation.

86.2 Types of Information Systems

TipPyramid of IS
Level System Users
Strategic EIS / ESS · BI / Analytics Top management
Tactical / Managerial DSS · MIS · Expert Systems Middle management
Operational TPS · Office Automation · KMS Operating staff
TipKey system types
  • TPS (Transaction Processing System) — records routine transactions.
  • MIS (Management Information System) — periodic reports.
  • DSS (Decision Support System) — ad-hoc analysis.
  • EIS / ESS (Executive Support System) — dashboards.
  • ERP — integrated enterprise.
  • CRM, SCM.
  • KMS (Knowledge Management System).
  • Expert Systems — rule-based AI.
  • GIS — geographic.
  • OAS (Office Automation Systems) — email, calendar.
  • Group Support Systems (GSS) / Collaboration tools.

86.3 Business Value Frameworks

TipIT value frameworks
  • Porter’s Value Chain — IT supports each activity.
  • Michael Porter & Victor Millar (1985) — IT changes competition: industry structure, competitive advantage, new businesses.
  • Carr (2003) — “IT Doesn’t Matter” — becomes commodity.
  • Brynjolfsson — Productivity Paradox — IT investment vs productivity disconnect.
  • Digital Transformation — Westerman et al.
  • Innovator’s Dilemma — Christensen.
  • Wernerfelt & Barney RBV — IT as resource.

86.4 Strategic Use of IT

TipStrategic IT applications
  • Cost leadership — automation, scale.
  • Differentiation — superior service, customer experience.
  • Focus / Niche — analytics-driven targeting.
  • Innovation — new business models (Uber, Airbnb).
  • Customer lock-in — switching costs.
  • Process innovation / BPR.
  • Network effects — Metcalfe’s Law.
  • Platforms — Two-sided markets (Rochet-Tirole).

86.5 E-Business and E-Commerce

TipE-business models
  • B2C — Amazon, Flipkart, Myntra.
  • B2B — IndiaMart, Alibaba.
  • C2C — OLX, eBay.
  • C2B — Influencer to brands.
  • B2G / G2B — GeM portal India.
  • G2C — Aadhaar, MyGov.
  • D2C — Mamaearth, boAt direct-to-consumer.
  • Marketplaces vs Inventory models.

86.6 Indian Digital Public Infrastructure (DPI)

TipIndia Stack — DPI
  • Aadhaar (UIDAI, 2009) — biometric ID.
  • UPI (NPCI, 2016) — Unified Payments Interface.
  • DigiLocker.
  • e-KYC, e-Sign, e-Stamp.
  • GSTN — Goods & Services Tax network.
  • CoWIN (pandemic).
  • ONDC — Open Network for Digital Commerce.
  • Account Aggregator framework.
  • DEPA — Data Empowerment & Protection Architecture.
  • API Setu.
  • e-RUPI — digital voucher.
  • PM Gati Shakti.

86.7 Software Categories

TipSoftware types
  • System software — OS, drivers.
  • Application software — ERP, CRM, productivity.
  • Middleware — integration.
  • Embedded software — devices.
  • Open source — Linux, Apache, MySQL, Hadoop.
  • SaaS / PaaS / IaaS — cloud delivery.

86.8 IT Governance

TipIT governance frameworks
  • COBIT — ISACA.
  • ITIL — Service management.
  • ISO 27001 — Information Security.
  • ISO 20000 — IT service management.
  • COSO — Internal controls.
  • TOGAF — Enterprise architecture.
  • NIST Cybersecurity Framework.
  • Indian IT Act 2000, amended 2008.
  • DPDP Act 2023 — Digital Personal Data Protection.
  • RBI guidelines for banks.
  • CERT-In — India’s cyber incident response.

86.9 Cloud Computing

TipCloud computing (NIST)
  • Service models: IaaS · PaaS · SaaS · FaaS (serverless).
  • Deployment: Public · Private · Hybrid · Community · Multi-cloud.
  • 5 essential characteristics (NIST): on-demand · broad network · resource pooling · rapid elasticity · measured service.
  • Top providers: AWS, Microsoft Azure, Google Cloud Platform, Oracle Cloud, IBM Cloud.
  • Indian players: Tata Communications, Yotta, NxtGen.

86.10 Cybersecurity

TipCybersecurity dimensions
  • CIA triad: Confidentiality · Integrity · Availability.
  • AAA: Authentication · Authorisation · Accounting.
  • Threats: malware · ransomware · phishing · DDoS · insider · APT · zero-day.
  • Defences: firewall · IDS/IPS · SIEM · MFA · encryption · backups · zero trust.
  • Standards: ISO 27001 · NIST · PCI-DSS · HIPAA · DPDP Act 2023.
  • Indian: CERT-In, NCIIPC, NCSC, RBI cyber framework.
  • Notable: WannaCry 2017, Cosmos Bank Pune 2018, AIIMS Delhi 2022.

86.12 Practice Questions

Q 01TPSEasy

TPS records:

  • ARoutine transactions
  • BStrategic plans
  • CKnowledge
  • DExecutive dashboards
View solution
Correct Option: A
Transaction Processing System — operational.
Q 02UPIMedium

UPI was launched in:

  • A2016
  • B2010
  • C2020
  • D2014
View solution
Correct Option: A
NPCI launched UPI in April 2016.
Q 03CloudMedium

SaaS, PaaS, IaaS are:

  • ACloud service models
  • BCloud deployment models
  • CNetwork protocols
  • DSecurity frameworks
View solution
Correct Option: A
Service-model layers.
Q 04CIA TriadMedium

CIA triad does NOT include:

  • AConfidentiality
  • BIntegrity
  • CAuthentication
  • DAvailability
View solution
Correct Option: C
CIA = Confidentiality + Integrity + Availability.
Q 05CarrHard

"IT Doesn't Matter" (2003) was by:

  • ANicholas Carr
  • BBrynjolfsson
  • CDrucker
  • DPorter
View solution
Correct Option: A
HBR May 2003.
Q 06DPDPMedium

India's DPDP Act came in:

  • A2023
  • B2019
  • C2021
  • D2024
View solution
Correct Option: A
Digital Personal Data Protection Act 2023.
Q 07DSSMedium

DSS is most useful for:

  • ASemi-structured decisions
  • BRoutine transactions
  • CStrategic planning only
  • DOffice automation
View solution
Correct Option: A
DSS supports semi-structured decisions.
Q 08CERT-InHard

CERT-In is India's:

  • ACyber incident response team
  • BTax filing portal
  • CCustoms database
  • DTech accelerator
View solution
Correct Option: A
Computer Emergency Response Team — India.
Q 09AadhaarMedium

Aadhaar (UIDAI) was launched in:

  • A2009
  • B2014
  • C2016
  • D2000
View solution
Correct Option: A
UIDAI 2009.
Q 10ONDCMedium

ONDC stands for:

  • AOpen Network for Digital Commerce
  • BOnline National Data Corporation
  • COutsourced National Data Centre
  • DOpen Net Domestic Commerce
View solution
Correct Option: A
DPIIT-led, 2022.
Q 11ITILMedium

ITIL is a framework for:

  • AIT Service Management
  • BDatabase tuning
  • CCoding standards
  • DAudit only
View solution
Correct Option: A
Information Technology Infrastructure Library.
Q 12MetcalfeHard

Metcalfe's Law says network value scales as:

  • An²
  • Bn
  • Clog n
  • D2ⁿ
View solution
Correct Option: A
Network effect — value ∝ n².
Q 13Digital IndiaEasy

"Digital India" was launched in:

  • A2015
  • B2014
  • C2018
  • D2020
View solution
Correct Option: A
1 July 2015.
Q 14IT ActEasy

India's IT Act came in:

  • A2000
  • B1991
  • C2008
  • D2015
View solution
Correct Option: A
IT Act 2000; amended 2008.
Q 15Match systemsHard

Match:

(i) TPS (a) Strategic
(ii) MIS (b) Top mgmt
(iii) DSS (c) Middle mgmt
(iv) EIS (d) Operational
  • A(i)-(d), (ii)-(c), (iii)-(a), (iv)-(b)
  • B(i)-(a), (ii)-(b), (iii)-(c), (iv)-(d)
  • C(i)-(b), (ii)-(c), (iii)-(d), (iv)-(a)
  • D(i)-(c), (ii)-(a), (iii)-(b), (iv)-(d)
View solution
Correct Option: A
TPS — operational; MIS — middle mgmt; DSS — analytical; EIS — top mgmt.

86.12.1 Advanced Format Questions

AR 1Assertion-ReasonHard

A: Cloud computing offers on-demand resources.
R: NIST defines 5 essential characteristics of cloud.

  • ABoth true; R explains A
  • BBoth true; R does not explain A
  • CA true, R false
  • DA false, R true
View solution
Correct Option: A
S 1Statement-basedMedium

IS pyramid: (i) TPS. (ii) MIS. (iii) DSS. (iv) EIS.

  • AAll four (bottom-up)
  • B(i) and (ii) only
  • C(iii) and (iv) only
  • D(i) only
View solution
Correct Option: A
S 2Statement-basedHard

India DPI: (i) Aadhaar. (ii) UPI. (iii) ONDC. (iv) DigiLocker.

  • AAll four
  • B(i) and (ii) only
  • C(iii) and (iv) only
  • D(i), (ii), (iii) only
View solution
Correct Option: A

86.13 Quick Recall

ImportantQuick recall
  • IS Pyramid: TPS (op) → MIS · DSS (middle) → EIS / ESS · BI (top).
  • Other systems: ERP · CRM · SCM · KMS · GIS · OAS · ES · GSS.
  • Frameworks: Porter-Millar (1985) IT changes competition · Carr (2003) “IT doesn’t matter” · Brynjolfsson productivity paradox · RBV.
  • Strategic IT: cost · differentiation · focus · innovation · lock-in · BPR · network effects (Metcalfe n²) · platforms.
  • E-business: B2C · B2B · C2C · C2B · B2G/G2B/G2C · D2C.
  • India Stack DPI: Aadhaar 2009 · UPI 2016 · GSTN · CoWIN · ONDC 2022 · DigiLocker · AA framework · DEPA.
  • Software: System · Application · Middleware · Embedded · Open source · SaaS/PaaS/IaaS.
  • Governance: COBIT · ITIL · ISO 27001 / 20000 · COSO · TOGAF · NIST CSF; IT Act 2000 · DPDP Act 2023; CERT-In.
  • Cloud (NIST): IaaS/PaaS/SaaS/FaaS; Public/Private/Hybrid; AWS · Azure · GCP · Oracle · IBM.
  • Cybersecurity: CIA triad + AAA; threats (malware, ransomware, phishing, DDoS, APT) · defences (firewall, IDS, SIEM, MFA, encryption, zero trust).
  • Modern: Gen-AI · cloud-native · edge · 5G · IoT · blockchain · quantum · AR/VR · DevSecOps · low/no-code · hyperautomation · digital twins · sustainable IT · India AI Mission 2024 · Semicon India 2021.