Information Systems are essential for running and managing the business - True Statement

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INTRODUCTION

Information Systems - It is not a single discipline; it is an amalgamation of computer hardware and software, data, processes and telecommunication networks which helps in making the flow of business simpler, more organized, and more profitable. It is used to store, create, and maintain important data of businesses so that it can be used to make better decisions for the company.

Information Systems should not be considered as an afterthought to an organization's business model, rather,  it should be integrated throughout all of the firm’s activities. If done right, the successful implementation of MIS can help reduce regulatory costs, strengthen a firm's internal control, smoothen the selling of existing products or services and the introduction of any new products or services in the pipeline.

EVOLUTION OF INFORMATION SYSTEMS

1950 - 1960: Electronic Data Processing, Transaction Processing System

Amid this period, the job of IS was generally to perform exercises like transaction processing, record keeping, and book keeping. IS was basically utilized for electronic data preparing (EDP).

1960 - 1970: Management Information Systems

In this era, the role of IS became more diverse and leaned towards decision focused (i.e, Management Information System) from process focused (i.e, Transaction processing System). MIS conveys data as presentations and pre-indicated reports to help in decision-making.

1970 - 1980: Decision Support Systems

Introduction of personal computers (PC) took place in this era. Decision Support System (DSS) provides interactive ad-hoc support for the decision-making process to senior level managers.

1980 - 1990: Executive Information Systems

There was a growth of departmental computing in this period due to many organizations obtaining their own hardware and software to suit their departmental needs. Rather than hanging tight for backhanded help of unified corporate administration division, workers could utilize their own assets to help their activity prerequisites.

1990 - 2000: Knowledge Management Systems

There was a rapid development of the intranets, extranets, internet, and other interrelated global networks dramatically changed the competences of IS in business. This period additionally observed a rise of Enterprise Resource Planning (ERP) frameworks. There was also the development of Artificial Intelligence (AI).

2000 - Present: E-Business

Almost every business works over the internet. There is better network infrastructure, a larger amount of incorporation of functions crosswise over applications and incredible machines with the higher storing limit. There is an increase in the use of cloud computing and big data that help business in their day-to-day operations and decision making. 

BENEFITS OF INFORMATION SYSTEMS

• Relevant Information -  The information gathered is customized as per the person’s needs, for better and fast decision-making.
• Customized Formats - Data becomes easier to manipulate and interpret if it is customized. Customization with information system makes it more effective because data becomes easier to use.
• Adaptability -  The flexibility feature of Information System is what makes it possible for managers to interpret valuable data. Managers and employees can format data according to their needs and requirements.
• Real Time Information - Manufacturing operation of any business can improve with the help of Information System. A production manager can use real-time information from information systems to figure out the actual cause in case of a shut down in the production process. 

USES OF INFORMATION SYSTEMS

• Communication systems - One of the manager’s functions is to organize and communicate data within the organization. Managers can store data in folders that they can share with other employees. This process will be more quick and effective than sharing data over traditional emails.
• Efficient Decision Making - Information systems help taking better and efficient decisions. Information System such as Decision Support System (DSS) helps in evaluating and then selecting the best alternatives to get better and faster results. Access to up to date information is what helps managers in selecting fast and effective choices.
• Records Keeping - Information systems are built in such a way to record and store data. The data is recorded, organized and then processed in such a way to provide managers with only the relevant necessary information. Managers can then use this information to prepare budgets, targets or goals for the organization.
• Planning - Executive Support System (ESS) for top-level management and Management Information System (MIS) for middle-level management helps in Planning and decision-making. These plans help managers to delegate work and help the organization in achieving its goals and targets.
   

TOYOTA - INFORMATION SYSTEM EXAMPLE

Toyota is a great example when it comes to using Information systems in an innovative way. They introduce new processing technologies to cope up with the changes in ever-changing external environment.

1980s - 1990s : Toyota placed emphasis on incorporating changes and advancing their information systems with the changing market. They made advances in the commercial systems, engineering systems, and Computer aided Manufacturing systems.

1990s - 2000s : Toyota focused on developing the administrative systems, and also reformed the overall management system. The Engineering department systems needed additional development. For which information systems proved to be helpful.

2000s - Present : Toyota is focusing on standardizing the whole scenario with relevant information systems and they shifted the whole process to TCP/IP. based system in Japan. The Economic crisis of 2008 enforced Toyota to improvise and refine it's Information Systems for better efficiency and maintenance.

Due to Implementation of Information Systems, Toyota was able to increase its sales volume by 18.24% from 1980 till 2017.

CONCLUSION

Overall, information systems play a vital role in the survival and growth of a business today. Not only do information systems help monitor and operate the organization by providing effective tools for storing the company wide data and connecting all departments inside the organization, but the business can also update the changes of economic environment and then make the effectively relevant decisions. In addition, information systems increase the intimacy in relationships with customers and suppliers and create the competitive advantages of the business.


Nowadays, more and more businesses realize the significant benefits of information systems, especially in the context of globalization, information systems can be the survival factors of a business. Therefore, the businesses are increasingly investing in the information systems, which contribute to foster the development of information systems in the future. Particularly, the information systems which allow businesses to make interaction and transaction remotely will be focused to enhance in order to be compatible with the economic globalization.

References

1. Markgraf Brat (N.D.), Importance of Information Systems retrieved from https://smallbusiness.chron.com/importance-information-systems-organization-69529.html
2. N.A. (2012), 75 Years of Toyota, retrieved from https://www.toyota-global.com/company/history_of_toyota/75years/data/company_information/personnel/information_systems/business_data_processing_systems.html
3. Sylvan Roy (N.D.), Tangible Benefits of Information Systems retrieved from https://smallbusiness.chron.com/tangible-benefits-information-systems-50155.html
4. Vaish Punish (April 7, 2017), Evolution of Information Systems Functions retrieved from https://adataanalyst.com/information-systems-management/evolution-information-system-function/
5. N.A. (N.D.), Information Systems, retrieved from https://en.wikipedia.org/wiki/Information_system.