QUESTION 1

evaluate the role of information system in your organization/work/life.

1)name one system and do presentation slide(max 5 page only slide)

a)name one system and briefly explain its role/functions;and

b)discuss its advantages and disadvantages.

Question 2

discuss 3 major challenges that managers typically face in building

and/or using information system and elaborate the way to overcome
those challenges.

instruction:you are required to write a minimum of 15 pages(maximum

of 30pages)

a) Name one system and briefly explain its role/functions

THE IMPLEMENTATION OF SYSTEM INTEGRATION ACTIVITIES IN
BANKING.

INTRODUCTION
Banking as such has undergone a sea of change in the past couple of decades, the
hassles of obtaining a Demand Draft/Travellers cheque, the infinite wait to get interbank
cheques cleared, waiting in long queues to deposit and withdraw money, having to pay
exorbitant amounts as fee for wired transfer between different branches of the same bank,
all these have changed drastically for the better, giving the customers and the bankers
more flexibility and speed. It has also opened up online banking, mobile banking, what
we now refer to as plastic money for shopping which has made life a lot easier. It has
enabled us to book tickets on trains/buses/airplanes on the click of a mouse (not literally
so though). Gone are the days one received a salary in an envelope or a cheque, now its
all about wired transfer. All these have been made possible because of the extensive use
of Information Technology. In this report I will be exploring on how IT and System
Integration has changed the banking landscape for good.
Banking in Malaysia
In Malaysia essentially after the deregulation, many foreign banks and private
banks got a foothold in Malaysia, bringing with them the latest technology which gave
them a competitive edge over the public sector banks, which pushed the till then
inefficient public sector banks to embrace Information Technology or fade into
obsolescence ignoring it. Also the RBI had taken up a lot of initiative to ensure that banks
adopted Information technology which essentially made the whole business more
transparent, and easier to regulate.

Banking has essentially been using IT for two purposes for communication and for
business processes. We receive automatic updates of any transaction on our accounts
through mobiles. When we swipe our card, make a withdrawal in an ATM or swipe our
card in a shop, we get instant updates on our mobiles thus ensuring safety, minimizing
our losses in case we lose our cards, or chequebooks etc. Information is available anytime
anywhere, IT has facilitated the Intra-bank and Inter-bank integration, eased the flow of
information in a safe and secure manner. Initially customers were able to transact only

with one branch, as the account information was not stored in a centralized location,
which was not an option as long as paper based accounting procedures were used, as
storage and duplication were deterrent factors. With the advent of IT centralized storage
of information was an option and with the fast paced changes in related fields which
makes storage, retrieval and duplication not only faster but also cheaper. Thus by using
IT productivity was improved manifold and costs were driven down. Now data can be
easily access and analyzed foregoing the earlier time consuming processes. IT has
improved operational efficiency and facilitated quicker and more accurate decision
making, accurate decisions are facilitated by bypassing the intermediaries which could
input errors in the information(in the form of reports) passed to the decision makers.
One of the solutions is E-pay. E-pay banking solutions are experts in adding enhanced
functionality to existing bank hardware. E-pay provides solutions for some of the biggest
banks in Malaysia and all over the world. Our software solutions ensure secure, flawless,
integration of E-pays popular product suite into existing EFTPOS and banking Points
of Sale (POS).

New Product/Services enabled by use of Information Technology and system Integration

Net Banking
Credit Card Online
Mobile Banking
NetSafe
Phone banking
Online Bill Payment
Online payment of Income Tax, Excise Duty and Service Tax
Shopping
Ticket Booking
Card to Card Transfers
Smart Money order
Bank@Home
eCheques
Prepaid Mobile Recharge

Electronic Clearing Service (ECS Credit)

ECS Credit is an electronic clearing system that facilitates paperless transaction through
an offline system. Bank facilitates ECS Credit at all ECS designated locations. We accept
the electronic file and arrange obtention of settlement date (date of credit to benefiary
account) from RBI/SBI/Local Clearing House as the case may be. The funds gets debited
from a centralized account and credit is accorded to the respective beneficiaries as per
settlement cycle. A detailed MIS about the transactions is provided to the customer.

NEFT
To establish an Electronic Funds Transfer System to facilitate an efficient, secure,
economical, reliable and expeditious system of funds transfer and clearing in the banking

sector throughout Malaysia. The customer willing to avail the NEFT facility offered by us
shall submit an "NEFT Application Form" authorising the sending bank to debit the
sender's account and transfer funds to the beneficiary specified in the NEFT Application
Form. The Beneficiary's account will be credited on the same day by crediting the
specified account of the beneficiary or otherwise placing funds at the disposal of the
beneficiary.

ORGANISATION TRANSACTION PROCESSING SYSTEM

Web Commerce or Ecommerce has witnessed a significant increase in revenue year on
year. You can now integrate this option to your website in the various Secured Payment
Gateway Options we have to offer. Technologies are the authorized reseller for (i.e
Maybank) Bank Payment Gateway Services in the state.

Management Information System (MIS) in Banking Institution

The term is not new to the banking sector. Since the early 80s, banks have been using
this terminology to refer to the process of generating various reports and analyses at the
Corporate/Head offices for their decision making for own use as well as for conveyance
to authorities in charge of regulation
MIS in the present context of high availability of voluminous data on electronic media
at diverse locations and on diverse platforms, has become more pertinent to banks
decision-making process, thanks to the availability of new tools of technology such as
data warehousing, data mining
Management Information System would thus be the end product of both the processes data warehousing and data mining.

Relevance of Data Warehousing and Data Mining for banks in

Malaysia

Banking being an information intensive industry, building a Management

Information System within a bank or an industry is a gigantic task. It is more so for the
public sector banks which have a wide network of bank branches spread all over the
country
At present, banks generate MIS reports largely from periodic paper reports/
statements submitted by the branches and regional/zonal offices. Except for a few banks
which have been using technology in a big way, MIS reports are available with a
substantial time lag. Reports so generated have also a high margin of error due to data
entry being done at various levels and the likelihood of varying interpretations at different
levels Though computerization of bank branches has been going on at a good pace,
MIS requirements have not been fully addressed to. It is on account of the fact that most
of the Total Branch Computerization (TBC) software packages are transaction processing
oriented. They have been designed primarily for day-to-day operations at the branch level
and day-end balancing of books.

Application of data warehousing and data mining techniques

Implication of adopting such technology in a bank would be as

under

1. All transactions captured at the branch level would get consolidated at a central
location. Such a central location could be called the Data Warehouse of the
concerned bank
2. For banks with large number of branches, it may not be desirable to consolidate
the transaction details at one place only. It can be decentralised by locating the
services on regional basis.

3. By way of data mining techniques, data available at various computer systems

can be accessed and by a combination of techniques like classification,
clustering, segmentation, association rules, sequencing, decision tree (described
in detail at Annexure-15), various ALM reports such as Statement of Structural
Liquidity, Statement of Interest Rate Sensitivity etc. or accounting reports like
Balance Sheet and Profit & Loss Account can be generated instantaneously for
any desired period/date.

FUTURE DEVELOPEMENT IN BANKING SYSTEM

New mobile payment method

Bank is in advanced stages of beta testing a new method of using mobile phones
to make payments. If this mobile payment method is implemented, users can
swipe their mobile phone and conduct various transactions, which were earlier
possible using the credit cards.
Organization transaction processing system
Transaction Processing System:
A Transaction Processing System (TPS) is a type of information system.
TPSs collect, store, modify, and retrieve the transactions of an organization. A transaction
is an event that generates or modifies data that is eventually stored in an information
system. From a technical perspective, a Transaction Processing System (or Transaction
Processing Monitor) monitors transaction programs, a special kind of programs. The
essence of a transaction program is that it manages data that must be left in a consistent
state.
TPS in Standard chartered bank:
Effective transaction processing system is working in Standard chartered
bank that offer enterprise the means to rapidly process transactions to ensure the smooth
flow of data and the progression of processes throughout the enterprise.

Payroll TPS
In Standard Chartered payroll TPS is designed to get information and record
of the employ and then to calculate his/her annual earning.
It get information about the employee from the employees department and
from general ledger and send it to payroll TPS from where it links that information with

the previous record and prepare a report which is forwarded to management.

Management takes notice the LN record of the employees efficiency to work and may
declare added bonus or other incentive. This report is checked and approved by the
branch manager after which check is issued to the employee. And when that check is
cashed, the record is updated in the general ledger as well as the master payroll (HUB).

Employee Data

Payroll TPS

Management Reports

Check Passes by Manager

General Ledger
L

Check Issued to Employee

Payroll Master File (HUB)

General Ledger
L

Relationship of MIS with TPS:

MIS reports and summarizes the organizations basic operations and these reports come
from the basic transition processing systems. In case of our organization the TPSs of
ATM Cards, Payroll and Customer identification etc. provide the basic information about
the organizations activities. These activities are then summarized in the form of reports

for the manager so that they can check whether the firm is working properly or not. If
there are some flaws then they take control measures to fix those flaws.

ORGANISATION TRANSACTION PROCESSING SYSTEM

Web Commerce or Ecommerce has witnessed a significant increase in revenue year on
year. You can now integrate this option to your website in the various Secured Payment
Gateway Options we have to offer. Technologies are the authorized reseller for Maybank
Bank Payment Gateway Services in the state.

How it Works?

b) Discuss its advantages and disadvantages.

A transaction processing system is a computer database system that
balances and controls purchases of goods and services within a business
network. A common example may be a consumer purchasing a product on
an online store. The transaction processing system coordinates the
warehousing and distribution of the item, the credit and bank transaction
from the consumer's payment account, and the business's management of
inventory, sales, profits and payroll. This complex system has many
advantages and disadvantages.

ADVANTAGES
Database Stability
The Advantage TPS maintains database stability in the event of workstation or
network failure. Should a workstation or the network fail during a transaction, a
transaction that is being committed will finish to completion, and an uncommitted
transaction will automatically be rolled back. If the file server crashes during a
transaction, the Advantage TPS log files are used when the Advantage Database
Server is reloaded to return the database to a known state.
Data Hiding (Read Committed Isolation Level)
The Advantage TPS uses the Read Committed Isolation Level to build
robustness into database applications by only allowing visibility of committed
data. While updates are being made within a transaction, the Advantage TPS
hides those updates from other users until that data is committed. The
uncommitted data is visible only to the application performing the transaction.
The other applications view the data as it was before the transaction began. If the
transaction is rolled back, the uncommitted data is never seen by any users other

than the one who was performing the transaction. If the transaction is committed,
the updated data becomes visible to all users at one time.
Recovery from System Failures
Automatic recovery of your database to a known state after a system failure is a
key feature of the Advantage TPS. System failures in this context are server
failures, such as operating system read or write errors. How the Advantage TPS
handles system failures depends on what phase the transaction was in when the
system failure occurred.
A transaction can be in one of three phases: the Build Phase, the Commit Phase,
or the Rollback Phase. The Build Phase is active as insert, update, and delete
operations are being issued by the application. These operations are logged to
the transaction log file by the Advantage TPS during this phase. The Commit
Phase occurs after the Advantage application issues a commit transaction
statement. This signals the Advantage TPS to begin writing the database updates
that are stored in the transaction log file to the tables and index files. The
Rollback Phase occurs after the Advantage application issues a rollback
transaction statement. This signals the Advantage TPS to abort all database
updates that are stored in the transaction log file. The database is left exactly as
it was before the transaction began.
If a system failure occurs during the Build Phase, the Advantage TPS aborts only
the insert, update, or delete operation that was in progress. The database is left
as it was before the individual operation occurred and the transaction remains in
the Build Phase. An error is returned to the application indicating that the insert,
update, or delete operation failed.
If a system failure occurs during the Commit Phase, the Advantage TPS puts the
transaction into the Rollback Phase. The entire transaction is aborted (rolled
back). The database is left as it was before the transaction began and the

transaction is complete. An error is returned to the application indicating the

transaction was rolled back.
If a system failure occurs during the Rollback Phase, a failed transaction results.
The tables and index files associated with the transaction will be left in a
temporarily unstable state. An error is returned to the application indicating the
transaction failed. The application needs to recognize this error and attempt a
failed transaction recovery. While the Advantage Database Server is
loaded/started, a failed transaction can be recovered from by calling the
applicable Advantage client "failed transaction recovery" or "TPS cleanup" API.
After the failed transaction recovery is completed, the database will be as it was
before the transaction began. See your Advantage client-specific documentation
for more information about the failed transaction recovery APIs.
Recovery from Server Crashes
Should a server crash due to a power outage, abend, or other critical errors while
one or more applications are in the midst of a transaction, a failed transaction(s)
will result. The tables and index files associated with the transaction(s) will be left
in a temporarily unstable state. The Advantage TPS can recover from the failed
transactions and return the tables and index files to a known state. After bringing
the file server back up, reload/restart the Advantage Database Server.
Loading/starting the Advantage Database Server automatically triggers failed
transaction recovery. Any transactions that were in the Build Phase when the
server crashed will be rolled back. Any transactions that were in the Commit
Phase will continue with the commit. Any transactions that were in the Rollback
Phase will continue with the rollback.
Always view the Advantage Database Server error log, ADS_ERR.ADT or
ADS_ERR.DBF, to determine if the Failed Transaction Recovery was successful.
If a Failed Transaction Recovery error is encountered, contact Advantage

Technical Support. It is recommended that periodic server backups be a part of

any disaster recovery plan.

DISADVANTAGES

The disadvatages is that there is a chance of double booking. Also,

transaction processing systems need to use direct acess files, serial acess
media such as magnetic tape cannot be used.

Errors corrected after processing the data

Time delay in gathering the data

Operational costs mat increase

discuss 3 major challenges that managers typically face in building

and/or using information system and elaborate the way to overcome
those challenges.

Introduction
As already stated, the value of information derives from the actions
management takes as a result of using the information. It follows that
information specialists need to know what types of task and functions
management have to perform so that they are able to produce relevant
therefore usable information.

The tasks and functions management have to perform vary greatly in detail
according to the type and size of organisation and the way responsibilities are
arranged. However, there are many common elements and managerial tasks
can conveniently be grouped into five areas: planning, decision making,
organising and coordinating, leadership and motivation, and control.
Obviously the emphasis given to each area varies from manager to
manager and is especially dependent upon the level of the manager in the
organisation.
In broad terms, three levels of management can be seen in all
organisations. Top or strategic management, middle or tactical management
and junior or operational management.
There are clear differences in information requirements between a manager
at the operational or transactional level such as, say, a transport supervisor
and a manager at the strategic or top level such as, for example, the
marketing director. At the highest level, structured, formal MIS may actually be
counterproductive for, at these levels, informal MIS and external influences
become increasingly important.
Another factor which affects the tasks managers have to perform, and
hence

their

information

requirements,

is

the

extent

of functional

authoritywithin the organisation. Functional authority is that which is exercised

by specialist managers and staff throughout the various departments and
units of the organisation. Possibly the most common example of this is the
Personnel

or

Human

Resources

department

which

has

functional

responsibility for many personnel and industrial relation activities throughout

the whole organisation.

Whilst each of the five functional areas, which in total constitute the task of
management, needs relevant information, three particular areas planning,
decision making and control.

Challenges Of TPS
Taking into account the high workload of required transactions per second (TPS)
problems to TP systems can arise and be addressed in the areas of the TPF, and
the DDMS. The TPF is considered as a system to manage terminals and disk
and does not provide a database management system with high-power
transaction processing. The task to manage files and resources is thus in charge
of the application programmers or designers. Hence TPF of the TP system is not
able to manage the high volume of transactions and stands therefore for a
performance constraint to transaction processing

The DDMS on first sight seems to be a practical instrument to handle the

required transaction processing power. However, it creates problems regarding
its huge size, its communication overheads, its reliability, and the possible
expanding of its organization. It is very difficult to manage and operate the
DDMSs large number of terminals and disks, which take up a lot of floor space
and likely can fail anytime. This means that the organizations have to spend
more time and money on the systems maintenance, thus affecting the system
availability. The distributed system can only operate appropriately when the
message communication between the nodes is efficient. This is expensive in
terms of money and time e.g. especially for wide area network messages, thus
reducing the performance of the system For the organizations it is difficult to
provide constantly high reliability in a DDMS i.e. that the system is not able to
recover immediately 100% from a failure. Organizations with large transaction
volume cannot tolerate long system downtime . The last difficulty towards the

DDMS is the expanding problem of the organizations. The enhancement and

thus the maintenance of the systems transaction processing performance on the
current level means to amplify floor space, hardware, terminals, communication
ports, and finally to add much more software Summarizing these paragraphs,
the major problem to transaction processing systems consists of I/O ctonstrains
addressed to the TPF and DDBMS of the organizations.

Solutions to Transaction Processing Systems

Regarding the mentioned problems to transaction processing systems of
organizations there is a need to find adequate solutions for them. According to
the system must be:
- Manageable: I.e. that the system must provide good development and
operations tools - Available: Means that the system at most can have an outage
of five minutes per year - Centralized/Distributed: The system should allow a
centralized or decentralized commitment without application change
- Granular: The system has to be composed of small units such as design,
control, performance, and failure
- Growable: Possible growth of the system has to guaranteed without problems Changeable: Changes of devices should not disrupt service of the system Cheap: The cost/TPS must be competitive

Hence to enhance the TPF the organizations should improve its the power an
capability including a data management system (to have transaction logging and
media recovery), a network management system, a transaction management
system, and so on . TPF can afterwards be used as a basis for a high-volume
transaction processor front-end using Information Management System (IMS) as
the back-end system . Furthermore the organizations should implement a
message-based architecture to the TPF, which can be the basis for distribution .
The pros are that this solution would at least fulfill the requirement of distribution,
granularity, and cheapness. Cons are the uncertainty about the manageability,
the availability, and the changeability. However, this possibility of improving the
TP architecture will support to manage and process a high volume of
transactions.

AFFECT OF MANAGEMENT INFORMATION SYSTEM IN AN ORGANISATION

Over the last few years, the information systems have greatly changed the
ORGANISATIONAL ECONOMICS AND INCREASED THE POSSIBILITY OF
ORGANIZING WORK.

ECONOMIC IMPACT

IT changes both the relative costs of capital and the costs of information.

Information systems technology is a factor of production, like capital and

labor.

Transaction cost theory: Firms seek to economize on the cost of

participating in markets (transaction costs).

IT lowers market transaction costs for firm, making it worthwhile for firms
to transact with other firms rather than grow the number of employees.

Agency theory: Firm is nexus of contracts among self-interested parties

requiring supervision.

Firms experience agency costs (the cost of managing and supervising).

IT can reduce agency costs, making it possible for firms to grow without
adding to the costs of supervising, and without adding employees.

ORGANISATIONAL AND BEHAVIOR IMPACT

IT FLATTENS THE ORGANISATION

Facilitates flattening of hierarchies

Broadens the distribution of timely information

Increases the speed of decision making

Empowers lower-level employees to make decisions without supervision

and increase management efficiency

Management span of control (the number of employees supervised by

each manager) will also grow

POSTINDUSTRIAL ORGANIZATIONS

Authority increasingly relies on knowledge and competence.

Information technology encourages task force-networked organizations.
Virtual firms

Use networks to link people, assets, and ideas

Can ally with suppliers, customers to create and distribute new products
and services.

Not limited to traditional organizational boundaries or physical locations.

INCREASING FLEXIBILITY OF ORGANIZATIONS

Information systems give both large and small organizations additional

flexibility to overcome the limitations posed by their size.

Small organizations use information systems to acquire some of the

muscle and reach of larger organizations.

Large organizations use information technology to achieve some of the

agility and responsiveness of small organizations.

Customization and personalization: IT makes it possible to tailor products

and services to individuals.

UNDERSTANDING ORGANIZATIONAL RESISTANCE TO CHANGE

Information systems become bound up in organizational politics because

they influence access to a key resource.

Information systems potentially change an organizations structure,

culture, politics, and work.

Most common reason for failure of large projects is due to organizational

and political resistance to change.