Chapter 1, Problem 1LO

Program Plan Intro

To determine basic types of information system, their users, method of usage, and their benefits.

Program Description Answer

Basic types of information system are:

• Management information system
• Decision support system
• Transaction processing system
• Executive support system

Explanation of Solution

Management Information System (MIS) is a business function, like accounting, human resources, operations which moves information about people, products and processes across the company to facilitate decision making, and problem solving. MIS solves the issue with information silos.

Decision Support System (DSS) is needed to enable managers to get answers of unexpected and nonrecurring type of situation. It provides flexible tools for analysis that helps middle managers. DSS is used to analyses present data and find favorable alternate options for the problem. It must be noted that DSS only suggest solutions. It does not take decisions and the final decision-making is up to the decision maker.

Transaction processing system helps organization keep records of all transaction within and outside company. It also helps keep routine operations so there should be no lack or inefficiency in organization’s work.

Executive support system consists of sophisticated software that can present, summarize, and analyses data from an organization’s databases. ESS is typically built to support daily task and reporting of lower-level employees. ESS such as Tally for accounting helps gather generated data and extract useful information. The main purpose of ESS is to enhance productivity and maintain professional work quality.

MIS is used by top and middle level management of organizations. It helps them gain overall insight of the organization’s process and project status.

DSS basically helps managerial level employee of an organization, it supports their decision while it does not make decision for them but helps in providing statistical backup to their decision.

TPS helps maintain records of business transaction in an organization. It helps lower-level employees and record keep department of an organization.

ESS supports lower-level employee in performing their daily tasks and it supports their decision while performing their duties.