Chapter # 2 System and Models

What is a System?
The three components of Management Information System are;
 Management
 Information
 System
Where Management covers the planning, control, and administration of the operations of a concern. The
top management handles planning; the middle management concentrates on controlling; and the lower
management is concerned with actual administration.
Information, in MIS, means the processed data that helps the management in planning, controlling and
operations. Data means all the facts arising out of the operations of the concern. Data is processed i.e.
recorded, summarized, compared and finally presented to the management in the form of MIS report.

System Definition: is a group of resources which work collectively in order to produce desired output
from given inputs. It receives input and produces the output. The components of the systems
are interconnected and work together to achieve a common objective.

System Explanation: Data is processed into information with the help of a system. A system is made up
of inputs, processing, output and feedback or control. Thus MIS means a system for processing data in
order to give proper information to the management for performing its functions.

In Management Information System (MIS), a system is made up of inputs, processing, output and
feedback or control. It is used to process data in order to give proper information to the management for
performing its functions. An information system is a mix of hardware, software, personnel, and
infrastructure that aids in the collection of data stored in the MIS. The information system component
allows employees to interact with the system for information collection.
Types of Systems:
 Management Information System
 Computer based system
 Transaction processing system
 Management Reporting System
 Decision support system
 Executive information system

Components of System:
Various important components of systems in MIS are as follows:

Inputs involves capturing and assembling elements that enter the system to be processed. For example,
raw materials, energy, data, and human efforts must be secured and organized for processing.

Processing: involves transformation process that converts input into output. Examples are a
manufacturing process, or mathematical calculations.
Output: involves transferring elements that have been produced by a transformation process to their
ultimate destination. For example, finished products, human services, and management information must
be transmitted to their human users

Feedback and Control: A system with feedback and control components is sometimes called a
cybernetic system, that is, a self-monitoring, self-regulating system. • Feedback is data about the
performance of a system. For example, data about sales performance is feedback to a sales manager. •
Control involves monitoring and evaluating feedback to determine whether a system is moving toward
the achievement of its goal. The control function then makes necessary adjustments to a system’s input
and processing components to ensure that it produces proper output. For example, a sales manager
exercises control when he or she reassigns salespersons to new sales territories after evaluating feedback
about their sales performance.

People – these are the users who use the information system to record the day to day business
transactions. The users are usually qualified professionals such as accountants, human resource
managers, etc. The ICT department usually has the support staff who ensure that the system is running
properly.

Business Procedures – these are agreed upon best practices that guide the users and all other
components on how to work efficiently. Business procedures are developed by the people i.e. users,
consultants, etc.

Data – the recorded day to day business transactions. For a bank, data is collected from activities such as
deposits, withdrawals, etc.

Hardware – hardware is made up of the computers, printers, networking devices, etc. The hardware
provides the computing power for processing data. It also provides networking and printing capabilities.
The hardware speeds up the processing of data into information.

Software – these are programs that run on the hardware. The software is broken down into two major
categories namely system software and applications software. System software refers to the operating
system i.e. Windows, Mac OS, and Ubuntu, etc. Applications software refers to specialized software for
accomplishing business tasks such as a Payroll program, banking system, point of sale system, etc.

Environment – In order to function, every system requires a specific environment. A group of factors
forms the environment. The system is surrounded by these environmental factors and it interacts with
these factors to give output. For example, the environment of a system includes customers, competitors,
government and regulatory bodies, customers and vendors.

Models of Information System

5 Level pyramid model diagram

Different levels of the organization have different information processing requirements so a five level
pyramid model is significant in this case. The first level represents transaction processing systems to
process basic data. The second level represents office support systems to process information in office.
The third level represents management information systems to process information by managers. The
fourth level represents decision support systems to process explicit knowledge. The fifth level
represents executive information systems to process tacit knowledge.
"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 system are:

1. Hardware these are the devices like the monitor, processor, printer and keyboard, all of which work
together to accept, process, show data and information.
2. Software are the programs that allow the hardware to process the data.
3. Databases - are the gathering of associated files or tables containing related data.
4. Networks - are a connecting system that allows diverse computers to distribute resources.
5. Procedures - are the commands for combining the components above to process information and
produce the preferred output.
4 Level pyramid model diagram

A four level pyramid model of different types of Information Systems based on the different levels of
hierarchy in an organization. The first level represents transaction processing systems for workers. The
second level represents management information systems for middle managers. The third level
represents decision support systems for senior managers. The fourth level represents executive
information systems for executives.

4 Level pyramid model diagram based on

Decision levels

4 Level pyramid model diagram based on

Hierarchy levels

4 Level pyramid model diagram

based on Data Processing Levels
Data Flow Diagram (DFD)

Data Flow Diagram (DFD) is a technique

of graphical structural analysis,
describing the sources external to the
system, recipients of data, also logical
functions, data flows and data stores
that are accessed. The DFD's goal is to
show how each process converts its
inputs into the outputs and to identify
relationships between these processes

Open vs. Specific Models of System

Open and closed systems are two types of computer systems often used in a business or organizational
context. Both these systems can be used to store, access, and share information and data. The difference
between the two is primarily in how they are designed and operated. An open system allows for
unrestricted access to the network, allowing users to be able to freely and easily interact with each other.
On the other hand, a closed system is more restrictive, with a limited number of users and specific levels
of access that must be granted before a user can access the system.

Open System: An open system is a computerized system that allows unrestricted access to its data and
features. It could be a server, client-server, web-based or custom-designed system. Open systems are
built to provide a general platform where users can interact with different types of data, applications, and
devices. In an open system, the user has control over the tools and data they can access and are free to
modify or customize the system to meet their specific needs without requiring permission or assistance
from the system’s vendor.
The open system model provides several benefits including heightened security, increased scalability,
and improved usability. Security is enhanced through control measures such as user-level authentication
and authorization. Its features allow for the addition or removal of data and users quickly, making it
easier to manage the system. Usability is also improved through customizable features and user-friendly
interfaces that enhance the overall user experience.
Some examples of open systems include Windows, MacOS, Android, iOS, and Linux. Each of these
operating systems provides users with the ability to install and use different applications that are
compatible with the system. This makes it easy to find the necessary tools you need and use them in the
way that you need.
Overall, open systems provide users with more flexibility, better performance, and a more user-friendly
experience than closed systems.
Closed System: A closed system is a type of computer system where access to the system is limited and
restricting. It has complete control over who is allowed to view, access, or manipulate the data. To access
the system, users are required to authenticate themselves with a user ID and password, and in some
cases, biometric authentication such as fingerprint scanning.
The closed system’s main purpose is to protect the data from unauthorized access or manipulation. It has
advanced security features that can prevent hackers or intruders from gaining access to the system. All
software installed on the system must be approved by the administrators and any new applications must
be approved before they can be used on the system.