Information Systems And Its Effects On Business Essay

Length: 6 pages Sources: 3 Subject: Business - Management Type: Essay Paper: #75689548 Related Topics: Management Information Systems, Management Information System, Accounting Information Systems, Information Systems
Excerpt from Essay :

¶ … information systems and its effects on business processes. Moreover, I have explained the several business components and their effectiveness as information systems. In addition, I have provided information regarding the effects of information systems on various business careers.

Information systems have brought revolutions and innovations in today's business' setups and also have developed a close relationship with globalization. The responsibility of these information systems in an organization is not to support the tasks of the individuals but to support business functions as a whole. Nowadays, business operations are conducted by using e-mail, online conferences (video/audio) and cell phones which have turned out to be the most fundamental tools in business execution. Information systems, if truth be told, are the basis of accelerating supply chains. The businesses today have the advantage of using internet for purchasing, selling, advertising and imploring the feedbacks from consumers/customers online. It is now the purpose of every organization, big or small, to try to develop and grow as more viable, well-organized and proficient by making it possible for its core business processes become digital, thus trying to enable itself to become a digital firm. As far as globalization is concerned, this phenomenon has been stimulated by the Internet as one can observe the dramatic changes in the reduction of production, purchase and trade expenses of goods on an international level (Laudon, Laudon & Dass, 2010). In the contemporary world, "mobile digital platform, online software as a service, and cloud computing" (Laudon, Laudon & Dass, 2010) have come into view as modern information system trends. Thus, the information systems have transformed the operations, products and services of today's business world by introducing wireless technology that has catalyzed the media and advertising trends innovatively and by also amending federal security and laws pertaining to accounting.

The information systems have become indispensable for running, organizing and managing businesses in today's modern era. It wouldn't be incorrect to say that information systems have come out as the foundation for the performance and accomplishment of business tasks. Today, it is not possible for companies to ignore the importance of information systems as these systems help businesses to survive and enable them to achieve their goals immensely. The success of a business today is dependent on the wide-ranging use of information systems. There are 6 major objectives that businesses today seek to acquire by using information technology. Those six goals are "operational excellence; new products, services, and business models; customer/supplier intimacy; improved decision making; competitive advantage and day-to-day survival" (Laudon, Laudon & Dass, 2010).

The use of information technology is important for business operations as it improves the competency level and effectiveness to acquire higher profits. The new technological innovations in information management systems have paved the way for new products, better services and efficient business models. The understanding and relationship between the consumers and suppliers have also improved due to information systems as the companies generate profits by serving customers in an appropriate and likable manner. For customers, information technology helps in lowering the costs due to rapid and effective communication. As the customers and suppliers both have access to data due to information systems, it leads them to make better decisions. Moreover, the information systems have helped and are helping companies to gain competitive advantage by enabling them to deliver a high-quality performance (selling superior products for less charges and communicating with customers in no time).

As far as the information system is concerned, it works in several ways and has different managerial, organizational and technological components. If seen from a technical point-of-view, an information system is used for the gathering, storage and distribution of information from an organization's atmosphere and internal processing systems for supporting "organizational functions and decision making, communication, coordination, control, analysis and visualization" (Laudon, Laudon & Dass, 2010). By employing input, processing and output as three fundamental activities, the raw data is being transformed into valuable information by information systems (Laudon, Laudon & Dass, 2010). The activity of input is used for capturing raw data from both internal and external settings....


After the capturing of the required information, processing is employed for the conversion of raw data into information that has some significance. Last of all, output process is used for the transference of the processed information to the departments (employees) or activities that make use of the obtained information (Chatterjee, 2010).

On the other hand, if information system is seen from a business point-of-view, the information systems is a set of interconnected components that are used for providing solutions to the different problems that are faced by the businesses as these systems are composed of a number of supervision, organization, and technology components. The management aspect of such systems is comprised of important subjects like headship, policies/strategies and management manners/conduct. On the other hand, organization aspect of these systems include concerns like the chain of command of the organization, functional areas of expertise, course of action, environment and atmosphere of the workplace etc. (Laudon, Laudon & Dass, 2010). Last but not the least, the technological aspect of the information systems includes "computer hardware, software, data management technology, and networking/telecommunications technology (including the Internet)" (Laudon, Laudon & Dass, 2010).

Any information system-relations problem in a business can be solved by a four-step method. These methods are problem identification, solution design, choice and implementation. The keys to develop an efficient information system are excellent decision making and reliable problem-solving skills. An organization cannot do without an efficient decision making and problem solving system if it wants to accomplish its goals. The process of problem-solving involves the usage of information, data and sixth sense to solve a previously-identified problem. This process starts with decision making that can be further divided into four stages i.e. intelligence, design, choice and implementation (Alter, 2002).

Intelligence consists of the gathering and evaluation of facts and figures that are related to the already-identified problem. The major challenges in this stage include the acquisition of entire and exact information and working out what this obtained information means for the decision in sight. The design phase consists of the study of the problem methodically, alternatives' establishment and assessment of outcomes (Alter, 2002). The major challenges of this stage involve "bounding the problem to make it manageable, creating real alternatives, and developing criteria and models for evaluating the alternatives" (Alter, 2002). The phase of choice involves the selection of the alternative that has a preference. Here, the main challenges include squaring off of the contradictory purposes and concerns, amalgamation of ambiguities and management of processes that require group decisions. The last phase of implementation involves the enforcement of decision. This phase consists of communicating to the concerned people and explaining the decision to them, reiterating the sense behind the decision and confirmation to follow the decision. The critical challenges of this last phase involves the guarantee that the decisions and its consequences have been understood by the concerned people and the assurance that everyone will follow the decision even if he/she doesn't agree with it (Alter, 2002).

Manufacturing, sales and marketing, human resources and finance are the major components of a business that are significant for understanding the role of information systems. The manufacturing involves the production of products and services. The advertising and promotion of the services/products is the responsibility of sales and marketing. The human resources are responsible for catching the attention of consumers, developing and maintaining the workforce of the organization and keeping track of their records. The financial assets of the organization are managed by the finance and accounting departments. Thus, if information systems are to be understood, it is first essential to have know-how of the mentioned business' components (Laudon, Laudon & Dass, 2010).

The information systems are also useful for different levels of the organization and are thus helpful in supporting the basic functional components of the business. The sales and marketing systems are helpful for the business or organization as they identify the potential consumers/customers for the services/products that are offered. They are also involved in the development of the services and products for meeting the needs and demands of the customers. They are also engaged in the promotion, advertising and selling of the products/services. Last but not the least, these systems are usually available 24/7 for answering any queries of the consumer. As far as manufacturing and production systems are concerned, they take initiatives to prepare, develop and manufacture products and services and also are in command of production flow. Finance and accounting systems maintain the records of the organization's monetary resources and fund flows (Laudon, Laudon & Dass, 2010). Human resources systems provide assistance to the employees related to "recruitment, placement, performance evaluation, compensation and career development" (Lucey, 2005).

The information systems also have a direct influence on business careers. Therefore, it is important for the employees today to acquire information systems skills and knowledge to secure their jobs and work in an efficient and competent manner. For example, as far as the job of…

Sources Used in Documents:


Alter, S. (2002). Information Systems: Foundation of E-Business, 4/e (4th ed.). New Delhi, India: Dorling Kindersley (India) Pvt. Ltd. Retrieved February 15, 2013, from

Chatterjee, I. (2010). Management Information Systems. Delhi, India: PHI Learning Private Limited. Retrieved February 15, 2013, from

Laudon, K., Laudon, J., & Dass, R. (2010). Management Information Systems: Managing the Digital Firm (11th ed.). Chennai: Dorling Kindersley (India) Pvt. Ltd. Retrieved February 15, 2013, from,+11/E&hl=en&sa=X&ei=KM0dUcjxNOW00QXAtIH4Bg&ved=0CC0Q6AEwAA

Lucey, T. (2005). Management Information System (9th ed.). Croatia: Thomson Learning. Retrieved February 15, 2013, from

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