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Business Information System

Name: Mohmedfaizal Kadri Roll No. : D-302422Assignment No.: 01 (Components of IS) Date: 02nd January, 2013

INTRODUCTION :

Information System is Combination of two; (A) Information and (B)

System which consists of all important components like people, process, Applications, Data,

technology and many more that a firm needs to use in order to achieve its business objectives.

You can see now a days Information system becomes very essential in the every organization.

Information systems are more complex which can be understood by looking at them from both

a technology as well as business perspective.

INFORMATION SYSTEM :

An information system plays a very important role in each and every Business

organizations. It represents all the elements involved in the management, processing, transport

and distribution of information within the organization. Like People, process, Applications,

hardware and software. An Information system can simply define as a set of interrelated

components that collect process, store, and distribute information to support decision making,

coordinating, and controlling. It helps the managers and workers in the business organizations

analyzing problems, visualize complex subjects and creating a product. A company creates

value by processing information, particularly in the case of service companies. So, information

has a much greater value because it contributes to achieving the company's objectives. In

practical terms the scope of the term Information System can differ greatly from one

organization to another and depending on the example may cover all or some of the following

elements :

Company databases,

Integrated management software (ERP),

Client relationship management tool (Customer Relationship Management),

Supply chain management tool (SCM - Supply Chain Management),

Application jobs,

Network infrastructure,

Data servers and storage systems,
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Application servers,

Security devices.

CATEGORIES IN THE INFORMATION SYSTEM :

(1) Transaction process system :

Substitute computer based process for manual procedures which deals with

well-structured process.

(2) Management Information System :

Provides input to be used in the managerial decision process and deals with

supporting well structured decision situations and typical information

requirements can be anticipated.

(3) Decision Support system :

Provides information to managers who must make judgements about particular

situations and Decision making which supports decision makers in situations

that are not well structured.

COMPONENTS OF INFORMATION SYSTEM :

Information system consists of five important Components which arefollowing as under :

1) People : Users & end users are the people who interact with an informationsystem, both inside and outside the organizations.

2) Processes : It defines the tasks and business functions that users, managers andIT members perform to achieve specific results.

3) Applications or Softwares : It consists System software, Enterpriseapplications, Horizontal system, Solution systems.

4) Data : It consists Tables, Huge raw data, Linking, researches, feedbacks.

5) Hardware : It consistsMachines, Computers, Equipments etc.


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1) PEOPLE :

In every Business organizations qualified people are a vital component

of any information system. Technical personnel include development and operations

managers, business analysts, systems analysts and designers, database administrators,

computers security specialists, and computer operators. In addition, all workers in the

organisation must be trained to utilize the capabilities of information systems. Billions of

people around the world are learning about information systems as they use the web.

Procedures for using, operating and maintaining an information system

are part of its documentation. For example; procedures need to be established to run a payroll

program, including when to run it, who is authorized to run it, and who has access to theoutput.

2) PROCESSES :

The degree of the structure of the process to be automated which is

strongly linked to its predictability. It is also very important component of the information. Its

combination of the information and people which with the help of people, machines,

computers and management solve the problems of the organization which helps in the decisionmaking process also. It is frequently used as a dimension to classify PAISs. Structured process

are easier to support than unstructured processes. More over we can see that smaller process

are easier to support than the larger processes.

3) APPLICATIONS / SOFTWARES :

System application as well as system software is the part of computer

system. Both are equally important components in the information system. The main principal

system software is the operating systems which manages the hardware, data and program files

and other system resources and provide means for the users to control the computer generally

via a graphical user interface GUI. Where on other side application software is programs

designed to handle specific tasks for users. For example; Ms Office, Tally, Ms Excel,

Graphical applications like Photoshop etc. As well as vertical applications that serve a specific

industry segment for instance, an application that schedules, route, and tracks package delivers

for an overnight carrier.

Most of the organizations use licensed applications, customising themto meet their specific needs and develop other applications in house or on an outsourced basis.

Organizations may also use applications delivering as software-as-a-service SAAS over on the


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web. Main proprietary software available form and supported by its vendors is being

challenged by open source software available on the web.

4) DATA :

Primarily, many Information systems are the delivery vehicles for raw

data in the databases. Database can be defined as a collection of interrelated raw data (records,

previous tables, facts, researches etc.) organised so that individual records and group of

records can be retrieved to satisfy various criteria. For example; employee records and

product catalogues. Database helps and supports the operations and management functions of

the organization. Raw data contains the archival data, collected overtime, that can be mined

for information order to develop and introduce a new product in the market, serve the existing

customer better and also research out to potential new customers. Like, anybody ever

purchased something with a credit card, by mail order, over the web are included within such

data collection in the information system.

5) HARDWARE :

In this modern world, even the smallest firms as well as many

households throughout the world, own or lease computers. These personal computers are also

knows as micro computers. Every people may own multiple computers in the form of smart

phones, laptops, Digital tablets and other portable device. Large organizations generally

employ distributed computer system from powerful parallel-processing servers located in data

centres to widely dispersed personal computers and mobile devices, integrated into the

organisational information systems. The cost of hardware has steadily and rapidly decreased

while processing speed and storage capacity have increased vastly. Thus hardware also plays a

very important role into information system.

IMPORTANT EXAMPLES :

A) How a Bank approves commercial loans :

A large banks executive believes that its current methods forapproving commercial loans have resulted in a substandard loan portfolio. They are also under

pressure to increase the banks productivity and profitability. The work system for approving

loan applications from new clients starts when a loan officer works with a new prospect to

identify financing needs. The loan officer helps the client compile a loan application including

financial history and projections. A credit analyst prepares a Loan Write-Up summarizing

the applicants financial history, providing projections explaining sources of funds for loan

payments and discussing market conditions and the applicants reputation. Each loan is ranked

for riskless based on history and projections. Senior credit officers approve or deny loans of

loan less than $ 4, 00,000; a loan committee or executive loan committee approves larger

loans. The loan officer informs the loan applicant of the decision. A loan administration clerk

produces loan documents for approved loans.


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B) How a software vendor tries to find and qualify sales prospects :

A software vendor sells human resources software to small and

medium sized enterprises. It receives initial expressions of interest through inquiries from

magazine ads, web advertising and other sources. In addition to cold calling using industry

phone lists, a specialized sales group contacts leads from other sources and asks questions to

qualify them as potential clients who might be interested in buying or using the software. A

separate outside sales force contacts qualified prospects, discusses what the software can do

and tries to negotiate a purchase or usage deal. The companys managers are concerned that

the sales process is inefficient that it misses many good leads and that the prospect lists

received by the outside sales group contain too many unqualified prospects.

IMPORTANCE OF INFORMATION SYSTEM IN THE

BUSINESS ORGANIZATIONS :

We can see that that not only beneficial to the organizations only but

also to the customers and users. From a technical perspective, an information system

collects, stores, and disseminates information from an organizations environment and

internal operations to support organizational functions and decision making,

communication, control, analysis, and visualisation. Information systems transform raw

data into useful information through three basic activities; input, processing and output.

From business perspective, an information system provides a solution to

a problem or challenge facing a film and represents a combination of management,

organization and technology elements. The management dimension of information

systems involves issues such as leadership, strategy, and management behaviour. The

technology dimension consists of computer hardware, software, data, management

technology and networking or telecommunications technology. The organization

dimension of information system involves issues such as the organizations hierarchyfunctional specialties, business process, culture and political interest groups.

It deals with issues and insights contributed from technology fromtechnology and behavioural disciplines. The disciplines that contribute to the technicalapproach focusing on formal models and capabilities of systems are computer science,management science and operation research. The disciplines contributing to the

behavioural approach focusing on the design, implementation, management, and businessimpact of systems are psychology, sociology and economic. A sociotechnical view ofsystems considers both technical and social features of systems and solutions that

represent the best fit between them.


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