Introduction to Computer

Systems
Information Systems in Business

By: Lempogo Forgor

Information Systems in Business

3 Hours

Objectives
By the end of this unit, students should be able to:
y Identify the types of information systems used in business
y Discuss how computer technology and information systems has

transformed the business society

y Explain the processes of developing business software.

Overview
y Information
y System
y Information system
y Types of information systems in business
y Role of information systems in business
y Systems development life-cycle

What is Information?
1.

Information is the results of the capture and organization of

data.

2.

Information is raw data processed so as to convey a new meaning.

What is Data?
Data are raw facts about organization and its business
transaction.
Most data items have little meaning and use by themselves.

What is a System?
A system is a collection of interrelated components
that function together to achieve some outcome.
y Examples?

System
Environment

Input

Processing

Output

Information systems
Information system is a collection of interrelated

components that collect, process, store and provide

as output the information needed to complete a
business task.
The transformation of data into information is the

primary function of an information system.

Information System
Environment

Data

Processing

Information

Types of information systems

y Management information system
y Decision Support System
y Transaction processing systems
y Expert systems

Management Information System

Information systems that provides for management
oriented
reporting.
Examples?
y Budget forecasting and analysis
y sales forecasting
y inventory reporting
y etc.

Decision Support System

An information system that provides it users with
decision-oriented information whenever a decision
situation arises.
When applied to executive managers, these systems are
sometimes called Executive Information Systems.

Transaction Processing Systems

Information systems that capture and process
data about business transactions.
Examples ?
online order processing systems
airline reservations
course registration
Hotel check-in/check-out
etc.

Expert Systems
A decision making information system that captures
and produce the knowledge and expertise of an
expert problem solver or decision maker and then
simulates the thinking and actions of an expert.

Components of Information System

y People (End Users and IS Specialists)
y Hardware (Computer Systems and Peripherals)
y Software (System Software, Application software and

Procedures)
y Data
y Network (Communication media and Network Support)

What are the Roles of IS in Business?

y Support business processes and operations
y Support decision making
y Support strategies for competitive advantage

Support Business Processes and Operations

Information systems usually are integrated combinations of crossfunctional business systems.
Some cross-functional systems concepts which support business
processes include:
y Enterprise Resource Planning
y Customer Relationship Management
y Enterprise Application Integration
y Online Transaction Processing
y Enterprise Collaboration

Support Decision Making

Using information systems to support business decision making has
been one of the primary thrusts of the business use of information
technology.
Some cross-functional systems concepts which support business
decision making processes include:
y Decision support systems
y Management information systems
y Executive Information Systems
y OnLine Analytical Processing
y Geographic Information Systems

Support strategies for competitive advantage

The strategic role of information systems involves using
information technology to develop products, services,
and capabilities that give a company major advantages
over the competitive forces it faces in the global
marketplace.

What are Strategic Information Systems?

Strategic Information Systems - information systems that support
or shape the competitive position and strategies of an e-business
enterprise.
So a strategic information system can be any kind of information system
(TPS, MIS, DSS, etc.) that helps an organization gain a competitive
advantage, reduce a competitive disadvantage, or meet other strategic
enterprise objectives .

Information Systems Development

The Processes involved in developing an information systems is called
the System Development Life-Cycle (SDLC)
The Traditional system development life-Cycle has five main phases:
y Systems Investigation
y Systems Analysis
y Systems Design
y Systems Implementation
y Systems Maintenance and Review

The Systems Investigation Phase

In the systems investigation phase, potential problems and opportunities
are identified and considered in light of the goals of the business.
Systems investigation attempts to answer the question:
"What is the problem?
Is it worth solving?"
The primary result of this phase is a defined development project for
which:
business problems or opportunity statements have been created,
some organizational resources have been committed,
systems analysis is recommended

The Systems Analysis Phase

Systems analysis attempts to answer the question "What must the
information system do to solve the problem?"
This phase involves the study of existing systems and work processes to
identify:
strengths,
weaknesses,
opportunities for improvement
The major outcome of systems analysis is a list of requirements and
priorities.

The Systems Design Phase

y Systems design seeks to answer the question:

"How will the information system do what it must do to obtain the problem
solution?"
y The primary result of this phase is a technical design that either describes

the new system or describes how existing systems will be modified.

y The system design details:
System outputs, inputs, and user interfaces;
Specifies hardware, software, database, telecommunications, personnel,

procedure components;
How these components are related.

The Systems Implementation Phase

y Systems implementation involves:
Creating or acquiring the various system components detailed in the

systems design phase

Assembling them,
Placing the new or modified system into operation.
y An important task during this phase is to train the users.
y Systems implementation results in an installed, operational

information system that meets the business needs for which it was
developed.

The Systems maintenance and review Phase

y The purpose of systems maintenance and review is to

ensure that the system operates and to modify the

system so that it continues to meet changing business
needs.

The Systems Development Life-Cycle

y A system under development moves from one phase of

the traditional SDLC to the next.

SYSTEM
INVESTIGATION
Understand
Problem

SYSTEM
ANALYSIS
Understand
Solution

SYSTEM
DESIGN
Select and plan
Best Solution

SYSTEM
IMPLIMENTATION
Place Solution into
Effect

SYSTEM
MAINTENANC
E AND REVIEW
Evaluate Results
and Solution

Failure of information systems

Some of the factors that can lead to the failure of information
systems include:
y Mismanagement
y Misapplication
y Poor Participation
y Lack of proper staff training
y Lack of Commitment

Any Questions?

y Email: forlempo@yahoo.co.nz