Briefly explains the concept and types of information systems

1. FOUNDATIONS OF INFORMATION SYSTEMS
- Lesson 1 -
Angelina Njeguš, PhD
Associate Professor at Singidunum University
Belgrade - Serbia, 2013

2. Prof. dr Angelina Njeguš
System Concept
Entity 1 Entity 2
Entity N Entity 3
System boundary
Environment
Input Output
Feedback

3. Prof. dr Angelina Njeguš
Data, Information, Knowledge, Wisdom
Source: Swindoll, 2011
(Available at: http://www.pursuant.com/blog/tag/dikw-model/)

4. Prof. dr Angelina Njeguš
Information Systems (IS)
 Organised and integrated set of:
 Data
 Processes
 Interfaces
 Networks
 Technologies
 People
that are correlated in order to support
and improve everyday business
operations and decision making

5. Prof. dr Angelina Njeguš
Information Systems
Real life system
Information System

6. Prof. dr Angelina Njeguš
Basic IS Activities
Output
Input
Processing
Storage
Control
Source: O-Brien et al., 2010

7. Prof. dr Angelina Njeguš
Information Processing Cycle
Source: Morley et al., 2013

8. Prof. dr Angelina Njeguš
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(OLAP cubes,
Operational BI…)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI …)
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards …)
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps

9. Prof. dr Angelina Njeguš
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(OLAP cubes,
Operational BI…)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI …)
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards …)
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps

10. Prof. dr Angelina Njeguš
Operations Information Systems (OIS)
 Organised set of:
─ hardware
─ software
─ databases
─ telecommunications
─ people
─ procedures
that are configured to:
─ collect
─ manipulate
─ store
─ process
data into information, and support an
organisation’s day-to-day business activities
Any organised
combination of …
Data
Processes
Policies and
procedures
Interfaces
Communi-
cation
networks
Technologi-
es
People

11. Prof. dr Angelina Njeguš
Operations Information Systems (OIS)
 Support operational
processes that
constitute the core
business and create the
primary value stream
 Typical operational
processes are:
 Finance
 Manufacturing
 Marketing
 Human Resources ...
Source: Rosen, 2006

12. Prof. dr Angelina Njeguš
Transaction Processing Systems (TPS)
 TPS collects, store, modify, and retrieve business trasactions
 A transaction is an event that generates or modifies data that are
stored in an information system
 Any business-related exchange, such as payments to employees, sales
to customers, payments to suppliers ...

13. Prof. dr Angelina Njeguš
Ways to Process Transactions
Batch processing
• Accumulate transactions
over time and then process
periodically
• Example: During the night, all
daily OLTP database changes
are all at one time extracted,
transformed, and loaded into
the data warehouse
Online processing
• Process all transactions
immediately
• Example: A bank system
processes ATM withdrawals
immediately

14. Prof. dr Angelina Njeguš
Some TPS features
 The main purpose of the TPS is to ensure the consistency and integrity of
data
 For example: In case of e-payment amount must be withdrawn from one
account and added to another. If transaction fails, than rolleback function
deletes all data changes that have occurred since the beginning of the
transaction.
Source: IBM, 2012

15. Prof. dr Angelina Njeguš
Some TPS features (cont.)
 Transaction systems must be able to support a large number
of concurrent users and transaction types
 For example: Multiple operators simultaneously access airline reservation
system. When one operator access, booking is locked until it is completed.
Otherwise, another operator could access the same data and make double
booking.

16. Prof. dr Angelina Njeguš
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(OLAP cubes,
Operational BI…)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI …)
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards …)
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps

17. Prof. dr Angelina Njeguš
Business Process Management Systems
 Business process is a collection of related, structured, and coordinated
value-added activities that combine available resources (input) to produce
a specific output (product or service)
 For instance, the process of filling a customer order involves several related
tasks.
Source: Interfacing, 2011

18. Prof. dr Angelina Njeguš
Business Process
 A business process transforms inputs into outputs, according
to guidance (business policies, standards, procedures,
business rules, etc.) employing resources of all types
Input Output
Guidance
Resources

19. Prof. dr Angelina Njeguš
Examples of Business Processes
 Accounting Business Processes:
– Accounts payable
– Accounts receivable
– Cash receipts
– Invoice billings ...
 Finance Business Processes:
– Account collection
– Bank loan applications
– Business forecasts
– Customer credit approval and
credit terms ...
 Marketing Business Processes:
– Customer satisfaction surveys
– Customer service contracts
– Customer compliant handling
– Sales order entry ...
 Production/Operations Business
Processes:
– Bill of materials
– Quality control for finished goods
– Packing, storage, and distribution
– Shipping and freight claims ...
 Human Resources Business
Processes:
– Disabilities employment policies
– Employee hiring policies
– Files and records management
– Health care benefits
– Pay and payroll
– Training/tuition reimbursement
– Workplase rules and guidelines ...
Source: Rainer et al., 2011

20. Prof. dr Angelina Njeguš
Why are BPM systems important?
 Business processes are strategic assets of an organization that must be
understood, managed, and improved to deliver value-added products and
services to clients – the goal of BPM systems
 Economics: globalization demands flexibility
 Business processes: changing quickly, shrinking cycle times
 Revenue growth: at the top of CEO agenda
 Reusable assets: can cut costs
 Business Process Reengineering (BPR) – continuous process improvement
 Business process management (BPM) systems give organisations the
flexibility to quickly respond to changes in the competitive environment

21. Prof. dr Angelina Njeguš
Business Process Management
 Discover, document, automate, and continuously improve business processes to
increase efficiency and effectiveness while striving for innovation, flexibility, and
integration with technology

22. Prof. dr Angelina Njeguš
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI…)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI …)
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards …)
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps

23. Prof. dr Angelina Njeguš
Office and Collaboration Systems
 A suite of applications (Software packages) for creating, editing, and
sharing text, spreadsheet, presentations and other documents in order to
facilitate and speed up the daily office tasks, as well as mutual business
communication

24. Prof. dr Angelina Njeguš
Collaboration Systems
 Support communication, and coordination among teams and work groups
over geographic distances
 Depending on the level of collaboration, can be divided into three
categories:
 Communication tools - interchange of messages, files, data, or documents in
order to facilitate the sharing of information
─ Examples: e-mail, voice mail, chat, Wikis, Web publishing ...
 Conferencing tools - refers to interactive work toward a shared goal
─ Examples: Internet forums, online chat, Internet telephony, video conferencing,
electronic meeting systems, Webcast ...
 Collaborative management tools – facilitate and manage group activities
─ Examples: Time management software, Document Management Systems, Project
management systems, Social software systems ...

25. Prof. dr Angelina Njeguš
Collaboration Systems

26. Prof. dr Angelina Njeguš
Collaboration Systems

27. Prof. dr Angelina Njeguš
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI…)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI …)
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards …)
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps

28. Prof. dr Angelina Njeguš
Operational data
Information
Business Intelligence Systems
 Set of tools and systems for gathering, extracting, storing, analyzing and
translating business information into knowledge to support decision-
making and improve overall business effectiveness
Knowledge
workers

29. Prof. dr Angelina Njeguš
Operations vs BI systems

30. Prof. dr Angelina Njeguš
Decisions

31. Prof. dr Angelina Njeguš
Business Intelligence System

32. Prof. dr Angelina Njeguš
Decisions are based on

33. Prof. dr Angelina Njeguš
Why Business Intelligence?
• What happened?
• What is happening?
• Why did it happen?
• What will happen?
• What do I want to happen?
ERP CRM 3PtySCM
Past
Present
Future
Data

34. Prof. dr Angelina Njeguš
Frontend tools
34

35. Prof. dr Angelina Njeguš
Decision structure

36. Prof. dr Angelina Njeguš
BI Pyramid
KPIs, Scorecards, Dashboards
OLAP, Mining, Forecasting
Management Reports
Detailed Operational
Reports
INVOICES, SHIPPING DOCUMENTS, PICK LIST
SALES TOTALS, LEADS ANALYSIS, CLICK THROUGH
RATIOS, BUDGETS
PERFORMANCE, PRODUCTION
TIMES, CUSTOMER CHURN
METRICS
Complexity
Quantity
Executives,
Top Managers
Professionals, Problem
solvers, Middle manager
Front-line manager
Transactors
OPERATIONAL
TACTICAL
STRATEGIC
REAL TIME

37. Prof. dr Angelina Njeguš
Types of Business Intelligence
Systems
 Operational BI: Management Information Systems (MIS)
 Provides routine information to managers and decision makers
 Primary focus is operational efficiency
 Reports and displays
 Example: daily sales analysis reports
 Tactical BI: Decision Support Systems (DSS)
 Used to support problem-specific decision making
 Focus is on decision-making effectiveness
 Interactive OLAP and ad hoc decision support, data mining method
analysis, predictive analytics
 Example: where to spend advertising dollars
 Strategic BI: Executive Information Systems (EIS)
 Critical information for executives and senior managers
 Example: easy access to actions of competitors, BSC, KPI ...

38. Prof. dr Angelina Njeguš
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI…)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI …)
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards …)
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps

39. Prof. dr Angelina Njeguš
Expert Systems (ES)
 Field of Artifical Intelligence (AI)
 AI focuses on the development and study of systems that support human
behavior and intelligence (learning, understanding, problem solving,
reasoning, knowledge, etc.)
 The most important subdomains of AI are:
 Natural Language Processing
 Interpretation and processing of visual information and signals (Biometrics ...)
 Robotics
 Knowledge based systems or Knowledge Engineeering (Expert Systems ...)
 Software Agents or Intelligent Agents
 Machine Learning (Data Mining, Speech recognition, Text analysis ...)

40. Prof. dr Angelina Njeguš
Expert Systems
 Simulate the knowledge, and reasoning process in solving complex
problems and emulates the decision-making ability of an expert in order
to arrive at the same conclusions as a human expert would
 Expert in a specific field:
 has a high-degree of knowledge, skill, and experience
 Understands the problem and recognizes structured and typical problem-
solving process
 Has heuristic knowledge (resillience, good judgment ...)
 Recognizes the fastest way to come up with the soultion ...
 Some knowledge representation techniques are:
 Rules: IF you are hungry THEN eat
 Semantic nets: graph with logically connected nodes ...

41. Prof. dr Angelina Njeguš
ES Architecture
Source: Abacus, 2009

42. Prof. dr Angelina Njeguš
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI…)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI …)
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards …)
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps

43. Prof. dr Angelina Njeguš
Geographic Information Systems
Source: Bisag, 2009.

44. Prof. dr Angelina Njeguš
Storing GIS Data for the Web
 The steps of serving a map are:
 Data are aggregated in a database
 Data are transformed into an image using
a rendering engine
 The image is served through a map server
 The main types of GIS data:
 Vector data (points, lines, and polygons)
are stored in tables as sets of geographic
coordinates and attributes .
 Raster data - collections of pixels that
make up images
 XML has become an important language
for transferring geographic data over the
internet
 Open Geospatial Consortium (OGC)
defined a Geography Markup Language
(GML) standard
Source: Bisag, 2009.

45. Prof. dr Angelina Njeguš
GIS Applications
Source: Abukhater, 2011.

46. Prof. dr Angelina Njeguš
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI…)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI …)
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards …)
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps

47. Prof. dr Angelina Njeguš
Knowledge Management
Systems
 IT-based systems developed to support, manage and
enhance the organisational processes of knowledge
creation, storage/retrieval, transfer, and application
Source: ITSM, 2008

48. Prof. dr Angelina Njeguš
Information Technology
Infrastructure Library - ITIL
 Documented set of best practices for IT service management
(ITSM) that focuses on aligning IT services with the needs of
business
 ITSM is a discipline for managing IT systems
 ISO/IEC 20000 standard - the first international standard for IT service
management
 ISO/IEC 20000 certification is an assessment of IT department as a
means of showing that organization reached a level of maturity for
services delivery

49. Prof. dr Angelina Njeguš
Best practises

50. Prof. dr Angelina Njeguš
Types of Information Systems
Information
Systems
Operations
Information Systems
Transaction
Processing
Systems
Business
Process
Management
Systems
Office and
Collaboration
Systems
Business Intelligence
Systems
Management
Information
Systems
Decision
Support
Systems
Executive
Information
Systems
Business
Operations
Support
Decision
making
support
Systems for Process
Modelling, Simulation,
Execution, Control and
Optimisation
Processing Business
Transactions
Prespecified Reporting
for Managers
(Operational BI…)
Interactive Decision
Support (Data
Mining method
analysis ...)
Critical Information
for Senior
Management (BSC,
KPI, Strategic BI …)
Expert Systems
Knowledge
Management
Systems
Manage Organisational
Knowledge (ITIL, ISO
Standards …)
Office and Team
and Workgroup
Collaboration
Systems
Specialised
Information
Systems
Virtual Reality
3D Simulation of a Real or
Imaginary Environment
(tool for communication,
entertainment, and learning)
Emulates Expert
Problem Solving
Geographic
Information
Systems
Intelligent
Maps

51. Prof. dr Angelina Njeguš
Virtual Reality
 3D simulation of a real or imaginary environment
 Tool for communication, entertainment, and learning
 Virtual Reality in Tourism can be used:
 to recreate historic sites and events
 to provide a means of protecting the fragile state of some heritage
 to create virtual experiences (virtual tours) for tourists
 to create virtual guides
 for marketing, planning and management, entertainment, education,
accessibility ...

52. Prof. dr Angelina Njeguš
Second Life I-Room
 Virtual Space for Intelligent Interaction

53. Prof. dr Angelina Njeguš
Trends in Information Systems
Source: O’Brien, 2010

54. Prof. dr Angelina Njeguš
References
1. Swindoll, C. (2011) „Redefining Fundraising – Data“, Pursuant [Online]. Available at: http://www.pursuant.com/blog/tag/dikw-model/
(accessed: 1.11.2012)
2. O’Brien, J.A., Marakas, G.M. (2010) Introduction to Information Systems, McGraw-Hill Companies, Inc.
3. Rosen, S. (2006) „Information Systems in the Enterprise“, Santa Rosa Junior College [Online]. Available
at:http://www.santarosa.edu/~srosen/CIS66/ch2notes.htm (accessed 2.11.2012)
4. IBM (2012) „Rolling back work“, IBM [Online]. Available at:
http://publib.boulder.ibm.com/infocenter/dzichelp/v2r2/index.jsp?topic=%2Fcom.ibm.db2z10.doc.intro%2Fsrc%2Ftpc%2Fdb2z_rollbackwork.
htm (Accessed, 2.11.2012)
5. Interfacing Technologies Corporation (2011) „What is Business Process Management (BPM)?“, ODESIA Co. [Online]. Available at:
http://www.interfacing.com/Literature/what-is-bpm (accessed: 2.11.2012)
6. Rainer, R. K., Cegielski, C.G. (2011) Introducing to Information Systems: Enabling and Transforming Business, 3rd edition, Wiley & Sons, Inc.
7. Kaur, E.B, Kaur, E.S. (2012) „Overview of Intelligent Systems“, International Journal of Computing & Business Research.
8. Abacus (2009) „Artificial Intelligence Systems“, Abacus Programming Corporation. Available at:
http://www.abacuscorp.com/artificial_intelligence_systems.htm (accessed: 7.11.2012)
9. IT Service Management (2008) „ITIL Service Management“. Available at: http://itservicemngmt.blogspot.com/2008/03/iso-20000-
rediscovered.html (accessed 7.11.2012)
10. Morley, D., Parker, C. (2013) Understanding Computers: Today and Tomorrow, 14th Edition, Course Technology Cengage Learning, Boston, MA,
USA.
11. Bisag (2009). Thrust Areas for Geo-informatics Applications. Bhaskaracharya Institute For Space Applications and Geo-Informatics. Available at:
http://www.bisag.gujarat.gov.in/research.htm (accessed 16.07.2013)
12. Abukhater, A. (2011). GIS for Planning and Community Development: Solving Global Challenges. Directions Magazine. Available at:
http://www.directionsmag.com/articles/gis-for-planning-and-community-development-solving-global-challenges/149245 (accessed
16.07.2013)
13. GISC (2013). Storing GIS Data for the Web. Available at: http://giscollective.org/tutorials/web-mapping/wmsfive/ (accessed 16.07.2013)