INFORMATION SYSTEMS

OUTLINE
 Definitions
 Types of Information Systems
 Information Systems Vs Information Technology
 Expanding Roles of IS
 Classification of IS
 Enterprise Resource Planning
 Information Systems Development
 IS as Discipline
 Information systems: Opportunities and Challenges
 Conclusion
 DEFINITIONS

Data
Raw facts such as an employee’s name and number of hours worked in a
week, inventory part numbers or sales orders.
Information
A collection of facts organized in such a way that they have additional value
beyond the value of the facts themselves.

Information
Data

Rs35,000 12 Units Salesperson: J. Jones Sales

Rs12,000 J. Jones Western Data Processing Territory: Western Region
Region Rs. 100,000 100 Current Sales: 147 Units =
Units 35 Units Rs147,000
 Definitions

Information Systems
An information system(IS) is typically considered to be a set of interrelated elements
or components that collect(input), manipulate(processes), and disseminate (output)
data and information and provide a feedback mechanism to meet an objective.
Open System
Close System
TYPES OF INFORMATION SYSTEMS

1. Informal Information System

2. Formal Information System
 CHAPTER OPENING CASE

Upstream activities: exploration

and production

Downstream activities: refining,

marketing, transportation, sales
COMPUTER-BASED INFORMATION SYSTEM

An Information System is an organized combination of people, hardware, software,

communication networks and the data resources that collects, transforms and disseminates
information in a organization.
TYPES OF INFORMATION SYSTEMS

Computer-based information systems (CBIS) use

computer technology to perform some or all of
their tasks and are composed of:
 Hardware
 Software
 A Database
 A Network
 Procedures
 People
INFORMATION SYSTEMS INSIDE YOUR
ORGANIZATION
INFORMATION TECHNOLOGY OUTSIDE YOUR ORGANIZATION
BREADTH OF SUPPORT OF INFORMATION SYSTEMS

 Functional area information systems: It

support particular functional areas in an
organization.
 Enterprise resource planning systems: It
tightly integrate the functional area
information systems via a common database.
BREADTH OF SUPPORT OF INFORMATION SYSTEMS

 Transaction processing systems: support the

monitoring, collection, storage, and processing of
data from the organization’s basic business
transactions.
 Inter organizational information systems: IT
connect two or more organizations. Examples
are supply chain management systems and
electronic commerce systems.
INFORMATION SYSTEMS SUPPORT FOR ORGANIZATION
EMPLOYEES

 Office automation systems: typically support the

clerical staff, lower and middle managers, and
knowledge workers. These people use OASs to
development documents, schedule resources, and
communicate.
 Functional area information systems: It
summarize data and prepare reports, primarily for
middle managers.
 Business intelligence systems: It provide
computer-based support for complex, non-routine
systems, primarily for middle managers and
knowledge workers.
 Expert Systems: It attempt to duplicate the work
of human experts by applying reasoning
capabilities, knowledge, and expertise within a
specific domain.
 Dashboards: It support all managers by providing
rapid access to timely information and direct
access to structured information in the form of
reports.
COMPETITIVE ADVANTAGE AND STRATEGIC INFORMATION
SYSTEMS

 Competitive Advantage: An advantage over

competitors in some measure such as cost,
quality, or speed, leads to control of a market and
to larger- than average profits.
 Strategic Information Systems (SIS) provide a
competitive advantage by helping an organization
to implement its strategic goals and to increase its
performance and productivity.
2.3 WHY ARE INFORMATION SYSTEMS
IMPORTANT TO ORGANIZATIONS & SOCIETY

• IT will reduce the number of middle

managers.
• IT will change the manager’s job.
• IT impacts employees at work.
• IT provides quality-of-life improvements.
 IS VS IT Payroll
System

INFORMATION
TECHNOLOGY Inventory
System
Hardware
Software are used to build
INFORMATION
Databases
SYSTEMS
Networks
Marketing
Other related
System
components

Customer
Service
System
EXPANDING ROLES OF IS
1. Data Processing: 1950s-1960s
2. Management Reporting: 1960s-1970s
3. Decision support: 1970s-1980s
4. Strategic and End User Support: 1980s-1990s
5. Global Internetworking: 1990s-2000s
 CLASSIFICATION OF IS
Information Systems

Operations Support
Management Support
System
System

Transaction Office Management Decision Executive

processing Process control automation support information
systems information
systems systems systems systems systems
1. Operations support systems process data generated by business operations
Major categories are:
i) Transaction processing systems
ii) Process control systems
iii) Office automation systems
2. Management Support Systems provide information and support needed for effective
decision making by managers
Major categories are
i) Management Information System
ii) Decision Support Systems
iii) Executive Information System
1. Operations Support System
i) Transaction processing systems

• Process business exchanges

• Maintain records about the exchanges
• Handle routine, yet critical, tasks
• Perform simple calculations

ii) Process control systems monitor and control industrial processes.

iii) Office automation systems automate office procedures and enhance office
communications and productivity.
2. Management support systems provide information and support needed for effective
decision making by managers
Major categories are:

i) Management information systems

 Routine information for routine decisions
 Operational efficiency
 Use transaction data as main input
 Databases integrate MIS in different functional areas
ii) Decision Support System
• Interactive support for non-routine decisions or problems
• End-users are more involved in creating a DSS than an MIS

iii) Executive information systems

provide critical information tailored to the information needs of executives
Other categories
a) Expert systems
b) End user computing systems
c) Business information systems
d) Strategic information systems
a) Expert Systems are knowledge-based systems that provides expert advice and act as
expert consultants to the users
b) End user computing systems support the direct, hands on use of computers by end
users for operational and managerial applications
c) Business information systems support the operational and managerial applications of
the basic business functions of a firm
d) Strategic information systems provide a firm which strategic products, services, and
capabilities for competitive advantage
ENTERPRISE RESOURCE PLANNING (ERP)

 Integrated programs that can manage a

company’s entire set of business operations
 Often coordinate planning, inventory
control, production and ordering
INFORMATION SYSTEMS DEVELOPMENT
IS AS DISCIPLINE

IS is an interdisciplinary field
influenced by Computer Science, Political
Science, Psychology, Operations Research,
Linguistics, Sociology, and Organizational
Theory.
Exercise. Match the type of information system with the organizational
level where they are most commonly used:

 Transaction Processing Systems (TPS)

 Management Information Systems (MIS)
 Decision Support Systems (DSS)
 Expert Systems (ES)

Top
Managers
Middle
Managers
First-Line
Managers

Operatives
TYPES OF INFORMATION SYSTEMS
AND SYSTEMS DEVELOPMENT
• Transaction Processing Systems (TPS)
– Automate handling of data about business activities
(transactions)
• Management Information Systems (MIS)
– Converts raw data from transaction processing system into
meaningful form
• Decision Support Systems (DSS)
– Designed to help decision makers
– Provides interactive environment for decision making
TYPES OF INFORMATION SYSTEMS
AND SYSTEMS DEVELOPMENT
• Expert Systems (ES)
– Replicates decision making process
– Knowledge representation describes the way an
expert would approach the problem
CHALLENGES

1. Workforce downsizing
2. Information overload
3. Employee mistrust
4. Difficult to built
5. Security breaches
 OPPORTUNITIES

1. Enhanced global competitiveness

2. Capture market opportunities
3. Support corporate strategy
4. Enhance worker productivity
5. Improve quality of goods and services
 CONCLUSION

Information Systems are

indispensable to the business,
industry, academia and any
organization to meet the future
challenges