LECTURE THREE

INFORMATION SYSTEMS (IS)

 WHAT IS AN INFORMATION SYSTEM
 An information system is a set of
interrelated components that collects,
stores, analyses and disseminates
information for effective business
decision-making.
 For example, an organization wishes to
increase its profits by boosting its sales.
 In such a case, an information system can help
the organization in making effective sales-related
decisions by providing information on current
market trends, needs and preferences of
customers, availability of substitutes, etc.
 COMPONENTS OF AN IS

 The following are the key components of

information system:
 Hardware: It includes physical devices for
information processing such as computers,
keyboards, mouse, scanners, pen drives,
etc.

 Software: It includes a set of instructions to

direct the computer’s hardware. Software is
broadly divided into two types: operating
system and application software.
 COMPONENTS OF IS..
 Data: It includes facts and observations
(collected from various sources) used by
programs to produce meaningful information.
 People: They are one of the main
components of an information system. People
are responsible for the development and
operation of an information system.
 They can be categorized into two types:
specialists and end users.
 Specialists include system analysts, software developers,
system operators, programmers and other IT personnel.
 On the other hand, end users are individuals (market
researchers, production managers, customers and
accountants) who use information produced by a system for
various purposes.
COMPONENTS OF AN IS
 Procedures: Rules and guidelines that
govern the operation of the system,
including protocols for data entry,
processing, and security.
 TYPES OF IS
 In an organization, information systems
are used at all levels. The main kinds of
information system use in businesses
are :
 Transaction Processing System (TPS)
 Management Information System (MIS)
 Decision Support Systems (DSS)
 Executive Information Systems (EIS)
 Office Automation System (OAS)
 Business Intelligence System (BIS)
 TRANSACTION PROCESSING SYSTEM
 Transaction Processing System (TPS) is a
type of information system that is used
to gather, record, manipulate and
retrieve data related to the day-to-day
business transactions of an organization.
 In simple words, TPS is used by
organizations to record the business
transactions that take place with various
parties such as vendors, suppliers and
customers.
TRANSACTION PROCESSING SYSTEM
 In TPS, there are two ways of processing
transactions: batch processing and real-
time processing.
 In batch processing, data related to
transactions is collected over a period of
time, say a week or a month, and
processed from time to time.
 On the other hand, in real-time
processing, data is processed
immediately once a transaction takes
place.
 TRANSACTION PROCESSING SYSTEM

 One organization may have more than one

transaction processing systems for example billing
system to print invoice for customer, payroll and text
calculation system, raw material requirements
calculations system, Stock control system.
 The daily transaction done by the TPS can help to
upper level management to make decision for the
future business.
 For example, by analyzing customer transaction data
management can identify the customer’s purchasing
behaviors.
 TPS also help to maintain relationship with customers
based on transaction.
 There are many super markets which are using transaction
processing system to maintain their daily transaction.
 MANAGEMENT INFORMATION SYSTEM
 A management information system is a
system or process that provides the
information necessary to manage
organization effectively.
 MIS is planned system of collecting;
processing and storing Management
information system is mainly concern with the
internal source of information in organization.
 Management information system analyzes
data captured from transaction processing
system and creates reports based for decision
making..
MANAGEMENT INFORMATION SYSTEM

 The report generate by MIS will be used by

middle management and operational supervisor.
 MIS is very useful to generate reports for
example, financial statements , inventory status
report, performance report for routine or non
routine processes.
 It is very important to manage the flow of
information in organization for the future
development of the business.
 The Management information system helps to
big organization to manage the information
interchanging between different departments
such as store and distribution center
COMPONENTS OF MIS
 The major components of MIS are:
 People Resources: People are required for
the operation of all information system.
 Data Resources: Database holds processed
and organized data.
 Software Resources: It includes all sets of
information processing instruction.
 Hardware Resources: Include all physical
devices and materials used in information
processing.
 Process: is a step undertaken to achieve a
goal.
 OBJECTIVES OF MIS
 MIS has five major objectives which
include:
 Data Capturing
 Processing of Data
 Storage
 Retrieval
 Dissemination
OBJECTIVES OF MIS
 Data Capturing
 MIS capture data from various internal and
external sources of the organization.
 Data capturing may be manual or through
computer terminals.
 Processing of Data
 The captured data is processed to convert into
the required information.
 Processing of data is done by such activities as
calculating, sorting, classifying, and
summarizing.
 OBJECTIVES OF MIS
 Storage of Information
 MIS stores the processed or unprocessed data for
future use.
 If any information is not immediately required, it is
saved as an organization record, for later use.
 Retrieval of Information
 MIS retrieves information from its stores as and when
required by various users.
 Dissemination of Information
 Information, which is a finished product of MIS, is
disseminated to the users in the organization.
 It is periodic or online through a computer terminal.
 DECISION SUPPORT SYSTEM

 Decision Support Systems (DSS) are

sophisticated computer-based
applications designed to assist decision-
makers in solving complex problems and
making strategic choices.
 By harnessing advanced analytics, data
modeling, and artificial intelligence, DSS
provide invaluable insights, enabling
managers to navigate uncertainties,
explore alternatives, and make well-
informed decisions.
 EXECUTIVE INFORMATION SYSTEM
 Executive Support Systems (ESS) is
another important Types of Information
Systems, which is designed to assist
senior management in strategic
decision-making processes.
 Tailored to the needs of high-level
executives, it provides comprehensive
information from internal and external
sources, enabling leaders to analyze
trends, assess organizational
performance, and formulate long-term
 EXECUTIVE INFORMATION SYSTEM
 For instance, by providing a report on
sales figures of an organization in the
past five years, EIS can help the top
executives of the organization in setting
sales targets for the next three years.
 It presents a report in a graphical format
that can be easily analyzed by top-level
executives in a short period of time.
 OFFICE AUTOMATION SYSTEM
 Office automation systems are systems that help to
improve the productivity of employee who are
responsible to process data and information.
 There are many office automation system exist in market
which can be easily implement in organization to
improve the productivity of employee.
 The examples of the well know office automation system
are Microsoft office, Microsoft works and more.
 OAS helps in optimizing or automating existing office
procedure.
 Most of companies are using office automation system to
create data sheet, reports, and statements. The well known
Office automation system used by most of organizations is
Microsoft Package including MS Office, PowerPoint, and Excel..
 BUSINESS INTELLIGENCE SYSTEM
 Business Intelligence Systems (BIS)
encompasses a set of technologies, applications,
and processes that analyse and transform raw
data into insights which are meaningful.
 This helps businesses to gain a comprehensive
understanding of their operations, customers,
and market dynamics.
 By employing advanced analytics and data
visualization techniques, BIS empowers
organizations to make informed decisions,
identify patterns, and forecast trends, thereby
gaining a competitive edge in the fast-paced
business landscape.
INFORMATION SYSTEM TECHNIQUES IN CAPTURING DATA

 Data capturing is the process of

extracting information from a document
and converting it to a computer-readable
data format for later processing.
 A registration form completed in the
admission office when you visit the hospital
is an example of a data capture form.
 The information you fill out on the
documents, whether digital or paper, such
as your name, ID number, address, and so
on, will be extracted for later processing and
insights.
INFORMATION SYSTEM TECHNIQUES IN CAPTURING
DATA
 The main purpose of data capturing is to be able to
transform information from all sources into a format
that computers can understand.
 The data gathered will reveal insights into how your
organization is doing and how to improve through enhancing
efficiency.
 It may improve business operations by automating the
extraction, categorization, and validation of pertinent
data, allowing for quicker and more effective
information retrieval.
 Several technology developments, particularly cognitive
technologies such as AI and ML, have increased the
relevance of information capture automation.
 INFORMATION SYSTEM TECHNIQUES IN CAPTURING
DATA

 Document scanners, barcode scanners,

smart card readers, and signature
capture pads are exampled for capture
devices that organizations might utilize
in combination to capture all the
information needed to help make more
informed decisions.
DATA CAPTURE METHODS
 The growth of information technology has resulted in
the majority of data becoming digital, such as
document files, pdfs, electronic forms, emails, videos,
and so on.
 A substantial quantity of data is still created manually,
such as filled paper papers, letters, and work
certificates.
 The two main types of data capture are manual and
automated.
 Manual data capture involves manual input of information
from physical forms into computer systems.
 Automated data capture uses software tools to extract data
from digital sources.
 MANUAL DATA CAPTURE
 The manual data capture process is a
human-centric technique of obtaining
and manually inputting information
utilizing various mediums such as
keyboards, touch displays, and mice.
 This approach is labor-intensive, time-
consuming, and mistake-prone, and it is
only appropriate for organizations with a
small and changeable amount of data.
 AUTOMATED DATA CAPTURE
 Data capture has progressed
dramatically from paper to automatic
data capture technologies such
as Optical Character
Recognition, Robotic Process
Automation, and so on.
 Modern technology enables the capture
of information to be rapid, accurate, and
dependable.
 OPTICAL CHARACTER RECOGNITION

 OCR is a technique that converts

scanned or photographed pictures of
machine-printed characters into
electronic data for processing.
 It is most commonly used in business to
capture documents that are frequently
received in large numbers since this gives
the highest return on investment.
 It is the process of digitizing and
recognizing written or typed content,
and it is essential in turning printed
 INTELLIGENT CHARACTER RECOGNITION

 ICR is the next-generation technology of OCR

that scans documents with handwritten text,
recognizes data from complicated handwriting
styles, and converts it to a digital format.
 Most banks and other financial institutions use
ICR technology to run their businesses.
 The integration of an AI-based self-learning
system known as a neural network provides the
power.
 Using intelligent data capture, a computer
system may learn to recognize letters based on
their shapes. The matching characters are
translated straight into machine-readable form.
OPTICAL MARK READING

 OMR is the scanning of paper to detect the

presence or absence of a mark in a predetermined
position.
 It is used to extract data from documents such as
forms and surveys that have been hand-written.
 It is the quickest and most precise data-collecting
technology. It is also pretty simple to use. This
technology recognizes the presence of a mark
rather than its form.
 OMR can input data faster than 30 keyboard clerks
operating at the same time.
 BARCODES AND QR CODES

 The encrypted information is stored as

barcodes in barcode technology, which is
read by a barcode scanner.
 This is one of the most recent
technologies utilized to collect
information.
 They make it easier to gather
information since they can be scanned
with a smartphone or other device. They
also save a lot of time.
DIGITAL FORMS
 This approach allows for data gathering
via the web or a mobile application.
 It is adaptable and removes the need
for paper forms.
 INTELLIGENT DOCUMENT
PROCESSING
 IDP is the next generation of automation,

capable of capturing, extracting, and

processing data from a wide range of
document formats and provides lots
of benefits.
 It employs artificial intelligence (AI)
technologies like as natural language
processing (NLP), computer vision, deep
learning, and machine learning to classify,
categorize, and extract important information,
as well as validate the extracted data.