Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg.

Information System)

Information Systems Analysis and Design

UNIT 1: Introduction to Information

System Environment
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

Introduction

An information system is an organized collection of people, information technology,

information resources, and all coordinated activities to achieve certain objectives in the business
organization. Conceptually, an information system may or may not be computerized. For instance, in a
manual inventory process system, the set of the inventory bookkeepers, calculators, and pencil and
paper are the information system. Practically, nowadays computers have become an indispensable
element of contemporary information systems. As information technology is essential and vital to
business, the development of an information system in the organization becomes crucial for the success
of the organization. This textbook disseminates theories and methodologies of the process of
information systems development.

Information systems analysis and design refers to the process of completing an information system
development project. Information systems development covers a wide range of technical areas
including business process modeling, data modeling and database design, networking design,
computer programming, and computer hardware and operating systems. Each of these areas discusses
its subjects of information systems in addition to information systems development, and has rich and
unique material to learn. For instance, the theories of data modeling and database design can
be applied to data resource management and business intelligence in addition to information
systems development. The fact is that it is impossible for a single course or a single textbook to fully
cover all these areas. Practically, the information systems analysis and design course and its textbook
focus on two components: management of information systems development and business process
modeling, and touch on other technical areas very briefly when delivering the monolithic concept of
information systems development.
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

Learning Outcomes

 Identify the problems in legacy systems.

 Identify the various types of Information systems and list their
characteristics.
 Recognize the various two types of processing modes.
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

Activating Prior Learning

 Study the Picture Below. Can you Define the types of Information System?

 Can you tell the components of Accounting Information System as seen in the
picture below?
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

Topic 1: Information Systems

Systems development is systematic process which includes phases such as planning, analysis, design,
deployment, and maintenance.

Systems Analysis

It is a process of collecting and interpreting facts, identifying the problems, and decomposition of a
system into its components.

System analysis is conducted for the purpose of studying a system or its parts in order to identify its
objectives. It is a problem-solving technique that improves the system and ensures that all the
components of the system work efficiently to accomplish their purpose. Analysis specifies what the
system should do.

Systems Design

It is a process of planning a new business system or replacing an existing system by defining its
components or modules to satisfy the specific requirements. Before planning, you need to understand
the old system thoroughly and determine how computers can best be used in order to operate
efficiently.

System Design focuses on how to accomplish the objective of the system. System Analysis and Design
(SAD) mainly focuses on Systems, Process, and Technology.

What is a System?

The word System is derived from Greek word Systema, which means an organized relationship between
any set of components to achieve some common cause or objective.

A system is “an orderly grouping of interdependent components linked together according to a plan to
achieve a specific goal.”

Constraints of a System

A system must have three basic constraints:

 A system must have some structure and behavior which is designed to achieve a predefined
objective.
 Interconnectivity and interdependence must exist among the system components.
 The objectives of the organization have a higher priority than the objectives of its subsystems.

For example, traffic management system, payroll system, automatic library system, human resources
information system.
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

Properties of a System

A system has the following properties:

 Organization

Organization implies structure and order. It is the arrangement of components that helps to achieve
predetermined objectives.

 Interaction

It is defined by the manner in which the components operate with each other.

For example, in an organization, purchasing department must interact with production department and
payroll with personnel department.

 Interdependence

Interdependence means how the components of a system depend on one another. For proper
functioning, the components are coordinated and linked together according to a specified plan. The
output of one subsystem is the required by other subsystem as input.

 Integration

Integration is concerned with how a system component are connected together. It means that the parts
of the system work together within the system even if each part performs a unique function.

 Central Objective

The objective of system must be central. It may be real or stated. It is not uncommon for an organization
to state an objective and operate to achieve another.

The users must know the main objective of a computer application early in the analysis for a successful
design and conversion.
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

Elements of a System

The following diagram shows the elements of a system.

Outputs and Inputs

The main aim of a system is to produce an output which is useful for its user. Inputs are the information
that enters into the system for processing. Output is the outcome of processing.

Processor(s)

The processor is the element of a system that involves the actual transformation of input into output. It
is the operational component of a system. Processors may modify the input either totally or partially,
depending on the output specification. As the output specifications change, so does the processing. In
some cases, input is also modified to enable the processor for handling the transformation.

Control

The control element guides the system. It is the decision–making subsystem that controls the pattern of
activities governing input, processing, and output. The behavior of a computer System is controlled by
the Operating System and software. In order to keep system in balance, what and how much input is
needed is determined by Output Specifications.
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

Feedback

Feedback provides the control in a dynamic system. Positive feedback is routine in nature that
encourages the performance of the system. Negative feedback is informational in nature that provides
the controller with information for action.

Environment

The environment is the “supersystem” within which an organization operates. It is the source of external
elements that strike on the system. It determines how a system must function. For example, vendors
and competitors of organization’s environment, may provide constraints that affect the actual
performance of the business.

Boundaries and Interface

A system should be defined by its boundaries. Boundaries are the limits that identify its components,
processes, and interrelationship when it interfaces with another system. Each system has boundaries
that determine its sphere of influence and control. The knowledge of the boundaries of a given system is
crucial in determining the nature of its interface with other systems for successful design.
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

Topic 2: Types of Information System

Components of information systems

An information system is essentially made up of five components hardware, software, database,
network and people. These five components integrate to perform input, process, output, feedback and
control.

Hardware consists of input/output device, processor, operating system and media devices. Software
consists of various programs and procedures. Database consists of data organized in the required
structure. Network consists of hubs, communication media and network devices. People consist of
device operators, network administrators and system specialist.

Information processing consists of input; data process, data storage, output and control. During input
stage data instructions are fed to the systems which during process stage are worked upon by software
programs and other queries. During output stage, data is presented in structured format and reports.

Classification of Information System

In any given organization information system can be classified based on the usage of the information.
Therefore, an information system in an organization can be divided into operations support system and
management support system.

 Operations support system

In an organization, data input is done by the end user which is processed to generate information
products i.e. reports, which are utilized by internal and or external users. Such a system is called
operation support system.

The purpose of the operation support system is to facilitate business transaction, control production,
support internal as well as external communication and update organization central database. The
operation support system is further divided into a transaction-processing system, processing control
system and enterprise collaboration system.

 Transaction Processing System (TPS)

In manufacturing organization, there are several types of transaction across department. Typical
organizational departments are Sales, Account, Finance, Plant, Engineering, Human Resource and
Marketing. Across which following transaction may occur sales order, sales return, cash receipts, credit
sales; credit slips, material accounting, inventory management, depreciation accounting, etc.
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

These transactions can be categorized into batch transaction processing, single transaction processing
and real time transaction processing.

 Process Control System

In a manufacturing organization, certain decisions are made by a computer system without any manual
intervention. In this type of system, critical information is fed to the system on a real-time basis thereby
enabling process control. This kind of systems is referred as process control systems.

 Enterprise Collaboration System

In recent times, there is more stress on team effort or collaboration across different functional teams. A
system which enables collaborative effort by improving communication and sharing of data is referred
to as an enterprise collaboration system.

 Management Support System

Managers require precise information in a specific format to undertake an organizational decision. A

system which facilitates an efficient decision making process for managers is called management
support system.

Management support systems are essentially categorized as management information system, decision
support system, expert system and accounting information system.

Management information system provides information to manager facilitating the routine decision-
making process. Decision support system provides information to manager facilitating specific issue
related solution.

 Decision Support Systems

A decision support system (DSS) is an interactive computer-based information system that, like MIS, also
serves at the management level of an organization. However, in contrast to MIS, it processes
information to support the decision making process of managers. It provides middle managers with the
information that enables them to make intelligent decisions. A decision support system in a bank, for
example, enable a manager to analyze the changing trends in deposits and loans in order to ascertain
the yearly targets.

Decision support systems are designed for every manager to execute a specific managerial task or
problem. Generally, they help managers to make semi-structured decisions, the solution to which can be
arrived at logically. However, sometimes, they can also help in taking complex decisions. To support
such decisions, they use information generated by OASs and TPSs.

Decision support systems have more analytical power as compared to other information systems. They
employ a wide variety of decision models to analyze data or summarize vast amount of data into a form
(usually form of tables or charts) that make the comparison and analysis of data easier for managers.
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

They provide interactive environment so that the users could work with them directly, add or change
data as per their requirements, and ask new questions.

 Executive Support Systems

An executive support system (ESS) – an extension of MIS – is a computer based information system that
helps in decision making at the top-level of an organization. The decisions taken with the help of
executive support system are non-routine decisions that effect the entire organization and, thus, require
judgement and sight.

As compared to DSSs, ESSs offer more general computing capabilities, better telecommunications and
efficient display options. They use the advanced graphics software to display the critical information in
the form of charts or graphs that help senior executives to solve a wide range of problems. To make
effective decisions, they use summarized internal data from MIS and DSS as well as data from external
sources about events like new tax laws, new competitors, etc. They filter, compress, and track data of
high importance and make it available to the strategic-level managers.

Executive support systems help to monitor performance, track activities of competitors, identify
opportunities, and forecast trends. They also assist senior managers in answering the following
question:

• What business should we do?

• How are our competitors doing the business?

• Which units can be sold and which new units are to be bought?

 Expert Systems

In artificial intelligence, an expert system is a computer system that emulates the decision-making ability
of a human expert. Expert systems are designed to solve complex problems by reasoning through bodies
of knowledge, represented mainly as if–then rules rather than through conventional procedural code.

 Communication and Collaboration Systems

A premise for the cooperation in Teams and organizations across space and time borders. The modules
goal is to show and explain to students the broad spectrum of communication and collaboration
elements. The module contains lecture, case study elaboration and application of recent
Communication and Collaboration Technologies such as social media. Participants should get an
overview about recent technologies of communication and collaboration systems and adapt theoretical,
social and organizational knowledge about such systems. Furthermore, the requirements for the
management processes of distributed cooperation systems need to be understood. Therefore, the
module introduces technical aspects of communication infrastructures, establishes topics from a
communication theoretical point of view and addresses the challenges of virtual teamwork. Distributed
systems are discussed from a management perspectice (CSCW, collaborative systems for distributed
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

teams). Additionally, basic knowledge about technical structures of distributes systems are addressed
(e.g. ISO/OSI model).

Further Classification

An information system can be categorized based upon activity into strategic planning system, tactical
information system and operational information system.
Course Code: PRE 2 Pre-requisite/s: AE20 (Acctg. Information System)

Summary
Information systems transform raw data into useful information through three basic
activities: input, processing, and output. From a business perspective, an information system creates
economic value for the firm as an organizational and management solution, based on information
technology, to a challenge posed by the environment. The information system is part of a series of
value-adding activities for acquiring, transforming, and distributing information to improve management
decision making, enhance organizational performance, and, ultimately, increase firm profitability.

Reflection

 What is the purpose of Information System?

 What did you learn about the topic? Explain

References
Whitten & Bentley (2007) System Analysis and Design Methods - 7th Edition.

https://www.academia.edu/8787830/Whitten_and_Bentley_2007_System_Analysis_and_Desig
n_Methods_7th_Edition