What is the role of information system in organization?

Table of Contents Show

The Basics of Information Systems
Key Ways Information Systems Assist Organizations
Go Graduate: The Possibilities of a Master's in Information Systems
Are you interested in IT information systems?
Data, Information, Knowledge, & Wisdom
Information

Every organization, whether it is a corner retail shop or a multi-national non-profit organization, stands to benefit from information systems. Information systems offer a way for organizations of all shapes, sizes, and niches to store key information and then use that information to make important decisions using real data.

If you already work in the IT industry, then you likely already know the importance of information systems and why it often makes solid sense to go back to school to obtain your Master's Degree in Information Systems. But if you are new to this sector of technology, then consider the following short article about information systems, their vital importance to organizations, and why a graduate-level education can help you reach your goals.

The Basics of Information Systems

The term information system refers to any collection of equipment that makes it possible for an individual or organization to organize and analyze data. This means that the purpose of an information system is to collect raw data and transform it into useful information that an individual or larger entity can then use for decision making.

A great example of a commonly implemented business information system is a customer relationship management. Customer relationship management (CRM) systems are designed to accumulate and track consumer activities such as how they first interacted with the brand, overall purchasing trends, customer inquiries, and much more.

A robust CRM will both collect this data and then offer easy capabilities for businesses and organizations to analyze that data and make key marketing and business decisions off that data. For example, if a CRM shows a particularly strong response to a specific YouTube ad, the advertising and marketing department will likely focus on what made such a video successful, and repeat the endeavor on a broader scale.

Key Ways Information Systems Assist Organizations

Seamless communication: A key component of organizational leadership and management is gathering and distributing information so that every position has the things they need to succeed in their company role. Information systems assist in disseminating information by allowing managers and other organization leaders to store data in folders and documents that can be seamlessly shared with the appropriate employees. Most information systems also allow users to communicate remotely so that no matter where an employee is, they can receive information and react accordingly.
More efficient operations management: Information systems enable organizations to collect and access recent information, as well as keep a comprehensive collection of all organization data. Combined, this enables businesses to operate more efficiently, as things like real-time sales data offer insights into immediate customer purchases to inform better stocking or production practices.
Better record keeping: No matter what industry an organization is in, efficient record keeping is necessary. There are industry regulations that need to be adhered to and recorded proof those regulations have been adhered to. Then there is the long list of different financial records that are a component of every business. Information systems make record keeping easier, faster, and more accurate with features that enable document storage, revision histories, communication records, and other aspects of operational data. This type of record keeping is not just useful for ensuring an organization stays within the necessary regulatory and financial lines, but it also assists business leaders in preparing cost estimates and making better forecasts to understand how certain past actions influenced operations.
More informed decision-making: This point bears repeating, as frequently information systems are used to inform the decision-making processes that can make or break an organization. Organization and business leaders need the most accurate, up-to-date information if they are to make the best decisions for the future of their group. Information systems not only offer past trends, but they also offer real-time business information which can be set to forecast future possibilities. Business leaders need all of the above in order to make the right decisions that will enable their organization to thrive.

Go Graduate: The Possibilities of a Master's in Information Systems

Every business, every nonprofit organization, every government entity can benefit from the implementation of an information system. That said, information itself has no value if it cannot be appropriately organized. IT professionals who pursue a Master's Degree in Information Services could learn how to both create and manage information systems that will best enable specific groups to find and store data that is useful for their industry or operations niche. Students of a graduate-level program learn how to manage various existing information systems to best serve the needs of their future managers, employees, and customers.

Are you interested in IT information systems?

If so, a Master of Science in Information Systems might be right for you. ECPI University offers this program at an accelerated pace. Meaning you could graduate in as little as 15 months. For more information about this exciting degree, connect with a friendly admissions advisor today.

It could be the Best Decision You Ever Make!

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The goal of an information system is to transform data into information in order to generate knowledge that can be used for decision making. In order for information to add value to a business and the decision maker it must possess characteristics to ensure quality. The following characteristics are necessary to add value.

Data Properties

Accessible	Must be easily accessible by users to meet their needs in the right format at the right time. Access should be secure and prevent unauthorized access.
Consistent	Contains no discrepancies, and the same measurements or structure are used regardless of the data source.
Complete	Contains all information and is not missing anything.
Timely	Delivered when needed.
Accurate	Free of errors and bias, and can be verified or validated.
Cost	Balance the value of information to the cost of producing it.
Relevant	Important to decision makers.
Clear	Not overly complex, easy to understand.

The terms information and knowledge are sometimes used interchangeably. What is the difference between data, information and knowledge?

Data, Information, Knowledge, & Wisdom

DIKW Pyramid

Data

Data are the raw facts, and may be devoid of context or intent. For example, a sales order is a piece of data. Data can be quantitative or qualitative. Quantitative data is numeric, the result of a measurement, count, or some other mathematical calculation. Qualitative data is descriptive. “Ruby Red,” the color of a 2013 Ford Focus, is an example of qualitative data. A number can be qualitative too: if I tell you my favorite number is 5, that is qualitative data because it is descriptive, not the result of a measurement or mathematical calculation.

Information

Information is processed data that possess context, relevance, and purpose. For example, monthly sales calculated from the collected daily sales data for the past year are information. Information typically involves the manipulation of raw data to obtain an indication of magnitude, trends, in patterns in the data for a purpose.

As an example, suppose that you want to know how you’re doing in a particular course. So far, you’ve taken two 20-question multiple-choice tests. On the first, you got questions 8, 11, and 14 wrong; on the second, you did worse, missing items 7, 15, 16, and 19. The items that you got wrong are merely data—unprocessed facts. What’s important is your total score. You scored 85 on the first exam and 80 on the second. These two numbers constitute information—data that have been processed, or turned into some useful form. Knowing the questions that you missed simply supplied you with some data for calculating your scores.

Now let’s fast-forward to the end of the semester. At this point, in addition to taking the two tests, you’ve written two papers and taken a final. You scored a 90 and 95 on the papers and a 90 on the final. You now have more processed data, but you still want to organize them into more useful information. What you want to know is your average grade for the semester. To get the information you want, you need yet more data—namely, the weight assigned to each graded item. Fortunately, you’ve known from day one that each test counts 20 percent, each paper 10 percent, and the final exam 40 percent. A little math reveals an average grade of 87.

Though this is the information you are interested in, it may be mere data to your instructor, who may want different information: for example, the average grade for the entire class. The moral of the story is that what constitutes information at one stage can easily become data at another, and one person’s information can be another person’s data.

Knowledge

Knowledge in a certain area is human beliefs or perceptions about relationships among facts or concepts relevant to that area. For example, the conceived relationship between the quality of goods and the sales is knowledge. Knowledge can be viewed as information that facilitates action.

Once we have put our data into context, aggregated and analyzed it, we can use it to make decisions for our organization. We can say that this consumption of information produces knowledge. This knowledge can be used to make decisions, set policies, and even spark innovation.

Explicit knowledge typically refers to knowledge that can be expressed into words or numbers. In contrast, tacit knowledge includes insights and intuitions, and is difficult to transfer to another person by means of simple communications. Evidently, when information or explicit knowledge is captured and stored in computer, it would become data if the context or intent is devoid.

Wisdom

We can say that someone has wisdom when they can combine their knowledge and experience to produce a deeper understanding of a topic. It often takes many years to develop wisdom on a particular topic, and requires patience.