Management
Operational data
Selection
Summary and
Control
Information
Summarisation
Exception reports
System
Reconciliation
Tactical
Decision
Operational data
Simulation
Ad hoc reports
Support
& Decision
Analysis
System
models
Strategic
Executive
Internal and
Summarisation
Critical Success
Information
External data
Drill down
Indices
System
Figure 1-2: Characteristics of each level of management support
1.2 Office Automation Systems (OAS)
Other types of information systems are not specific to any one level in the organisation but provide important support for a broad range of users. Many standard computer applications, such as word processing, spreadsheeting, data management, and presentation graphics are
used across all management levels of the organisation. Apart from their individual
capabilities, many of these programs are able to exchange information, so that for example a word processing document may include a graph developed using a spreadsheet program,
which is dynamically updated when the data in the spreadsheet is changed.
Word processing software is used to create and maintain electronic documents. Because word processors create virtual (electronic) documents as opposed to physical ones, any errors or alterations can be made to the document before it is printed. This simple concept has empowered all the one and two fingered typists of the world and made the professional typist an endangered species. More than 90% of all white collar workers in the USA now use a word processor to perform their jobs; however, as personal computers and word processing
packages become more powerful, so users continually need to update their skills to get to grips with the next generation of software.
Spreadsheets are to numbers what the word processor is to text. They allow for easy preparation of financial statements, cash flows, budgets and other problems requiring
quantitative analysis. The beauty of the electronic spreadsheet is that it mirrors the way we performed the task manually, except that users enter data via a keyboard and view it on a computer screen rather than writing on to paper. This similarity ensures users understand and become proficient in the use of spreadsheet packages in a very short period of time. Because of their ability to use formulas and functions to recalculate answers when values are changed, spreadsheets are excellent tools for performing “what if” analysis. Today’s spreadsheet packages also offer a variety of statistical and business analysis tools, together with the ability to generate business charts directly from the spreadsheet data.
Data management software is used to create and maintain records about items such as Discovering Information Systems
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customers, stock or employees, which are vital to the operation of any business. The main advantage of automation when applied to organisational record-keeping, is the power of the computer to select, sequence, summarise and report on data once it has been captured. In addition, data management software incorporates error-checking features, which could ensure for example that only valid account numbers may be entered in a transaction, and
sophisticated backup and retrieval methods. Traditionally, data management has been
regarded as the most difficult of the office automation applications, and is used mainly by those with specialised skills. There are, however, a number of simple data management
facilities in most word processing and spreadsheet packages, such as the ability of word processing programs to perform mail merges in which a standard letter is merged with
personal information from a database.
Presentation graphics software provides an easy means of generating high quality
presentation materials based on colour overheads, slides or large screen displays. The latest versions include advanced slide show facilities together with animation and sound clips. This has become a popular tool for marketing, executive reporting, training and seminars.
1.3 Groupware
Most office automation applications are designed for standalone users although the data and information can be shared through the use of networks and e-mail. However, much of the
work performed in business today is cooperative with individuals working together in groups to achieve common goals. Groupware is the term given to software developed to support the collaborative activities of work groups, with typical requirements being information sharing, electronic meetings, scheduling and e-mail.
Groups are often informal and could include members of a project team, employees within a department, or individuals with a common interest. Normally an individual is included in a number of groups, each with a specific focus. For example a lecturer in the accounting
department would probably be included in the staff group (university wide), accounting
department group, lecturers group (university wide), accounting lecturers group, Accounting II group (which he co-ordinates), accounting research group (international) and so on. Mail and discussions can be focused by means of a particular group name which addresses all its members. As long as the groups are kept up to date as members change careers and interests, addressing 2,500 co-workers can be as easy as addressing a single individual.
Apart from the obvious e-mail communication, there are a number of other group activities supported by current software.
Where individuals are encouraged to maintain an electronic calendar detailing their appointments and availability, groupware can search through the calendars to find times when all members of a group are available (for example when a staff meeting needs to be
scheduled) and makes the required entry in each individual’s diary.
The use of compound documents makes it easier to circulate files among the members of a group and keep track of changes that are made. Many office products allow some integration of files from a number of different systems, so that part of a spreadsheet for example can be 6 [Free reproduction for educational use granted]
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embedded in a word processing document. However some groupware products (such as Lotus
Notes) go further and create a database for each communication where any combination of
documents can be combined for distribution around the group. Another useful feature of
groupware documents is the ability to control group editing and update, by allowing
colleagues to attach comments to the document without altering the original text. In addition, in cases where criticism is required and even encouraged, the system can also allow for the group input to be anonymous.
Project management software provides graphical tools to help manage projects by
sequencing tasks, allocating and scheduling resources and reporting on project progress. Files can be checked in and out by members of the project team, changes are tracked using version control, and project managers can use “what if” queries to assess the impact of changes in the use of resources or time.
Electronic meeting software is designed to support interaction between members of a distributed group, without the cost and time wasted through travelling to a physical
destination. Here groups can log into an electronic meeting from their offices or in special purpose electronic meeting rooms. While the meeting can be conducted by typed
communications between the recipients, voice and even video communication can also be
included. Apart from providing the means of communication, groupware can also store the
output of such sessions in electronic format to assist with documentation and analysis of the group input. In the past, video-conferencing facilities were expensive but today multimedia upgrades can be installed on local machines at low cost. The one bottleneck to this groupware functionality is the quality of communications between the participants as video
communication requires relatively large volumes of data to be exchanged.
Electronic mail, commonly referred to as e-mail, can be defined as the electronic exchange of messages between users. Where a user has the required software and links to the internet (for mail dispatched to remote locations), he or she can enter a message into the computer and transmit it to the recipient’s Internet address. The message is then transferred across the network and stored on the network server in the recipient’s mailbox from where it can be retrieved. E-mail facilities allow users the ability to print out messages, forward them to third parties and store mail in appropriate folders for future reference. In addition e-mail has a number of advantages over the traditional “snail mail” system. Mail can travel to anyone connected to the Internet in a very short time. It is simple to set up mail groups so that a number of individuals can communicate about common issues. Files can be attached to e-mail transmissions, so any material in electronic form can be communicated across the internet.
E-mail is also useful for inter-office communication. Often colleagues are busy or unavailable when you need to pass on information or discuss a problem. Leaving an e-mail message in the appropriate mailbox will achieve the required communication without the irritation and stress of attempting to make verbal or face to face contact. Nevertheless, e-mail communications do have their limitations. For those who type slowly, entering a long communication can be an arduous task. In addition e-mail is not as confidential as most users would like, since
organisations may monitor and even open their employees personal e-mail documents.
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1.4 South African Perspective
Automation of data capture and business processes can lead to improved management
information, employee empowerment and customer satisfaction.
• By redesigning their processes for extracting customer data and printing TV licence
statements, the SABC has cut their statement production time from 15 to 7 days,
resulting in reduced costs and faster revenue collection.
• Spur Steak Ranches recently commissioned a new Human Resource system that will
allow staff to check their leave balances and apply for leave on-line.
• And ABSA Bank will soon be building a new call centre in Auckland Park, which
will use sophisticated IT to enable advisors to deal with multiple queries from the
same customer, and allow supervisors to design duty rosters based on trends in service
demands.
However, a word of warning comes from Arthur Goldstuck, commenting on the South
African Government’s plan to adopt an IT system that will provide a single gateway to all state information and services, including a toll-free information centre operating in all 11
official languages (Intelligence magazine, November 2002). Goldstuck points out that
existing services are inadequate at most government outlets, such as Home Affairs, the
Labour Department and the Welfare Department. Investing in technology is not likely to
make a significant improvement to customer service, unless at the same time the attitudes of staff can also be changed. “If an organisation’s workers regard the people they serve as annoyances, they will keep treating them as annoyances, regardless of the systems that are put in place.” His conclusion: if you want to use technology to streamline a process, first make sure that the process works.
1.5 Beyond the Basics
All too often, information systems are developed in order to automate existing business
processes. But what happens if those existing processes are inefficient? Increased processing speed may simply increase the rate at which problems occur. This is where the concept of business process reengineering (BPR) enters the picture. BPR involves the fundamental redesign of an organisation’s business activities, in order to achieve dramatic improvements in quality, cost and speed. This is a major undertaking, which must be carefully managed to avoid employee resistance, since it often involves restructuring of the entire organisation.
However, the benefits of BPR can be enormous. For example, IBM Credit Corporation
reduced the turnaround time for approving credit orders from seven days to four hours by reengineering the credit approval process so that it could be handled by a single employee using a decision support system instead of forwarding the credit application through four different departments.
Trivial fact: T J Watson, the founder of IBM, was once asked how many computers he
expected to sell worldwide, and his answer was 5. There are now over 34 million desktop computers sold worldwide every year!
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1.6 Exercises
1.6.1 Organisational Information Systems
Consider the example of a large supermarket chain such as Pick ‘n Pay.
• Identify a typical activity that would be recorded using the Transaction Processing
System. How often would such an activity occur, and what member of staff would be
responsible for recording it ?
• Operational management is responsible for monitoring routine daily activities.
Suggest a regular weekly report that might be produced by the MIS, which includes
information based on the activity you have just identified. Can you think of a
situation in which this activity might be included in an exception report, in order to
draw attention to a potential problem ?
• Tactical management are responsible for forward planning, based on a combination of
MIS reporting and forecasting with the aid of a DSS. What sort of decision about
future business operations might incorporate information about the activity you
originally defined ?
• Strategic management make use of external as well as internal data in developing
long term business strategies. What examples of external data might be relevant to the
strategic planning of a supermarket chain ?
1.6.2 Using Corporate Information
Make a list of all the different organisations that are likely to have recorded your personal details (UCT, sports club, cellphone company, hospital, school, church etc).
• In what ways could this information have been useful in monitoring the (past)
activities of the organisation?
• In what ways could this information be used for future planning?
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2. Transforming Data into Information
In everyday speech, we do not always draw a clear distinction between the terms “data” and
“information”, but the difference between the two is vital to the understanding of what IS is all about. Data is a collection of raw facts, each one of them insignificant when viewed in isolation. The purpose of an information system is to process that collection of raw facts in some way, so as to produce information that is useful to somebody.
For example, if the telephone directory contained a random assortment of names, addresses and telephone numbers, in no particular order, and with no logical association between names and phone numbers, it would be of no use to anybody. The facts (data) might all be present, but the information value of such a directory would be worthless. By associating each phone number with the name of the corresponding subscriber, and by sorting the list in alphabetical order of surname, information is produced. This helps to illustrate the inherent complexity of any information system – first you need to define what purpose it is going to serve (i.e. what information you want to produce), then you need to identify what data will be required in order to generate that information, work out how the data will be captured, how it will be stored, how it should be processed to get the desired result, and how the resulting information should be communicated to the person needing it.
Viewed in this way, we can see that data and information have very different characteristics.
2.1 Data
Since facts are about something, data refers to some outside object, event or concept. Data does not necessarily have to refer to a physical object: it can be about concepts (I think therefore I am a thinker; my bank balance is R4321.01 in debit), relationships between objects (I live in Oubordvolwater), etc. but it does pertain to an objective real world “out there” which the information system seeks to describe or model. Often the data model is an incomplete model since we are usually just interested in certain aspects of the real world. Alternatively, a complete model may consume too many resources or not be practical.
It follows logically that facts or data have a truth-value. They are true if they reflect the state of the outside world accurately. Of course, they can also be false, as is the case in the last two statements. Sometimes, it may not be possible to check the truth-value; in this case, the truth-value of the data element may be ambiguous.
Also, data has to be represented somehow. This representation can take one of many forms, all of which boil down to some particular structuring (pattern) of matter or energy. You have one example in front of you: this sentence consists of shapes made up of black ink particles on a white sheet of paper! (It can also be dark grey on light grey, depending on the print and paper quality.) We will discuss the representation issue in more detail later.
The fact that data is represented in a matter or energy form leads to another characteristic of data: it is encoded using a specific symbolism and the data can be understood only if one knows how to decode it. The symbolism can be a certain language and its written alphabet, a 10 [Free reproduction for educational use granted]
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digital (numerical) representation of sound frequency (compact discs), the colour and shape of flags (ship-to-ship visual signalling) or any other agreed code. Often many different options exist depending on need: an English message could be spoken or “signed” in sign language, written using the “normal” alphabet or in shorthand, in Braille, in Morse code, in bar code etc.
A final characteristic of data is that it can often be structured quite easily into a standard format and grouped into large sets of similar data items, especially in organisational contexts: address lists, customer records, inventory details, personnel records.
2.1.1 Representing Data
Data can exist only if it is encoded using some form of structured matter or energy. The actual physical encapsulation (in matter or energy form) of the data is its storage medium. The following are just some examples of how data can be represented.
• Ink particles on a piece of paper or other material (book, packaging, T-shirt logo,
graffiti)
• Polystyrene lettering or logos on a promotional in-store display board
• Needle pins on a city map (indicating e.g. locations of recent robberies)
• Magnetic polarisation of suitable materials (music tapes, floppy diskettes)
• Light pulses through air or glass fibre (flashing lighthouse, laser light in optical fibre)
• Electronic pulses through copper, etc.
The way that data is represented within a computer system, is dictated by the fact that the basic electronic circuit inside a computer can usually manage only two different states: ON or OFF, i.e. either electricity is flowing or it is not; or, depending on which circuit we are discussing, it either holds an electrical charge or it does not. This is why computers are called binary: they can work only with two values (“bi” means two as in bicycle: two wheels). The ON and OFF state can represent, depending on convention, a “Yes” or a “No”; a “True” or a
“False”; a “0” or a “1”. Or, in fact, anything else that could be coded using only two discrete values: positive/negative (numbers), white/black (printing), open/closed (switch), in/out of stock, registered or not, pass/fail etc. In this sense it can be said that computers can count only... one ... two!
Anything that can be encoded using only a single one of these simplistic “On/Off” electronic circuits is said to consist of one bit of information. The word bit is allegedly derived by contracting the term “binary digit” because computer scientists usually represent these two states by means of the two digits 0 and 1.
A bit is the smallest unit of information, everything less than a bit is nothing! Unfortunately, most data is far more complex than “Yes/No”. But, amazingly, even the most complex
information can be represented using these simplistic binary circuits.
2.1.1.1 How Computers Store Numbers
We are all familiar with the decimal numbering system, based on the number 10. In this
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system, the available digits are 0, 1, 2, 3, 4, 5, 6, 7, 8, and 9, i.e. for every number position, there are 10 possible options. Numbers consisting of multiple digits are computed based on powers of 10. For example, consider the number 4075. The value of this number is computed in the following way (from right to left):
5x1 + 7x10 + 0x100 + 4x1000 = 4075
Since computers are inherently based on the idea that their components are either on or off, this is usually represented in terms of binary numbers, where all digits are either 1 or 0. This means that for every number position there are only two options, 0 or 1. Numbers consisting of multiple digits are computed based on powers of 2 (since there are only two possible
options for each position). For example, consider the number 11001. The value of this binary number in decimal terms would be computed in the following way (from right to left):
1x1 + 0x2 + 0x4 + 1x8 + 1x16 = 25
In decimal numbers, each “column” is 10 times the column to its right, so from right to left we have units, 10s, 100s, 1000s, etc. With binary numbers, each column is 2 times the column to its right (because a column can hold only two possible values, 0 or 1), so instead we have units, 2s, 4s, 8s, 16s, 32s, etc.
Thus to translate a decimal number into binary format, so that it can be stored and processed by a computer, we need to determine how many 32s, 16s, 8s, 4s, 2s and 1s the decimal
number contains, and indicate the presence or absence of each of these by using a 1 or 0 in the correct column position. For example, the decimal number 43 consists of a 32, no 16, an 8, no 4, a 2 and a 1 (32+8+2+1=43), and would be represented in binary as 101011. In practice, numbers are usually represented in groups of at least 8 bits; and more commonly, 32 bits are used to allow for the storage of extremely large numbers.
2.1.1.2 How Computers Store Text
Much of the data in which people are interested does not consist of numbers but rather of text e.g. names, addresses, descriptions and sentences such as “The Bulls have won the match!”
Any piece of text is composed of a collection of alphanumeric symbols: letters, punctuation marks and spaces. Our roman alphabet letters (both upper and lower case), the digits 0 to 9, the punctuation symbols as well as a number of “special symbols” which are commonly used in text such as the $ or the %, together add up to about 100 different characters. Since we already have a way of storing numbers in binary form, it is a simple matter to just assign a number to each of the characters we wish to represent. There are indeed a number of
international standards for this: EBCDIC and ASCII are the two most common ones. Text is therefore commonly represented in a computer using bit sequences, which represent the
numbers of the various characters which make up the text, according to some standard list of character codes. Although 7 bits would be sufficient to store up to 256 different binary codes, for technical reasons it turns out that it is easier to use groups of 8 rather than 7 bits; so text is usually stored in computers by encoding each character of the message in “clumps” of 8 bits.
These sets of 8 bits are called bytes. Our “The Bulls have won the match!” sentence therefore would be represented by a sequence of 29 bytes.
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Two notes to round off this section:
• As computers are being used in many countries that do not use Roman characters, the