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Chapter 1 - Information System in Organization

Chatper 1 of the class, mainly introduce the concept of Information Systems and elaborate how the IS supports the organizations.


on 3 July 2014

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Transcript of Chapter 1 - Information System in Organization

What is Information System?
Business Perspective on Information Systems
- streams of
raw facts
representing events occurring in organizations or the physical environment before they have been organized and arranged into a form that people can understand and use
- it means that the data has been shaped into a form that is
to human beings in processes such as making decisions
To fully understand information systems, a manager must understand the broader
, and
information technology
dimensions of systems and their power to provide solutions to challenges and problems in the business environment
Thursday, 3 July, 2014
Vol XCIII, No. 311
Learning Objectives
Chapter 1 - Information System in Organization
Components of Information Systems
Overview of Management Information System

Different between "Data" and "Information"

Concept of "Organization", "Management" and "Technology"

Modules of Information System

Roles of Information System
An information system contains information about an organization and its surrounding environment.
ISM0430 - Management Information System
Information system can be defined as a set of interrelated components that
collect (or retrieve)
information to support decision making, coordination and control in an organization.
It may also help managers and workers to analyze problems, visualize complex subjects and create new products.

Characteristics of valuable information

- should be
error free

contains all
the important facts

to the decision makers

- be relatively
economical to produce

- can be used for a
variety of purpose

- can be
depended on

- can be checked to
ensure it is correct

delivered when it is needed

not overly complex

- easily accessible by
authorized users

- secure from access by
unauthorized users

- The
of raw data within the organization or from its external environment.

- The
, and
of raw input into a form that is more meaningful to humans.

- The
of processed information to the people who will use it or to the activities for which it will be used.

- Output that is returned to
or correct input.
1. Organization
Information systems are an integral part of organizations.

The key elements of an organization are its people, structure, operating procedures, politics, and culture.

Standard Operating Procedures (SOPs) are formal rules that have been developed to cope with expected situations.

Organizations require many different kinds of skills and people:

Knowledge Worker
- People such as engineers or architects, who design products or services and create knowledge for the organization.

Data Worker
- People such as secretaries or bookkeepers, who process the organization’s paperwork.

Production or Service Worker
- People who actually produce the products or services of the organization
2. Management
Managers set the organizational strategies for allocating the human and financial resources to achieve the strategies and coordinate the works.

Operational Managers
– monitor the day-to-day activities of the organization and responsible for monitoring the firm’s daily activities.

Middle Managers
–middle of the organizational hierarchy who are responsible for carrying out the plans and goals from senior management.

Senior managers
– occupying the topmost hierarchy in an organization who are responsible for making long-range decisions about products and services to produce

3. Technology
Computer Hardware
– Physical equipment used for input, processing, output activities in an information system.

Computer Software
– Detailed, pre-programmed instructions that control and coordinate the work of computer hardware components in an information system.

Storage technology
– Physical media and software governing the storage and organization of data use in an information system.

Communications technology
– Physical devices and software that link various computer hardware components and transfer data from one physical location to another.

Information Technology (IT) Infrastructure
– It provides the foundation, or platform, on which the firm can build its specific information systems.

Each organization must carefully design and manage its IT infrastructure so that it has the set of technology services it needs, for the work it wants to accomplish which information systems

Modules of Information Systems
Transaction Processing Systems (TPS)
It is the basic business system that serves the
operational level
of the organization.

It performs and records the
daily routine transactions
necessary to
conduct the business

Example: Point of Sales (POS), Auto Teller Machine (ATM)
Knowledge Work System (KMS)
It aids knowledge workers in the
creation and integration of new knowledge
in the organization.

Example: Computer-Aided Design (AutoCAD)

Office Automatic System (OA)
Such as word processing, electronic mail and scheduling systems that is designed to
increase the productivity of data workers
in the office.

Example: Microsoft Office

Management Information System (MIS)
It serves the management level of the organization, providing managers with reports or with on-line access to the organization’s
current performance
historical records

It primarily serves the functions of planning, controlling, and decision making by providing routine summary and exception reports
Most of the reports are generated by MIS

Decision Support System (DSS)
It serves the management level of the organization make decisions by
modeling various scenarios

It combines data and sophisticated analytical models or data analysis tools to helps managers
make decisions that are unique, rapidly changing, non-routine and not easily specified in advise

Example: Oracle Crystal Ball (

Executive Support System (ESS)
Sometimes so called
Executive Information System (EIS)

It serves the strategic level of the organization.

It address
non-routine decisions
requiring judgment, evaluation, and insight because there is no agree-on procedure for arriving at a solution.

It is
not designed primarily to solve specific problems
. It provides a generalized computing and communications capacity that can be applied to a changing array of problems. Whereas many DSS are designed to be highly analytics, ESS trend to
make less use of analytical models
Expert System (ES)
It solves problems by
capturing knowledge
for a very specific and limited domain of human expertise.
The Protection Calculator provides by AIA (http://www.aia.com.sg/protection) applies the ES to analysis the customer’s insurance and financial needs
Roles of Information System
The fundamental roles of Information System in business:

- Support of its business processes and operations;

- Support of decision making by its employee and managers; and

- Support to its strategic competitive advantages

Data Vs. Information
Name: Jimmy

Age: 36

Highest Education: Higher Diploma in HR.

Working Experience: 12 Years, Sr. HR Officer

Existing Salary: $32,000/mth

1. Working in your company for 6 years.
2. Awarded the Best Staff in Year 2013.

Name: George

Age: 53

Highest Education: Master Degree in HR

Working Experience: 35 Years, Sr. HR Manager

Existing Salary: $45,000/mth

Expected Salary: $53,000/mth



Who will be your HR Manager?

Name: Annie

Age: 33

Highest Education: Bachelor Degree in Business Admin.

Working Experience: 7 Years, Sr. HR Officer

Existing Salary: $30,000/mth

1. Working in your company for 4 years.
2. Awarded as Best Staff in Year 2012.

Name: Grace

Age: 32

Highest Education: Bachelor Degree in HR

Working Experience: 8 Years, Sr. HR Officer

Existing Salary: $32,000/mth

Expected Salary: $40,000/mth

You are the HR Director of a Trading Company. Your HR Manager of Recruitment Team has resigned and you are looking for her successor. Your recruitment agents has just sent you 3 candidates for selection while you are also considering if you the existing two Senior HR Officers can be promoted. You will have an interview with each of them this evening attached with their C.V. / Personal Record for your reference.

Name: Peter

Age: 29

Highest Education: Bachelor Degree in HR

Working Experience: 4 Years, HR Clerk

Existing Salary: $20,000/mth

Expected Salary: $28,000/mth

** END **
Interrelationships among systems.

The various types of systems in the organization have inter-dependencies. TPS are a major producer of information that is required by the other systems which, in turn, produce information for other systems. These different types of systems are only loosely coupled in most organization
Note: http://1drv.ms/THR9UJ

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