An information system is made up of hardware/machinery, software, users, data, and the processes needed by the users to produce useable information (Gaines et al 3). It also includes procedures used to store and retrieve information. Information systems can be classified into management information systems, transaction processing systems, office information systems, expert information systems, and decision support information systems.
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Usually, organisations combine two or more information systems to meet their needs. Combination can significantly improve the performance of an organisation. This paper will identify and discuss information systems that exist in an organisation I am currently dealing with.
The organisation uses an integrated information system. Major components of the system are management information system (MIS) and transaction processing system (TPS). Office information system also plays a role in the integrated information system. However, the transaction processing system is more important to the organisation.
The system helps the organisation to run smoothly. The various components of the system play different roles. However, they all contribute to desirable effects like better customer satisfaction, improved efficiency, and cost effectiveness. The transaction processing system helps the organisation to document all the transactions in real time.
They particularly aid the organisation in the generation of invoices, inventory records, receipts, and order requests. All transactions and their specific details are captured by the system. The information generated is used both at the time of generation and later on during decision making.
The management information system component enables management to monitor organizational activities and put the requisite input at the right time. Information that is generated by the system can be accessed by other members of staff who do not have to be physically present at the point of data generation. This improves the flow of information through the organisation. It also safeguards against introduction of errors by subsequent data handlers.
The information system has enabled the organisation to solve problems like inappropriate use of time, increased expenditure, and customer dissatisfaction. Time-saving activities are important to both the organisation and the customers. Customers often give negative reviews if they are not attended to on time.
Information systems are used by organisations to support strategies like low-cost leadership and innovation. Management information system is an important tool that can be used to shift the cost of doing business (O’Brien & Marakas 56). It enables organisations to lower the cost of doing business by reducing the number of business processes.
The system lowers supplier costs by eliminating the need to travel frequently. Lower customer costs may also be achieved through adoption of information systems. Lower costs accompanied by desired quality of goods or services enable an organisation to win new customers and retain old ones. Reduced supplier and customer costs may benefit the organisation in the long run. Generally, information systems reduce both direct and indirect costs of an organisation.
Organisations can use information systems to create and improve relations with customers and suppliers (Jessup & Valacich 415). These strategic alliances may help an organisation to increase revenue in the long run. This can be done through development of applications that make customer experiences enjoyable.
For instance, applications that create customer forums may be developed to ease interaction between customers and the organisation’s employees. Due to their numerous benefits, information systems have become integral parts of modern day businesses.
Gaines et al 2011, Information systems as a strategic partner in organizational performance. PDF file. 30th October 2013. <http://www.aabri.com/manuscripts/11997.pdf>.
Jessup, Leonard & Joseph Valacich. Information Systems Today (3rd ed.), NY: Pearson Publishing, 2008. Print.
O’Brien, James & George Marakas. Management Information Systems (10th ed.), New York: McGraw-Hill, 2011. Print.