2 Information System Overview An information system is a collection of people, procedures, software, hardware, and dataHaving sufficient information is crucial to an organization’s successComputers can collect information and then use that information to help people make decisions
3 Management LevelsTop-level managers - responsible for strategic planning -- need highly summarized informationMid-level managers - responsible for tactical planning -- need partially summarized informationSupervisors - responsible for operational matters -- need detailed day-to-day information
4 Information Flow by Management Level Information needs are based on the level of managementTop level managementStrategic: future-orientedInformation summaries from both internal and external sourcesFlow is up and from outside
5 Information Flow by Management Level Middle managementTactical: HistoricalSummarized weekly or monthly information from internal sourcesFlow is horizontal and vertical across functionsSupervisorsOperational: day-to-dayDetailed information from internal sourcesInformation flow is primarily vertical
6 Computer-Based Information Systems There are four kinds of computer-based information systems:Transaction Processing SystemsManagement Information SystemsDecision Support SystemsExecutive Information Systems
7 Transaction Processing System (TPS) Performs routine transactions necessary to conduct business.Records day-to-day transactions (operations) in a databaseMaintains foundational data for the other information systems
8 File and Methods used in Transaction Processing Files Used:Master File – Permanent data recordsTransaction File – Holding file that contains transactions (additions, deletions, and revisions) to be applied to the master file.Methods Used:Batch Processing – Transactions are collected over time and then processed all at once, as a “batch” to update the master file.Online (Real-time) Processing – Each transactions is used to update the master file immediately.
9 Management Information Systems (MIS) Collects and analyzes data from all departments.Produces standardized reports in summarized, structured formDesigned to provide an organization's middle management with up-to-date information (such as financial reports, inventory, etc.) at any time.Unlike transaction processing systems, which create databases, the MIS uses databasesDBMS is required to integrate data across functional areas
10 MIS Common Report Categories Periodic - regular intervals, pre-determined format, consistent contentException - highlight unusual eventsDemand - as opposed to periodic, only upon request
11 Decision Support System (DSS) Helps provide answers to unexpected, non-recurring problemsProduces summaries of large amounts of data, filtered and synthesized to support strategic non-routine, decision-makingCombines data from TPS with analytical models or data analysis toolsUses communications technologies, data, documents, knowledge and/or models to complete decision process tasks.
12 Sample DSS Analyses Sensitivity Analysis What-if Analysis Study of effect that changes in one or more parts of a model have on other parts of the modelWhat-if AnalysisChecks impact of a change in the assumptions or other input data on the proposed solutionGoal-seeking AnalysisFinds the value of the inputs necessary to achieve a desired level of output
13 Executive Information System (EIS) A special type of DSS that presents data so that it is easy to use by top executives without extensive training.Provides corporate information, such as financial condition and market share, usually presented graphically so executives retrieve information by pointing to objects on the screen.Has drill-down capability and access to key external data.
14 Executive Information System (EIS), continued Information is presented in a very aggregate form so executives can quickly scan it for trends and anomaliesAddresses unstructured decision making through advanced graphics and communications.Sourced both internally from TPS and MIS and from external sourcesGives senior management a broad company view, assists with strategic planning
15 Information Systems Summary TPSMISDSSEISRepetetiveLinear LogicRegular ReportsNo Decision SupportSpecialized HeuristicsComplicated LogicNo Regular ReportsSupports Decision Making