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Types of Information Systems

Based on material from Information Systems Today: Managing in the Digital World, Leonard Jessup and Joseph Valacich, Pearson Prentice Hall, 2007 Also includes material by David Schuff, Paul Weinberg, and Cindy Joy Marselis.

Learning Objectives

Learning Objectives

Decision-Making Levels of an Organization

Operational Level

Day-to-day business processes Interactions with customers Information systems used to:

Automate repetitive tasks Improve efficiency Structured Recurring Can often be automated using IS

Decisions:

Examples?

Managerial Level

Functional managers

Monitoring and controlling operational-level activities Providing information to executive level Midlevel managers
Focus on effectively utilizing and deploying resources Goal of achieving strategic objectives

Managers decisions

Semi-structured Contained within business function Moderately complex Time horizon of few days to few months

Examples?
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Executive Level
The president, CEO, vice presidents, board of directors Decisions

Long-term strategic issues Complex and nonroutine problems Unstructured decisions Long-term ramifications

Examples?
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Comparison of Decision-Making Levels


Operational Level
Who What
Foreman or supervisor

Managerial Level
Midlevel managers and functional managers Automate the monitoring and controlling of operational activities Improve organizational effectiveness Management Information Systems (MIS)

Executive Level
Executive-level managers Aggregate summaries of past organizational data and projections of the future Improve organizational strategy and planning Executive Information Systems (EIS)

Automate routine and repetitive activities

Why IS

Improve organizational efficiency Transaction Processing Systems (TPS)


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Learning Objectives

General Types of Information Systems

Input-process-output model
Basic systems model Payroll system example

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Transaction Processing System


Operational level Purpose:


Processing of business events and transactions Increase efficiency


Automation Lower costs Increased speed and accuracy

Examples

Payroll processing Sales and order processing Inventory management Etc.


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Architecture of a TPS

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Architecture of a TPS: Inputs

Source Documents

Different data entry methods

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Architecture of a TPS: Processing

Online processing

Immediate results Transactions collected and later processed together Used when immediate notification not necessary

Batch processing

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Architecture of a TPS: Outputs


Counts, summary reports Inputs to other systems Feedback to systems operator

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Summary of TPS Characteristics

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Management Information Systems


Managerial level Purpose:


Produce reports Support of midlevel managers decisions Sales forecasting Financial management and forecasting Manufacturing, planning and scheduling Inventory management and planning Etc.
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Examples

Architecture of an MIS

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Architecture of an MIS: Processing


Aggregation Summary

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Architecture of an MIS: Outputs

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Summary of MIS Characteristics

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Executive Information Systems


A.k.a. Executive support system Executive level Purpose

Aid in executive decision-making Provide information in highly aggregated form Monitoring of internal and external events and resources Crisis management Etc.

Examples

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Architecture of an EIS

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Architecture of an EIS: Inputs

Hard data
Facts and numbers Generated by TPS & MIS Purchased data

Soft data
Nonanalytical information Web-based news portals

Customizable Delivery to different media


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Architecture of an EIS: Processing


Summarizing Graphical interpreting

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Architecture of an EIS: Outputs


Summary reports Trends Simulations

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EIS Output: Digital Dashboards

Digital dashboard Presentation of summary information Information from multiple sources Ability to drill down if necessary

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Summary of EIS Characteristics

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Summary
So whats the trend as you go down the list/up the pyramid?

Executive Information Systems Highest level summary of information Management Information Systems Aggregate and collect data Transaction Processing Systems Collect data
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Summary: Types of Information Systems


Weaker

EIS
Controls and Security

MIS

TPS
Stronger

Operations Staff

Transaction Processing

Source: Business Driven Technology, by Haag, Baltzan, Phillips, McGraw Hill, 2006 (with modifications) 30

Summary: Decision Levels

Decision Level

Description Competitive advantage Market leader Long term Improve operations without restructuring

Example New products that change the industry

Type of Information External events, rivals, sales, costs quality, trends.

Executive

Management

New tools to Expenses, cut costs or impschedules, sales rove efficiency models, forecast Scheduling employees, placing orders. Transactions, accounting, HRM, inventory

Operations

Day-to-day actions keep company running

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Learning Objectives

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Information Systems Today: Managing in the Digital World

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Seven Information Systems that Span Organizational Boundaries

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1. Decision Support Systems


Decision making support for recurring problems Used mostly by managerial level employees (can be used at any level) Interactive decision aid What-if analyses

Analyze results for hypothetical changes

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Architecture of a DSS

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Common DSS Models

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Information Systems Today: Managing in the Digital World

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Using DSS to Buy a Car


Selling price $22,500 Down payment $2,500 Monthly payment about $400 Interest rate information from the bank

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2. Intelligent Systems

Artificial intelligence
Simulation of human intelligence Reasoning, learning, sensing, hearing, walking, talking, etc.

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Intelligent Systems

Three types
Expert systems Neural networks Intelligent agents

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Expert Systems

Use reasoning methods Manipulate knowledge rather than information System asks series of questions Inferencing/pattern matching

Matching user responses with predefined rules If-then format

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Neural Network System


Approximation of human brain functioning Training to establish common patterns

Past information

New data compared to patterns E.g., loan processing

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Example: Neural Network System

Loan processing system relying on a neural network

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Intelligent Agent Systems

Program working in the background Bot (software robot) Provides service when a specific event occurs

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Intelligent Agent Types


1. Buyer agents (shopping bots) search for best price 2. User agents perform a task for the user 3. Monitoring and sensing agents keep track of key
information

4. Data-mining agents analyze large amounts of data 5. Web crawlers (web spiders) browse the Web for
specific information

6. Destructive agents malicious agents designed by


spammers

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3. Data Mining and Visualization Systems

Application of sophisticated statistical techniques

What-if analyses to support decision making

Capabilities can be embedded into a large range of systems

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Visualization

Display of complex data relationships using graphical methods

Visualization of a weather system

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Text Mining

Extraction of information from textual documents Web crawlers used to extract information from Internet

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4. Office Automation Systems


Developing documents, scheduling resources, communicating Examples

Word processing Desktop publishing Electronic calendars E-mail

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5. Collaboration Technologies
Increased need for flexible teams Virtual teams dynamic task forces

Forming and disbanding as needed Fluctuating team size Easy, flexible access to other team members

Need for new collaboration technologies

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Video Conferencing

Costs few thousand dollars to $500,000

Dedicated videoconferencing systems Located within organizational conference rooms Highly realistic

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Groupware

Enables more effective team work

Distinguished along two dimensions

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Benefits of Groupware

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6. Knowledge Management Systems


Generating value from knowledge assets Collection of technology-based systems Knowledge assets

Skills, routines, practices, principles, formulas, methods, heuristics and intuition Used to improve efficiency, effectiveness and profitability Documents storing both facts and procedures Examples
Databases, manuals, diagrams, books, etc.

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Benefits and Challenges of Knowledge Based Systems

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7. Functional Area Information Systems


Cross-organizational-level IS Support specific functional area Focus on specific set of activities

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Business Processes Supported by Functional Area Information Systems

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Cases

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Amazon.com

35 million customers worldwide Innovations leading to satisfaction


Personalized greeting Memory for recent purchases Targeted gold box offers and bargains Shipping vs. billing address comparison Method of shipment checks Credit card sources checks
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Fraud protection

One-click shopping

The Growing Blogosphere

One of the fastest growing phenomena in the digital world

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Too Much Technology? RFID and Privacy

RFID tags

Latest in technological tracking devices Information imprinted on a tag Tag generates signature signal Special RFID reader interprets signal

Use of RFID tags


Pharmaceutical industry
Tracking of medication from factory to pharmacy

Retail businesses
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