Data Data is any kind of fact or set of facts in raw or unorganized form.

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1 The difference between data and information Data Data is any kind of fact or set of facts in raw or unorganized form. Eg:- number of students who attend the class. Information Information is data that has been processed in to meaningful and useful form to the person who receives it. Eg: - profitability of the class Uses of Information in a Business - Planning Proper planning needs variety of information such as available resources in the organization, market information, customer information etc. - Controlling Information is required to determine whether the organization is moving as planned. If the organization does not achieve what is expected, corrective actions are taken based on the information. - Decision Making Effective decisions are based on good information. There are variety of characteristics such as accuracy, timeliness, relevance etc of good information. - Measuring Performance Performance measurement of organisations as well as its employees is very vital. Variety of information is used as the main way of measuring performance. - Improving specific areas Timely and accurate information help decision makers to help improve specific areas. Qualities of good information - Accurate Information should be free from false facts - Relevant Information provided should match the information need of users. - Up to date Information should be based on facts which are current. - Timely The users should receive information on time - Simple Information should be presented to the user in a manner which is easily understood - Economical Cost of generating the information should be within the accepted norms. - Reliable Information should come from sources which are verifiable. Sources of data and information Internal Information This is generated within the organization. The information is intended for employees in the organization, but is not restricted to them. The main advantage is that it is easily accessible by employees and access is restricted to internal employees. The main disadvantage is that information may be out of date and its limited in supply. External information When information is obtained from outside the business, it is identified as external information. An organization needs to be aware about the changes in the environment regarding competitors, customers, markets, legal aspects. Service sector organizations cannot compete without external information.

2 System A system can be defined as a set of interrelated components working together to achieve a common goal. Information System A set of interrelated components that collect process, store, and distribute information to support decision making and control in an organization. Components of Information Systems - Hardware - Software - Database - Telecommunication Networks - Procedures - People Information Management Information Management is the collection and management of information from one or more sources and the distribution of that information to one or more stakeholders. Information includes both electronic and physical information. Focus is on the ability to of the organization to capture, manage, preserve, store and deliver the right information to the right people at the right time. The entire organizational employees should be held responsible for information management. Information Technology Set of tools, processes, methodology and associated equipment employed to collect, process and present information. Eg:- Telecommunication, Storage and retrieval, multimedia, system analysis and design, system controls and coding/programming. Evolution of Information Systems Time Period Conception of IS Information System Purpose Transaction processing, record keeping, traditional accounting applications Management reports of predefined information to decision making Interactive and ad-hoc support to managerial decision making Electronic Data Processing Systems Management Information Systems Decision Support System (Customised and specialized reports) Speed accounting and paper processing Speed up general reporting requirements Improved decision making 1980s - today Strategic resource for competitive advantage Strategic Information System Promote survival and the prosperity of the organisation

3 Issues in Legacy system Definition - A legacy system, in the context of computing, refers to outdated computer systems, programming languages or application software that are used instead of available upgraded versions. - Maintenance and staffing costs are high and growing. - Changing compliance and regulatory concerns - Limited functionality limits innovation and growth. - Lack of integration between modules/systems - Making changes to the system is difficult due to rigid architecture - Management reports may not support decision making - Lack of security controls - Outdated technology Management Levels in an organisation Strategic Tactical Operational Operational Level- directly involved in the production of goods and services. They are usually the first level of management accomplishing day-to-day goals. Supervisors, line managers, sectional chief and office managers are operational level employees. Tactical Level - Tactical level (middle level) managers are responsible for business units and major departments. Divisional heads and Quality Control Managers are middle level managers. Tactical level plays a critical role in facilitating change and enabling organisations to respond to changes quickly. Traditional organisations have flattened organisational charts to expedite information flowfrom top to bottom and facilitate quick decisions. Strategic Level - Strategic level is the top of the hierarchy and is responsible for the organisation. CEO, Managing Director, Chairperson, Executive Directors are responsible for setting organisational goals, defining strategies, monitoring and interpreting external environment and making decisions that affect the organisation. Their focus is on long term perspective.

4 Different kinds of Information Systems Transaction Processing Systems (TPS) TPS serve the operational level of the organization and they support the basic business systems. A TPS processes and records the daily routine transactions necessary to conduct business. Eg Sales Order Entry Systems, Hotel Reservation Systems, Payroll Systems, Employee Record keeping system etc. Management Information System (MIS) MIS is used to identify a specific category of information systems that serve the management-level of an organization. It provides managers with reports and often online access to the organisation s current performance and historical records. MIS has an internal orientation and serves the management functions of planning, controlling, and decision making at the management level. MIS provides summarized reports and obtains inputs from the TPS. MIS are usually less complex and have little analytical capability. Decision Support System (DSS) DSS also supports the middle level managers but the purpose is fairly different from MIS. DSS helps managers make decisions that are unique, rapidly changing, and not easily specified in advance. DSS use both internal (from TPS and MIS) and external(competitor prices, stock prices) information. DSS have more analytical power and analytical than MIS. Executive Support Systems (ESS) ESS serves the top level of the organization. ESS too utilizes both internal (from MIS and DSS) and external information. ESS employs advanced graphics (easy to use graphs and communication capabilities) software so that information can be displayed in a simpler format to the senior managers to make quick decisions. The information from various sources are usually delivered through a portal which uses a web interface. ESS are usually very analytical. Functional View of Information Systems Manufacturing Information Systems The Manufacturing function is responsible for producing the firm's goods and services. Manufacturing and production systems support a variety of activities related to manufacturing function. They involve dealing with the planning, development and maintenance of production facilities; the establishment of production goals, the acquisition, storage and availability of production materials; and scheduling of equipment, facilities, materials and labour required to manufacture finished products. Strategic-level manufacturing systems deal with the firm's long term manufacturing goals. At the management level, manufacturing and production systems analyse and monitor production cost and resources. Operational manufacturing and production systems deal with the status of production tasks.

5 Sales and Marketing Information Systems The Sales and marketing function is responsible for selling the organisation's products or services. Marketing is concerned with identifying the customers for the firm's products or services, determining customer needs, planning and developing products or services and advertising them. Sales is concerned with contacting customers, selling the products and services, taking orders and following up on sales. At the strategic level, sales and marketing systems monitor trends affecting new products and sales opportunities, support planning for new products and services, and monitor the performance of the competitors. At the management level, sales and marketing systems support market research, advertising and promotional campaigns, analyse the performance of the sales staff and pricing decisions. At the operational level, sales and marketing systems assist in locating and contacting prospective customers, tracking sales, processing orders, and providing customer service support. Human Resource Management (HRM) Information Systems The HR function is responsible for the hiring, developing, and maintaining the firm's workforce. HRM information systems support number of HR related activities such as hiring potential employees, maintaining records of existing staff and creating programs to develop employees' talents and skills. Strategic-level HRM information systems identify the manpower requirements for meeting the firm's long term business plans. At the management level, HRM information systems help managers monitor and analyse the recruitment, allocation and compensation of employees. At the operational level, HRM information systems track the recruitments and placement of the firm's employees. Finance and Accounting Systems The finance function is responsible for managing variety of financial assets of an organisation such as cash, stocks, bonds and other investments. The accounting function is responsible for maintaining and managing the firm's financial records such as receipts, disbursements, depreciation and payroll. Strategic level systems for the finance and accounting function establish long-term investment goals for the firm and provide long-range forecasts of the firm's financial performance. At the management level, information systems help managers oversee and control the firm's financial resources. Operational level systems in finance and accounting track the flow of funds in the firm through transactions.