The Role of Information System on An

Organization

Any business, big or small, must have a system in place to

collect, process, store and share data. Companies use modern
technology to streamline and automate these operations.
Information systems are now playing a crucial role in data
processing and decision making. When used correctly, they can
positively impact an organization's overall performance and
revenue.

Information System (IS)

At the most basic level, an information system (IS) is a set of
components that work together to manage data processing and
storage. Its role is to support the key aspects of running an
organization, such as communication, record-keeping, decision
making, data analysis and more. Companies use this
information to improve their business operations, make
strategic decisions and gain a competitive edge.
Information systems typically include a combination of
software, hardware and telecommunication networks.
Businesses Pre-Information Systems
Until the 1990s, before the widespread adoption of personal
computers and the Internet, companies were using information
systems to manage data processing and record-keeping activities
associated with business transactions like maintaining the
general ledger (book keeping), payroll, billing, inventory
management, etc. The focus was mainly on maintaining files
and databases related to day-to-day operations.
Communications, both internal and external, relied on paper,
telephone, faxes, and other analog media. The arrival of the
mainstream internet in the 1990s expanded business capabilities
and the role of information systems to a global system of
interaction.

Modern Day Use of Information Systems

Today, companies have eliminated the inaccuracy of paper-
based tracking by implementing ERP systems. In a recent study
conducted by Panorama Consulting Solutions, 63 percent of
companies used their ERP software to eliminate inefficiencies in
processes such as order tracking. Instead of standalone computer
systems, ERP uses a unified program that links various
functional departments such as finance, HR, manufacturing,
warehouse, planning, purchasing, inventory, sales, and
marketing. Once one department is finished updating and
processing the order, it is automatically routed to the next
department so that everyone is alerted to changes made.

Adopting the Global Market

Many businesses have begun to participate in the global market,
as it presents a chance for greater revenue and larger business
prospects. The global information systems market has seen
consistent demands from several businesses. As businesses
grow, especially those intersecting with global relations,
information systems are used to manage operations accurately
without growing the number of employees.
The growing supply chains require that software solutions be
used in the following sectors:
 Web-based ordering
 Customer relationship management
 Product configuration

The Future of Information Systems

As companies try to reduce costs, improve productivity,
employers are looking to ERP systems to help them grow and
remain competitive globally. Information systems have
enhanced productivity for businesses. As businesses and
organizations today require more and more technical skills,
companies are looking for employees who will help manage and
operate the various information-based tools.

 Organizing the Information-Systems Function

In the early years of computing, the information-systems
function (generally called data processing) was placed in the
finance or accounting department of the organization. As
computing became more important, a separate information-
systems function was formed, but it still was generally placed
under the CFO and considered to be an administrative function
of the company. As the role of information technology
continued to increase, its place in the organization also moved
up the ladder. In many organizations today, the head of IT (the
CIO) reports directly to the CEO.

New Models of Organizations

The integration of information technology has influenced the
structure of organizations. The increased ability to communicate
and share information has led to a “flattening” of the
organizational structure due to the removal of one or more layers
of management. 
Another organizational change enabled by information
systems is the network-based organizational structure. In a
networked-based organizational structure, groups of employees
can work somewhat independently to accomplish a project. In a
networked organization, people with the right skills are brought
together for a project and then released to work on other projects
when that project is over. These groups are somewhat informal
and allow for all members of the group to maximize their
effectiveness.

Information-Systems Users – Types of Users

Besides the people who work to create, administer, and manage
information systems, there is one more extremely important
group of people: the users of information systems. This group
represents a very large percentage of the people involved. If the
user is not able to successfully learn and use an information
system, the system is doomed to failure.
Everett Rogers identified five specific types of technology
adopters:

 Innovators (Innovators are the first individuals to adopt a

new technology)
 Early adopters (The early adopters are those who
adopt innovation after a technology has been introduced
and proven)
 Early majority (Individuals in this category adopt an
innovation after a varying degree of time)
  Late majority (The late majority will adopt an innovation
after the average member of the society)
 Laggards (Individuals in this category are the last to adopt
an innovation)
These five types of users can be translated into information-
technology adopters as well, and provide additional insight into
how to implement new information systems within an
organization.

The Evolution and Role of Information

Systems
We basically need to turn our attention to the role that
information systems play in an organization. As technology has
developed, this role has evolved into the backbone of the
organization.

The Mainframe Era

From the late 1950s through the 1960s, computers were seen as
a way to more efficiently do calculations.  Only large
businesses, universities, and government agencies could afford
them, and they took a crew of specialized personnel and
specialized facilities to maintain. Typical functions included
scientific calculations and accounting, under the broader
umbrella of “data processing.”
In the late 1960s, the Manufacturing Resources
Planning (MRP) systems were introduced. This software,
running on a mainframe computer, gave companies the ability to
manage the manufacturing process, making it more efficient.
IBM became the dominant mainframe company. Nicknamed
“Big Blue,” the company became synonymous with business
computing. 

Client-Server
In the mid-1980s, businesses began to see the need to connect
their computers together as a way to collaborate and share
resources. This networking architecture was referred to as
“client-server” because users would log in to the local area
network (LAN) from their PC (the “client”) by connecting to a
powerful computer called a “server,” which would then grant
them rights to different resources on the network (such as shared
file areas and a printer). Software companies began developing
applications that allowed multiple users to access the same data
at the same time. This evolved into software applications for
communicating, with the first real popular use of electronic mail
appearing at this time.
The World Wide Web and E-Commerce
First invented in 1969, the Internet was confined to use by
universities, government agencies, and researchers for many
years. Its rather arcane commands and user applications made it
unsuitable for mainstream use in business. While the first e-mail
messages on the Internet were sent in the early 1970s,
companies who wanted to expand their LAN-based e-mail
started hooking up to the Internet in the 1980s. Companies
began connecting their internal networks to the Internet in order
to allow communication between their employees and
employees at other companies. It was with these early Internet
connections that the computer truly began to evolve from a
computational device to a communications device.
In 1989, Tim Berners-Lee developed a simpler way for
researchers to share information over the network at CERN
laboratories, a concept he called the World Wide Web. This
invention became the launching point of the growth of the
Internet as a way for businesses to share information about
themselves.

Making Decision: 
In an organization or business the managers need to make
decisions all the time. The decision must be backed by quality
judgment of the situation and its implications. Data collected,
compiled and presented in a simple way helps managers
understand the position of the organization and take appropriate
decisions. Information System (IS) helps in the decision-making
process by providing business intelligence which can be used to
analyze and understand the current trend, user habits and a lot
more.

Customer Interactions
Information system provides means to interact with the
customers that helps in customization of the services and
relationship building. Customers look for the platform where
they can provide feedback to the company, share about their
experiences with the organization and its products and find
assistance from the company in problem solving. Information
system makes it easier for the customers to reach to the
company through web-based front services and online self-
service.

Strategic Information System 

It applies information technology (IT) with the firm’s product,
service, and business process to help the organization to gain a
strategic advantage over the competition.

Knowledge Management System

 Knowledge Management system is a knowledge-based
information system to support creation. Organization and
dissemination business knowledge to employees and manager
throughout the company.

Operation Management: 
Information system is used to manage every day operation in an
organization such as employee monthly salary, taxes,
attendance, leave records, record income and expenses,
receivables, procuring goods and inventory management to
name a few. Daily tasks or operations management to keep
records or follow up on supplies, creditors, and inventory is
made easier with the help of IS.

System Types and Characteristics:-

Organizational information systems can be conveniently be
placed into the following categories:-
 Transaction Processing System (TPS) or Data Processing
System
 Management Information System (MIS)
 Executive Information System (EIS)
 Decision Support System (DSS)
 Transaction Processing System (TPS)
The system which these computer installations supported was
called data processing (DP) or transaction processing system
(TPS). Some example of TPS systems in typical organizations
are:-
 A payroll system
 A stock control system
 An order entry system

Bright Aspects of Information System

MIS facilitates planning
MIS improves the quality of plants by providing relevant
information for sound decision-making. Due to increase in the
size and complexity of organization, managers have lost
personal contact with the sense of operation.

It minimizes information overload

MIS change the larger amount of data into summarized form
and there by avoids the confusion which may arise when
managers are flooded with detailed facts.
It encourages decentralization
Decentralization of authority is possibly when there is a system
for monitoring operation at lower levels. MIS is successfully
used for measuring performance and making necessary change
in the organizational plans and procedures.

It brings co-ordination
MIS facilities integration of specialized activities by keeping
each department aware of the problem and requirements of other
department. It connects all decision centers in the organization.

Dark Aspects of Information System:-

Hacker activities have broadened beyond mere system intrusion
to include theft of goods and information, as well as system
damage and cyber vandalism, the intentional disruption,
defacement, or even destruction of a web-site or corporate
information system.
System malfunction if computer hardware breaks down, is not
configured properly, or is damaged by improper use or criminal
acts. Error in programming, improper installation, or
unauthorized changes cause computer software to fail. Power
failure, floods, fires, or other natural disaster can also disrupt
computer system.
Vulnerability has also increased from wide spread use of e-mail,
instant messaging (IM), and peer-to-peer file sharing programs.
E-mail may contain attachments that serve as springboards for
malicious software or unauthorized access to internal corporate
systems.

Management Information System

In business, management information systems (or information
management systems) are tools used to support processes,
operations, intelligence, and IT. MIS tools move data and
manage information. They are the core of the information
management discipline and are often considered the first
systems of the information age.
MIS produce data-driven reports that help businesses make the
right decisions at the right time. While MIS overlaps with other
business disciplines, there are some differences:
Enterprise Resource Planning (ERP)
This discipline ensures that all departmental systems are
integrated. MIS uses those connected systems to access data to
create reports. 
IT Management
This department oversees the installation and maintenance of
hardware and software that are parts of the MIS. The distinction
between the two has always been fuzzy.
E-commerce
 E-commerce activity provides data that the MIS uses. In turn,
the MIS reports based on this data affect e-commerce processes. 
Besides computer science, there are fields of study that
overlap with MIS, both at the theoretical and practical levels:
Information Technology (IT)
IT is similar to IS, but it focuses solely on computers.
Organizations worldwide rely on information technology to
create, store, exchange and process data. This industry includes
thousands of services and software programs that streamline
communication, improve customer retention and increase
security.
Communication Technology
From social media to email, smartphones, messenger apps and
team collaboration tools, there are endless examples of
communication technology.  Unified communication systems
integrate messaging, video conferencing, live chat and other
features to allow businesses to communicate effortlessly and
reduce infrastructure costs. Voice over Internet Protocol
(VoIP), one of the most widely used forms of technology in
business, makes communication over the Internet possible.
Users can call directly from their computers, hold conferences
remotely and multi-task without interruption.

Management Technology
Modern technology enables business executives and managers
to work more efficiently and make better decisions. Database
management systems, for instance, provide users with a
systematic way to retrieve, manage, update and create data.
This helps ensure that the information is consistently organized
and can be accessed whenever it's necessary. The latest systems
incorporate advanced features, such as activity auditing, data
recovery and automated rollbacks.
Customer Relationship Management (CRM) software has
emerged as one of the most popular types of technology for
business. CRM systems facilitate the processes that invoke
customer interactions with the sales and marketing teams
within an organization. Project management software allows
you to track the status of all projects in one place, identify risks
and share updates in real time.

Informatics
A discipline that combines software engineering, information
systems development, and networking. 

Electrical Engineering and Computer Engineering

These fields focus on the development and improvement of
hardware and software, respectively. MIS helps determine the
practical and theoretical implications of these changes. 
Categories of Management Information Systems
Management information system is a broad term that
incorporates many specialized systems. The major types of
systems include the following:
Executive Information System (EIS)
 Senior management use an EIS to make decisions that affect the
entire organization. Executives need high-level data with the
ability to drill down as necessary. 
Marketing Information System (MkIS)
Marketing teams use MkIS to report on the effectiveness of past
and current campaigns and use the lessons learned to plan future
campaigns.
Business Intelligence System (BIS)
Operations use a BIS to make business decisions based on the
collection, integration, and analysis of the collected data and
information. This system is similar to EIS, but both lower level
managers and executives use it. 
Customer Relationship Management System (CRM)
 A CRM system stores key information about customers,
including previous sales, contact information, and sales
opportunities. Marketing, customer service, sales, and business
development teams often use CRM.
Sales Force Automation System (SFA)
A specialized component of a CRM system that automates many
tasks that a sales team performs. It can include contact
management, lead tracking and generation, and order
management.
Transaction Processing System (TPS)
An MIS that completes a sale and manages related details. On a
basic level, a TPS could be a point of sale (POS) system, or a
system that allows a traveller to search for a hotel and include
room options, such as price range, the type and number of beds,
or a swimming pool, and then select and book it. Employees can
use the data created to report on usage trends and track sales
over time.
Knowledge Management System (KMS)
Customer service can use a KM system to answer questions and
troubleshoot problems. 
Financial Accounting System (FAS)
This MIS is specific to departments dealing with finances and
accounting, such as accounts payable (AP) and accounts
receivable (AR).
Human Resource Management System (HRMS)
This system tracks employee performance records and payroll
data.
Supply Chain Management System (SCM)
Manufacturing companies use SCM to track the flow of
resources, materials, and services from purchase until final
products are shipped.  

Benefits of Using Management Information Systems

 Using an MIS system can improve the performance of a
company in many ways.  Beyond the need to stay competitive,
there are some key advantages of effective use of management
information systems:
 Management can get an overview of their entire operation.
 Managers have the ability to get feedback about their
performance.
 Organizations can maximize benefits from their
investments by seeing what is working and what isn’t.
 Managers can compare results to planned performance by
identifying strengths and weakness in both the plan and the
performance.
 Companies can drive workflow improvements that result in
better alignment of business processes to customer needs.
 Many business decisions are moved out of upper
management to levels of the organization that is closer to
where the knowledge and experience lie.
  Maintain the integrity and security of IT services across
your remote teams with these templates
 Enable your IT teams to manage requests, track the status
of IT tickets, and execute on software deployments from
the field with helpful roll-up reports and centralized
dashboards, ensuring that all issues and tasks are collected,
resolved, and deployed while working remotely.

Management Information Systems in Healthcare

Organizations
MIS in healthcare enables data and information management
related to clinical trials, financial and legal information,
pharmaceutical details, physician credentials, and more, to be
handled within one comprehensive system. However, because
much of this information is confidential and must abide by
HIPAA regulatory requirements, these organizations must also
be confident that their MIS is safeguarded.
To enable healthcare teams to organize, manage, and store
critical information within one holistic system, while also
ensuring that their data is safe and all protected health
information (PHI) is secure, they need a tool that provides
transparency into critical processes, while remaining protected.
Artificial Intelligence 
Narrow AI (AI for specific tasks) is now pervasive in many
organizations. Advances in machine learning and deep learning
are making narrow AI much more valuable to all of us. Think
instantaneous translation, autonomous vehicles, robots, digital
manufacturing (3D printing), etc. MIS departments must try to
keep up with these advances and decide how narrow AI can be
used in their organizations. 

The Internet of Things (IoT) 

The rapid increase of placing sensors on all objects (animate and
inanimate) is leading to a sense-and-respond environment. MIS
employees should perform the SWOT analysis on IoT for their
organizations. A well-publicized example of IoT is General
Electric and its Predix operating system.

Block chain
 Distributed-ledger technology is now being used in a large
number of areas. Again, MIS employees must keep up with this
technology and see how it impacts their organizations. 
Financial Technology (FinTech)
If organization is in the financial sector, your MIS employees
had better be closely watching start-up FinTech companies.
These companies are planning on disrupting the traditional
financial sector.

Store and analyze information: 

Sophisticated and comprehensive databases, sometimes cloud-
based, are used to store and analyze information pertaining to
business functions, customers, transaction data, and both
employee and customer activity. The results of these analyses
provide insight that can help decision-makers solve current and
future issues.

Management Information Systems Capabilities

Managers of business departments that benefit from information
systems need to know the basic capabilities of information
technology, data analytics, and business intelligence systems.
Management information systems use all of these capabilities in
a way tailored to managerial and executive decision-making.
Information access
Managers need to have easy and fast access to information
including customer records, sales data, market research,
financial records, manufacturing and inventory data, and human
resources records to make informed decisions.

Data collection
Management information systems collect and collate data from
both outside and inside an organization. This data is pooled
together and housed in data warehouses, which are then
networked together for purposes of analytics.

Collaboration 
One of the most useful functions of information systems is the
ease by which different departments and distributed teams can
collaborate on decisions, taking into account massive amounts
of data from a number of different sources, departments, or even
industries.

Interpretation
 After a decision has been made, information systems can help
managers understand the potential implications of that decision
by constantly updating raw data and predicting possible future
benefits or problems.

Presentation 
Most information systems, especially those intended for use by
managers, include tools designed to create easy-to-understand
reports for review by higher-level managers or C-suite
executives.
Managers can also take advantage of information systems that
are specifically designed for business functions that affect their
department or position. Marketing information systems, product
subsystems, sales forecasting, and product design systems all
generate information that is invaluable to managers.
Improved Organizational Communication
An important use of technology in business is for
communication through platforms such as conferencing
software, email, video chat, company intranets and the internet
in general. IT allows businesses to easily hold virtual
meetings with staff and clients around the world without
having to spend time and money on travel. At the same time,
employees can access and share information and collaborate on
their work regardless of location; employees can even work
remotely so that the company can save on costs. Companies can
also use platforms such as social media to address customer
concerns more efficiently.

Better Customer Experience

IT also makes it easier to provide a good customer experience
through improved customer service, easier customized
marketing and e-commerce. Customers also benefit from being
able to purchase products and services from the company's
website, and this also increases the potential for more revenue
and growth for the company.
Increased Manufacturing Productivity
By automating business processes and giving employees ICT
tools, business can improve its individual and overall
productivity. Access to manufacturing data enables managers to
plan production more effectively, making better use of
resources and reducing lead times.

Improved Customer Service

Quality of customer service is an important differentiator for
businesses. Company can use ICT solutions to offer faster
response to and higher standards of service to its customers.

Greater and Virtual Collaboration

Communication networks enable your project teams to
collaborate effectively. By using videoconferencing or web
conferencing over the Internet, teams can hold virtual meetings
that bring together members from different locations, or
different organizations, such as suppliers or business partners.
This helps to create stronger project teams and enables the
teams to maintain progress on important projects, rather than
waiting for members to meet in a single location.
Information systems are only one of an almost infinite variety of
systems which may operate within an organization. It focus on
the use of Information and Communication Technologies (ICT)
in managing organizations. In the 21st century almost all
organizations use Information and Communication
Technologies to efficiently manage their operations, to help
managers make better decisions and achieve competitive
advantage, and to facilitate seamless internal and external
communications with their employees, customers, partners, and
other stakeholders.