Module 1

organization & Information system

Data
Data refers to facts usually collected as a result of experience, observation, or process within a computer system. Data might be numeric, words or images, particularly as measurement of a set of variables.

Information
Information is processed data, which has been placed in a meaningful & useful context for an end user.
DATA STORAGE

DATA

PROCESSING

INFORMATION

EXAMPLE OF PROCESSING OF DATA INTO INFORMATION

TOTAL DAILY

EXPENSES

WRITE IN A DAIRY
STORED DATA

ADD EXPENSES EACH DAY

PROCESSING

EXPENSE TO
BUDGET
INFORMATION

DATA

Example OF expenses made by a Family:

Total Monthly Income

EXPENSES ON MILK
MONTHLY INCOME
Monthly Expenses On Milk (Input Data)

Proportion Of Income spent on Milk (Output Information)

Difference Between Data & Information

DATA INFORMATION

Knowledge derived from study, Facts, Statistic used for reference or experience & statistics. (EX: Milk analysis. (EX: Expenditure Made) Expenses on monthly basis)

Numbers, Characters, Symbols. Communication of intelligence Which can be processed by a derived from processed output of computer. computer.
Information is nay kind of Data must be interpreted by a Knowledge that is exchangeable human or machine, to derive amongst people, about things, facts, meaning. concepts, etc., in some context.

Categorization of Information
1. Classification on Characteristics:
Action Versus No-Action Information: Information which induces
action is called Action Information. Information which only communicates only the status of a situation is called Non-Action Information.

Recurring Versus Non-Recurring Information: Information which is

generated at regular interval is Recurring Information. Ex: Sales Report. The financial analysis or the report on the market research study is NonRecurring Information.

Internal Versus External Information: information generated through

internal sources are known as Internal Information. Information generated through Government Reports, industry survey is termed as External Information. Timing & Accuracy of Action data should be checked due to outdateness of the data.

2. Classification on Application:
Planning Information: Information which are used in planning of an
activity is called Planning Information. EX: Time Standard, Design Standard.

Control Information: Reporting the status of an activity through a

feedback mechanism is called Control Information.

Knowledge Information: A collection of information through the

library reports & the research studies to build up a knowledge base information. Information can also be classified on the basis of usage. When the information is used by everyone in the organization than it called as organization information. When the information has multiple use & application, it called as Database Information. Information is used for operations of a business it is called as Functional or the operational Information

3. Classification by Management Hierarchy / Level of people & their

Information Needs:
Supervisory Level: Activities are highly programmable & repetitive. The use of
computers are also widespread. EX: scheduling, Daily Planning.

Middle-Level: Managers, Plant Head are responsible for administration &

Coordination. It can be align with top mgmt.

Top-Level: Manager are responsible for overall strategy & policy of orgn.
They are also responsible to interact with outside the organization that is the environment.

Many CEO will retrieve information from IS to take strategic decision.

These enables the organization to make a timely responses to changes in the external environment.

Introduction to Information System

Information system is a set of people, procedure and resource that collects, transforms, and disseminates information in an organization. Information is some tangible or intangible entity that reduces the uncertainty about a state or event. Example: Information that the weather will be good tomorrow reduces our uncertainty about whether or not a baseball game will be played. So, Understanding of Information system is important for managers, business professionals in todays internet worked enterprise.

An Information System can be any organized combination of people, hardware, software, communication networks, and data resources that stores & retrieves, transform, and disseminates information in an organization.

Features of Information System

Accurate & Error free information. Meet objectives of the system.

Information must be gathered from reliable & authenticated

sources. Information system are easily accessible.

While providing accessibility, access security must be maintained.

It must provide timely information when it is needed. Information needs to be made available as per defined frequency. Information should be easily interpret. Ease of usage & understanding.

Need for Information System

1. Meeting Global Challenges: Today world is becoming small place:
the competition faced by a business is no longer limited by national boundaries. Companies therefore strive to produce high-quality goods & services to compete in the market. Globalization provides benefits such as increase profit, market share as well as the challenging threats also. It must effectively coordinate & control products, people and procedures around the world. This requires a great deal of timely, accurate and reliable information.

2. Capturing Opportunities in Marketplace: if company wants

to be successful in the market they have to identify & take advantage of opportunities in the marketplace & can continue to do so over the long-run. Information system that allow a company to identify strategic growth opportunities in the marketplace are known as Strategic Information System. These systems have catapulted some companies to the top of their industries far behind. 3. Enhancing worker Productivity: Help of computers & information systems in business has made them essential tools in many tasks, such as managing shop-floor, evaluating the performance of employees. Computers & Information systems can therefore have significant impact on a companys bottom line.

4. Linking Department whoses functions are different:

Traditionally departments or units with different functions are
called as a separate business entities. Like HR, Finance, Mktg. Often the efforts made were not coordinated or integrated that

will lead to inefficiencies & lost opportunities for the company.

But today most of the organization treat these apparently different departments as part of a cohesive units whose members must work together to achieve the overall goal of organization. IS can bring different functioning units together by coordinating their task & functions.

5.Supporting Corporate Strategy: company uses 3 basic

strategies to compete successfully in the market; They compete in the market by providing lower cost products. They provide high-quality or unique products that allow them to stand apart from their competitors. Focusing or niche mkt to meet the need of special group. Company can also use these strategy in combination. So IS & Technologies play an important role in the implementation of business strategy.

6. Increasing Quality of Goods & Services: TQM is one of the

most popular & most widely used approaches for enhancing quality in an organization. This decisions requires intensive information to achieve its quality goals by providing right information to right people.

Components / Resources of IS

Model shows that IS depends on five major resources or components:. 1. People Resources: People are the essential ingredient for the successful operation of all information systems it includes: End Users: Also called as clients. They are people who use an information system or information it produces. They can be customers, salesperson, clerks. IS Specialists: people who develop & operate information systems. they are system analyst, software developers, system operators or managerial people. 2. Hardware Resources: it includes all physical devices & material used in Information processing. It not only include machines like computers & equipment nut also intangible objects like paper & optical disk.

 Computer Software: it consist of CPU containing microprocessors & Peripheral devices. Example: laptop, desktop, mainframe computer. Computer Peripherals, are devices such as keyboard, mouse for input of data. a video screen or printer for output of information, magnetic or optical disk for storage of data.
3. Software Resources: it includes all sets of information processing instructions. System Software, such as an operating system program, which controls & supports the operations of computer system. Application Software, which are programs that direct processing for particular use of computers by end users. Example: sales analysis program, a payroll program. Procedures, which are operating instruction for the people who will use an information system. Example: instruction for filling out a paper form.

4.Data Resources: the concept of data resources has been broadened by managers & information systems professionals. They realized that data constitute valuable organizational resources. So that should be managed effectively that will benefit organization. Data can take many forms, including traditional alphanumeric data. Text data, consisting of sentences & paragraphs used in written communications. Image Data, such as graphic shapes & figures & video images, and audio data, the human voice & other sounds.

5.Network Resources: telecommunication technologies and networks like internet, intranet, and extranets are essential to the successful electronic business. Telecommunications networks consists of computer communications processors, & other interconnected by communications media & controlled by communication software. Communications Media: include twisted-pair wire, coaxial & fiber-optic cable; and microwave, cellular & satellite wireless technologies. Network Infrastructure: emphasizes that many hardware, software, and data technologies are needed to support he operation and use of a communications network. Example: communications processors such as modems & internetwork processors, and communications control software such as network operating systems & internet browser packages.

Role of Information Systems

Support Competitive Advantage

Support Business Decision Making

Support of Business Processes and Operations

1.Support Business Processes & Operation: As a consumer, you

have to deal regularly with the information system that support the business processes & operations at many retail stores where you shop. Example: most retail stores now uses computer-based information systems to help them to record customer purchases, keep track of inventory.

2.Support

it also helps the business professionals in making better and attempt to gain a competitive advantages. Example: Help mktg manager in taking decision on what lines of merchandise need to be added or discontinues, OR on what kind of investment they require, are typically made after an analysis provided by computerized-based information system.

Decision-Making:

3.Support Competitive Advantage: use of IS will helps

organization in gaining competitive advantage innovatively. Example: store mgmt. might make a decision to install touch-

screen kiosks in all of their stores, with links to their E-Commerce

websites for online shopping. it helps in attracting new customers & build customer loyalty.

Capabilities of Information System

1. Provide fast & Accurate Transaction Processing: company
has to record their day-to-day transaction. It generate data. These data must be accurately & quickly maintained. This process is called Transaction Processing & IS which records, store & update, these data are called Transaction Processing System

2. Provide Large Capacity: it has the capabilities of storing huge

amount of data on a network which can be retrieved & shared on the network.

3. Provide Fast Communication: Network enables organizational

employees & Computers almost instantly around the world.

4. Reduce Information: effectively data can be managed &helping

in making strategic decision to business professionals.

5. Span Boundaries: IS span boundaries inside organization as well

as between organization along entire supply chain. Inside organization, Boundary spanning facilitates decision-making across cross-functional areas and communication. Supply Chain, it facilitates shorten cycle times for product delivery, reduce inventory, and increase customer satisfaction.

6. Provide support for Decision-making: DSS helps decision

makers at every level of organization. DSS, EIS helps to make strategic decision.

7. Provide Competitive Weapon: helps in gaining competitive

advantage over the competitors.

Challenges of Information System

IS has brought revolution in business world for getting its maximum benefits. So business has to restructure & redesign there IS architecture.

1. Globalization Challenges: it deals with identification of business &

system requirements to survive in the globalized economy. So to meet the globalized challenge effectively, one has to develop integrated multinational information system that allow them to create cross-cultural accounting &reporting structure.

2. Information Architecture Challenges: it deals with what should

be the architecture design of the IS to achieve overall goal of the organization. Many company could not achieve due to incompatibility of hardware, software & information system.

3. Strategic Business Challenges: it deals with how to get maximum

profit from IS to make an organization competitive & effective.
In India, when most of the new hardware &software it becomes outdated in rest of the world.

So India has to redesign their Information Technologies to compete.

4. Responsibility &Control Challenges: one has to see that IS are

ethical & socially responsible & can the system be controlled or not controlled by the people? One has to give special attention to ensure that is, are accurate, reliable, secure & protect correct information. IS should be such that it protects the right of privacy, job security of the employees and so on.

Decision Making Process: Herbert Simon

Phase1 Intelligence: search for & identify conditions requiring a
decision. IS should scan the internal organization & the external environment & help identify problems & opportunities.

Phase-2 Design: Develop & Evaluate alternative courses of action.

Information system should help generate & evaluate decision alternatives.

Phase-3 Choice: select a course of action & monitor its implementation.

Information system should help emphasize & prioritize decision alternatives & provide feedback on the implemented decision.