What Are Specialized Information Systems? - Decision Support Systems for Business

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  • 0:08 Specialized…
  • 2:32 Types
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Lesson Transcript
Instructor: Paul Zandbergen

Paul has a PhD from the University of British Columbia and has taught Geographic Information Systems, statistics and computer programming for 15 years.

Specialized information systems have been developed to support decision making in an increasingly complex world. Learn about some of the different types of specialized information systems.

Specialized Information Systems

An information system is a collection of software, hardware, procedures, data and computer networks used by people in organizations. An information system is used to collect, store, manage and distribute data to support specific activities. As organizations and their activities have grown more complex, specialized information systems have emerged.

Some of this specialization is due to the nature of organizations. For example, an information system that works well to maintain a library catalog may not be the best to keep track of the inventory of a supermarket - even though the activities may share some similarities. While both systems need to keep track of specific items, the types of items are very different.

In a library catalog, you need to keep track of individual books. In a supermarket inventory, you want to know how many pounds of golden delicious apples are still in stock, but you don't need to keep track of individual apples since they're all the same. You can probably think of other ways in which libraries and supermarkets are different.

A single organization may use a number of different information systems. Consider the supermarket example. A single supermarket will have some type of inventory system, which keeps track of what is in stock, what is sold every day and what is being delivered. This inventory system is linked to a transaction system of actual sales at individual registers.

The store manager also needs to keep a scheduling system to organize the working hours of employees. If the supermarket is part of a chain, there will be other information systems at a different level. Senior management may want to know how stores in specific markets are doing or where to plan for a new store.

Think of all the decisions being made just within the supermarket chain. How many cartons of milk to buy? How many cash registers to open up on Saturday morning? When to put the potato chips on sale and at what price? How much to spend on advertising? Thousands of decisions are made every day. Almost all these decisions require information, and most organizations have become very reliant on information systems to support their decision making.

Types of Specialized Information Systems

Let's look at some examples of specialized information systems used in organizations. Management Information Systems, or MIS, are computer-based systems that provide managers with the tools to run their department. Relative to other types of specialized information systems, MIS is used by mid-level management to support ongoing operations. For example, an MIS could provide a manager with real-time information on customer orders, customer complaints, sales and production cycles. In the case of the supermarket, an inventory system for use by the store manager would be an example of an MIS.

A Decision Support System, or DSS, is a specialized information system designed to facilitate the decision-making process in organizations. It provides a framework to gather information from internal and external sources to support decision making. There are many different kinds of decision support systems, but in general, they are used for problems that are less structured.

So, while an MIS is used for routine decisions, a DSS is often used when the circumstances are not well defined or are unpredictable. In the case of a supermarket, an example of a DSS would be a system for how to handle an emergency, such as a flood. Quick decisions without complete information will be necessary, and this is not something all the employees will have to deal with on a daily basis.

An Executive Information System, or EIS, is a specialized DSS for senior management and executives. It combines information from various units in the organization to provide a strategic overview. This is often in the form of an executive dashboard that shows key performance indicators.

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