MIS Notes

Q) What is an Information System? Explain with necessary elements.

Answer:
An Information System (IS) is a system that helps in collecting, storing, processing, and
distributing information so that organizations can take better decisions, coordinate activities,
and control operations.

 It is not only about computers, but also about people and processes.

 Example: In a hospital, an IS keeps patient records, helps doctors see reports, and
prepares bills automatically.

Elements of Information System:

1. Hardware

o Hardware refers to the physical devices used in the system.

o It includes computers, laptops, servers, printers, scanners, and networking

devices.

o Without hardware, data cannot be stored or processed.

o Example: ATM machines in banks are part of IS hardware.

2. Software

o Software is the set of programs or applications that tell the hardware what to
do.

o It can be system software (like Windows, Linux) or application software (like

MS Excel, ERP systems).

o Software helps to process data into useful information.

o Example: Railway reservation software processes bookings and cancellations.

3. Data

o Data are raw facts and figures collected from day-to-day activities.

o On their own, data have no meaning, but when processed, they become
information.
 o Example: “100, 200, 300” are just numbers (data), but if we say “sales in three
days = 100, 200, 300,” it becomes information.

o Data is the core element of IS.

4. People

o People are the users who interact with the system.

o They can be managers, employees, IT staff, or customers.

o Without people, the system cannot function because they enter data, interpret
reports, and take decisions.

o Example: A manager checking sales reports or a student checking exam results

online.

5. Processes/Procedures

o Processes are the rules, methods, and steps for collecting, processing, and
using information.

o They ensure that data is entered correctly, stored safely, and used properly.

o Example: In a bank, there are fixed procedures for creating a new account,
approving loans, or updating balances.
Q) Explain the Types of Information Systems.

Answer:
Organizations use different kinds of Information Systems (IS) depending on their needs and
levels of management. The main types are:

1. Transaction Processing System (TPS)

 TPS is used at the operational level of an organization.

 Its main function is to record and process the routine, day-to-day transactions.

 These systems handle large volumes of data and must be very accurate and fast.

 TPS ensures that business operations run smoothly without interruption.

 Examples:

o ATM machines in banks (withdrawal/deposit).

o Supermarket billing system.

o Railway or airline reservation system.

2. Management Information System (MIS)

 MIS is used at the middle management level.

 It collects data from the TPS and provides summarized reports for managers.

 MIS helps managers in planning, controlling, and decision-making.

 It usually provides information in the form of regular reports such as daily, weekly, or
monthly summaries.

 Examples:

o Monthly sales reports for managers.

o Attendance reports of employees.

o Inventory management reports.

3. Decision Support System (DSS)

 DSS is used by middle and top-level managers for complex decision-making.

 It helps in solving semi-structured and unstructured problems where the solution

is not straightforward.

 DSS uses data from MIS, along with analytical models, simulations, and “what-if”
analysis.

 It is very useful when managers need to compare alternatives.

 Examples:

o Choosing the best location for opening a new branch.

o Analysing investment options for maximum profit.

o Forecasting sales using models.

4. Executive Support System (ESS) / Executive Information System (EIS)

 ESS is used by top-level executives.

 It provides highly summarized information about the overall performance of the

organization.

 It helps in long-term strategic planning and monitoring the external environment

(like competitors, government policies, market trends).

 Information is usually presented in dashboards, charts, or graphs for quick

understanding.

 Examples:

o Dashboard showing overall company performance.

o Graphical reports of global sales.

o Market trend analysis for top executives.

5. Knowledge Management System (KMS)

 KMS focuses on capturing, storing, and sharing the knowledge and experience of
employees in an organization.

 It encourages learning and innovation by making information easily available to all

staff.
  KMS improves productivity because employees can access the knowledge of others
instead of repeating work.

 Examples:

o Online training platforms for employees.

o Company knowledge base (FAQs, manuals).

o Research and development information sharing.

Q) Explain the Impact of Information Systems on Organizations and Society.

1. Impact on Organizations

Definition:
In organizations, an Information System (IS) is a setup of hardware, software, people, and
processes that helps in managing business data and supports decision-making.

Working:
IS in organizations works by collecting data from daily activities, processing it into useful
information, and then providing reports to managers and employees. This helps in planning,
controlling, and taking quick decisions. For example, when a customer buys a product in a
shop, the billing system records the sale, updates the inventory, and creates a sales report
automatically.

Examples & Use:

 In banks, IS is used for ATM services, online banking, and keeping customer records.

 In retail companies, IS is used for managing stock, customer orders, and delivery.

 In manufacturing companies, IS is used for supply chain management and quality

control.

Impact on Organizations :

1. Information Systems improve efficiency in organizations by automating routine work

like payroll, billing, and salary management. This saves time and reduces errors.

2. They also improve communication and coordination among departments.

Employees can share reports and information instantly through emails, shared
databases, and dashboards.

3. IS provides a competitive advantage because companies using advanced IS can

serve customers faster and better than others. Example: Amazon and Flipkart use IS to
track orders, manage warehouses, and provide one-day delivery.
2. Impact on Society

Definition:
In society, Information Systems provide people with access to information, services, and
communication tools that improve daily life and social activities.

Working:
IS works in society by connecting people through the internet, storing and sharing large
amounts of information, and offering online services such as e-learning, e-governance, and
digital payments. It makes life easier and faster.

Examples & Use :

 In education, IS is used for online classes, e-libraries, and digital exams.

 In healthcare, IS is used for storing patient data, telemedicine, and online

appointments.

 In daily life, IS is used for online shopping, mobile payments, and social media.

Impact on Societies :

1. IS has improved the quality of life by giving people access to online shopping,
banking, healthcare, and education from anywhere. For example, during the COVID-
19 pandemic, online learning platforms and work-from-home systems helped society
to continue functioning.

2. IS also improves communication and global connectivity. People can interact

through social media, video calls, and emails. This has made the world a "global
village." Governments also use IS for e-governance, smart cities, and online tax filing.

3. However, IS in society also has challenges like cybercrime, fake news, and digital
divide (where rural or poor people do not have access to technology). Still, the
benefits like convenience, connectivity, and better services outweigh the negatives.
Q. Advantages Achieved in Information Systems (IS)

Information Systems (IS) provide several advantages to organizations, individuals, and

society. These advantages can be seen in terms of efficiency, decision-making,
communication, and overall productivity.

1. Improved Efficiency and Productivity

IS automates routine and repetitive tasks such as payroll processing, billing, attendance, and
inventory management. This reduces human errors, saves time, and increases overall
productivity in organizations.

2. Better Decision-Making

With tools like Decision Support Systems (DSS) and Management Information Systems
(MIS), managers get real-time, accurate data and analytical reports. This helps them make
faster and more informed decisions.

3. Enhanced Communication and Collaboration

IS allows instant communication through emails, video conferencing, and messaging apps.
Within organizations, teams can collaborate easily even if they are located in different parts
of the world.

4. Cost Reduction

By reducing manual work, paperwork, and physical storage, IS lowers operating costs. Cloud
storage and digital processes are cheaper than traditional methods.

5. Competitive Advantage

Organizations using IS can serve customers better and faster (example: Amazon using IS for
tracking, recommendation, and delivery). This gives them an edge over competitors.

6. Better Customer Service

IS improves customer support through chatbots, helplines, and online portals. Customers can
track orders, make payments, and resolve issues easily.
Q. Short Notes on TPS and ERP

1. Transaction Processing System (TPS)

A Transaction Processing System (TPS) is an information system that records and processes
the daily routine transactions of an organization. These are operations that happen regularly,
such as sales, deposits, payroll, inventory control, or billing. TPS ensures that all transactions
are processed quickly, accurately, and without duplication.

The working of TPS is simple: it takes input data (like customer orders), processes it in real
time or in batches, and stores the results in a database for further use. For example, when you
withdraw money from an ATM, the system updates your account immediately — this is a
TPS in action.

Uses and examples: TPS is widely used in banks (ATM, fund transfers), retail stores (billing
and inventory management), and airlines (ticket booking). Its impact is high because it
ensures smooth, error-free, and reliable day-to-day operations of an organization.

2. Enterprise Resource Planning (ERP)

Enterprise Resource Planning (ERP) is an integrated information system used by

organizations to manage all key business functions through a single system. ERP combines
departments like finance, HR, supply chain, sales, and production into one database, so that
information can flow easily between them.

The working of ERP is that it centralizes data from different departments, avoids duplication,
and provides real-time updates. For example, if the sales department enters a new order, the
system will automatically update inventory, billing, and delivery schedules. This improves
decision-making and efficiency.

Uses and examples: ERP is commonly used in manufacturing companies, hospitals,

universities, and large businesses. Popular ERP software includes SAP, Oracle, and Microsoft
Dynamics. The main advantage is that ERP reduces costs, increases productivity, and
supports better planning across the organization.
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