Unit 1.5: Importance of Information Systems in Society

--:-- --
↓ Scroll for more

Unit 1.5

The Importance of Information Systems to Society

IT 233: Business Information Systems

Learning Objectives 🎯

By the end of this chapter, you will be able to describe, explain, identify, and discuss the societal role of Information Systems.

  • ✅ Describe the role of IS in driving economic growth and globalization.
  • ✅ Explain how IS has transformed social communication and access to education.
  • ✅ Identify the benefits of IS in public services (e-government) and healthcare.
  • ✅ Discuss major ethical and social challenges like the digital divide and privacy.

Beyond Business: IS as Societal Infrastructure

Information Systems have moved beyond company walls to become a fundamental part of our daily lives.

🌐 Economy

Driving global markets and digital services.

💬 Communication

Reshaping how we interact and form communities.

🏛️ Governance

Transforming how public services are delivered.

📊 Economic Impact: The Digital Engine

The Digital Economy

  • E-commerce
  • Digital Services (SaaS, Streaming)
  • Online Advertising
  • A significant, growing part of the global GDP.

Globalization 2.0

  • Seamless flow of information & capital.
  • Creates new markets and industries.
  • Intensifies global competition.

Activity: Sort the Economic Impacts

Step 1 — click an item to select it (turns gold). Step 2 — click the correct bin to place it. Green = correct, red = incorrect.

E-commerce Streaming & SaaS Online Advertising Seamless Capital Flow New Global Markets Intensified Competition

💻 Digital Economy

🌐 Globalization 2.0

📱 Real Case: M-Pesa and Kenya's Digital Economy

  • Launched in 2007 by Safaricom: send and store money by SMS on a basic phone, with no bank account.
  • Shopkeepers act as agents, turning cash into mobile money and back.
  • A 2016 study by MIT and Georgetown economists (Suri & Jack, Science) found it lifted about 194,000 households, around 2% of Kenya's households, out of extreme poverty.
  • The biggest gains were among households headed by women.

An information system became national infrastructure, just like roads or electricity.

💬 Social Interaction & Communication

Benefits of Connectivity

  • Maintain relationships across distances.
  • Form new communities based on shared interests.
  • Instant access to information and news.

Challenges of "Always-On"

  • Potential for social isolation.
  • Cyberbullying and online harassment.
  • Creation of ideological "echo chambers."

📚 Access to Information & Education

⚡ One of the most profound impacts of IS is the democratization of knowledge.

Instant Information

Search engines like Google put vast libraries of human knowledge at our fingertips.

Education for All

Online platforms (Coursera, Khan Academy) break down barriers of cost and location to learning.

🏛️ Transforming Public Services & Government

E-Government: Using IS to deliver government services more efficiently and transparently.

  • Online tax filing and vehicle registration.
  • Digital voting systems (in some regions).
  • Public information portals for transparency.

"Smart City" Initiatives: Using IS to manage traffic, optimize energy, and improve public safety.

🇪🇪 Real Case: Estonia, a Digital Government

  • Every citizen has a digital ID used to sign documents, file taxes and see medical records.
  • X-Road (since 2001) lets government databases share data securely, so citizens give each piece of information only once.
  • Online voting (i-Voting) has been possible since 2005, and in national elections since 2007.
  • Since late 2024, every public service can be done online, even divorce.

Compare: what would Nepal's Nagarik App need to work like X-Road?

🎬 Estonia's Digital Government

⚕️ Advancements in Healthcare

Electronic Health Records (EHRs)

  • Improves accuracy of patient info.
  • Increases accessibility for providers.
  • Reduces medical errors.

Telemedicine & Research

  • Remote consultations with doctors.
  • Increases access to care in rural areas.
  • Big data analysis accelerates medical research.

🚁 Real Case: Blood by Drone in Rwanda

  • Since 2016, the company Zipline has flown blood and medicines to rural Rwandan hospitals by drone.
  • A health worker orders by text or app, and the drone drops the package by parachute.
  • Trips that took hours by road now take minutes.
  • The service relies on an IS: ordering, stock tracking, flight planning and GPS.

Think: which hill districts of Nepal could benefit most from this?

🎬 Blood by Drone in Rwanda

🧪 Activity: Which Area of Society?

Economy, Communication, Education, Government or Healthcare?

1. A farmer in Dolakha consults a doctor over a video call. → Healthcare (telemedicine)

2. You renew your driving licence through an online portal. → Government (e-government)

3. A student in Pokhara takes a free Harvard course online. → Education

4. A Thamel shop sells pashmina to buyers in Germany. → Economy (globalization)

5. Nepali workers abroad call family daily on Viber. → Communication

⚖️ Critical Ethical & Social Issues

The benefits of IS are powerful, but they are accompanied by significant societal challenges we must address.

The Digital Divide

Privacy Concerns

Misinformation & Bias

Challenge 1: The Digital Divide

The Digital Divide: The gap between those who have access to modern information technology and those who do not.

This gap exacerbates existing inequalities based on:

  • Socioeconomic status (Cost)
  • Geographic location (Rural vs. Urban)
  • Age and disability
  • Educational background

🌍 The Digital Divide in Numbers

Online (2024)

About 5.5 billion people, roughly two-thirds of the world.

Still offline

About 2.6 billion people, mostly in rural areas and low-income countries.

Source: ITU, Facts and Figures 2024.

Having a phone signal is not the same as being included: cost, skills, language and electricity matter too.

Challenge 2: Privacy & Misinformation

🔍 Privacy Concerns

  • Vast amounts of personal data are collected by corporations and governments.
  • Raises questions about surveillance, data security, and individual rights.
  • The "convenience vs. privacy" trade-off.

🌪️ Misinformation & Disinformation

  • Platforms designed for connection can also spread false information rapidly.
  • Serious consequences for public discourse, health, and democracy.
  • Difficult to regulate without infringing on free speech.

🗳️ Quick Poll: Is "Free" Really Free?

Hands up: would you let a free app read your contacts and location in exchange for using it?

  • Cambridge Analytica (2018): a Facebook personality quiz collected data from its users and their friends.
  • Data on up to 87 million Facebook users was used for political advertising.
  • In 2019 the US FTC fined Facebook US$5 billion for privacy failures.

If you are not paying for the product, your data often is the product.

🔎 Activity: Check It Before You Share It (SIFT)

A viral post says: "Government will close all bank accounts without a national ID by Friday!" What do you do?

  • Stop: don't share yet. Strong emotion is a warning sign.
  • Investigate the source: who posted it? Is it an official account?
  • Find better coverage: do trusted news sites or the central bank report it?
  • Trace the claim: find the original notice or document.

SIFT method by digital-literacy researcher Mike Caulfield.

Challenge 3: Algorithmic Bias

Algorithmic Bias: When an IS algorithm's output creates unfair outcomes, reflecting and amplifying human biases.

Examples of potential bias:

  • Hiring: AI tools favoring candidates from certain backgrounds.
  • Loan Applications: Algorithms denying loans based on biased historical data.
  • Criminal Justice: Predictive policing models that unfairly target certain neighborhoods.

⚖️ Real Case: A Biased Risk Score (COMPAS)

  • US courts used a software tool called COMPAS to predict whether a defendant would commit another crime.
  • In 2016 the newsroom ProPublica checked its scores against what actually happened.
  • Among people who did not reoffend, Black defendants were wrongly labelled high risk 45% of the time, compared with 23% for white defendants.
  • The tool never asked about race, but other data (like neighbourhood and arrest history) carried the bias in.

Removing a sensitive field does not remove bias from the data.

🎬 How Bias Gets Into a Risk Score

Practical Application: IS in Nepal

Case Study: Opportunities & Challenges

  • Digital Economy 🚀: Payment gateways like eSewa and Khalti have revolutionized commerce, but cash is still dominant outside urban centers.
  • E-Government 🏛️: The Nagarik App aims to centralize public services, but faces challenges with data integration and digital literacy.
  • Digital Divide 🏔️: While mobile internet is widespread, reliable, high-speed access remains a major challenge in remote and rural areas, limiting access to telemedicine and online education.

Payment Machines in Nepal

Four bank card and QR payment machines used by shops in Nepal.

Key Takeaways 🎯

  • IS is a primary driver of the global digital economy and globalization.
  • IS has revolutionized communication and education, but also created challenges like echo chambers and cyberbullying.
  • E-government and "smart city" initiatives use IS to improve public services, while EHRs and telemedicine transform healthcare.
  • The widespread use of IS brings critical societal challenges: the digital divide, privacy concerns, misinformation, and algorithmic bias.

💬 Discuss in Groups (3 minutes)

1. Which single IS would do the most good for rural Nepal: mobile money, telemedicine, e-government or online education? Why?

2. Should Nepal adopt Estonia-style online voting? What could go wrong?

3. A bank wants to use an algorithm to approve loans. What rules would you set to keep it fair?

Exam Practice 📝

Short answer

  1. What is the digital divide?
  2. Give two examples of how information systems improve public services.
  3. State two ethical issues raised by information systems.

Exam Practice 📝 (continued)

Long answer

  1. Discuss the importance of information systems to society, with examples from the economy, education, healthcare, and government.
  2. Explain the major ethical and social issues raised by information systems, with reference to Nepal.

Revise the answers in the full note.

Image & Video Credits

Images

  • World map of submarine cables (2007): Rarelibra, public domain, via Wikimedia Commons
  • Kagugu Classroom, Kigali: One Laptop per Child, CC BY 2.0, via Wikimedia Commons
  • Estonian ID card reader (gift selection of the Estonian Presidency of the Council of the EU): EU2017EE Estonian Presidency, CC BY 2.0, via Wikimedia Commons
  • Zipline Drone Rain Recovery: Roksenhorn, CC BY-SA 4.0, via Wikimedia Commons
  • Share of individuals using the internet (2021 data, ITU): Our World in Data, CC BY 4.0, via Wikimedia Commons
  • POS machines of Nepal: Nirjal stha, CC BY-SA 4.0, via Wikimedia Commons

Videos (YouTube)

  • Freethink, "The Most Advanced Digital Government in the World" (0–47 s); "most advanced" is the presenter's framing
  • Al Jazeera English, "Drones Deliver Blood to Remote Hospitals in Rwanda" (19–71 s)
  • Above The Noise (KQED), "Are Risk Assessment Algorithms Fair, or Racist?" (209–256 s)

Thank You

Let's discuss the chapter questions.

Next Up: Chapter 6 - Foundations of Business Intelligence

Back to Course Notes

📖 Read the full note