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SUBSYSTEMS OF INFO. SYSTEM

Dr.Bharath V MFM., M.Com., Ph.D
Assistant Professor
Department of Management
Kristu Jayanti College (Autonomous)
Bengaluru

bharath.v@kristujayanti.com
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Sub-System
• Transaction Processing Systems (TPS)

• Management Information System (MIS)

• Decision Support System (DSS)

• Group Decision Support System (GDSS)

• Executive Information System (EIS)

• Expert System (ES)

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Transaction Processing Systems (TPS)

• It is an information processing system that captures and
processes every single transaction that takes place within
the organization.

• These transactions include activities involving collection,

retrieval, modification, and all other sets of activities that
trigger the retrieval of all transactions.

• A transaction processing system is highly reliable,

consistent, and efficient.

• Transaction processing systems may also be referred to

as real-time processing systems.
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Process of TPS
• 1.Batch Processing system: Transactions are
accumulated over a period of time and processed as a
single unit or batch. Ex. A stock may update its sales
records every day after the store closes.

• 2.Real-time processing system: Transaction are

processed immediately as they occur without any delay to
accurate translations. Real-time processing is also
referred to as online translation processing.
• Ex. Payroll, inventory control, order entry, accounts
payable, accounts receivable etc.
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Features of TPS
• Repository of Data

• Fast Response

• Reliability

• Authorised control

• User friendliness

• Continuous availability
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Example of TPS
• Point of sale systems

• Payroll systems

• Stock control systems

• Booking systems
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Advantage of TPS
• It is highly reliable system that managers and handles the

important transactions of an organization.

• It control, manage and observe multiple transactions.

• Used both in a real-time and batch processing manner.

• Remote functioning

• It is designed to be user friendly

• Quick recovery from any operations failure

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Disadvantages
• High initial cost of setting up

• Need to deploy many workforces

• The use of TPS lacks a standard format. ‘

• Data overloading may lead to a system crash.

• Access of services require good networking infrastructure.

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Role of TPS in Decision making

• Transaction refers to a collection of operations that form a
single logical unit of work.

• TPS produces valuable input into many other system

• It tracks routine operations but does not provide much

support for decision making.

• These system are mainly used by non-management staff

in the organization.
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Example
• An e-commerce website might use a TPS to process
credit card transactions in real-time to ensure payment
before the company starts its fulfillment process.

• A grocery checkout station is an example of a TPS, which

facilitates routine transactions, updating systems like
inventory and payment in real-time.

• TPSs are used in almost every sector where an online

transaction occurs, such as airline bookings, online
purchases in retail such as online shopping, and ticket
sales for plays, and movies.
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Case study- Hyper Active Technologies

• Hyperactive technologies has developed a system by which
cameras mounted on the roof of a fast food restaurant track
vehicles pulling into the parking lot or drive-through.
• Other cameras track the progress of customers moving through
the ordering queue. Using predictive analysis, the system
predicts what customers might order.
• In addition, a database includes historical car-ordering data,
such as 20% of cars entering the a lot will usually order at least
one cheeseburger at lunch time. Based on the camera’s input
and the database, the system predicts what customers will
order 1.5 to 5 min before they actually order. Cooks are better
informed, minimizing customers’ waiting time and the cost of
overheated food without flavour. The real-time enterprise is
also referred to as on-demand enterprise.
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Management Information System(MIS)

• As information is the based for every decision taken in the
organisation. The efficiency of management depends
upon the availability of regular and relevant information.

• An MIS collects data from various online systems to

support management decision-making, analyses the
information, and reports data.

• MIS is the use of information technology, people, and

business processes to record, store and process data to
produce information that decision makers can use to
make day to day decision”.
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MIS

Management Information System

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MIS

Senior-level
managers

Mid-level
Managers

Operational
managers
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Objectives of MIA
Data capturing

Objective of MIS Processing

Data
Storage of
Information
Retrieval of
information
Dissemination
of Information
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Features of MIS
• System approach

• Management-oriented

• Raw data from TPS

• MIS: summary and on-demand report

• Operational Management

• Long term planning

• Performance and Productivity of the Org.

• Central database

• Relevant relationship between subsystem planning

MIS Process
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Example of MIS
• Sales management system

• Budgeting system

• Human resource management system

• Marketing system
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Example
• Coca-Cola has continued to invest in information
technology, using it to help run nearly all aspects of its
business.

• McDonalds they implement MIS system which is used to

produce periodic reports such as a daily list of employees
and the hours they work, or a monthly report of expenses
as compared to a budget.
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Advantage of MIS
• Facilitating planning and timely control.

• Minimizes information overload

• Easy to access and availability

• Brings coordination

• Facilitates interpersonal communication

• MIS encourages decentralization

• Reduce cost
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Disadvantages of MIS
• Quite expensive to set up and configure

• Requires constant monitoring.

• Lack of flexibility to update itself.

• Risk of fraud

• Heavy reliance on technology

• Change in Management

• Training of employee
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Role of MIS in decision making process

• MIS helps the management at various levels and it is mean of
communication where data are collected, processed, stored and
retrieved for making decision regarding planning, operations,
and control of organisation.
• The major goal of the MIS is to provide managers with
feedback on their performance so that upper management can
keep an eye on the entire business.
• The MIS often compares "actual" data to "planned" outcomes
and results from the previous year to gauge progress toward
goals.

• MIS reduce uncertainty by providing relevant information to the

managers. It helps management to access relevant, accurate, up-
to-date information in order to take accurate decisions.
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Decision Support System (DSS)

• DSS is a computer-based information system that
supports business or organizational decision-making
activities. It is an interactive computerised system that
collects and presents data from a wide range of sources,
typically for business purpose.
<

• The information system assists the mid- and high-level

management of an organization by analyzing huge
volumes of unstructured data and accumulating
information that can help to solve problems and help in
decision-making.
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DSS
• DSS system means helping managers in decision making
process in order to achieve organizational objectives most
appropriately. DSS helps in decision-making but does
necessarily give a decision itself.

• The decision makers use information from raw data,

documents, personal knowledge, and/or business models
to identify and solve problems and make decisions.
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DSS
• Fast Computation: Perform a large number of
computations very quickly at a low cost with the help of
computer support system.
• Enhanced productivity: Improve productivity of support
staff
• Better decisions: DSS helps a decision maker in arriving
at a better decision.
• Data transmission: DSS can store and transmitted the
required data quickly and economically.
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Features of DSS
• It is used by tactical management in the org.

• DSS is computer-based information system that supports

org. decision-making activities.

• DSS takes input from TPS and MIS.

• It provide solution to problems that are unique and

change frequently

• It is intended to improve the accuracy, timeliness, quality

and overall effectiveness of a specific decision.

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Features of DSS
It is widely used in the field of business management,
agricultural production, analysing cost, verifying loan credit
and medical diagnosis.

It helps managers in interdependent or sequential decision.

DSS needs an effective database management system.

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Example
• It help diagnose a patient

• Weather forecasting

• Monitoring air traffic

• credit loan verification

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Difference between MIS and DSS

MIS DSS
MIS is usually supporting structured DSS provides support for semi-
decision, the decisions that one can structured and unstructured
easily describe in detail. decisions.
MIS uses a large volume of data as DSS uses a low volume of data as
the input and gives a summarised the input and gives a decision
report as the output. analysis as the output.
MIS is used by middle and low-level DSS is used by senior managers.
management.
The main focus is on information The main focus is on decision
processing. making support and analysis
Objective of MIS is to provide The main objective of DSS is to
information support to the provide solutions to problems that
management in the org. for decision are unique and change frequently.
making
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Advantage
• DSS improves performance and effectiveness of the user
• It speeds up the process of decision marking
• It reduces the time taken to solve problems
• It improves interpersonal communication within the
organisation
• It assists in the automation of management processes.
• It increase the control, competitiveness and capability of
innovation decision making of the organization.
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Disadvantage
• Cost of develop and implement of DSS required huge
capital investment, which makes it less accessible to
smaller org.

• Implementation of DSS can cause fear and backlash from

lower-level employees.

• Skilled employees required.

• Too much rely on technology

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• Example:

• GPS routing. GPS route planning is an example of a

typical DSS. It compares different routes, taking into
account factors such as distance, driving time and cost.
The GPS navigating system also enables users to choose
alternative routes, displaying them on a map and
providing step-by-step instructions.

• Truck uses Wheelseye to generate optimal routes and

fueling stop recommendations. Truck, managers use a
DSS called Strategic Profitability Analysis to allocate
equipment and establish pricing for customers.
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Healthcare
• Clinical decision support systems (CDSS) aid decision-
making by leveraging electronic medical records and
other clinical workflow data. This allows clinicians and
hospital staff to optimize operations and improve care
delivery to patients.

• For example, medical imaging solutions provide

physicians and radiologists with a second opinion on
disease diagnosis, improving confidence and eliminating
misdiagnosis.
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• Philips Healthcare- Clinical Decision Support Overview

Animation

• https://www.youtube.com/watch?v=pTh0IGCltvc&t=143s

•·
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Group Decision Support System (GDSS)

• It is a system that supports decision-making and has been
designed and structured in such a way so that the
members constituting a group can interact with each other
to arrive at a particular decision.

• It provides support for various group decision-making

activities such as file sharing, integration of the individual
opinions with that of the group, communication, modelling
of group actions and any other action which requires
interaction of the group members.
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Features
• Ease of Use: It consists of an interactive interface that
makes working with GDSS simple and easy.
• Better Decision Making: It provides the conference
room setting and various software tools that facilitate
users at different locations to make decisions as a group
resulting in better decisions.
• Emphasis on Semi-structured and Unstructured
Decisions: It provides important information that
assists middle and higher-level management in making
semi-structured and unstructured decisions.
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Features
• Supports all Phases of the Decision Making: It can
support all the four phases of decision making, viz
intelligence, design, choice, and implementation.
• Supports Positive Group Behaviour: In a group
meeting, as participants can share their ideas more
openly without the fear of being criticized, they display
more positive group behaviour towards the subject
matter of the meeting.
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Process of GDSS
Problem
Identification

System setup

Participant input

Information
sharing

Decision making

Feedback and
Evaluation
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Components of GDSS
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Example
• Videoconferencing- making it possible for multiple
participants to see and talk to each other in real-time-Google
meeting, zoom

• Group Scheduling- allowing participants to share schedules

and plan joint activities- hubspot meeting, once hub.

• Project management software- providing a way to plan for

and keep track of group activities-teamwork, adobe workfront.

• Collaborative electronic workspace- making it possible for

participants to work on the same documents. Google
Workspace, Microsoft Teams, and Slack
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Advantages
• More Information in Less Time: It is possible to gather huge
amount of information in a very short time period as GDSS
facilitates the members of the team to work parallel.
• Greater Participation: The risks associated with conformity
pressure and groupthink is greatly decreased when the
members of the group work in a GDSS because the members
can express their thoughts freely.
• More Structure: In a GDSS environment the discussions are
much more concentrated and focused. Irrelevant discussion
are greatly reduced.
• Automated Documentation: Comments are preserved
forever and the system provides the result without any delay.
Excellent graphics makes viewing more attractive.
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Disadvantages
• Cost: A significant amount of cost may be associated
with putting up the infrastructure consisting of the room,
network connectivity and the software.

• Security: There are chances that information gets

leaked to the peers by a low-level employee.

• Technical Failure: The system must be properly

implemented to reduce the risk associated with loss of
connectivity and power loss. It is highly dependent
on LAN/WAN infrastructure and bandwidth.
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Executive Information System (EIS)

• An EIS, also known as executive support system, is a
type of management support system that facilitates and
supports senior executive information and decision-
making needs.

• An executive information system (EIS) is a decision

support system (DSS) used to assist senior executives in
the decision-making process.

• It providing easy access to important data needed to

achieve strategic goals in an organization. An EIS
normally features graphical displays on an easy-to-use
interface.
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Features of Executive Information System (EIS)

• EIS provides key information, gathered from both internal

and external sources, to senior executives and managers.

• The objectives of EIS to highlight information to satisfy

senior executives needs and not for the entire company.

• It Present graphical, tabular and textural information.

• Designed with mgt. critical success factors in mind.

• Personalized analysis
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Advantages of EIS
• Ability to analyse trends.

• EIS provides timely delivery of information. Mgt. can

make decisions promptly.
• It enhance org. competitiveness in the market place.

• The main benefit of EIS is the improvement in

financial and operational control.

• EIS filters the information for management and

delivery of summary information about the
company at a particular time.
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Disadvantage
• System dependent.

• High implementation costs.

• EIS are restricted and can’t perform complex calculations.

• Executives may experience an overload of data

• EIS is that it is so simple such that it can be used by everybody

because of its technical functions.

• Extra expenses are required for small business associations to

use EIS. EIS may become slow in speed and become difficult
to manage.
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Expert System
• An expert system is a computer program that uses
artificial intelligence (AI) technologies to simulate the
judgment and behaviour of a human or an organization
that has expertise and experience in a particular field.

• An expert system (knowledge-based system) is a

computer program designed to act as an expert in a
particular domain.
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Features of Expert system

• It provides high performance for solving any type of
complex problem of a specific domain with high efficiency
and accuracy.
• Expert system are very domain specific.
• It responds in a way that can be easily understandable by
the user.
• It takes input from human and provides the output in the
same way.
• One expert system may contain knowledge from more
than one human expert thus making the solution more
efficient.
• It decrease the cost of consulting an expert for various
domains such as medical reports.
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Advantages
• Accuracy. Expert systems are not prone to human error or
emotional influence. They make decisions based on defined
rules and facts.
• Permanence. Human experts eventually leave their role, and
a lot of specific knowledge may go with them. Knowledge-
based systems provide a permanent repository for knowledge
and information.
• Logical deduction. Expert systems draw conclusions from
existing facts using various types of rules, such as if-then
rules.
• Cost control. Expert systems are relatively inexpensive
compared to the cost of employing human experts. They can
help reach decisions more efficiently, which saves time and
cuts costs.
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Disadvantage of Expert System

• The response of the expert system may get wrong if the
knowledge base contains the wrong information.

• High development costs. Large expert systems are costly,

require significant development time and computer
resources.

• It needs to be updated manually, it does not learn itself.

• Lack of emotion in some cases -- medical diagnoses, for

example -- human emotion is useful and necessary.
 Comparing Subsystems
TPS MIS DSS GDSS EIS ES
Application Efficient Standardised Analysing Processing Data Decision
Focus processing of data large data to solve presentation for making
large volume of summarizing volume of unstructured environmental through
standardized and reporting data to problems by analysis and specialized
transactions improve teams decision making knowledge
decision and ability
making

Data Focus Internal Data Internal Data Internal Internal Data Internal and Internal and
Data External External
Information Information

Type of User Operational Managers at all Managers at Members of Senior Professionals

personnel levels Middle and a group or Executives at top and Subject
Top level team level experts
 Comparing Subsystems
TPS MIS DSS GDSS EIS ES
Data Accuracy of Consistency Accuracy Data Integration of Solving
processing repetitive of of internal integration multiple structured
objectives data interpretation and for sources problems
external decision
informatio making
n
User and Operational Managers Middle Teams or Executives Computer
his IS personnel receive and top- groups retrieve the enables
related enter standard level gather information professional
tasks transactions reports managers data for from various s to use
and receive decision sources data
manipulate the making
data informatio
n
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Office Automation System (OAS)

• Office automation is a necessity for modern offices. The
word ‘office automation denotes replacement of manual
office operations by machine.

• Office automation is the use of computer system to

execute a variety office operations, such as work
processing, electronic filing, accounting, and email.

• Office automation system (OAS) is software system

typically used to create, collect, store, transmit, and
digitally manipulate the office information needed to
accomplish the desired the task.
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Advantages
• It eliminates the need for a large staff.

• It reduce the storage space.

• It handles large volume of work in a better manner with

greater accuracy and speed.
• It increase the productivity of an organization

• It facilitates better communication

• It reduce the operational cost

• Paperless office
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Disadvantage
• OAS are quite expensive.

• Required skilled employee,

• Security problems

• Total rely on technology