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February 2011Master of Computer Application (MCA) Semester 4MC0076 Management Information Systems 4 Credits (Book ID: B0901)Assignment Set

2 (60 Marks)

Answer all Questions Each question carries TEN marks

Q.1 list and discuss the different level of organization by which informationneeded.

Major Types of Systems

Executive Support Systems (ESS)

Decision Support Systems (DSS)

Management Information Systems (MIS)

Transaction Processing Systems (TPS)

Management Information System (MIS) An MIS provides managers with information and support for effective

decision making, and provides feedback on daily operations.

MIS provides information to the users in the form of reports

Output, or reports, is usually generated through accumulation oftransaction processing data.

MIS is an integrated collection of subsystems, which are typically

organized along functional lines within an organization.

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Essentials of Management Information Systems

INTEGRATING FUNCTIONS AND BUSINESS PROCESSES

Traditional View of the Systems

Transaction Processing Systems (TPS): Basic business systems that serve the operational level A computerized system that performs and records the daily routine

transactions necessary to the conduct of the business

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Types of TPS Systems

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System Architecture: Transaction Pro

Major functions of systems: Budgeting, general ledger, billing, cost accounting

Major application systems: General ledger, accounts receivable, accounts payable, budgeting, funds

management systems Financing and Accounting Systems

Major functions of systems: Sales management, market research, promotion, pricing, new products

Major application systems: Sales order info system, market research system, pricing system Manufacturing and Production Systems

Major functions of systems:

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Scheduling, purchasing, shipping, receiving, engineering, operationsMajor application systems:

Materials resource planning systems, purchase order control systems,

engineering systems, quality control systems

Human Resource SystemsMajor functions of systems:

Personnel records, benefits, compensation, labor relations, trainingMajor application systems:

Payroll, employee records, benefit systems, career path systems,personnel training systems

Human Resource Systems

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Payroll TPS

System Example: Payroll System (TPS

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Overview of Inventory Systems

Management Information System (MIS):Management level

Inputs: High volume data Processing: Simple models Outputs: Summary reports Users: Middle managers Structured and semi-structured decisions

Report control oriented Past and present data Internal orientation

Lengthy design process

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Management Information System (MIS

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System Architecture: Management Information

Management Information System

Creates reports managers can useto make routine business decisions

Scheduled reports Key-indicator reports Exception reports

Ad hoc (demand) reports Drill-down reports

Scheduled Reports

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Produced periodically, or on a schedule (daily, weekly, monthly).

Key-Indicator ReportSummarizes the previous days critical activities and typically available at the beginningof each day.

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Demand ReportGives certain information at a managers request.

Exception Report

Automatically produced when a situation is unusual or requires management action

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Drill Down ReportsProvide detailed data about a situation.

Decision Support System (DSS):Management level

Inputs: Low volume data Processing: Interactive Outputs: Decision analysis Users: Professionals, staff

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Decision Support System (DSS)

Four Types of Models

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Decision Support System (DSS

Top level management

Designed to the individual

Ties CEO to all levels

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Very expensive to keep up

Extensive support staff

Strategic level

Inputs: Aggregate data

Processing: Interactive

Outputs: Projections

Users: Senior managers

Example: 5-year operating plan

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Types of Information Systems

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INTERRELATIONSHIPS AMONG SYSTEMS

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Q.2 Explain the control issues in management information systems.

Control is the process through which manager assures that actual activities are according tostandards leading to achieving of common goals. The control process consists measurement ofprogress, achieving of common goals and detects the deviations if any in time and takescorrectiveaction before things go beyond control. also detects goes beyond . The basic steps in control

process are should in the following figure.

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Actual vsStandard

Corrective

Establish Measurestandard of performance actionperformance

Corrective action

Control Process

Why do we need to control management information system?Information systems operate in real world situations which are always changing and there arelots of problems. Information systems are vulnerable to various threats and abuses. Some of thepoints are memory, communications links, microwave signal, telephone lines etc.

Security ControlThe resources of information systems like hardware, software, and data, need to be protectedpreferably by build in control to assure their quality and security.

Types of Security Control:

1. Administrative control2. information systems control

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3. procedural control

4. physical facility control

Administrative controlSystems analysts are actually responsible for designing and implementing but these peopleneed the help of the top management in executing the control measure. Top executives provideleadership in setting the control policy. Without their full support, the control system cannotachieve its goal. In addition to this , managers must be involved in functions such as effecting acontrol policy, selecting and assigning personnel, fixing responsibilities, preparing jobdescription, setting standards, preparing a strategic information plan and acquiring adequateinsurance.

Information system controlInformation system control assures the accuracy, validity and proprietary of information systemactivities. Control must be there to ensure proper data entry processing techniques, storage

methods and information output. Accordingly management information system control aredesigned to see or monitor and maintain quality, security of the input process, output andstorage activities of an information system.

Input ControlAs we know whatever we give to computer the computer processes that and returns the resultto us. Because of this very fact, there is a need to control the data entry process. The types ofinputcontrol arei.Transaction Codes : Before any transaction can eb input into the system, a specific codeshould be assigned to it. This aids in its authorization.ii. Forms : a source document or screen forms should be used to inlput data and such formsmust adhere to certain rules.

iii. Verification: Source document prepared by one clerk can be verified by another clerk toimprove accuracy.iv. Controltotals:Data entry and other system activities are frequently monitored by the use of control total.For example, record count is a control total that consist of counting the totalnumber of source documents or other input records and compare them at other stage of dataentry. If totals do not match, then a mistake is indicated.v. Check digit: These are used for checking important codes such as customer number toverify the correctness.vi. Labels : It contains data such as file name, and date of creation so that a check can bemade that correct file is used for processing.

vii. Character and field checking : Characters are checked for proper mode numeric,alphabetic, alphanumeric fields to see if they are filled in properly.

Processing ControlInput and processing data are so interrelated that we can take them as first line of defense.Oncedata is fed into the computer, controls are embedded in various computer programs to help,detect not only input errors but also processing errors. Processing controls are included tocheck arithmetic calculations and logical operations. They are also used to ensure that data are

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not lost or do not go unprocessed. Processing control is further divided into hardware andsoftware control.I) Hardware Control They are built in the hardware itself to verify the accuracy of processing.

2) Software control they are designed to assure that right data is being processed. They arelike operating systems or other software checks. Checking internal file labels at the beginningand at the end of the magnetic tape and disk files is an example of software control. Yet anothersoftware control is the establishment of check points during the processing of the program. Theyalso help to build an audit trial.

Output Control These are developed to ensure that processed information is correct,complete and is transmitted to authorized user in a timely manner. The output control are mostlyof same kind as input control eg. Output documents and reports are thoroughly and visuallyverified by computer personnel and they are properly logged and identified with rout slips.Control total at output stage are compared with control total at both input and processing level.A hard copy of listing is maintained for evidence. The end user are contracted for feedbackabout the quality of information.

Storage Control : Control responsibility of files of computer programs and databases isgiven to librarian or database administrator. They are responsible for maintaining and controllingaccess to the information. The databases and files are protected from unauthorized users areaccidental users .This can be achieved with the help of security monitor. The method includesassigning the account code., password and other identification codes. A list of authorized usersis provided to computer system with details such as type of information they are authorized toretrieve or receive from it.

Procedural Control These methods provide maximum security to operation of theinformation system. Some of the examples areSeparation of duties: Each activity related to computerized information system like systemsdevelopment, computer operation and control of data and program files, is assigned to different

groups of persons. System analysts and programmers are not allowed to files are maintained inthe library and the responsibility is given to DBA. Finally, a production control system maymonitor the progress of information processing, data entry and the quality of input data.Standard procedures are developed and maintained in manual and built in software help displayso that every one knows what to do. It promotes uniformity software help display so that everyone knows what to do. It promotes uniformity and minimize the chance of error and fraud. Itshould be kept up-to-date so that correct processing of each activity is made possible.Authorization requirements the formal review must take place before authorization is given ongetting a request for some system development, changes or system conversion. For example, ifprogram change is done by maintenance programmer , it should be approved by the affecteddepartments manger as well as form the manager of programming and manager of computeroperation. Thus conversion to new hardware and software, installation of newly developed

information system, or change to existing program is subject to a formal notification so thataccuracy and integrity of information processing operation can be maintained

Physical Facility ControlPhysical facility control are methods that protect physical facilities and their contents from lossand destruction. Computer centers are prone to many hazards such as accidents, thefts, fire,natural sabotage, vandalization, unauthorized used, industrial espionage, destructions etc..Therefore physical safeguards and various control procedures are required to protect thehardware, software and vital data resources of computer using organization.

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Physical protection control Many type of controlling techniques such as one inwhich only authorized personnel are allowed to access to the computer centre exist today. Suchtechniques include identification badges of information services, personnels , electronic door

locks, security alarm, security policy, closed circuit TV and other detection systems firedetection and extinguishing system., fire proof storage vaults for the protection of files,emergency power systems, humidity temperature and dust control etc., are installed to protectthe computer centre.Telecommunication Controls The telecommunication processor and control

software play a vital role in control of data communication activity . Data can eb transmitted incodedFrom and it is decoded in the computer centre itself. The process is called as encryption.

Computer Failure Controls Computers can fail for several reasons like powerFailures, electronic circuitry malfunctions, mechanical malfunctions of peripheral equipment andHidden programming errors. To protect from these, failure precaution any measure withautomatic and remote maintenance capabilities may be required. Adequate electrical supply,

humidity control, air conditioning and fire prevention standards must also be set. Computeroperators must be trained and supervised carefully. Fault tolerant computer systems may beinstalled to ensure against computer failure. Insurance Adequate insurance coverage shouldbe secured to protect the computerized information system using business firms. Financiallosses are very huge in amount . Many insurance companies offer special computer securitypolicies. These include insurance against fire, natural disasters, vandalism and theft etc.Insurance for data process error or omissions, and insurance for the bonding of informationservices personnel as a protection against fraud. The amount of such insurance should beenough so as to replace affected computer equipment and facilities. Insuranceis also available to cover the cost of reconstructing data and program files.

Q.3 Discuss the function for manager.

Basic functions

Management operates through various functions, often classified as planning, organizing,

staffing, leading/directing, controlling/monitoring and Motivation.

Planning: Deciding what needs to happen in the future (today, next week, next month, next

year, over the next 5 years, etc.) and generating plan for action.

Organizing: (Implementation) making optimum use of the resources required to enable the

successful carrying out of plans. Staffing: Job Analyzing, recruitment, and hiring individuals for appropriate jobs.

Leading/Directing: Determining what needs to be done in a situation and getting people to

do it.

Controlling/Monitoring: Checking progress against plans.

Motivation : Motivation is also a kind of basic function of management, because without

motivation, employees cannot work effectively. If motivation doesn't take place in an

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organization, then employees may not contribute to the other functions (which are usually set

by top level management).

Basic roles

Interpersonal: roles that involve coordination and interaction with employees.

Informational: roles that involve handling, sharing, and analyzing information.

Decisional: roles that require decision-making.

Management skills

Technical: used for specialized knowledge required for work.

Political: used to build a power base and establish connections.

Conceptual: used to analyze complex situations.

Interpersonal: used to communicate, motivate, mentor and delegate. Diagnostic: ability to visualize most appropriate response to a situation .

Formation of the business policy

The mission of the business is the most obvious purposewhich may be, for example, to

make soap.

The vision of the business reflects its aspirations and specifies its intended direction or future

destination.

The objective of the business refers to the ends or activity at which a certain task is aimed. The business's policy is a guide that stipulates rules, regulations and objectives, and may be

used in the managers' decision-making. It must be flexible and easily interpreted andunderstood by all employees.

The business's strategy refers to the coordinated plan of action that it is going to take, as

well as the resources that it will use, to realize its vision and long-term objectives. It is a

guideline to managers, stipulating how they ought to allocate and utilize the factors ofproduction to the business's advantage. Initially, it could help the managers decide on what

type of business they want to form.

Implementation of policies and strategies

All policies and strategies must be discussed with all managerial personnel and staff.

Managers must understand where and how they can implement their policies and strategies.

A plan of action must be devised for each department.

Policies and strategies must be reviewed regularly.

Contingency plans must be devised in case the environment changes.

Assessments of progress ought to be carried out regularly by top-level managers.

A good environment and team spirit is required within the business.

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The missions, objectives, strengths and weaknesses of each department must be analyzed to

determine their roles in achieving the business's mission.

The forecasting method develops a reliable picture of the business's future environment.

A planning unit must be created to ensure that all plans are consistent and that policies andstrategies are aimed at achieving the same mission and objectives.

All policies must be discussed with all managerial personnel and staff that is required in the

execution of any departmental policy.

Organizational change is strategically achieved through the implementation of the eight-step

plan of action established by John P. Kotter: Increase urgency, get the vision right,communicate the buy-in, empower action, create short-term wins, don't let up, and make

change stick.

Policies and strategies in the planning process

They give mid- and lower-level managers a good idea of the future plans for eachdepartment in an organization.

A framework is created whereby plans and decisions are made.

Mid- and lower-level management may add their own plans to the business's strategic ones.

Levels of management

In organizations, there are generally three different levels of managers: first-level managers,middle-level managers, and top-level managers. These levels of managers are classified in a

hierarchy of importance and authority, and are also arranged by the different types of

management tasks that each role does. In many organizations, the number of managers in every

level resembles a pyramid, in which the first-level has many more managers than middle-leveland top-level managers, respectively. Each management level is explained below in

specifications of their different responsibilities and likely job titles.

Top-Level Managers

Typically consist of Board of Directors, President, Vice President, Chief Executive Officers, etc.

These individuals are mainly responsible for controlling and overseeing all the departments inthe organization. They develop goals, strategic plans, and policies for the company, as well as

make many decisions on the direction of the business. In addition, top-level managers play asignificant role in the mobilization of outside resources and are for the most part responsible for

the shareholders and general public.

According to Lawrence S. Kleiman, the following skills are needed at the top managerial level.

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Broadening their understanding of how factors such as competition, world economies,

politics, and social trends influence the effectiveness of the organization.

Middle-Level Managers

Typically consist of General Managers, Branch Managers, Department Managers, etc. These

individuals are mainly responsible to the top management for the functioning of theirdepartment. They devote more time to organizational and directional functions. Their roles can

be emphasized as executing plans of the organization in conformance with the company's

policies and the objectives of the top management, they define and discuss information and

policies from top management to lower management, and most importantly they inspire andprovide guidance to lower level managers towards better performance. Some of their functions

are as follows:

Designing and implementing effective group and intergroup work and information systems. Defining and monitoring group-level performance indicators.

Diagnosing and resolving problems within and among work groups.

Designing and implementing reward systems that support cooperative behavior.

First-Level Managers

Typically consist of Supervisors, Section Officers, Foreman, etc. These individuals focus moreon the controlling and direction of management functions. For instance, they assign tasks and

jobs to employees, guide and supervise employees on day-to-day activities, look after the

quantity and quality of the production of the company, make recommendations, suggestions, and

communicate employee problems to the higher level above, etc. In this level, managers are the"image builders" of the company considering they are the only ones who have direct contact with

employees.

Basic supervision.

Motivation.

Career planning.

Performance feedback.

Q.4 a. describe business plan Vs MIS plan

Many corporations that installed the most advanced computer technology have found that

the new capabilities have also forced them to make further changes--at a pace faster than

desired. A fast, sophisticated tool can let people recognize, understand and fix problems,

but it can also create other problems. Corporations, some observers say, must implementan enterprise model capable of managing change and forecasting the impact of anticipated

problems on a business.

MIS goals and objectives:It is necessary to develop the goals and objectives for the MIS

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which will support the business goals. The MIS goals and objectives will consider

management philosophy, policy constraints, business risks, internal and externalenvironment of the organization and the business.The goals and the objectives of the MIS would be so stated that they can be measured.

The typical statements of the goals are as under:

Provide on-line information on the stocks, markets and the accounts balances. The query processing should not exceed more than three seconds. The focus of the system will be on the end user computing and access facilities.

Information support will be the first in the strategic areas of management.Table differentiating between Business Plan versus MIS Plan as below:

Business Plan MIS Plan

Business goals and objectives. Management information system, objectivesconsistent to the business goals and objectives.

Business plan and strategy Information strategy for the business plan

implementation playing a supportive role.

Strategy planning and decisions. Architecture of the Management Information system to

support decisions.

Management Plan for execution and

control.

System development schedule, matching the plan

execution

Operation plan for the execution. Hardware and software plan for the procurement andthe implementation.

Such statements of the goals and objectives enable the designer to set the direction and

design implementation strategies for the MIS.

Strategy for the plan achievement: The designer has to take a number of strategic decisions

for the achievement of the MIS goals and objectives. They are:

a. Development strategy: An online, a batch, a real time.

b. System Development Strategy: An approach to the system development Operational versus Functional; Accounting versus Analysis; Database versus

Conventional Approach; Distributed versus Decentralized processing; oneDatabase versus Multiple database SSAD vs. OOT.

c. Resource for System Development: In-house versus external, customizeddevelopment versus the use of packages.

b. What are the different classes of information

http://www.openlearningworld.com/olw/courses/books/Fundamentals%20of%20MIS/DEVELOPMENT%20OF%20MIS/MIS%20Plan%20is%20Linked%20to%20the%20Business%20Plan.htmlhttp://www.openlearningworld.com/olw/courses/books/Fundamentals%20of%20MIS/DEVELOPMENT%20OF%20MIS/MIS%20Plan%20is%20Linked%20to%20the%20Business%20Plan.htmlhttp://www.openlearningworld.com/olw/courses/books/Fundamentals%20of%20MIS/DEVELOPMENT%20OF%20MIS/MIS%20Plan%20is%20Linked%20to%20the%20Business%20Plan.htmlhttp://www.openlearningworld.com/olw/courses/books/Fundamentals%20of%20MIS/DEVELOPMENT%20OF%20MIS/MIS%20Plan%20is%20Linked%20to%20the%20Business%20Plan.htmlhttp://www.openlearningworld.com/olw/courses/books/Fundamentals%20of%20MIS/DEVELOPMENT%20OF%20MIS/MIS%20Plan%20is%20Linked%20to%20the%20Business%20Plan.html

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In order to obtain useful information you need to identify what kind of information you

need. Different kinds of information can be found in different types of resources. The kind of

information you need will then determine which resource is the most appropriate.

Types of InformationDifferent sorts of questions require different types of information to answer. In order togather evidence to support an argument, you first need an idea of what types of informationare suitable. You can gain a sense of which types of information are appropriate for your

project by answering the questions in this section.

Contents

What is my assignment and what are my opportunities for research?

In order to research effectively you need a solid understanding of what sort of evidence

your assignment requires and what is available.

Which academic disciplines does my research touch upon?

Research papers are usually written with the goal of contributing to the dialogue of aparticular discipline. To do so, a paper must follow the standards of research and evidence

for that discipline.

Description for different types of Information as follows:

Primary, Secondary and Tertiary Information: Most information is generally divided into

three main categories: Primary ,Secondary and Tertiary.

Primary Information: Original material that has not been interpreted or analysied.

Examples: Statistics, Research articles, Blogs, Websites

Secondary Material: Created from primary material, interpretating original material.

Examples: Texbooks, Review articles

Tertiary Material: Acts as a tool in understanding and locating information. Examples:

Databases, Subject Gateways, Dictionaries, Bibliographies

Different types of Information Systems:

http://gethelp.library.upenn.edu/PORT/infotypes/tocintro.htmlhttp://gethelp.library.upenn.edu/PORT/infotypes/communities.htmlhttp://www.ucd.ie/library/students/information_skills/glossary.html#phttp://www.ucd.ie/library/students/information_skills/glossary.html#shttp://www.ucd.ie/library/students/information_skills/glossary.html#Tertiaryhttp://www.ucd.ie/library/students/information_skills/glossary.html#Tertiaryhttp://www.ucd.ie/library/students/information_skills/glossary.html#shttp://www.ucd.ie/library/students/information_skills/glossary.html#phttp://gethelp.library.upenn.edu/PORT/infotypes/communities.htmlhttp://gethelp.library.upenn.edu/PORT/infotypes/tocintro.html

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Information systems are constantly changing and evolving as technology continues

to grow. Very importantly the information systems described below are not mutually

exclusive and some (especially Expert Systems, Management Information Systems and

Executive Information Systems are can be seen as a subset of Decision Support Systems).

However these examples are not the only overlaps and the divions of these information

systems will change over time.

At present there are five main types:

Transaction Processing Systems (TPS)

Decision Support Systems (DSS)

Expert Information Systems (EIS)

Management Information Systems (MIS) Office Automation Systems (OAS)

Q.5 Explain the various cognitive style as identified by James McKinney and Peter Keen.

The success of a management information system in supporting a decision maker dependsheavily on certain characteristics of the individual. Some of these are differences in the attitudes

of system users; others concern individual cognitive behavior.

Much of the research regarding individual differences has been summarized by Robert Zmud.

Individuals who tend to access information to a greater degree exhibit a low degree ofdogmatism, a higher risk-taking propensity, an internal locus of control, and low tolerance for

ambiguity.

It has been recognized that people do not necessarily understand their own information

requirements. This underscores the need for MIS specialists to bring these requirements to lightand the importance of using techniques such as prototyping of information systems.

Decision making is a cognitive activity, as are other phenomena such as learning or

understanding language. In general, human cognition is human information processing. People

display distinct cognitive styles in the ways they gather and evaluate information. In their

analysis of how managers minds work, James McKinney and Peter Keen have classified theinformation related modes of thought along two dimensions: information gathering and

information evaluation.

The information-gathering dimension focuses on perception, on the way a person organizes the

verbal and visual stimuli he or she encounters. Preceptive individuals bring to bear concepts

("precepts") to filter incoming stimuli; from the framework of these concepts, they look forspecific conformities with or deviations from the concepts they have already formed.Receptive

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decision makers focus on details rather than on a pattern and attempt to form a general picture of

the situation from these details (a characteristic of inductive thinking).

Information evaluation relates to the way an individual brings information to bear in the processof decision making. A systematic (or analytic) decision maker approaches a problem bystructuring it and applying a well-defined method expected to lead to a solution. An intuitive

individual applies heuristics (rules of thumb) and shortcuts and uses trial and error to find a

solution; these people are more willing to go with their "gut feeling" about the problem.McKinney and Keen stress that all of these modes of thought are appropriate in certain

situations, and some combinations of them are particularly fit in certain occupations.

While the importance of individual cognitive style in the design of MIS has been contested, the

fact that significant differences exist among individual decision-making processes should inform

the way systems are designed. In particular, developers of information systems tend to be

systematic individuals and thus tend to assume that the users are (or should be) the same. End-user system development and a number of available packages have addressed the necds of

intuitive (or heuristic) decision making. These systems allow the user to play out a variety of

scenarios; the user is able to identify and test new alternatives. Such systems should not impose apreset processing order, but rather allow the user the freedom to set this order as he or she is

working. It is desirable that the system allow an easy shift back and forth between summarized

and detailed data (needed by receptive individuals). A variety of tabular and graphical outputformats should also be available. Much of this wish list is now fulfilled in well-designed DSS

and EIS.

Individual creativity is the cornerstone of good decision making? Cornerstones, however, do not

houses make, and organizational departures from rational decision making, as we discussed, area frequent reason for the demise of creative problem solving.

Creative thinking offers new approaches to often ill-defined problems that are worth solving. The

creative process requires cultivation, and much of it can be learned. A well-regarded approach to"creativity in business" is described in a book with that title by Michael Ray and Rochelle

Myers. Ray and Myers postulate that creativity consists in learning to release the human poten-

tial present in all of us. James Adams sees the road to individual creativity as a process of

overcoming the following obstacles:

Perceptual blocks: stereotyping, preconceived notions, inability to see a problem from various

viewpoints

Emotional blocks: fear of taking risks, desire for orderliness, lack of a sense of challenge

Cultural blocks: avoidance of fantasizing and ret1ection, feeling bound by tradition, fear of

right-brained thinking (because we have been trained to believe that analytical thinking issuperior to intuitive or qualitative judgments)

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Environmental blocks: lack of support within the organization

Intellectual blocks: lack of information, int1exible use of problem-solving strategies,

inadequate skills in expressing ideas (for example, verbally, mathematically, or visually)

As soon as we have classified obstacles in this fashion, we can identity our principal

inadequacies and deal with them. Finding new associations between ideas underlies creativethinking. Recent analyses indicate that much creative decision making in organizations is

performed or stimulated by groups-from a work team to the chief executives "cabinet."

People in a group are able to bring diverse backgrounds, expertise, and cognitive styles to bearon a problem. It is sometimes said in jest that the camel is a horse designed by a committee; we

may note that the committee seems to have come up with an animal that has contributed

immensely to human civilization. Group work has to be carefully organized; certain individuals

do not perform well in group settings.

Q.6 Bring out the table that indicate the various classes of information

various classes or t y p e s o f i n f o r m a t i o n

For most businesses, there are a variety of requirements for information. Senior managers needinformation to help with their business planning. Middle management need more detailed information

to help them monitor and control business activities. Employees with operational roles needinformation to help them carry out their duties.

As a result, businesses tend to have several "information systems" operating at the same time. Thisrevision note highlights the main categories of information system and provides some examples to helpyou distinguish between them.

The main kinds of information systems in business are described briefly below:

InformationSystem

Description

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ExecutiveSupport Systems

An Executive Support System ("ESS") is designed to help senior management makestrategic decisions. It gathers, analyses and summarises the key internal andexternal information used in the business.

A good way to think about an ESS is to imagine the senior management team in anaircraft cockpit - with the instrument panel showing them the status of all the keybusiness activities. ESS typically involve lots of data analysis and modelling toolssuch as "what-if" analysis to help strategic decision-making.

ManagementInformationSystems

A management information system ("MIS") is mainly concerned with internalsources of information. MIS usually take data from the transaction processingsystems (see below) and summarise it into a series of management reports.

MIS reports tend to be used by middle management and operational supervisors.

Decision-SupportSystems

Decision-support systems ("DSS") are specifically designed to help management makedecisions in situations where there is uncertainty about the possible outcomes of

those decisions. DSS comprise tools and techniques to help gather relevantinformation and analyse the options and alternatives. DSS often involves use ofcomplex spreadsheet and databases to create "what-if" models.

KnowledgeManagementSystems

Knowledge Management Systems ("KMS") exist to help businesses create and shareinformation. These are typically used in a business where employees create newknowledge and expertise - which can then be shared by other people in theorganisation to create further commercial opportunities. Good examples includefirms of lawyers, accountants and management consultants.

KMS are built around systems which allow efficient categorisation and distribution ofknowledge. For example, the knowledge itself might be contained in word

processing documents, spreadsheets, PowerPoint presentations. internet pages orwhatever. To share the knowledge, a KMS would use group collaboration systemssuch as an intranet.

TransactionProcessingSystems

As the name implies, Transaction Processing Systems ("TPS") are designed to processroutine transactions efficiently and accurately. A business will have several(sometimes many) TPS; for example:

- Billing systems to send invoices to customers- Systems to calculate the weekly and monthly payroll and tax payments- Production and purchasing systems to calculate raw material requirements- Stock control systems to process all movements into, within and out of thebusiness

OfficeAutomationSystems

Office Automation Systems are systems that try to improve the productivity ofemployees who need to process data and information. Perhaps the best example isthe wide range of software systems that exist to improve the productivity ofemployees working in an office (e.g. Microsoft Office XP) or systems that allowemployees to work from home or whilst on the move.

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