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Information system in business organisation

Paper Type: Free Essay Subject: Information Systems
Wordcount: 4603 words Published: 1st Jan 2015

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Requirement No:1.1

Think of a business organization (e.g Retailers,contractors,banks)or public service organization(e.g NHS,Home office,policedepartment,post office etc)

You have had some involvement with or that you have some knowledge of it.it can be a small organization like shop or medium sized college or a very large organization such as NHS.explain and draw a diagram to show.

I have chosen a pharmaceutical company  as a business organization.for the purpose of completing this assignment I have to understand different functional areas of the chosen organization. i also have to analyze different  information needs  of this company.

The different functional areas  of the pharmaceutical company are listed below:


Production will refer manufacturing the goods using raw materials.assembling the product after finishing.


Sales are a vital function in any business organization.Meeting the aims and objectives are the responsibility of the sales team.


indentifying the customer’s demand and meeting their needs is what marketing is concerned.They research and what product the public is interested in, what price they are willing to pay inform and promote the products and how the organisation should distribute.


The main duty of the purchasing department is to identify the best suppliers and reach to an agreement which will be more beneficiary for the organization.

human resource:

In an organization H.R department performs  staff recruitment, staff training and  ensuring all health and safety rules are properly  followed and maintained etc.


a lot of entrepreneurs considers it as the most important department in any business. This is because all companies must have a regular money income to survive. Finance will handle some of the company’s most important decision.



Requirement No:1.2

Each of the functional area of the chosen organization needs some kind of informations.the following list will show the information needs of each functional area listed in 1.1:

Information needed in sales department:

The sales department will require information of up to date market situation of the current product in order to sale their product in the market. it maintains the code of conduct for the business institutions .they will prepare the business plan to run the business in a long term process.

Information needed in the production department:

Production department will need the information about organization’s existing raw materials or stock. labour facilities .this department will keep the information about the storage. inorder to progress and make profit in the business it will also keep monitoring the machineries of the industry to ensure that the manufacturing process does not get hampered or delayed  due to machinery faults.

Information needed for the marketing department:

Marketing department will require informations about the current market trend of the specific product.they will use this information to analyze and decide how can they advertise their products so that it can reach to its customers.

This might include the information regarding the current media facilities.they will need the information of which media will be most helpful and beneficiary for them to advertise their products.they may consider advertising in the television and radio,loval newspapers,mailing yo the existing customers,distributing leaflets .

Information needed in finance department:

This department will require the information about  the flow of funds in the organization through product invoices, payment receipts.they will use this information to make budget for the purchasing of the raw materials to help  run the production department.finance department will also need the information of the regular income and spendings inorder to make forecast of the next financial year.this informations will be of to the use of the respective managers to reorganize their financial plans.

Information needed for the human resource department:

This  department will need complete information about their employees details such as name,date of birth,national insurance,tax records,address,previous service records etc.they will initiate programs to develop employee skills.this department requires informations to help identifying the employee requirements,increament of the salaries to boost up the employees.they also need informations of staff performance to ensure every staff is well trained and compitable to the allocated task.

Purchasing department:

This department needs information about the existing stock of the organization inorder to buy new raw materials.they will also need information about their suupliers such as previous business records,duration oftheir buiness,reliability,cost and the quality.installation services available or not etc.

Customer service department:

This department has special task to deal with the customers and pass through the outcomes to the proper authorities.customer service department will need the information regarding customer queries,complaints or customer feedbacks.

Requirement no:1.3

The organization that I have chosen has different functional areas like sales and marketing,production,finance,purchasing,human resources and customer services.this department requires specific information system to acquire exact data and process them in a proper way.

The sales and marketing department requires  an information system which is known as the sales and marketing information systems.

The manufacturing and production department needs Manufacturing and production information systems.

Finance and account department requires a information system known as Finance and Accounting information system.

Human resource department requires Human resource information systems.

Requirement 1.5

Paul needs to install a computer networkingsystem for the chemical processing plant where he works.he asks the IT department to write a detailed specification of what they need.he then contacted severalk suppliers ans asks them to come and look at the plant and quote for supplying the system the specification described.he takes the quotation to tmanagement and they decided which one to use on the basis of :

-exactly what type of equipment will be supplied

-the price

How quickly it can be installed

The terms of maintenance contract offered

The type of training and support offered.

Paul  negotiate terms with the supplier they have chosen and agrees the delivery date.he asks fpr the IT department to sign a form when they accept tahe network has been delivered and installed properly and passes thus with invoice to the accounts department.

Now  the purchasing department will need to keep some information about the suppliers to help fulfill its functions.the purchasing department will keep the information about the type of equipments which will be supplied by the suppliers,information about the terms and conditions of the agreement,the detailed contacting address of the suppliers to check their authenticity,information about their business records,information about their present clients and its condition.

Requirement no:2.1

Information system:

An information system can be defined as “a set of inter-related components working together to collect, retrieve, process, store and distribute the information in order to facilitate the planning, control, coordination, analysis and decision making in companies and other organizations.”.

The administration of information technology emphasizes the quality and value for business and security of information system in an organization.

The IS help managers to make decisions, analyze and visualize complex issues and solve other problems.

it uses a cycle of three basic activities: input, processing and output. The IS has three basic functions in the organization of a company, which has the capacity to transform information into knowledge.

There are four major types of information systems.they are,

  • transaction processing system(tps)
  • management information system(mis)
  • decision support system(dss)
  • executive support system(ess)

Transaction processing system:

Transaction processing system are the basic business system that serve the operational level of the organization.it is a computerized system that performs and records the daily routine transactions whish is necessary to run the business.tps are used to make entry for sales order,payroll orocessing,hotel reservation,keeping employee record etc.

It record and track an organization’s transactions, such as sales transactions or inventory items, from the moment each is first created until it leaves the system. This helps managers at the day-to-day operational level keep track of daily transactions as well as make decisions on when to place orders, make shipments, and so on.

Management information system:

Management information system designates a a specific category of information systems serving management level of the organization.it provides managers with periodic, often summarized, reports that help them assess performance and make appropriate decisions based on that information. An MIS provides managers with information and support for effective  decision making and provides feedback on daily operation.outputs or reports are usually generated through accumulation of transaction prosseing data.MIS is an integrated collection of sub systems which are typically organized along functional lines within an organization.

Decision support system:

These systems are designed to help mid-level and senior managers to make decisions where  every relevant parameter is not recognized. DSS help managers to make decision that are uniqueand rapidly changing and not really specified in advance.These decisions are characteristic of the types of decisions made at the higher levels of management..An example is the decision on whether or not to open a branch in a foreign country. Some of the parameters that go into the making of these decisions are known. The value of a decision support system (DSS) is in its ability to permit “what-if” analyses . DSS helps the user to model and analyze different scenarios in order to arrive at a final, reasonable decision, based on the analysis. An example of the DSS is the voyage estimating system.9t calculates financial  and technical voyage details.

Executive support system:

An expert system is built by modeling into the computer the thought processes and decision-making heuristics of a recognized expert in a particular field. Executive support systems are used by the senior managers or the executives in an organizations to help them making decisions .ESS serve the strategic level of the organization. ESS are designed to incorporate data about external events.it  draws summarized information from internal MIS and DSS.it filters , track critical data and  compress, displaying the data of greatest importance to senior managers .ESS employs the most advanced graphical software and  presents graphs and data from many different sources. often the information is delivered  to senior executives through a portal,which uses a web interface to present integrated personalized business content from a variety of sources .

Requirement no:2.2

Identify and examine current trends in using different application to solve business problems(e.g;transaction processing ,payroll,record keeping etc)

Transaction Processing: it is a business problem which involves the processing of transactions within an organisation. It requires the specific implementation of the Transaction processing system. managing data transaction  in database system and monitoring transaction is done by the transaction processing system The concept of a transaction, and a transaction manager (or a transaction processing service) simplifies construction of such enterprise level distributed applications while maintaining integrity of data in a unit of work. E.g. if an electronic payment is made, the amount must be either both withdrawn from one account and added to the other, or none at all. In case of a failure preventing transaction completion, the partially executed transaction must be ‘rolled back by the TPS. While this type of integrity must be provided also forbatch transaction processing ,it is particularly important for online processing: if e.g. an airline seat reservation system is accessed by multiple operators, after an empty seat inquiry, the seat reservation data must be locked until the reservation is made, otherwise another user may get the impression a seat is still free while it is actually being booked at the time. Without proper transaction monitoring, double bookings may occur.



A payroll TPS, which is a typical accounting transaction processing system found in most firms. A payroll system keeps track of the money paid to employees. The master file is composed of discrete pieces of information (such as a name, address, or employee number) called data elements. Data are keyed into the system, updating the data elements. The elements on the master file are combined in different ways to create reports of interest to management and government agencies and to sendpaychecksto employees. These TPS can generate other report combinations of existing data elements

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.The tasks offered by a payroll processing system includes social security and income tax filings, reporting, direct deposit options for employees, and of course, signed, sealed, and delivered paychecks. Many payroll service systems will be able to receive employee information and time records with a phone call to a customer service rep, via fax machines, or even through email.


Record keeping:

An electronic system in which records are collected, organized, and categorized to facilitate their preservation, retrieval, use, and disposition may be either (1) a distinct system designed specifically to provide recordkeeping functionality or (2) part of another system. A distinct electronic recordkeeping system will comprise an application program which provides recordkeeping functionality, data and metadata needed for management of the records controlled by the system, and any electronic records managed by the system. An electronic recordkeeping system may be part of another system, such as an application system or an electronic document management system, when the design of that system includes recordkeeping functionality.

Requirement 3.1

Airline reservation systems are used to track and maintain records of flight schedules, passenger reservations and seat assignments, aircraft loading, flight inventory, ticket purchases and fare tariffs. The modern airline reservation system also serves customer needs from beginning to end of each customer’s reserved flight, therefore laying out management tasks for each flight.


It seems that double booking will be a great problem in the airline reservation system.because travel agents across the world book and cancel reservation almost simultaneously.but because of a highly skilled ,fast and speedy and huge software system this problem doesnot occur.

Now a days airline companies do not run  only with their own database which is not connected to  other systems but the airline’s own air travel information  is stored and linked and with a network of a computer reservation system(CRS).this CRS is accessible by multiple airlines and travel agents.A computer reservation system is used for the reservation of a particular airline and interfaces with  a global distribution system(GDS) which supports travel agencies and other distribution channels in making reservation for most airlines in a single system. . The global distribution system (GDS) makes for an even larger web of airline information, not only merging the buying and selling of tickets for multiple airlines, but also making the systems accessible to consumers directly. GDS portals and gateways on the Web allow consumers to purchase tickets directly, select seats.

Airline Reservation Systems contain schedules, fare tariffs, passenger reservations and ticket records.  An airline’s direct distribution works within their own reservation system, as well as pushing out information to the GDS.  A second type of direct distribution channel are consumers who use the internet or mobile applications to make their own reservations.  Travel agencies and other indirect distribution channels access the same GDS as those accessed by the airlines’ reservation systems, and all messaging is transmitted by a standard messaging system that functions primarily on TTY messaging called SITA.  These airline reservation systems are business critical applications, and their functionality is quite complex and the operation on an in-house airline reservation system is relatively expensive.


Requirement no 3.3

An airline’s inventory contains all flights with their available seats. The inventory of an airline is generally divided into service classes (e.g. First, Business or Economy class) and up to 26 booking classes, for which different prices and booking conditions apply. Inventory data is imported and maintained through a Schedule Distribution System over standardized interfaces. One of the core functions of the inventory management is the inventory control. Inventory control steers how many seats are available in the different booking classes, by opening and closing individual booking classes for sale. In combination with the fares and booking conditions stored in the Fare Quote System the price for each sold seat is determined. In most cases inventory control has a real time interface to an airline’sYield managementsystem to support a permanent optimization of the offered booking classes in response to changes in demand or pricing strategies of a competitor.

Airline Reservation Systems contain schedules, fare tariffs, passenger reservations and ticket records.  An airline’s direct distribution works within their own reservation system, as well as pushing out information to the GDS.  A second type of direct distribution channel are consumers who use the internet or mobile applications to make their own reservations.  Travel agencies and other indirect distribution channels access the same GDS as those accessed by the airlines’ reservation systems, and all messaging is transmitted by a standard messaging system that functions primarily on TTY messaging called SITA. 


Requirement 3.4

Applicable alternative method for  airline reservation

Electronic ticketing and reservation system

The passenger makes the reservationand a unique reservation number is issued which is stored in the central computer of the airline reservation center. The passenger is then issued a plastic identification card  that will be used to access the computer for validation purposes. An automatic teller machine which locates at the airport,. the passenger can receive information about the specific flight, departure gate information, and a boarding pass, and to makereservationand access frequent flier information and messages, simply by the insertion of the I.D. card in a card a reader at the ATM. A mobile airline communications system at the departure gate includes a magnetic card reader that provides validation of thereservationat the departure, which allows the passenger to board the aircraft. It will require authorization and validation at each scheduled activity. Also, goods and services provided by theairlinemay be obtained using the I.D. card, including charging purchases against the passenger’s accumulated frequent flier miles.


Requirement no:4.1

List the information system evaluation measures that can be used in the evaluation of the system mentioned in the scenario of requirement 4.0.

In the above scenario it is clear that there are two information systems working together. one of them is management information  system (MIS) and the other one is expert system

Management Information System

Management Information System could be useful in managing informations regarding patient’s medical history.

  • Data Accuracy: data accuracy is a big issue inorder to provide effective treatment . MIS Uses   the appropriate  data,  such  as name , age,  address , information on past illness, and recurring symptom among other,.
  • Professionalism: The usefulness of this Information system will be evaluated on its effectiveness, expenses and maintenance.
  • Cost: This system will be highly evaluated on the ground of its service and cost effectiveness..

Expert System

  • Social Issue: An Expert System is gathering human idea and expertise into a combined ,highly reliable source of information
  • Confidence: this is a software  programmed  with set of ideas .for example MIS, is linked to it and  accessed by the Expert system in term of making diagnosis, in a format of if/then method.
  • Benefit: using expert system in patient diagnosis has a remarkable affect on the treatment of the patient. because the doctor can get some really useful information  in a critical time which could be life saving for the patient specifically at that time.
  • Professionalism: as it is a pure software programmed with a set of riules and regulations there is no way it can go beyond that.except for the personal  interacton ,working with an expert system is much  like working with a human being technically expert system is the highest form of a knowledge based system.
  • Legal Issues:
  • Accuracy:. Although the expert system is very accurate in making decisions but still  it cannot adapt to changing environments, unless knowledge base is changed.
  • Cost: The cost of the system will be justified by the present technology.
  • Reliability:it would be very difficult for some patients to accept a decision which has been taken by a artificially intelligent machine taking their knowledge into consideration.. 

Requirement no:4.2

Evaluate the effectiveness of both information systems mentioned in the above scenario, by employing different evaluation measure effectively.

Taking  into the consideration of the evaluation measures of both systems using these to make judgement on the effectiveness of their application.

The management information system only manages the information and helps its user to take any decision based on the available information it has.this is the reason MIS is reliable.

This system can hold the data for a long period of time. And it is reliable as it can be updated when it required.

.It is not likely to be expensive.so considering the expense it is cost effective as well.

More record can be updated, and can hold huge records one at a time.

The name of an expert system suggests how good it is when it comes to take any critical decision.

. It uses informations from MIS to retrieve detailed information.

Considering the professional aspect of an expert system, it will perform based on the available data and intelligence coded inside it.

When it comes to the point of accuracy and reliability an expert system is really accurate and reliable.human being can make some mistake but an expert system will never make any error because it is programmed in that way.it will always be available to work.

The effectiveness of Expert System may imperiled considering the Ethical issues around its acceptance whenconsidering human lives. It is designed and engineered to work on information inserted in it, as well the codes computed while making the software.. It is been created to work in place of humans under a limited expertise.

Requirement no:4.3

The tabular form  of documentation  for the evaluation  of the two systems mentioned in the  scenario.


Management Information System.

Expert System.

Accuracy and Reliability

accurate as information is being computed into it. Information can not be corrupted as it is built withhigh level security.

It works as it is programmed. It will remain reliable to the programmer, even though patients will find it unreliable.

Legal and Social Matters

Due to its indirect involvement with the judgement the legal issues could be overlooked as informations are only available only to the authorized user.

Depending purely on an expert system  while patient is in a situation of life and death could be turned down as questions could be raised on the machine dependency.

Professionalism and Ethical Issues

Professionalism is guranteed as the data already in the system can easily be updated.

If the user of the expert system is well trained then the professionalism will be well judged.but ethical issues will be a subject to think about when the patient will refuse a diagnosis due to a machine based judgement.

Cost Effectiveness

It is not likely to be expensive.so considering the expense it is cost effective.

An expert system will usually be very expensive as it undergoes lots of human expertise and coded with sprcially trained programmer.it could be considered as cost effective if it is truly reliable and depends on which sector it will be applied.


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