Chapter 6

OrganizationalInformation Systems

Chapter 6 Objectives• Understand characteristics of operational,

managerial, and executive information systems

• Understand characteristics of transaction processing systems, management information systems, and executive information systems

• Understand characteristics of information systems that span organizational boundaries

Types of Information Systems

• An organization consists of many people with different interests, specialties, and levels.

• How a single information system can provide all the information that an organization needs?

• There is no such single information system.• An organization should have different info

systems for different interests, specialties, and levels.

Decision-Making Levels of an Organization

Decision-Making Levels of an Organization

• Executive level (top)– Long-term decisions– Unstructured decisions

• Managerial level (middle)– Decisions covering weeks and months– Semistructured decisions

• Operational level (bottom)– Day-to-day decisions– Structured decisions

Basic systems model for all Info. Systems

General Types of Information Systems

• Transaction Processing Systems (TPSs)– Transactions– Used at Operational level of the organization– Goal: to automate repetitive information

processing activities• Increase speed• Increase accuracy• Greater efficiency

General Types of Information Systems

• Transaction Processing Systems (TPSs)– Online processing– Batch processing

• Data input– Manual data entry– Semiautomated data entry– Fully automated data entry

General Types of Information Systems

• Transaction Processing Systems (TPSs)– Examples:

• Payroll• Sales and ordering• Inventory• Purchasing, receiving, shipping• Accounts payable and receivable

General Types of Information Systems

• Management Information Systems (MISs)– Two Types:

• Management of IS in organizations• Specific information systems for mid-level managers

– Used at managerial level of the organization

General Types of Information Systems Management Information System

• It helps the middle managers with reports, with on-line access to the organization’s current performance and historical records.

• It primarily serves the functions of planning, controlling, decision-making at the management level.

• Generally it depends on TPS for data.• It summarizes and reports on the basic operations of

the organization.• It usually serve managers interested in weekly,

monthly, and yearly results, not day-to-day activities.• It generally addresses structured questions that are

known in advance.• It is not flexible and have little analytical capability.

General Types of Information Systems Management Information System

• What are the functions of management-level info system? => Helps middle managers for monitoring, controlling,

decision-making, and administrative activities. => Generally it provides periodic reports rather than

instant information => However, some systems supports nonroutine decision

making.• It should answer the questions: => Relocation Control System: It reports on the total

moving, house-hunting, and home financing costs for all employees in the organization. It will also notify if actual costs exceed the budgets.

=> What would happen to our return on investment if an organization schedule were delayed for six months?

General Types of Information Systems

• Management Information Systems– Types of reports:

• Scheduled report• Key-indicator report• Exception report• Drill-down report• Ad hoc report

General Types of Information Systems

• Management Information Systems (MISs)– Examples:

• Sales forecasting• Financial management and forecasting• Manufacturing planning and scheduling• Inventory management and planning• Advertising and product pricing

General Types of Information Systems Executive Information Systems

• It helps senior managers.• It addresses unstructured decisions.• It provides a generalized computing &

telecommunications capability to solve problems.• It employs the most advanced graphics software.• It can deliver graphs & (historical data and

competitive data) from internal corporate systems and external databases.

• Senior managers often have little experience with computer-based information systems, ESS should have easy-to-use graphic interfaces.

General Types of Information Systems

• Executive Information Systems (EISs)– Used at executive level of the organization– Highly aggregated form– Data types

• Soft data – news and nonanalytical data• Hard data – facts and numbers

General Types of Information Systems

• Executive Information Systems (EISs)– Examples:

• Executive-level decision making• Long-range and strategic planning• Monitoring internal and external events• Crisis management• Staffing and labor relations

Information Systems that Span Organizational Boundaries

Information Systems that Span Organizational Boundaries

• Decision Support Systems (DSSs)– Designed to support organizational decision

making– “What-if” analysis

• Example of a DSS tool: Microsoft Excel• Text and graphs

– Models for each of the functional areas• Accounting, finance, personnel, etc.

Information Systems that Span Organizational Boundaries

• Expert Systems (ESs)– Mimics human expertise by manipulating

knowledge– Rules (If-then)– Inferencing

Information Systems that Span Organizational Boundaries

• Office Automation Systems (OASs)– Examples:

• Communicating and scheduling• Document preparation• Analyzing data• Consolidating information

Relationship of Systems to one another: Integration

ESS

MISDSS

OAS TPS

Information Systems that Span Organizational Boundaries

• Collaboration Technologies– Virtual teams– Videoconferencing– Groupware– Electronic Meeting Systems (EMSs)

Information Systems that Span Organizational Boundaries

• Functional Area Information Systems– Geared toward specific areas in the company:

• Human Resources• Benefits• Marketing

Information Systems that Span Organizational Boundaries

• Global Information Systems– International IS– Transnational IS– Multinational IS– Global IS