WHY DO WE NEED INFORMATION SYSTEM IN AN ORGANIZATION?

HOW DO INFORMATION SYSTEMS INFLUENCE MODERN BUSINESS?

• NEW PRODUCTS AND SERVICES

• INFORMATION STORAGE
• EASIER DECISION MAKING
NEW PRODUCTS AND SERVICES

• INFORMATION SYSTEM can give a company the competitive advantage by analyzing how a
company creates, produce, and sell their products or services.
INFORMATION STORAGE

• Every organization needs records of its activities to find the cause of problems and proper
solutions. Information systems come in handy .When it comes to storing operational data,
communication records, documents, and revision histories.
• Manual data storage will cost the company lots of time, especially when it comes to searching for
specific data.
• A quality information system stores data in a comprehensive and sophisticated database which
makes the process of finding it convenient.
• With such information, a company can analyze how certain actions affected the business as well
as prepare cost estimates and forecasts.
•.
EASIER DECISION MAKING

• Without an information system, a company can take a lot of time and energy in the decision
making process.
• However, with the use of information system, it’s easier to deliver all the necessary information
and model the results and this can help you make better decisions.
• The management team can use the information system to choose the best course of action
.And carry out the tasks.
• When there are several appealing alternatives, the information system can be used to run
different scenarios by calculating key indicators such as costs, sales, and profits. This way,
you can determine the alternative with the most beneficial results.
BEHAVIORAL CHANGE

• Employers and employees can communicate rapidly and more effectively with an
information system.
• While emails are quick and effective, the use of information systems is more efficient.
Since documents are stored in folders that can be shared and accessed by employees.
• This implies that information flows from the management to lower-level employees
and vice versa.
• Also, the lower-level employees get enlightened and involved in important decision
making, and this eliminates the need for middle managers.
• Employees who are directly involved in the decision-making process are motivated
and dedicated to their tasks.
ORGANIZATIONS AND INFORMATION SYSTEMS
IMPLEMENTATION OF INFORMATION SYSTEM

• FACTOR # 1. STRATEGY:
• Strategy is the essence of modern business. A business cannot survive without the strategies.
• Strategies are those strength and weaknesses, which are internal to organization. Information
system possesses the information regarding these two dimensions of the organization.
• Based on these, information plans are designed to achieve to opportunities available, and to fight
against threats available in the external environment.
• Computer helps us in analyzing data quickly and with great accuracy.
• Thus, computerized information system assists the managers to access and use the information in
the sound strategic decision making accurately and quickly.
FACTOR # 2. REVENUE & EXPENSE:

• Naturally, the use of computer system in information development and storage and retrieval has helped
the business organizations to minimize its cost of operation.
• Computer has successfully replaced the human beings in most of the clerical operations. It has only
one time cost ,installation cost, which is subjected to depreciation and helps the organization in saving
tax.
• Whereas, in case of human beings is an operating expense and it is charged to p&l account as an
expenditure.
• In comparison to human beings, a computer is quite cheaper. Its application to information system is a
cost saving device, which helps the business organizations to cut down operating costs and increase
non-operating revenue
FACTOR # 3. QUALITY

• One reason to use the computer is to improve the quality of output. Word processing is the most commonly used device in most of the
firms. It helps the executives to compose and edit their document on screen. They can make change as and when they require
• They can also insert diagram, flow charts and tables in the document. This process is far better than retyping document
manually with each change. The output is always attractive as there will be no strikeout or correction fluid on the finish
product.
• Secondly, power point helps the executives to deliver the effective presentation to the board members with the help of audio-
visual or visual slide in a very effective manner.
• Thirdly, an engineer uses a computer terminal to draw their drawings. They can store their drawing files on hard disk; it can be
recalled later for easy modification.
• A system like this will also plot a drawing copy, changes are drawn only in few minute & this provide relief to engineers in
redrawing design with little modifications. However, manually, it was a very time consuming and tiresome job.
FACTOR # 4. IMPACT ON INDIVIDUAL

• Many of the previous studies of the impact of the computer system were concerned with user
reactions.
• Some of these studies dealt with psychological reaction of workers.
• Whereas, other studies were concentrated on overall change in the level of employment.
FACTOR # 5. IMPACT ON ORGANISATION

• The availability of timely, accurately, quickly and economical availability of information would allow the management to
centralize the power of decision-making. Before the development of the computer system, the trends were towards the
decentralized management.
• Because, the centralized management could not cope with the amount of information and the number of decisions required in
big organization. Computers offer the power to make centralize management possible so the group of to make centralize
management possible so the group of top management can tightly control the organization.
• There is poor empirical support to this early prediction. In an investigation few cases have been noticed of being decentralize
after computer system were installed. Moreover, early predictions assume that centralization is a negative motivating factor.
• In addition, decentralization provides motivation to the employees as decentralization enhances the employees participation in
the firm through the extension of authorities and responsibilities
FACTOR # 6. DISTRIBUTION OF POWER

•The real problem, which is associated with the implementation of computerized information system in an
organization, is a dimension. This new information system influences the distribution of power in the organization.
•Power is a potential to influence others .To act as per our wish. Different departments of the organization have
different level of power.
•Extent to which the department can cope up with uncertainty for other department.
• Numbers of links to a department, the greater its power.
• Possibility of easy replace-ability.
• The degree of interdependence .Between the department of interest and all other departments in the
organization.
BENEFITS OF INFORMATION SYSTEMS IN BUSINESS

➢Operational efficiencies,
➢Cost reductions,
➢Supply of information to decision-makers,
➢Better customer service,
➢Continuous availability of the systems,
➢Growth in communication capabilities and methods,
➢To maximize the benefits of your IT system, you have to fully utilize all its features and functions. For example, you can
➢Use instant messaging, emails, voice and video calls, and even chatbot technology to improve communication with customers and suppliers. This could save you time,
money and effort, allowing you to react quickly to new work.

➢Integrate various it systems to reduce administrative costs. For example, you can link your online e-commerce shop front with stock control and accounting systems to
streamline your processes. Use labelling products with unique numbers and scannable barcodes to boost your efficiency, and improve your stock control and supply chain
management.

➢Use different solutions, such as customer management systems or mobile technologies, to improve levels of customer service. These may help you record, organize and
plan contact with customers, access customer details on the go and view customer interactions.
• Company record-keeping
• Your company needs records of its activities for financial and regulatory purposes .As well as
for finding the causes of problems and taking corrective action.
• The information system stores documents and revision histories, communication records and
operational data.
• The trick to exploiting this recording capability is organizing the data and using the system.
• To process and present it as useful historical information. You can use such information to
prepare cost estimates and forecasts and to analyze how your actions affected the key
company indicators.
POSITIVE IMPACT OF INFORMATION SYSTEMS

• Speed ​in access to information

• Created a new startup
• Cost-effective and connected anywhere
NEGATIVE IMPACT OF INFORMATION SYSTEMS

• Business competition is not healthy, especially for those who do not take advantage of
the information system. As a container in seeking consumers. As in indonesia, where there
are disputes between users access to devices and users without access device example only
uber, taxi ,grab bike and that is a debate between the two sides.
• Mass layoffs, from where with technological developments into action, in which human labor
began to be replaced by the era of robots. From the information system is the owner of the
company in general will keep costs with this digital era of globalization.
• Privacy, security of personal data problem becomes serious. Proven in the current era where
a lot of data already in computers to register. From this it would seriously data security
becomes a major factor will be the development of information systems era.
IMPORTANCE OF INFORMATION SYSTEMS IN AN
ORGANIZATION
BUSINESS OPERATIONS MANAGEMENT

• How you manage your company's operations depends on the information you have.
Information systems can offer more complete and more recent information, allowing you
to operate your company more efficiently. You can use information systems to gain a
cost advantage over competitors. Or to differentiate yourself by offering better customer
service. Sales data give you insights about what customers are buying and let you stock
or produce items that are selling well. With guidance from the information system, you
can streamline your operations.
COMPANY DECISION-MAKING

• The company information system can help you make better decisions .By delivering all the
information you need and by modeling the results of your decisions. A decision involves
choosing a course of action.
• From several alternatives and carrying out the corresponding tasks. When you have
accurate, up-to-date information, you can make the choice with confidence.
• If more than one choice looks appealing, you can use the information system to run different
scenarios.
• For each possibility, the system can calculate key indicators such as sales, costs and profits
to help you determine. Which alternative gives the most beneficial result.
HELPS IN COMPARISON OF BUSINESS PERFORMANCE

• Helps in comparison of business performance

• Management information system can store all past data and information in its database.
That why management information system is very useful .To compare business
organization performance.
• With the help of management information system companies can analyze his
performance means, whatever they have achieved as well as the loop holes of last
years, and whatever business performance in this year and also measures organization
development and growth
HELPS IN ANALYZING AND PLANNING

• The MIS plays an important role in the planning process since it lets you
manage all data and think of an easier way to plan your business goals.
Good planning is impossible without information and an outstanding
management information system.