Information system

An information system (IS) is a system composed of people and computers that processes or
interprets information. The term is also sometimes used in more restricted senses to refer to only the
software used to run a computerized database or to refer to only a computer system.

1 Importance
2 Evolution
3 Kinds of Information Systems
4 System development methodologies
5 Functional Information System (FIS)

1 Importance

1. To control the creation and growth of records

Despite decades of using various non-paper storage media, the amount of paper in our offices
continues to escalate. An effective records information system addresses both creation control (limits
the generation of records or copies not required to operate the business) and records retention (a
system for destroying useless records or retiring inactive records), thus stabilizing the growth of
records in all formats.

2. To reduce operating costs

Recordkeeping requires administrative dollars for filing equipment, space in offices, and staffing to
maintain an organized filing system (or to search for lost records when there is no organized
system).It costs considerably less per linear foot of records to store inactive records in a Data Records
Center versus in the office and there is an opportunity to effect some cost savings in space and
equipment, and an opportunity to utilize staff more productively - just by implementing a records
management program.

3. To improve efficiency and productivity

Time spent searching for missing or misfiled records are non-productive. A good records
management program (e.g. a document system) can help any organization upgrade its recordkeeping
systems so that information retrieval is enhanced, with corresponding improvements in office
efficiency and productivity. A well designed and operated filing system with an effective index can
facilitate retrieval and deliver information to users as quickly as they need it.

Moreover, a well-managed information system acting as a corporate asset enables organizations to

objectively evaluate their use of information and accurately lay out a roadmap for improvements
that optimize business returns.

4. To assimilate new records management technologies

A good records management program provides an organization with the capability to assimilate new
technologies and take advantage of their many benefits. Investments in new computer systems
whether this is financial, business or otherwise, don't solve filing problems unless current manual
recordkeeping or bookkeeping systems are analyzed (and occasionally, overhauled) before
automation is applied.

5. To ensure regulatory compliance

In terms of recordkeeping requirements, China is a heavily regulated country. These laws can create
major compliance problems for businesses and government agencies since they can be difficult to
locate, interpret and apply. The only way an organization can be reasonably sure that it is in full
compliance with laws and regulations is by operating a good management information system which
takes responsibility for regulatory compliance, while working closely with the local authorities.
Failure to comply with laws and regulations could result in severe fines, penalties or other legal
consequences.

6. To minimize litigation risks

Business organizations implement management information systems and programs in order to

reduce the risks associated with litigation and potential penalties. This can be equally true in
Government agencies. For example, a consistently applied records management program can reduce
the liabilities associated with document disposal by providing for their systematic, routine disposal in
the normal course of business.

7. To safeguard vital information

Every organization, public or private, needs a comprehensive program for protecting its vital records
and information from catastrophe or disaster, because every organization is vulnerable to loss.
Operated as part of a good management information system, vital records programs preserve the
integrity and confidentiality of the most important records and safeguard the vital information assets
according to a "Plan" to protect the records. This is especially the case for financial information
whereby ERP (Enterprise Resource Planning) systems are being deployed in large companies.

8. To support better management decision making

In today's business environment, the manager that has the relevant data first often wins, either by
making the decision ahead of the competition, or by making a better, more informed decision. A
good management information system can help ensure that managers and executives have the
information they need when they need it.

By implementing an enterprise-wide file organization, including indexing and retrieval capability,

managers can obtain and assemble pertinent information quickly for current decisions and future
business planning purposes. Likewise, implementing a good ERP system to take account of all the
business‘ processes both financial and operational will give an organization more advantages than
one who was operating a manual based system.

9. To preserve the corporate memory

An organization's files, records and financial data contain its institutional memory, an irreplaceable
asset that is often overlooked. Every business day, you create the records, which could become
background data for future management decisions and planning.

10. To foster professionalism in running the business

A business office with files, documents and financial data askew, stacked on top of file cabinets and
in boxes everywhere, creates a poor working environment. The perceptions of customers and the
public, and "image" and "morale" of the staff, though hard to quantify in cost-benefit terms, may be
among the best reasons to establish a good management information system.

2 Evolution

The first business application of computers (in the mid- 1950s) performed repetitive, high-volume,
transaction-computing tasks. The computers‖ crunched numbers‖ summarizing and organizing
transactions and data in the accounting, finance, and human resources areas. Such systems are
generally called transaction processing systems (TPSs).

Management Information Systems (MISs): these systems access, organize, summarize and display
information for supporting routine decision making in the functional areas.Office Automation
Systems (OASs): such as word processing systems were developed to support office and clerical
workers.
Decision Support Systems: were developed to provide computer based support for complex, non
routine decision. „ End- user computing: The use or development of information systems by the
principal users of the systems‘ outputs, such as analysts, managers, and other professionals.

Intelligent Support System (ISSs): Include expert systems which provide the stored knowledge of
experts to non experts, and a new type of intelligent system with machine- learning capabilities that
can learn from historical cases. „ Knowledge Management Systems: Support the creating, gathering,
organizing, integrating and disseminating of organizational knowledge.

Data Warehousing: A data warehouse is a database designed to support DSS, ESS and other
analytical and end-user activities. „ Mobile Computing: Information systems that support employees
who are working with customers or business partners outside the physical boundaries of their
company; can be done over wire or wireless networks.

3 Kinds of Information Systems

Organizational Hierarchy

Organizational Levels

Information Systems

Four General Kinds of IS

Operational-level systems

Support operational managers by monitoring the day-to-day‘s elementary activities and

transactions of the organization. e.g. TPS.
Knowledge-level systems

Support knowledge and data workers in designing products, distributing information, and
coping with paperwork in an organization. e.g. KWS, OAS
Management-level systems

Support the monitoring, controlling, decision-making, and administrative activities of middle

managers. e.g. MIS, DSS
Strategic-level systems

Support long-range planning activities of senior management. e.g. ESS

Executive Support Systems (ESS)

Management Information Systems (MIS)

Decision Support Systems (DSS)

Knowledge Work Systems (KWS)

Office Automation Systems (OAS)

Transaction Processing Systems (TPS)

Transaction Processing Systems (TPS)

Computerized system that performs and records the daily routine transactions necessary to conduct
the business; these systems serve the operational level of the organization

TYPE: Operational-level
INPUTS: transactions, events

PROCESSING: updating

OUTPUTS: detailed reports

USERS: operations personnel, supervisors

DECISION-MAKING: highly structured EXAMPLE: payroll, accounts payable

Office Automation Systems (OAS)

Computer system, such as word processing, electronic mail system, and scheduling system, that is
designed to increase the productivity of data workers in the office.

TYPE: Knowledge-level

INPUTS: documents, schedules

• PROCESSING: document management, scheduling, communication

• OUTPUTS: documents; schedules
• USERS: clerical workers

EXAMPLE: document imaging system

Knowledge Work Systems (KWS)

Information system that aids knowledge workers in the creation and integration of new knowledge in
the organization.

TYPE: Knowledge-level

INPUTS: design specifications

PROCESSING: modelling

OUTPUTS: designs, graphics

USERS: technical staff; professionals EXAMPLE: Engineering workstations

Decision Support Systems (DSS)

Information system at the management level of an organization that combines data and
sophisticated analytical models or data analysis tools to support semi-structured and unstructured
decision making.

TYPE: Management-level

INPUTS: low volume data

PROCESSING: simulations, analysis

OUTPUTS: decision analysis

USERS: professionals, staff managers

DECISION-MAKING: semi-structured EXAMPLE: sales region analysis

Management Information Systems (MIS)

Information system at the management level of an organization that serves the functions of
planning, controlling, and decision making by providing routine summary and exception reports.

TYPE: Management-level

INPUTS: high volume data

PROCESSING: simple models

OUTPUTS: summary reports

USERS: middle managers

DECISION-MAKING: structured to semi-structured EXAMPLE: annual budgeting

Executive Support Systems (ESS)

Information system at the strategic level of an organization that address unstructured decision
making through advanced graphics and communications.

TYPE: Strategic level

INPUTS: aggregate data; internal and external

PROCESSING: interactive

OUTPUTS: projections

USERS: senior managers

DECISION-MAKING: highly unstructured EXAMPLE: 5 year operating plan

Advantages

Chapter

Homes

Analyst

Anna University

Asset

Automation System
Business Day

Business Environment

Business Organization

Advantages

Chapter
Homes
Classification of IS by Organizational Structure
Departmental Information Systems

Enterprise Information System

Inter-organizational Systems

NYCE

SABRE or APOLLO

Classification of IS by Functional Area

The accounting information system

The finance information system

The manufacturing (operations, production) information system

The marketing information system

The human resources information system

4 System development methodologies

Introduction

A system development methodology refers to the framework that is used to structure, plan, and
control the process of developing an information system. A wide variety of such frameworks have
evolved over the years, each with its own recognized strengths and weaknesses. One system
development methodology is not necessarily suitable for use by all projects. Each of the available
methodologies is best suited to specific kinds of projects, based on various technical, organizational,
project and team considerations. CMS has considered each of the major prescribed methodologies in
context with CMS‘ business, applications, organization, and technical environments. As a result, CMS
requires the use of any of the following linear and iterative methodologies for CMS systems
development, as appropriate.

Basic Principles:

Project is divided into sequential phases, with some overlap and splashback acceptable between
phases.

Emphasis is on planning, time schedules, target dates, budgets and implementation of an entire
system at one time.

Tight control is maintained over the life of the project through the use of extensive written
documentation, as well as through formal reviews and approval/signoff by the user and information
technology management occurring at the end of most phases before beginning the

next phase. Strengths:

Ideal for supporting less experienced project teams and project managers, or project teams whose
composition fluctuates.

The orderly sequence of development steps and strict controls for ensuring the adequacy of
documentation and design reviews helps ensure the quality, reliability, and maintainability of the
developed software.
Progress of system development is measurable.

Conserves resources.

Weaknesses:

Inflexible, slow, costly and cumbersome due to significant structure and tight controls.

Project progresses forward, with only slight movement backward.

Little room for use of iteration, which can reduce manageability if used.

Depends upon early identification and specification of requirements, yet users may not be able to
clearly define what they need early in the project.

Requirements inconsistencies, missing system components, and unexpected development needs are
often discovered during design and coding.

Problems are often not discovered until system testing.

System performance cannot be tested until the system is almost fully coded, and under-capacity may
be difficult to correct.

Difficult to respond to changes. Changes that occur later in the life cycle are more costly and are thus
discouraged.

Produces excessive documentation and keeping it updated as the project progresses is time-
consuming.

Written specifications are often difficult for users to read and thoroughly appreciate.

Promotes the gap between users and developers with clear division of responsibility.

Situations where most appropriate:

Project is for development of a mainframe-based or transaction-oriented batch system.

Project is large, expensive, and complicated.

Project has clear objectives and solution.

Pressure does not exist for immediate implementation.

Project requirements can be stated unambiguously and comprehensively.

Project requirements are stable or unchanging during the system development life cycle.

User community is fully knowledgeable in the business and application.

Team members may be inexperienced.

Team composition is unstable and expected to fluctuate.

Project manager may not be fully experienced.

Resources need to be conserved.

Strict requirement exists for formal approvals at designated milestones.

Situations where least appropriate:

Large projects where the requirements are not well understood or are changing for any reasons such
as external changes, changing expectations, budget changes or rapidly changing technology.

Web Information Systems (WIS) primarily due to the pressure of implementing a WIS project quickly;
the continual evolution of the project requirements; the need for experienced, flexible team
members drawn from multiple disciplines; and the inability to make assumptions regarding the users‘
knowledge level.

Real-time systems.

Event-driven systems.

Leading-edge applications.

4.1 Prototyping

Basic Principles

Not a standalone, complete development methodology, but rather an approach to handling selected
portions of a larger, more traditional development methodology (i.e., Incremental, Spiral, or Rapid
Application Development (RAD)).

Attempts to reduce inherent project risk by breaking a project into smaller segments and providing
more ease-of-change during the development process.

User is involved throughout the process, which increases the likelihood of user acceptance of the
final implementation.

Small-scale mock-ups of the system are developed following an iterative modification process until
the prototype evolves to meet the users‘ requirements.

While most prototypes are developed with the expectation that they will be discarded, it is possible
in some cases to evolve from prototype to working system.

A basic understanding of the fundamental business problem is necessary to avoid solving the wrong
problem.

Strengths:

―Addresses the inability of many users to specify their information needs, and the difficulty of
systems analysts to understand the user‘s environment, by providing the user with a tentative system
for experimental purposes at the earliest possible time.‖ (Janson and Smith, 1985)

―Can be used to realistically model important aspects of a system during each phase of the
traditional life cycle.‖

Improves both user participation in system development and communication among project
stakeholders.

Especially useful for resolving unclear objectives; developing and validating user requirements;
experimenting with or comparing various design solutions; or investigating both performance and
the human computer interface.
Potential exists for exploiting knowledge gained in an early iteration as later iterations are developed.

Helps to easily identify confusing or difficult functions and missing functionality.

May generate specifications for a production application.

Encourages innovation and flexible designs.

Provides quick implementation of an incomplete, but functional, application.

Weaknesses:

Approval process and control is not strict.

Incomplete or inadequate problem analysis may occur whereby only the most obvious and
superficial needs will be addressed, resulting in current inefficient practices being easily built into the
new system.

Requirements may frequently change significantly.

Identification of non-functional elements is difficult to document.

Designers may prototype too quickly, without sufficient up-front user needs analysis, resulting in an
inflexible design with narrow focus that limits future system potential.

Designers may neglect documentation, resulting in insufficient justification for the final product and
inadequate records for the future.

Can lead to poorly designed systems. Unskilled designers may substitute prototyping for sound
design, which can lead to a ―quick and dirty system‖ without global consideration of the integration
of all other components. While initial software development is often built to be a

―throwaway‖, attempting to retroactively produce a solid system design can sometimes be

problematic.

Can lead to false expectations, where the customer mistakenly believes that the system is ―finished‖
when in fact it is not; the system looks good and has adequate user interfaces, but is not truly
functional.

Iterations add to project budgets and schedules, thus the added costs must be weighed against the
potential benefits. Very small projects may not be able to justify the added time and money, while
only the high-risk portions of very large, complex projects may gain benefit from prototyping.

Prototype may not have sufficient checks and balances incorporated.

Situations where most appropriate:

Project is for development of an online system requiring extensive user dialog, or for a less well-
defined expert and decision support system.

Project is large with many users, interrelationships, and functions, where project risk relating to
requirements definition needs to be reduced.

Project objectives are unclear.

Pressure exists for immediate implementation of something.

Functional requirements may change frequently and significantly.

User is not fully knowledgeable.

Team members are experienced (particularly if the prototype is not a throw-away).

Team composition is stable.

Project manager is experienced.

No need exists to absolutely minimize resource consumption.

No strict requirement exists for approvals at designated milestones.

Analysts/users appreciate the business problems involved, before they begin the project.

Innovative, flexible designs that will accommodate future changes are not critical.

Situations where least appropriate:

Mainframe-based or transaction-oriented batch systems.

Web-enabled e-business systems.

Project team composition is unstable.

Future scalability of design is critical.

Project objectives are very clear; project risk regarding requirements definition is low.

4.2 Incremental

Basic Principles

Various methods are acceptable for combining linear and iterative system development
methodologies, with the primary objective of each being to reduce inherent project risk by breaking
a project into smaller segments and providing more ease-of-change during the development process:

A series of mini-Waterfalls are performed, where all phases of the Waterfall development model are
completed for a small part of the system, before proceeding to the next increment;

OR

Overall requirements are defined before proceeding to evolutionary, mini-Waterfall development of

individual increments of the system, OR

The initial software concept, requirements analysis, and design of architecture and system core are
defined using the Waterfall approach, followed by iterative Prototyping, which culminates in
installation of the final prototype (i.e., working system).

Strengths:

Potential exists for exploiting knowledge gained in an early increment as later increments are
developed.
Moderate control is maintained over the life of the project through the use of written documentation
and the formal review and approval/signoff by the user and information technology management at
designated major milestones.

Stakeholders can be given concrete evidence of project status throughout the life cycle.

Helps to mitigate integration and architectural risks earlier in the project.

Allows delivery of a series of implementations that are gradually more complete and can go into
production more quickly as incremental releases.

Gradual implementation provides the ability to monitor the effect of incremental changes, isolate
issues and make adjustments before the organization is negatively impacted.

Weaknesses:

When utilizing a series of mini-Waterfalls for a small part of the system before moving on to the next
increment, there is usually a lack of overall consideration of the business problem and technical
requirements for the overall system.

Since some modules will be completed much earlier than others, well-defined interfaces are
required.

Difficult problems tend to be pushed to the future to demonstrate early success to

management.

Situations where most appropriate:

Large projects where requirements are not well understood or are changing due to external changes,
changing expectations, budget changes or rapidly changing technology.

Web Information Systems (WIS) and event-driven systems.

Leading-edge applications.

Situations where least appropriate:

Very small projects of very short duration.

Integration and architectural risks are very low.

Highly interactive applications where the data for the project already exists (completely or in part),
and the project largely comprises analysis or reporting of the data.

4.3 Spiral

Basic Principles:

Focus is on risk assessment and on minimizing project risk by breaking a project into smaller
segments and providing more ease-of-change during the development process, as well as providing
the opportunity to evaluate risks and weigh consideration of project continuation throughout the life
cycle.

―Each cycle involves a progression through the same sequence of steps, for each portion of the
product and for each of its levels of elaboration, from an overall concept-of-operation document
down to the coding of each individual program.‖ (Boehm, 1986)

Each trip around the spiral traverses four basic quadrants: (1) determine objectives, alternatives, and
constraints of the iteration; (2) evaluate alternatives; identify and resolve risks; (3) develop and verify
deliverables from the iteration; and (4) plan the next iteration. (Boehm, 1986 and 1988)

Begin each cycle with an identification of stakeholders and their win conditions, and end each cycle
with review and commitment. (Boehm, 2000)

Strengths:

Enhances risk avoidance.

Useful in helping to select the best methodology to follow for development of a given software
iteration, based on project risk.

Can incorporate Waterfall, Prototyping, and Incremental methodologies as special cases in the
framework, and provide guidance as to which combination of these models best fits a given software
iteration, based upon the type of project risk. For example, a project with low risk of not meeting
user requirements, but high risk of missing budget or schedule targets would essentially follow a
linear Waterfall approach for a given software iteration. Conversely, if the risk factors were reversed,
the Spiral methodology could yield an iterative Prototyping approach.

Weaknesses:

Challenging to determine the exact composition of development methodologies to use for each
iteration around the Spiral.

Highly customized to each project, and thus is quite complex, limiting reusability.

A skilled and experienced project manager is required to determine how to apply it to any given
project.

There are no established controls for moving from one cycle to another cycle. Without controls, each
cycle may generate more work for the next cycle.

There are no firm deadlines. Cycles continue with no clear termination condition, so there is an
inherent risk of not meeting budget or schedule.

Possibility exists that project ends up implemented following a Waterfall framework.

Situations where most appropriate:

Real-time or safety-critical systems.

Risk avoidance is a high priority.

Minimizing resource consumption is not an absolute priority.

Project manager is highly skilled and experienced.

Requirement exists for strong approval and documentation control.

Project might benefit from a mix of other development methodologies.

A high degree of accuracy is essential.

Implementation has priority over functionality, which can be added in later versions. Situations
where least appropriate:

Risk avoidance is a low priority.

A high degree of accuracy is not essential.

Functionality has priority over implementation.

Minimizing resource consumption is an absolute priority.

4.4 Rapid Application Development (RAD)

Basic Principles

Key objective is for fast development and delivery of a high quality system at a relatively low
investment cost.

Attempts to reduce inherent project risk by breaking a project into smaller segments and providing
more ease-of-change during the development process.

Aims to produce high quality systems quickly, primarily through the use of iterative Prototyping (at
any stage of development), active user involvement, and computerized development tools. These
tools may include Graphical User Interface (GUI) builders, Computer Aided Software Engineering
(CASE) tools, Database Management Systems (DBMS), fourth-generation programming languages,
code generators, and object-oriented techniques.

Key emphasis is on fulfilling the business need, while technological or engineering excellence is of
lesser importance.

Project control involves prioritizing development and defining delivery deadlines or ―time boxes‖. If
the project starts to slip, emphasis is on reducing requirements to fit the time box, not in increasing
the deadline.

Generally includes Joint Application Development (JAD), where users are intensely involved in system
design, either through consensus building in structured workshops, or through electronically
facilitated interaction.

Active user involvement is imperative.

Iteratively produces production software, as opposed to a throwaway prototype.

Produces documentation necessary to facilitate future development and maintenance.

Standard systems analysis and design techniques can be fitted into this framework.

Strengths:

The operational version of an application is available much earlier than with Waterfall, Incremental,
or Spiral frameworks.

Because RAD produces systems more quickly and to a business focus, this approach tends to produce
systems at a lower cost.

Engenders a greater level of commitment from stakeholders, both business and technical, than
Waterfall, Incremental, or Spiral frameworks. Users are seen as gaining more of a sense of ownership
of a system, while developers are seen as gaining more satisfaction from producing successful
systems quickly.

Concentrates on essential system elements from user viewpoint.

Provides the ability to rapidly change system design as demanded by users.

Produces a tighter fit between user requirements and system specifications.

Generally produces a dramatic savings in time, money, and human effort. Weaknesses:

More speed and lower cost may lead to lower overall system quality.

Danger of misalignment of developed system with the business due to missing information.

Project may end up with more requirements than needed (gold-plating).

Potential for feature creep where more and more features are added to the system over the

course of development.

Potential for inconsistent designs within and across systems.

Potential for violation of programming standards related to inconsistent naming conventions and
inconsistent documentation.

Difficulty with module reuse for future systems.

Potential for designed system to lack scalability.

Potential for lack of attention to later system administration needs built into system.

High cost of commitment on the part of key user personnel.

Formal reviews and audits are more difficult to implement than for a complete system.

Tendency for difficult problems to be pushed to the future to demonstrate early success to

management.

Situations where most appropriate:

Project is of small-to-medium scale and of short duration (no more than 6 man-years of development
effort).

Project scope is focused, such that the business objectives are well defined and narrow.

Application is highly interactive, has a clearly defined user group, and is not computationally
complex.

Functionality of the system is clearly visible at the user interface.

Users possess detailed knowledge of the application area.

Senior management commitment exists to ensure end-user involvement.

Requirements of the system are unknown or uncertain.

It is not possible to define requirements accurately ahead of time because the situation is new or the
system being employed is highly innovative.

Team members are skilled both socially and in terms of business.

Team composition is stable; continuity of core development team can be maintained.

Effective project control is definitely available.

Developers are skilled in the use of advanced tools.

Data for the project already exists (completely or in part), and the project largely comprises analysis
or reporting of the data.

Technical architecture is clearly defined.

Key technical components are in place and tested.

Technical requirements (e.g., response times, throughput, database sizes, etc.) are reasonable and
well within the capabilities of the technology being used. Targeted performance should be less than
70% of the published limits of the technology.

Development team is empowered to make design decisions on a day-to-day basis without the

need for consultation with their superiors, and decisions can be made by a small number of people
who are available and preferably co-located.

Situations where least appropriate:

Very large, infrastructure projects; particularly large, distributed information systems such as
corporate-wide databases.

Real-time or safety-critical systems.

Computationally complex systems, where complex and voluminous data must be analyzed, designed,
and created within the scope of the project.

Project scope is broad and the business objectives are obscure.

Applications in which the functional requirements have to be fully specified before any programs are
written.

Many people must be involved in the decisions on the project, and the decision makers are not
available on a timely basis or they are geographically dispersed.

The project team is large or there are multiple teams whose work needs to be coordinated.

When user resource and/or commitment is lacking.

There is no project champion at the required level to make things happen.

Many new technologies are to be introduced within the scope of the project, or the technical
architecture is unclear and much of the technology will be used for the first time within the project.

5 Functional Information System (FIS)

Supports a functional area by increasing its internal effectiveness and efficiency. Typically found for:
 Finance (FIN): provide internal and external professional access to stock, investment and capital
spending information.

Accounting (ACC): similar to financial MIS more related to invoicing, payroll, receivables.

Marketing (MKT): pricing, distribution, promotional, and information by customer and

salesperson.

Operations (OPS): regular reports on production, yield, quality, inventory levels. These systems
typically deal with manufacturing, sourcing, and supply chain management.

Human Resources Management (HR): employees, benefits, hiring‘s, etc.

A summary of capabilities of a FIS are organized by functional area in the following chart:

From the pyramid Each vertical section represents a functional area of the organization, and thus a
vertical view can be compared to a functional view of the organization

Information systems can be designed to support the functional areas or traditional departments

such as, accounting, finance, marketing, human resources, and manufacturing, of an organization

Such systems are classified as ‗functional information systems‘. Functional information

systems typically follow the organizational structure

Functional information systems are typically focused on increasing the efficiency of a

particular department or a functional area.

One disadvantage of functional systems is that although they may support a particular
functional area effectively, they may be incompatible to each other (NO interaction between internal
systems).

Such systems, rather than aiding organizational performance will act as inhibitors to an
organization's development and change.

Organizations have realized that in order to be agile and efficient they need to focus on
organizational processes

A process may involve more than one functional area.

Some Information Systems are cross-functional

Example: A TPS can affect several different business areas: Accounting, Human Resources,
Production, etc.

Some Information Systems concentrate on one particular business area (Accounting for
example)

These systems are:

Marketing Systems

Manufacturing Systems

Human Resource Systems

Accounting Systems

Financial Management Systems