Information systems are more than just computer programs. Though information and communications technologies are playing an increasing role in meeting organizations’ information needs, an information system is a much more general concept. It refers to the wider systems of people, data and activities, both computer-based and manual, that effectively gather, process, store and disseminate organizations’ information. (international Graduate Information System, 2011)
An information system is a collection of hardware, software, data, people and procedures that are designed to generate information that supports the day-to-day, short-range, and long-range activities of users in an organization. Information systems generally are classified into five categories: office information systems, transaction processing systems, management information systems, decision support systems, and expert systems. The following sections present each of these information systems.(Cashman and Vermaat, 1999)
Type of Information Systems
- Transaction Processing Systems
A transaction processing system (TPS) is an information system that captures and processes data generated during an organization’s day-to-day transactions. A transaction is a business activity such as a deposit, payment, order or reservation.
Clerical staff typically perform the activities associated with transaction processing, which include the following:
- Recording a business activity such as a student’s registration, a customer’s order, an employee’s time card or a client’s payment.
- Confirming an action or triggering a response, such as printing a student’s schedule, sending a thank-you note to a customer, generating an employee’s paycheck or issuing a receipt to a client.
- Maintaining data, which involves adding new data, changing existing data, or removing unwanted data.
Transaction processing systems were among the first computerized systems developed to process business data – a function originally called data processing. And usually, the Transaction Processing System computerized an existing manual system to allow for faster processing, reduced clerical costs and improved customer service.
The first transaction processing systems usually used batch processing. With is the batch processing, transaction data is collected over a period of time and all transactions are processed later, as a group. As computers became more powerful, system developers built online transaction processing systems. With the online transaction processing (OLTP) the computer processes transactions as they are entered. When you register for classes, your school probably uses OLTP. The registration administrative assistant enters your desired schedule and the computer immediately prints your statement of classes. The invoices, however, often are printed using batch processing, meaning all student invoices are printed and mailed at a later date.
Most transaction processing systems use online transaction processing. Some routine processing tasks such as calculating paychecks or printing invoices, however, are performed more effectively on a batch basis. For these activities, many organizations still use batch processing techniques. (Cashman and Vermaat, 1999)
2. Management Information Systems
While computers were ideal for routine transaction processing, managers soon realized that the computers’ capability of performing rapid calculations and data comparisons could produce meaningful information for management. Management information systems thus evolved out of transaction processing systems. A management information system, or MIS (pronounced em-eye-ess), is an information system that generates accurate, timely and organized information so managers and other users can make decisions, solve problems, supervise activities, and track progress. Because it generates reports on a regular basis, a management information system sometimes is called a management reporting system (MRS).
Management information systems often are integrated with transaction processing systems. To process a sales order, for example, the transaction processing system records the sale, updates the customer’s account balance, and makes a deduction from inventory. Using this information, the related management information system can produce reports that recap daily sales activities; list customers with past due account balances; graph slow or fast selling products; and highlight inventory items that need reordering. A management information system focuses on generating information that management and other users need to perform their jobs.(Cashman and Vermaat, 1999)
Concepts for a Connected World by Shelly, Cashman and Vermaat; Course Technology 1999
International Graduate Information System
