Transcript Lecture 2

Lecture 2
(a) Four Information System Levels and
(b) Six major types of Information Systems
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What is an Information System?
Another definition of it:
• Information
System
(IS):
Interrelated
components working together to collect,
process, store and disseminate information to
support decision making, co-ordination, control,
analysis, and visualisation in an organisation.
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Information Systems: More than computers
• Using information systems effectively requires
an
understanding
of
the
organization,
management, and information technology
shaping the systems. All information systems
can be described as organizational and
mangement solutions to challenges posed by
the environment.
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Contemporary Approaches to
Information Systems
• Technical Approach:
– Computer Science
– Operations Research
– Management Science
• Behavioural Approach:
– Sociology
– Political Science
– Psychology
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Socio-technical Approach
• Another approach is the Socio-technical
approach: In a socio-technical perspective, the
performance of a system is optimized when both
the technology and the organization mutually
adjusted to one another until a satisfactory fit is
obtained.
• This is a combination of technical and
behavioural approach. This is an ideal approach
as an organization has many facets that pull on
both the technical and behavioural.
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I.S. Terms
• Computer-Based Information Systems (CBIS):
Information systems that rely on computer
hardware and software for processing and
disseminating information.
• Formal System: System resting on accepted and
fixed definitions of data and procedures,
operating with predefined rules.
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Organisations and SOPs
• Organisation is comprised of people,
structure, operating procedures, politics
and culture.
• Standard Operating Procedures (SOPs):
Formal rules for accomplishing tasks that
have been developed to cope with
expected situations. Many firms’ SOPs
are incorporated their IS.
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DIFFERENT KINDS OF SYSTEMS
Four main types of information systems
serve different organisation levels:
1.Operational-level systems
2.Knowledge-level systems
3.Management-level systems
4.Strategic-level systems
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• Operational-level systems support operational
managers by keeping track of the elementary
activities and transactions of the organisation,
such as sales, receipts, cash deposits, payroll,
credit decisions, and flow of materials in a
factory. The principal purpose of systems at this
level is to answer routine questions and to track
the flow of transactions through the organisation.
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• Knowledge-level systems support knowledge
and data workers in an organisation. The
purpose of knowledge-level systems is to help
the business firm integrate new knowledge into
the business and to help the organisation control
the flow of paperwork.
Knowledge-level
systems, especially in the form of workstations
and office systems, are the fastest growing
applications in business today.
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• Management-level systems are designed to
serve the monitoring, controlling, decisionmaking, and administrative activities of middle
managers.
• Strategic-level systems help senior management
tackle and address strategic issues and longterm trends, both in the firm and in the external
environment.
Their principal concern is
matching changes in the external environment
with existing organisational capability.
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SIX MAJOR TYPES OF SYSTEMS
In this section, we describe the specific categories of
systems serving each organisational level and their
value to the organisation. The organisation has:
• Executive Support System (ESS) at the Strategic
Level; (Note, ESS is also called Executive Information
System – EIS).
• Management Information Systems (MIS) and
Decision-Support System (DSS) at the Management
Level;
• Knowledge Work Systems (KWS) and Office
Automation Systems (OAS) at the Knowledge Level.
• Transaction Processing Systems (TPS) is found at the
Operational Level.
(see diagram to illustrate the levels above)
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This diagram shows where the 6 major
types of information systems fall into the four
system levels:
Strategic
Level
ESS
MIS
KWS
DSS
OAS
TPS
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Management
Level
Knowledge
Level
Operational
Level
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CBIS
Data Inputs
Processing
ESS
Aggregate
data; Graphics;
external, internal
simulations,
interactive
Projections,
responses
queries
DSS
Low-volume
data; Interactive;
analytic models
simulations,
analysis
Special reports, Professionals,
decision analysis; staff managers
responses
to
queries
MIS
Summary transaction Routine
reports, Summary
and Middle
data;
high-volume simple
models; exception reports
managers
data; simple models
low-level analysis
KWS
Design
specifications;
knowledge base
Modeling;
simulations
Models; graphics
Professionals;
technical staff
OAS
Documents,
schedules
Document
management;
scheduling;
communication
Documents;
schedules; mail
Clerical workers
TPS
Transactions; events
Sorting;
listing; Detailed reports; Operations
merging; updating lists; summaries
personnel;
supervisors
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Information
Outputs
Users
Senior
to
Managers
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TPS
• Transaction processing systems (TPS) are
the basic business systems that serve the
operational level of the organisation. A
transaction processing system is a
computerised system that performs and
records the daily routine transactions
necessary to the conduct of the business.
Examples are sales order entry, hotel
reservation systems, payroll, employee
record keeping, and shipping.
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KWS
• Knowledge Work Systems (KWS) and Office
Automation
Systems
(OAS)
serve
the
information needs at the knowledge level of the
organisation.
Knowledge work systems aid
knowledge workers, whereas office automation
systems primarily aid data workers (although
they are also used extensively by knowledge
workers. In general, knowledge workers are
people who hold formal university degrees and
who are often members of a recognised
profession like engineers, doctors, lawyers, and
scientists
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OAS
• Office automation systems (OAS) are
information
technology
applications
designed to increase the productivity of
data workers in the office by supporting
the co-ordinating and communicating
activities of the typical office.
Word
processing, desktop publishing and
document imaging systems are OAS
applications.
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MIS
• Management Information Systems (MIS):
Information systems at the management
level of an organization that serve the
functions of planning, controlling, and
decision making by providing routine
summary and exception reports.
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MIS
• Management information systems (MIS) serve the
management level of the organisation, providing
managers with reports and, in some cases, with on-line
access to the organisation’s current performance and
historical records. Typically, they are oriented almost
exclusively to internal, not environmental or external
events. MIS primarily serve the functions of planning,
controlling, and decision making at the management
level. Generally, they are dependent on underlying
transaction processing systems for their data. MIS
summarise and report on the basic operations of the
company. The basic transaction data from TPS are
compressed and are usually presented in long reports
that are produced on a regular schedule.
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• Characteristics of Management Information Systems:
• MIS support structured and semi-structured decisions at
the operational and management control levels.
However, they are also useful for planning purposes of
senior management staff.
• MIS are generally reporting and control oriented. They
are designed to report on existing operations and
therefore to help provide day-to-day control of
operations.
• MIS reply on existing corporate data and data flows.
• MIS have little analytical capability.
• MIS generally aid in decision making using past and
present data.
• MIS are relatively inflexible.
• MIS have an internal rather than an external orientation.
• Information requirements are known and stable.
• MIS often require a lengthy analysis and design process.
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DSS
• Decision
Support
Systems
(DSS):
Information systems at the management
level of an organization that combine data
and sophisticated analytical models to
support semi-structured and unstructured
decision making.
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DSS
• Decision-support systems (DSS) also serve the
management level of the organisation. DSS
help managers make decisions that are semistructured, unique, or rapidly changing, and not
easily specified in advance. DSS have to be
responsible enough to run several times a day in
order to correspond to changing conditions.
While DSS use internal information from TPS
and MIS, they often bring in information from
external sources, such as current stock prices or
product prices of competitors
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DSS
• Characteristics of Decision-Support Systems
• DSS offer users flexibility, adaptability, and a
quick response.
• DSS allow users to initiate and control the input
and output.
• DSS operate with little or no assistance from
professional programmers.
• DSS provide support for decisions and problems
whose solutions cannot be specified in advance.
• DSS use sophisticated analysis and modelling
tools.
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ESS
• Executive Support Systems (ESS):
Information systems at the strategic level
of an organization designed to address
unstructured decision making through
advanced graphics and communications.
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