Mar Augusthinose College, Ramapuram Department of Computer Science

Unit 1
Computer Information Systems
Information Systems Concepts
A system is a combination of resources working together to convert inputs into outputs. Inputs to a
system to be data, which are recordable facts. The outputs of a system are interpreted data, which
are called information. Thus data is the unprocessed form of information.
Business Information System
A Business Information System uses resources to convert data into information needed to
accomplish the purposes of the business. The resources may be personnel, facilities, materials, and
equipment.

A business functions with a set of constraints. The transformation of inputs into outputs is affected
by certain constraints which are external to the system. Some examples of constraints are federal
laws, social environment, total market, raw material limitations, scientific principles etc.(Figure 2.1)
Example: Retail Store system that converts sales transaction data into information needed to prepare
customer billings, manage inventory, and calculate profit and loss.
Example: A financial system helps the customers to enter personal details, making deposits, transfer
funds, withdraw cash etc.
Subsystems
Components of a system are known as subsystems. Business information systems are made up of
smaller components that are themselves systems. All the major systems are composed of
subordinate systems, or subsystems, that perform specific functions.

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Example: Marketing System contains sales and distribution subsystems. Here, an input to a sales
system is typically a sales order, and outputs include a shipping order and a customer invoice. These
“subsystems” are often referred to as “systems”.
Example: Finance System contains subsystems billing subsystem, collection subsystem, paying
subsystem
Example: Product Development System contains purchasing subsystem, receiving subsystem,
inventory subsystem, production subsystem
Example: Administration System contains personnel subsystem, contracts subsystem.

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Business System Characteristics

Business Goals and Objectives
The purposes of a business can be defined in terms of goals and objectives. A goal is a very broadly
stated purpose. Examples are the goal of making profit and the goal of educating students.
Objectives are concrete and specific accomplishments necessary to the achievement of goals. For
example, an automobile manufacturer must have as an objective the production of a competitive
product in order to achieve a profit goal; a college must as an objective relevant curricula in order to
achieve its educational goal. Major objectives are composed of lower-order objectives. Accordingly,
before a car can be made, subassemblies must be produced and, before that, proper tools must be
designed. Goals are relatively long term, and objectives are relatively short term.
Most business enterprises fall into one of two broad categories: production or service. Examples of
production enterprises are manufacturing, farming, construction, and agriculture. Service
enterprises include transportation, communications, medicine, and education. Each enterprise,
whether production or service, has its particular goals and goal -supporting objectives.

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A Business: A System of Systems

Business Systems are composed of smaller elements, which also are systems. These systems
transform or convert inputs into outputs. Principal functional systems associated with most product-
oriented enterprises are:
Purchasing, Receiving, Inventory, Production, Sales, Distribution, Billing, Collection, Paying
(Figure:2.2). Each of these functional systems produces one or more outputs in the form of products
or documents. These outputs establish the relationship of each system to other systems and to the
business as a whole.
A business may be considered to be a large system composed of smaller, operational systems. This
“system of systems” is integrated, through management and administration, to meet its objectives
and goals.(Figure 2.3). A system produces output, a business integrates the outputs of its component
systems to accomplish objectives and achieve goals. Systems are the major elements of a business
so a business can be considered as a system of systems.

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Describing the Business Organization

The Organization Chart
The owners of a business decide on the type of management and organizational structure that best
meets their goals and objectives. The owners, or their legal representatives, the board of directors,
hire managers and other employees. Each employee from the president on down occupies a position
that must be defined with respect to those of all other members of the organization. This definition
is necessary to control activities and channel the flow of information within the business
organization.
The organization chart is a flowchart that identifies the organizational elements of a business and
displays areas of responsibility and lines of authority. It is the responsibility of top management to
define and to update the organization chart. The designing of organization chart is an important
systems activity because it stimulates management to keep its organizational plan up to date.
Management has many uses for current organization charts. These include:
(1) Reviewing functions performed by major elements of the company
(2) Aligning the corporate structure with business opportunities
(3) Comparing salaries, authority, and organizational size at equivalent and subordinate levels!
Organization charts are essential to the systems analyst. In all aspects of the work system analyst
deals with individuals who have a specific position in the organization. Therefore, the analyst must
understand the organization chart - not only what is printed on it but also the personalities who are
behind it.
Superior-subordinate relationship. Most business organization charts are structured as a series of
superior-subordinate relationships. Rectangles identify positions and functions; lines and
arrowheads indicate the downward flow of authority and the upward flow of responsibility.

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Organization charts can be expanded to display linkages between successive levels. In most of the
organization there is a horizontal linkage and vertical linkage. Vertical linkages are used for superior
subordinate reporting. Positions for which both a superior and subordinate reporting relationship are
shown are called link pins. On this chart(Figure 2.6), the link pin positions are vice-presidents, the
directors, and the managers. Horizontal linkages are used to pass information to different functional
areas in the same level of an organization.

Figure 2.6
Organization chart symmetry: There are many ways of laying out symmetrical organization
charts. The three methods shown are equivalent, since the superior-subordinate relationship are the
same.

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Mar Augusthinose College, Ramapuram Department of Computer Science

Figure 2.7
There are no universal standards for the construction of organization charts. However, certain
general principles apply. Above all, it is important when considering what to put on a chart and
what to leave off to realize that the organization chart is the picture of the company seen not only by
its management and employees, but also by its general business environment. Therefore, this chart
should properly reflect to important vendors, customers, and agencies the picture the company
wishes them to see. some general guidelines for organization charts are :
1. Layout
The layout of the chart should be attractive. The picture should be made up of rectangles and lines.
It should be centered, with margins and white space selected to make the chart pleasing to the eye.
The structure of the chart should be symmetrical: As figure 2.7 illustrates, there is more than one
way of displaying equivalent relationships. In the three sections of this figure the same relationship
is shown in different ways. In all cases B, C, D, and E are at the same level and report to A. A
general guideline is to make balanced use of the space available.
2. Title and approvals
The organization chart should have a meaningful title. A standard position should be provided for
approvals, date, and other identifying information.
3. Scope
One organization chart giving an overview of the organization's main elements is required (Figure
2.8)

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4. Organization chart distribution

The overview organization chart should be distributed to top management and to all operating
officers of the business. It should be available to customers and to employees who express an
interest in the general organization of the company. Normally, new employees are provided with a
copy of the top view organization chart as part of their indoctrination. Other organization charts
should be distributed to individuals who have their responsibilities shown on the chart, to their
superiors, and to any other persons, such as systems analysts, who have a legitimate need for the
information.
5. Information provided
Each organizational rectangle on the chart should contain a title with functional significance (for
example, vice-president, information services), the name of the individual in that position, and an
identifying organization number. Figures 2.8 illustrate a typical format.

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The Organization Function List

An organization function list provides information about the major activities performed by an
organization. A separate organization function list is prepared for each element shown on an
organization chart. It is keyed to the organization chart by use of the organizational titles and
numbers shown on the organization chart.

Systems analysts who understand the organization chart and its associated function list are better
equipped to improve the efficiency of business systems for which they are responsible. Analysts can
use the organization chart as a means of increasing their knowledge of operational processes, job
responsibilities, and information flow.

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Management Uses of Information

Information System Levels
Four levels of information systems that exist in a typical business of moderate to large size. These
are (1) operational; (2) lower management; (3) middle management; and (4) top management.
(Figure 2.14)

At the operational level, routine production or clerical operations are per. formed. Operational
systems provide little feedback directly to the employee. For example, the materials clerk receives a
material requisition, fills the requisition, and files a report of action taken. A supervisor evaluates
the employee's performance. However, records of transactions occurring at the operational level
constitute data that, when collected, organized, and processed, becomes information that is the basis
for higher level management actions.

Lower management performs supervisory functions that are short term relative to the higher levels
of management. They deal with day-to-day job scheduling, checking the results of operations, and
taking the necessary corrective actions.

Middle management functions are tactical in nature. This level is responsible for allocating and
controlling the resources necessary to accomplish objectives that support the strategic goals of the
business. Planning occurs; authority is delegated to the supervisory level; and performance is
measured.

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Top management functions are strategic. They include establishment of the goals of the business,
long-range planning, new market and product development, mergers and acquisitions, and major
policy decisions. Appropriate authority is delegated to middle management.

The different uses and requirements for information at each management decision level are
summarized in figure 2.16.

1. The higher the decision level, the greater the reliance on externally generated information and the
less the reliance on internally generated information.

2. The higher the decision level, the greater the emphasis upon planning and the use of longer term
trend information.

3. The higher the decision level, the greater the necessity to ask "what if" questions as part of the
decision process.

At the higher decision levels in a company, information needs and uses are future-oriented and
depend to a greater extent upon external sources of information. This type of information is difficult
to quantify and must be coupled with the experience and judgment of the decision maker. At these
levels, computer-based information systems often are referred to as decision support systems (DSS)
because they provide information to support the particular decision processes practised by senior
managers. Increasingly, personal computers supported by productivity software, such as electronic

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spreadsheets and database managers, are adding flexibility to decision making at all managerial
levels.

Feedback and Control

Feedback and control are essential to the design of any management system. Feed back is the
process of comparing an actual output with a desired output for the purpose of improving the
performance of a system. Control is the action taken to bring the difference between an actual
output and a desired output within an acceptable range. These concepts are illustrated in figure 2.15.
Part A depicts a system in which there is no feedback and control. This system does transform an
input into an output; however, because it lacks feedback, it is called an open loop system.

From part A of figure 2.15, it is evident that the output depends solely on the characteristics of the
input and of the system. If the output is not satisfactory, there is no provision for modifying either
the input or the system. In a closed loop system, there is feedback and control. The elements of a
closed loop system are shown in part B of figure 2.15. This flowchart demonstrates that the
comparison of desired and actual outputs results in management action, which may modify the
inputs, the system, or both. The result is a modified system that will produce altered outputs. Many
operational systems are open loop systems. All true management systems are closed loop systems.

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Hardware and Software End Products

The hardware end products are described primarily by their physical, for example, electrical or
mechanical, attributes, which can be observed and measured as the hardware moves through the
several stages of its development. Examples of complex systems that have been developed by the
application of life-cycle techniques are rockets, communications networks, computer systems, and
spacecraft.
Software may be defined as a collection of programs or routines that facilitates the use of a
computer. This definition includes operating systems, which facilitate the general use of computers,
and application programs, which are written to solve specific problems. Software, in contrast with
hardware, does not possess attributes that can readily be observed and measured from concept to
end product. The software end product is information.

System Analysis and the Systems Analyst

System Analysis
System Analysis is a structured process for identifying and solving problems. Analysis implies the
process of breaking something down into its parts so that the whole may be understood. The
definition of systems analysis includes not only the process of analysis, but also that of synthesis,
which is the process of putting parts together to form a new whole.
Systems Analyst
A System analyst is an individual who performs systems analysis during any, or all, of the life-cycle
phases of a business information system. The system analyst not only analyzes business information
system problems, but also synthesizes new systems to solve those problems or to meet other
information needs. In doing so, the systems analyst works not only with computers, but also must
often manage other information resources available to a business.

The Systems Development Life-Cycle Concept

The Life-Cycle Concept
Systems are created by a dynamic process that moves through a series of stages, or phases. The
concept of a life cycle has evolved to describe the relationship between these phases. This concept
includes not only forward (in time) motion, but also the possibility of having to return, that is, cycle
back to an activity previously considered completed. This cycling back, or feedback, is an iterative
process that may occur as the result of the failure of the system to meet a performance objective or
as the result of changes in or redefinition of system objectives. Thus, we refer to the information
systems development process that follows the life cycle concept as the systems development life
cycle or SDLC.

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The Life-Cycle Activities

The Life-Cycle Flowchart (Figure 3.2)

The systems development life cycle of a computer information system can be described as an
orderly sequence of significant steps. The four major phases of SDLC are:
1. The study phase
2. The design phase
3. The development phase
4. The operation phase
All of the activities associated with each life-cycle phase must be performed, managed, and
documented. Hence, we can now define systems analysis as the performance, management, and
documentation of the activities related to the four life-cycle phases of a business information
system.

Performance of the Life-Cycle Tasks

The life-cycle method for developing complex systems is a modular, top-down procedure. In the
study phase, modules that describe the major functions to be performed by the system are
developed. The procedure is called top-down because in successive phases the major modules are

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expanded into additional, Increasingly detailed, modules. Powerful graphic tools have been
developed to structure the top-down design and development of systems.
The Study Phase

This is the phase in which a problem is identified and analyzed, alternate solutions studied, and a
system recommendation made at a general design level. The recommendation involves the
commitment of the resources needed to complete the detailed design and the development of the
computer information system.
The Design Phase
In this phase the detailed design of the system selected in the study phase is accomplished. In the
case of a computer-based business system, design phase activities include the allocation of
resources to equipment tasks, personnel tasks, and computer program tasks. In the design phase, the
technical specifications are prepared for the performance of all allocated tasks.
The Development Phase

This is the phase in which the computer-based system is constructed from the specifications
prepared in the design phase. Equipment is acquired and installed during the development phase.
Computer programs are written. All necessary procedures, manuals, software specifications, and
other documentation are completed. The staff is trained, and the complete system is tested for
operational readiness.
The Operation Phase

In this phase, the new system is installed or there is a changeover from the old system to the new
system. The new system is operated and maintained. Its performance is reviewed, and changes in it
are managed.
Management Review of the Life-Cycle Activities

Management review of the life-cycle activities may occur at any time. However, the conclusion of
each phase is a natural time for a major management review.. These are formal scheduled reviews
that must occur before a phase can be considered complete. They are essential to a structured
interaction between the systems analyst and the user, ensuring user involvement at critical decision
points. Three types of decisions can be forthcoming at each review:
(1) proceed to the next phase;
(2) cancel the project;
(3) redo certain parts of a previous phase.
Activities that are redone must be reviewed before the project can proceed to a subsequent phase.
Management review often is the mechanism that triggers "cycling back” (feedback) to an earlier
state in the life cycle, to remedy performance deficiencies, or to respond to changes in requirements.
Each successful review is a renewal of management commitment to the project.

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Documenting the Computer-Based Business Information System

The accumulation of documentation parallels the life cycle performance and management review
activities. Documentation is not a task accomplished as a "wind-up" activity; rather, it is continuous
and cumulative. The most essential documents are called baseline specifications (that is,
specifications to which changes can be referred). Baseline specification is a reference document
for system maintenance and change. There are three baseline specifications:
1. Performance specification
Completed at the conclusion of the study phase, and describing in the language of the user exactly
what the system is to do. It is a general "design to" specification.
2. Design specification
Completed at the conclusion of the design phase, and describing in the language of the programmer
how to develop the system. It is a detailed "build to" specification.
3. System specification
Completed at the conclusion of the development phase and containing all of the critical system
documentation. It is the basis for all manuals and procedures, and it is a complete "as built"
specification.
The design specification evolves from the performance specification, and the system specification
evolves from the design specification. And, since these documents are the only measurable evidence
that progress is being made toward the creation of a useful software end product, it is not possible to
manage the life-cycle process without them. Thus, documentation is not only the "visible" software
end product, but also the key to the successful management of the life cycle of computer based
business systems.

The Role of the Systems Analyst

Characteristics of Computer Information Systems
1. Accuracy
There is a greater potential for accuracy. Once the data are entered correctly into the system in a
machine-readable format, it is not necessary to reenter them. This reduces the chances for error by
reducing the number of times humans are involved.
2. Data collection and communication
Methods for collecting and communicating data are faster and more efficient, Modern computers
allow data communication networks to be established to collect data and to respond to inquiries. An
airline reservation system is an example of a network of data communication sites tied into a central
data processing center. A reservation clerk may inquire about space availability on any flight and
receive an almost immediate response. Seat reservations can be made and confirmed while the
customer waits.

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3. Data storage
Another way in which manual and human-machine systems differ is in the quantities of data that
can be stored and accessed. In computer-oriented systems, data are kept in files, in a machine-
readable format. A collection of related files forms a database. Databases allow for the centralized
storage of data, thereby eliminating the need for multiplicity of redundant files. Database systems
require special measures to prevent their contamination by bad data.
4. Speed of response
The time required for information to become available-can be greatly improved by use of
computers.
The Functions of Systems Analysis
Most of the basic functions performed by systems analysts have not changed as a result of the
changes in technology and in business information needs. These functions are:
1. To analyze business systems with problems and to design new or modified systems to solve those
problems
2. To develop business systems to meet new information or operational needs
3. To prepare and maintain manuals to communicate company policies and
procedures
4. To design the various business forms used to collect data and to distribute information
5. To perform records management, including the distribution and use of reports
6. To participate in the selection of information processing equipment and to establish standards for
equipment selection
7. To prepare and maintain business organization charts

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