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INTRODUCTION TO INFORMATION SYSTEM
INFORMATION SYSTEM - An information system is a specific type of system in general. It is a combination of hardware, software, infrastructure and trained personnel organized to facilitate planning, control, coordination and decision making in an organization. It is an integrated set of components for collecting, storing and processing data and for providing information, knowledge and digital products. •Business firms and other organizations rely on information systems to carry out and manage their operations interact with their customers and supplies and compete in the marketplace. INFORMATION SYSTEM OBJECTIVES System User Organizational Strategic level and by the short term or long term perceived benefits. Main goal of Information System in particular, the objective of an information system is to provide the appropriate outputs to the members of the organization. An organization is an example of an artificial system. It is a formal social unit devoted to the attainment of specific goals. Therefore, Information system is concerned with an efficient and effective planning control functions of the management. MAJOR COMPONENTS OF INFORMATION SYSTEM Computer Hardware - These are physical equipment used for input, output and processing. COMPUTER SOFTWARE - These are programs/ application program used to control and coordinate the hardware components. It is used for analyzing and processing of the data.
- System Software is the operating system which manages the hardware’s operation.
- Application Software is a program designed to handle specific tasks for users TELECOMMUNICATIONS - It is used to connect, or network, computer systems and portable and wearable devices and to transmit information. Connections are established via wired or wireless media Telecommunications DATABASES AND DATA WAREHOUSES Database is a collection of interrelated data organized so that individual records or groups or records can be retrieved. Data warehouses contain the archival data, collected over time, that can be mined for information. DATA VS INFORMATION Data are the raw materials from which information is derived.
Information is what results from the thoughtful analysis, manipulation, and presentation of data in a form that will enhance the decision-making process. HUMAN RESOURCES AND PROCEDURES Human Resources is associated with the manpower required to run and manage the system. Procedures are the policies and methods to be followed in using, operating and maintaining an information system. TYPES OF INFORMATION SYSTEM TRANSACTION PROCESSING SYSTEM It is an information processing system that captures and processes every single transaction that takes place within the organization. These transactions include activities involving collection, retrieval, modification, and all other sets of activities that trigger the retrieval of all transactions. A transaction processing system is highly reliable, consistent, and efficient. Transaction processing systems may also be referred to as real-time processing systems. FUNCTION OF A TPS Inputs to a transaction processing system come from users and other transaction processing systems. Outputs go to users and other transaction processing systems. Transaction processing system software accepts data about transactions, processes it, makes changes in stored data, and produces the outputs Transaction processing system files and databases store data about the state of the organization SOME EXAMPLE OF TPS Handling and Managing Operations
EXECUTIVE INFORMATION SYSTEM
EIS - are strategic-level information systems that are found at the top of the pyramid. They help executives senior managers analyze the environment in which the organization operates, to identify long term trends, and to plan appropriate courses of action FUNCTION OF EIS EIS organizes and present data and information from both external data. Sources and internal MIS or TPS in order to support and extend the capabilities of senior executives. The role of EIS Are concerned with ease of use Are concerned with predicting the future Use internal and external data sources Use only at the most senior management levels
IMPORTANCE OF INFORMATION SYSTEM
- Enhanced competitive position (increased market shares or profits).
- Increased productivity (lower costs per unit of output).
- Improved quality of products or services leading to higher customer satisfaction.
- Improved decision-making ability.
- Ability to respond faster to the demands of the marketplace.
- Enhanced ability to communicate and collaborate within the firm and with customers and suppliers.
- Enhanced goodwill of employees USING INFORMATION SYSTEMS AND INFROMATION TECHNOLOGIES It is often observed that term information system and information technology are used interchangeably. In a literal sense, information technology is a subset if information system. Information system consist of people, processes, machines and information technology. INFORMATION SYSTEM An information system can be defined as a set of coordinated network of components, which act together towards producing, disturbing and processing information. An important characteristic of computer- based information systems information is precision. Infomation technology can be defined as the study, design, implementation, support or management of computer based information system. IT typically includes hardware, software database and networks. Information Technology often governs the acquisition, processing, storage and dissemination of digitized information, or data generated through the disciplines of computing and telecommunication. COMPARISON OF INFORMATION SYSTEM AND INFORMATION TECHNOLOGY ORIGIN: Information systems have been in existence since premechanical era in form of books, drawings etc. Information Technology invention of computers.
Evolution of Information System Models Information systems have been represented by a number of different approaches or models. Older models are not immediately replaced by the newest technique. Before, computer programmers are just creating applications for science and with calculations. Field study is needed to bridge the gap between programmers and the business world. In the mid 1950’s , the first business organization of computers performed repetitive, high volume, transactions-computing tasks. An information system supports each department in a corporation. From EDP to MIS 1960’s, MIS was mainly used for electronic data processing (EDP), purposes such as transaction processing, recordkeeping, and accounting. Also called transaction processing system (TPS), automatic data processing, or information processing. In addition, another role was added to the use of computers: the processing of data into useful informative reports. Management information was born. 1970’s, where the concept of decision support system (DSS) was born. The new role for information systems was to provide managerial end users with ad hoc interactive support of their decision-making process. In the 1980's , the introduction of microcomputers into the workplace ushered in the new era, which led to a profound effect on organizations. End users could now use their own computing resources to support a centralized corporate information services department. End users could now use their own computing resources to support their job requirements. Moreover, executive information system (EIS) was developed. From MIS to E-Commerce Evolution of Information System Models E.I.S.M The rapid growth of the internet, intranets, extranets, and other interconnected global networks in the 1990s dramatically changed the capabilities of information systems in business. Now, we enjoy a much higher level of: integration of system functions across applications, greater connectivity across both similar and dissimilar system components, and the ability to reallocate critical computing tasks such as data storage, processing and presentation to take maximum advantage of business and strategic opportunities The internet and related technologies and applications have changed the way businesses operate and people work, and how information systems support business processes, decision-making, and competitive advantage.
E-business the use of Internet technologies to work and empower business processes, electronic commerce, and enterprise collaboration within a company and with its customers, suppliers, and other business stakeholders. Five Models of the Evolution Of Information System
- Manual Process Model
- Flat-File Systems
- The Database Model
- ERP (Enterprise Resources Planning) Systems
- REA (Resources,Events, and Agents) Model Manual Process Model Is the oldest and most traditional form of accounting systems. Includes order-taking, warehousing, materials, manufacturing goods for sale, shipping goods to customers, and placing orders with vendors. Involves the physical task of record keeping. Manual systems constitute the physical events, resources, and personnel that characterize many business processes The Flat-File Model It is often called legacy systems. Large mainframe systems that were implemented in the late 1960s through the 1980s. Individual data files are not related to other files. Also known as a stand-alone application Three Significant Problems in the Flat-File Environment: Data Storage - an efficient information system captures and stores data only once and makes this single source available to all users who need it. Data Updating - the organizations have a great deal of data stored in files that require periodic updating to reflect changes. Currency of Information - in contrast to the problem of performing multiple updates is the problem of failing to update all the user files affected by a change in status. If update information is not properly disseminated, the change will not be reflected in some user's data, resulting in decisions based on outdated information. The tables of the database are linked via common attributes called PRIMARY KEYS (PR) and embedded FOREIGN KEYS (FR)
An accounting framework for modeling an organization's critical resources, events, and agents (REA) and the relationships between them. Once specified, both accounting and non-accounting data about these phenomena can be identified, captured, and stored in a relational database. The REA model was proposed in 1982 as a theoretical model for accounting Advances in database technology have focused renewed attention on REA as a practical alternative to the classic accounting framework. Resources Economic resources are the assets of the organization. An account receivable is an artifact record used simply to store and transmit data. Because it is not an essential element of the system, it does not need to be included in the database. Events Events transactions interaction of Economic events are phenomena that affect changes in resources. Economic events are the critical information elements of the accounting system and should be captured in a highly detailed form to provide a rich database. Agents Economic agents are individuals and departments that participate in an economic event. They are parties both inside and outside the organization with discretionary power to use or dispose of economic resources. The REA model requires that accounting phenomena be characterized in a manner consistent with the development of multiple user views. Business data must not be preformatted or artificially constrained and should reflect all relevant aspects of the underlying economic events. As such, REA procedures and databases are structured around events rather than accounting artifacts such as journals, ledgers, charts of accounts, and double-entry accounting. Under the REA model , business organizations prepare financial statements directly from the event database. Traditional accounting records including journals, ledgers, and charts of accounts do not exist as physical files or tables under the REA model. For financial reporting purposes, views or images of traditional accounting records are constructed from the event tables. For example, the Cost-of-Goods-Sold control account balance is (Quant sold * Unit cost) summed for all transactions for the period If necessary or desired, journal entries and general ledger amounts can also be derived from these event tables. Enterprise Resource Planning Systems
ERP is the process used by companies to integrate almost all the aspects of and factors of a company from HR to Finances. ERP has played a great role on the industry level as well as in small businesses. Or it can be a system that optimizes the flow of information, materials and cash in an organization. This introducing processing options which allow for software behavior flexibility and user- defined fields which provide companies with an extensive opportunity to categorize and innovate techniques; the recognized leaders in the market are SAP, ORACLE, J.D. EDWARDS & CO., and PEOPLE OF INC Some common ERP modules include: Asset Management Financial Accounting Human Resources Industry-Specific Solutions Plant Maintenance Production Planning Quality Management Sales And Distribution Inventory Management
