What is an Information System
A system is a group of procedures and different elements that work together in order complete a task. Now we can add on to this to get information systems. Information systems are much the same, there are elements and procedures to work to complete a task. The difference is information systems are used to generate information for the users on a need basis. Information systems manage and process data as soon as they are created, they can also be used for long term planning or just the day to day work. While systems are great and can ease your life, they are static, which means someone will need to change the systems when new needs arise. This is called system development. While it could be costly, there really is a need for system development since things change constantly. Whether there are new laws or a new policy within the company.
Some information systems are meant to be used by all levels of employees while others are specifically designed to handle the needs of employees with certain responsibilities. As one goes higher up the company ladder, it can be seen how responsibilities may increase relative to position. It is for this reason that some information systems are designed to hone in on the needs of certain level employees. At the ground level, employees generally make job related decisions that are based on “on-the-job” input without having to consider how those decisions will effect other departments or employees in other positions. These usually involve transaction systems such as point-of-sales or warehouse systems that record stock and inventory.
Operational managers such as supervisors or foremen use separate information systems designed to meet short term goals and gains. They might use systems that show the productivity of employees or the cost effectiveness of certain changes they’ve made in production. Middle managers are a step up from this and use information systems that house a broader range of information to make more tactical decisions. These decisions are usually aimed at a farther sighted goal than those of Operational managers and often need more intelligence pulled from data systems in order to reach these objectives.
Middle managers might be more concerned with how to improve yearly gains and may use systems that will deliver more detailed information about specific locations of factories or retailers in certain states. Executive managers think in terms of the future and the direction of a company related to their peer corporations. They make very strategic decisions to ensure the survival of the entire company as a whole in relation to the economy and competition. The systems they use might include the stock market, which tracks the progress of alot of businesses. Because the needs of each position increases, the decision support systems needed to make well judged verdicts must increase as well.
TYPES OF INFORMATION SYSTEMS
There are many different types of information systems. Even though there are many systems, the four that will be elaborated are the following: transaction processing systems, customer relationship management systems, business intelligence systems, and knowledge management systems. Transaction processing systems are used for processing and outputting functions for the core operations of a business, storage, and data collection. The purpose of this system is to collect input and then produce the output.
An online air ticket booking system is an example of a TPS. Customer relationship management systems are usually used by business owners for sales and marketing efforts. This system helps businesses keep record of customer activities, purchasing trends, product defects, and customer inquiries. CRM systems also allow business partners to communicate with each other which contributes to a successful business. Business intelligence systems are essential for businesses to predict sale patterns for their company. BIS are essential in collecting data from different companies.
Financial Institutions are an example of this type of system; it is used to create credit risk models that study the number and amount of lending given to the sectors. Knowledge management systems organize the knowledge within an organization and then share it. KMS brings innovation, top quality performance, integration, and knowledge to an organization. Small and large enterprises can benefit from this type of system. Business owners view this system as a valuable attribute to their company because it provides quick responses to their customers and partner questions.
Office and User Productivity Support Systems
There are systems implemented in many institutions (ex. Universities, hospitals, corporations) that help users in everyday tasks including the creation of documents and other content through applications as well as communication. These systems are one of the oldest and simple types of systems that have been created when institutions started going towards paperless solutions. Document Processing Systems are support systems that allow users to create documents with the use of software and/or hardware. Often these systems include software applications such as Microsoft Office or Apple iWork and hardware such as scanners.
Document Management Systems are systems that both store and organize the documents. The goal of these types of systems is to make documents easier to find by placing them in one centralized repository. A Content Management System is essentially the same as a Document Management System except that it also manages multimedia documents such as pictures or videos rather. Although they may seem simple because we use them everyday, Document Processing and Document/Content Management Systems can be very complicated when taken to a larger scale because it includes not only the organization and creation of a database, but also ensuring the security of the documents within the system.
Another common type of Office and User Productivity Support Systems include communication systems. These can be any sort of software that allows users within an institution to communicate. Common communication software includes email, videoconferences, and messaging.
Transaction Processing Systems
Any computer application that helps process business transactions is called a transaction processing system (TPS). Order entry systems, payroll systems, and accounting systems are three main types of TPSs. Order entry systems simply record order data. For example, when purchasing an item from Wal-Mart’s website, your order is recorded by an automated order entry system. The type of order entry system Walmart’s website uses is an e-commerce system due to the fact the order was made over the internet.
There are also order entry systems that work with physical transactions, called point-of-sale systems. For instance, if someone were to purchase a product at Wal-Mart (not online), the order would be processed at a register using a point-of-sale system. A payroll system is another type of a TPS that is used by almost every employer. Payroll systems basically organize, compute, and issue paychecks. These systems automatically take out the correct amount of taxes and other deductions from an employee’s pay.
Accounting systems are a type of TPS that records financial transactions. Three types of widely used accounting systems are accounts payable systems, accounts receivable systems, and general ledger systems. Accounts payable systems keep track of how much a seller owes a buyer, while accounts receivable systems keep track of how much a buyer owes a consumer. General ledger systems are systems capable of putting together account data to form financial reports.
An enterprise system is an integrated information system that is made to support business processes, information flows, reporting, and data analytics in complex organizations. Its main function is to coordinate all of the major processes of an organization and integrate those processes into the different departments of the organization. Some of these application processes may include sales and distribution, financial accounting, investment management, materials management, production planning, maintenance, and human resources. Because it is integrates, it allows data to be used for several purposes. There is a central database that collects all the data from all of the applications, and then in return it feeds out the data as output to all of the processes of the organization. So, once data is given by one processes, then all the processes have access to that data. An example would be a university or college that uses an enterprise system to manage all student records, enrollment applications and acceptance, finances, human resources, etc.
Many companies are starting to implement enterprise systems because it is an easy way to combine the core functions of the company with technological advancements. It is an easy way because the enterprise system is a single software architecture that fuses all the core processes of a business to function as one unit. The synchronized functioning of the processes makes it easier and more efficient to for multiple departments to work together and it is also helpful for managers as they can better oversee multiple tasks and project at one time.
Enterprise systems were created to eliminate the problem of the shattering of important information in large businesses. Most companies have so much information stored in so many different areas that when information needs to be retrieved, it becomes a hassle. If a company’s information is shattered and cannot be retrieved when needed if retrieved at all, it will eventually reflect into their sales. An enterprise system is a single database which gets information from all of a company’s activities. Whenever someone changes information in any area, the system will then update it throughout and make the information up to date. The amount of productivity and speed can really increase when a company begins using this system. This also gives them the ability to be organized and function on a larger level. Inside of an enterprise system there are modules. Some modules are used universally by all companies and other (such as human resources) are specific to each company.
Configuration tables are also part of what makes an enterprise system. These are how a company can make their system unique to their business. They can change certain parts of the system such as not only having an inventory, but instead having inventory accounting. Enterprise systems help with logic and organization in companies and provide a better “flow” in how things are run.
“Data mining” sounds like a kind of unnerving term or a violation of privacy, but it isn’t really. It just refers to any “process of analyzing data from different perspectives and summarizing it into useful information” — in other words, taking a lot of data about anything, including public information, and analyzing it with software to a useful end that can’t easily be reached by a human alone. It’s using computers to sift through a large amount of data that a human being can’t analyze. For example, supermarkets regularly have computers analyze massive amounts of data on which items are more or less frequently purchased in which locations so that they can stock stores with items that will be purchased by more individuals in that store’s location. They also might change the prices of items slightly on certain days when those items are more commonly purchased, and they stock items close to one another that are often purchased together.
There are many other uses of data mining besides just these (which are examples that have actually occurred, not just hypothetical ones), but in general, data mining is most frequently used via corporations to cut costs or increase revenues.
Computer-Aided Design and Computer-Aided Manufacturing
Computer-aided design/computer-aided manufacturing (CAD/CAM) are computer systems that are used to design and manufacture products. CAD is used to assist in the creation, modification, analysis, or optimization of a design. It is used to increase the productivity, improve the quality, improve communications through documentation, and to create a database for manufacturing. It is used in many applications such as automotive, shipbuilding, and aerospace industries, industrial and architectural design, prosthetics, and many more. Also, CAD is used to produce computer animation for special effects in movies, advertising and technical manuals.
CAM is used to control machine tools and related machinery in the manufacturing of work pieces.CAM can also assist in all operations of a manufacturing plant, including planning, management, transportation and storage. The primary purpose of CAM is to create a faster production process and components. Compared to manual machines, there are several advantages to using CAM such as speed (CAM is faster because machining speeds are higher), greater accuracy, greater consistency (every finished product is the same), efficiency (production can run 24 hours a day, 7 days a week) and sophistication (CAM is able to machine difficult shapes, eg tracks on a circuit boards). After the model is generated in CAD, it can be input into CAM software which then controls the machine tool.
Decision Support Systems
A specific type of support system often used by businesses is known as a decision support system. Decision support systems were originally being researched as early as the 1960’s, but began interacting with users in the middle and late 1980’s. A decision support system enables a user to make decisions on demand, and interactively. These systems use both internal and external data to provide a user the tools to organize the decision-making information. The concept of decision-making is to primarily allow the user needed information to make particular decisions. The system is not necessarily making the decision for a user; it is simply retrieving relevant information that will assist them in their decision.
DSS systems are primarily used to uncover unstructured information regarding issues middle and executive managers may face. Once the data is retrieved from either internal or external sources, the system allows human-friendly access to retrieve the data. Examples of prospective data gathered would be: inventories of information, comparative sales figures, and projective revenue. This system is indeed relatively simple to use through its interaction with the user of the system. DSS systems also allow great flexibility for the program, appealing to various ranges of information. The system can also adapt to the user’s environment as well.