What is Information Systems ?

In various operations such as e-commerce business, enterprise collaboration and management and in
the strategic success of business information system plays an important role. So, it is important for the
managers and professionals that they effectively use and manage the information system and various
technologies for the success of business.

Information system has a group of procedures, when executed, it provides the information for decision
making and control of organisation. Information system (IS) is integration of following elements.

Procedure

People

Resources

It gathers the information, transforms and distributes that information to the organisation.

Definitions of Information Systems

According to Silver :

"Information system are implemented within an organisation for a purpose of improving the
effectiveness and efficiency of that organisation. Capabilities of the information system and
characteristics of the organisation, its works systems, its people and its development and
implementation methodologies together determine the extent to which that purpose is achieved."

According to James A O'Brien :

"An information system can be any organised combination of people, hardware, software,
communications networks and data resources that stores and retrieves, transform and disseminate
information in an organisation."

Needs of Information Systems in Organisation

1. Supporting Corporate Strategy :

There are three fundamental policies used by organisation to complete in the market.

Provide goods and services at a lower price than their competitors, to stay ahead.

Produce unique goods and services that distinguish them for their competitors.

Search a particular Marketplace and put all, their focus and efforts for meeting requirements of the
Marketplace.

The above three strategies are not manually exclusive. So any organisation can use this combination to
stay ahead of competition and to implement this strategies. Information system and technologies play
an important role.

2. Meeting Global Challenges :

With the globalization, competition on a global scale is increased. To survive in this competition
organisation produce the high quality products and services to maintain the quality and management of
products, people and process around the world, organisations need accurate and reliable information at
the right time.

3. Capturing Opportunities in Marketplace :

Successful companies are able to retain and grow their business over a long period of time. These
companies identify and take benefits of opportunities in the Marketplace. Information system that helps
a company to identify strategic growth opportunity are known as strategic information system.

4. Linking Departments with Different Functions :

Previously organisations having a different department with diverse functions lacked co-ordination
among them. Due to this reason organisation faced the loss of opportunities and increase inefficiencies.

Now a days , almost all organisation treat all different departments as working together with co-
ordination where in the working of each department is important to achieve business goals.

5. Enhancing Worker Productivity :

Information system and technologies are essential tools for a business.

For example, it helps in creating their payrolls, estimating performance of employees, managing the
shop floor, tracking customers and re-order items because this functions have a significant impact on
the day-to-day running activities of any organisation.

6. Increasing Quality of Goods and Services :

Quality is a major component in every organisation. One of the most popular and widely used
approaches to enhance the quality of goods and services in an organisation is total quality management.
Enhancement of quality often involves coordinating tasks and decisions of many department and units,
which are sometime located across the globe. Since the quality oriented decisions are extremely
information sensitive so information system helps the organisation to reach its goals by providing the
correct information to the right person at right time.

Types of Information System

Followings are the types of Information Systems, There are three categories of information systems it
can explain in details.

1) Operations Support Systems

Each and every organisation needs and information system for processing the data which is produced by
the organisation and is used in its operations. Operational Support System facilities information for
internal as well as external use.

The day-to-day functioning of an organisation is monitored by the operational control / support system.
By keeping the track of the resources and the transactions it support the operations of an organisation.

It helps in efficiency processing business transactions, managing industrial processes, supporting

enterprise communications and partnership and updating corporate database.

Types of Operations Support Systems :

1. Transactions Processing Systems (TPS) :

An information system recording the company transactions is term as a TPS. Earlier TPS was used in the
computerized system. TPS is used for recording, processing, validating and storing transactions occurring
the various business functional areas so that this can be used further also.

The data such as sales, purchases and inventory changes are outcomes of the business transactions.
That are recorded and processed by TPS. For both internal and external use a variety of information
products are produced by the transaction processing system.

The evaluation hierarchy of the TPS was from the manual information system to machine assisted data
processing system to electronic data processing systems.

2. Process Control Systems (PCS) :

When an event is generated certain decisions protocols define the actions that are to be performed.
Information system which work like this is known as process control system. Process Control System
takes the decisions automatically for a physical production process. Companies like Coca Cola, Nestle
etc. are using these system.

3. Enterprise Collaboration Systems (ECS) :

Enterprise collaboration system supports the communication, co-ordination and collaboration among
the different work groups and team members of an organisation using the following elements :

Hardware

Software

Data and

Network resources

Enterprise collaboration system is used for sharing information and knowledge efficiently among
individuals and terms of an organisation.

The main goals of Enterprise Collaboration Systems as follows :

a) Communication - Enterprise collaboration system communicates information within groups of an
organisation.

b) Collaboration - Enterprise collaboration system facilitates working together cooperatively on joint

tasks and assignment.

c) Co -ordination - Enterprise collaboration system maintains good co-ordination of individual work

efforts and use of resources among the organisation members.

2) Management Support System (MSS)

Management support system (MSS) emphasizes on managerial use of information resources and
provide information at managerial level for planning and decision making. MSS is considered to be very
effective and efficient information system for an organisation because of the following reasons :

For organizing an information system application, a system framework is used.

Information technology used in business activities is management oriented.

Types of Management Support Systems :

There are various management control system according to the information needed at various
management level this system are as follows :

1. Management Information System (MIS) :

The word MIS is not new, only its automation is new. Earlier the MIS (management information system)
was used as a resources of information by the managers. This information would allow them to plan and
control different operations used in an organisation. Now since the MIS is computerized, it has increased
its accuracy and speed which has allowed more alternatives while solving problem as well as in decision
making.

Management information system provide the following types of information to the companies :

Descriptive or what is information

Predictive or what if information

Diagnostic or what is wrong information

Prescriptive or what should be done information.

MIS is also known as information system, the information and decision system and the computer based
information system.

2. Decision Support System (DSS) :

Decision support system are computer based information system while carrying out decision making
process, DSS supports the managers and the business professional in providing and interactive
information support.

A natural evaluation occurring from transaction processing system and management reporting system
are turn as decision support system (DSS). Decision support systems are interactive and computer based
information system. The managerial end users decision-making processes are assisted with the help of
decision models and specialized database used by DSS. Decision support system DSS is an interactive
Computer Based System which helps decision makers utilize data and model to solve unstructured
problems.

3. Executive Information System (EIS) :

Executive information system considered as a specific form of DSS as it helps in the information
gathering and decision making process of senior executive in a company and meeting the strategic goals
of the organisation. This is ensured by easy access of internal as well as external data.

Executive information system an information system designed to cater the specific need of executive is
known as executive information system. It is also known as executive support system.

EIS is a association of many features of MIS and DSS. It was first developed to meet the requirements of
the top management for strategic information. This provided the management team with instant and
easy access of information about a company critical success factors which are important for attaining a
company's strategic goals.
3) Other System

The other information system include operation, management or strategic application. Few are
explained below :

1. Knowledge Management System (KMS) :

Knowledge management system is a knowledge based system. In a company the creation, organisation
and dissemination of business knowledge is supported by the KMS.

For example : Sales proposes strategies, internet access to best business practices and customer
problem resolution system.

Through knowledge management as a discipline can extend beyond the information centric expect of
any system, then also it deals with information, hence KMS are a class of information system and can be
further build or utilize other information's sources. Whenever any worker needs to create, organise and
share important business knowledge then he is assisted by the knowledge management.

The information can be identified, collected, reserved and transformed into knowledge and the process
of carrying out this steps is knowledge management. It is made accessible so as to foster Innovation and
improve the organisation performance. The creation of a culture and structure is also facilitated by the
knowledge management so as to promote Information sharing and learning. The working principle of
the knowledge management is the assumption that knowledge derived from people, processes, design
and ideas within the organisation has the potential for substance development.

2. Expert System (ES) :

To have knowledge about certain areas so that it can act as an expert consultant to the user is termed as
the expert system. The Expert system is a knowledge based system. The expert system are not used as
the replacement of the human beings instead they are used as the helping hand for the human beings in
using their expertise more efficiently and effectively. It provides expert advice and acts as expert
consultant for the users.

Knowledge bases and software models are the components of an expert system. These components are
useful in answering the various queries. The application areas of expert system are medicine, business
and Physical Science. At any specified time period expert system can assist either operations for
managerial activities.
3. Business Information System (BIS) :

A company's elementary business function various operational and managerial applications are
supported by the business information system.

For example : information system supporting accounting, finance, marketing, operations management
and human resources management applications.

4. Strategic Information System (SIS) :

The strategic information system supports the operations and management processes. It is helpful in
competing with the competitor as these provide a firm with strategic, products, services and
capabilities.

For example : Online stock trading, E-Commerce web system and shipment tracking.

The systems which are of most important even other than just managing its existing routine function
effectively are deals with strategic information system. It assists in getting over the competitors by
changing the goals, operations, products, services or environmental relationships and is a technological
system at every organisational level. The systems which have an important role in achieving the overall
objective of the organisations are concerned with strategic information system.

5. Office Automation System (OAS) :

The functions of the office automation system is collecting, processing, storing and transmitting the data
and information in the form of electronic office communication. Another definition of the office
automation system can be a computer based information system which collect, processes, stores and
transmit electronic messages, document and other form of communication among individual, work
group and organisation.

For example : Word processing, desktop publishing, telecommunication, electronic mail and document
image processing.