What is an Information System?

Many organizations work with large amounts of data.

Data are basic values or facts and are organized in a
dataWbase. Many people think of data as synonymous
with information; however, information actually consists
of data that has been organized to help answers
questions and to solve problems. An information system
is defined as the software that helps organize and analyze
data. So, the purpose of an information system is to turn
raw data into useful information that can be used for
decision making in an organization.
Typical Components of Information Systems
While information systems may differ in how they are
used within an organization, they typically contain the
following components:
Hardware: Computer-based information systems use
computer hardware, such as processors, monitors,
keyboard and printers.
Software: These are the programs used to organize,
process and analyze data.
Databases: Information systems work with data,
organized into tables and files.
Network: Different elements need to be connected to
each other, especially if many different people in an
organization use the same information system.
Procedures: These describe how specific data are
processed and analyzed in order to get the answers for
which the information system is designed.
Different Types
The many different types of information systems can be
divided into categories based on where they are used in
the hierarchy of an organization.

Need of IS in organisation.
At the most basic level, an information system (IS) is a set
of components that work together to manage data
processing and storage. Its role is to support the key
aspects of running an organization, such as
communication, record-keeping, decision making, data
analysis and more. Companies use this information to
improve their business operations, make strategic
decisions and gain a competitive edge.
Information systems typically include a combination of
software, hardware and telecommunication networks.
For example, an organization may use customer
relationship management systems to gain a better
understanding of its target audience, acquire new
customers and retain existing clients. This technology
allows companies to gather and analyze sales activity
data, define the exact target group of a marketing
campaign and m
easure customer satisfaction.
The Benefits of Information Systems
Modern technology can significantly boost your
company's performance and productivity. Information
systems are no exception. Organizations worldwide rely
on them to research and develop new ways to generate
revenue, engage customers and streamline time-
consuming tasks.
With an information system, businesses can save time
and money while making smarter decisions. A company's
internal departments, such as marketing and sales, can
communicate better and share information more easily.
Since this technology is automated and uses complex
algorithms, it reduces human error. Furthermore,
employees can focus on the core aspects of a business
rather than spending hours collecting data, filling out
paperwork and doing manual analysis
There are different types of information systems and
each has a different role. Business intelligence (BI)
systems, for instance, can turn data into valuable insights.
This kind of technology allows for faster, more accurate
reporting, better business decisions and more efficient
resource allocation. Another major benefit is data
visualization, which enables analysts to interpret large
amounts of information, predict future events and find
patterns in historical data.
Organizations can also use enterprise resource planning
(ERP) software to collect, manage and analyze data
across different areas, from manufacturing to finance and
accounting. This type of information system consists of
multiple applications that provide a 360-degree view of
business operations. NetSuite ERP, PeopleSoft, Odoo and
Intacct are just a few examples of ERP software.
Like other information systems, ERP provides actionable
insights and helps you decide on the next steps. It also
makes it easier to achieve regulatory compliance,
increase data security and share information between
departments. Additionally, it helps to ensure that all of
your financial records are accurate and up-to-date.
In the long run, ERP software can reduce operational
costs, improve collaboration and boost your revenue.
Nearly half of the companies that implement this system
report major benefits within six months.
At the end of the day, information systems can give you a
competitive advantage and provide the data you need to
make faster, smarter business decisions. Depending on
your needs, you can opt for transaction processing
systems, knowledge management systems, decision
support systems and more. When choosing one, consider
your budget, industry and business size. Look for an
information system that aligns with your goals and can
streamline your day-to-day operations.
characteristics of information
Five characteristics of high quality information are
accuracy, completeness, consistency, uniqueness, and
timeliness.
Information needs to be of high quality to be useful and
accurate. The information that is input into a data base is
presumed to be perfect as well as accurate. The
information that is accessed is deemed reliable. Flaws do
arise with database design but do not let something in
your control, accurate and reliable data, be one of them.
A database design that is accurate and reliable will help
achieve the development of new business ideas as well
as promoting the organizational goals.
Completeness is another attribute of high quality
information. Partial information may as well be
incomplete information because it is only a small part of
the picture. Completeness is as necessary as accuracy
when inputting data into a database.
Consistency is key when entering information into a
database. For example, with a column for a phone
number entry 10 digits is the expected length of the field.
Once the fields have been set in the database, a number
more or less than 10 digits will not be accepted. The
same applies for any field, whether it is an entry that
requires a number, a series of numbers, an address, or a
name, etc. If the fields are not set to a specific limit for
information then consistency is even more important.

Uniqueness is the fourth component of high quality

information. In order to add value to any organization,
information must be unique and distinctive. Information
is a very essential part of any organization and if used
properly can make a company competitive or can keep a
company competitive.
A fifth important aspect of information is timeliness.
New and current data is more valuable to organizations
than old outdated information. Especially now, in this era
of high technological advances, out-of-date information
can keep a company from achieving their goals or from
surviving in a competitive arena. The information does
not necessarily need to be out of date to have effect, it
just needs to not be the most current. Real-time
information is an element of timeliness.
Types of Information Systems
1. Transaction Processing Systems
1.1. A transaction processing system provides a way to
collect, process, store, display modify or cancel
transactions. Most of these systems allow multiple
transactions to take place simultaneously. The data that
this system collects is usually stored in databases which
can be used to produce reports such as billing, wages,
inventory summaries, manufacturing schedules, or check
registers.
2. Management Information Systems
2.1. A management information system is an information
system that uses the data collected by the transaction
processing system and uses this data to create reports in
a way that managers can use it to make routine business
decisions in response to problems. Some of the reports
that this information system creates are summary,
exception and ad hoc reports. All this is done to increase
the efficiency of managerial activity.
3. Decision Support Systems
3.1. A decision support system helps make decisions by
working and analyzing data that can generate statistical
projections and data models. This system gives support
rather than replacing a managers judgement while
improving the quality of a managers decision. A DSS
helps solve problems while using external data.
Operational Control Definition and Explanation
At the operational level, as opposed to the strategic or
tactical levels the authority over normal business
operations is operational control. While operational
control is inclusive of control over how normal business
processes are executed, it is not inclusive of control over
the high-level business priorities or the strategic business
targets.
Operational Control process
In combatant command (command authority)
operational control is inherent and may be delegated
within the command. In the command relationship, the
losing commander will relinquish and the gaining
commander will exercise over these forces must be
specified by the Secretary of Defense, when forces are
transferred between combatant command. The authority
to perform those functions of command over
subordinate forces involving organizing and employing
commands and forces, designating objectives, assigning
tasks, and giving authoritative direction necessary to
accomplish the mission is operational control.

What includes an operational control?

The authoritative direction over all facets of joint training
and military operations that are required to accomplish
missions assigned to the command is included in
operational control. Only through the commanders of
subordinate organizations should operational control be
exercised. This authority is normally exercised through
subordinate joint force commanders and Service and/or
functional component commanders. Complete authority
to organize commands and forces is normally provided by
the operational control in order to employ those forces
as the commander in operational control considers
necessities to accomplish assigned missions. Although,
the authoritative direction for logistics or matters of
administration, internal organization, discipline, or unit
training is not included.
Definition - What does Executive Information System (EIS)
mean?
An executive information system (EIS) is a decision
support system (DSS) used to assist senior executives in
the decision-making process. It does this by providing
easy access to important data needed to achieve
strategic goals in an organization. An EIS normally
features graphical displays on an easy-to-use interface.
Executive information systems can be used in many
different types of organizations to monitor enterprise
performance as well as to identify opportunities and
problems.
MANAGEMENT INFORMATION SYSTEM(MIS
• The MIS is defined as a system based on the
 database of the evolved for the purpose of
providing information to the people in the
organization.
• Management information systems are distinct
from regular information systems in that they are
used to analyze other information systems applied
in operational activities in the organization. MIS
involve three primary resources: technology,
information, and people.
• Management information systems are regarded
to be a subset of the overall internal controls
procedures in a business, which cover the
application of people, documents, technologies,
and procedures used by management accountants
to solve business problems such as costing a
product, service or a business-wide strategy.
Role Of MIS
• The role of MIS in an organization can be
compared to the role of heart in the body.
• The information is the blood and MIS is the
heart. In the body the heart plays the role of
 supplying pure blood to all the elements of the
body including the brain.
• The MIS plays exactly the same role in the
organization.
• The system ensures that an appropriate data is
collected from the various sources, processed, and
sent further to all the needy destinations.
Characteristics of MIS
• Management-oriented: The basic objective of
MIS is to provide information support to the
management in the organization for decision
making.
• Management directed: When MIS is
management-oriented, it should be directed by the
management because it is the management who
tells their needs and requirements more effectively
than anybody else.
• Integrated: It means a comprehensive or
complete view of all the subsystems in the
organization of a company.
• Common database: This is the basic feature of
MIS to achieve the objective of using MIS in
business organizations.
• Computerized: MIS can be used without a
computer. But the use of computers increases the
effectiveness and the efficiency of the system.
• User friendly/Flexibility: An MIS should be
flexible.
• Information as a resource: Information is the
major ingredient of any MIS.
• Components of MIS
• Marketing Research System (MRS)
• Marketing research can be seen as the
systematic and objective search for and analysis of
data and information relevant to the identification
and solution of any problem in the field of
marketing.
Marketing Intelligence System (MIS)
• The process of acquiring and analyzing
information in order to understand the market
(both existing and potential customers); to
determine the current and future needs and
preferences, attitudes and behavior of the market;
and to assess changes in the business environment
that may affect the size and nature of the market in
the future.
• Decision Support System(DSS)
• It improves personal efficiency.
• It expedites problem solving(speed up the
progress of problems solving in an organization).
• It facilitates interpersonal communication
• It promotes learning or training.
• It increases organizational control.
• A decision support system (DSS) is a computer-
based information system that supports business or
organizational decision-making activities. DSSs
serve the management, operations, and planning
levels of an organization and help to make
decisions, which may be rapidly changing and not
easily specified in advance.
 •

Benefits of MIS
• It improves personal efficiency.
• It expedites problem solving(speed up the
progress of problems solving in an organization).
• It facilitates interpersonal communication
 • It promotes learning or training.
• It increases organizational control.
UNIT 4 Strategy and Strategic Moves

Information systems that help seize opportunities are

often called Strategic Information Systems (SISs). They
can be developed from scratch or they can evolve from
an organization's existing ISs.

Competitive advantage is defined as the strategic

advantage one business entity has over its rival entities
within its competitive industry
Eight ways to gain competitive advantage
• reduce costs: This involves reducing your costs
relative to your competition. Some ways you can do
this include lowering the cost of raw materials,
lowering the cost of labor, and increasing
productivity. This is the primary reason why
companies automate production or move production
overseas.
• raise barriers to market entrants: This makes it
more difficult for competitors to get started in your
market. This is often done using "intellectual
property" tools such as patents and copyrights. It can
also be done by making it extremely expensive for
competitors to enter a market, often due to a
massive investment in some technology or other
infrastructure that gives your organization a large
advantage.
• establish high switching costs: This involves
making it costly for your customers to switch to a
competitor. A good example of this is the reluctance
of companies to switch from using one software
package to another because of the time and expense
of training and working out compatibility problems.
• create new products and services: Being the
first to market (first mover) with a new product or
service can draw new customers and help keep
existing customers. One example is eBay, which was
the first major online auction service. Another
example was Visicalc, the first major spreadsheet
application..
• differentiate products or services: People buy
famous brand names even when they cost more than
lesser known brands because they perceive that they
will get a higher quality product. Being able to
differentiate yourself in a positive way from your
competition is a big advantage. A good example of
this is Apple's iPod. Apple has a reputation for great
products.
• enhance products or services: One strategy is to
make your products more enticing to customers by
adding something of value. This can range from
having longer warranty periods, to offering
discounts, to giving rewards to frequent customers.
We can see this all over with things like frequent flier
miles, preferred customer cards, satisfaction
guarantees, etc.
• establish alliances: Businesses can partner with
each other to enhance each others products and/or
services. The text gives the example of combining an
airline, hotel, car rental, and restaurants together to
create a one-stop vacation planning service. You can
see the same type of alliances when you see a
 Starbucks inside a Meijer's, a TCF bank inside a
Jewel, or a fast food or doughnut store inside a gas
station. Amazon provides an online marketplace for
many, many other businesses, including other
booksellers.
• lock in suppliers or buyers: You can do this a
number of different ways. One of the most common
is for large businesses to use their size to negotiate
favorable contracts with suppliers. Wal-Mart is
famous (notorious?) for this. In fact, Wal-Mart's
negotiations with their suppliers has been a major
force in driving jobs out of the U.S. and into China.
product. Some software examples of this are
Microsoft Windows, Microsoft Office, Adobe PDFs,
and Flash animation.

Strategic Information System (SIS)

• A SIS is a computer system that implements
business strategies; They are those systems where
information services resources are applied to
 strategic business opportunities in such a way that
the computer systems affect the organization’s
products and business operations. Strategic
information systems are always systems that are
developed in response to corporate business
initiative.
• SIS are generally differentiated from other BIS
because they are used to seize opportunities rather
than just solve problems. SIS are often used to try to
gain a strategic advantage over rivals, leading to a
competitive advantage in the market
Creating an SIS
To develop an`SIS, toP management must be involved
from initial consideration
• through development and implementation. In
other words, the SIS must part
of the overall organizational strategic plan

advantages of SIS
It pinpoints ways to achieve competitive advantage of
using information
• systems as a strategic weapon.
2) It stimulates the creative use of information systems
technology and
encourages innovation in applying it to the needs of the
organization.
It redeploys financial and human resources to the most
important and
Strategic- information systems projects far the business.
4) It encourages the integration of existing and future
information systems to eliminate information
redundancies and inconsistencies and inefficient use of
information system resources.

Managing Business Risks

• Types of Business Risks
• Physical Risks:
• Location Risks:
 • Human Risks:
• Technology risks
• Priortising human model

Unit 5 Unit 5 Information security

Information security is used to describe the protection

of both computer and non computer equipment,
facilities, data and information from misuse by
unauthorized parties
• Computer security can focus ensuring the
availability and correct operat
• ion of a computer system without concern for
the information stored or processed by, the
computer.
• Need for Information ;Security,
Information systems are needed for:
1) Reduce the risk of systems and organizations ceasing
operations.
2) Maintaining information confidentiality.
3) Ensure the integrity and reliability of data resources.
4) Ensure the uninterrupted availability -of data
resources and online
operations.
5) Ensure compliance with policies and laws regarding
security and privacy.

Principles of Information SecuritY

 • Confidentiality
It means a system must not allow disclosing
information-to anyone who is not authorized to access
it.
Confidentiality is the property of preventing disclosure
unauthorized individuals or systems.
Big government agencies, Such as the Department of
Defence, CIA,
and confidentiality ensures that the public cannot
access the private information.
• In business, confidentiality ensures that –
private information , such as payroll and personnel
 data, is protected from competitors' and Other'
organizations. In the e-Commerce world,
confidentiality ensures that customers' data cannot
be used for malicious or illegal purposes.
– For example a credit card transaction on
the Internet requires the credit card
number to be transmitted from the buyer to 'the
merchant and from the merchant
to transaction processing network. The system
attempts to enforce
confidentiality by encrypting the card number during
transmission, by limiting
the places where it might appear (in databases, log files,
backups, printed receipts
and so on) and by restricting access to the places where
it is stored. If an
unauthorized party obtains the card number in any way,
a breach of
confidentiality has 'occurred.
Integrity
In information security, integrity. means that data
cannot be modified without authority integrity in
databases.
Integrity is violated when an employee accidentally or
with malicious intent deletes important data files, when
4 computer virus infects a computer, when an employee
is able to modify his own salary in a payroll database,
when an unauthorized user vandalizes a website, When
someone is able to cast a very large number of votes in
an online poll and so on.
Availability
Ili ensures that computers and networks are operating,
and authorised users can access the information they
need. It should also ensure quick recovery in case of a
system failure or disaster. In many cases, availability is
the most important aspect for authorised users. If a
system is not accessible to users, the confidentiality
andintegrity aspects cannot be assessed.
Risks and Threats of Information Security

• Hacking:: Hacking is the process of achieving

access to a computer or
Computer network without legal authorization. Hacking
always involves
Some degree of infringement on the privacy of others or
damage to computer based property such, files,web
pages or software.
Sometimes malicious in nature, these break-insmay
cause drainage or disruption to computer systems or
networks. People
with malevolent intent are often referred to as
"crackers"— as in "cracking“
Examples of Common Hacking Tactics
Levels Of Information Needs
• Organisation-Level , Information Requirements
• Database Requirements
• Application-Level InfiiinritiOn Requirements:
1. Social Requirements
2. Technical Requirements
3. Types,of Information Requirements
4. 1) Functional Requireinents: Functional
requirements,should describe all the required
functionality or "system services.. The customer
should provide statement of service. , be clear how
the - system should react to particular inputs and
how a particular system should behave in particular
5. situation.
6. Functional requirements are heavily dependent
upon the type of software, expected users and
the ,type. of system where the 'software is used’
 7. Fol. example, consider a library system in which
there is a single interface provided to multiple -
databases. These • databases are collection of
articles from different libraries
8. 2) Non-Functional Requirements: The non-
functional requirements define 'system properties
'and constraints. Various properties of a system can
be:
9. Reliability, response time.
Information Needs for an Organization
 Information Needs of Top Management
 General Economic Variables, Especially if they
are doing, Business in the Global Market
 Government Acts and Regulations: Depending
 Technological Changes and New Developments
 Competitors in the Market
Information Needs for IndividuaLManager
 3 levels of magerial deciojn in an organisation
Strategic Decision Making: Most activities in 'strategic
management are dedicated mainly to establishing
objectives for whole organization and preparation of
long-range plans for attaining those objectives (e.g.
decision
where to build a new subsidiary).
2) Tactical Decision Making Most activities are
concerned ith implementation of decisions made, at
strategic Oisantroitional letrel:-t;
Operational decision making — main concern is lo
execute specific tasks in most efficiency and
effectively,manner.
3) Operational Decision Making: Main concern is to
execute specific tasks in most efficiency and effectively
manner.
Strategy for Determining Information Needs for
Organisation
 Asking Questions (closed,open
ended,brainstorming)
 Deriving from an Existing Informatidi System
 Synthesis characteristics of utilizing systems
  Critical factor analysis-Several methods have
been 'proposed for implementing a. strategy for
deterMining information requirements. from object
system analysis.
 Process'Analysis:. Process analysis is, simply put,
about “how things are done” or “how things
proceed.” This may concern the analysis of one
concrete process or a complex analysis of all
processes within an organisation.
 Why does an organisation feel the need to
analyse its processes? There are basically three
possible reasons:
 in order to describe the processes (e.g. so as to
be able to set up job descriptions, manuals,
procedural guides or functional specifications in the
development of application software
 Decision analysis
'.Identify and prescribe the decision.
Define the decision algorithm or decision process.
Various
"Methods decision flow charts, decision tables,
and-decision trees can be used-for this.
fine information needed for the decision process
Socio techno analysis-
Studying pattern of social interaction and group
behaviour in current system
DATA FLOW METHODS
 The Data Flow Diagram (DFD) provides a
graphical representation of the flow of data through
a system. It shows logically what information is
exchanged by our system processes and external
interfaces or data stores, but it does not explicitly
show when or in what sequence the information is
exchanged.
ANALYSIS of INFORMATION FOR
DECISION PROCESSES
 "Decision-making is the study of identifying
and choosing alternatives based on the values and
preferences of the decision .
According to George R Terry, "Decision Making is the
selection -based "on certain criteria from two or more
alternative.
Characteristics of Decision-Making
1. Decision is-the choice of the best, course
among alternatives.
2. 2) - Decision is the end process precededi by
deliberation and reasoning
3. 3) Decision-making is a mental process because
the final selection is-made thoughtful consideration
Process of decision making


HERBERT SIMON MODEL
 Decision-making is a process in which the
decision-maker uses to arrive at a decision. The
core of this process is described by Herbert Simon
in a model. He describes the model in three phases
as shown in the figure below:
 Intelligence: raw data collected, processed and
examined, Identifies a problem calling for a
decision.
 Design: inventing, developing and analyzing the
different decision alternatives and testing the
feasibility of implementation. Assess the value of
the decision outcome.
 Choice: select one alternative as a decision,
based on the selection criteria.
 In the intelligence phase, the MIS collects the
data. The data is scanned, examined, checked and
edited. Further, the data is sorted and merged with
other data and computations are made,
summarized and presented. In this process, the
attention of the manager is drawn to all problem
situations by highlighting the significant differences
between the actual and the expected, the budgeted
or the targeted.
 In the design phase, the manager develops a
model of the problem situation on which he can
generate and test the different decision
alternatives, he then further moves into phase of
selection called as choice.
 In the phase of choice, the manager evolves
selection criteria such as maximum profit, least
cost, minimum wastage, least time taken and
highest utility. The criterion is applied to the various
decision alternatives and the one which satisfies
the most is selected.
 An example of the Simon model would
illustrate further its use in the MIS. For example, a
manager finds on collection and through the
analysis of the data that the manufacturing plant is
underutilized and the products which are being sold
are not contributing to the profits as desired.
 The problem identified, therefore, is to find a
product mix for the plant, whereby the plant is fully
utilized within the raw material and the market
constraints, and the profit is maximized.
 The manager having identified this as the
problem of optimization, now examines the use of
linear programming (LP) model. The model is used
to evolve various decision alternatives. However,
selection is made first on the basis of feasibility and
then on the basis of maximum profit
 Factors Influencing Decision-Making
 Time Pressures
 Manager's Value
 Organization policy
 Managers propensity to take risk
