UNIT-2

INFORMATION SYSTEM
DATA PROCESSING
The activity of processing data using a computer is called
Data Processing or Electronic Data Processing (EDP).
i.e in Data Processing Data is converted into Information.
DATA
Data is a raw material used as input and information is numbers Symbols words
processed data obtained as output of data processing.
INPUT
Input refers to the data and instructions given to the
Data
computer.
Data is a raw set of facts and figures associated with an
individual, an entity, or an event. Data is also called as a
collection of unorganized facts or concepts that does not images videos sounds
convey any meaning. Data can be represented in various
forms i.e in figures, characters, symbols, pictures, audio
video etc.
Some examples of data are phone numbers, weights, prices
etc.
Instruction specifies how the data is to be manipulated. It is basically a command given to
computer to carry out particular operation on the data
Example 2+3, here 2,3 data + is instruction
PROCESS
It is the interpretation and execution of the instruction on data, which is carried out by the
computers processing unit to obtain the required result.
Example 2+3-4
2, 3,4 is data , 2+3 sum subtracting 4 is process
OUTPUT
The result obtained from the process is called as an output.
2+3-4=1 is the output
INFORMATION
Meaningful output is called information.
The average performance of a class is derived as an output from the process of summing
up all the marks of the class, dividing it by the number of students. This information is
useful to the class teacher.
KNOWLEDGE
Knowledge is what we know about a particular domain (field).it is usually based on
learning, thinking and proper understanding of the problem area. Knowledge is
derived from information in the same way as information is derived from data. It
refers to the use of information to make decisions.
Let us clear the difference between data, information and knowledge with an
example.

DATA: 30000, 7000, 18000, 9000

INFORMATION: Here is a price list of Nokia Mobile Phones:
Knowledge: I only have Rs. 7000 to spend and can only afford the Nokia C5.
NOKIA LUMIA 920 30000
NOKIA C5 7000
NOKIA N8 18000
NOKIA E5 9000
Data Vs Information
DATA INFORMATION
Data is raw fact and figures. Information is a processed form of Data
For example 32 is data For Example: Age 32
Data is not significant to a business Information is significant to a business
Data are atomic level pieces of information. It Information is a collection of dat. For example:
can be in the form of numbers, characters, Age and 32 collected together to form
symbols or even pictures information Age
Data does not help in Decision Making Information helps in decision making
Observations and recordings are done to Analysis is done to obtain information.
obtain data
Input to any system may be treated as data Output after processing the system is
information
Difficult to understand Easy to understand
Data must be processed to understand Information is understandable
Data may not be in order Information should be in order
SYSTEM
“ A system can be defined as an organized combination of
interdependent functioning units or components that are
linked together in order to achieve a specific objective. “
A system maybe seen has a set of subsystems each subsystem
as its well defined specific all the subsystems work in co-
ordinate overall objective of the system.
Every system must be designed to work towards a
predefined objective
All subsystems in a system must be interrelated and
interdependent
The objective of a system has a higher priority over or
objectives of its subsystem .
Characteristics of system
The Main or salient features of a System are
Organization
It implies a structure of components and order in which they are linked.
For example, structure of computer system consists of input device or output device
storage device and CPU. They are linked together in order to work as a whole system for
producing information.
A proper organization define system, subsystem relationship, hierarchical relationship,
flow of communication among subsystems and authorities structures.
Interaction
It defines the way in which each subsystem interact with other subsystem of the system. It
also define that how the changes made to one subsystem may impact the other subsystem
in a system.
All the subsystem need to have some interaction among them in order to work together.
For example marketing must interact with sales, purchasing with production , HR with
employees and payroll with personal in organization.
Interdependence
It refers to dependence of one subsystem on other subsystem in a system. All
components in a system must be interrelated and interdependent. One component
depends upon the outcome of another component.
For example, an advertising and marketing of a product is critical to the sale of that
product.
Integration
It refers to the mixture of subsystem within the system to work together. Although
all subsystems performs a unique pre-determined objective, but they are tied
together to achieve the central objective. The successful integration of Subsystem
produces synergistic or collective benefits to the system.
Central objective
The central objective of the system must be well stated. Although a subsystem has
stated objective, but the objective of system has higher priority over objectives of its
subsystem. Thus all the subsystem must work together to achieve that Central
objective.
Characteristics of System
Following characteristics are present in all systems :
a) Organization b) Interaction c) Interdependence d) Integration e) Central Objective
a. Organization : Organization implies structure and order. It is the arrangement of components that helps
to achieve objectives. Hierarchical relationship starting with the president on top and leading down ward to
the blue collar worker represent the organization structure
b. Interaction : Interaction refers to the procedure in which each component interact with other
components of the system. In an organization, for example purchasing must interact with
product, advertising with sales and payroll with personnel.
c. Interdependence : Independence is concerned with how a system is tied together; it is more than
sharing a physical part or location. It means that parts of the system part or location with in the system,
even through each part performance. A unique function successful integration will typically produce a
better request as whole rather than if each component works independently.
d. Central Objective : Objective may be real or stated. Objective is determined by higher
management and user must be aware about the central objective well in advance. 
Information system IS
Information system refers to a Computer Based system that provides
information to the management of an organization which will enable them to
make decisions. In simple terms an information system helps management in
decision making.
Businesses make use of information system so that accurate and up to date
information will be available when it is required. Since it is not always possible
to predict what information will be needed at some future date, most
organizations use computers to record and store the details of all their business
transactions.
When a query arises or a standard business report must be produced, this raw
data can be retrieved and manipulated to produce the required information.
Characteristics of information system
The basic characteristics of an information system are
1.The business aspects are more important than the technological issues in
IS.
2.Information system must serve a purpose.
3.Every IS required support from staff which manage and run the
information
4. system.
5.Information systems are connected by means of electronic networks.
6.It is composed of several separate information systems.
7.It organizes data into information.
 8. It supports analysis of information to give knowledge.
9. It collect, store, modify and retrieve the daily transactions of an
Organization.
10. Assists people to make decisions for providing information
models and analysis tool.
11. It provides information and solve problems in various fields
such as diagnosing, monitoring, selecting, designing,
predicting
and training.
Business information system BIS
A business information system can be defined as a group of interrelated
components that work collectively to carry out input, processing, output, storage
and control actions in order to convert data into information products that can be
used to support forecasting, planning, control, coordination, decision making and
operational activities in an organization.
In terms of the components that undertake this activity they can be classified into
following five basic resources.
1. People 2. Hardware 3. Software
4. Communication 5. Data
1. People
People resources include the users, developers of an information system and the
persons who operate and maintain the system such as managers and Technical
Support staff.
2. Hardware
Hardware resources in two computers and other items such as printers, scanners
etc.
3. Software
Software resources refer to computer programs known as software and
associated instruction manuals.
4. Communication
Communication resources include networks and the hardware and software
needed to support them
5. Data
Data resources cover the data that an organisation has access to such as
completed it a basis and paper files.
Components Of Information System
An Information system is a combination of
hardware and software and telecommunication
networks that people build to collect, create
and distribute useful data, typically in an
organizational, It defines the flow of
information within the system. The objective
of an information system is to provide
appropriate information to the user, to gather
the data, processing of the data and
communicate information to the user of the
system.
Components of the information system are as follows:
1. Computer Hardware:
Physical equipment used for input, output and processing. What hardware to use is
depends upon the type and size of the organization. It consists of input, an output
device, operating system, processor, and media devices.
2. Computer Software:
The programs/ application program used to control and coordinate the hardware
components. It is used for analyzing and processing of the data. These programs
include a set of instruction used for processing information.
Software is further classified into 2 types:
•  System Software
• Application Software
3. Database:
Data are the raw facts and figures that are unorganised and later processed to
generate information. Softwares are used for organising and serving data to the
user, managing physical storage of media and virtual resources. As the
hardware can’t work without software the same as software needs data for
processing. Data are managed using Database management system.
Database software is used for efficient access for required data, and to
manage knowledge bases. Therefore, A database is a place where data is
collected and from which it can be retrieved by querying it using one or more
specific criteria.
5. Human Resources:
It is associated with the manpower required to run and manage the system.
People are the end user of the information system, end-user use information
produced for their own purpose, the main purpose of the information system is
to benefit the end user. The end user can be accountants, engineers, salespersons,
customers, clerks, or managers etc. People are also responsible to develop and
operate information systems. They include systems analysts, computer
operators, programmers, and other clerical IS personnel, and managerial
techniques.
Types of information system
A common approach to examining the types of information system used within
organizations, used to categorize information system(IS) applications by the roles
they play at various levels in the organizational structure. This is known as a
vertical approach.
In this case the organization is viewed as a management pyramid with four levels
•At the lowest level, non management staff daily business transactions such as
selling goods and issuing receipts for payment
•Operational management is responsible for monitoring the transactions that
are occurring and dealing with any problems that may arise.
 •Practical management decides on budget, set targets, identify trends and
develop short term plans for the business.
•At the top level of the pyramid, strategic management is responsible for
defining the long term goals and how it intends to position itself within its
particular industry.
These levels of Management generate four different types of information
systems.
1. Transaction processing system
2. Management information system
3. Decision support system
4. Executive information system
Levels of Management

Strategic EIS
Management

Tactical DSS
Management
MIS
Operations Management

TPS
Non-Management Staff
1. Transaction processing system
At the lowest level of the organizational hierarchy we find the
transaction processing system that supports the day to day activities.
These systems are mainly used by clerical staff in the organization to
perform regular business activities such as invoicing and issuing of
stock.
For Example, the itemized bill slip from a Supermarket is produced by
the transaction processing system and details of each individual item
sold will be recorded in the source database.
2. Management information system
The next level in the organizational hierarchy is occupied by Low level managers
and supervisors. This level contains computer systems that are intended to assist
operation management in monitoring and controlling the transaction processing
activities. Management information system use the data collected by the TPS to
provide supervisor's with the necessary control reports.
Many different types of report are produced in MIS. Some of the reports are a
summary report, on-demand report, ad-hoc reports and an exception report.
Example: Sales management systems, Human resource management system.
3. Decision support system
Tactical management occupies the next level in the
organizational hierarchy. These managers are responsible for
ensuring that plans and targets set by senior management are
achieved. They tend to focus not on the progress of individual
transactions but on the bigger picture.
4. Executive information system
The highest level in the organizational structure is that of strategic
management, and once again its information requirements are unique these
managers are charged with the task of setting the strategy for the
organization. Require an information system that will enable them to
identify problems, opportunity trends that may help their organizations
competitive position.