03 Introduction to Computer System (Why IT is being used?)

Chapter 3

Why IT is being used?

You can’t think about a world with out IT today. IT has become part and participle with 

everybody’s life today. There are thousands of reasons about why people use computers to fulfill their 

requirements in many life aspects.

Basically we can have Information Systems which is a major part in IT.

Types Of Information Systems

An information system is a set of hardware, software, data, people, and procedures that work 

together to produce information. A procedure is an instruction, or set of instructions, a user follows to 

accomplish an activity. An information system supports daily, short- term, and long -range activities of 

users in a company. Information systems generally fall into one of five categories: office information 

systems, transaction processing systems, management information systems, decision support systems, 

and expert systems. The following sections present each type of information system.

Types Of Information Systems

An information system is a set of hardware, software, data, people, and procedures that work 
together to produce information. A procedure is an instruction, or set of instructions, a user follows to 
accomplish an activity. An information system supports daily, short- term, and long -range activities of 
users in a company. Information systems generally fall into one of five categories: office information 
systems, transaction processing systems, management information systems, decision support systems, 
and expert systems. The following sections present each type of information system.

01. Office Information Systems

An office information system (OIS pronounced oh-eye -ess) increases employee productivity and 
assists with communications among employees. In an OIS, employees perform tasks using computers 
and other electronic devices, instead of manually. Some people describe an OIS as office automation.
Just about every type of business or organization uses some form of OIS. For example, a school 
might post its class schedules on the Internet. When the school updates the schedule, students receive 
an e-mail notification. In a manual system, the school would photocopy the schedule and mail it to each 
student’s house.
An OTS supports many office activities. With an OIS, you can create and distribute graphics and 
documents, send messages, schedule appointments, browse the Web, and publish Web pages. All 

levels of users utilize and benefit from the features of an OIS.
An OIS uses many common soft ware products to support its activities. Typical software in an OIS 
includes word processing, spread sheet, database, presentation graphics, e -mail, Web browser, Web 
page authoring, personal information management, and groupware. To send text, graphics, audio, and 
video to others, an OIS uses communications technology such as voice mail, fax, videoconferencing, 
and electronic data interchange (EDI).
In an OIS, computers have modems, video cameras, speakers, and microphones. Scanners, fax 
machines, digital cameras, and Web - enabled devices such as cellular telephones are other types of 

hardware often found in an OIS.

02. Transaction Processing Systems

A transaction processin g system (TPS) captures and processes data from day-to-day business 
activities. When you use an automated teller machine to withdraw cash, you are using a TPS. Examples 
of transactions are deposits, payments, orders, and reservations. In a company, clerical staff typically 
perform the activities associated with a TPS, which include the following:
1. Recording a business activity such as a student’s registration, a customer’s order, an employee’s 
time card, or a car owner’s payment
2. Confirming an action or causing a response, such as printing a student’s schedule, sending a 
thank-you note to a customer, printing an employee’s paycheck, or issuing a receipt to a car owner.
3. Maintaining data, which involves adding new data, changing exist ing data, or removing unwanted 
data
Transaction processing systems were among the first computerized systems that processed 
business data. Many people initially referred to the functions of a TPS as data processing. The first 
TPSs computerized an existing manual system. The intent of these TPSs was to process faster, reduce 
clerical costs, and improve customer service.
The first TPSs mostly used batch processing. With batch processing, the computer collects data 
over time and processes all transactions later, as a group. As computers became more powerful, 
system developers created online transaction processing systems. With online transaction processing 
(OLTP), the computer processes each transaction as it is entered.
When you register for classes, your school probably uses OLTP. The registration clerk enters your 
desired schedule. The computer immediately prints your statement of classes. The invoices often are 
printed using batch processing. That is, the computer prints and mails all student invoices at a later 
date. Today, most transaction processing systems use OLTP. For some routine processing tasks, they 
also use batch processing. Many organizations use batch processing to calculate paychecks and print 

invoices.

03. Management Information Systems

A management information system (MIS pronounced em-eye ess) generates accurate, timely, 

and organized information, so managers and other users can make decisions, solve problems, 

supervise activities, and track progress. Management information systems evolved from transaction 

processing systems. Managers realized the computer had more potential than just supporting a TPS. Its 

capability of quick computing and data comparisons could pro duce meaningful information for 

managers.

MISs often are integrated with transaction processing systems. To process a sales order, the TPS 

records the sale, updates the customer’s account balance, and reduces the inventory count. Using this 

information, the related MIS can produce reports that recap daily sales activities; summarize weekly and 

monthly sales activities; list customers with past due account balances; graph slow- or fast-selling

products; and highlight inventory items that need reordering. An MIS focuses on creating 

information that managers and other users need to perform their jobs.

An MIS creates three basic types of information: detailed, summary, and exception. A detailed 

report usually lists just transactions. For example, a Detailed Order Report lists orders taken during a 

given period. A summary report consolidates data, so you can review it quickly and easily. A summary 

report usually has totals, tables, or graphs.

An exception report identifies data outside of a normal condition. These conditions, called the 

exception criteria, define the1 activity or status range. For example, an Inventory Exception report 

notifies the purchasing department of items it needs to reorder.

Exception reports save managers time. Instead of searching through a detailed report, managers 

simply review the exception report. These reports help managers focus on situations that require 

immediate decisions or actions.

04. Decision Support Systems

A decision support system (DSS) helps you analyze data and make decisions. Often, a TPS or 

MIS does not generate the type of report a manager needs to make a decision. Different managers 

need various types of information. A marketing manager might need to know how much he or she has 

spent on Internet advertising in the past three months. Whereas an office manager might need to know 

how many pads of paper were used.

A variety of DSSs exist. Some are company specific and used by managers. Others are available 

to everyone on the Web. Programs that analyze data, such as those in a DSS, sometimes are called 

online analytical processing (OLAP) applications. Because they summarize information, these 

applications process many records at a time. This is different from OLTP applications, which process 

individual records at one time and typically use relational databases.

Some OLAP applications are called MOLAP because they use multidimensional databases. 

Those that use relational databases are known as ROLAP. Others blend the two database types. These 

hybrid OLAPs may use a ROLAP as the back end and a MOLAP as the front end.

A DSS uses data from internal and external sources. Internal sources of data might include sales, 

manufacturing, inventory, or financial data from a company’s database. Data from external sources 

could include interest rates, population trends, costs of new housing construction, or raw material 

pricing.

Some DSSs have their own query languages, statistical analysis, spreadsheets, and graphics that 

help you retrieve data and analyze the results. Some also allow you to create a model of the factors 

affecting a decision. A product manager might need to decide on a price for a new product. A simple 

model for finding the best price would include factors for the expected sales volume at various price 

levels. The model allows you to ask what-if questions and view the expected results. Instead of buying a 

DSS, many people use their application software to perform DSS functions. With Microsoft Excel, for 

example, you can model data and create what-if scenarios.

05. Expert Systems

An expert system captures and stores the knowledge of human experts and then imitates human 

reasoning and decision making. Expert systems consist of two main components: a knowledge base 

and inference rules. A knowledge base is the combined subject knowledge and experiences of the 

human experts. The inference rules are a set of logical judgments that are applied to the knowledge 

base each time a user describes a situation to the expert system. Expert systems help all levels of 

users make decisions. Non management employees use them to help with job-related decisions. Expert 

systems also successfully have resolved such diverse problems as diagnosing illnesses, searching for 

oil, and making soup.

These are only few examples but with the time the importance of IT will grow. No matter in which 

field you are but IT will be a compulsory for everybody