There are various types of information systems,

for example: transaction processing systems,

decision support systems, knowledge
management systems, learning management
systems, database management systems, and
office information systems. Critical to most
information systems are information
technologies, which are typically designed to
enable humans to perform tasks for which the
human brain is not well suited, such as:
handling large amounts of information,
performing complex calculations, and
controlling many simultaneous processes.
Information technologies are a very important
and malleable resource available to executives.
[25]
Many companies have created a position of
chief information officer (CIO) that sits on the
executive board with the chief executive officer
(CEO), chief financial officer (CFO), chief
operating officer (COO), and chief technical
officer (CTO). The CTO may also serve as CIO,
and vice versa. The chief information security
officer (CISO) focuses on information security
management.
Information system - Wikipedia
Types[edit]

A four level hierarchy

The "classic" view of Information systems
found in textbooks[28] in the 1980s was a
pyramid of systems that reflected the hierarchy
of the organization, usually transaction
processing systems at the bottom of the
pyramid, followed by management information
systems, decision support systems, and ending
with executive information systems at the top.
Although the pyramid model remains useful
since it was first formulated, a number of new
technologies have been developed and new
categories of information systems have
emerged, some of which no longer fit easily into
the original pyramid model.
Some examples of such systems are:
 intelligent system
 computing platform
 data warehouses
 decision support system
 enterprise systems
 enterprise resource planning
 expert systems
 geographic information system
 global information system
 management information system
 multimedia information system
 process control system
 social information systems
 search engines
 office automation.
A computer(-based) information system is
essentially an IS using computer technology to
carry out some or all of its planned tasks. The
basic components of computer-based
information systems are:
 Hardware are the devices like the monitor,
processor, printer, and keyboard, all of
which work together to accept, process,
show data, and information.
 Software are the programs that allow the
hardware to process the data.
 Databases are the gathering of associated
files or tables containing related data.
 Networks are a connecting system that
allows diverse computers to distribute
resources.
 Procedures are the commands for
combining the components above to process
information and produce the preferred
output.
The first four components (hardware, software,
database, and network) make up what is known
as the information technology platform.
Information technology workers could then use
these components to create information systems
that watch over safety measures, risk and the
management of data. These actions are known
as information technology services.[29]
Certain information systems support parts of
organizations, others support entire
organizations, and still others, support groups of
organizations. Each department or functional
area within an organization has its own
collection of application programs or
information systems. These functional area
information systems (FAIS) are supporting
pillars for more general IS namely, business
intelligence systems and dashboards.[citation needed]
As the name suggests, each FAIS supports a
particular function within the organization, e.g.:
accounting IS, finance IS, production-operation
management (POM) IS, marketing IS, and
human resources IS. In finance and accounting,
managers use IT systems to forecast revenues
and business activity, to determine the best
sources and uses of funds, and to perform audits
to ensure that the organization is fundamentally
sound and that all financial reports and
documents are accurate.
Other types of organizational information
systems are FAIS, transaction processing
systems, enterprise resource planning, office
automation system, management information
system, decision support system, expert system,
executive dashboard, supply chain management
system, and electronic commerce system.
Dashboards are a special form of IS that support
all managers of the organization. They provide
rapid access to timely information and direct
access to structured information in the form of
reports. Expert systems attempt to duplicate the
work of human experts by applying reasoning
capabilities, knowledge, and expertise within a
specific domain.
Types of information systems
structure of organizational information systems
Information systems support operations,
knowledge work, and management in
organizations. (The overall structure of
organizational information systems is
shown in the figure.) Functional
information systems that support a specific
organizational function, such as marketing
or production, have been supplanted in
many cases by cross-functional systems
built to support complete business
processes, such as order processing or
employee management. Such systems can
be more effective in the development and
delivery of the firm’s products and can be
evaluated more closely with respect to the
business outcomes. The information-system
categories described here may
be implemented with a great variety of
application programs.
Operational support and enterprise systems
Transaction processing systems support the
operations through which products are
designed, marketed, produced, and
delivered. In larger organizations,
transaction processing is frequently
accomplished with large integrated systems
known as enterprise systems. In this case,
the information systems that support
various functional units—sales and
marketing, production, finance, and human
resources—are integrated into an enterprise
resource planning (ERP) system, the
principal kind of enterprise system. ERP
systems support the value chain—that is,
the entire sequence of activities or
processes through which a firm adds value
to its products. For example, an individual
or another business may submit a custom
order over the Web that automatically
initiates just-in-time production to the
customer’s specifications through an
approach known as mass customization.
This involves sending orders from the
customers to the firm’s warehouses and
perhaps to suppliers to deliver input
materials just in time for a batched custom
production run. Financial accounts are
updated accordingly, and
delivery logistics and billing are initiated.
Along with helping to integrate a firm’s own
value chain, transaction processing systems
can also serve to integrate the overall supply
chain of which the organization is a part.
This includes all firms involved in
designing, producing, marketing, and
delivering the goods and services—from raw
materials to the final delivery of the
product. A supply chain management
(SCM) system manages the flow of
products, data, money, and information
throughout the entire supply chain, which
starts with the suppliers of raw materials,
runs through the intermediate tiers of the
processing companies, and ends with the
distributors and retailers. For example,
purchasing an item at a major retail store
generates more than a cash register receipt:
it also automatically sends a restocking
order to the appropriate supplier, which in
turn may call for orders to the supplier’s
suppliers. With an SCM system, suppliers
can also access a retailer’s
inventory database over the Web to
schedule efficient and timely deliveries in
appropriate quantities.
The third type of enterprise
system, customer relationship management
(CRM), supports dealing with the
company’s customers in marketing, sales,
service, and new product development. A
CRM system gives a business a unified view
of each customer and its dealings with that
customer, enabling a consistent
and proactive relationship. In
cocreation initiatives, the customers may be
involved in the development of the
company’s new products.
Many transaction processing systems
support electronic commerce over
the Internet. Among these are systems for
online shopping, banking, and securities
trading. Other systems deliver information,
educational services, and entertainment on
demand. Yet other systems serve to support
the search for products with desired
attributes (for example, keyword search on
search engines), price discovery (via an
auction, for example), and delivery of
digital products (such as software, music,
movies, or greeting cards). Social network
sites, such as Facebook and LinkedIn, are a
powerful tool for supporting
customer communities and individuals as
they articulate opinions, evolve new ideas,
and are exposed to promotional messages.
A growing array of specialized services and
information-based products are offered by
various organizations on the Web, as
an infrastructure for electronic commerce
has emerged on a global scale.
Transaction processing systems accumulate
the data in databases and data warehouses
that are necessary for the higher-level
information systems. Enterprise systems
also provide software modules needed to
perform many of these higher-level
functions.
Information system - Operational support and
enterprise systems | Britannica

Six Major Types of Information Systems

Now that we have dealt with the basics, let's

look at the six primary types of information
systems. Although information systems are not
limited to this list, typical businesses and
organizations have the following six, each
system supporting a different organizational
level.

For starters, we have a the operational level.

Next are the office automation systems (OAS)
and knowledge work systems (KWS), both
working at the knowledge level. Next, the
management level has the management
information systems (MIS) and decision support
systems (DSS), and we conclude with the
executive support systems (ESS) at the strategic
level.

Let’s explore the different types of information

systems more in-depth.

 Transaction Processing System (TPS)

Transaction processing is essential to helping
businesses perform daily operations.
Transactions are defined as any activity or
event that affects the company, and include
things like deposits, withdrawals, shipping,
billing customers, order entry, and placing
orders. TPS supports these business
transactions.

 Office Automation System (OAS)

OAS consists of computers, communication-
related technology, and the personnel assigned
to perform the official tasks. The OAS covers
office transactions and supports official activity
at every level in the organization. The official
activities are subdivided into managerial and
clerical activities.

Office automation systems include the

following applications:

 Email: The email application also covers file

attachments such as audio, video, and
documents.
 Voice Mail: This application records and
stores phone messages into the system’s
memory and can be retrieved anytime.
 Word Processing: Word processing covers the
creation of documents, including memos,
reports, letters, and anything else that’s
printable electronically. The created text can
be copied, edited, and stored via word
 processing commands, and checked for
grammar and spelling, line and word
counting, and headers and footers.
 Knowledge Work System (KWS)
The KWS is a specialized system that expedites
knowledge creation and ensures that the
business's technical skills and knowledge are
correctly applied. The Knowledge Work System
aids workers in creating and disseminating new
information using graphics, communication,
and document management tools. Here are
some examples of KWS:

 Computer-Aided Design Systems (CAD): CAD

systems automate design creation and
revision via computers and graphics software,
especially in the manufacturing and tooling
processes.
 Financial Workstations: These systems pull
and combine data from many different
internal and external sources, covering
 research reports, market data, and
management data. Financial workstations can
rapidly analyze huge amounts of financial
data and trading situations.
 Virtual Reality Systems: These systems take
the CAD system to the next level, using
interactive graphics utilities to create realistic
computer-generated simulations. VR systems
are typically found in scientific, educational,
and business circles.
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 Management Information System (MIS)

Middle managers handle much of the
administrative chores for day-to-day routines
and performance monitoring, ensuring that all
the work is aligned with the organization's
needs. That's why MIS is such a valuable tool.
Management Information Systems are specially
designed to help middle managers and
supervisors make decisions, plan, and control
the workflow. The MIS pulls transactional data
from various Transactional Processing Systems,
compiles the information, and presents it in
reports and displays.

Additionally, these reports can be produced

monthly, quarterly, or annually, although MIS
can have more immediate reports (e.g., hourly,
daily).

 Decision Support System (DSS)

The DSS is a management-level, interactive
computer-based information system that helps
managers to make decisions. The Decision
Support System specifically gives middle
managers the information necessary to make
informed, intelligent decisions.
Decision Support Systems use different decision
models to analyze or summarize large pieces of
data into an easy-to-use form that makes it
easier for managers to compare and analyze
information. Often, these summaries come in
the form of charts and tables.

 Executive Support System (ESS)

 The ESS is like the MIS but for executive-level
decision-making.  The decisions involve
company-wide matters, so the stakes are
higher. Consequently, they demand more
insight and judgment.
The ESS provides greater telecommunication,
better computing capabilities, and more
efficient display options than the DSS.
Executives use ESS to make effective decisions
through summarized internal data taken from
DSS and MIS and external sources. In addition,
executive support systems help monitor
performances, track competitors, spot
opportunities, and forecast future trends.

prevNext

The 6 Types of Information Systems and their

Applications | Simplilearn

Techopedia Explains Information

System (IS)
There are several types of information
systems, including the following
common types:
 Operations support systems,
including transaction processing
systems.
 Management information systems.
 Decision support systems.
  Executive information systems.
An information system commonly
refers to a basic computer system but
may also describe a telephone
switching or environmental controlling
system.
The IS involves resources for shared
or processed information, as well as
the people who manage the system.
People are considered part of the
system because without them,
systems would not operate correctly.
IT professionals, programmers,
system analysts, high-level managers,
and help-desk workers are all part of
an IS.
An "information systems triangle" is
often used to explain how an IS
consists of hardware components
(such as computers), people and
processes at the three vertices.
There are many types of information
systems, depending on the need they
are designed to fill. An operations
support system, such as a transaction
processing system, converts business
data (financial transactions) into
valuable information. Similarly, a
management information system uses
database information to output
reports, helping users and businesses
make decisions based on extracted
data.
In a decision support system, data is
pulled from various sources and then
reviewed by managers, who make
determinations based on the compiled
data. An executive information system
is useful for examining business
trends, allowing users to quickly
access custom strategic information in
summary form, which can be
reviewed in more detail.
Examples of IS
Some popular TV shows can be
actually considered as an amazing
and unexpected example of IS. In
talent shows, the TV audience is
asked to cast their vote to determine
which candidates will advance to the
next stage of the show.
The system that captures the votes
and records them is the hardware
computer, the steps through which
these votes are cast (phone call, text,
or online poll) and the rules that
determine who is eliminated are the
process, and the voters are the people
involved with the system.
The census tabulator invented by
Herman Hollerith in 1890 to automate
the tabulation work of the U.S. census
is considered the first large-scale
mechanical information system.
RELATED QUESTION

What is an Information System? - Definition

from Techopedia

There are primarily 6 types of information

systems that businesses incorporate in their
operations in varying capacities.
Transaction Processing System

A transaction process system (TPS) is used

to collect, modify and retrieve business
transactions on demand.

Any running business conducts several

transactions at any given point in time.
These business transactions do not
conform to just buying and selling of
products but also include deposits in banks,
inventory counts, payment data about the
newly employed, etc. A transaction
processing system handles these
transactions.

Another purpose of a transaction

processing system is that it can be
employed to update a business’s
transaction records. It can then
conveniently store the whole collection of
records to produce business reports.
Transaction processing systems also find
uses as payroll systems, stock control
systems, and billing systems.

Using a Transaction processing system, a

business can safely meet all its contractual
requirements. It can also store customer
information in a secure location and provide
access to it as and when required to the
concerned authority. 

One of the primary benefits of using a

transaction processing system is its ability
to maintain a stable database from which
data can be retrieved easily.

Moreover, the TPS can process volumes of

data in realtime. The system does this in
batches to better manage the processing
time. Therefore, it can be derived that TPS
is also responsible for providing premium
customer experience and satisfaction.
Using an efficient TPS allows a business to
build cordial and reliable relationships with
other businesses and customers because
of its availability around the world,
regardless of the location and language. 

Management Information System

A Management Information System (MIS)

studies the people, technology,
organization, and the relationships between
them. 

Management Information Systems can

provide the most suitable information that
can be used by an institution’s
management to deduce investment
strategies. These systems emphasize
service through technology and therefore,
data analysis, project management is at
their very core.
The various types of management
information systems can produce reports
for specific 

business needs. Some examples of these

reports include summary reports, ad-hoc
reports, execution reports, etc.

Management information systems can also

be designed specifically for the Human
Resources, Sales or any other suitable
department of a business.

The management information system, due

to its ability to deliver factual reports with
ease and speed makes a business
competent enough to confidently handle
sudden market changes.

Another benefit of this type of information

system is that it allows the business player 

including the staff and managers to analyze

the reports on their end. Post-analysing, 
businesses can set their short long-term
goals and prioritize them accordingly.

Management information systems can also

help businesses beat the competition by
levelling up their ability to match
competitive challenges in the market.
Analyzing huge amounts of data helps in
devising plans to beat the competition and
capture the market.

Decision Support Systems

A Decision Support System is an interactive

information system that assists a business
in making decisions for the management. It
does this by storing and analyzing the
business data to help the business take the
appropriate action.

Decision support systems are interactive

which means they readily offer information
and tools for the manipulation of data. An
example of such a system would be the
interactive maps we use on our
smartphones while travelling. These maps
show us which routes are the fastest to
traverse along with the appropriate mode of
transportation for the journey.

DSS helps in visualizing the data and

makes it’s understanding faster and easier.
This ultimately bolsters the management’s
ability to make effective decisions at a
much faster pace.

Due to the interactive nature of DSS,

management can add/delete data and
observe the effect corresponding to it.

This way decision-making is simplified and

a company can meet its target sans any
hassle.
Expert System

This information system is a sophisticated

computer-based system that helps in
representing knowledge in the form of data
mainly executed by computer programs.
Expert systems, keeping in line with their
name, are designed such that they mimic
human intelligence, particularly reasoning
to an extent.

As such, an expert system offers the

necessary expertise that is utilized by the
management to identify, predict or capture
the problems. 

Furthermore, this type of information

system can be used to assist problem-
solving since it incorporates the working of
artificial intelligence. To better understand
the concept behind an expert system, think
of it as an expert in specific business areas
who is acting as a consultant.
The core components of an Expert System
are its knowledge repository, a search
apparatus, an information gathering system
and a display interface that allows users to
interact with its outputs. The inbuilt software
that administers the system makes
deductions by acquiring information from
the knowledge repository and answering
the queries posed by users through the
interface.

Another benefit of the Expert System is that

human knowledge is completely captured in
a computer and it is used to solve
problems. 

This makes the Expert System accessible

to amateurs and staff lacking expertise to
groom their problem-solving skills.
Office Automation System

Office Automation Systems offer a way for

data to move from one system to another
without any manual work or human
intervention.

In the digital age, office automation systems

facilitate data transportation by bundling
huge amounts of data in an ordered
manner and shipping them. The lack of
manual efforts makes OAS a technique that
mitigates errors, speeds up business
processes and ensures their reliability.

The OAS also makes certain that every

process activity is visible to the
management. Thanks to this, businesses
can actively figure out and eliminate any
bottlenecks associated with a business
process. 
The automation in OAS makes it possible to
look at the data processing path. Using this,
businesses can stay updated with tasks
and predict future data processing.

OAS can be utilized daily in printing

documents, automating emails, and
enhancing communication within an
organization.

Knowledge Management Systems

A knowledge management system is a type

of information system that stores
information for building knowledge for
users. This can help in achieving
collaboration between different
departments.

Companies make use of Knowledge

Management Systems to properly organize
the documentation, FAQs, and other such
information concerning them. The KMS also
makes all the documented company
information easily accessible to its staff and
customers, albeit in specified degrees.

Documents such as business policies,

training material, and generic customer
queries can be assembled in one place and
be accessed at all times. 

A KMS ensures that the business-specific

abilities of the staff are integrated
throughout the organization and helps
employees to understand the available
information better. 

All the collected information from outside,

such as the competitor’s market share or
services,  the organization can be stored as
well. This information can then be
communicated 

within the business and be used to design

goals accordingly.
Conclusion

The different types of Information systems

mentioned above might seem overlapping,
but in their true essence, each handles a
unique aspect of a business. If used to their
utmost extent, these systems can render
business communication easier and
departmental coordination can be
enhanced.

A growing business opens doors to a lot of

information and one must ensure that it is
effectively processed to make key
advancements. Thus, knowing which
information systems to install is crucial for
businesses and organisations alike.

The 6 Main Types of Information Systems -

InterviewBit
The 6 Most Popular Types of Information
Systems and Their Applications
By Simplilearn
Last updated on Nov 11, 202280231

Table of Contents

Information Systems Defined

Six Major Types of Information Systems
What Are the Main Applications of
Information Technology?
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Information has become one of the primary
factors in business success. We’re living in
the Information Age, and those with the
best, most current, most accurate
information will win the day. Knowledge is
power, and data information is just another
example of that power.

However, it’s not enough to have vast

amounts of good information; businesses
and organizations need to have the best
types of information systems to work with
that information and produce the best
outcomes. That’s why, in today’s data-heavy
world, organizations need a solid
information system.

So today, we’re covering six different types

of information systems and how they’re
applied.
We’ll begin with the fundamentals, namely
“what is an information system?”

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Information Systems Defined

Information systems are collections of

multiple information resources (e.g.,
software, hardware, computer system
connections, the system housing, system
users, and computer system information) to
gather, process, store, and disseminate
information.
Tools such as laptops, databases,
networks, and smartphones are examples
of information systems. So yes, as you read
this article, you’re employing an information
system! Many people rely on various types
of information systems to communicate
with friends and family, bank or shop online,
or look up information via a search engine.

Companies and organizations employ

information systems to communicate and
work with their customers and suppliers,
manage the organization, perform essential
business operations, and roll out and
maintain marketing campaigns.

Six Major Types of Information Systems

Now that we have dealt with the basics,

let's look at the six primary types of
information systems. Although information
systems are not limited to this list, typical
businesses and organizations have the
following six, each system supporting a
different organizational level.

For starters, we have the transaction

processing systems (TPS) at the
operational level. Next are the office
automation systems (OAS) and knowledge
work systems (KWS), both working at the
knowledge level. Next, the management
level has the management information
systems (MIS) and decision support
systems (DSS), and we conclude with the
executive support systems (ESS) at the
strategic level.

Let’s explore the different types of

information systems more in-depth.
 Transaction Processing System (TPS)

Transaction processing is essential to

helping businesses perform daily
operations. Transactions are defined as any
activity or event that affects the company,
and include things like deposits,
withdrawals, shipping, billing customers,
order entry, and placing orders. TPS
supports these business transactions.

 Office Automation System (OAS)

OAS consists of computers,

communication-related technology, and the
personnel assigned to perform the official
tasks. The OAS covers office transactions
and supports official activity at every level
in the organization. The official activities
are subdivided into managerial and clerical
activities.
Office automation systems include the
following applications:

 Email: The email application also covers

file attachments such as audio, video, and
documents.
 Voice Mail: This application records and
stores phone messages into the system’s
memory and can be retrieved anytime.
 Word Processing: Word processing covers
the creation of documents, including
memos, reports, letters, and anything else
that’s printable electronically. The created
text can be copied, edited, and stored via
word processing commands, and checked
for grammar and spelling, line and word
counting, and headers and footers.

 Knowledge Work System (KWS)

The KWS is a specialized system that
expedites knowledge creation and ensures
that the business's technical skills and
knowledge are correctly applied. The
Knowledge Work System aids workers in
creating and disseminating new
information using graphics,
communication, and document
management tools. Here are some
examples of KWS:

 Computer-Aided Design Systems

(CAD): CAD systems automate design
creation and revision via computers and
graphics software, especially in the
manufacturing and tooling processes.
 Financial Workstations: These systems
pull and combine data from many
different internal and external sources,
covering research reports, market data,
 and management data. Financial
workstations can rapidly analyze huge
amounts of financial data and trading
situations.
 Virtual Reality Systems: These systems
take the CAD system to the next level,
using interactive graphics utilities to
create realistic computer-generated
simulations. VR systems are typically
found in scientific, educational, and
business circles.
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 Management Information System (MIS)

Middle managers handle much of the
administrative chores for day-to-day
routines and performance monitoring,
ensuring that all the work is aligned with the
organization's needs. That's why MIS is
such a valuable tool. Management
Information Systems are specially designed
to help middle managers and supervisors
make decisions, plan, and control the
workflow. The MIS pulls transactional data
from various Transactional Processing
Systems, compiles the information, and
presents it in reports and displays.

Additionally, these reports can be produced

monthly, quarterly, or annually, although
MIS can have more immediate reports (e.g.,
hourly, daily).

 Decision Support System (DSS)

The DSS is a management-level, interactive
computer-based information system that
helps managers to make decisions. The
Decision Support System specifically gives
middle managers the information
necessary to make informed, intelligent
decisions.

Decision Support Systems use different

decision models to analyze or summarize
large pieces of data into an easy-to-use
form that makes it easier for managers to
compare and analyze information. Often,
these summaries come in the form of
charts and tables.

 Executive Support System (ESS)

 The ESS is like the MIS but for executive-

level decision-making.  The decisions
involve company-wide matters, so the
 stakes are higher. Consequently, they
demand more insight and judgment.
The ESS provides greater
telecommunication, better computing
capabilities, and more efficient display
options than the DSS. Executives use ESS
to make effective decisions through
summarized internal data taken from DSS
and MIS and external sources. In addition,
executive support systems help monitor
performances, track competitors, spot
opportunities, and forecast future trends.

The 6 Types of Information Systems and their

Applications | Simplilearn
Major Types of Information Systems
A typical organization has six information
systems with each supporting a specific
organizational level. These systems include
transaction processing systems (TPS) at the
operational level, office automation systems
(OAS) and knowledge work systems (KWS)
at the knowledge level, management
information systems (MIS) and decision
support Systems (DSS) at the management
level and the executive support systems
(ESS)at the strategic level.
 Contents [show]
1. Transaction Processing Systems
Every firm needs to process transactions in
order to perform its daily business
operations. A transaction refers to any event
or activity that affects the organization.
Depending on the organization’s business,
transactions may differ from one
organization to another. In a manufacturing
unit, for example, transactions include order
entry, receipt of goods, shipping, etc., while
in a bank, transactions include deposits and
withdrawals, cashing of cheques, etc.

However, some transactions, including

placing orders, billing customers, hiring
employees, employee record keeping, etc.,
are common to all organizations. To
support the processing of business
transactions, transaction processing systems
(TPS) are used in organizations.

2. Office Automation Systems

An office automation system (OAS) is a
collection of communication technology,
computers, and persons to perform official
tasks. It executes office transactions and
supports official activities at every
organizational level. These activities can be
divided into clerical and managerial
activities.

Clerical activities performed with the help of

an office automation system include
preparing written communication,
typesetting, printing, mailing, scheduling
meetings, calendar keeping. etc. Under
managerial activities, an office automation
system helps in conferencing, creating
reports and messages, and controlling the
performance of the organization. Many
applications like word processing, electronic
filing, and e-mail are integrated into office
automation systems.

 Word Processing

Word processing is used for the preparation

of documents like letters, reports, memos,
or any type of printable material by
electronic means. The text is entered by the
keyboard and displayed on the computer’s
display unit.

This text can be edited, stored, and

reproduced with the help of commands
present in the word processor. Word
processors have facilities for spell checking,
grammar checking, counting (character,
lines, pages, etc.), automatic page
numbering, index creation, header, and
footer, etc.

See also  Committee Organizational

Structure. 9 Advantages and
Disadvantages of Committees

 Email
E-mail or electronic mail facilitates the
transfer of messages or documents with the
help of computers and communication
lines. This helps in the speedy delivery of
mails and also reduces the time and cost of
sending paper mail. E-mail supports not
only the transfer of text messages but also
has options for sending images, audio,
video, and many other types of data.

Voice Mail

Voice mail, an important call service, allows

the recording and storing of telephone
messages into the computer’s memory. The
intended person can retrieve these
messages at any time.

3. Knowledge Work Systems

A knowledge work system (KWS) is a
specialized system built to promote the
creation of knowledge and to make sure
that knowledge and technical skills are
proper integrated into the business. It helps
the knowledge workers in creating and
propagating new information and
knowledge by providing them the graphics,
analytical, communications, and document
management tools.

The knowledge workers also need to search

for knowledge outside the organization.
Thus, the knowledge work system must give
easy access to external databases. In
addition, knowledge work systems should
have a user-friendly interface to help users
to get the required information quickly and
easily.

Some examples of knowledge work systems

are computer-aided design (CAD)systems,
virtual reality systems, and financial
workstations.

Computer-aided design (CAD)

systems: These systems are used for
automating the creation and revision of
designs using computers and graphics
software. The CAD software has the
capability to provide design specifications
for the tooling and manufacturing process.
This saves much time and money while
making a manufacturing process.

Virtual Reality System: These systems

have more capabilities than CAD systems
for visualization, rendering, and simulation.
They make use of interactive graphics
software to build computer-generated
simulations which almost look real. They
can be used in educational, scientific, and
business work.
See also  Advantages and Disadvantages
of Bureaucracy

Financial Workstations: They are used to

combine a wide range of data from internal
as well as external sources. This data
includes contact management data, market
data, and research reports. Financial
workstations help in analyzing trading
situations and large amounts of financial
data within no time. It is also used
for portfolio management.

4. Management Information Systems

Management information systems are
specially developed to support the
planning, controlling, and decision-making
functions of middle managers. A
management information system (MIS)
extracts transaction data from underlying
TPSs, compiles them, and produces
information products in the form of reports,
displays, or responses.

These information products provide

information that conforms to the decision-
making needs of managers and supervisors.
Management information systems use
simple routines like summaries and
comparisons which enable managers to
take decisions for which the procedure of
reaching a solution has been specified in
advance.

Generally, the format of reports produced

by MIS is pre-specified. A typical MIS report
is a summary report, such as a report on the
quarterly sales made by each sales
representative of the organization.
Another type of management information
system report is an; for example, exception
report that specifies the exception
conditions the sales made by some sales
representative is far below than expected.

Usually, management information systems

are used to produce reports on a monthly,
quarterly, or yearly basis. However, if
managers want to view the daily or hourly
data, MIS enables them to do so. In
addition, they provide managers online
access to the current performance as well as
past records of the organization.

5. Decision Support Systems

A decision support system (DSS) is an
interactive computer-based information
system that, like MIS, also serves at the
management level of an organization.
However, in contrast to MIS, it processes
information to support the decision-making
process of managers.

It provides middle managers with the

information that enables them to make
intelligent decisions. A decision support
system in a bank, for example, enables a
manager to analyze the changing trends in
deposits and loans in order to ascertain the
yearly targets.

See also  Understanding Organizational

Culture
Decision support systems are designed for
every manager to execute a specific
managerial task or problem. Generally, they
help managers to make semi-structured
decisions, the solution to which can be
arrived at logically. However, sometimes,
they can also help in making complex
decisions. To support such decisions, they
use the information generated by OASs and
TPSs.

Decision support systems have more

analytical power as compared to other
information systems. They employ a wide
variety of decision models to analyze data
or summarize a vast amount of data into a
form (usually the form of tables or charts)
that makes the comparison and analysis of
data easier for managers.

They provide an interactive environment so

that the users could work with them
directly, add or change data as per their
requirements, and ask new questions.

6. Executive Support Systems

An executive support system (ESS) – an
extension of MIS – is a computer-based
information system that helps in decision-
making at the top level of an organization.
The decisions taken with the help of an
executive support system are non-routine
decisions that affect the entire organization
and, thus, require judgment and sight.

As compared to DSSs, ESSs offer more

general computing capabilities, better
telecommunications, and efficient display
options. They use advanced graphics
software to display critical information in
the form of charts or graphs that help
senior executives to solve a wide range of
problems.

To make effective decisions, they use

summarized internal data from MIS and
DSS as well as data from external sources
about events like new tax laws, new
competitors, etc. They filter, compress, and
track data of high importance and make it
available to the strategic-level managers.

Executive support systems help to monitor

performance, track activities of competitors,
identify opportunities, and forecast trends.
They also assist senior managers in
answering the following question:

• What business should we do?

• How are our competitors doing the

business?

• Which units can be sold and which new

units are to be bought?
https://www.managementstudyhq.com/six-
major-types-of-information-systems.html
Imagine working for a large coffee shop
chain. From the number of orders taken per
day at one store to the overall company’s
quarterly performance, data must be processed
and analyzed at all levels of the organization
for managers to make sound decisions. If
you’re a store manager, inventory information
may be what you need to decide what product
to order more of. As a chief executive, having
an overall picture of the company
performance could be the information you
require to evaluate diversification strategies.
How can this information be stored and
classified so that you can make the decisions
you need to as a manager?
The Pyramid Model for Classifying Information
One of the most widely-used systems for
classifying different information systems  is
known as the pyramid model. The pyramid
model classifies information based on the
tasks and responsibilities that are found in a
hierarchical organization. Think of a
hierarchical organization as a pyramid that
can be divided into three levels: operational
level, middle management level and
executive, or senior, level.
Managers residing at these three levels have
different information needs and
consequently utilize information systems
that satisfy their specific information needs.
Within these three levels are five types of
information systems.
Operational Level
Operations managers  run the day-to-day
business operations and make routine
decisions such as a coffee shop manager
wanting to know whether to order more
coffee or not for next week. Transaction
processing systems and process control
systems are two types of information
systems used at the operational level.
1.     Transaction Processing System
Operational managers use transaction
processing systems that can track and
capture automated or semi-automated
transactions between an employee and a
customer, an employee and a supplier, or
even between two employees of different
departments within the same organization.
The main job of a transaction processing
system is to validate, sort, merge, calculate
and update data from these transactional
events and produce summary reports or lists
from which decisions can be made.
Examples of transaction processing systems
include:
 Payroll systems
 Order processing systems
 Reservation systems
 Systems for payments and fund transfers
2.     Process Control Systems
Another kind of system that can be used at
the operational level are process control
systems. Process control systems are used to
monitor and control physical processes. An
example would be to test the temperature of
food as it’s being prepared. Unlike
transaction processing systems, process
control systems take their input data from
sensors to generate reports that are analyzed
by an operational manager to adjust the
business process.
Examples of process control systems
include:
 Assembly lines
 Petroleum refineries
Middle Management Level
Middle-level managers make tactical
decisions that assist in implementing the
strategy of the organization. Tactical
decisions involve decisions related to
developing divisional plans, structuring
workflows, establishing distribution
channels and acquisition of resources, such
as personnel, materials and money. For the
coffee shop example, a tactical decision
would be whether to open earlier in the
morning or on the weekends to attract new
customers. Two types of information
systems that can be used by middle-level
managers are management information
systems and decision support systems.
3.     Management Information Systems
Management information systems  are built
on data provided by transaction processing
systems. They extract their data from
databases located in different departments to
compile reports such as sales analysis,
inventory level reports, or financial
statements. They typically have little or no
analytical capability and are used to provide
reports on the firm’s past or current
performance rather than the future
performance of an organization.
Examples of management information
systems include
 Sales management systems
 Inventory control systems
 Budgeting systems
 Human resource management systems
4.     Decision Support Systems
Decision support systems, on the other hand,
are interactive systems that can be seen to
solve ill-structured or semi-structured
problems. An example of an ill-structured
problem for the coffee shop would be
whether to open a new coffee shop at
another location. Decision support systems
have analytical and/or modeling capabilities
to analyze existing structured information
and they allow managers to project the
potential effects of their decisions into the
future. They may also support the exchange
of information within the organization, so
they are also classified as knowledge
management systems.
Examples of decision support systems
include
 Group decision support systems
 Computer-supported cooperative work
systems
 Logistics systems
 Financial planning systems
Executive Level
The top-most level is the senior executive
level, also known as the C-suite level
because management at this level is
comprised of CEOs, COOs, CIOs, CFOs, etc.
The C-suite makes strategic decisions that
affect and shape the future survivability of
an organization. An example of a strategic
decision for the coffee shop would be to
decide whether to remain in the café
business or not. Long-term forecasts of
business turnover set against likely market
conditions can help the senior management
of the coffee shop determine whether they
should close the café business or not.
5.     Executive Information Systems
Executive information systems help
executives and other senior managers
analyze the environment in which the
organization operates to identify long-term
trends and to plan appropriate courses of
action. The information in such a system is
often weakly structured and comes from both
internal sources, such as its own databases or
data warehouse, and external sources, such
as data from customers, suppliers, or other
governmental databases.
Executive information systems tend to be
highly individualized and are often custom-
made for a particular client group. However,
many off-the-shelf executive information
systems packages do exist. And many
enterprise-level systems offer a customizable
executive information system module. An
easy to use digital dashboard with a real-
time view of the performance of an
organization is a common feature of an
executive information system.
Information systems are one of the many
industry topics explored in Florida
Tech’s information technology degree
programs . Learn more about these
programs here .

What Are the 5 Types of Information Systems?

(floridatechonline.com)

A BRIEF HISTORY OF E-WALLET

29th November 2022
Digital wallet features have come a long
way since its inception. Many people aren’t
aware that the popular innovation has quite
a rich history filled with various
developments, caveats, and various
improvements over time.
Nowadays, a user can hold funds for
upcoming online transactions in an e-wallet,
as a kind of pre-paid account. A password
is required to access an e-wallet, which
leads to tighter security. Paying for
groceries, internet purchases, and plane
tickets, among other things, can also be
accomplished with the use of an e-wallet.
However, the journey to this form of
optimised efficiency was not easy or
straight forward. To give you an idea of just
how extensive the developmental process
was, here’s a brief breakdown of the
notable highlights throughout the history of
the digital wallet.

Digital payments in the 90s

Sting's "Ten Summoner’s Talesis" CD

(1994)
Prior to accepting credit card payments, the
majority of payments made through online
marketplaces were made by sending
cheques or through other direct
transactions between the buyer and seller
without the involvement of a payment
processor.
For both parties, this was a very time-
consuming process that involved frequent
email correspondence. The payment
procedure could take up to 10 days to
complete, not to mention the obvious
security risks associated with disclosing
consumer payment information.
In 1994, the first secure online transaction
was completed. A studio album entitled ‘A
Ten Summoner's Tales’ by Sting in CD
format was purchased from the internet
store, NetMarket. This was the first online
transaction using encryption software to
ensure that clients' personal data was
private. In 1995, the payment technique
paved the way for impending online
marketplace purchases on sites like
Amazon and eBay.
Initial online payment systems weren't at all
user-friendly and required in-depth
understanding of data transfer protocols or
encryption.
Only PayPal (initially named Confinity)
made low cost, simple digital payments
possible in 1999. The founders' concept
was straightforward and effective: get
clients to provide their email addresses,
banking, and credit card numbers in
exchange for quick and inexpensive
payments.

Coca-Cola (1997, Helsinki)

The world's first digital payment system is
ascribed to Coca-Cola for introducing
numerous vending machines in Helsinki in
1997. Customers could pay for their soft
drinks via text message on their mobile
phones thanks to digital payment
processing technology developed by the
multinational soft drink company.

PayPal (1999)
In reality, when technology entrepreneurs
Max Levchin and Peter Thiel launched
PayPal in 1998, it wasn't even given that
name (the company’s original name was
Confinity).
As the internet tightened its grip on
customers worldwide, the corporation
cleverly targeted an underdeveloped
market: banking and payments.
The founders' concept was straightforward
and effective: in exchange for quick,
inexpensive payments, they persuaded
customers to provide their email addresses,
banking, and credit card information.
Within three years of becoming operational,
the company handled more than $3 billion
in payments from 10.2 million individual
consumers and 2.6 million business clients.
Small businesses, internet retailers, and
consumers all rapidly signed up.
After deciding to concentrate solely on
payments made over the rapidly developing
internet, the founders of the company
changed the name of their business to
PayPal within two years. As no one was
truly concentrating on a digital payment
platform between customers and
businesses at the beginning of the new
century, Thiel and Levchin had skillfully
exploited an opening in the payments
sector.

Digital payments in the 00s

Alipay (2003, China)

Taobao was introduced as an online
shopping platform in 2003 by Alipay. In
June 2010, the People's Bank of China,
China's central bank, released licensing
guidelines for third-party payment
providers.
Additionally, it released distinct
requirements for payment institutions with
foreign funding. In order to expedite the
regulatory clearance for the license, Alipay,
which made up half of China's non-bank
online payment business, was reorganised
as a domestic company under the
management of Alibaba CEO, Jack Ma.
The 2011 media allegations that Yahoo!
and Softbank (the main shareholders of
Alibaba Group) had not been informed of
the sale for nominal value following the
2010 transfer of ownership of Alipay, raised
questions about the controversial
transaction. Chinese business publication
Century Weekly criticised Ma for saying that
the purchase was known to the board of
directors of Alibaba Group.
Foreign and Chinese media outlets
criticised the episode for the confidence of
foreign investors’ from investing in China.
Alibaba Group, Yahoo!, and Softbank
reached an ownership agreement in July
2011.
M-PESA (2007, Kenya)
Safaricom, the top mobile phone provider in
Kenya, introduced M-Pesa, a mobile money
service in March 2007. (Safaricom is a part
of the Vodafone Group in the UK, which
controls 40% of the business.) M-Pesa was
initially created by Vodafone, and the UK's
Department for International Development
(DFID) helped pay a portion of the project's
six-month pilot phase.
By utilising cell phones, users can deposit,
transmit, and withdraw money using the
SMS-based M-Pesa system. Customers
can conduct business at any of the 40,000
agent stores across the nation without
having a bank account.
In order to make the system accessible to
users of all income levels, registration and
deposits are free, and pricing for the
majority of other transactions is based on a
tiered structure. Transaction values typically
range between US$5 and US$30.
Bitcoin (2008-2009)
Here’s something interesting about Bitcoin
that you might not have known about.
In order to guarantee that the original 50
Bitcoins would always be present in the
system, Satoshi Nakamoto produced them
in January 2009 using blockchain
technology. Thus, these 50 Bitcoins are
useless and will never be used.
Hal Finney, a computer scientist and early
adopter of Bitcoin who was also the first to
tweet about it, received 10 Bitcoins from
Satoshi Nakamoto in the first P2P Bitcoin
transaction ever.
After people got involved and began to
trade, the process for exchanging Bitcoins
officially started. By the end of 2010, the
value of a Bitcoin had increased from US$0
to $0.83.
Digital payments in the 10s

Google wallet (2011)

The public can now access Google Wallet,
a mobile payment platform, through an
application that can be downloaded from a
United States mobile phone network.
With phones equipped with a special Near
Field Communications (NFC) chip that can
be touched against readers at cash
registers in stores to facilitate purchases,
Google Wallet is striving to displace credit
cards. The company's mobile payment
system using the same name, ‘Google
Wallet,’ was first released in 2011 and then
integrated with Android Pay to create a new
app named Google Pay in 2018.
The Google Pay app had a significant
revamp in 2020 that was based on Google's
India-focused Tez app, becoming a
comprehensive personal finance platform.
While this took the role of the Tez app on
Play Store, Android smartphones still came
with the 2018 Google Pay app pre-installed
as a separate app.
WeChat Pay (2013)
The mobile wallet within the Chinese social
messaging app WeChat was launched with
great success in 2013. WeChat Pay has
taken advantage of China's custom of
giving red packets filled with cash for a
clever marketing promotional campaign.
Around 16 million red packets were shared
on Chinese New Year's Eve in 2014 after
the mobile app introduced its own virtual
red packet, which enables users to transfer
up to US$29 to other WeChat
acquaintances.
Sending red packets and sending money to
other WeChat acquaintances are still
common uses for WeChat Pay these days.
Penguin Intelligence, a division of Tencent,
found that 87.8% of users questioned in
January indicated they sent red packets
using WeChat Pay, with peer-to-peer
payments coming in second at 63 percent.
Apple Pay (2014)
In 2014, Apple Inc. unveiled Apple Pay, a
mobile phone payment system and digital
wallet service. Customers can utilise near-
field communication (NFC) to pay for goods
and services at the point of sale, whether in
person using iOS apps or remotely over the
Internet.
Apple Pay is marketed as an alternative to
credit and debit cards, including chip and
PIN cards and the more conventional
magnetic stripe cards. Apple Pay is
presently supported by the majority of
popular credit and debit cards.
Digital payments in the 20s

Digital wallets are anticipated to overtake

physical wallets as the second most
popular payment method by 2025.
We are now seeing the rise of digital wallets
in their most advanced form yet, with
various features, intricacies, and
enhancements that correlate with this
expensive digital era. The potential for
future progress is vast, as with many of the
Web 3.0 developments underway. Time will
tell how many more developments will be
added to the concept of the digital wallet
which has been an integral part to our way
of life.

EVOLET is a digital wallet app for migrant

workers.
https://evolet.io/a-brief-history-of-e-wallet
How it began

Digital payments date back to 1997 when Coca-

Cola introduced a few vending machines in
Helsinki that allowed consumers to buy a can
via text messages. This is said to be the genesis,
despite the fact that it is significantly different
from modern-day e-wallet transactions.
Soon, mobile devices were used to purchase
movie and airline tickets, make hotel
reservations, and place food orders. Around 95
million cell phone users have made a transaction
using their phones by 2003. In 2011, Google
became the first large corporation to offer a
mobile wallet. Consumers may pay, collect
loyalty points, and redeem discounts using NFC
(near field communications) technology.
Despite the fact that it was only available on one
phone model and was only accepted by a few
merchants, it was a huge hit.
Apple released Passbook in 2012, which could
be used for boarding passes, tickets, and
coupons but not for mobile payments. Two
years later, Apple Pay was released. It began in
the United States and rapidly expanded to the
United Kingdom and China. Android and
Samsung Pay were introduced in 2015.
Since then, digital wallets like as GrabPay,
Lazada Wallet, PayPal, Touch n Go, vcash, and
others have helped to popularise this method of
payment. According to a Juniper Research
report, over 2.1 billion people would use a
mobile wallet to make a payment or send money
in 2019.
Is it expensive?

Transferring rewards may cost some money

with some e-wallets that provide rewards
programs. There might be hidden fees or just
certain ways to get advantages. In 2018, for
example, customers who used the PayPal debit
program earned 1% cashback on regular
signature credit transactions. Using a PIN
through a digital wallet, on the other hand,
would negate this benefit because the
transaction is altered at the point of sale. As a
consequence, paying $900 each month resulted
in a $100 loss for the consumer each year.

The History of E-Wallet — MerchantYard