Introduction to information system

• Information systems are used in almost every imaginable profession
• Entrepreneurs and small business owners use information systems for

  • Marketing
  • Decision making on business
  • Financial planning, accounting etc
• Data

  Raw facts, such as an employee number, total hours worked in a week, inventory part numbers, or sales orders
• Data represents

  Real-world things. Hospitals and healthcare organizations, for example, maintain patient medical data, which represents actual patients with specific health situations
• Data is normally collected through

  Data collection methods, for example a survey
• Information

  A collection of facts organized so that they have additional value beyond the value of the individual facts
• Providing information to customers can help companies increase revenues and profits
• Turning data into information

  A process, or a set of logically related tasks performed to achieve a defined outcome
• Knowledge

  The awareness and understanding of a set of information and the ways that information can be made useful to support a specific task or reach a decision
• Selecting or rejecting facts according to their relevance to particular tasks is based on the knowledge used in the process of converting data into information
• Information can also be thought of as data made more useful through the application of knowledge
• If an organization's information is not accurate or complete, people can make poor decisions, costing thousands, or even millions, of dollars
• Characteristics of valuable information

  • Accessible
  • Accurate
  • Complete
  • Economical
  • Flexible
  • Relevant
  • Reliable
  • Secure
  • Simple
  • Timely
  • Verifiable
• Depending on the type of data you need, some characteristics become more important than others
• The value of information is directly linked to how it helps decision makers achieve their organization's goals
• Valuable information can help people and their organizations perform tasks more efficiently and effectively
• Valuable information can also help managers decide whether to invest in additional information systems and technology
• Most corporations have cost reduction as a primary goal. Using information systems, some manufacturing companies have slashed inventory costs by millions of dollars
• Information system (IS)

  A set of interrelated elements or components that collect (input), manipulate (process), store, and disseminate (output) data and information, and provide a corrective reaction (feedback mechanism) to meet an objective
• Input

  The activity of gathering and capturing raw data
• Processing

  Converting or transforming data into useful outputs. It can involve making calculations, comparing data and taking alternative actions, and storing data for future use
• Output

  Producing useful information, usually in the form of documents and reports
• Feedback

  Information from the system that is used to make changes to input or processing activities
• Feedback is also important for managers and decision makers
• A computer system can also be proactive—predicting future events to avoid problems
• Manual information system

  An information system that does not use computers
• Computerized information system

  A single set of hardware, software, databases, telecommunications, people, and procedures that are configured to collect, manipulate, store, and process data into information
• Computer-based information systems (CBISs) can also be embedded into products like cars and home appliances
• CBIS

  Computer-based information system - the components of hardware, software, databases, telecommunications, people, and procedures that are configured to collect, manipulate, store, and process data into information
• CBIS


  • A company's payroll, order entry, or inventory-control system
• CBIS embedded into products

  • Computer hardware, software, databases, and telecommunications to control operations and make them more useful
  • Often called embedded, pervasive, or ubiquitous computing
• Industries that use information systems

  • Airline industry
  • Investment firms
  • Banks
  • Transportation industry
  • Publishing companies
  • Healthcare organizations
  • Retail companies
  • Professional services firms
• Transactional Processing System (TPS)


  An organized collection of people, procedures, software, databases, and devices used to record completed business transactions
• Management Information System (MIS)

  An organized collection of people, procedures, software, databases, and devices that provides routine information to managers and decision makers
• Decision Support System (DSS)

  An organized collection of people, procedures, software, databases, and devices that support problem-specific decision making
• Specialized Business Information System

  Systems beyond TPSs, MISs, and DSSs, such as knowledge management systems, expert systems, and systems using artificial intelligence
• Benefits of IT

  • Faster processing
  • Storage facility
  • Multiple access
  • Improved performance of knowledge workers
  • Customized outputs
  • Integrated applications
  • 24/7 global business
  • Improved communication
• Drawbacks of IT

  • Loss of jobs
  • Security issues
  • Health problems
  • Ethical issues
  • Privacy concerns
  • Software reliability