FOUNDATIONS OF INFORMATION SYSTEMS

- Lesson 1 -
Angelina Njegu, PhD
Associate Professor at Singidunum University
Belgrade - Serbia, 2013
Prof. dr Angelina Njegu
System Concept
Entity 1 Entity 2
Entity N Entity 3
System boundary
Environment
Input Output
Feedback
Prof. dr Angelina Njegu
Data, Information, Knowledge, Wisdom
Source: Swindoll, 2011
(Available at: http://www.pursuant.com/blog/tag/dikw-model/)
Prof. dr Angelina Njegu
Information Systems (IS)
Organised and integrated set of:
Data
Processes
Interfaces
Networks
Technologies
People
that are correlated in order to support
and improve everyday business
operations and decision making
Prof. dr Angelina Njegu
Information Systems
Real life system
Information System
Prof. dr Angelina Njegu
Basic IS Activities
Output
Input
Processing
Storage
Control
Source: O-Brien et al., 2010
Prof. dr Angelina Njegu
Information Processing Cycle
Source: Morley et al., 2013
Prof. dr Angelina Njegu
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(OLAP cubes,
Operational BI)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI )
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards )
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps
Prof. dr Angelina Njegu
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(OLAP cubes,
Operational BI)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI )
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards )
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps
Prof. dr Angelina Njegu
Operations Information Systems (OIS)
Organised set of:
hardware
software
databases
telecommunications
people
procedures
that are configured to:
collect
manipulate
store
process
data into information, and support an
organisations day-to-day business activities
Any organised
combination of
Data
Processes
Policies and
procedures
Interfaces
Communi-
cation
networks
Technologi-
es
People
Prof. dr Angelina Njegu
Operations Information Systems (OIS)
Support operational
processes that
constitute the core
business and create the
primary value stream

Typical operational
processes are:
Finance
Manufacturing
Marketing
Human Resources ...
Source: Rosen, 2006
Prof. dr Angelina Njegu
Transaction Processing Systems (TPS)
TPS collects, store, modify, and retrieve business trasactions
A transaction is an event that generates or modifies data that are
stored in an information system
Any business-related exchange, such as payments to employees, sales
to customers, payments to suppliers ...
Prof. dr Angelina Njegu
Ways to Process Transactions
Batch processing
Accumulate transactions
over time and then process
periodically

Example: During the night, all
daily OLTP database changes
are all at one time extracted,
transformed, and loaded into
the data warehouse
Online processing
Process all transactions
immediately


Example: A bank system
processes ATM withdrawals
immediately
Prof. dr Angelina Njegu
Some TPS features
The main purpose of the TPS is to ensure the consistency and integrity of
data
For example: In case of e-payment amount must be withdrawn from one
account and added to another. If transaction fails, than rolleback function
deletes all data changes that have occurred since the beginning of the
transaction.
Source: IBM, 2012
Prof. dr Angelina Njegu
Some TPS features (cont.)
Transaction systems must be able to support a large number
of concurrent users and transaction types
For example: Multiple operators simultaneously access airline reservation
system. When one operator access, booking is locked until it is completed.
Otherwise, another operator could access the same data and make double
booking.
Prof. dr Angelina Njegu
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(OLAP cubes,
Operational BI)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI )
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards )
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps
Prof. dr Angelina Njegu
Business Process Management Systems
Business process is a collection of related, structured, and coordinated
value-added activities that combine available resources (input) to produce
a specific output (product or service)
For instance, the process of filling a customer order involves several related
tasks.

Source: Interfacing, 2011
Prof. dr Angelina Njegu
Business Process
A business process transforms inputs into outputs, according
to guidance (business policies, standards, procedures,
business rules, etc.) employing resources of all types
Input
Output
Guidance
Resources
Prof. dr Angelina Njegu
Examples of Business Processes
Accounting Business Processes:
Accounts payable
Accounts receivable
Cash receipts
Invoice billings ...
Finance Business Processes:
Account collection
Bank loan applications
Business forecasts
Customer credit approval and
credit terms ...
Marketing Business Processes:
Customer satisfaction surveys
Customer service contracts
Customer compliant handling
Sales order entry ...
Production/Operations Business
Processes:
Bill of materials
Quality control for finished goods
Packing, storage, and distribution
Shipping and freight claims ...
Human Resources Business
Processes:
Disabilities employment policies
Employee hiring policies
Files and records management
Health care benefits
Pay and payroll
Training/tuition reimbursement
Workplase rules and guidelines ...





Source: Rainer et al., 2011
Prof. dr Angelina Njegu
Why are BPM systems important?
Business processes are strategic assets of an organization that must be
understood, managed, and improved to deliver value-added products and
services to clients the goal of BPM systems
Economics: globalization demands flexibility
Business processes: changing quickly, shrinking cycle times
Revenue growth: at the top of CEO agenda
Reusable assets: can cut costs
Business Process Reengineering (BPR) continuous process improvement
Business process management (BPM) systems give organisations the
flexibility to quickly respond to changes in the competitive environment
Prof. dr Angelina Njegu
Business Process Management
Discover, document, automate, and continuously improve business processes to
increase efficiency and effectiveness while striving for innovation, flexibility, and
integration with technology

Prof. dr Angelina Njegu
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI )
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards )
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps
Prof. dr Angelina Njegu
Office and Collaboration Systems
A suite of applications (Software packages) for creating, editing, and
sharing text, spreadsheet, presentations and other documents in order to
facilitate and speed up the daily office tasks, as well as mutual business
communication

Prof. dr Angelina Njegu
Collaboration Systems
Support communication, and coordination among teams and work groups
over geographic distances
Depending on the level of collaboration, can be divided into three
categories:
Communication tools - interchange of messages, files, data, or documents in
order to facilitate the sharing of information
Examples: e-mail, voice mail, chat, Wikis, Web publishing ...
Conferencing tools - refers to interactive work toward a shared goal
Examples: Internet forums, online chat, Internet telephony, video conferencing,
electronic meeting systems, Webcast ...
Collaborative management tools facilitate and manage group activities
Examples: Time management software, Document Management Systems, Project
management systems, Social software systems ...

Prof. dr Angelina Njegu
Collaboration Systems
Prof. dr Angelina Njegu
Collaboration Systems
Prof. dr Angelina Njegu
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI )
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards )
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps
Prof. dr Angelina Njegu
Operational data
Information
Business Intelligence Systems
Set of tools and systems for gathering, extracting, storing, analyzing and
translating business information into knowledge to support decision-
making and improve overall business effectiveness

Knowledge
workers
Prof. dr Angelina Njegu
Operations vs BI systems
Prof. dr Angelina Njegu
Decisions
Prof. dr Angelina Njegu
Business Intelligence System
Prof. dr Angelina Njegu
Decisions are based on
Prof. dr Angelina Njegu
Why Business Intelligence?
What happened?
What is happening?
Why did it happen?
What will happen?
What do I want to happen?
ERP CRM 3Pty SCM
Past
Present
Future
Data
Prof. dr Angelina Njegu
Frontend tools
34
Prof. dr Angelina Njegu
Decision structure
Prof. dr Angelina Njegu
BI Pyramid
KPIs, Scorecards, Dashboards
OLAP, Mining, Forecasting
Management Reports
Detailed Operational
Reports
INVOICES, SHIPPING DOCUMENTS, PICK LIST
SALES TOTALS, LEADS ANALYSIS, CLICK THROUGH
RATIOS, BUDGETS
PERFORMANCE, PRODUCTION
TIMES, CUSTOMER CHURN
METRICS
Complexity
Quantity
Executives,
Top Managers
Professionals, Problem
solvers, Middle manager
Front-line manager
Transactors
OPERATIONAL
TACTICAL
STRATEGIC
REAL TIME
Prof. dr Angelina Njegu
Types of Business Intelligence
Systems
Operational BI: Management Information Systems (MIS)
Provides routine information to managers and decision makers
Primary focus is operational efficiency
Reports and displays
Example: daily sales analysis reports

Tactical BI: Decision Support Systems (DSS)
Used to support problem-specific decision making
Focus is on decision-making effectiveness
Interactive OLAP and ad hoc decision support, data mining method
analysis, predictive analytics
Example: where to spend advertising dollars

Strategic BI: Executive Information Systems (EIS)
Critical information for executives and senior managers
Example: easy access to actions of competitors, BSC, KPI ...
Prof. dr Angelina Njegu
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI )
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards )
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps
Prof. dr Angelina Njegu
Expert Systems (ES)
Field of Artifical Intelligence (AI)
AI focuses on the development and study of systems that support human
behavior and intelligence (learning, understanding, problem solving,
reasoning, knowledge, etc.)
The most important subdomains of AI are:
Natural Language Processing
Interpretation and processing of visual information and signals (Biometrics ...)
Robotics
Knowledge based systems or Knowledge Engineeering (Expert Systems ...)
Software Agents or Intelligent Agents
Machine Learning (Data Mining, Speech recognition, Text analysis ...)
Prof. dr Angelina Njegu
Expert Systems
Simulate the knowledge, and reasoning process in solving complex
problems and emulates the decision-making ability of an expert in order
to arrive at the same conclusions as a human expert would
Expert in a specific field:
has a high-degree of knowledge, skill, and experience
Understands the problem and recognizes structured and typical problem-
solving process
Has heuristic knowledge (resillience, good judgment ...)
Recognizes the fastest way to come up with the soultion ...
Some knowledge representation techniques are:
Rules: IF you are hungry THEN eat
Semantic nets: graph with logically connected nodes ...
Prof. dr Angelina Njegu
ES Architecture
Source: Abacus, 2009
Prof. dr Angelina Njegu
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI )
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards )
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps
Prof. dr Angelina Njegu
Geographic Information Systems
Source: Bisag, 2009.
Prof. dr Angelina Njegu
Storing GIS Data for the Web
The steps of serving a map are:
Data are aggregated in a database
Data are transformed into an image using
a rendering engine
The image is served through a map server
The main types of GIS data:
Vector data (points, lines, and polygons)
are stored in tables as sets of geographic
coordinates and attributes .
Raster data - collections of pixels that
make up images
XML has become an important language
for transferring geographic data over the
internet
Open Geospatial Consortium (OGC)
defined a Geography Markup Language
(GML) standard
Source: Bisag, 2009.
Prof. dr Angelina Njegu
GIS Applications
Source: Abukhater, 2011.
Prof. dr Angelina Njegu
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI )
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards )
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps
Prof. dr Angelina Njegu
Knowledge Management
Systems
IT-based systems developed to support, manage and
enhance the organisational processes of knowledge
creation, storage/retrieval, transfer, and application

Source: ITSM, 2008
Prof. dr Angelina Njegu
Information Technology
Infrastructure Library - ITIL
Documented set of best practices for IT service management
(ITSM) that focuses on aligning IT services with the needs of
business
ITSM is a discipline for managing IT systems
ISO/IEC 20000 standard - the first international standard for IT service
management
ISO/IEC 20000 certification is an assessment of IT department as a
means of showing that organization reached a level of maturity for
services delivery
Prof. dr Angelina Njegu
Best practises
Prof. dr Angelina Njegu
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI )
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards )
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps
Prof. dr Angelina Njegu
Virtual Reality
3D simulation of a real or imaginary environment
Tool for communication, entertainment, and learning
Virtual Reality in Tourism can be used:
to recreate historic sites and events
to provide a means of protecting the fragile state of some heritage
to create virtual experiences (virtual tours) for tourists
to create virtual guides
for marketing, planning and management, entertainment, education,
accessibility ...

Prof. dr Angelina Njegu
Second Life I-Room
Virtual Space for Intelligent Interaction

Prof. dr Angelina Njegu
Trends in Information Systems
Source: OBrien, 2010
Prof. dr Angelina Njegu
References
1. Swindoll, C. (2011) Redefining Fundraising Data, Pursuant [Online]. Available at: http://www.pursuant.com/blog/tag/dikw-model/
(accessed: 1.11.2012)
2. OBrien, J.A., Marakas, G.M. (2010) Introduction to Information Systems, McGraw-Hill Companies, Inc.
3. Rosen, S. (2006) Information Systems in the Enterprise, Santa Rosa Junior College [Online]. Available
at:http://www.santarosa.edu/~srosen/CIS66/ch2notes.htm (accessed 2.11.2012)
4. IBM (2012) Rolling back work, IBM [Online]. Available at:
http://publib.boulder.ibm.com/infocenter/dzichelp/v2r2/index.jsp?topic=%2Fcom.ibm.db2z10.doc.intro%2Fsrc%2Ftpc%2Fdb2z_rollbackwork.
htm (Accessed, 2.11.2012)
5. Interfacing Technologies Corporation (2011) What is Business Process Management (BPM)?, ODESIA Co. [Online]. Available at:
http://www.interfacing.com/Literature/what-is-bpm (accessed: 2.11.2012)
6. Rainer, R. K., Cegielski, C.G. (2011) Introducing to Information Systems: Enabling and Transforming Business, 3rd edition, Wiley & Sons, Inc.
7. Kaur, E.B, Kaur, E.S. (2012) Overview of Intelligent Systems, International Journal of Computing & Business Research.
8. Abacus (2009) Artificial Intelligence Systems, Abacus Programming Corporation. Available at:
http://www.abacuscorp.com/artificial_intelligence_systems.htm (accessed: 7.11.2012)
9. IT Service Management (2008) ITIL Service Management. Available at: http://itservicemngmt.blogspot.com/2008/03/iso-20000-
rediscovered.html (accessed 7.11.2012)
10. Morley, D., Parker, C. (2013) Understanding Computers: Today and Tomorrow, 14th Edition, Course Technology Cengage Learning, Boston, MA,
USA.
11. Bisag (2009). Thrust Areas for Geo-informatics Applications. Bhaskaracharya Institute For Space Applications and Geo-Informatics. Available at:
http://www.bisag.gujarat.gov.in/research.htm (accessed 16.07.2013)
12. Abukhater, A. (2011). GIS for Planning and Community Development: Solving Global Challenges. Directions Magazine. Available at:
http://www.directionsmag.com/articles/gis-for-planning-and-community-development-solving-global-challenges/149245 (accessed
16.07.2013)
13. GISC (2013). Storing GIS Data for the Web. Available at: http://giscollective.org/tutorials/web-mapping/wmsfive/ (accessed 16.07.2013)