Lesson 1 – Introduction to Information Systems

Objective

The objective of this lesson is to give you an insight into :

The bottom-line of everything in this world, i.e. the ‘SYSTEM’.

System Characteristics.
Various types of Systems.
System approach to problem solving.

Introduction

Now we are going to start our topic named “Structured System Analysis and
Development”. As we all know that in today’s scenario, everybody is looking for a
perfect system which can be able to solve their any type of problem, now that
problem can either be for a person sitting in home or for any huge organization. In
this chapter, we will be going to deal various aspects of a system which we can make
use for solving the complexities that can possibly arise in our old way of working, to
increase efficiency and accuracy in our ongoing system, and above all saving that
time which we unnecessarily waste on other works. This chapter includes the
following topics:

Definition, features and components of a system.

Systems Theory.
Categories of a system.
Business systems.
Categories of information systems.
Before beginning with the topic, I would like to ask that what do you mean by a
System? How can you define any System?

In a very broad sense, a system is simply a set of components that interact to

accomplish some purpose. Systems are all around us. For example: you experience
physical sensations by means of a complex nervous system., a set of parts, including
your brain, spinal cord, nerves, and special sensitive cells under your skin that work
together to make you feel hot, cold, itchy, and so on. You communicate by means of
language, a highly developed system of words and symbols that conveys meanings
to you and to others.
Therefore, any System is defined as a collection of elements or components that are
organized for a common purpose. The word sometimes describes the organization or
plans itself (and is similar in meaning to method, as in "I have my own little
system") and sometimes describes the parts in the system (as in "computer
system"). Another Example of a System is any computer system that consists of
hardware components that have been carefully chosen so that they work well
together and software components or programs that run in the computer.

Lets take examples of some commonly heard systems, which play an important role
in our life. These can be listed as:
Solar System.
National Transport System.
Computer System.
 Ecological System.
Biological System and so on.

Therefore a system is a collection of components, which are related to each

other and they interact to accomplish some purpose.
Hence, Common features of any system can be included as following:
A set of components
A goals/objective
Presence of interaction

Components of a system

Here is the definition for the terms used in the above figure (figure:1.1)

Boundary
Defines the scope (internal and external). A system should be defined by its
boundaries –the limits that identify its components, processes and
interrelationships when it interfaces with another systems. For example, a teller
system in a commercial bank is restricted to deposits, withdrawals and related
activities of customer’s checking and saving accounts.

Environment
The outside world in which the systems exists. It is the source of external
elements that impinge on the system. In fact, it often determines how a system
must function. For example, organization’s environment consisting of vendors,
competitors and others, may provide constraints and consequently influence the
actual performance of the system.

Interface
Systems in real life do not operate in isolation. One system has interface with
one or more systems that are in their active phase of life cycle. Output of one
system is1ised as an input by other systems: These interfaces are often
expresses in form of information interchange by way of inputs and outputs. In
case of management information systems, it is possible to identify such
interfaces by person, activity, function, depm1ment or another system with
which the management information system has interface by way of input,
output or both input and output.
Inputs
Anything to be captured by the system from its environment. Inputs are the
elements (material, human resources, information) that enter the system for
processing.
 Outputs
Anything produced and sent into its environment. Outputs are the outcome of
the processing.

Feedback
The outputs would be used as a CONTROL element to balance between the
actual and standard performances defined within a system. Feedback may be
positive or negative, routine or informational. Positive feedback reinforces the
performance of the system. It is routine in nature. Negative feedback generally
provides the controller with information for action.

Now what are the various ways to categorize the Systems?

A system can be classified into two categories, namely:

Physical or Abstract Systems

OPEN and CLOSED SYSTEMS, and

Deterministic and Probabilistic Systems

Let’s take them one by one.

Physical or Abstract Systems

Physical systems are tangible entities that may be static or dynamic in operation. For
example, the physical parts of the computer center are the offices, desks and chairs
that facilitate operation of the computer. They can be seen and counted; they are
static. In contrast, a programmed computer is a dynamic system. Data, programs,
output and applications change as the user’s demands or the priority of the
information requested changes.
Abstract Systems are conceptual or non-physical entities. They may be as
straightforward as formulas of relationship among sets of variables or models-the
abstract conceptualization of physical situations. A model is a representation of a real
or a planned system.

OPEN and CLOSED SYSTEMS

The name itself is self-explanatory. Systems can be classified on the basis of

their interfaces with the environment in which they operate. The systems that
have interfaces with the environment are considered as open systems. These
systems are either open to inputs from the environment or are open to provide
output to the environment.

In real life systems, many have multiple interfaces with the environment.
Since, these systems are interacting with the environment in which they
operate, they are called as open systems.

The systems that do not have any interaction with the outside world are called
as closed systems. Closed systems have no interaction with the environment
 in which they operate.

It is very easy to find examples of open systems. Information systems in

general are open systems. They receive input from the environment and they
generate outputs that are given to entities outside the scope of the system that
is to the environment in which they operate. It is, however, difficult to find
examples of closed systems. Some scientific research systems are known to
operate without any interaction with the environment in which they operate.
But when we say that there exists a one-man show then you can assume that
there exists a closed system. Almost all the business and social systems in real
world are open systems. They have multiple interfaces with the environment in
which they operate. The environment is not static. The environment keeps on
undergoing changes from time to time. Open systems have to be flexible
enough to adapt to the changing environment in order to remain in existence.
Management information systems are open systems.

Deterministic and Probabilistic Systems

Just as systems are classified on the basis of their interactions with the
environment – open and closed systems, systems can also be classified on the
basis of their results. There are systems whose results can be predicted and
there are systems whose results cannot be predicted. Systems can also be
classified into deterministic and probabilistic systems based on the predictability
of the results. The systems whose results can be predicted are called as
deterministic system. The systems whose results cannot be predicted are
called as probabilistic systems.

The solar system is a simple example of deterministic system. The movement of

planets can be predicted to high degree of precision as the planets movement is
taking place as per specific predetermined rules. The solar system is based on
specific rules and therefore the outcome can be predicted. Similarly, computer
systems contain programs. Programs contain certain set of instructions that are
followed during its execution. Programs are performing specific operations in
accordance with predetermined set of rules and conditions embedded in the
program. Thus computer systems become deterministic systems.

On the other hand, there are systems whose results cannot be predicted with
precision. The results of these systems can be predicted with certain degree of
probability. These systems are probabilistic systems. Sales forecasting system is
an example of probabilistic system. One cannot say with high degree of
confidence that the result of the system would match exactly with real world
situation. One can only predict with certain degree of probability. Sales
Forecasting, Budgetary Planning, Revenue projections etc. are some of the
examples of probabilistic systems.

Apart from Systems, we can have Subsystems also in our organization. Now, what
is actually a subsystem?

Define Subsystem?

A system may comprise of many smaller systems, or a system may be made up of

different levels of subsystems.
It is necessary to treat each sub-system on its own and regard it as a separate.
Where a large systems is broken down into smaller more manageable components.

Controls within a system

Negative Feedback
When information about the output state is compared against the desired state, the
control mechanism acts so as to reverse any discrepancies.

Positive Feedback
When a systems responds to an increase in outputs by increasing the inputs (vice
versa).
This may result in disastrous effects.

Predictor
This method uses inputs from the current state of the system together with a
predictive model of the process so as to estimate the future state of the
system.
The predications made are then compared with the desired state.
Adjustment would be made of any potential errors are uncovered.

Following are the definitions used in the above figure (i.e. figure:1.2)

Sensor it measures the current state of he system outputs.

Comparator here the state of the output is measured against the desired state
Effectors If there are any discrepancies between the output and the standard then
some changes are made in the system through the input by an effectors.
The Control Loop enables the system to control its state.
Information flows through the control loop; from the output back to the inputs via
the closed loop.
If the loop is broken in any point then the system can no longer control itself.

The flow of control is important to business as it enables management to

monitor what occurs in business at any particular time to make proper
decision.

Control Model
 A standard for acceptable performance
A method of measuring actual performance
A means of comparing actual performance against the standard
A method of feedback

Now understanding the various Implications of System Theory,

Provides a unified theoretical Framework

Shows information systems as part of an organizational whole
Highlights control issues in management
Reveals the multiple interactions of subsystems with the environment
Since, we have covered the basics of systems, let’s move ahead and try to figure
out what types of systems exist in our environment.

Now how would you define any Business System??

A Business is also like any other system that performs so many distinct tasks and
composed of so many different components. Its components includes- marketing,
manufacturing, sales, research, shipping, accounting, and personnel- all work together to
create a profit that benefits the employees and stockholders of the firm. Each of these
components is itself a system. The accounting department, for example, may
consists of accounts payable, accounts receivable, billing, auditing, and so on.

Organizations consist of many business systems, each having the features of the
general system discussed in the preceding section. For example, all manufacturing
systems have similarities. Their purpose is to produce goods or produce goods or
products that fulfill a demand in the market. To achieve this objective, the systems
interact with their environments to acquire the necessary materials, workers, and
knowledge to manufacture the goods. None of the inputs can be omitted if
manufacturing is to continue. The manufacturing systems also produce outputs, such
as finished products, waste, and production technology.

To keep functioning, manufacturing systems must be under control. For example,

they must meet performance standards. The quantity of products manufactured
must meet budgeted quotas and achieve acceptable quality and cost levels.

Managers and employees continually monitor actual performance and compare it

against planned productivity. If there are differences or if efficiency is below
expectations, changes are made. In this sense, manufacturing systems are self-
regulating and self-adjusting; they indicate whether and when personnel must be
replaced, new equipment must be purchased, or procedures must be modified. If
internal adjustments are not satisfactory-there are too many injuries, quality is
dangerously low, or prices are unreasonable-regulatory forces in the environment
may intercede.

Manufacturing systems are themselves subsystems within large organizations and

are in turn made up of other subsystems for acquiring materials, maintaining
equipment, and training workers. The general features of all systems are identical.
Any system can be examined with this framework in mind and specific details added
as necessary. It is this flexibility that makes systems concepts so useful to business
in general and to information systems design in particular.
What is Business Information Systems?
The purposes of information systems, like any other system in an organization, are
to process input, maintain files of data about the organization, and produce
information, reports, and other output.

Information systems consist of subsystems, including hardware, software, and data

storage for files and databases. The particular set of subsystems used-the specific
equipment, programs, files, and procedures-constitutes an information systems
application. Thus, information systems can have purchasing, accounting, or sales
applications.

Since information systems support other organization systems, analysts must first
study the organization system as a whole and then its information systems details.
Often, organization charts (figure:1.3) are used to describe how the organization's
components, such as divisions, departments, offices, and people relate to one
another. Although the charts may accurately show the formal relationships between
the components, they do not tell how the business system operates, since there are
many important details that cannot be described in the charts. Examples of other
system details that are important to system analysis include:

1) Informal channels : What interactions between people and department

exist but are not shown on the organization chart or in prescribed
operation procedures?
2) Interdependence : On which other departments and components in the
organization is a particular element dependent ?
3) Key people and functions : Which individuals and elements in the
system are most important for successful existence ?
4) Critical communication links : How do information and instructions
pass back and forth between organization components ? How do areas
interface with each other ?

Organization charts leave many systems questions unanswered.

Information Requirements within a Business System

Information Systems (IS) in organizations capture and manage data to produce

useful information that supports an organization and its employees, customers,
suppliers and partners. Many organizations consider information systems to be
essential to their ability to compete or gain competitive advantage. Most
organizations have come to realize that all workers need to participate in the
development if Information Systems. Therefore, Information system development is
the relevant subject to you regardless of whether or not you are studying to become
Information System professionals.

An information System is the basis for interaction between the user and the analyst.
It provides the instructions, commands and feedback. It determines the nature of
relationship among decision makers. Systems analysts develop several different
types of information systems to meet a variety of business needs. There is a class of
systems, which are collectively known as Computer Based Information Systems
(CBIS). Just as highway systems, railway systems and airline systems are different
types of transportation systems, so there are several types of computer based
information systems. They are classified as Office Automation Systems (OAS),
Transaction Processing Systems (TPS), Management Information Systems (MIS) and
Decision Support Systems (DSS).

Type of Information Systems:

Different types of information systems have been developed to meet a variety of

business needs. These systems are collectively known as computer based
information systems. As we have different types of transportation systems such as
railway systems, highway systems and, airline systems, computer based information
systems also of many types. They are classified as:
Office Automation System(OAS).
Transaction Processing Systems (TPS) .
Management Information Systems (MIS).
Decision Support Systems(DSS).
Knowledge Based Systems(KBS).
Activity1: What do you mean by system? Explain any system from the
outside world specifying its various components.

Activity:2 Explain any three characteristics of family as a system

Activity:3 Find out the input and output elements in a Computerized Library
Management System.

Activity:4 Explain the importance of the information system to the business

enterprise.
STUDENT NOTES