An information system is “A combination of hardware, software, infrastructure & trained personal organized to facilitate planning, control, coordination & decision making in an organization. (Businessdictionary.com, 2011)

Explanation of IS

In this era, an Information system plays an important role in an organization because it makes work easy, secure & efficient and also it helps the organization to lessen the mistakes and boost up the work. In this modern world, there are a variety of requirements for information in the organization. For example, senior managers need information to help with their business planning. Middle management needs more detailed information to monitor and control the business activities in order to provide a perfect system.

As it is clear from the above explanation, that information helps the organization to provide the significant information to different levels of the organization. In other words, Information systems are created to utilize & design the work (probably like databases) for decision making at the end.

(tutor2u.net, 2011)

EXAMPLE OF INFORMATION SYSTEM

Anything that can generate reports detailing the day to day, monthly, quarterly or annual operations. Think of a sales team of 10 employees who make commission monthly on all closed sales for the previous month, IS would have the ability to generate a report detailing the info required to accurately determine the correct compensation. Some IS depts. also help in auditing, quality control, and even mergers. (Wiki.answers.com, 2011)

TYPES OF INFORMATION SYSTEM

Information systems have four major categories which are defined and summarized below:

Executive Support System (ESS): An Executive Support System (ESS) “is designed to help senior management make strategic decisions. It analyses, gathers and summarises the key internal and external information used in the business.” (tutor2u.net, 2011)

Transactions Processing System (TPS): As the name implies, Transaction Processing Systems ("TPS") are designed to process routine transactions efficiently and accurately. A business will have several (sometimes many) TPS for example:

- Billing systems to send invoices to customers
- Systems to calculate the weekly and monthly payroll and tax payments
- Production and purchasing systems to calculate raw material requirements
- Stock control systems to process all movements into, within and out of the business

(tutor2u.net, 2011)

Management Information System (MIS): A management information system (MIS) is mainly concerned with internal sources of information. MIS usually take data from the transaction processing systems (see below) and summarise it into a series of management reports. (tutor2u.net, 2011)

Decision Support System (DSS): Decision Support System is “designed to provide assistance in determining & evaluating alternative courses of action. A DSS acquires data from the mass of routine transactions of a firm, analyses it with advanced statistical techniques to extract meaningful information and narrows down the range of choices by applying rules based on decision theory.” (Businessdictionary.com, 2011)

There are other information systems but these are the major and known categories of information systems.