Piyush Mistry piyush.consulting@gmail.

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Course for ITM-Session-1

Information System (IS) refers to a system of people, data records and activities that process the data and information in an organization.
Devices used to aid computation for thousands of years. Using one-to-one correspondence with our fingers Mechanical Calculators Log tables

The word "calculus" comes from the Latin word for pebble

The first use of the word "computer" was recorded in 1613, referring to a person who carried out calculations, or computations, and the word continued to be used in that sense until the middle of the 20th century. From the end of the 19th century onwards though, the word began to take on its more familiar meaning, describing a machine that carries out computations.

Computer based information system refers to the specific application software that is used to store data records in a computer system and automates some of the information processing activities of the organization.

An CIS is a set of interrelated components that collect or retrieve, process, store, and distribute information to support decision making and control in an organization. Information systems can also be used to analyze problems, visualize complex subjects, and create new products.

Input, processing, and output are the three activities in an information system that produce the information an organization needs. Input captures or collects raw data from within the organization or from its external environment. Processing converts this raw input into a meaningful form. Output transfers the processed information to the people who will use it or to the activities for which it will be used. Information is data, or raw facts, shaped into useful form for humans.

Using IS effectively requires an understanding of the organization, management, and information technology shaping the systems. An information system creates value for the firm as an organizational and management solution to challenges posed by the environment.

Organization

Senior management makes long-range strategic decisions and ensures the firm's financial performance. Middle management carries out the plans of senior management and operational management monitors the firm's daily activities. Knowledge workers such as engineers and scientists design products and create and distribute new knowledge for the organization. Data workers such as secretaries process the organization's paperwork. Production or service workers produce the products or services.

Management
Mgt. perceives business challenges and they set org. strategies to respond to it, they provide resources to overcome and succeed. Mgt. should enable managers to create new products/services, adopt newer techniques and ideas. Mgt. should encourage change Mgt. should impose change and new process with an iron hand

Technology
A firm's information technology (IT) infrastructure is a technology platform or foundation on which a firm can build its information systems. IT infrastructure consists of:

Computer hardware: The physical equipment and computing devices used for input, storage, processing, output, and telecommunications Computer software: The detailed, preprogrammed instructions that control and coordinate the computer hardware components

Technology (cont.)

Data management software: The software governing the organization of data on physical storage media Networking and telecommunications technology: Hardware and software used to link the various pieces of hardware and transfer data from one physical location to another; a computer network links two or more computers together to share data, such as files, images, sounds, video, or share resources, such as a printer.

Business firms invest heavily in information systems to achieve six strategic business objectives:
1. 2. 3. 4. 5. 6.

Operational excellence New products, services, and business models Customer and supplier intimacy Improved decision making Competitive advantage

Survival

Operational excellence:

Using IS achieve efficiency, productivity IS enables the org. to improved changes in business practices and management behavior E.g. Wal-Mart has IS that enables its suppliers to monitor the inventory and ship the item.

New products, services, and business models: A business model describes how a company produces, delivers, and sells a product or service to create wealth. Information systems and technologies create opportunities for new products, services, and new ways to engage in business. e.g. digital music, videos, e-books, games, apps.

Customer and supplier intimacy Improved communication with and service to customers raises revenues The customer generally stays loyal to the brand if served well. E.g. a hotel maintains the customers preferences. Improved communication with suppliers .The more you engage your supplier he gives vital inputs and lowers costs.

Improved decision making Without accurate and timely information, business managers make decisions based on forecasts, best guesses, and luck, a process that results in over and underproduction of goods, raising costs, and the loss of customers. Real time dashboard enable them to take right decisions rather than guesses.

Competitive advantage: Implementing effective and efficient information systems can allow a company to charge less for superior products, adding up to higher sales and profits than their competitors. Responding to customers and suppliers real time adds us to your benefits and profits. E.g. Dell

Survival: Information systems can also be a necessity of doing business. A necessity may be driven by industry-level changes, as in the implementation of ATMs in the retail banking industry. A necessity may also be driven by governmental regulations, such as federal or state statutes requiring a business to retain data and report specific information.

Information systems are transforming business and the visible results of this include the increased use of cell phones and wireless telecommunications devices. A massive shift toward online news and information, booming e-commerce and Internet advertising, and new federal security and accounting laws that address issues raised by the exponential growth of digital information. E-commerce is the part of e-business that deals with the buying and selling of goods and services over the Internet. It encompasses activities supporting those market transactions, such as advertising, marketing, customer support, security, delivery, and payment. The Internet has also drastically reduced the costs of businesses operating on a global scale.

These changes have led to the emergence of the digital firm, a firm in which: Most of the firm's significant business relationships with customers, suppliers, and employees are digitally enabled and mediated. Core business processes, or logically related business tasks, are accomplished through digital networks. Key corporate assets (intellectual property, core competencies, and financial and human assets) are managed through digital means Business responses to changes in their environment are enhanced through digital communications, allowing for time shifting (business being conducted 24x7) and space shifting (business being conducted globally or beyond traditional geographic boundaries).

Information systems are essential for conducting day-to-day business as well as achieving strategic business objectives. The ability of a firm to use IT is becoming intertwined with the firm's ability to implement corporate strategy. Some firms, such as eBay, Amazon, and E*Trade, would be nonexistent without information systems. Some service industries such as finance, insurance, and BPO/KPO would not operate without information systems.

There are various types of information systems, critical to most information systems are information technologies, which are typically designed to enable humans to perform tasks for which the human brain is not well suited. e.g. Handling large amounts of information, performing complex calculations, and controlling many simultaneous processes.

Types of IS :
Transaction processing Management information Decision support or Business Intelligence Expert or Artificial Intelligence Executive support Office Automation Enterprise Systems-CRM/ERP

TPS automate the handling of data about business activities or transactions, which can be thought of as simple, discrete events in the life of an organization. Data about each transaction are captured, transactions are verified and accepted or rejected and validated transactions are stored for later aggregation. The goal of TPS development is to improve transaction processing by speeding it up, using fewer people, improving efficiency and accuracy, integrating it with other organizational information systems or providing information not previously available. TPS are basic business systems that serve the operational level of the organization by recording the daily routine transactions required to conduct business, such as payroll and sales receipts.

MIS is a subset of the overall internal controls of a business covering the application of people, documents, technologies, and procedures by management accountants to solve business problems such as costing a product, service or a business-wide strategy. MIS distinct from regular information systems in that they are used to analyze other information systems applied in operational activities in the organization. MIS serve middle managers' interests by providing current and historical performance information to aid in planning, controlling, and decision making at the management level.

DSS or Business Intelligence (BI) systems are a specific class of computerized information systems that supports business and organizational decision-making activities. DSS helps managers with non-routine decisions that are unique, rapidly changing, and not easily specified in advance. DSS are more analytical than MIS, using a variety of models to analyze internal and external data or condense large amounts of data for analysis.. Typical information that a decision support application might gather and present would be: an inventory of all of your current information assets, comparative sales figures between one week and the next, projected revenue figures based on new product sales assumptions

An expert system is software that attempts to reproduce the performance of one or more human experts, most commonly in a specific problem domain, and is a traditional application and/or subfield of artificial intelligence. A wide variety of methods can be used to simulate the performance of the expert Typically as an aid to human workers or a supplement to some information system.

ESS provide a generalized computing and communications environment that help senior managers address strategic issues and identify long-term trends in the firm and its environment. ESS address non-routine decisions requiring judgment, evaluation, and insight because there is no agreed-on procedure for arriving at a solution. ESS present graphs and data from many internal and external sources through an interface that is easy for senior managers to use. Often the information is delivered to senior executives through a portal, which uses a Web interface to present integrated personalized business content.

Office automation refers to the varied computer machinery and software used to digitally create, collect, store, manipulate, and relay office information needed for accomplishing basic tasks and goals. Raw data storage, electronic transfer, and the management of electronic business information comprise the basic activities of an office automation system. Office automation helps in optimizing or automating existing office procedures. The backbone of office automation is a LAN, which allows users to transmit data, mail and even voice across the network. All office functions, including dictation, typing, filing, copying, fax, Telex, microfilm and records management, telephone and telephone switchboard operations, fall into this category. Office automation was a popular term in the 1970s and 1980s as the desktop computer exploded onto the scene.

The various types of systems in the organization have interdependencies. TPS are major producers of information that is required by many other systems in the firm, which, in turn, produce information for other systems. These different types of systems are loosely coupled in most business firms, but increasingly firms are using new technologies to integrate information that resides in many different systems.

Enterprise Resource Planning

Supply chain management

Customer relationship management Knowledge management

Operating system

MS Office (word, excel, Power point, outlook)

Browsers