Management Information System

Unit-1 / Part-3
IT Capabilities and their Organisational Impact

● Capabilities of Information technology

The organizational information technologies has impacts on many aspects of

business. In recent times, technology has become an ever increasing existence
in the workplace and it is one of the hot topics among the business world.

More and more businesses, large and small, are trying to incorporate the latest
technology into their operations.
 ● Multiple levels in IT based Capabilities

There have been many typologies for IT based capabilities which are varied in terms
of degree of aggregation. IT based capabilities can be categories into three groups in
terms of their aggregation level of IT resources.

Top level:- It described IT based capabilities according to their strategic values. The
main purpose of this level of analysis is "Demonstrate" IT resources. Hence we called
this level IT strategic level.

Middle level:- The level be technology functionality level and IT strategic level is IT
system level.

Lower level:- Lower level define IT based capabilities according to their functional
ability of specific technology, Components or application feature and this level is
called technology functionality area.
● IT organizational Impact

IT plays an important role in this generation. Traditional offices were designed

for people and paper. More recent offices were built for information systems,
computer rooms, cabling etc.

● Impact of the IT in different sector in organization

○ Marketing:
■ Product data form production, Research and development
■ Sales And Distribution sales, packing, distribution sections.
■ Advertising promotion of product

Eg: ERP
○ Human resources management
■ Human resources budget & Expenditure
■ Competitors
■ Turn over
○ Financial management:
■ Owner
■ Manager
■ Shareholders
IT Enabled Services (ITES)

The full form of ITES is Information Technology Enabled Services. The other
names of ITES are remote services or web-enabled services. ITES includes a
wide range of approaches and processes that use IT to enhance and increase an
organization’s efficiency. India claimed to be the most prestigious companies in
the world for outsourcing ITES (Information Technology Enabled Services).

ITES, or Information Technology Enabled Services, refers to the outsourcing of

processes in which the provider utilizes telecommunication technologies and the
Internet to provide those services, mainly for companies in non-information
technology (IT) fields.
These services provide a wide range of career options that include opportunities
in a call center, medical transcription, medical billing and coding, back-office
operations, HR services, web services, etc.

A wide range of areas such as manufacturing, healthcare, banking, insurance,

telecommunications, and finance use ITES.

Some of the services provided are call center services, medical transcription,
bio-tech research, insurance claims, payroll, and credit card processing. Other
services include customer care, human resources, administration, web
marketing, back-office data processing, and accounting.
Services offered by the ITES

ITES provides certain services including medical transaction & coding, e-CRM,
data mining & editing, electronic publishing and so on. Some other ITES services
are listed below.

1. KPO (Knowledge Process Outsourcing)

2. BPO (Business Process Outsourcing)
3. LPO (Legal Process Outsourcing)
4. GPO (Game Process Outsourcing)
5. Call Centres
6. Operations at Back Office
7. Logistics Management.
Famous Indian IT-ITES companies

1. CMC Limited (Computer Management Corporation Private Limited)

2. HCL Technologies Limited
3. Infosys Technologies Limited
4. TCS (Tata Consultancy Services Ltd)
5. Tech Mahindra Limited
6. NIIT Technologies
Advantages of ITES

1. Organization & Companies can expand and enhance their versatility through
BPO (Business Process Outsourcing), which is a significant segment of
ITES.
2. ITES enhanced and improved organizational versatility is by increasing the
rate of company processes, events and assignments,
3. SCM (supply chain management) through the efficient and advantageous
use of chain partners and outsourcing of company processes improves the
pace of specific company duties and functions.
Transaction Processing System (TPS)

A transaction processing system or TPS refers to an information processing

system used for business transactions that involve the retrieval, collection, and
modification of transaction data. It offers an execution environment that ensures
data availability, security, and integrity. Moreover, such a system ensures fast
response time and accuracy.
ACID properties of Transactions
ACID (Atomicity, Consistency, Isolation, Durability) is a set of properties of
database transactions. In the context of databases, a single logical operation on
the data is called a transaction.
1. Atomicity guarantees that one account won't be debited if the other is not
credited as well.
2. Consistency a transaction can't break the rules, or integrity constraints, of
the database. If an integrity constraint states that all accounts must have a
positive balance, then any transaction violating this rule will be aborted.
3. Isolation This means that no operation outside the transaction can ever see
the data in an intermediate state:
4. Durability refers to the guarantee that once the user has been notified of
success, the transaction will persist, and not be undone.
Components of TPS

1. Input functions: Securing and inputting the data of the transactions that
have taken place
2. Output functions: Producing the report and record of the input data to be
used for future references and validating the transaction
3. Storage functions: Storing the data from both input and output operations
and ensuring the availability of data for operations like information access,
retrieval, sorting, and updating.
4. Processing functions: Computing, calculating, sorting, and defining the input
data to get the desired results.
Types of Transaction Processing Systems

1. Batch processing

Through batch processing, a TPS interprets sets, or batches, of data by grouping

items based on similarities. Batch processing can create a time delay because it
reviews several sets of data simultaneously, requiring more computing power.

Example: A customer pays for a subscription service at the end of the month, The
TPS system processes the transactions as a batch because they occur at the same
time. In this case, a delay in processing transactions is acceptable because the
system only interprets batches once per month.

i.e. Cheque clearance, Bill Generation and Credit Card Transactions etc.
2. Real-time Processing

Real-time processing is a method to process transactions as they appear. This

helps prevent delays in processing and can provide a more accurate result.

Example: An e-commerce website might use a TPS to process credit card

transactions in real-time to ensure payment before the company starts its
fulfillment process. Processing transactions in real-time also helps the company
identify and address errors quickly, as well as increase its overall response times.

i.e. Reservation system, Library Loan System, etc.

Characteristics of TPS

1. Rapid Response- Fast performance with a rapid response is critical. Input

must become output in seconds so customers don’t wait.
2. Reliability- Organisations rely heavily on their TPS with failure possibly
stopping business. Back-up and recovery procedures must be quick and
accurate.
3. Inflexibility- A TPS wants every transaction processed in the same way
regardless of user or time. If it were flexible there would be too many
opportunities for non-standard operations.
4. Controlled Processing- The processing must support an organisation's
operations.
Importance of TPS

1. Handling and managing operations

2. Fast response ( quick processing)
3. Real time backup
4. Tapping the Raw Markets
Advantages of TPS

1. It is a highly cost-effective and fast solution to all the revenue-related

operations of any given organization.
2. It works through a highly stable and reliable database that stores and
reflects the information as and when desired without any risk of information
loss.
3. It allows for a quick recovery from any operational failure causing a very
little delay in the transaction processing.
4. It allows remote functioning giving the freedom of free operation to
businesses who want to grow across the globe.
5. It can be used both in a real-time manner and batch-processing manner.
 Disadvantages of using TPS

1. Every business has different needs that must be dealt with exclusively. This
calls for designing a customized solution for every single business that has
some specific requirements.
2. Though it is a cost-effective solution, the initial cost of setting up and
installation can be on the higher side.
3. Even with a highly sophisticated setup, you may need to deploy a large
number of workforces for data input, managing and recording inventory, etc.
4. Though TPS is designed for handling a lot of data and work, overloading may
lead to a system crash.
5. You need to have a certain specification of the hardware for TPS software to
work smoothly.