Components of Management Information System

At various levels in the organization, managers require and use information systems to make decisions and handle day-to-day operations of the firm. There are five basic types of information systems such as- Transaction Processing System, Office Automation System, Decision Support System, Executive Support System and Management Information System. Here is brief information about each of these information systems.

Transaction Processing Systems

Transaction processing system or TPS is computer based. It handles, executes and records every day transactions, and routine activities in an organization. These transactions are important for the organization's business activities. Highly organized, structured organizations use the TPS where there are repetitive situations.

A transaction processing system also helps the organization by storing the various transaction data, filtering or sorting, sequencing, updating and arranging records, merging contents of files, performing data calculations, data sorting and listing data for the use of employees.

Office Automation Systems

Office automation system or OAS is a system based on computers. It eases the process of communication across different departments in the organization. Moreover, OAS also improves the employee productivity via the use of automation in the routine process of documentation and messaging.


Office Automation Systems make use of different applications like-

Electronic Calendars to maintain electronic schedules of appointments in an organization
Voice Mails to record and store phone calls and messages in a computer memory to retrieve later.
Groupware to organize and schedule meetings using a software program
Teleconference system to allow oral and video communication among teams and employees across different geographical locations.
Facsimile Transmission helps to exchange documents and written information. This process uses a telephone fax to print and send documents to different locations instantly.
Graphics is another automation system that allows conversion of regular data into digital format and images.

Decision Support System

Decision support system or DSS is an interactive computer technology system that helps managers to make decisions easily. With DSS, managers get an access to important data in the form of charts, graphs and tables. Hence, it becomes easy to analyze information using such charts and tables. DSS uses the information obtained from office automation and transaction processing systems in case of complex decision-making activities.

Elements of DSS

A typical DSS uses various methodologies to access and summarize data. It also uses a sophisticated information database. The interface of a DSS is user-friendly and requires simple commands and not complex technical jargon. Hence, people with basic computer familiarity can operate and use a DSS or decision support system. A DSS database contains information taken from both internal and external sources. Hence, managers can easily analyze both sources for making good decisions. Thus, Rapid response time is the main advantage and rewarding factor for using a DSS.

Executive Support Systems

Executive Support System or ESS is also a computer information system. The top-level management uses the ESS to make decisions in an organization. Executive support system is more effective since it provides higher computer capability, better telecommunication facility and display. ESS uses less analytical methods, provides information from multiple sources and is an interacting medium to solve general problems. Essential elements provided by an executive support system are market intelligence, investment intelligence and technology intelligence. Moreover, it is possible to customize an executive support system to suit the needs of the executives for various working conditions.