Chapter 10 Information Systems

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Chapter 10 Information Systems

Chapter 10Information Systems


Presentation Overview

• The Role of an Information System• Information Systems Classified by Function• Planning and Updating Information System

s• Choosing a New Information System• The Process of Developing a New Informati

on System


The Role of an Information System

An information system is a combination of people, hardware, software, computer networks, and data that organizations use to manage daily and long-term operations.


The Role of an Information System

What role do information systems play in business?

Computer-based information systems offer four key advantages over traditional information systems.

• Improved speed• Improved efficiency• Improved quality• Improved measurability


Information Systems Classified by Function

What are some common functional classifications for information systems?– Distribution management– Office information– Management information– Decision support– Executive support– Factory automation



Distribution Management Systems– Designed to deliver products quicker, cheaper,

and with fewer errors. – The major advantage provided by this type of

system is the reduction of inventory overhead.



In a traditional inventory system, regularly scheduled deliveries move products from warehouse storage to storerooms until they are needed to stock the shelves.



In a just-in-time distribution system, deliveries are smaller and more frequent so that products are only in the storeroom briefly.



In a stockless inventory distribution system, deliveries move products from warehouse storage directly to the shelves with no need for a storeroom.



Office Information System (OIS)– Used to automate office work.– Typically provides the following functions

• Maintaining standard operating procedures• Connectivity• Electronic data processing



Management Information System (MIS)– Provides information that assists in the

management of business operations.– Typically

• Integrates information from different departments or functions into one database

• Provides support to management in the form of regular reports



Decision Support SystemHelps managers make informed business judgments.

• Data modeling provides a simulation of a real-world situation built into a software application.

• A expert system is a sophisticated DSS that attempts to model an expert’s knowledge of a topic.

• An online analytical processing (OLAP) system defines and clarifies methods of handling what-if questions posed to large databases.



Executive Support System (ESS)– Attempts to bring together information from an

entire organization, not just one department or group.

– Supports strategic decision-making by facilitating the creation of high-level summary reports.



Factory Automation and Plant Operations– A computer-aided manufacturing (CAM)

system involves the direct use of computers to manufacture products.

– A computer-integrated manufacturing (CIM) system connects all departments in a manufacturing company.

– A statistical quality control (SQC) system assesses how well a factory is operating.


Planning and Updating Information Systems

What are the effects of upgrading or switching to a computer-based IS?

– Expanded technical staff– Increased information technology costs– Increased profit margins– Enhanced product quality– Reduced clerical staff– Temporary disruption


Choosing a New Information System

What are important factors to consider when choosing a new IS?

– User interface design– Open versus closed system– Niche information system– Turnkey system– System support



• User Interface Design– The interface design should be user-friendly

and intuitive.– Critical information should be readily apparent.

• Open or Closed System?– In an open system, the company’s IT staff can

alter the system or hire a third party to do so.– A closed system must be supported by the

original vendor.



Niche Information System– Serves a specially focused set of customers.– Does not require a lot of training or

technological know-how.– Can be expensive and tends to lag

technologically.



Turnkey System– Contains everything a business needs to get a

new IS up and running.– Usually the best and most expensive.– The services of support people are included.



System Support– Ask whether or not installation, staff training,

and on-site service and repair are included in the package.

– If they are not, these extra costs must be factored into calculations of the total cost.


The Process of Developing a New Information System

The development of information systems follows an ongoing cycle that includes planning, design, implementation, and support.



Gantt charts help to visually communicate the critical steps and schedule for a project.



Designing the System– The functional specification document states

exactly what the IS must accomplish.• This document is usually written first.

– The design specification spells out how these goals will be reached.



Commonly Used Information Systems Software



Implementation– A prototype is a miniprogram that

demonstrates how the system works.• This step is sometimes skipped.

– In the development stage, software programming is done and the technicians ensure that the hardware works.

– Before any system can be installed, hardware and software must be purchased.



Implementation– Once the system is installed, it undergoes beta

testing—a period of rigorous testing to ensure that the system functions as designed.

– User training often occurs at the same time.– Finally, the system must be approved by the

committee or executive overseeing its purchase.



The Support Stage– A system goes into the support stage after it has

been accepted and approved.– A support contract allows users to contact the

systems integrator for technical support, training, and on-site troubleshooting.


On the Horizon

Based on the information presented in this chapter and your own experience, what do you think is on the horizon?

Chapter 10 Information Systems

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