Introduction
Information systems are concerned with gathering, organizing, processing, storing and distributing information to the relevant departments in an organization. In addition, this system also includes the technologies, people, software as well as hardware that are involved in the process. This system is necessary at every level of business function, from management to operational. It has become a core area in administering businesses and running businesses and organizations. They have been used by organizations in improving performance among the employees as well as efficiency in the use of resources (Boone, 2010).
Types of information systems
Since information needs within an organization differ i.e. the management level requires a different kind of information from that of operations, classification is necessary for relevance. Information systems are classified depending on the information it contains and the level of organization they address. Some of the common information systems are; executive support systems. This gives information to the top management level of the organization. It is therefore used in the process of decision making. In this system, information from both within and out of the organization is included. This helps top management be able to make relevant, informed and strategic decisions.
Careful analysis on the key activities is the most essential for long term decision making. The use of this type decision making process makes provision for both structured unstructured decisions. Structured are those that have outlined factors and procedures to be considered in decision making. Unstructured on the other hand are those that do not, so that they differ from one time to another depending on the conditions. The information provided in this type of a system should be wide enough and flexible so that the top managers are able make reports and derive necessary conclusions depending on the situation in their organization.
Management information system on the other hand is used by supervisors and middle level managers in controlling, planning and making decisions concerning their departments. Unlike executive information system, this system includes information from within the organization. It gathers information from operational sectors like transactional systems organizes and reports it in a form that is relevant to these managers. It gives information such as current and previous performance of the business. It can however be used by other levels of the organization. Top managers for example can use it in determining and making strategic plans on operations of the business (Shea, 2010).
Decision support system is used in making decisions whose outcome is not known with certainty where “What if” statements are used. Knowledge management system is meant to provide information to all the people within the organization. Employees of the firm for example use it. They can also create, using the same system, new knowledge and expertise and be shared to other people. This system uses networks such as intranet in sharing documents and information. Through this system, ideas, knowledge and any other form of information is shared equally and extensively within the organization.
Transaction processing system is among the widely used information systems. Information concerning day to day activities of the business is included in this system. These activities include; billing in processing and sending of invoices, production activities, calculation of taxes and inventory information. It forms the basis of all other information systems as they derive information from it. Office automation system is another information system that is meant to improve employees performance by providing better and advanced systems of operations e.g. uses of computers rather than manual procedures.
Strengths of IS
When the management is able to access all the information from the lower levels of operation, then they are able to control these activities in a profitable manner. It is also possible to detect fraud among the employees and managers. Executive and management systems are important in coordinating managers and operational activities. The problem of information overload which is a common phenomenon in the current business environment can be avoided. The problems and difficulties faced by the people in lower can be easily and identified by the management. With the use of knowledge information system, the organization a pool of knowledge and beneficial ideas is created. This is used by both middle and top level managers to improve the organization. With decision support system in place, uncertainties that may arise as a result certain decision are catered for.
Weaknesses of IS
Information systems have been used as a tool in cutting down costs by individual businesses. In this process, some posts have been done away with. This has led loss of jobs by middle level managers as well as the employees. Similarly, with the constant improvements in the area more positions may be done away with. This creates a problem of job security with information being available to all people within the organization through intranet, privacy of business has not been ensured. The organization therefore becomes vulnerable to untrustworthy employees. With centralization of information, rivals and outsiders with bad motives are able crack down the system causing great losses in monetary and economic terms (McDaniel, 2007).
Software used in IS
Database system is used in creating databases on certain areas such as information on a given employee is given in his database. It is therefore very useful to top managers in making decisions on promotions and rewards. Other programs like spreadsheet and SPSS are useful in calculations and deriving conclusion by middle level managers. Microsoft XP has been one of the widely used software in creating documents. Since this task is majorly done employees, it is mostly used at lower levels of the organization (Shea, 2010).
Conclusion
Despite the shortcomings of IS, it still remains an essential tool for management in their decision making. Similarly, for efficiency and effectiveness, it cannot be eliminated from the business. The system has also caused increased profitability by establishing a competitive advantage through it can therefore be referred to as the necessary evil.
References
McDaniel, P., Gupta, S.(2007). Information systems security. Delhi: Springer.
Shea, C., Garson, G. (2010). Handbook of public information systems. Chicago: Taylor & Francis Group
Boone, L., Kurtz ,D.(2010). Contemporary Business. California: John Wiley and Sons, 2010
