Information (data which has been processed & is useful to human beings) has become an important commodity. Organisations use it to increase productivity, deliver products and services, and to make decisions. Information systems are continuing to transform and are becoming more and more useful to business organisations.
The major roles of Information Systems in business organisations are to:
- Support Business Processes & Operations:
This is the first level- the strategic level. Information Systems help business operations and processes.
For example Information Systems are used to track merchandise, for employees signing in and out (in some organizations), to pay employees based on the number of hours of work recorded and also with consumers. Businesses can record consumer purchases and with the use of loyalty cards have direct communication with consumers.
- Support Managerial Decision Making:
This is the next level- the tactical level. Information Systems help managers in making decisions about the business based on information gathered within the information systems.
For example IS logs purchases and highlights which items might be selling better than others- that may need to be ordered more regularly for example, but also if some products aren’t selling very well they may need to discontinue them.
- Support Strategic Advantage:
Lastly- the strategic level. Information Systems help Top Management in making decisions to help the company move forward.
For example head office might use system to look at sales trends across stores to identify ways to gain competitive advantage over other retailers.