Information Systems 4 - IS for Biz and Devt - Types of IS PDF

Information Systems INFORMATION SYSTEMS TYPES OF INFORMATION SYSTEMS  Learning Objectives Information systems at different organizational levels Transaction processing system (TPS) Management information system (MIS) Executive Information system (EIS) Decision support system (DSS...

Information Systems INFORMATION SYSTEMS TYPES OF INFORMATION SYSTEMS  Learning Objectives Information systems at different organizational levels Transaction processing system (TPS) Management information system (MIS) Executive Information system (EIS) Decision support system (DSS) Knowledge work Systems (KWS) Office automation Systems (OAS) Expert systems  Information systems at different organizational levels Because there are different interests, specialties, and levels in an organization, there are different kinds of systems. No single system can provide all the information an organization needs. Figure (13) illustrates one way to depict the kinds of systems found in an organization. In the illustration, the organization is divided into strategic, management, and operational levels and then is further divided into functional areas, such as sales and marketing, manufacturing and production, finance and accounting, and human resources. Systems are built to serve these different organizational interests.  Information systems at different organizational levels In the era of digital transformation, organizations are increasingly adopting integrated information systems that enable data sharing and collaboration across different levels. This includes Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM) systems. Cloud-based solutions have become essential, allowing real-time access to data at various organizational levels, promoting agility and remote work.  Different Kinds of Systems Three main categories of information systems serve different organizational levels: operational-level systems, management-level systems, and strategic-level systems.  Operational-level systems  The principal purpose of systems at this level is to answer routine questions and to track the flow of transactions through the organization.  Examples of operational-level systems include a system to record bank deposits from ATM (Automatic Teller Machines) or one that tracks the number of hours worked each day by employees on a factory floor.  Operational systems are used by supervisors (first-line managers), operators, and clerical employees.  Tactical-level systems  serve the monitoring, controlling, decision-making, and administrative activities of middle managers.  The principal question addressed by such systems is this: Are things working well?  Management-level systems typically provide periodic reports rather than instant information on operations.  Management-level systems are broader in scope than operational-level systems, but like operational systems, they use mainly internal sources of data. They provide the types of support shown in the table below. Tactical-level systems  Strategic-level systems  help senior management address strategic issues and long-term trends, both in the firm and in the external environment  Strategic activities are basically decisions that deal with situations that significantly may change the manner in which business is done  Traditionally, strategic decisions involved only long-range planning. A long- range planning document traditionally outlines strategies and plans for the next five or even 10 years.  From this plan, companies derive their shorter-range planning, budgeting, and resource allocation  Transaction Processing Systems TPS's were among the earliest computerized systems. Their primary purpose is to record, process, validate, and store transactions that take place in the various functional areas of a business for future retrieval and use. Serve the operational level of the organization. It is a computerized system that performs and records the daily routine transactions necessary to manage business; they serve the organization’s operational level.  Transaction Processing Systems TPS continues to be crucial in organizations, with an increasing emphasis on automation and real-time processing. Trends include the use of blockchain for secure and transparent transaction processing.  Transaction Processing Systems Examples are hotel reservation systems, payroll, employee record keeping, and shipping A payroll system is a typical accounting TPS that processes transactions such as employee time cards and changes in employee salaries and deductions. It keeps track of money paid to employees, withholding tax, and paychecks. Types of Transaction Processing System (TPS's)  On-line system: involves a direct connection between operator and the TPS program. They provide immediate result and used to process a single transaction at a time. Ex: an order arrives by telephone call; it is processed at that moment and the result are produced.  Batch-processing system: This is a second type of TPS, where transactions are grouped together and processed as a unit. Example: cheque processing system in a bank.  Objectives (Goals) of TPS Process data generated by and about transactions. Maintain a high degree of accuracy. Ensure data and information integrity and accuracy. Produce timely documents and reports. Increase labor efficiency. Help provide increased and enhanced service. Help build and maintain customer loyalty. Achieve competitive advantage.  Transaction Processing Activities Data collection: Capturing data necessary for the transaction. Data editing: Check validity and completeness of data. Data correction: Correct the wrong data. Data manipulation: Calculate, summarize, Process data. Data storage: Update transactions (on Databases). Document production and reports: Create end result reports Transaction Processing Activities  MANAGEMENT INFORMATION SYSTEM An MIS is a computer system consisting of hardware and software that serves as the backbone of an organization’s operations. An MIS gathers data from multiple online systems, analyzes the information, and reports data to aid in management decision-making. MIS are distinct from regular information systems in that they are used to analyze other information systems applied in operational activities in the organization  MANAGEMENT INFORMATION SYSTEM Advanced analytics, including machine learning and AI, are integrated into MIS to provide better insights and decision support to managers. Visualization tools and dashboards help present data in a more comprehensible manner.  Role Of MIS  The role of MIS in an organization can be compared to the role of heart in the body.  The information is the blood and MIS is the heart. In the body the heart plays the role of supplying pure blood to all the elements of the body including the brain.  The MIS plays exactly the same role in the organization.  The system ensures that an appropriate data is collected from the various sources, processed, and sent further to all the needy destinations. Features of MIS  Executive Information system (EIS) An EIS is a special type of DSS designed to support decision making at the top level of an organization. An EIS may help a CEO to get an accurate picture of overall operations, and a summary of what competitors are doing. These systems are generally easy to operate and present information in ways easy to quickly absorb (graphs, charts, etc.).  Executive Information system (EIS) EIS is evolving towards real-time monitoring of key performance indicators and predictive analytics to help executives make strategic decisions rapidly. Mobile EIS applications are becoming more prevalent, enabling executives to access critical information on the go.  A Typical EIS Session The session may start with a report of the firm’s financial and business situation. Key performance indicators are clearly displayed. The EIS will allow the executive to drill down from any figure to see its supporting data. The executive can select a level of detail (for example, sales by state) if further investigation is needed. This top down approach should lead to better decisions.  Decision support system (DSS) These systems support complex non-routine decisions Primary purpose to process data into information DSS systems are typically employed by tactical level management whose decisions and what-if analyses are less structured This information system not only presents the results but also expands the information with alternatives Some DSS methodologies – Mathematical Modeling – Simulation (What-If) – Queries – Data mining – Forecasting  Decision support system (DSS) DSS is embracing machine learning and AI algorithms to offer predictive and prescriptive analytics for more informed decision-making. Natural language processing (NLP) and conversational AI are being integrated into DSS to facilitate human-computer interactions.  Knowledge Work Systems (KWS) KWS serve the information needs at the knowledge level of the organization.  KWS work systems aid knowledge workers, whereas office automation systems primarily aid data workers (although they are also used extensively by knowledge workers. In general, knowledge workers are people who hold formal university degrees and who are often members of a recognized profession like engineers, doctors, lawyers, and scientists  Knowledge Work Systems (KWS) Knowledge management platforms are gaining traction, helping organizations store, organize, and access vast amounts of data and information efficiently. Collaboration tools, including virtual whiteboards and project management software, are enhancing KWS for remote and distributed teams. Office automation Systems (OAS)  OAS are information technology applications designed to increase the productivity of data workers in the office by supporting the coordinating and communicating activities of the typical office.  Word processing, desktop publishing and document imaging systems are OAS applications.  Cloud-based office automation tools, like Microsoft 365 and Google Workspace, have become the standard for communication, collaboration, and document management.  Robotic Process Automation (RPA) is being used to automate repetitive office tasks, increasing efficiency.  Expert system  An expert system is a computer system that emulates, or acts in all respects, with the decision-making capabilities of a human expert  A computer program that emulates the behaviour of human experts who are solving real-world problems associated with a particular domain of knowledge. (Pigford & Braur)  Expert Systems Computer software that:  Emulates human expert  Deals with small, well defined domains of expertise  Is able to solve real-world problems  Is able to act as a cost-effective consultant  Can explains reasoning behind any solutions it finds  Should be able to learn from experience.  Expert Systems  solve simple problems easily.  ask appropriate questions (based on external stimuli - sight, sound etc).  reformulate questions to obtain answers.  explain why they asked the question.  explain why conclusion reached.  judge the reliability of their own conclusions.  talk easily with other experts in their field.  learn from experience.  reason on many levels and use a variety of tools such as heuristics, mathematical models and detailed simulations.  transfer knowledge from one domain to another.  use their knowledge efficiently  Expert Systems Expert systems are increasingly integrated with other systems and data sources, making them more powerful and accurate. With the growth of IoT, expert systems are employed in various fields, such as healthcare and manufacturing, for real-time decision support.  Components of an Expert System  Knowledge base – obtainable from books, magazines, knowledgeable persons, etc.  Inference engine – draws conclusions from the knowledge base Advantages of Expert Systems Increased availability Reduced cost Reduced danger Performance Multiple expertise Increased reliability Explanation Fast response Steady, unemotional, and complete responses at all times Intelligent tutor Intelligent database  SUMMARY Overall, the current trends in information systems revolve around data analytics, integration, automation, and the use of artificial intelligence. These trends are essential to meet the ever-evolving demands of businesses and organizations in today's digital age. As IT professionals and students, it's vital to stay updated with these trends to remain competitive in the field.  SUMMARY Three main categories of information systems serve different organizational levels: operational-level systems, management-level systems, and strategic-level systems. A Transaction Processing Systems (TPS) is used primarily for record keeping which is required in any organization to conduct the business. Decision Support System (DSS) serves the management of an organization. A decision support system has sophisticated data analysis tools, which support and assist all aspects of problem-specific decision-making. An Executive Information System (EIS) is also called the Executive Support System. Senior managers of an organization use the EIS. Therefore, it must be easy to use so that executives can use it without any assistance. The expert systems have the ability to make suggestions and act like an expert in a particular field of an organization. An expert system has an extensive knowledge base.