Information SystemsUnit 3

Aim and purpose

• To ensure that you understand how organisations use information

• To know about information systems and develop the skills necessary to produce management information.

Learning Outcome

Understand how organisations use business information

Understand the issues related to the use of information

Know the features and functions of information systems

Be able to use IT tools to produce management information

1. Understand how organisations use business information

6Information flows

1Types of informat

ion

2Purposes

of informat

ion3Sources

of informat

ion

4Good

information

5Business functional areas

• Qualitative• Quantitative• Primary• Secondary

1Types of

information

• Monitoring and controlling activity

Operational support e.g.

• To identify patterns or trends;

Analysis e.g.

• Operational• Tactical• Strategic

Decision making

Gaining commercial advantage

2Purposes of information

– financial, – personnel, – marketing, – purchasing, – sales, – manufacturing, – administration;

• government, • trade groupings,• commercially

provided, • databases, • research;

RELIABILITY OF DATA SOURCES 3Sources of

information

Internal External

valid reliable timely fit-for-purposeaccessible cost-effective sufficiently

accurate relevant

having the right level of detail

from a source in which the user hasconfidence

understandable by the user

4Good

information characteristics

Sales

Purchasing

Manufacturing

Marketing

Finance

Personnel

Administration

5Business

functional areas

Internal information flows

Information flows to external bodies

Information flow diagrams

6Information

flows

Legal issues

Ethical issues

Operational issues

2. Understand the issues related to the use of information

Legal issues

Rele

vant

dat

a pr

otec

tion

legi

slati

on e

g Data Protection Act 1998,

Freedom of Information Act 2000;

Oth

er re

leva

nt le

gisl

ation

eg

Computer Misuse Act 1990

Copyright & Patent Act

Ethical issues

• Use of email• Internet• ‘whistleblowing’; • Organisational

policies;• Information

ownership

Codes of

practice eg on

Operational issuesSecurity of

information;

Backups

Health and Safety

Organisational policies

Business continuance plans

Costs eg Additional resources

required,Cost of

development;

Impact of increasing

sophistication of systems eg

More trained personnel,

More complex software

Features of information systems

Functions of information systems

Transformation of data into information

Types of information system

Management information systems (MIS)

3. Know the features and functions of information systems

Data People Hardware Software Telecommunications

Features of information systems

Input

Storage

Processing

Output

Control and feedback loops

Closed and open systems

Functions of information systems

Dis

tincti

on b

etw

een

data

and

in

form

ation

;

collection

storage

processing

manipulation

retrieval

presentation

Transformation of data into information

Management Information

Systems; Others eg

marketing

sales performance,

competitors etc

financial

financial costs,

investment returns etc

human resources (HR)

staffing,

professional development etc

Types of information system

Features

Benefits

Effectiveness criteria eg

accuracy, sustainability,Response

times, confidence

Management information systems (MIS)

Tools

Gather information

Analyse information

Management information

4. Be able to use IT tools to produce management information

Tools

Software eg

Databases

Artificial Intelligence and Expert systems

predictive modellingInternet

Others data mining systems

Gather information

Define the requirement

Establish sources of

information

Define other factors to be considered e.g.• constraints;

Select information

Analyse information

Quality e.g.

Validity Accuracy Currency Relevance Identify alternatives

Management information

Reports

Sales report, College

enrolment statistics,

Marketing analysis (brick versus click)