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Modern business is surrounded by the information systems which are in place to assess the opportunities and limitations available for the businessmen in order to be productive in their respective field. It is impossible to know the information systems without the proper knowledge of the information technology which is changing at a rapid pace nowadays.
The movement and processing of data and information to expedite business operations and decisions is called information systems. (McGraw-Hill, 2000)
Role of information system
The role of the information system is to forecast the needs and demands of the company on the basis of its current usage and to keep in mind the future changes which are going to take place for instance extension of business operations in the new market so the information system can propose larger database which will easily store the data. It is a decision for the top management and includes huge cost.
Types of information systems
Information systems may differ in their needs but the most common types of information systems are discusses in detail below;
Decision support system (DSS)
Management information system (MIS)
Transaction processing system (TPS)
Executive support system (ESS)
This system has to support operational managers by keeping track of the elementary activities and transactions of the organization. The principle function of systems at this level is to answer regular questions and track the flow of transactions through the organization. This system covers things such as sales, receipts, cash deposits, payroll, credit decisions and flow of materials.
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This system looks after the support knowledge and data workers in an organization. The purpose of these systems is to help the organization discover, sort out and put together new and existing knowledge in to the business, and to help control the flow of paperwork. These systems, especially in the form of collaboration tools, workstations, and office systems, are the fastest growing applications in business today.
This is designed to serve the monitoring, controlling, decision-making, and administrative activities of middle managers. These typically provide periodic reports rather than instant on operations. Some of these systems support non-routine decision-making, focusing on less-structured decisions for which requirements are not always clear. This will often require from outside the organization, as well as from normal operational-level data.
It helps senior management to handle and address strategic issues and long-term trends, both within the organization and in the environment outside the operations. The principal concern is matching organizational capability to changes, and opportunities, occurring in the medium to long term (i.e. 5 – 10 years) in the external environment.
Typically, an organization might have operational, knowledge, management and strategic level systems for each functional area within the organization. This would be based on the management model adopted by the organization, so, while the most commonly-adopted systems structure would simply follow the standard functional model, structures reflecting bureaucratic, product and matrix models are also possible.
Transaction-Processing Systems (TPS)
Basic business systems
Perform daily routine transactions necessary for business functions
At the operational level, tasks, resources and goals are predefined and highly structured
Generally, five functional categories are identified, as shown in the diagram.
Office Automation Systems (OAS)
Targeted at meeting the knowledge needs of data workers within the organization
Data workers tend to process rather than create primarily involved in use, manipulation or dissemination.
Typical OAS handles and manages documents, scheduling and communication.
Knowledge Work Systems (KWS)
Targeted at meeting the knowledge needs of knowledge workers within the organization
In general, knowledge workers hold degree-level professional qualifications (e.g. engineers, scientists, lawyers), their jobs consist primarily in creating new knowledge and information for that particular department in order to find out the best suitable candidates to work with the organization.
KWS, such as scientific or engineering design workstations, promote the creation of new knowledge, and its dissemination and integration throughout the organization.
Management information Systems (MIS)
MIS provide managers with reports and, in some cases, on-line access to the organizations current performance and historical records
Typically these systems focus entirely on internal events, providing the information for short-term planning and decision making.
MIS summarize and report on the basic operations of the organization, dependent on the underlying TPS for their data.
Decision-Support Systems (DSS)
As MIS, these serve the needs of the management level of the organization
Focus on helping managers make decisions that are semi-structured, unique, or rapidly changing, and not easily specified in advance
Use internal information from TPS and MIS, but also receive data from the external sources
Greater analytical power than other systems, incorporate modeling tools, aggregation and analysis tools, and support what-if scenarios
They must provide user-friendly, interactive tools
Executive Support Systems (ESS/EIS)
Serve the strategic level of the organization
ESS/EIS address unstructured decisions and create a generalized computing and communications environment, rather than providing any fixed application or specific capability. Such systems are not designed to solve specific problems, but to tackle a changing array of problems
ESS/EIS are designed to incorporate data about external events, such as new tax laws or competitors, and also draw summarized data from internal MIS and DSS
These systems filter, compress, and track critical data, emphasizing the reduction of time and effort required to obtain data useful to executive management
ESS/EIS employ advanced graphics software to provide highly visual and easy-to-use representations of complex and current trends, but they tend not to provide analytical models which can be helpful in carrying out the regular tasks at the operations level.
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We have come a long way from conventional planning in a development project. The reasons for this change are basically related to four conflicting factors that constitute an over-riding problem with formal planning. Large software systems have long development cycles and require extensive planning to control costs, resources, equipment and priorities, that is why organizations have to take into effect extra measures to cope with such large information systems in order to be more productive and to meet the future needs of the business.
Planning is very significant as it will be the very nature of the exercise, which is suppose to seek and undertake future activities in a controlled, reasonable and effective manner. Without the effectiveness of such planning, most of the projects would go into chaos at the early stage of their formations. That is why planning has to be meaningful as the future which depicts on it should be sensible and unchanging.
If there is need for changes to occur, then they should be of a limited or anticipated nature and without rapid transitions but the long term duration software projects suffer quite easily from the major, unforeseen and generally rapid changes. These are due as (among others) the development setbacks, migration of personnel, economic down-turns, strategic reversals, significantly modified the technology and systems had to be changed as the expectations which were required earlier were dramatically change due to these unforeseen circumstances.
Reference and Bibliography
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Kavanagh J, Blind leading the blind into IT fog, Interface, The London Times, 6.8.1997, p.10
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URL Source: www.govcomp.com/executivebrief.html
Date of Access 25th February 2010
Ritzman. L, Malhotra. M, 2009. Operations Management, 9th Edition, P. 31
Maylor. H, 2005. Project Management, 3rd Edition, P. 28
Peter. S, Cavanagh. R, 2001. The Six Sigma Way, P. 161
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