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Problems in Business Are Undesirable: Basic Ideas

The document discusses the basic concepts of information systems including the differences between data and information, how information systems are organized into different levels and categories, and the key components and functions of transaction processing systems, management information systems, decision support systems, and executive support systems. It also covers characteristics of information needed at different managerial levels and topics related to office automation systems.

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Mayank Sharma
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108 views32 pages

Problems in Business Are Undesirable: Basic Ideas

The document discusses the basic concepts of information systems including the differences between data and information, how information systems are organized into different levels and categories, and the key components and functions of transaction processing systems, management information systems, decision support systems, and executive support systems. It also covers characteristics of information needed at different managerial levels and topics related to office automation systems.

Uploaded by

Mayank Sharma
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Basic Ideas

 Problems in business are undesirable


situations
 To solve problems, managers must make
decisions to resolve the undesirable
situation
 Decisions involve selecting a solution from
among several alternatives.
 Good decisions require information
 Information systems produce information
(among other things)
1
 Data are defined as raw facts (dates, monetary amounts,
names, addresses, account numbers, prices, etc.)

 Information is processed data put into some context.


Contextual elements include things like relevance,
completeness, accuracy, or timeliness).

 A system is a set of components that work together to produce


a common goal (or goals)

 An information system is a set of components whose goal is


to produce information that benefits an organization

2
Characteristics of Management
Information

Needs to be new

Needs to be ‘True’

It is required to be about something

The transmission of Information is always through regular


communication channels

All rules of effective communication are relevant to Information


transmission
The Organizational Pyramid
Categories of Systems

 Operational Level System:-


Supports operational managers by
keeping track of elementary activities
and transactions of the organization
 Management Level System :-
Serves the monitoring , control,
decision making and administrative
activities of middle managers.
 It provides periodic reports.
 They focus on less structured
decisions
 They often answer “what if” questions
 Strategic Level :- Helps senior
management tackle and address
strategic issues and long term trends.

 Their concern is matching changes in


the external environment with
existing organizational capability
Characteristics of Information
at Different Managerial Levels

 Different management levels have


different information needs
 Information needed by different
managerial and operational levels
varies in
 the time span covered
 level of detail
 Source
 other characteristics over a broad spectrum
Characteristics of Information
at Different Managerial Levels

 Data Range
 Amount of data from which information
is extracted

 Time Span
 How long a period the data covers

 Level of Detail
 Degree to which information is specific
Characteristics of Information
at Different Managerial Levels

 Source: Internal vs. External


 Internal data: collected within the organization
 External data: collected from outside sources
 Media, newsletters, government agencies, Internet

 Structured and Unstructured Data


 Structured data: numbers and facts easily stored and
retrieved
 Unstructured data: drawn from meetings,
conversations, documents, presentations, etc.
 Valuable in managerial decision making
Information System
Components of an IS include :

14
Ways to Organize Information Systems

 By the groups they serve


 Operational level
 Management level
 Strategic level

 By functional area
 Sales and marketing
 Manufacturing and production
 Finance and accounting
 Human resources

15
The Four Major Types of Information Systems

16
Transaction-Processing Systems (TPS)

 TPS are the basic business systems that


serve the operational level of the
organization.

 TPS is a computerized system that


performs and record daily transactions
necessary to conduct business.

 Ex: - Sales order entry , Hotel Reservation


Systems , Payroll
TPS

• Entry point for recording data

• Critically important to the functioning of the organization

• mostly for predefined, structured tasks

• usually has high volumes of input and output

• provides data to systems which summarize the data into


information for the use of higher levels of management

 needs to be fault-tolerant.
TPS

 Managers need TPS to monitor the


status of internal operations and the
firms relation with the external
environment

 Operation managers use TPS for ad-


hoc reports
Typical Applications of TPS

20
Management Information System (MIS)

MIS serve the management level of the organization,


providing managers with reports and online access to the
organization’s current performance and historical records.

MIS are oriented almost exclusively to internal events

MIS serves the functions of planning, controlling, decision


making, or problem solving at the management level

Data collected by a TPS is usually the basis for an MIS

21
MIS
 MIS summarizes and reports on the Company’s
operations.

 Transaction data from TPS is compressed and


presented in the form of report

 MIS serves managers primarily interested in weekly ,


monthly and yearly results.

 MIS provides answers to routine questions


Management Information Systems (MIS)
A sample MIS report

23
MIS
TPS MIS
Order Processing SALES
DATA
System

ORDER FILE UNIT


PRODUCT
Materials Resource COST MIS REPORTS
Planning System
PRODUCT
CHANGE
PRODUCTION MASTER FILE
DATA
General Ledger
EXPENSE MANAGERS
System DATA

ACCOUNTING FILES MIS FILES


Decision Support Systems (DSS)

 DSS also serve the management level of the organization.

 It helps managers make decisions that are unique ,


rapidly changing and not easily specified in advance

 They address problems where the procedure for arriving


at a solution may not be fully predefined in advance

 It support more complex and nonroutine decision-


making and problem-solving activities.

 It uses information from TPS and MIS


DSS
 DSS has more analytical power then
other systems

 They use a variety of models to


analyze data

 They are interactive – users can


change assumptions , ask new
questions and include new data
DSS
 For example a bank loan officer verifying
the credit of a loan applicant

 an engineering firm that has bids on


several projects and wants to know if they
can be competitive with their costs.
Executive Support Systems (ESS)

 Provide timely, concise information about


organization to top managers

 Senior managers use ESS

 They address non routine decisions requiring


judgment , and insight.

 Combination of MIS and DSS designed specifically


for upper levels of management
ESS
 Employ most advanced graphics
software

 Makes use of less analytical models

 Ex:- What are the competitors doing?


In what business should we be ?
Office Automation System
 The term office automation refers to all tools and methods
that are applied to office activities which make it possible to
process written, visual, and sound data in a computer-aided
manner.

 Office automation provide elements which make it possible to


simplify, improve, and automate the activities of a company

 It also includes the following activities:


 exchange of information
 management of administrative documents
 handling of numerical data
 meeting planning and management of work schedules
 The backbone of office automation is a
LAN, which allows users to transmit
data, mail and even voice across the
network.

 All office functions, including dictation,


typing, filing, copying, fax, telephone
and record management operations, fall
into this category.
 The term "office suite" refers to all software
programs which make it possible to meet office
needs.
 In particular, an office suite therefore includes
the following software programs:
 word processing
 a spreadsheet
 a presentation tool
 a database
 a scheduler
 Generally, there are three basic
activities of an office automation
system:
 data storage of information,
 data exchange,
 data management

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