For most businesses, there are a variety of requirements for information.

Senior managers need information to help with their business planning. Middle management need more detailed information to help them monitor and control business activities. Employees with operational roles need information to help them carry out their duties. As a result, businesses tend to have several "information systems" operating at the same time. This revision note highlights the main categories of information system and provides some examples to help you distinguish between them.

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

Executive Support An Executive Support System ("ESS") is designed to help senior management make strategic Systems decisions. It gathers, analyses and summarises the key internal and external information used in the business. A good way to think about an ESS is to imagine the senior management team in an aircraft cockpit - with the instrument panel showing them the status of all the key business activities. ESS typically involve lots of data analysis and modelling tools such as "what-if" analysis to help strategic decision-making. Management Information Systems A management information system ("MIS") is mainly concerned with internal sources of information. MIS usually take data from the transaction processing systems (see below) and summarise it into a series of management reports. MIS reports tend to be used by middle management and operational supervisors. Decision-Support Systems Decision-support systems ("DSS") are specifically designed to help management make decisions in situations where there is uncertainty about the possible outcomes of those decisions. DSS comprise tools and techniques to help gather relevant information and analyse the options and alternatives. DSS often involves use of complex spreadsheet and databases to create "what-if" models. Knowledge Management Systems ("KMS") exist to help businesses create and share information. These are typically used in a business where employees create new knowledge and expertise - which can then be shared by other people in the organisation to create further commercial opportunities. Good examples include firms of lawyers, accountants and management consultants. KMS are built around systems which allow efficient categorisation and distribution of knowledge. For example, the knowledge itself might be contained in word processing documents, spreadsheets, PowerPoint presentations. internet pages or whatever. To share the knowledge, a KMS would use group collaboration systems such as an intranet.

Knowledge Management Systems

Transaction As the name implies, Transaction Processing Systems ("TPS") are designed to process routine Processing Systems 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 the business

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

TYPES OF INFORMATION SYSTEMS

An information system is a collection of hardware, software, data, people and procedures that are designed to generate information that supports the day-to-day, short-range, and long-range activities of users in an organization. Information systems generally are classified into five categories: office information systems, transaction processing systems, management information systems, decision support systems, and expert systems. The following sections present each of these information systems.

1. Office Information Systems

An office information system, or OIS (pronounced oh-eye-ess), is an information system that uses hardware, software and networks to enhance work flow and facilitate communications among employees. Win an office information system, also described as office automation; employees perform tasks electronically using computers and other electronic devices, instead of manually. With an office information system, for example, a registration department might post the class schedule on the Internet and e-mail students when the schedule is updated. In a manual system, the registration department would photocopy the schedule and mail it to each students house.

An office information system supports a range of business office activities such as creating and distributing graphics and/or documents, sending messages, scheduling, and accounting. All levels of users from executive management to nonmanagement employees utilize and benefit from the features of an OIS.

The software an office information system uses to support these activities include word processing, spreadsheets, databases, presentation graphics, e-mail, Web browsers, Web page authoring, personal information management, and groupware. Office information systems use communications technology such as voice mail, facsimile (fax), videoconferencing, and electronic data interchange (EDI) for the electronic exchange of text, graphics, audio, and video. An office information system also uses a variety of hardware, including computers equipped with modems, video cameras, speakers, and microphones; scanners; and fax machines.

2. Transaction Processing Systems

A transaction processing system (TPS) is an information system that captures and processes data generated during an organizations day-to-day transactions. A transaction is a business activity such as a deposit, payment, order or reservation.

Clerical staff typically perform the activities associated with transaction processing, which include the following:

1.

Recording a business activity such as a students registration, a customers order, an employees timecard or a clients payment.

2.

Confirming an action or triggering a response, such as printing a students schedule, sending a thank-you note to a customer, generating an employees paycheck or issuing a receipt to a client.

3.

Maintaining data, which involves adding new data, changing existing data, or removing unwanted data.

Transaction processing systems were among the first computerized systems developed to process business data a function originally called data processing. Usually, the TPS computerized an existing manual system to allow for faster processing, reduced clerical costs and improved customer service.

The first transaction processing systems usually used batch processing. With batch processing, transaction data is collected over a period of time and all transactions are processed later, as a group. As

computers became more powerful, system developers built online transaction processing systems. With online transaction processing (OLTP) the computer processes transactions as they are entered. When you register for classes, your school probably uses OLTP. The registration administrative assistant enters your desired schedule and the computer immediately prints your statement of classes. The invoices, however, often are printed using batch processing, meaning all student invoices are printed and mailed at a later date.

Today, most transaction processing systems use online transaction processing. Some routine processing tasks such as calculating paychecks or printing invoices, however, are performed more effectively on a batch basis. For these activities, many organizations still use batch processing techniques.

3. Management Information Systems

While computers were ideal for routine transaction processing, managers soon realized that the computers capability of performing rapid calculations and data comparisons could produce meaningful information for management. Management information systems thus evolved out of transaction processing systems. A management information system, or MIS (pronounced em-eye-ess), is an information system that generates accurate, timely and organized information so managers and other users can make decisions, solve problems, supervise activities, and track progress. Because it generates reports on a regular basis, a management information system sometimes is called a management reporting system (MRS).

Management information systems often are integrated with transaction processing systems. To process a sales order, for example, the transaction processing system records the sale, updates the customers account balance, and makes a deduction from inventory. Using this information, the related management information system can produce reports that recap daily sales activities; list customers with past due account balances; graph slow or fast selling products; and highlight inventory items that need reordering. A management information system focuses on generating information that management and other users need to perform their jobs.

An MIS generates three basic types of information: detailed, summary and exception. Detailed information typically confirms transaction processing activities. A Detailed Order Report is an example of a detail report. Summary information consolidates data into a format that an individual can review quickly and easily. To help synopsize information, a summary report typically contains totals, tables, or graphs. An Inventory Summary Report is an example of a summary report.

Exception information filters data to report information that is outside of a normal condition. These conditions, called the exception criteria, define the range of what is considered normal activity or status. An example of an exception report is an Inventory Exception Report is an Inventory Exception Report that notifies the purchasing department of items it needs to reorder. Exception reports help managers save time because they do not have to search through a detailed report for exceptions. Instead, an exception report brings exceptions to the managers attention in an easily identifiable form. Exception reports thus help them focus on situations that require immediate decisions or actions.

4. Decision Support Systems

Transaction processing and management information systems provide information on a regular basis. Frequently, however, users need information not provided in these reports to help them make decisions. A sales manager, for example, might need to determine how high to set yearly sales quotas based on increased sales and lowered product costs. Decision support systems help provide information to support such decisions.

A decision support system (DSS) is an information system designed to help users reach a decision when a decision-making situation arises. A variety of DSSs exist to help with a range of decisions.

A decision support system uses data from internal and/or external sources.

Internal sources of data might include sales, manufacturing, inventory, or financial data from an organizations database. Data from external sources could include interest rates, population trends, and costs of new housing construction or raw material pricing. Users of a DSS, often managers, can manipulate the data used in the DSS to help with decisions.

Some decision support systems include query language, statistical analysis capabilities, spreadsheets, and graphics that help you extract data and evaluate the results. Some decision support systems also include capabilities that allow you to create a model of the factors affecting a decision. A simple model for determining the best product price, for example, would include factors for the expected sales volume at each price level. With the model, you can ask what-if questions by changing one or more of the factors and viewing the projected results. Many people use application software packages to perform DSS functions. Using spreadsheet software, for example, you can complete simple modeling tasks or what-if scenarios.

A special type of DSS, called an executive information system (EIS), is designed to support the information needs of executive management. Information in an EIS is presented in charts and tables that show trends, ratios, and other managerial statistics. Because executives usually focus on strategic issues, EISs rely on external data sources such as the Dow Jones News/Retrieval service or the Internet. These external data sources can provide current information on interest rates, commodity prices, and other leading economic indicators.

To store all the necessary decision-making data, DSSs or EISs often use extremely large databases, called data warehouses. A data warehouse stores and manages the data required to analyze historical and current business circumstances.

5. Expert Systems

An expert system is an information system that captures and stores the knowledge of human experts and then imitates human reasoning and decision-making processes for those who have less expertise. Expert systems are composed of two main components: a knowledge base and inference rules. A knowledge base is the combined subject knowledge and experiences of the human experts. The inference rules are a set of logical judgments applied to the knowledge base each time a user describes a situation to the expert system.

Although expert systems can help decision-making at any level in an organization, nonmanagement employees are the primary users who utilize them to help with job-related decisions. Expert systems also successfully have resolved such diverse problems as diagnosing illnesses, searching for oil and making soup.

Expert systems are one part of an exciting branch of computer science called artificial intelligence. Artificial intelligence (AI) is the application of human intelligence to computers. AI technology can sense your actions and, based on logical assumptions and prior experience, will take the appropriate action to complete the task. AI has a variety of capabilities, including speech recognition, logical reasoning, and creative responses.

Experts predict that AI eventually will be incorporated into most computer systems and many individual software applications. Many word processing programs already include speech recognition.

Integrated Information Systems

With todays sophisticated hardware, software and communications technologies, it often is difficult to classify a system as belonging uniquely to one of the five information system types discussed. Much of todays application software supports transaction processing and generates management information. Other applications provide transaction processing, management information, and decision support. Although expert systems still operate primarily as separate systems, organizations increasingly are consolidating their information needs into a single, integrated information system.

ROLE OF MIS

Management information system, or MIS, is a managerial decision-making tool. A company uses it in all of its business operations and processes. As the management is in complete know of everything transpiring in the company, it leverages on this advantageous position. Using it, a company is able to record and document all facts pertaining to its procedures and methodologies. The basic intent is to manage and control all of the companys employees and material through MIS.

1. Significance
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Using an MIS, an organization is able to establish its hierarchical structure and work-flow charts. Every employee in the organization knows the employees he has authority over and to whom he is responsible for work. The work then progresses without glitches. The companys operating and procedures are listed by an MIS. The preparation of audits also gets simplified.

IMPORTANCE Management information system is an integrated set of component or entities that interact to achieve a particulars function, objective or goal. Therefore it is a computer based system that provides information for decisions making on planning, organizing and controlling the operation of the sub-system of the firm and provides a synergistic organization in the process. The component of an information system includes. a hardware which is used for input/output process and storage of data, software used to process data and also to instruct the hand-ware component, data bases which is the location in the system where all the organization data will be automated and procedures which is a set of documents that explain the structure of that management information system. There are various driving factors of management information system for example:Technological revolutions in all sectors make modern managers to need to have access to large amount of selective information for the complex tasks and decisions. The lifespan of most product has continued getting shorter and shorter and therefore the challenge to the manager is to design product that will take a longer shelf life and in order to do

this, the manager must be able to keep abreast of the factors that influences the organization product and services thus, management information system come in hardy in supporting the process. There are huge amount of information available to todays manager and this had therefore meant that managers are increasingly relying on management information system to access the exploding information. Management information services helps manager to access relevant, accurate, up-to-date information which is the more sure way of making accurate decisions. It also helps in automation and incorporation of research and management science techniques into the overall management information system for example probability theory. The management information services are capable of taking advantage of the computational ability of the company like processing, storage capacity among others. Based on this relevancy, management information system should be installed and upgraded in various organizations since todays managers need them to access information for managerial decision making and also management functions.

MIS - Organization
Management Information Systems (MIS) should be designed, viewing the organization as discussed earlier. MIS design should give due weight age to the human side of the organization and its culture. The task and technology are the physical aspects of the organization which can be ascertained very easily. But culture and people are very difficult to assess from the design point of view. The structure of the five sub-systems should be considered while designing the MIS. MIS design should give reports in line with the organization structure. This means that the main decision makers and the power centers must be recognized in the MIS.

If the organization works on a standardized system where rules, policies, systems and procedures have been laid down, then these become part of the MIS. The processing routines in the MIS incorporate these features as an integral part. This is safe as it has already been approved by the management of the organization. Along with the information, if the decision making responsibilities are also clearly defined and allocated, then the MIS can produce information reports by processing the data and summarizing the results in line with the decision maker's position in the structure.

If the basic model of the organization is modified as a product or a project organization system, then the MIS should focus on the management of product or project where the concerned

manager has a composite responsibility of planning and control of the multiple functions. Besides these functions, he has to know the status of the other support functions.

The information should be such that it highlights the trouble spots and shows the interconnection with the other functions. It must summarize all information relating to the span of control of product or project manager. The MIS should be able to cater to the view of the product or the project manager and also of the top management.

If the organization culture provides sufficient incentive for efficiency and results, the MIS should support this culture by providing such information which will aid the promotion of efficiency. If the culture encourages delegation of power and authority, then the MIS should incorporate the decision making rules in the system.

The organization system is an open system and MIS should be so designed that it highlights the critical business, operational, technological and environmental changes to the concerned level in the organization, so that the action can be taken to correct the situation. The principle of the feed forward control should be extensively used as a design feature to provide a prior warning to the decision maker.

The design of the MIS, in isolation from organizational factors, is destined to fail as it just does not fit into the structure. Since organization systems in the business differ for various reasons such as the leadership style, the management style, culture and group of people as a body and so on, it is difficult to evolve a standard model of the MIS for a business and / or an industry.

MIS plays a very important role in creating organization behavior which in turn sets the goals for achievement. Technology and people decide the organization structure and style of the management.