10
Chapter
Information
Systems
Chapter 10
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Learning Outcomes
1. Explain the functional view of an organization and describe each function.
2. Describe the management levels and the informational needs for each
level in an organization.
3. Describe how information flows within an organization.
4. Describe computer-based information systems.
5. Distinguish among a transaction processing system, a management
information system, a decision support system, and an executive support
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system.
6. Distinguish between office automation systems and knowledge work
systems.
7. Explain the difference between data workers and knowledge workers.
8. Define expert systems and knowledge bases.
© 2017 by McGraw-Hill Education. This proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or
posted on a website, in whole or part.
Introduction
An information system is a
collection of people, procedures,
software, hardware, data, and
connectivity
They all work together to provide
information essential to running
an organization
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Computers are used in organizations
to keep records of events
Competent end users need to
understand how the information
flows as it moves through an
organization
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posted on a website, in whole or part.
Organizational Information Flow
Information flows vertically and
horizontally throughout an organization
Information systems support the natural
flow of information within an organization’s
structure
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Information systems can be broken down
into one of five different functional areas, a
management level and / or information
flow.
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posted on a website, in whole or part.
Five Functions of an Organization
Accounting
Records all financial activity
Marketing
Plans, prices, promotes, sells and
distributes the goods
Human Resources
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Human-centered activities
Production
Creates finished goods and services
Research
New product development
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posted on a website, in whole or part.
Management Levels
Management is usually
divided into three levels:
Top
Long-range planning
Middle
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Tactical planning
Supervisors
Operational matters
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posted on a website, in whole or part.
Information Flow Levels
Each level of management has different information
needs.
Require information flows from different levels
from different directions
Top Managerial-Level Information Flow
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Vertical, horizontal, and external
Middle Managerial-Level Information Flow
Vertical and horizontal
Supervisory-Level Information Flow
Primarily vertical
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posted on a website, in whole or part.
Information Flow Pattern
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posted on a website, in whole or part.
Summary of Computer-Based Systems
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posted on a website, in whole or part.
Computer-Based Information Systems
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posted on a website, in whole or part.
Transaction Processing Systems (TPS)
Helps organizations keep
track of routine operations
and records these events
in a database.
Records day-to-day
transactions in a database
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Also called data
processing systems (DPS)
One of the most essential
uses of a TPS is in
Accounting
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posted on a website, in whole or part.
TPS for Accounting
Sales order processing
Records the customer requests
Accounts receivable
Records money received from or owned
Inventory
Parts and finished goods in stock
Purchasing
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Buying of materials and services
Accounts Payable
Money the company owes
Payroll
Activity involving employer paychecks
General Ledger
Keeps track of all summaries of all the above referenced items
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posted on a website, in whole or part.
Management Information Systems
(MIS)
Computer-based information systems
that:
Produce standardized reports to support
decision-making by middle managers
Integrate data and summarizes details
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from databases in a structured form
Produce predetermined reports
Periodic reports – produced at regular intervals
Exception reports – call attention to unusual
events
Demand reports – produced on request
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posted on a website, in whole or part.
Decision Support Systems (DSS)
Flexible tool for analyzing data for decision-making
purposes
Enables managers to get answers to unexpected and
generally non-recurring problems
Reports do not have a fixed format
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Microsoft Access is often used to provide an easy front-
end interface
Consists of four parts:
User – anyone who has to make decisions
System software – operating system
Data - both internal and external
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posted on a website, in whole or part.
Decision Models
Give the DSS its analytical capabilities
Three basic types of decision models
Strategic models
Assists top level managers in long-range planning
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Tactical models
Assists middle-managers control the work
Financial and sales promotion planning
Operational models
Assists lower-level managers accomplish the daily activities and
objectives
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posted on a website, in whole or part.
Executive Support Systems (ESS)
Designed for top management
Sophisticated software for presenting, summarizing, and analyzing
data, but specifically designed to be easy-to-use
Provides immediate access to a company's key performance indicators
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posted on a website, in whole or part.
Other Information Systems
Information workers distribute, communicate,
and create information
Data workers
Knowledge workers
Office automation systems (OASs) are designed
primarily to support data workers
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Project managers
Videoconferencing systems
Knowledge work systems (KWSs) create
information in their areas of expertise
Used by OAS systems
Use specialized systems, such as CAD/CAM
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posted on a website, in whole or part.
Expert Systems
Or Knowledge-Based Systems are a type of artificial
intelligence that uses a database to provide
assistance to users
Contains facts and rules to relate these facts distilled
from a human expert
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Systems developed in:
Medicine
Geology
Architecture
Nature
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posted on a website, in whole or part.
Careers In IT
Information systems managers oversee
the work of programmers, computer
specialist, systems analysts, and other
computer professionals
Employers look for individuals with strong
technical backgrounds, with a Master’s
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degree in business
Strong leadership and excellent
communications skills
Information systems managers
can expect to earn from
$95,000 to $125,000 annually
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posted on a website, in whole or part.
A Look to the Future ~ IBM’s Watson
• The Ultimate
Information-Finding
Machine
• As information
amounts increase, it
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is more difficult to
keep up
• Can Watson save us?
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posted on a website, in whole or part.
Open-Ended Questions (Page 1 of 2)
1. Name and discuss the five common functions of most
organizations.
2. Discuss the roles of the three kinds of management in a
corporation.
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3. What are the four most common computer-based
information systems?
© 2017 by McGraw-Hill Education. This proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or
posted on a website, in whole or part.
Open-Ended Questions (Page 2 of 2)
4. Describe the different reports and their roles in managerial
decision making.
5. What is the difference between an office automation system
and a knowledge work system?
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© 2017 by McGraw-Hill Education. This proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or
posted on a website, in whole or part.