Information Systems in Business

16/02/2020 0 By indiafreenotes

Business information systems are sets of inter-related procedures using IT infrastructure in a business enterprise to generate and disseminate desired information.

Such systems are designed to support decision making by the people associated with the enterprise in the process of attainment of its objectives.

The business information system gets data and other resources of IT infrastructure as input from the environment and process them to satisfy the information needs of different entities associated with the business enterprise.

There are systems of control over the use of IT resources and the feedback system offers useful clues for increasing the benefits of information systems to business. The business information systems are sub-systems of business system and by themselves serve the function of feedback and control in business system.

Features of Business Information System

Characteristics & features of business information system are:-

  1. The business information systems are subject to the dynamics of business environment and need to be flexible enough to absorb the inevitable changes in the information needs of business. They have to be efficient to satisfy the demanding and ‘hard task masters,’ the business managers. Thus, there is need to balance the conflicting objectives in the process of designing business information systems.
  2. Business information systems need to be proactive. They should anticipate changes in information needs of users and accordingly adapt themselves to suit their needs. This has become important because of the fact that the managers get involved in the routine activities to the extent that the decision making becomes a matter of imitating what competitors are doing or planning to do, rather than making an informed choice.
  3. The purpose of business information system is to cater to the information needs for decision making in business.
  4. The business information systems have to be designed keeping in view the availability of financial and human resources to the business enterprise.
  5. The cost effectiveness is a matter of prime concern in the development and maintenance of business information systems. Economic justification for investment in IT infrastructure for business information systems is a pre condition for its existence and sustenance.

Key Components of Business Information System

Information systems can be described by four of their key components which are:

  1. Decisions
  2. Transactions and processing
  3. Information and its flow
  4. Individuals or functions involved.

It is difficult to observe the decision process through we can see and review the results of a decision. Transactions are usually more visible, though many current systems use computer programs, which are not easy to understand, to process transactions. In principle, an observer can see information and its flows. Individuals can be observed too, but it is not always easy to figure out the information processing functions they perform.