Ch. 04 Information Systems (IS)

Rev. 4: Mar., 2015

Prof. Euiho Suh

POSTECH Strategic Management of Information and Technology Laboratory(POSMIT: http://posmit.postech.ac.kr)

Dept. of Industrial & Management EngineeringPOSTECH

Contents1 Information System

2 Components of Information System

3 Technical & Behavioral Approaches to MIS

4 Role of IS

5 Types of Information Systems

6 DQ & ECQ

3

Information System (1/3)

■ Definition of System– A set of interrelated components, with a clearly defined boundary, working together to

achieve a common set of objectives by accepting inputs and producing outputs in an organized transformation processInput

• Capturing and assembling ele-ments that enter the system to be processed

Processing

• Transformation process converts input into output

4

Information System (2/3)

■ Definition of Information System– A set of interrelated components which are to collect, process, store, and distribute in-

formation to support decision making and control in an organization

Information System

Information System

5

Information System (3/3)

■ An information system performs three general activities– It accepts data from sources as input– It acts on data to process(produce) information : information generating system– The system outputs the information for the user, manager or staff member

■ Information System Process

Input of dataInput of data Information generatingInformation generating OutputOutput

Third StepFirst Step Second Step

6

Components of Information System (1/2)

A set of people, data, procedure to provide useful informa-tion

A set of people, data, procedure to provide useful informa-tion

Information SystemInformation System

Data

Procedure

Network

Communication of information

Management of activities

Decision making

People

Hardware

Software

7

Components of Information System (2/2)

Computer based loan information systems

Computer based loan information systems

Banking database

Economic database

• Fund on deposit • Loan balance • Balance financial plan• Loan portfolio

• Employment data• Economic data

Processor

Information supplied by applicant for loan• Financial status• Loan details• Employment status

■ E.g. Components of a Loan Information System

8

Technical & Behavioral Approaches to MIS

ComputerScience

OperationsResearch

Sociology

PoliticalScience

Psychology

Manage-mentScience MIS

BehavioralApproaches

Technical Ap-proaches

9

Role of IS (1/2)

View Point 1

Data Information Decision Aids Knowledge

Statistical

Analysis

Math

AnalysisReasoning

View Point 2

ExtremetopTop

Middlelow

Extreme low

EIS/ESS

DSS

IPS

TPS

OAS

ERP

View Point 3

Strategic Value

IS Expansion

H

LL H

?

?

10

Role of IS (2/2)

View Point 4

Helper A Function

Management

Marketing

Financing

Accounting

ISIS

ISIS

ISISManagement

ISIS

Marketing Accounting

Financing

Controller

ISIS

MarketingAccounting

Financing

Melting Pot

IS

MarketingAccounting

Financing

All Functions are melted

11

Types of Information Systems (1/12)

ISRecognition about Infor-

mationMotivation Purpose

TPS (Transaction Pro-cessing System)

Efficiency ComputerTo process data about transac-tions

MIS/IPS (Management Information System/ In-

formation Processing Sys-tem)

Control DatabaseTo process information (cooked data)

DSS (Decision Sup-port System)

Decision PC and

Model based

To assist managers with optimal decisions for semi-structured problems

ESS (Executive Sup-port System)

Strategic Re-source

Executive Sup-port

To assist top-level executivesUpper-level DSS

ES (Expert System) Knowledge AITo mimic the decision process of a human expert

ERP (Enterprise Re-sources Planning)

Management BPR

To integrate management infor-mation across entire organization, Vertical and horizontal integration of IS’s

Work Group Support System

CommunicationCommunica-

tionTo support group infor./decision collectively

12

Types of Information Systems (2/12)

■ 3-Axis MSS Model

Model

Data

Intelligence

IS Type = f(m, d, i)

a?

c?

b?

Ex)TPS = f(0.1, 0.9, 0)DSS = f(0.5, 0.3, 0.2)

Ex)TPS = f(0.1, 0.9, 0)DSS = f(0.5, 0.3, 0.2)

13

Types of Information Systems (3/12)

■ Transaction Processing Systems (TPS)– IS to process transactions handling mostly data with arithmetic operations such as

plus, minus, multiplication, and division– Examples) ATM, KTX Ticketing, Self Check-in Kiosk

14

Types of Information Systems (4/12)

■ Management Information System (MIS)/Information Processing System (IPS)– IS to process information (cooked data, statistically analyzed data)– Statistical analysis – Examples) POS (Point-of-sale) – What kinds of analysis are included in POS?

15

Types of Information Systems (5/12)

■ Decision Support System (DSS)– IS to support manager’s decision makings for semi-structured problems– Three components: DB/DBMS, MB/MBMS, Dialogue (DgB/DgMS)

• Eui-ho Suh and H. Hinomoto, "Use of A Dialogbase for Integrated Relational Decision Support System", Decision Support Systems, 5(3), pp. 227-286, 1989

– Examples) Investment Planning• Eui-ho Suh, Chang-kyo Suh and Nam-chul

Do, "A Decision Support System for Investment Planning on a Microcomputer", Journal of Microcomputer Application, 15(4), pp 297-311, 1992

– Examples) Make or Buy

16

Types of Information Systems - Taxonomy for DSS by Daniel Power (6/12)

■ Communication-driven DSS – To support more than one person working on a shared task– Examples) Integrated tools like Google Docs or Groove

■ Data-driven DSS or data-oriented DSS – To emphasize access to and manipulation of a time series of internal company data

and, sometimes, external data

■ Document-driven DSS– To manage, retrieve, and manipulate unstructured information in a variety of electronic

formats

■ Knowledge-driven DSS – To provide specialized problem-solving expertise stored as facts, rules, procedures, or

in similar structures

■ Model-driven DSS – To emphasize access to and manipulation of a statistical, financial, optimization,

or simulation model– To use data and parameters provided by users to assist decision makers in analyzing a

situation– Not to be necessarily data-intensive– Examples) Dicodess, an open source model-driven DSS generator.

17

Types of Information Systems (7/12)

■ Executive Information System (EIS)– To present information for top management

• To support problem/opportunity discovery and assessment• To be used for control and strategic planning

– To be multimedia systems

– To provide summary and detailed information, with the ability to “drill down” into the data

– To provide internal and external information

– To provide different time and space information

18

Types of Information Systems (8/12)

■ Executive Information System (EIS)/Executive Support System (ESS)– A type of DSS for executives

– EIS is interchangeably used with ESS, but, sometimes it is only an executive version of IPS while ESS is an executive version of DSS• Eui-ho Suh and Dae

-ho Byun, "A Builder's Introduction to Executive Information Systems", International Journal of Information Management, 14, pp. 357-368, 1994

– Examples)• Conoco’s EIS• Executive Dashboard: UA

19

Types of Information Systems - Expert System (ES) (9/12)

■ Definition– Computer-based information systems that use expert knowledge to attain high-level

decision performance in a narrowly defined problem domain– Example) MYCIN

■ Features of ES

Expertise Containing expertise that enables ES to make

expert-level decisions

Symbolic rea-soning

Containing symbolically represented knowl-edge and symbolic primary reasoning mecha-nism

Deep knowl-edge

Containing complex knowledge not easily found among nonexperts

Self-knowledge

Learning from its successes and failures as well as other knowledge sources and examining its own reasoning and providing proper explana-tions

20

Types of Information Systems - Important Concepts in ES (10/12)

■ Experts– Degrees or levels of expertise– Nonexperts outnumber experts often by 100 to 1

■ Transferring Expertise– From expert to computer to nonexperts via acquisition, representation, inferencing,

transfer

■ Inferencing – Knowledge = Facts + Procedures (Rules)– Reasoning/thinking performed by a computer

■ Rules (IF… THEN…)

■ Explanation Capability (Why? How?)– Chang-kyo Suh, Eui-ho Suh

, "Using Human Factor Guideline for Developing Expert System", Expert Systems, 10(3), pp 151-156, Aug. 1993

21

Types of Information Systems - Architecture of an ES (11/12)

Modeling of Manufacturing Systems

Abstract

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KnowledgeEngineer

KnowledgeBase(s)

InferenceEngine

Expert(s) Printed Materials

UserInterface

WorkingMemory

ExternalInterfaces

Solutions Updates

Questions/Answers

StructuredKnowledge

ControlStructure

Expertise Information

Base ModelData Bases

Spreadsheets

Knowledge

22

Types of Information Systems - ERP (12/12)

■ Enterprise Resource Planning

EIS/ESS

DSS

IPS

TPS

OAS

FIS AIS MkIS PIS

Vertical integrated, hori-zontal integrated informa-tion system

ERPLayer

Function

23

DQ & ECQ

■ 1 Six components of IS■ 2. Least or most important component. Why ?

■ 3. If one more added, what would it be ?■ 4. Explain each viewpoint

■ 5. For each case, classify it in terms of four different viewpoints. ■ 6. For each IS, classify it in terms of 3-axis MSS model

■ 7. For each IS, name the type of IS ■ 8. For each type of IS, provide your own example