Business Information System

Name: Mohmedfaizal Kadri Assignment No.: 01 (Components of IS) Roll No. : D-302422 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 are following as under :

1) 2) 3) 4) 5)

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

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

Applications or Softwares : It consists System software, Enterprise

applications, Horizontal system, Solution systems.

Data : It consists Tables, Huge raw data, Linking, researches, feedbacks. Hardware : It consists Machines, 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 the output.

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 decision making 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 them to 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 for approving 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 hierarchy functional specialties, business process, culture and political interest groups. It deals with issues and insights contributed from technology from technology and behavioural disciplines. The disciplines that contribute to the technical approach 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 business impact of systems are psychology, sociology and economic. A sociotechnical view of systems considers both technical and social features of systems and solutions that represent the best fit between them.

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