What is an information system

22 Oct

While jamesdaly1990 and  ah88rockybay have mentioned the terms Transaction Processing Systems, Management Information Systems, Decision Support Systems and Expert Systems, I would like to go into more detail about each, and give concrete examples of each system in use. It is worth mentioning that all theses systems support each other and draw data from each other.

Transaction processing systems are basic business systems that serve the organization’s operational levels . They are used mostly by operations personnel, or put simply, lower level users. A simple example of one of these systems is a till. Using Tesco as an example, their transaction processing system allows the clerk to scan products. The price is then displayed, and another item can be scanned, the system then will calculate the total bill for the shopping, will allow for card purchasing and verify card details, and tells the clerk the change to be given. The customers shopping is then stored. This information will then be processed by other information systems.

Management information sytems are used by middle management level. Management Information System (MIS) is basically concerned with the process of collecting, processing, storing and transmitting relevant information to support the management operations in any organizations. (Ajayi and Fadekemi). Using the example of Tesco again data collected by the TPS would help managers decide what stock to order more of and what to order less of as they would see figures on stock sold. Managers would also use the total gained from sales to check how much money is supposed to be in the till’s. They can also check how many customers a particular cashier is serving and if they are particularly slow.

DSS serve management level with data analysis for making decisions. They use data to provide Special reports, decision analyses and  responses to queries by management to the system. An exampe of DSS in use is in Maytag International, a division of the whirlpool company. They use the system DI driver and senior database analyst Doug Wendling describes its use.

“DI-Diver is used in offices around the world to track sales and analyze profitability for refrigeration, laundry, floor care, cooking and dishwasher product categories. DI-Diver reports include sales dollars, unit totals, revenue, cost, warranty, and gross margin information for 1,700 SKU’s and 1,000 customers. DI-Diver allows Maytag International to communicate more effectively with customers and each other, find and capitalize on the most profitable product mixes, and quickly identify and eliminate the least profitable SKU’s. In addition, if a manager questions data within the DI-Diver reporting package, he or she can quickly zero in on the data to determine the root of the question”


Expert systems provide computing support for expert type decisions, for people at every level. According to Peter Jackson in his paper an introduction to information systems (1998) it is “a computer system that emulates the decision-making ability of a human expert” An example of an expert system is in the banking sector, where a clerk can type a persons information and credit history into the system which will in turn decide to give a loan to the applicant or not. This saves the cost of labor of having to consult an industry expert each time a bank receives loan application.(http://www.cs.nott.ac.uk/~rxq/files/8FAIESa.pdf)


5 Responses to “What is an information system”

  1. seamuscorry1990 October 26, 2012 at 11:30 am #

    Whilst many of ye are explaining what is an information system I believe one has to mention the endless advantages associated with the implementation of effective information systems. There is no hiding of the fact that information systems have not only brought the world closer together, but it has allowed the world’s economy to become a single symbiotic system. Geographic boundaries have been completely dismantled. Information systems have also enabled countries such as America and China whom are separated by both land masses and language barriers to share information, and do business with each other. Information systems have made communication economical and more efficient. We can now communicate with anyone around the globe by simply text messaging them or sending them an email for an almost immediate response. The internet has also opened up face to face direct communication from one corner of the globe to the other thanks to the help of video conferencing and Skype. With the creation of new IT and IS jobs globally has led to the creation of endless job opportunities. Programmers, Web designers, Software developers are some but to name a few. In our current climate every IT company requires IT graduates and it is one area where employment is easy to come by. As ah88rockybay highlights that “Apple currently have 1000 staff members, last year for the Christmas period they hired an extra 50 employees. They expect an increase in sales of 20% from last year and predict they will need to increase their numbers to 1250”. Information systems help with companies gaining competitive advantage. benefits of an information system follow when the user can quickly access, understand and respond correctly to that information.

  2. 04ac October 26, 2012 at 11:52 am #

    Ag Blogáil, I found your blog really useful as not only did you provide definitions of Transaction Processing Systems, Management Information Systems, Decision Support Systems and Expert Systems, you also took organisations and applied each concept to the organisation and how it fits into there day to day running. It helped me to get a better understanding of each concept.

    • agblogail October 28, 2012 at 12:11 pm #

      Thank you for your feedback, Much appreciated.

  3. thestrategicblogger November 3, 2012 at 5:03 pm #

    Great job agBlogail you really made it clear to me how IS systems can be a source of competitive advantage. Just wondering do you think I.S. is applicable to all sectors i.e. the fast food industry?

  4. agblogail November 4, 2012 at 4:15 pm #

    Yes i would think IS is already applied to all sectors, especially in lower levels such as transaction processing systems. A large company like Mcdonalds would have large portions of thier supply chain system automated, and their TPS would allow for better stock ordering and control. At a local fast food level as im sure you are alluding to, I feel that data analytics could be used to see patterns in comsumer spending. Certain deals or offers could be made at certain times when particular products are not being sold. Firms could also use this info to position foods on the menu strategically. All this can offer better value to your customers, which is the core function of IS. Thank you for your comment hope this answers your question.

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