Information Systems: Using Information for Int 2 and Higher

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Information Systems

Using Information

[INTERMEDIATE 2; HIGHER]



Alan Patterson







I
nformation Systems Intermediate 2; Higher

Using Information

-----------------------------------------------------------------------------------------------------------

© Lear
ning and Teaching Scotland

2















The Scottish Qualifications Authority regularly reviews the arrangements for National
Qualifications. Users of all NQ support materials, whether pub
lished by LT Scotland or
others, are reminded that it is their responsibility to check that the support materials
correspond to the requirements of the current arrangements.






















Acknowledgement

Learning and Teaching Scotland gratefully ack
nowledge this contribution to the National
Qualifications support programme for Information Systems.


First published 2005



This publication may be reproduced in whole or in part for educational purposes by
educational establishments in Scotland provided
that no profit accrues at any stage.


ISBN 1 84399 076 8


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nformation Systems Intermediate 2; Higher

Using Information

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CONTENTS



Tutor introduction

4

Student introduction

8

Section 1: Data and information

9

Section 2: Organisational information systems

27

Section 3: Information management software

60

Section 4: The social, legal, ethical and economic

implications of information systems

89

Sec
tion 5: Useful resources


Web links

111

Bibliography

113

Software evaluation form

114

Answer section

115













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nformation Systems Intermediate 2; Higher

Using Information

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INTRODUCTION


Tutor introducti
on (Higher and Intermediate 2)


This unit is designed to develop knowledge and understanding of the principles,
features and purposes of information and the systems used to create, store,
process, retrieve and present information. It also develops knowledg
e and
understanding of the wide
-
ranging implications of the growing use of information
systems within society. It provides an opportunity to develop practical skills in the
use of contemporary information handling. Candidates may then apply this
knowledge
and these skills to solve practical problems.


Target audience


While entry is at the discretion of the centre, candidates for the Higher level
would normally be expected to have attained one of the following qualifications
(or equivalent experience):




the

corresponding unit at Intermediate 2.



Intermediate 2 Information Systems



Intermediate 2 Computing



Standard Grade in Computing Studies at Credit level.


The unit has two outcomes (Higher and Intermediate 2):


1.

Demonstrate knowledge and understanding of the
principles, features and
purposes of information, organisational information systems, information
management software, and the social, legal, ethical and economic
implications of information systems.


2.

Demonstrate practical skills in the use of contemporary

hardware and
software in the context of creating, storing, processing, retrieving and
presenting information.


Outcome 1 is assessed by a multiple
-
choice test. Outcome 2 is assessed by a
checklist. Both of these are included in the NAB.


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Introduction


Le
arning and teaching approaches


The materials for Higher and Intermediate 2 have been incorporated into the one
pack, making it possible to run bi
-
level classes. Suitable questions and activities
have been included at the end of each section (with Intermed
iate 2 questions at
the end of Intermediate 2 content and Higher questions at the end of each Higher
section). There has also been an attempt to include more activities for
Intermediate 2 to allow the tutor to concentrate on delivering the rest of the
High
er content of the unit to Higher students.


It is recommended that the assessment of the practical element and delivery of
this unit be combined in order to maximise the amount of time the students are
working on the unit. These study materials should be m
ade freely available to the
students during the Outcome 2 assessment, as should any tutorials,
documentation or other materials relevant to the hardware or software required to
complete the assessment.


A mixture of student
-
centred, resource
-
based learning

and tutor
-
led class
teaching is recommended. Students will require access to appropriate computer
hardware and software and Internet access throughout this unit.


The
shaded margins
alongside of the text indicate material for the Higher. A
range of suitab
le questions and activities is provided at various points throughout
the notes, and tutors should direct students to these activities as they see fit. A
wholly Higher class would be expected to study the Intermediate 2 and Higher
units but would probably o
nly be expected to undertake activities relating to the
Higher Outcome 2 assessment and any others the tutor sees fit to use to
enhance the course. The questions should also provide a means of diagnostic
assessment as part of the learning and teaching of t
he unit.


Hardware and software requirements


This unit requires that the student has regular use of a computer system, which
can be used throughout the unit for research on the World Wide Web and for
completing the software tasks. At the time of going to
print, the minimum
specification for such a system would be:




A Pentium III 800MHz Processor based PC or a 600MHz G4
-
based Apple
Power Mac.



Windows 2000 operating system on a PC



Sufficient RAM which is 128MB on a PC


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Introduction




Internet access



Word Pro
cessing, Spreadsheet and Presentation Software including PIM
software such as Microsoft Office 97 at least (Office 95 on a Mac) but Office
2000 at least is recommended with Outlook.



Desk Top Publishing and Web Authoring Software



Project Management Software

is optional and may be demonstrated by the
tutor. (Although Project is expensive, an evaluation package can be
downloaded and used for 30 days free of charge; either SmartDraw or
Microsoft Project can be used.)


Practical work


The tutor should supplement

this pack with a suitable range of practical activities
using a range of software applications, in order to develop and consolidate the
learner’s experience and understanding, and to provide evidence to support the
checklist of practical skills for Outcom
e 2. Advice on appropriate levels of
treatment of practical skills is included in the NABs provided by SQA.


How to tackle this Unit


A standard learning pattern is suggested for your use throughout this unit, as
follows:




A clear outline of the main teach
ing points



Questions to check the understanding of these points



Practical work where appropriate to illustrate the learning.


What is in the pack?


Section 1: Data and information


The difference between data and information, metadata, categorisation of
in
formation and characteristics of information. Questions and tasks.


Note that in a bi
-
level class there is only limited Intermediate 2 material in Section
1, and the first questions will not keep Intermediate 2 students busy for the length
of time taken by

the Higher students to complete the rest of the topic. It is
suggested that Intermediate 2 students can follow tutorials and/or complete some
of the tasks for the software packages they are going to use later (Word
Processing, DTP, Spreadsheet, Presentati
on and Web Authoring).


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nformation Systems Intermediate 2; Higher

Using Information

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Introduction


Section 2: Organisational information systems


Explanation, definition, description and exemplification of organisational
information systems. Questions and tasks.


Section 3: Information management software


Explanat
ion, definition, description and exemplification of different classes of
software. Questions and tasks.


Section 4: The social, legal, ethical and economic implications of
information systems


Explanation, definition, description and exemplification of soc
ial, legal, ethical and
economic implications of information systems. Questions and tasks.


Section 5: Useful resources


Bibliography, and useful web links summarised.


Section 6: Additional resources


Software evaluation pro
-
forma. Answers to questions u
sed throughout the unit.


PowerPoint presentation


A PowerPoint presentation linked to this pack may be downloaded from the
Information Systems subject pages in the e
-
library at
www.LTScotland.org.uk/NQ


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Intr
oduction


Student Introduction


We are said to live in an age where information and knowledge are so important
that society can be divided up into two groups. These are the ‘information rich’
group and the ‘information poor’. If you are information rich yo
u have access to
many TV and radio channels, books, newspapers and journals, and of course
computers and the World Wide Web. Those who are information poor tend to not
have access to the Web and probably find it difficult to access relevant books and
journ
als. Even in general conversations a discussion about a TV programme
shown on satellite TV will be lost on people who only have 4 or 5 terrestrial
channels. If you are following this course you will probably be information rich.


We are going to examine th
e nature and uses of information by looking at:




the differences between data and information



organisational information systems



information management software



the implications of information and communications technology.


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nformation Systems Intermediate 2; Higher

Using Information

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SECTION 1


Data and informatio
n


Data
is raw unprocessed facts and figures that have no context or purposeful
meaning and
information
is processed data that has meaning and is presented
in a context.


For example, a computer operator may enter 36.41, which is data, because we
do not kn
ow why or in what context it is being used. However, if this number then
appears on a bill to show that you owe a company £36.41 for goods received
then this data has changed into information, because it has acquired a context
(it’s a bill) and meaning.


T
he figures 36.41 will be held as binary data on some media such as a hard disk.
It is the software which accesses this data and displays it in its context. It may
also have some structure, if it is held in a program like a database for example,
and a datab
ase will also give it structure. So, it is the software which turns the
figures from data into information and gives them meaning.


The binary patterns on backing storage devices such as a disk, CD or DVD, or
memory stick, are all classed as data. For exam
ple, the binary patterns that
describe an icon on your desktop are data. They become information after the
operating system software has processed them, because then they become
meaningful to you as the icons representative of your hard disk or Internet
ex
plorer.


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Data and information


Questions on data and information


1.


Look at this list and decide whether the following are data or
information:


(a) The registration number of a car


(b) 234.73

(c) SA04KRT

(d) An icon on a computer’s desktop

(e) 0
0101001

(f) A binary stream held on a hard disk

(g) Unprocessed raw facts

(h) The contents of a field in a database

(i) A paragraph of text in a word
-
processed document

(j) 04081953

10


2.


Give two examples of data that is generated in a school’s


administr
ation and assessment system.

2


3.


Give two examples of information that is generated in a


school’s administration and assessment system.

2


Total marks 14

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Data and information


Knowledge


Humans have an endless thirst for knowledge, but how do we obtain knowledge?
We can read books and magazines, study course materials, and of course we
can gain knowledge from watching TV

and listening to the radio. The knowledge
about the weekend’s sports matches can mean as much to one person as the
latest advances in rocket science does to another.


We tend to gain knowledge from information and we use that information to make
decisions
.


Knowledge can be split into two categories:
explicit
and
tacit. Explicit
knowledge is
rules or processes or decisions that can be recorded either on paper or in an
information system.
Tacit
knowledge exists inside the minds of humans and is
harder to re
cord. It tends to be created from someone’s experiences, so again it
is based on a set of rules or experiences.


Metadata


Metadata can be thought of as data that describes data. It may have been
introduced to you in the Database Unit where it is defined a
s a data dictionary.
This is one example, but other formats of metadata exist. It may be the card
-
index system used by libraries before computerisation, where each card told you
the author, title and location of the book. It can also be thought of as data
about
documents or files stored on the computer. The computer keeps a file on its hard
disk where it records information about each and every file on the computer. This
includes information such as when the file was created or modified; who created
it; the

size of the file; the file type it is. This master or directory file is an example
of metadata.


Categorisation of information


Information can be categorised under many headings that help us to determine
its overall usefulness. The main categories are So
urce, Nature, Level, Time,
Frequency, Use, Form and Type. We will examine each of the categories and
their sub
-
categories in some detail.




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Using Information

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Data and information


Sources of information


Primary information

A primary source of information is one that prov
ides data from an original source
document. This may be as simple as an invoice sent to a business or a cheque
received. It may be more complex, such as a set of sales figures for a range of
goods for a tinned food manufacturer for one week, or it may be a

set of sales
figures over several weeks and several locations. There are many examples of
primary sources in many walks of life, but generally a primary source is defined
as being where a piece of information appears for the first time.


Secondary informa
tion

A secondary source of information is one that provides information from a source
other than the original. Secondary sources are processed primary sources,
second
-
hand versions. Examples of secondary sources could be an accounts
book detailing invoices

received, a bank statement that shows details of cheques
paid in and out. Where statistical information is gathered, such as in surveys or
polls, the survey data or polling data is the primary source and the conclusions
reached from the survey or the resu
lts of the poll are secondary sources.


Internal information

All organisations generate a substantial amount of information relating to their
operation. This internal information is vital to the successful management of the
organisation. The information ma
y be available from a number of sources within
the organisation, for example:




Marketing and sales information on performance, revenues, markets shares,
distribution channels, etc.



Production and operational information on assets, quality, standards, etc.



Financial information on profits, costs, margins, cash flows, investments, etc.



Internal documentation such as order forms, invoices, credit notes,
procedural manuals.


External information

An external source of information is concerned with what is happen
ing beyond
the boundaries of the organisation. This covers any documentation relating







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Data and information


to a subject area produced as a summary or detailed report by an agency
external to an organisation. Such information may be obtainable from
gov
ernment agencies or private information providers. Examples might include:




census figures



• telephone directories



judgments on court cases


• computer users’ yearbook



legislation, for example


• gallup polls


the Data Protection Act



• national opin
ion polls



trade journals




• Ordnance Survey maps



professional publications


• financial services agencies such



industry standards




as Dunn and Bradstreet



the Internet


Nature of information


Formal information

This involves presenting information in

a structured and consistent manner. It is
usually defined, within an organisation, as the main way of communicating
between and within parts of the organisation. It is also usually the main way of
communicating externally from an organisation. The main me
thods of formal
communication are still the formal letter, properly structured reports, writing of
training materials, etc. Formal information is communicated in cogent, coherent,
well
-
structured language.


Informal information

This describes less well
-
str
uctured information that is transmitted within an
organisation or between individuals who usually know each other. It tends to be
categorised as ‘unofficial’ information, and is communicated by casual
conversations, e
-
mails, or text messages between collea
gues. The language
used is less well structured than formal communication and tends to include
colloquialisms and shorthand; and spelling is less important.


Quantitative information

This is information that is represented numerically. Any event or object
that can
be represented as a set of numbers is an example of quantitative information.




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Data and information


Qualitative information

This is information that is represented using words. Any event or object that is
represented using words to describe it
s attributes is an example of qualitative
information.


Levels of information


Within an organisation planning, control and decision
-
making are carried out at
various levels within the structure of the organisation.


The three levels at which information c
an be used are
strategic, tactical
and
operational
and there is a direct correlation between the levels of importance of
individuals or groups within an organisation and the level of information that is
being communicated.


Strategic information

Strategic
information is used at the very top level of management within an
organisation. These are chief executives or directors who have to make decisions
for the long term.


Strategic information is broad based and will use a mixture of information
gathered from
both internal and external sources.


In general a timescale may be from one to five years or even longer depending
on the project. Some oil related projects are planned from the outset to last for 25
or more years. A supermarket building a new superstore w
ill look at a timescale
of 20 years or so, whilst even a small business may have a five
-
year strategy.


Strategic plans will have little or no detail in them and more detailed strategic
plans will be made slightly lower down the managerial ladder. A good s
trategic
plan will be easier to flesh out lower down than a poor or vague strategic plan.
Similarly, well constructed and more detailed plans will be easier to implement
than poorly constructed plans.


Tactical information

The next level down is the tactic
al level, and tactical planning and decision
-
making takes place within the guidelines set by the strategic plan.




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Data and information


Tactical information will be mostly internal with a few external sources being
used. Internal information is likely t
o be function related: for example, how much
‘down time’ a production line must allocate for planned maintenance.


Tactical information is used by middle management (employees) when managing
or planning projects.


The timescale is usually at least between
6 months and 5 years (depending on
the scale of the strategic project). Circumstances vary but a small project may
have a tactical timescale of between one and six months.


Tactical plans have a medium level of detail and will be very specific; they deal
w
ith such matters as who is doing what and within what specific budgets and
timescales.


These plans have medium scope and will address details at the operational level.
They will generally have specific objectives and be geared towards
implementation by op
erational level employees.


Operational information

The lowest level is operational and operational planning takes place based on the
tactical plans.


The lowest level of management or workers in an organisation implements
operational plans. These may be s
ection leaders or foremen in a large
organisation or workers such as shop assistants, waiting staff, and kitchen staff,
etc., in smaller businesses where there is no supervisory layer.


The timescale is usually very short, anything from immediately, daily
or at most a
week or month.


Results of operational work will usually be passed upwards to let the tactical
planners evaluate their plans.


Time


Historic information

This is information gathered and stored over a period of time. It allows decision
makers
to draw comparisons between previous and present activities. Historic
information can be used to identify trends over a period of time.




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Data and information


Present

This is information created from activities during the current work
-
window (day,
week

or month). In real
-
time systems this information would be created instantly
from the data gathered (for example, the temperature in a nuclear power plant
turbine), giving accurate and up
-
to
-
date information.


Future

This is information that is created usi
ng present and historic information to try to
predict the future activities, trends and events relating to the operation of an
organisation. An example would be sales figures for a company: if the sales
figures are up 10% from those recorded this time last

year it might be anticipated
that next month’s sales figures will also be up by 10%.


Frequency of information


Continuous

This is information created from data gathered several times a second. It is the
type of information created by a real
-
time system.
For example, sensors may be
set up to collect temperature and humidity readings in a large commercial
greenhouse. It will be important for that information to be collected constantly
because any variation in either the temperature or the humidity could poi
nt to the
failure of some machinery and an alarm could be sounded to alert the staff. A
very important system exists on modern aircraft where the navigation and flight
-
control systems are continuously monitoring and making adjustments; another is
on a comp
uterised production line where constant monitoring allows the system
to correct faults. Obviously many other types of real
-
time systems exist but a
feature of them all will be that they check data continuously.


Periodic

This is information created at regu
lar timely intervals (hourly, daily, monthly,
annually). Different examples of information generated by an organisation are
needed at specific periods of time.




Annually


On an annual basis a company must submit its report and
accounts to the shareholders
.



Monthly


Banks and credit
-
card companies produce monthly statements for
the majority of their customers.



Daily


A supermarket will make daily summaries of its sales and use the
product information to update its stock levels and to re
order stock
automa
tically.



Hourly


A busy call centre will often update totals for each operator on an
hourly basis and give the top employee for the hour some reward.



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Data and information


Use of information


Planning

Planning is the process of deciding, in advance, wh
at has to be done and how it
is to be done. Planning should be based on good information. Planning is not an
end in itself; its primary purpose is to provide the necessary structure for
decision
-
making and resulting actions, throughout the organisation.


T
he process of planning provides an opportunity to construct a sequence of
actions that, when executed, will achieve the required aims and objectives.


Basically, planning means decisions by management about:




what is to be done in the future



how to do it



w
hen to do it



who is to do it.


An objective is something that needs to be achieved and a plan contains the
activities or actions required to achieve the objective.


Control

Control can be defined as the monitoring and evaluation of current progress
against

the steps of a pre
-
defined plan or standard. If these tasks are not
proceeding in line with expectations then action is taken to bring the project back
in line with what had been planned.


Control is carried out at strategic, tactical and operational leve
ls. The type of
control changes according to the level of management as does the amount of
time spent on control.


At an operational level the majority of the time of the manager or supervisor will
be spent on control activities where the work of staff is
compared to very specific
financial or quantifiable terms (e.g. how many boxes have been packed).


At higher levels, planning and control are more closely linked, with management
being concerned with the monitoring of progress against the plan, assessing t
he
suitability of the plan itself and predicting future conditions.


Organisations and individuals must plan in order to operate effectively. Likewise
they must also operate controls to ensure that progress is being made against
the plan. These controls ar
e needed because unexpected events can cause
actual results to change from the expected planned results.


Control activities attempt to keep the organisation in line with the original plan or
to enable the organisation to change to meet the new conditions.

Unexpected
events range from short delays in the completion of an element of a plan


which
may be relatively minor


to major disturbances such as a large new competitor
entering the marketplace.






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Data and information


Control measures actual progres
s against what is expected and provides
information upon which remedial action can be taken, if required, either to change
performance in order to conform to the original plan or to modify the plan.


Decision
-
making

Decision
-
making is the process of select
ing an action or actions from those
possible based on the information available. Decision
-
making involves
determining and examining the available actions and then selecting the most
appropriate actions in order to achieve the required results.


Decision
-
m
aking is an essential part of management and is carried out at all
levels of management for all tasks. All decisions are arrived at in the same way.
The manager must choose, by some means, the result or results that s/he wishes
to achieve and do some form
of appraisal of the situation.


Decision
-
making is made up of four phases:




finding occasions for decision making



find possible courses of action (i.e. what choices are available)



choosing among these courses of action



evaluating past choices.


Forms of in
formation


Written

The vast majority of information created within an organisation is in the written
form. This can include hand
-
written or word
-
processed information and
information in e
-
mails as well as reports produced from different classes of
softwar
e, both general
-
purpose packages and bespoke software solutions.
Examples of written information are reports, memos and tables, receipts,
invoices, statements, and summary accounting information. The list is almost
endless and different businesses will pro
duce their own type of written
information.


Aural

Another common form of information is aural, which is information presented as
sound. The commonest form of aural information is of course speech and
examples of this would be formal meetings (where minute
s are taken), informal
meetings, talking on the phone and voice
-
mail messages. Nowadays many
organisations will have employees giving a presentation or talk to a group where
there may be use made of music and sound effects as well as speech.


Visual

This f
orm of information includes when pictures, charts and graphs are used to
communicate information. Again, many presentations will make use of data
projectors and presentation software that will include text, graphics and
animations. Full video can also be p
rojected via a data projector, and
presentations can use video filmed with a digital video camera and then edited on
a computer and distributed via CD or DVD now that DVD writers are quite
common.




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Data and information


Types of information


Detailed

De
tailed information might be an inventory list showing stock levels, actual costs
to the penny of goods, detailed operating instructions, and so on. This information
is most often used at the operational level within an organisation.


Sampled

This informati
on usually refers only to selected records from a database: for
example, only selected customers from a company’s full customer list. In a
supermarket this may be product and sales summaries given to departmental
managers (bakery, fruit and vegetables, etc
.). Sampled information is often used
at a tactical level within an organisation. Depending on the size of the
organisation it may also be relevant at a strategic level.


Aggregated

This is information that consists of totals created when detailed informat
ion is
collated. An example of aggregated information is the details of all purchases
made by customers totalled each month and displayed in a chart showing total
sales for each month over a year.


In order to show all three types of information, here is a
n example that some of
you should be familiar with. In a league of teams who play each other twice in a
season, the
detailed
information would be the score line for each game played by
all the teams in the league.
Sampled

information would be the details f
or a team
in the league relating to their performance.
Aggregated

information would be the
goals for, goals against and goal difference for a team in a league.


Characteristics of information


Good information is that which is used and which creates value.

Experience and
research shows that good information has numerous qualities.


Good information is
relevant
for its purpose, sufficiently
accurate
for its purpose,
complete
enough for the problem,
reliable
and
targeted
to the right person. It is
also commun
icated
in time
for its purpose, contains the right level of detail and is
communicated by an appropriate channel, i.e. one that is
understandable
to the
user.


Further details of these characteristics related to organisational information for
decision
-
maki
ng follows.




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Data and information


Availability/accessibility

Information should be easy to obtain or access. Information kept in a book of
some kind is only available and easy to access if you have the book to hand. A
good example of availability is a
telephone directory, as every home has one for
its local area. It is probably the first place you look for a local number. But nobody
keeps the whole country’s telephone books so for numbers further afield you
probably phone a directory enquiry number. For

business premises, say for a
hotel in London, you would probably use the Internet.


Businesses used to keep customer details on a card
-
index system at the
customer’s branch. If the customer visited a different branch a telephone call
would be needed to ch
eck details. Now, with centralised computer systems,
businesses like banks and building societies can access any customer’s data
from any branch.


Accuracy

Information needs to be accurate enough for the use to which it is going to be
put. To obtain inform
ation that is 100% accurate is usually unrealistic as it is likely
to be too expensive to produce on time. The degree of accuracy depends upon
the circumstances. At operational levels information may need to be accurate to
the nearest penny


on a supermar
ket till receipt, for example. At tactical level
department heads may see weekly summaries correct to the nearest £100,
whereas at strategic level directors may look at comparing stores’ performances
over several months to the nearest £100,000 per month.


Accuracy is important. As an example, if government statistics based on the last
census wrongly show an increase in births within an area, plans may be made to
build schools and construction companies may invest in new housing
developments. In these cases
any investment may not be recouped.


Reliability or objectivity

Reliability deals with the truth of information or the objectivity with which it is
presented. You can only really use information confidently if you are sure of its
reliability and objectivit
y.


When researching for an essay in any subject, we might make straight for the
library to find a suitable book. We are reasonably confident that the information
found in a book, especially one that the library has purchased, is reliable and (in
the case
of factual information) objective. The book has been written and the
author’s name is usually printed for all to see. The publisher should have
employed an editor and an expert in the field to edit the book and question any
factual doubts they may have. In

short, much time and energy goes into
publishing a book and for that reason we can be reasonably confident that the
information is reliable and objective.


Compare that to finding information on the Internet where anybody can write
unedited and unverified

material and ‘publish’ it on the web. Unless you know
who the author is, or a reputable university or government agency backs up the
research, then you cannot be sure that the information is reliable. Some Internet
websites are like vanity publishing, whe
re anyone can write a book and pay
certain (vanity) publishers to publish it.




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Relevance/appropriateness

Information should be relevant to the purpose for which it is required. It must be
suitable. What is relevant for one manager m
ay not be relevant for another. The
user will become frustrated if information contains data irrelevant to the task in
hand.


For example, a market research company may give information on users’
perceptions of the
quality
of a product. This is not relevan
t for the manager who
wants to know opinions on
relative prices

of the product and its rivals. The
information gained would not be relevant to the purpose.


Completeness

Information should contain all the details required by the user. Otherwise, it may
not

be useful as the basis for making a decision. For example, if an organisation
is supplied with information regarding the costs of supplying a fleet of cars for the
sales force, and servicing and maintenance costs are not included, then a costing
based on
the information supplied will be considerably underestimated.


Ideally all the information needed for a particular decision should be available.
However, this rarely happens; good information is often incomplete. To meet
all
the needs of the situation, you

often have to collect it from a variety of sources.


Level of detail/conciseness

Information should be in a form that is short enough to allow for its examination
and use. There should be no extraneous information. For example, it is very
common practice
to summarise financial data and present this information, both
in the form of figures and by using a chart or graph. We would say that the graph
is more concise than the tables of figures as there is little or no extraneous
information in the graph or char
t. Clearly there is a trade
-
off between level of
detail and conciseness.


Presentation

The presentation of information is important to the user. Information can be more
easily assimilated if it is aesthetically pleasing. For example, a marketing report
tha
t includes graphs of statistics will be more concise as well as more
aesthetically pleasing to the users within the organisation. Many organisations
use presentation software and show summary information via a data projector.
These presentations have usual
ly been well thought out to be visually attractive
and to convey the correct amount of detail.


Timing

Information must be on time for the purpose for which it is required. Information
received too late will be irrelevant. For example, if you receive a bro
chure from a
theatre and notice there was a concert by your favourite band yesterday, then the
information is too late to be of use.




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Data and information


Value of information


The relative importance of information for decision
-
making can increase or
decrease its value to an organisation. For example, an organisation requires
information on a competitor’s performance that is critical to their own decision on
whether to invest in new machinery for their factory. The value of this information
would be hi
gh. Always keep in mind that information should be available on time,
within cost constraints and be legally obtained.


Cost of information


Information should be available within set cost levels that may vary dependent on
situation. If costs are too high
to obtain information an organisation may decide to
seek slightly less comprehensive information elsewhere. For example, an
organisation wants to commission a market survey on a new product. The survey
could cost more than the forecast initial profit from
the product. In that situation,
the organisation would probably decide that a less costly source of information
should be used, even if it may give inferior information.


The difference between value and cost


Many students in the past few years have confu
sed the definitions of value and
cost. Information gained or used by an organisation may have a great deal of
value
even if it may not have
cost
a lot. An example would be bookshops, who
have used technology for many years now, with microfiche giving way t
o
computers in the mid to late 1990s. Microfiche was quite expensive and what the
bookshops received was essentially a list of books in print. By searching their
microfiche by publisher they could tell you if a particular book was in print.
Eventually this

information became available on CD
-
ROM. Obviously this
information has value to the bookshops in that they can tell you whether or not
you can get the book. The cost of subscribing to microfiche was fairly high;
subscribing to the CD
-
ROM version only slig
htly less so.


Much more valuable is a stock system which can tell you instantly whether or not
the book is in stock, linked to an on
-
line system which can tell you if the book
exists, where it is available from, the cost and delivery time. This informatio
n has
far more value than the other two systems, but probably actually costs quite a bit
less. It is always up
-
to
-
date and stock levels are accurate.


We are so used to this system that we cannot envisage what frustrations and
inconvenience the older syste
ms gave. The new system is certainly value for
money.




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Data and information


Questions and tasks for data and information


1.

Describe the differences between data and information.


2


2.

(a) Explain the relationship between knowledge and


i
nformation.


1

(b) Explain the difference between explicit and implicit


2


knowledge, giving an example of each and of the


1


kind of information that made that knowledge possible.


3.

What is meant by metadata? Give an exampl
e of metadata.


2


4.

For each of the following situations say whether the information


is primary or secondary and internal or external.




the minutes of a golf club committee meeting



a till roll showing the day’s transactions in a corner s
hop



a university prospectus



the published accounts of a large public business.


4



5.

Describe the differences between:




formal and informal communication





2



quantitative and qualitative information.





2



6.

There are three levels of information, strategic, tactical and


operational. State the characteristics of:




information used for decision making at the strategic


level









2



information used for
decision making at the tactical


level









2




information used for decision making at the operational


level









2








7.


Explain the differences between information categorised by ti
me:




historically








1



in the present time







1



in the future








1




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Data and information


8.

Information can be used in planning, control and decision
-
making.



Describe how information
can be used in:




planning








1




control









1



decision
-
making.







1


9.

There are three forms of information, written, aural and visual.


Explain with the use of examples the difference between the


three forms.








3


10.

The type of i
nformation one may receive can be detailed, sampled

or aggregated. Explain the differences between the three types of

information with regard to the level of the information.



3


11.

For each of the following characteristics of information explain why

that c
haracteristic affects the quality of the information:


availability or accessibility accuracy

completeness

reliability or objectivity timing

conciseness

presentation

value









8


12.

Explain the distinction between value and the cost of information.

2


Tot
al marks for questions 44




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Data and information


Task for data and information


Imagine that a friend of yours would like you to use the Internet to find out about
university courses that he or she is interested in. They would like you to find out
which

universities offer Information Systems as a degree course in Scotland. But
before doing this you could use your knowledge of Information Systems to make
up a checklist of criteria you want to use in your search. There are two websites
you want to check ou
t, the UCAS site
(
www.ucas.ac.uk
)
and the Heriot Watt
University site
(
www.macs.hw.ac.uk
).
Complete the pro
-
forma below giving an
example in each case of either the information yo
u supply or that the website
supplies to you.


Nature of information

and criteria


www.ucas.co.uk


www.macs.hw.ac.uk

Data supplied

Information received



Knowledge gained



A
ny metadata?



Categorisation of

information in terms of:


(a) Source

(b) Nature

(c) Level

(d) Time

(e) Frequency

(f) Use

(g) Form

(h) Type



Comment on each of the

characteristics of the

information you have

found.


(a) Relevance

(b) Accuracy






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Data

and information


(c) Completeness

(d) Reliability

(e) Timing

(f) Conciseness

(g) Presentation

(h) Availability



Explain the difference

between the cost and

value of the information

found.






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SECTION 2


Organisational Information Systems


Categories

of information systems


An information system is a group of interrelated components that work to carry
out input, processing, storage, output and control actions in order to convert data
into information that can be used to support forecasting, planning,
control,
coordination, decision making and operational activities in an organisation.


There are several categories of information system:




Data Processing Systems (DPS)



Management Information Systems (MIS)



Decision Support Systems (DSS)



Executive Informat
ion System (EIS).


This table shows how they fit into the categories of strategic, tactical, and
operational information systems:


Organisation level

Type of information system

Strategic

Executive information system

Tactical

Decision support system

Man
agement information system

Operational

Data processing system


Data processing systems


Commercial computing systems were first developed in the 1950s and 60s,
initially by what can only be called enthusiasts consisting of businessmen with a
vision. Thes
e included Jo Lyon (of Lyon’s cakes fame) who operated a huge
catering empire in London in the 1940s and 50s. The story of how they became
computerised with the first commercial system is told at the site
ht
tp:// www.kzwp.
com/lyons/leo.htm.


These systems were data processing systems that either replaced the manual
clerical procedures currently in use (like bank records), or in new areas where
humans were unable to perform the calculations involved due to t
heir complexity.


A Data Processing System is sometimes referred to as a Transaction Processing
System (TPS), because it deals with the day
-
to
-
day transactions of an
organisation. Examples include systems for accountancy, invoicing, stock control
and data
entry. For example, a clerk processing a customer order needs to know
whether the item is in stock, what the price of the item is, as well as customer
details including name and address.




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Another example is each item
sold in a supermarket. For each item the bar code
would be scanned and used to find the name and the price of the product and
then the price used to calculate the total bill for a customer. This type of event
would be stored in the supermarket’s transactio
n file for each day’s business.


Data processing systems are usually tools used at the operational level of an
organisation, since most organisations at an operational level produce large
amounts of data from the events that contribute to their running.


A
nother simpler example of a DPS, within a school context, is the gathering of
pupil attendance records. Usually some attendance data is gathered for pupils in
a school, in the morning and afternoon. This data is then input into the
attendance information s
ystem. It can be used to calculate pupil, class, and year
-
group attendance percentages. Pupil support staff enquiring about pupil illness or
poor attendance can also use the information produced by this system.


A DPS usually involves a computer at the hea
rt of the operation. Depending on
the size of the company, this could be a desktop computer, a network, a mini or
mainframe computer with ‘dumb’ terminals. The system also includes the
software necessary to run the computer and handle the data. The means o
f
collecting and outputting the data may well also be included. For example, the
National Lottery DPS includes terminals in shops around the country where data
is collected.


Management information systems


An MIS is a system that converts data from intern
al and external sources into
information, communicated in an appropriate form to managers at different levels
of an organisation. The information can contribute to effective decision making or
planning to be carried out.


The source of data for an MIS usua
lly comes from numerous databases. These
databases are usually the data storage for Data Processing Systems.


MIS summarise and report on the organisation’s basic operations. The basic data
from the DPS is condensed and is usually presented in long reports

that are
produced on a regular basis.


MIS produce reports for managers interested in historic trends on a weekly,
monthly and yearly basis (not on the day
-
to
-
day activities of the DPS). The
information in these reports provides answers to routine pre
-
def
ined questions.
An example from a supermarket will provide reports that show the sales figures
for each department each day for a week, with weekly totals, monthly totals,
comparisons with last month and the corresponding month last year. Once the
informat
ion is in the system many reports can be extracted.


These systems are generally not very flexible and have little analytical capability.
Most MIS use simple routines such as summaries and comparisons as opposed
to sophisticated mathematical models or stat
istical techniques.




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Organisational Information Systems


Decision support systems


A DSS provides information and models in a form to help tactical and strategic
decision
-
making. DSS support management decision
-
making by integrating:




company performan
ce data



business rules in a decision table



analytical tools and models for forecasting and planning



a simple user interface to query the system.


DSS are particularly useful when making ad
-
hoc, one
-
off decisions. These types
of decisions tend to be unstruc
tured and irregular.


DSS enable a manager to explore a range of alternatives under a variety of
conditions. For example, a manager may wish to know the effects on profits if
sales increase and costs decrease.


The source of data for a DSS tends to be a co
mbination of summary information
gathered from lower level DPS and MIS; it also includes significant information
from external data sources.


Executive information system


An EIS provides senior managers with a system to assist in taking strategic and
tact
ical decisions. Its purpose is to analyse, compare and identify trends to help
the strategic direction of the organisation.


EIS address unstructured decisions and create a generalised computing and
communications environment, rather than providing any fix
ed application or
specific capability. Such systems are not designed to solve specific problems, but
to tackle a changing array of problems.


EIS are designed to incorporate data about external events, such as new tax
laws or competitors, and also draw sum
marised information from internal MIS
and DSS. These systems filter, compress, and track critical data; emphasising
the reduction of time and effort required to obtain information useful to strategic
management. They employ advanced graphics software to pr
ovide highly visual
and easy
-
to
-
use representations of complex information and current trends, but
they tend not to provide analytical models.




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EIS allow the user to look at specific data that has been summarised fro
m lower
levels within the organisation and then
drill down

to increase the level of detail,
which is provided by the information systems in different areas. This is an
example of data warehouse analysis, which we will discuss later.


Interrelationships be
tween information systems


Expert systems


An expert system is a computer program that tries to emulate human reasoning.
It does this by combining the knowledge of human experts and then, following a
set of rules, it draws inferences.


An expert system is
made up of three parts: a knowledge base; an inference
engine; a user interface.


The
knowledge base
stores all of the facts, rules and information needed to
represent the knowledge of the expert. The
inference engine
is the part of the
expert system that
interprets the rules and facts using backward and forward
chaining to find solutions to user queries. The
user interface
allows the user to
enter new knowledge and query the system.


Reasons for expert systems in business:



To store information in an active

form as organisational memory, creating an
organisational knowledge base that many employees can examine and
preserving expertise that might be lost when an acknowledged expert leaves
the organisation.




To create a mechanism that is not subject to human f
eelings, such as fatigue
and worry. This may be especially useful when jobs may be environmentally,
physically or mentally dangerous to humans. These systems may also be
useful advisers in times of crisis.




To enhance the organisation’s knowledge base by g
enerating solutions to
specific problems that are too substantial and complex to be analysed by
human beings in a short period of time.


We will go on to look at some of the concepts in relation to organisational
information systems. Also we will look at t
heir functions and at reasons for their
need, and at descriptions of management strategies and at networking.




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Higher


Questions on organisational information systems


1.

What is an information system?






1


2.

Describe t
he functions likely to be performed by a Data Processing

System, giving an example to illustrate your answer.



2


3.

Explain why a Data Processing System is classed as being

at the operational level of an organisation.


2



4.

For what purposes is a Management

Information System

usually used?









2


5.

Explain why a Management Information System is classed

as being at the tactical level of an organisation.




2


6.

Why would the management of a company like to see a

Decision Support System in place?






2



7.

Explain why a Decision Support System is classed as being

at the operational level of an organisation.


2


8.

Explain the purpose of an Executive Information System,

giving an example to illustrate your answer.


2


9.

Explain why an Exe
cutive Information System is classed as

being at the tactical level of an organisation.


2


10.

An Expert System is made up of three parts, a knowledge base,

an inference engine and a user interface. What is the purpose of

each of these three parts?







3


11.

Describe two reasons why an Expert System would be used

in business.









2


Total marks 22




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Concepts in relation to an Organisational Management System


Speed

Computers at the heart of in
formation systems are capable of processing data
very quickly. Although the computer is able to access data from backing storage
at very high speeds this is one of the slowest aspects of data processing. The
processor is able to carry out millions of calcu
lations per second and some
processors are optimised for speed of calculations.


Accuracy

For most practical purposes computers store and process numbers to a high
degree of accuracy, but the accuracy also depends on the software written and,
of course, on

human accuracy. Much financial software is accurate to 3 decimal
places rounded to 2. Once the accuracy of a calculation has been verified the
software and hardware combined will perform the calculation correctly every time.


Volume

The number of transact
ions handled by an Information System in a period of time
is referred to as the volume or number of transactions. A commercial data system
often has to handle millions of transactions every week. For example, take a bank
with 5 million customers. If each c
ustomer makes an average of 2 transactions
(cash withdrawals or deposits, cheques written, direct debits or standing orders),
then the system has dealt with 10 million transactions. The average for a bank of
that size is probably far higher so as you can s
ee the volume of data is huge.
This has big implications for the size of backing storage, processing power and
output capabilities of the system.


Efficiency

The efficiency of an Information System is really a combination of the speed,
accuracy and volume
of the data processed. It could be measured as the number
of accurate transactions carried out per minute. In relation to human processing,
it is substantially more efficient to carry out processing on an information system.
Information systems are capable

of running without interruption 24 hours a day
and 7 days a week.


The functions of an Organisational Information System


There are four basic functions of an OIS (similar in nature to the Commercial
Data Processing Cycle) relating to gathering data and s
toring, processing and
outputting information. Remember that we start by gathering
data,
and from
storing it onwards it becomes
information.


Gathering data

In the past there was a wide range of methods for capturing data before bar
codes became almost uni
versal on goods for sale. Many large companies
employed large teams of data
-
processing staff often entering data from
turnaround documents
(like utility bills filled in and returned with a cheque).



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The original mail
-
ord
er companies were another area of business that used data
-
processing staff. Customers chose goods from a catalogue and sent the order
forms in. Operators typed in the order, and when the goods were despatched
documents including a bill were produced. The c
ustomer received the goods and
in time paid the bill, filling in a document to enclose with the cheque (or to pay in
at the bank). The company eventually received the documents and the payment
could be recorded against the customer account.


In shops there

were several different ways of recording sales and stock control.
Some large shops used
kimball tags,
which were strips of cards with holes
punched in them. These cards were fed into a reader at the end of the day and
the reader interpreted the sequences
of holes as stock numbers and stored the
data on a type of disk. The disk was sent to head office for processing and at the
end of a week sales figures and stock levels could be calculated. A similar
system was employed with
metallic stripes
on the cards,
which were similarly
read and used.


The main disadvantage of these methods is the time delay between the goods
being ordered, dispatched (remember ‘please allow 28 days for delivery’) and the
company banking the money; also shops were forever either overs
tocking or
running out of stock.


The current methods that are employed to capture data for an information system
will be investigated.


Bar codes

Bar codes are small labels printed on food, books, newspapers and magazines
and nearly all product packages.
They are made of lines, which represent
numbers. A bar code stores four pieces of information:




country of origin



manufacturer’s code



item code



check digit.


The bar code is scanned (the numbers can be entered manually as well if they
won’t scan). The bar
code data is then used by the point
-
of
-
sale terminal to
search a database of products for the name and prices. It then prints an itemised
bill and uses the data to update stock levels and a sales file which can be used
there and then to calculate all sorts

of statistics (daily sales by department, hourly
sales, etc.).


Ordering goods

What are the other methods of gathering data in common use? Mail order has all
but disappeared and has been replaced by telephone and Internet ordering.
Companies now rely on c
ustomers telephoning an order and paying over the
phone with a credit or debit card. The goods are ordered instantly, the stock
position can be given to the customer instantly, the money is transferred to the
company’s account almost instantly, and the goo
ds are usually despatched within
a few hours and received usually within 48 hours by the customer.



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When goods are ordered over the Internet a similar situation occurs except that
even more of the process is automated.
The customer orders the goods from the
Internet site, pays by credit or debit card and the goods often arrive either at a
prearranged delivery time (supermarkets), or within a day or two.


The advantages of these methods to the company are that they are pa
id instantly
in advance for goods ordered and hopefully increase their business. To the
customer, goods are received very quickly and often at the customer’s
convenience and of course the customer does not need to leave their home
(especially advantageous
when young children are around and / or the weather is
very bad). The customer also has protection from their credit
-
card company if
something goes wrong.


Magnetic strips and chip and PIN

Credit and debit cards contain either magnetic strips or microchips

that contain
the holder’s account details. When the card is passed through the reader either
the strip or the chip is read and the account details transferred to the point
-
of
-
sale
terminal (POS).


With a magnetic strip card a bill is printed out, signed a
nd retained by the retailer
and a receipt is printed out for the customer.


With chip and pin the customer types a pin number into a device attached to the
till. The PIN number verifies the sale and the receipt is printed out for the
customer. It is genera
lly quicker to use chip and PIN and much less open to fraud
as there is no piece of paper for a thief to copy the number from.


Magnetic ink character recognition (MICR)

There are numbers printed at the foot of every cheque and on the slips in a pay
-
in boo
k. These are printed not in ordinary ink, but magnetic ink and are the code
numbers for the bank, branch, account and cheque. When the cheque is paid into
the bank, a machine is used to read the details, firstly on the pay
-
in slip that gives
the numbers fo
r the account the money is to go to, and then on the cheques that
give the numbers of the accounts the money is taken from. The bank clerk only
needs to type in the amount of each cheque and the reader sends all the details
to the branch computer that stor
es the data.


Optical character recognition (OCR)

This is when the printed text is scanned into a computer. Pages of text can be
scanned in very quickly and then searched for words or sentences. They can also
be reprinted or edited. It is very useful in an

office that receives or uses a lot of
printed text, e.g. lawyers or accountants.


Mark sense reader

This is a device which brushes electrical contacts across the Mark Sense
Document. If the contacts touch a pen or pencil mark then a current can flow
betwe
en them. This is used most commonly in the National Lottery, where a
player’s numbers are read from the board they have filled in and a ticket is
produced. This method is also used for marking multiple
-
choice question papers.


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ystems


Storing information

Information can be stored on a variety of media such as magnetic tape, hard disk,
CD
-
ROM and DVD. These fall into two categories, those where data can be
written to, re
-
written and amended, and those where data can only be writt
en
once and read many times. Generally speaking all of the data input from any of
the above methods of data input will be stored on hard disks. These have very
fast access allowing records on the disk to be accessed very quickly. The access
is also random
or direct meaning the disk heads can go to any part of the disk
without starting at the beginning and working through towards the end, as with
magnetic tape.


Generally tape is only used for backing up large hard disks and usually only file
-
servers on a ne
twork. It is totally unsuitable for most modern data
-
processing
applications. When fitted to a computer, CD
-
ROM and DVD drives that can be
written to are usually used for backing up data from the hard disk of a personal
computer.


Another popular device fo
r transporting data from one computer to another (home
to school or work and vice versa) is the
memory stick.
This small, large
-
capacity
device plugs into the USB port on the computer and almost immediately is
recognised by the computer as an external disk

drive and data can be saved to it
just like a disk, except that it can have a larger capacity and is a lot faster than a
disk drive.


Processing data


There are several types of processing that can be applied to data to turn it into
information, as follow
s:




searching/selection



sorting/rearranging



aggregating



performing calculations.


Searching involves selecting a sub
-
section of the data that meets a specified
criterion. You may be familiar with this technique from work you may have done
on databases in s
chool or college when results of searches or queries happened
instantaneously; but on a commercial basis searching can take a very long time.
One example would be the National Lottery where the winning numbers are
entered in as search criteria. On average
it takes half an hour to find the match
for any winning combination. Even if they find a match on the first record they
must continue to the end, as the last of around 14 million records could also be a
match. Every time a bar code is scanned the database
in the supermarket is
searched for a match and the details returned. Even with 20 or so tills working
and some 20,000 items in store the match is fairly instant.


I
nformation Systems Intermediate 2; Higher

Using Information

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© Lear
ning and Teaching Scotland

36

Organisational Information Systems


Sorting involves arranging the data into some form of or
der. The choices are
usually alphabetical or numeric, and then ascending or descending. Large
commercial organisations usually have their data sorted or indexed in some way.
It is common to have the customer file permanently sorted in customer number
order

and when transactions are made over the course of a day (orders and
payments usually), the transaction file is also sorted by customer number. The
files are then merged and a new file created with the transactions attached to the
correct customers. A bank

will sort its customers firstly into branches and then by
account number within the branch.


Aggregating involves summarising data by taking numerous data values and
reducing them to either one value or a substantially reduced number of data
values. Finan
cial data is often aggregated, as actual totals of money earned or
owed are wanted more often than the detail. For example, when you buy goods
in a shop or supermarket and pay for them you only pay the aggregated total and
if you pay by credit or debit car
d then the card company or bank is only interested
in the aggregated total to debit your account. When you receive the statement for
the credit card all the transactions you have made are listed on the statement but
you are only really interested in the ag
gregated total at the bottom


the amount
you have to pay.


Performing calculations involves applying a formula to data to compute a new
value. Obviously when using examples looked at in this section, calculations
have taken place. The items have been tota
lled or added up; and the total found
for the till receipt, the bank and credit card statements have been similarly
totalled. When a utility bill is calculated then several calculations take place:


Cost of units = units used * unit cost

Net bill = cost of

units + standing charge

Total bill = net bill + (net bill * 0.175)


So the total bill is calculated in three stages with the VAT finally being added. The
same principles apply for electricity, gas and phone bills, although the phone bill
has many more su
b
-
sections and performs many more calculations.


Outputting information


Paper

The most popular output method is printing information onto paper. The list of
examples of paper output is almost endless, but tying them in to our examples we
include till rece
ipts and bills of many kinds to customers; in a business we call
these invoices and statements. Internal reports and business communications
tend to be internal printed output within a business, while many businesses exist
to produce printed output to send

to customers and potential customers.


Screen

Often in a large data processing operation the operator is only allowed to see
their input screen and maybe some customer details. Managers and directors are
more likely to see reports and progress checks on s
creen. However, with the rise
of web
-
based and web
-
aware software, management reports can be viewed on
screen in an interesting and visually stimulating manner, as with intranet pages