Types of Information System

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For most businesses, there are a variety of requirements for information. Senior managers need information to help with their business planning. Middle management need more detailed information to help them monitor and control business activities. Employees with operational roles need information to help them carry out their duties.

As a result, businesses tend to have several "information systems" operating at the same time. This revision note highlights the main categories of information system and provides some examples to help you distinguish between them.

The main kinds of information systems in business are described briefly below:

Executive Support System
An Executive Support System ("ESS") is designed to help senior management make strategic decisions. It gathers, analyses and summarises the key internal and external information used in the business.






Management Information Systems
A management information system ("MIS") is mainly concerned with internal sources of information. MIS usually take data from the transaction processing systems (see below) and summarise it into a series of management reports.
MIS reports tend to be used by middle management and operational supervisors.


Decision-Support Systems
Decision-support systems ("DSS") are specifically designed to help management make decisions in situations where there is uncertainty about the possible outcomes of those decisions. DSS comprise tools and techniques to help gather relevant information and analyse the options and alternatives.


Knowledge Management Systems
Knowledge Management Systems ("KMS") exist to help businesses create and share information. These are typically used in a business where employees create new knowledge and expertise - which can then be shared by other people in the organisation to create further commercial opportunities. Good examples include firms of lawyers, accountants and management consultants.


Transaction Processing Systems
As the name implies, Transaction Processing Systems ("TPS") are designed to process routine transactions efficiently and accurately. A business will have several (sometimes many) TPS; for example:
- Billing systems to send invoices to customers- Systems to calculate the weekly and monthly payroll and tax payments- Production and purchasing systems to calculate raw material requirements- Stock control systems to process all movements into, within and out of the business


Office Automation Systems
Office Automation Systems are systems that try to improve the productivity of employees who need to process data and information. Perhaps the best example is the wide range of software systems that exist to improve the productivity of employees working in an office (e.g. Microsoft Office XP) or systems that allow employees to work from home or whilst on the move.