Managing Information

Systems
Information Systems in Organisations
Kangethe Alex
DIS 511

Objectives
To understand the role of IS within
organisations
To understand the diversity of types of IS
within a business / organisation
To understand relationships between IS and
business functions

Topics
Types of Information System in
Organisations:
By organisational level
By function within organisational level
Examples in functional areas

IS at the Organisational Level

KIND OF SYSTEM
STRATEGIC LEVEL

MANAGEMENT LEVEL

KNOWLEDGE LEVEL

OPERATIONAL
LEVEL

GROUPS SERVED
SENIOR MANAGERS

MIDDLE MANAGERS

KNOWLEDGE &
DATA WORKERS
OPERATIONAL
MANAGERS

SALES &
MARKETING

MANUFACTURING FINANCE ACCOUNTING HUMAN

RESOURCES

IS at the Organisational Level

Operational-level
Elementary activities and routine transactions
Data current and accurate

Knowledge-level
Support knowledge and data workers
Integrate new knowledge into the business
Office automation

IS at the Organisational Level

Management-level
Periodic monitoring, control, decision-making
and administration
Is the business working well?

Strategic-level
Long-term (e.g. 5 year) planning and strategy
Internal and external information

Examples
What examples can you think of at the
different organisational levels?

Types of IS

Transaction Processing Systems (TPS)

Knowledge Work Systems (KWS)
Office Automation Systems (OAS)
Management Information Systems (MIS)
Decision-support Systems (DSS)
Executive Support Systems (ESS)

Transaction Processing Systems

Systems that perform and record daily routine
transactions necessary for business
Operational-level Systems
Order
tracking

Machine control

Securities trading Payroll

Compensati
on

Order
processing

Plant scheduling

Cash
management

Accounts
payable

Training and
development

Accounts
receivable

Employee
records

Material
movement and
control
Sales and
Marketing

Manufacturing

Finance

Accountin
g

Human
Resources9

Knowledge Work Systems

Systems that aid the creation and integration of new
knowledge into an organisation
Knowledge-level Systems
Engineering workstations Graphics workstations

Managerial workstations

10

Office Automation Systems

Systems that are designed to increase the
productivity of data workers
Knowledge-level Systems
Word processing

Document imaging

E-mail / electronic
calendars

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Management Information
Systems

Systems that serve planning, control and decisionmaking through routine summary and reports
Management-level Systems
Sales
Inventory control
management
Sales and
Marketing

Manufacturing

Annual budgeting Capital

investment
Finance

Accountin
g

Relocation
analysis
Human
Resources

12

Decision-support Systems
Systems that combine data, models and analysis
tools for non-routine decision-making
Management-level Systems
Sales region
analysis
Sales and
Marketing

Production
scheduling
Manufacturing

Cost analysis

Pricing /
profitability
analysis

Contract
cost analysis

Finance

Accountin
g

Human
Resources

13

Executive Support Systems

Systems that support non-routine decision-making
through advanced graphics and communications
Strategic-level Systems
5-year sales
trend
forecasting

5-year operating
plan

Sales and
Marketing

Manufacturing

5-year budget
forecasting
Finance

Profit
planning
Accountin
g

Personnel
planning
Human
Resources

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Interrelationships
TPS major producer of
data
External data also
required for MIS, DSS
and ESS
Typical loose coupling of
systems
Digital firms have tighter
integration

ESS

MIS

KWS

DSS

TPS

OAS

15

Functional Examples
Examples of IS by function:
Sales and marketing
Manufacturing and production
Finance and accounting
Human resources

16

Sales and Marketing

System

Description

Organisational
Level

Order processing

Enter, process and

track orders

Operational

Market analysis

Identify customers and

markets

Knowledge

Pricing analysis

Determine prices

Management

Sales trends

Prepare 5 year
forecasts

Strategic

17

Manufacturing and Production

System

Description

Organisational
Level

Machine control

Control actions of
equipment

Operational

Computer-aided
design (CAD)

Design new products Knowledge

Production planning

Decide number and Management

schedule of products

Facilities location

Decide where to
locate facilities

Strategic

18

Finance and Accounting

System

Description

Organisational
Level

Accounts receivable

Track money owed

to firm

Operational

Portfolio analysis

Design firms
investments

Knowledge

Budgeting

Prepare short-term
budgets

Management

Profit planning

Plan long-term
profits

Strategic

19

Human Resources
System

Description

Organisational
Level

Training and
development

Track training, skills

and appraisals

Operational

Career paths

Design employee
career paths

Knowledge

Compensation
analysis

Monitor wages,
salaries and benefits

Management

Human resources
planning

Plan long-term
workforce needs

Strategic

20

Summary
Looked at the role of IS within organisations
At organisational levels

Looked at the diversity of types of IS within a

business / organisation
Six different functional types of IS

Looked at relationships between IS and business

functions
Examples by functional area

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