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STU96831 10/12/2022 /3000Information Systems in Organisations
Types of Information Systems in Organisations
Successful organisations large and small leverage available technologies to manage
business activities and assist in making decisions. They use information systems to
collect data and process it according to the needs of the analyst, manager or
business owner. Businesses operate more efficiently by using varied information
systems to interact with customers and partners, curtail costs and generate
revenues.
Transaction Processing Systems
Transaction processing systems (TPS) meet the data collection, storage, processing
and outputting functionalities for the core operations of a business. TPS
information systems collect data from user inputs and then generate outputs
based on the data collected. An example of TPS system could be an online air ticket
booking system.
In such a system, travellers select their flight schedule and favourite seats (the
input), and the system updates the seats available list, removing those selected by
the traveller (the processing). The system then generates a bill and a copy of the
ticket (the output). TPS information systems can be based on real-time or batch
processing, and can help business owners meet demand without acquiring
additional personnel.
Customer Relationship Management Systems
Business owners use customer relationship management (CRM) systems to
synchronize sales and marketing efforts. CRM systems accumulate and track
customer activities, including purchasing trends, product defects and customer
inquiries. The capabilities of typically CRM information systems allow customers to
interact with companies for service or product feedback and problem resolutions.
Businesses may also use CRM systems internally as a component of their
collaboration strategies. As such, CRM information systems allow business partners
to interact with each other as they develop ideas and products. Collaboration can
occur in real time even when business partners are in remote locations.
Business Intelligence Systems
Business intelligence systems (BIS) can be complex as they identify, extract and
analyze data for various operational needs, particularly for decision-making
purposes. BIS information systems may provide analyses that predict future sales
patterns, summarize current costs and forecast sales revenues.
Business intelligence systems collect data from the various data warehouses in an
organization and provide management with analyses according to lines of business,
department or any breakdown that management desires. For example, financial
institutions use BIS systems to develop credit risk models that analyze the number
and extent of lending or credit given to various sectors. These systems may use
various techniques and formulas to determine the probability of loan defaults.
, STU96831 10/12/2022 /3000
Knowledge Management Systems
Knowledge management systems (KMS) organize and dissect knowledge and then
redistribute or share it with individuals of an organization. The purpose of these
information systems is to bring innovation, improve performance, bring integration
and retain knowledge within the organization. Although KMS information systems
are typically marketed to larger enterprises, small businesses can also benefit from
harvesting knowledge. KMS information systems serve as a central repository and
retain information in a standard format. These systems can help business owners
maintain consistency and enable speedy responses to customer and partner
inquiries.
Small businesses are chiefly concerned with getting and keeping customers by
producing quality goods or services. Business owners are also faced with the
considerable challenge of turning mountains of data into actionable information.
Information on sales, client lists, inventory, finances and other aspects of your
business needs to be carefully managed. Your information systems can also be
important sources of insight for growing your business by containing costs and
achieving a competitive advantage. To best leverage data as a company asset,
adopt a formal information strategy for your business.
Transaction Processing System
A small business processes transactions that result from day-to-day business
operations, such as the creation of paychecks and purchase orders, using a
transaction processing system, or TPS. The TPS, unlike a batch system, requires
that users interact with the system in real time to direct the system to collect,
store, retrieve and modify data. A user enters transaction data by means of a
terminal, and the system immediately stores the data in a database and produces
any required output.
Management Information System
Small-business managers and owners rely on an industry-specific management
information system, or MIS, to get current and historical operational performance
data, such as sales and inventories data. Periodically, the MIS can create
prescheduled reports, which company management can use in strategic, tactical
and operational planning and operations. For example, an MIS report may be a pie
chart that illustrates product sales volume by territory or a graph that illustrates
the percentage increase or decrease in a product's sales over time.
Small-business managers and owners also rely on the MIS to conduct “what-if” ad
hoc analyses. For example, a manager might use the system to determine the
potential effect on shipping schedules if monthly sales doubled.
Decision Support System
A decision-support system, or DSS, allows small-business managers and owners to
use predefined or ad hoc reports to support operations planning and problem-
resolution decisions. With DSS, users find answers to specific questions as a means
to evaluate the possible impact of a decision before it is implemented. The answers
to queries may take the form of a data summary report, such as product revenue
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