This all started back in the day. Someone would need a system made specifically for them to handle one problem. Soon enough that it was discovered that different problems needed similar solutions, but not always in the same manner of getting them. This is where defining of the information systems began and why it is still needed. When the company in question decides that they need to upgrade, they have to go through a process in order to find the right applications and hardware to handle their data. Classification comes to play here, so that categorizing information can be completed correctly. This will help to make the data one unit instead of many.
How Do You Identify Different Types of Systems?
There is no simple answer to the question. Every company builds an information system (IS) that is tailored to their specific needs. There are many different types of IS that are used in some manner or another. Classifying IS relies on how tasks are performed and responsibilities are divided in the agency. This becomes a pyramid model as most companies are hierarchical, so classes of IS are categorized following the hierarchy going down.
To compare different information systems:
- Transaction Processing Systems (TPS)– These are operational level systems. They are used by shop floor workers and front line staff. Data is gained here through tracking of low-level activities and basic transactions. They function as simple data processing systems only. This is the system that produces information for other systems to use. They are used internally and externally, are used by operational personnel and supervisors and are focused on efficiency. Examples: Payroll, Order processing, Reservations, Payments and Funds Transfers.
- Management Information Systems (MIS) – Management level used by middle managers. This system ensures smooth running of the company for short to medium terms. Information is given out highly structured and helps managers to evaluate the company’s performance through comparison of outputs. MIS is built on data given by TPS. They are based on internal information flow, support structured decisions, but are inflexible with not much analytical ability. Examples: Sales Management, Inventory control, Budgeting, Management Reporting, and Personnel.
- Decision Support Systems (DSS) – Knowledge based system used by senior managers. They analyze existing structured information, allowing managers to estimate any potential effects on decisions they are thinking of implementing. These systems are interactive and are used to solve problems. They can access databases, offer analytical tools, allow simulations to be completed, and can support exchanges of information in the company. This system can alter and build solutions provided by MIS and TPS, that can create insights plus new information to go off on. DSS helps to support badly or semi-structured decisions already being built, and have analytical and modeling capacities. Examples: Group Decision Support Systems (GDSS), Computer Supported Co-operative work (CSCW), Logistics, and Financial Planning.
- Executive Information Systems (EIS) – Strategic level used by executives and senior managers. These systems analyze environments that the company works in, find long-term trends, and plan courses of action. The information gathered is gathered from internal and external sources, and is weakly structured. These systems are designed to be able to be used directly by the executives and are user friendly with the ability to be customized to whomever is using it. EIS gathers and presents data from the MIS or TPS so senior management and executives can see what is going on a make decisions based off what they see. The people who use this want ease of use and being able to predict what will happen to the company in the future. It has to be effective, flexible, and support unstructured decisions. Examples: There are none. These systems are tailored to individual wants of the user, in other words are custom made. There are off the shelf packages that can be customized too.
The Importance of Planning
There is no easy way to explain why there are so many different types of information systems. Every company out there is not the same, or runs their agency in the same manner as others. This is why modifications are made to the systems in order for them to work specifically with what said company uses and the data they keep. Also every level of the agency uses different systems. Not everyone has to have a need to know of everything going on. It is better to keep it at the level that the systems are going to be used at the most. This is why planning for upgrades is so important. If the wrong system is used, or the wrong programs…