• Internal Code :
  • Subject Code : MAN5901
  • University : Edith Cowan University
  • Subject Name : Information Systems Management

Industry 4.0

Q.1. Lu (2017) mentioned that the term “Industry 4.0” refers to the intelligent networking of industrial processes and products. The term was publicly introduced by a group of representatives from diverse fields like academia, business and politics, who worked under an initiative to improve the competitiveness of the German manufacturing industry. Another working group was created for the application of Industry 4.0, and according to their vision, cyber-physical systems comprising smart machines, smart systems for storage and establishing production facilities with autonomous information exchanging capabilities facilitate fundamental improvements in industrial processes.

In addition to this, these systems can trigger actions and controls each other in an independent manner to improve processes in manufacturing, material usage, life cycle management, engineering and supply chain (Vaidya, Ambad & Bhosle, 2018). The fourth industrial revolution is based on data and the way such data can be analysed and gathered for effective decision making has become a competitive factor. Therefore, the foundation of competitive advantage, in this context, is not only the production on a completely new and coordinated basis, but also embedding the products with digital services. Such digital services include the way companies filter the required information from the generated data set to support organizational decision making (Xu, Xu & Li, 2018). The below-mentioned diagram illustrates the timeline of the evolution of the industrial and manufacturing sector. 

Evolution of industrial and manufacturing sector timeline

Technologies involved in Industry 4.0

In terms of technology usage, while advanced digital technologies are at present used in the industrial sector, Industry 4.0 aims to transform manufacturing by utilizing novel technologies like big data analytics, simulation, augmented reality and additive manufacturing. There are basically nine technologies that are transforming industrial production through Industry 4.0.

Horizontal and vertical system integration – Industry 4.0 facilitates cohesiveness in departments and their functions through universal data-integration and enables truly automated value chains.

Big data and analytics – This technology includes the collection and analysis of data from several different sources in order to facilitate real-time effective decision making. These sources include the production system and equipment along with customer and enterprise management systems (Hofmann & Rusch, 2017).

Cybersecurity – The increased connectivity entails a need to protect critical manufacturing lines and industrial systems form cybersecurity threats. Thus, secure and reliable communications, with access management and sophisticated identity of users and machines are included in industry 4.0.

Autonomous robots – Autonomous capabilities will allow robots to interact with one other, and work side by side with individuals and at the same time, learn from them. Such robots provide a better range of competencies than those currently used in industries.

Stimulation – Stimulation will be used to leverage real-time data and mirroring of the physical world to optimize business operations. This will enable workers to test production activities in the virtual world and will facilitate improvement in quality and reduction in cost (Rojko, 2017).

The industrial internet of things (IoT) – IoT enables field equipment to interrelate and connect with one another. This technology includes interconnected sensors, devices and instruments networked together with computers for industrial application.

Cloud – Cloud refers to data sharing across company and sites boundaries. It includes accessing and storing data and programs over the internet instead of the hard drive of a computer.

Additive manufacturing – It is also known as 3D printing, which refers to a transformative approach which uses 3D object scanners or data computer-aided design (CAD) software to directly deposit hardware material in precise geometric shapes.

Virtual reality (VR) and Augmented reality (AR) – Such technologies allows user to add information in their visual field to subtly blend reality and virtual information that is superimposed on the real world (Hofmann & Rusch, 2017).

Impact of Industry 4.0 on business performance and processes

The velocity of disruption and the acceleration of innovation is hard to anticipate or comprehend as they constitute a source of constant surprise even for the most well informed and connected businesses. Indeed, Nagy, Olah, Erdei, Mare and Popp (2018) mentioned that the fourth industrial revolution is having a significant impact on business performance.

In terms of supply functions, industries are experiencing disruptions in existing value chains because of the introduction of new technologies that are creating new ways of serving existing business needs. Supply-side disruptions are also flowing from innovating and agile competitors who are able to access global digital platforms for marketing, research, distribution and development, in order to oust well-established incumbents. Digital innovations are enabling industries to improve their quality, speed or price at which value is delivered. In addition to supply-side disruptions, major shifts are also occurring on the demand side because of increasing consumer engagement, new consumer behaviour patterns and growing transparency.

Moreover, Pellegrini (2018) reported that the adoption of Industry 4.0 has a dramatic increase in revenue growth, customer satisfaction and productivity. Implementation of digital technologies facilitates the development of agile, responsive and flexible manufacturing, as wireless sensors, internet and other technologies are able to create "smart factories" that can track production in real-time. According to Fatorachian and Kazemi (2020), the overall impact of Industry 4.0 on business include increased productivity, reduction in operating costs, improved product quality and increased innovation.

In addition to this, industry 4.0 also makes the industry more time-efficient by automotive administrative and laborious jobs. Smart sensors can help enhance safety standards, while the implementation of new technology improves the business cost. Furthermore, the interconnectivity and mass customisation of products are opening new markets for businesses. Oztemel and Gursev (2020) suggested that Industry 4.0 can establish novel business models such as from mass production to individual approaches, and can enable businesses to connect and interact with customers in new ways through analysis of user behaviour, dynamic AI-based pricing and geo-location features.

Q.2. Rogerson, Miller, Winter and Larson (2017) defined Information systems (IS) as a study of complementary networks of software and hardware that are used by organizations and individuals for the collection, filtration, processing, creation and distribution of data. The rapid development of information technology is resulting in an increasing application of IS, for instance, e-commerce, e-government, office automation and e-business. Moreover, the increasing reliance of society upon information creation and communication using technology is leading to numerous ethical, social and political issues, in terms of scope and point of technique view.

Ethical issues within IS

The term ethics is described as the principles of conduct governing a group or individual, or a set of moral principles. The advent of new technology has a profound effect on human behaviour as it provides new capabilities which people did not have before. This, in turn, creates situations and environment which has not been addressed in ethical terms. In respect of IS, micro-ethics, which has traditionally been regarded as engineering ethics, focuses on professional ethical responsibilities and the way there are supposed to influence decision making of engineers at the individual level (Guragai, Hunt, Neri & Taylor, 2017).

Moreover, the macro-ethics aspect studies the issues form a society-wide or organisation-wide perspective. More often than not, it is difficult to exactly define the influence; decisions of engineers have on the complex socio-technical systems. This difficulty in connecting problems with ethical decisions of engineers’ results in a semantic argument over whether engineering ethics is macro-ethics at all or whether it is only attached to engineering ethics (Weippl, Schrittwieser & Rennert, 2016).

Diverse aspects of ethical issues in IS

Ethical issues from a technical point of view include accuracy, property, privacy, accessibility, along with occupational health and safety. Privacy is regarded as an individual requirement forms other organizations, individuals, intervention rights and government oversight (Warren & Lucas, 2016). This aspect of the information system, for its users, deals with information access, information storage, information collection etc. Presently, the conduct of employees such as their telephone records and internet records etc. are monitored by systems, even during their spare time which violates the privacy of their employees. In addition to this, the ethical issues also include ownership of information, IT employees’ occupational health and safety, the accuracy of the information, and accessibility of information. Such factors affect IS quality, including its security and reliability. IS permeates every aspect of life, improper use of such systems can damage or harm human life and the broader society (Tavani, 2916).

Copyrights

One of the ethical dilemmas resulting from the information system is of copyrights issue. Copyright refers to the safety given to programs, books and other creative works. Any piece of work which has an author can be copyrighted, which describes who can make derivatives from original work, who can make copies of work and can display work publicly (Baert, 2018). The ethical issues in respect of copyrights deal with the fair use of copyrighted content. Fair use is a limitation on the copyright law which allows the usage of protected work without the authorization of the copyright holder.

Regrettably, the guidelines for what is regarded as fair use and constitute copyright violation are not well defined.

Difficulties in Reaching a Resolution

It is difficult to reach a resolution for the fair use of copyrighted work because the below-mentioned guidelines that are used to determine if something constitutes fair use are subjective and ambiguous.

  • The nature of copyrighted work

  • The effect of the use of on the potential value for, or the market for the copyrighted work

  • The character and purpose of the use, such as whether the use is of non-profit purpose or commercial nature

  • The substantiality and amount of the portion used relative to the copyrighted content as a whole

Differences of Opinion

While copyright has legal standing, there is still a difference of opinion among those who favour copyrights and those with "anti-copyright" opinion. Rana (2018) explained that the copyright is intended to establish entrepreneurial, independent and self-sustaining authorship in securing the production of valuable scientific and literary works. Furthermore, it helps to protect the ability of publishers and authors to serve the ultimate public interest. On the other hand, the anti-copyright argument suggests that copyright acts like the Digital Millennium Copyright Act (DMCA) goes too far and limits freedom of speech. The Electronic Frontier Foundation (EFF) mentioned that copyright laws are a serious threat which jeopardizes fair use and impeded innovation and competition and interferes with computer intrusion laws (Spoo, 2016).

Different Ethical Principles

The key ethical principles related to the ethics in an information society are mentioned below (Paradice, Freeman, Hao, Lee & Hall, 2018).

  • Descartes rule of change

If an action cannot be taken repeatedly, it is not right to take at all.

  • Risk aversion principle

Take the action which produces the least potential cost or least harm.

  • Immanuel Kant’s categorical imperative

If an action is not right for everyone to take, it is not right for anyone.

  • Utilitarian principle

Take the action which achieves the greater or higher value.

  • Ethical “No Free Lunch” rule

Assume that virtually all intangible and tangible objects are owned by someone unless there is a specific declaration otherwise.

  • Golden rule

Do unto others as you would have them do unto you.

Outline how The Situation Could Be Resolved

One of the effective measures to navigate ethical waters is the code of ethics. It is a document which outlines what is regarded as the acceptable behaviour for a social or professional group and is agreed by group members (Gotterbarn, Bruckman, Flick, Miller & Wolf, 2017). In respect of the copyrights issue, the code of ethics of the Association for Computing Machinery can be used. The code includes a set of 24 imperatives framed as declarations of personal responsibility. In the ACM’s code, straightforward ethical instructions are given like admonition to be trustworthy and honesty, including specific admonitions related to information technology.

It uses the varied experiences and backgrounds of the group members to suggest what the acceptable behaviour is in the given context. Furthermore, it clarifies the acceptable standard of behaviour and provides clarity and consistency, by explicitly stating common guidelines to everyone in a clear manner (Gottebarn, Brinkman, Flick, Kirkpatrick, Miller, Vazansky & Wolf, 2018).

Q.3. Business Information Systems (BIS) refers to the set of inter-related processes that utilize IT infrastructure in a business enterprise to disseminate and generate the required information. Such systems are designed to facilitate effective decision making and to help enterprises to realize their objectives (Ababneh, Shrafat & Zeglat, 2017). BIS gathers data and required resources of IT infrastructure as inputs and processes them to cater to the information needs of different entities related to the business enterprises. Such systems include interrelated components that collectively work to execute input, process, output, control and storage actions to change data into info products. The processed information is used to facilitate forecasting, coordination and operational activities within an organization.

Types of information systems (Bichler et al., 2016)

Information systems implemented in organizations depend upon their level in the organization. There are mainly 7 types of information systems, namely:

  • Decision support system

  • Executive information system

  • Transaction processing system

  • Management information system

  • Enterprise resource planning and

  • Workflow system

  • Expert systems

In the given scenario, the business requirement is of an information system which can be operated by a single user and enables the business owner to keep track of business customers, information of completed jobs and sending reminders to customers. To cater for the said need the transaction processing system will be the most appropriate solution, as it would allow the business owner to keep a record of daily business activities including the information regarding the jobs completed (Mohd Salleh, Rohde & Green, 2017).

Transactional processing systems (TPS)

The transaction processing system is regarded as a set of information which processes data operation in a database system that controls transaction programs. In this context, a transaction refers to an event which generates or modifies data which is eventually stored in an IS (Thong & Yap, 2016). It is a type of information system which collects, stores, modifies and retrieves the transactions within an organization. In respect of the given scenario, TPS will manage the sales details resulting from day to day operations. It includes computer processing which takes place in the presence of a user and allows the user to request a transaction.

Transaction processing activities

Although in TPS the processing of transactions depends on the nature of the transaction, some of the general elements of TPS include the following:

  • Capturing and validating data

  • Transaction steps of processing

  • Maintenance of the database

Data capturing includes storage of data through automation of data source. TPS relies on electronic data which facilitates computer-to-computer communication without data entry repetition (Popovic, Puklavec & Oliveria, 2019). Moreover, it also includes validation of missing data items, valid values and valid codes. The data is then transferred into an automated machinery system for processing.

Importance of TPS

Untapped markets

TPS allows businesses to enhance their data processing capabilities and reduce their chances of errors. This provides businesses wider reach and penetrates into new market segments (Pearlson, Saunders & Galleta, 2019).

Handling of operations

TPS’s ability to simultaneously process several transactions allows businesses to handle business operations more effectively and save their resources in terms of data processing.

Advantages of TPS

  1. TPS reduces the risk associated with the loss of user information and keeps a stable database in the occurrence of network or terminal failure.

  2. TPS can process a large amount of data in batches or real-time.

  3. It also allows for customer/user to have confidence and reliability during transactions.

  4. The implementation of TPS minimizes the occurrence of an error during data transactions.

  5. It is user friendly.

  6. TPS can function anywhere, i.e. methods, location, language and geography are not a barrier in using the transaction processing system.

  7. Also, TPS is able to recover from system failures and can handle system failure according to the stage of the transaction (Pearlson, Saunders & Galleta, 2019).

  8. The implementation of TPS in organizations is regarded as the key feature in improving customer satisfaction.

Designing TPS for a small auto mechanic shop

In order to design a TPS for Bob’s establishment the first step is to define the source of information which will work as the input for TPS. In this case, this will the mechanics as they are the source of information related to customers, jobs completed on their vehicles and which mechanic has worked on which job and the supplies he used. Since all the said information is available to mechanics it is given that they are the source of data in this scenario (Bartherls, Alonso & Hoefler, 2017). Moreover, the next component of the TPS included processing which requires the breakdown of the provided information. The given information will be categorized with different identifiers in order to allow the TPS to process the same for reports. During this phase, an automated email component can be implemented which will send an automatic email to customers in case the service of their car is due. Moreover, after the process, the data will be stored in the TPS memory in the form of ledgers for data retrieval.

Moreover, in respect of the TPS’s database, the suggested structure uses the network structure which organizes data using nodes and branches, and a given node can be linked to several different higher parent nodes. This will cater for the data requirement of Bob's TPS as the data needs to gathered form 3 mechanics and transferred to the processing unit for further processing. In addition to this, TPS will also require a backup procedure to reduce data loss and counter breakdowns. The TPS of the auto mechanic shop will include a forward recovery system for the same (Fu, Zhang, Pei, Su, Liu & Qiao, 2017).

The suggested TPS includes data will use the batch processing system to process the data using limited resources. In this system, the data will be collected from each mechanic as he works on a car and the data will be converted into daily input transaction files which will be stored in memory. At the end of the day, the collected data will be processed to update the information in the database and generate management reports regarding. During this process, an automated email will be sent to clients regarding the due date of their car service.

Q.4. Cybersecurity threats like payroll fraud, ransomware, phishing campaigns and business email compromise are a threat to Australian businesses (Essa, Al-Shoura, Al Nabulsi, Al-Ali & Aloul, 2018). The said reports deal with the increasing reliance of businesses on information technology which in turn increases the risk of cyber-attacks. As Australian Cyber Security Center (n.d.a) mentioned, criminal and malicious attacks are deliberately crafted to exploit the known vulnerabilities for monetary or other forms of personal gains. Cyber incidents exploit the vulnerabilities associated with human factors, for instance, disclosing passwords and clicking on malicious links. The report further states that while there is no single mitigation strategy which can guarantee protection from cyber-attacks, there are some key recommendations which can be implemented to safeguard businesses.

Moreover, the articles suggest that human factors play a substantial role in the increasing incidents of cyber-attacks. According to the study conducted by IBM, human errors is the key factor responsible for causing 95% of the total cybersecurity breaches. This means that in case the human error was completely eliminated, 19 out of 20 breaches would not have happened (Liu, De Vel, Han, Zhang & Xiang, 2018). In the context of system security, human error refers to a lack of action or unintentional actions by users and employees which spread allow or cause a cyber-security breach.

In this respect, human errors can be classified into 2 broad categories, namely, skill-based errors and decision-based errors (Australian Cyber Security Center, n.d.a). The skill-based error includes lapses and slips, i.e. small mistakes which occur while performing familiar activities and tasks. In skill-based errors, the end-user knows what the proper course of action is, but fails to do so because of mistakes, negligence of temporary lapses. There are several reasons for such lapses to occur such as tiredness, distraction, not paying attention and brief lapse of memory.

On the other hand, decision-based errors occur when the user makes faulty decisions. There can be several different factors involved in such decision making, such as, not having proper knowledge, inadequate information or inaction.

In view of the significant role human factors plays in facilitating cyber-attacks, Australian Cyber Security Center (ACSC) has recommended below mentioned practical steps.

Updates

When people get an update of software on their system, apps or phone, they should do it promptly. This helps to protect identity and information by ensuring that system software is capable of dealing with new threats.

Passwords

ACSC recommends that people should have strong passwords and the second layer of authentication like fingerprint and codes for enhanced data protection (Australian Cyber Security Center, n.d.a).

Public WI-FI

Another recommendation is of not using public Wi-Fi networks for important activities like sending sensitive information, online shopping or online banking.

Phishing

This includes closely checking emails asking for verification of passwords, personal or bank details.

In addition to this, ACSC recommends 8 mitigation strategies to prevent malware delivery and execution, to limit the extent of cybersecurity incidents and to recover data and system availability. The proposed strategies include application control to prevent the execution of malicious programs and patching systems with 'extreme risk' vulnerabilities within 48 hours (Slay & Austin, 2017). In addition to this, the strategies also include configuring Microsoft Office macro settings to block internet macros, user application hardening to disable unneeded features in Ms Office, PDF viewers and web browsers. For, limiting the extent of incidents, the articles suggest restricting administrative privileges to applications and operating systems based on the duties of the user and multi-factor authentication while performing privileged actions.

For in house IT support, ACSC suggests that IT support should consider protecting key systems, making systems invisible to internet scanning tools and restricting access to RDP services, along with making sure that there is a contextual arrangement based on update assessment of threats.

The suggested recommendations are appropriate and effective with respect to preventing and mitigating incidents of cyber-attacks. As Mikolic-Torreira et al., (2017) mentioned, enabling multi factors authentication on remote desktop protocol services and ensuring that systems have supported operating system and patches can prevent others to view user session by listening on the network. Multi-factor authentication leverages the power of the active directory to enforce high-security protection of business resources.

However, according to Ladewig (2018), it would be better to use virtual private networks which allow remote users to securely access their business network without exposing their network to the entire internet. Thus, even though the recommendation of ACSC is effective, they need to be updated. Moreover, internet scanning tools are capable of obtaining sensitive system information which increases the threat related to data security. However, ACSC only suggests checking the visibility of systems against well-known internet scanning tools but does not provide effective measures to hide system information such as system name, installed software and the IP address from network scanning software (Sabillon, Cavaller & Cano, 2016).

ACSC should provide more through recommendations and should provide necessary details rather than suggesting key points. In addition to this, the recommendations also include restricting access to RDP services. This is important as Microsoft also warned the public about malware that can use RDP vulnerabilities.

The recommendations made by ACSC are effective, however, they do not provide detailed instructions to improve security and need to include the usage of technologies like VPN.

Q.5. Mobile applications have become technological tools for every industry which helps businesses to stay updated with the latest trends in the market to facilitate business growth. Tarute, Nikou and Gatautis (2017) reported that on average a healthy adult in America invests around 3 hours and 40 minutes on mobile-based devices, and around 80 to 85 per cent of that time is used to explore the app. Considering that ubiquity of mobile devices has changed the face of the retail industry, it is given that mobile applications have a huge impact on the retail industry.

Mobile shopping apps help the retail industry to manage their customer effectively by keeping them informed regarding products and services, but also by providing them extras through such applications. Mobile apps have transformed the way retailers work with their customers as there are not dependent on print advertisement and billboards. In addition to this, mobile applications have brought a high-level impact on the buying habits of customers by allowing them to match prices, track products and searching for other services providers (Olaleye, Salo, Sansi & Okunoye, 2018).

Mobile applications are shaping the customer experience approach of retailers through Omni-channel approach while allows them to the seamless and flawless flow of information from one channel to another. Today, mobile commerce is maturing faster than other sorts of retail or e-commerce engagements. Balaji, Roy, Sengupta & Chong (2018) stated that more than half of all online purchases by 2021 will be made through mobile applications. Mobile applications have enabled players in the retail industry to deliver a more synchronized experience. For instance, Amazon's mobile app offers real-time cart synchronization across mobile and electronic channels.

Amazon provides personalized recommendations, product recommendations and shopping histories based on the products in users' virtual cart. Moreover, usage of mobile applications is changing market competition by providing a mobile experience which keeps shoppers focused on the store. Walmart for example, allows customers to search for reviews and ratings of products in its store through their cell phones. This allows them to improve their conversion rates, as Tarute, Nikou & Gatautis (2017) mentioned that customers who view review and ratings are 240 per cent more likely to purchase the product. This is so mainly due to the fact that unlike internet browsers and work areas, apps are dedicated and make it simpler for customers to do what they are aiming for.

Moreover, mobile applications are changing business strategies and are forcing businesses to implement a customer-focused strategy as it is becoming easier for customers to shift from the provider. Best buy’s “Reward Zone” program is a perfect example of the same as it offers targeted promotions and customer points for purchases which can be redeemed online or at the store (Chen, Hsu & Lu, 2018).

Moreover, mobile-based advanced technologies offer real-time responsiveness, smooth flow of data and uninterrupted access to information which is facilitating the implementation of the mobile-first approach in the retail industry to make transformation efforts in business strategy. This is so mainly because businesses have to address the role of such technology, process and end-users in their strategy. In terms of the future prospect of mobile applications in the retail industry, augmented reality is one of the most exciting and novel concepts. Numerous efforts have been made to integrate augmented reality in retail business which offers an impressive and interactive window display of products (Lee, 2018).

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