So assuming you got your z/OS 1.1 DASD files from a special bay of pirates (Magnet link) and you now totally wanna try out this "cool software", those bankers are using.
First: Bankers aren't cool. Drugs, especially Cocaine aren't cool and hookers aren't that expensive either, you can afford them with more productive jobs as well.
Second: IBM products aren't cool either.
Now that that's said.
Check out this link for setting up the networking for your virtual main frame under Hercules: http://modernhackers.com/install-ibm-z-os-mainframe-under-gns3
First you might wanna arrange your windows like this with two open x3270 terminal connecting to your Hercules interface like shown in the pic here.
After you have this. You enter "ipl a80" in the Hercules interface and you will see after a moment in one of the two x3270 windows, how the system starts booting.
When it's done booting it will look like that.
The second window now provides you with a management interface.
One of those x3270 windows is a shell the other one is the configuration management tool from z/OS.
You can switch forth and back, using ESC in the Hercules terminal (the very left one) in order to either have a Hercules shell or have an overview of the CPU usage.
Now you can type in the right upper shell:
After that you should be able to connect to your z/OS using telnet on port 1023.
When you wanna shut down your system, as usual with IBM, it's not so simple.
First you go into the x3270 window and type "S SHUTSYS" and press enter.
You wait until it looks like that and then type "Z EOD" and then press enter.
It will write out the logs for a while and then will tell you, that it's done.
At that point where it looks as following you can go to the Hercules terminal and enter quit in order to terminate the emulator.
Here I typed another time "Z EOD", just to make sure it's done writing everything down, because z/OS (like AIX as well) are absolutely pussies, when it comes to corrupted file systems.
They'll tell you "high availability... blah blah". BS.