Topic 2 Information and systems

Revision notes on information systems topic 2 of the course

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Different organisations have different information


  • Commercial organisations either purchase goods and then sell them on OR supply services to customers.
  • Examples include : retailers, wholesalers,banks,insurance companies,web design companies, accountants and solicitors.
  • Commerical organisations are mainly driven by the need to make a profit, there are many ways ICT can be used to achieve this.


  • Main function of this type of organisation is to manufacture products of process raw materials or be involved in construction, these are then sold to make a profit.
  • Examples: car manufacturers, house builders, household appliance manufacturers, chemical manufacturers, quarries
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Public service organisations

  • Provides goods and services from public funds
  • Producing a profit is not an aim of the these organisations.
  • Their main aim is to obtain the maximum benefit for the public they serve
  • Examples: hospitals, schools, police service and the armed forces.
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Scale of an organisation

Small = 50 employees or less, informal structures, confined to a single site and uses LANs

Medium = 50 and 500 employees, formal structures and uses WANs and LANs

Large = 500 or more employees, diverse range of products or services, can involve lots of seperate organisations, usually are hierarchical structure of management, example: banks. Uses WANs and LANs and is usually global.

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Nature and management style


  • Clear authority and all decisions made by senior managers.
  • Workers are always told what to do and do not work on their own initiative
  • Information is channelled to the people at the top of the organisation for them to make a decision.
  • Efficiently run organisations but staff are de-motivated because they do not feel as involved in the organisation.


  • Senior managers have authority but decisions made in employees interests rather than business interests.
  • Employees are happy and loyal to the company.
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Nature and management style


  • Employees take part in the decision making process
  • This type of management is useful for ICT projects as teams are made up of people with different specialisms such as networking and databases
  • Slow process as meetings need to be arranged


  • Least formal management style
  • Staff expected to manage their own areas
  • Staff are at the same level and different people work on different tasks
  • Very little communication between members of staff and can lead to lack of focus for the company and the staff and lack of leadership
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Ordering systems

This type of system will take a customer's order and process the payments and then deliver the goods to the customer.Computerised systems are used to increase efficiency and speed

5 steps to a ordering system

  • collect the order details from the customer
  • check the stock levels and make sure the desired products are in stock
  • process the payment which links to the customer's account
  • send order details to the warehouse for goods to be picked and packaged
  • organise delivery with a delivery company such as UPS

Ordering systems need to deal with:

  • out of stock products/ substitution of products
  • returns of goods that are faulty or damaged/ refunds to the customer
  • multiple deliveries and customers changing their order
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Customer support

Provides service to customers who have brought products or services, for example payment queries, organising repairs etc.

A bank customer support worker may have to deal with the following:

  • enquiries about different accounts
  • lost credit cards/ forgotten pins
  • queries about statements
  • complaints
  • transfer of money between 2 different accounts

Manufacturer of a product rather than a service:

  • customer complaints
  • technical advice
  • arranging repairs
  • payment problems
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Different levels in an organisation


  • Directors, chief executives
  • Need high level overviews with little detail
  • Tasks: takeovers of other businesses, expanding the business, introduction of new products.


  • Heads of departments, supervisors
  • Need summaries and reports to decide how to manage a problem
  • Tasks: How to achieve objectives set out by Strategic level staff, decisions using operational level information, for example if a product is not selling well


  • Teachers, cleaners
  • Involved in the day-to-day aspects of the business, customer payments and orders.
  • Tasks: paying wages, ordering stock, paying for stock, queries etc.
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Different personnel have different information nee


  • These are companies that supply products or services to another company
  • Examples: utility companies such as electricity, water, telephone. Maintenance such as decorators, heating engineers. Book suppliers, software suppliers, equipment suppliers.
  • These companies have close relationships with their customers to maximise each others profits.
  • Often use extranets to share information


  • People who place orders for products and services/ can be done via the internet
  • Information about the customer is kept for future orders
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Different personnel have different information nee

Official and legal bodies

  • Most organisations own vehicles which means they have to supply insurance information and licensing authorities
  • Most organisations process personal data which means they have to register their use of personal data with the Information commissioners office
  • Limited companies have to file their end of year accounts a certain way for a government department.
  • Also have to deal with Her Majesty's Revenue and Customs and give them information about tax, VAT and national insurance.
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Organisations exchanging information with external

Companies that communicate with each other need to ensure that their information can be used by both companies and can be exchanged.


  • Ensure privacy of any personal data transferred
  • Methods include: encryption, use of private networks, firewalls to prevent hackers, job-based access restrictions.


  • Information being transferred can be of use to their competitors so must be kept safe.
  • Both companies need to have an ICT policy that is acceptable to the other
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Organisations exchanging information with external

Legal compliance implications

  • Information can only be transferred between countries that have effective data protection legislation, this is a requirement under the data protection act.
  • They have to register the use of personal data with the ICO and inform them of organisations they share their data with
  • Have sufficient security to ensure privacy and security of personal data
  • Do not break any copyright laws when transferring data, for example file sharing sites such as limewire are illegal.
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Back office systems

Systems that run all the routine business admin processes, usually consist of an accounts package or tailored database.

  • Record the details of all the sales made
  • Record the details of all purchases made
  • Updates stock details
  • Generate any necessary paperwork such as invoices, receipts and packing slips
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Transaction processing systems

These systems process one transaction at a time as it arises

Examples of transactions include:

  • an order being taken
  • a customer paying for goods
  • a flight or a holiday being booked
  • a payment being made to suppliers
  • an employee being paid
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Workflow and document management systems

DMS is an ICT system that keeps track of electronically stored documents , paper documents are still used in companies so these need to be scanned in so they can be digitised.

Work flows between many different people in an organisation as different people are responsible for different tasks

Workflow management provides automatic routing of documents to the personnel responsible for that area of the business. Each person is responsible to complete a step in the business cycle. This does not depend on manual flow of document. It uses databases and networks so that each user is able to access the data.

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Management information systems (MIS)

This is an ICT system that is designed to take internal and external data and turn it into information. This is converted into an appropriate and understandable form that will allow managers at different levels in an organisation to make an informed decisions.

  • Managers are able to make effective decisions for planning, directing and controlling the activities for which they are responsible.
  • MIS are designed primarily with the information needs of managers in mind


  • Many managers do not understand the role of information
  • To a manager, having lots of correct info reduces uncertainty when making decisions, this then creates a better outcome overall for the company 
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Decision support systems

This is a type of system that supports the decision making process, for example if there are 3 different ways of making a profit for the company then the DSS will guide them on which is the most profitable. 

Also they can be used to extrapolate figures to provide forecasts (future sales)

This type of system can mainly be used by the senior management team as they will need to make the crucial decisions about how the company functions and what the next steps are in the future of the company. 

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Commerce is all the activities that are needed for the successful running of the business and would include:

  • Buying 
  • Distributing
  • Marketing
  • Selling
  • Paying

E-commerce involves the above activities but are performed via the internet or other electronic networks. 

Amazon is an example of an e-commerce site, back office systems are also used to store transactions and relevant data. Both the e-commerce site and the back office system can communicate with each other which allows up to date stock levels. 

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Mr A Gibson

What sort of systems do organisations want? "ICT Systems" - correct - but which one(s)? This covers more than a dozen and there are plenty of examples and valuable information to help consolidate what you know about this topic.

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