Types Of Information Systems And Its Applications

Importance of Information System

Discuss about the Types of Information Systems and its Applications.

Information system can be defined or explained as the organization of hardware, people, software, resources, networks of communications and several policies and protocols. The information systems are applicable in case of storing, managing, processing and retrieving information in the business organization. The most important aspect of information system is the communication of information throughout the organization in an orderly manner. There are several types of information systems that are required for the purpose of running a business.

This report discusses about the various types of information systems that are available to the organizations. It points out the application of each of them in brief. It also focuses on the application of these information systems in the area of various types of business. In this era of technology, information system has become an essential and integrated part of the business. A business cannot run or grow with manual labor. This report also points out the essential requirements of information system in the continuity of business.

The importance of information system is very high (Al-Mamary, Shamsuddin & Aziati, 2014). This generation of technology needs information system to keep the operational flow of the organization in a proper way.

• The efficiency of businesses is improved by utilizing the information system in an orderly manner. Several projects can use information system to improve the operational efficiency of the project. Suppose the amount of stock needs to be recorded without any error. This can be well performed by information system.
• New products and services can be easily developed with the help of information system. A new project can be completed at a much faster pace because of the information system. The project plan will be successful by deploying any information system because it will be very simple process to design and develop a new product or business model in an effective manner.
• The reason behind the success of any project or company is satisfied customers and satisfies suppliers (Bajdor & Grabara, 2014). A company will be able to generate more revenue and profit because they have generated goodwill in a proper way. Before starting the execution of any project, a company must select a suitable information system. Information system will be able to provide better service to the customers and suppliers resulting in the success of the new project and company.
• The decision making ability of the company is improved. A company is able to make correct decision regarding any plan of the project as well as while selecting a project. Correct decision will lead to correct and better outcome. It will also help to save time and energy of the people of an organization. This will lead to the better productivity of the organizations and will help the business grow.
• The competitive advantage of the organization is improved. Any project will gain competitive advantage over the other projects that are being initiated at the same time. Suppose there are four projects. The one that uses information system will have a competitive advantage over the other three projects.
• The survival of any business or project is important. This can be possible by using information system. Banks have introduced ATM for making it easy for the customers to access the accounts.

These are few of the benefits that information system provides. The importance of the information system is evident from the above mentioned points.

The classification of information systems can be done on the basis of their functionality and operations. Different levels of the organizations need different category of information systems.  The various types of information systems are as follows:

Transaction Processing System: This type of information system keeps the track record of any type of activity that takes place in the operational level of the business. The daily transactional activities are maintained by the transaction processing system. The operational levels of the organizations need this type of information system in order to carry out the daily operations in an effective manner.

Process Control System: There are several processes in an organization. A business needs to monitor the progress of any activity and also monitor the processes in order to develop a business and continue its activity (Rainer et al., 2013). This is a type of information system that comprises of several computer programs as well as devices.

Office Automation System: This is also known as enterprise collaboration system. This is one of the most important and widely used information systems. This system is helpful for managers to keep a track of all the employees and their activities. The daily official works of the employees are also reduced by the help of office automation systems. There is no single level in the organization where this can be used. This information system has helped to automate the manual processes of an organization. The chances of error are less and the productivity is much better.

Types of Information Systems

Management Information System: This is a type of information system that collects data from various departments of an organization and integrates it. This integrated data in presented to the managerial level for helping them to take decisions (Laudon & Laudon, 2016). It also helps in the process of operational management. This system summarizes the entire information of the organization and presents it in a well formatted manner to the various levels in order to make decisions and monitor the activity of the entire business firm.

Decision Support System: This is a type of information system that is made for a particular group in the organization. This helps to solve a decision that is semi structured. This system helps to evaluate several options that are available and select the best option out of it (Zayadskas et al., 2012). It performs calculations, comparisons and selection of any option out of various choices that are available.

Executive Information System: This is a type of system that helps the executives of an organization to access information from internal as well as external sources (Mayer & Weitzel, 2012). They present data in a graphical format. They even have the capacity to provide information in a detailed manner. It gathers information from DSS and MIS also. Strategic as well as tactical decisions can be taken by using EIS.

Expert System: Commercial applications can be built by using the expert system (Kidd, 2012). These are totally based on knowledge and they are responsible for providing advice to the managers in taking any decision. These systems try to emulate the process of human reasoning. They have set of instructions that enable the system to work like a human expert.               

Strategic Information System: This is a type of information system that helps the business to make new strategies for developing and designing new services and products (Galliers & Leidner, 2014).This system helps to provide competitive advantage to the business over its competitors.

Information System on the basis of functional departments: An organization consists of several departments. Each of the department has its own functions.

• Sales and Marketing: This department uses an information system that helps in the efficient and effective sales and marketing activities of the business.
• Manufacturing and Production: This department uses an information system that helps to keep track of daily record and point out any type of inefficiencies that exist in the organization (Kumar, 2013).
• Finance and Accounting: This department handles the financial data of the entire organization. The information system used in the organization assesses the cash, investment, shares of the company (Romney & Steinbart, 2012). It helps in capital budgeting and making balance sheet in a fast and effective manner.

Research Projects: These are the type of projects where the organization has to find out details regarding one specific area or topic (Bell, 2014). Feasibility study is required. Here management information plays a vital role. Information from various departments are collected and presented in an effective manner. Decision Support System is also required for making certain crucial decisions.

Application of Information System in Projects

Steel Production and Mining Projects: These types of projects require monitoring of the process that is taking place. Physical processes need to be under surveillance. This type of project requires process control systems.   

Software Development Project: These types of projects require strategic information system, management information system and decision support system (Laudon et al., 2012). These information systems are required for saving time and improving the efficiency of the project procedure. Executive information system helps the software developers to collect information from internal and external sources to come to a decision.

New Product Development Project: The strategic information system plays the most important role in developing and designing any new product, service and business models. It helps to take proper decisions and make proper choices while developing products (Pearlson, Saunders & Galletta, 2016). This is a type of information system that helps the business to make new strategies for developing and designing new services and products. This system helps to provide competitive advantage to the business over its competitors.

Construction Project: This type of project requires the process control information system in order to carry out a safe and efficient construction project (Sears et al., 2015).

System Installation Project: These are the types of projects that require the installation of an IT system or a telephone system. Strategic information system and process control system play a major role in this project (Peppard & Ward, 2016).

Transaction processing system and finance and accounting systems are required in every project. In the initial planning stage the budget of a project must be prepared (Stair & Reynolds, 2013). The finance and accounting system allow the project management team to carry out this task in a simple and fast manner. Transaction processing needs to be done so that the record of every activity is done. Executive information system will help the employees to communicate in a proper manner so that it leads to an effective decision.

Conclusion

 This report concludes that there is an essential requirement of information system in this era of technology. There are several benefits of information systems that help the organizations to develop and grow. This report has discussed about several types of information systems and their characteristic. It has also mentioned about the application of the information systems in certain number of projects like construction, software development and many more. This report concludes that information systems can be used in various types of projects. In this era of technology, information system has become an essential and integrated part of the business. A business cannot run or grow with manual labor. This report has also pointed out the essential requirements of information system in the continuity of business.

References

Al-Mamary, Y., Shamsuddin, A., & Aziati, N. (2014). The Role of Different Types of Information Systems In Business Organizations : A Review. International Journal Of Research (IJR), 1(7).

Bajdor, P., & Grabara, I. (2014). The Role of Information System Flows in Fulfilling Customers’ Individual Orders. Journal of Studies in Social Sciences, 7(2).

Bell, J. (2014). Doing Your Research Project: A guide for first-time researchers. McGraw-Hill Education (UK).

Galliers, R. D., & Leidner, D. E. (Eds.). (2014). Strategic information management: challenges and strategies in managing information systems. Routledge.

Kidd, A. (Ed.). (2012). Knowledge acquisition for expert systems: A practical handbook. Springer Science & Business Media.

Kumar, N. (2013). Implementing lean manufacturing system: ISM approach. Journal of Industrial Engineering and Management, 6(4), 996.

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Laudon, K. C., Laudon, J. P., Brabston, M. E., Chaney, M., Hawkins, L., & Gaskin, S. (2012). Management Information Systems: Managing the Digital Firm, Seventh Canadian Edition (7th. Pearson.

Mayer, J. H., & Weitzel, T. (2012, January). Appropriate Interface Designs for Mobile End-User Devices–Up Close and Personalized Executive Information Systems as an Example. In System Science (HICSS), 2012 45th Hawaii International Conference on (pp. 1677-1686). IEEE.

Pearlson, K. E., Saunders, C. S., & Galletta, D. F. (2016). Managing and Using Information Systems, Binder Ready Version: A Strategic Approach. John Wiley & Sons.

Peppard, J., & Ward, J. (2016). The strategic management of information systems: Building a digital strategy. John Wiley & Sons.

Rainer, R. K., Cegielski, C. G., Splettstoesser-Hogeterp, I., & Sanchez-Rodriguez, C. (2013). Introduction to information systems. John Wiley & Sons.

Romney, M. B., & Steinbart, P. J. (2012). Accounting information systems. Boston: Pearson.

Sears, S. K., Sears, G. A., Clough, R. H., Rounds, J. L., & Segner, R. O. (2015). Construction project management. John Wiley & Sons.

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Zavadskas, E. K., Vaini?nas, P., Turskis, Z., & Tamošaitien?, J. (2012). Multiple criteria decision support system for assessment of projects managers in construction. International Journal of Information Technology & Decision Making, 11(02), 501-520.