Information SystemsBy

Anilkumar R

Objectives System Data vs. Information Strategic role of information in management Organization as an information system TPS MIS DSS ESS OAS Networking concepts Telecommunications networks

SystemWhat Is a System?

System: A set of components that work together to achieve a common goal

Subsystem: One part of a system where the products of more than one system are combined to reach an ultimate goal

Closed system: Stand-alone system that has no contact with other systems

Open system: System that interfaces with other systems

InformationProcessed date is called information

Information System An information system (IS)- is any combination

of information technology and people's activities that support operations, management and decision making. 

In a very broad sense, the term information system is frequently used to refer to the interaction between people, processes, data and technology. In this sense, the term is used to refer not only to the information and communication technology (ICT) that an organization uses, but also to the way in which people interact with this technology in support of business processes.

Components of Information System:

Example – Health Care Information System:

InformationWhy Do People Need Information?

Individuals - Entertainment and enlightenment

Businesses - Decision making, problem solving and control

Data vs. InformationData raw facts no context just numbers and text

Information data with context processed data value-added to data

summarized organized analyzed

Data vs. Information Data: 51007 Information:

5/10/07 The date of your final exam. $51,007 The average starting salary of an accounting major. 51007 Zip code of Bronson Iowa.

Data ManipulationExample: customer survey Reading through data collected from a customer survey

with questions in various categories would be time-consuming and not very helpful.

When manipulated, the surveys may provide useful information.

Data vs. Information

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Information

Data Information Knowledge

Data

Information

Summarizing the data

Averaging the data

Selecting part of the data

Graphing the data

Adding context

Adding value

Data Information Knowledge

Information

Knowledge

How is the info tied to outcomes?

Are there any patterns in the info?

What info is relevant to the problem?

How does this info effect the system?

What is the best way to use the info?

How can we add more value to the info?

Information SystemsGeneric Goal: Transform Data into Information

At the Core of an Information System is a Database (raw data).

Information Systems (TSP and PCS)

Data doesn’t just appear,Capturing Data is really the first step

These systems help capture data but they also have other purposes (goals):

1. Transaction Processing Systems (TPS)

2. Process Control Systems (PCS)

Capturing Data What are some examples of real TPS’s?

What kind of data is being capture?

How is this data transformed into Information?

Data Processing Recall that a basic system is composed of 5 components

Input, Output, Processing, Feedback, Control

Typically processing helps transform data into information.

Input OutputProcessing

Raw Data Information

Processing Summarizing Computing Averages Graphing Creating Charts Visualizing Data

Processing: Great ExampleNavigation System

Specialized Geographic Information System Input: Maps, Addresses, Points of Interest, “Yellow Pages”

Processing: Computing Shortest Paths; Finding the Nearest Chinese Restaurant

Output: Directions (each turn + a map with arrows) List of nearby Chinese Restaurants (sorted by dist.)

Analysis – Navigation System

Recall that Information Systems have five more specific components:

People, Data, Communication Network, Hardware, Software. In a Navigation System…

what is the Communication Network? what is the Hardware? who are the People?

Data, Information,and Systems

Figure 1.3 Several subsystems make up this corporate accounting system.

Types of Information System:

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Fig 2.1: Types of Information Systems

Transaction Processing System

KWS

MIS

ESS

DSS

Executives

Senior Managers

Workers

Transaction Processing System

A TPS support the monitoring, collection, storage, processing and dissemination of the organization’s basic business transitions.

It also provides the input data for many applications involving support systems such as DSS.

Some times several TPSs exit in one company

The TPS are considered critical to the success of any organization since they support core operations such as purchasing of materials, billing customers, preparing a payroll and shipping goods to customers

Routine Business Transactions in a Manufacturing Company

PayrollEmployee time cardsEmployee pay and deductionsPayroll checks

SalesSales recordsInvoices and billingsAccounts receivable Sales returnsShipping

PurchasingPurchase ordersDeliveriesPayments (accounts payable)

Production Production reports Quality-control reports

Finance and accountingFinancial statementsTax recordsExpense accounts

Inventory managementMaterial usageInventory levels

Management Information System

It is also popularly known as the Information system, the Information and Decision system, the computer based Information system

Definitions of MIS:

The MIS is defined as a system which provides information support for decision-making in the organizationThe MIS is defined as an integrated system of man and machine for providing the information to support the operations, the management and the decision-making function in the organization.The MIS is defined as Computer based Information system

MIS MIS is an information system, which processes data and

converts it into information.  A management information system uses TPS for its data inputs. The information generated by the information system may be used for control of operations, strategic and long-range planning. Short-range planning, management control, and other managerial problem solving. It encompasses processing in support of a wide range of organizational functions & management processes. MIS is capable of providing analysis, planning & decision making support. The functional areas of a business may be marketing, production, human resource, finance and accounting.

Characteristics of MIS They are flexible, allowing for many different ways of

analyzing data and evaluating information; They are capable of supporting a range of skills and

knowledge; They help managers get things done through interpersonal

communication with other members of the organization; Because managers are busy people who switch rapidly

between different tasks, they should not require extensive periods of concentration; They should make it easy to interrupt the work and return to

it at a later time; They should protect a manager, as far as possible, from

information overload.

Case study:Case study: Buying a new car

If you want to purchase a new car from a Ford dealer, chances are that the make and model you want, in the right colour with the right accessories, is not in stock. It’s just too expensive to have cars with every possible combination of options sitting in the parking lot waiting for a customer. In the past, it’s been almost impossible for dealers to track down exactly the model that a customer wants.

With the new information system, the dealer can type the details of the required car into a terminal connected to the main Ford plant at Dagenham. The information will then come back to tell the dealer whether there are any cars available of that specification, and exactly where they are. They may be on the Ford parking lot, or there may be only two available, one at a dealer's in Perth and the other in Bournemouth. There may be none available – in which case Ford will make one for you, though this may take some time.

Plant production managers are also connected to the system, and so they know exactly what cars have

been ordered and can adjust production to reflect demand every day. Discussion: This is an example of a management information system. How does it help

– the dealer?

– the customer?

– the manufacturer?

Discussion:Discussion: A car company gathers information about its customer base through many sources, including market research surveys. One company has discovered that it has relatively fewcustomers in the 18-30 age range. How can this information be used by the company to improve

its sales?

Decision Support System Gorry and Scott-Morton coined the phrase ‘DSS’ in 1971: “A DSS is an interactive computer based system that helps decision

makers utilize data and models to solve unstructured problems.”

A decision support system (DSS) is a computer-based information system that supports business or organizational decision-makingactivities. DSSs serve the management, operations, and planning levels of an organization and help to make decisions, which may be rapidly changing and not easily specified in advance. Decision support systems can be either fully computerized, human or a combination of both.

A decision support system may present information graphically and may include an expert system or artificial intelligence (AI). It may be aimed at business executives or some other group of knowledge workers.

Typical information gathered by DSS are: Comparative sales figures between one week and the next Projected revenue figures based on new product sales

assumptions The consequences of different decision alternatives, given

past experience in a context that is described

Benefits of DSS

Improves personal efficiency Speed up the process of decision making Increases organizational control Encourages exploration and discovery on the part of the decision maker Speeds up problem solving in an organization Facilitates interpersonal communication Promotes learning or training Generates new evidence in support of a decision Creates a competitive advantage over competition Reveals new approaches to thinking about the problem space Helps automate managerial processes Create Innovative ideas to speed up the performance

In 1987, Texas Instruments completed development of the Gate Assignment Display System (GADS) for United Airlines. This decision support system is credited with significantly reducing travel delays by aiding the management of ground operations at various airports, beginning with O'Hare International Airport in Chicago and Stapleton Airport in Denver Colorado

DSS EXAMPLES: MSN Autos - http://autos.msn.com/Default.aspx Big Charts -- http://bigcharts.marketwatch.com/ Databeacon Demos -- http://www.storydata.com Documentum eRoom - http://www.documentum.com elaws Family and Medical Leave Act Advisor -

http://www.dol.gov/elaws/fmla.htm Fidelity Calculators - http://www.401k.com/401k/tools/tools.htm Inspire - http://interneg.carleton.ca/inspire/ Pinnacor - http://finance.pinnacor.com/ Principal Financial - http://www.principal.com/calculators/index.htm WATERSHEDSS - http://www.water.ncsu.edu/watershedss/ Categorization and Evaluation Exercise

Group Decision Support SystemsA GDSS is an interactive computer based system that facilitates the solution of semi structured and unstructured problems when made by a group of decision makers. The objective of a GDSS is to support the process of arriving at a decision.

Case study: See Page 555 [Virtual meeting at the world Economic Forum] by Wiley Edition authored by Turban, Mclean and Wetherbe

GDSS Example:EX 1:

Internal Revenue Service, which used a one-room GDSS to implement its quality-improvement programs based on the participation of a number of its quality teams.

The GDSS was helpful in identifying problems, generating and evaluating ideas and developing and implementing solutions.

EX 2:

European automobile industry which used a one-room GDSS to examine the competitive automotive business environment and make ten-year forecasts, needed for strategic planning.

Executive Information System / Executive Support System

EIS

An executive information system (EIS) is a type of management information system that facilitates and supports senior executive information and decision-making needs. It provides easy access to internal and external information relevant to organizational goals. It is commonly considered a specialized form of decision support system (DSS)

ESS

An ESS is a comprehensive support system that goes beyond EIS to include analysis support, communications, office automation and intelligence support.

Executives’ information needs

Prompt, easy-to-use information (quick response time, simple user interface)

Presentation should fit his style High degree of summarisation Details on demand Critical success factors Exceptions External and internal sources

Features of an EIS

Access to internal and external data What-if analysis Ad hoc queries Drill down Project tracking Colour business graphics Network connections, e-mail access High security

Advantages of EIS Easy for upper-level executives to use, extensive computer

experience is not required in operations Provides timely delivery of company summary information Information that is provided is better understood EIS provides timely delivery of information. Management can

make decisions made promptly. Improves tracking information Offers efficiency to decision makers

Disadvantages of EIS System dependent Limited functionality, by design Information overload for some managers Benefits hard to quantify High implementation costs System may become slow, large, and hard to manage Need good internal processes for data management May lead to less reliable and less secure data

Types of EIS software Prewritten EIS, e.g.

Command Center – Pilot Software, Inc. Commander - Comshare Executive Edge – Execucom

Custom EIS, e.g. MIDS at Lockheed-Georgia

TO SUPPORT EVERYDAY BUSINESS OPERATIONS:

TPS - TRANSACTION PROCESSING SYSTEM OAS - OFFICE AUTOMATION SYSTEM

TO SUPPORT MANAGERIAL DECISION MAKING

MIS - (FUNCTIONAL) MANAGEMENT INFORMATION SYSTEM DSS - DECISION SUPPORT SYSTEM GDSS - GROUP DECISION SUPPORT SYSTEM EIS - EXECUTIVE INFORMATION SYSTEM ESS - EXECUTIVE SUPPORT SYSTEM ES - EXPERT SYSTEM

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Fig 2-2: The six major types of information systems.

INTEGRATED BUSINESS SOFTWARE

Integrates all business functions and processes:Accounting and ControllingFinance and InvestmentInventory ControlMateriel ManagementHuman Resource ManagementProductionSales and DistributionProject ManagementPlant Maintenanceetc.

Major integrated enterprise solution providers world wide:

SAP (R/3 system) PeopleSoft Oracle JDEdwards (OneWorld) BAAN etc. Megatrend (Infosys) Hungarian company

EXPERT SYSTEMS

AI – Artificial Intelligence

Use of computers to perform tasks that normally require high-level human intelligence

- Humans acquire & input data to their brains through their five senses (vision, hearing, smell, taste & touch)

- Computers must have a way of mimicking one or more of these sensing capabilities (computer vision or “hearing”)

AI areas

Robotics (primary areas of research & applications); Computer vision (image processing – recognize & interpret high

level patterns & make them meaningful – e.g. defective product, smart weapons);

Speech recognition (recognizing spoken words – e.g. dictation); Natural language processing (derive the meaning of a

sentence); Neural networks (like brains – learning); Expert systems (attempt to reach the same conclusions about a

problem as the best human expert would) wide variety of potential applications in business.

Expert System (ES)

Other examples of Experts Systems Diagnosis of bacteriological diseases in patients Diagnosis of malfunctions in diesel electronic

locomotives Configuration of a computer system based on a

customer’s anticipated application workload Quality control of products

Advantages of ES Can replace expensive or non-available experts; Can merge knowledge of many experts (preserving, replicating & distributing expert knowledge); Decision making is consistent; Decision making is faster; ES can work under difficult or dangerous situation (wars) Reasoning is explained and documented (insight into the decision making process – explain the

rationale by which they reached the decision); ES can be integrated to other type of information systems like

DSS or EIS.

Disadvantages of ES

Narrow focus (very narrow domains of applications) Expensive to develop and maintain Difficult to test (impossible to present all the possible cases) Expert’s knowledge is difficult to obtain and put to the computer’s

knowledge base Communication capabilities are poorer (no vague questions!!!)

Thank You All