Course sections

Theme-3: Innovation, Strategic and Project Management

Course-2: Management Information System Theory Module

Unit 1: An Overview of Management Information System


  • Aims and Objectives
    • Introduction
    • The Evolution of Information System
    • Definition of Basic Concepts
    • The Purpose of Information Technology
    • Users of Information
    • The Process of Generation of Information
    • The Attributes of Information
    • Feature of Information
    • Systems
    • Subsystems of an MIS
    • Summary
    • Answer Key to Check Your Progress Exercise

1.     Aims and Objectives

After studying this unit, the student should be able to:

  • explain the development of information system
  • define management, information, system and finally management information system
  • understand the impact of information technology
  • explain the purpose of information technology
  • describe the features of information

1.1 Introduction

A number of trends affect today’s business environment. One of them is the transition from an industrial economy to an information services economy. Beginning with the industrial revolution, productivity gains in the westerns economy were tied to industrial production and manufacturing of goods and services. Since the 1960s, 50 percent of all productivity gains have been attributable to the use of information technology. The ability to capture, store, process, and distribute information is critical to most organization.

Today, the traditional organization is being transformed in to the information based organization, which uses information and information technology to produce significant changes in work patterns. The organization of the past was highly structured and composed of many different functions. In this type of organization, each unit maintained its own information. The organization of the future will have a flexible, changeable structure. Teams consisting of specialists from various functional areas will work together on projects that address new market opportunities. Shared information data bases will link individuals to each other. In the future, manager in the information based organization will become responsible for using and managing technology. They will use information technology (IT) as a tool to provide effective customer service, analyze market opportunities, and manage production and manufacturing operations. IT will become an integral part of business. To understand the information based company of the future, let’s first learn why traditional organizations are evolving into information based organizations.

1.2 The Evolution of Information Technology

Historically, organizations have become hierarchies of complex functions over time. One of the fundamental principles influencing the evolution of industrial organizations was specialization of labor. The division of labor led to the fragmentation of work, with workers in many different areas – marketing, manufacturing, accounting, and so on – performing specialized tasks.

A second factor in the development of modern organizations is the command-and-control structure that can be traced back to early railroad companies, which required predictable, safe control systems. Today’s business bureaucracy, with its formalized operating procedures and formal lines of authority, evolved from these early railroad organizations. The standard pyramid, with work broken down by departments – each with its own budget and control systems – is still a common organizational form today.

The third factor influencing the performance of modern organizations was the nature of the post-World War II market: It was a seller’s market. Given the unrelenting demand for goods and services, customers were willing to buy anything that was available. Customer service was not necessarily a critical success factor.

In the 1990s, the nature of the market has changed. Customers have power over suppliers that they didn’t have before. Part of this customer power comes from access to information. When prospective car buyers can look up dealer invoice cost on a new auto in Consumer Reports, they gain new leverage over the dealer.

Information technology provides a means to focus on the customer. By carefully tracing and analyzing customer buying behavior, companies like Wal-Mart can allocate inventory to meet customer needs. They can also use information technology to provide better customer service. Some companies have a customer service network that route customer calls to the same service representative again and again, thus creating a sense of personal service. Other companies use a service management network to provide on-line technical service for large number of services. When a support call is dispatched to service technicians, the system automatically provides data on the maintenance history of a particular service area. Many microcomputer vendors give their customers access to bulletin board systems that provide up-to-date technical information on product features.

Finally, information technology is transforming the scope of doing business. Worldwide communications networks enable businesses to operate in global markets and to reach new customers. Information technology also makes it possible to do business 24 a day. Individuals on project teams may work in distant locations and interact using electronic communication networks and videoconferencing facilities.

1.3 Definition of Basic Concepts


Management has been defined in a variety of ways, but for our purposes it comprises the process of activities that describe what managers do in the operation of their organization: plan, organize, initiate, and control operations. They plan by setting strategies and goals and selecting the best course of action to achieve the plan. They organize the tasks necessary for the operational plan, set these tasks up into homogeneous groups, and assign authority delegation. They control the performance of the work by setting performance standards and avoiding deviations from standard.

Because decision making is such a fundamental prerequisite to each of the foregoing processes, the job of an MIS becomes that of facilitating decisions necessary for planning, organizing, and controlling the work and functions of the business.


Data must be distinguished from information, and this distinction is clear and important for our purpose. Data are facts and figures that are not currently being used in a decision process and usually take the form of historical records that are recorded and field without immediate intent to retrieve for decision-making.

Data are collections of facts or events represented in the form of symbols, such as digits, alphabets, pictures, graphs, etc. Capturing, processing and storage of data are the essential functions of any IT infrastructure. Data are the basic raw materials in the process of generation of information. Data may be collected from internal sources as well as external sources.

Information consists of data that have been retrieved, processed, or otherwise used for informative or inference purposes, argument, or as a basis for forecasting or decision-making.

Information is knowledge that one derives from facts placed in the right context with the purpose of reducing uncertainty. From the manager’s point of view, information serves the purpose or reducing uncertainty regarding the alternative course of action, in the process of decision-making. Availability of information regarding the alternative improves the odds in favor of making a correct decision. Information is recognized as one of the most important corporate resources.

1.4 The Purpose of Information Technology

This section provides a framework for determining the applications of information technology that will help you identify applications that have an impact upon the individual, the functional unit, and the organization as a whole. These applications can be placed into three categories: those designed to improve efficiency, those designed to improve effectiveness, and those designed to facilitate transformation.

Efficiency: can be defined as doing things right. An efficient office worker, for example, can update hundreds of documents per hour. An effective information system can update thousands of employees or student records per minute. Historically, computer based information processing systems have supported efficiency by automating routine paperwork processing tasks.

Effectiveness: can be defined as doing the right things. This means doing the things that need to be done to achieve important business results. An effective sales manager, for example focuses on tasks that payoff in increased sales volume. Information systems can help managers be more effective. For example, a prospect database housed on a PC may enable a sales manager to identify sales prospects with high potential and direct his staff’s attention to contacting those prospects.

The third objective of applying information technology is transformation. Using information technology to change the way you do business. This may mean changing the nature of the product or service being delivered or entirely transforming the way business is done in a functional unit of the whole organization.

Next we will consider how applications that achieve the objectives of efficiency, effectiveness, and transformation affect the individual, the functional unit, and the organization as a whole. The table below summarizes these objectives.

Impact on the Individual

At the individual level, applications of information technology impact efficiency, effectiveness, and transformation. An individual can use a work-processing program, for example, to automate retyping letters. A manager can use a spreadsheet to automate routine budget calculations. These applications are designed to improve efficiency by providing automated tools to support specific tasks.

Other applications improve the effectiveness of the secretary or manager. If a secretary uses a prospect database to merge prospect data with follow up letters on sales calls, the combination word processing – database application improves effectiveness because these letters can improve sales – a fundamental objective of the business.

In some ways, transformation is the most challenging outcome of information technology. By using a portable personal computer, a manager can perform “what-if” analyses for investment prospects during sales calls. A prospective customer, for example, may be weighing the advantages and disadvantages of alternative investment options – say, in stocks, bonds, and mutual funds. Sitting in the customer’s living room with a PC in hand, the salesperson can compare the anticipated yields on different investment alternatives and give the customer a much better idea of the potential returns on different programs. This capability changes the way the salesperson sells investments. This is an example of transformation. The table below summarizes applications of information technology that impact the individual.

A framework for applications of information technology

Applications impacting the individual

Impact on the Functional Unit

Applications that automate specific business processes, such as order entry or credit checking, are examples of information technology’s impact on the efficiency of the business function. Automated order processing and inventory control systems are other examples of these applications.

An example of an application that improves the effectiveness of the functional unit is using computer-aided design to improve the quality of the design of shoes, automobiles, or airplanes. Improved designs may lead to better sales.

Finally, information technology can transform the nature of the product or service the functional unit offers. A publishing company may sell business research information on CD-ROM disks. These disks provide access to enormous volumes of business information via PC. Hence, this new technology has produced an altogether new product line. Table below summarizes applications affecting the functional unit.

Impact on the Organization

The last group of applications of information technology has an impact on the organization as a whole. Linking customers to the order entry system of a supplier can improve efficiency. For example, furniture retailers can use terminals linked to the order entry system of a furniture retailers can use terminals linked to the order entry system of a furniture manufacturer to place orders, check on prices and delivery dates, and manage their own inventories. This system improves the efficiency of placing orders by cutting down on paperwork and enabling retailers to check on available stock before placing orders. The system also gives the furniture manufacturer a competitive advantage because it links customers electronically to the order entry system, making it easier to place orders with this manufacturer than with other suppliers. The second objective of information technology is effectiveness. The organization can be more effective by providing better service to its customers.

Information technology can transform the way an organization does business by enabling the organization to introduce new products and services made possible by technology. Holiday Inns introduced videoconferencing facilities so its business clients could arrange electronic meetings with counterparts in other cities. In this way, the hotel chain was able to use a new technology to open up a new business opportunity.

Numerous organizations are using technology to open us new business opportunities. An aggressive market research firm used point of sale systems in local grocery chains to record data on customer buying behavior in response to various advertising and promotional strategies.  Its advertising impact studies were superior to those of its competitors because it could tie the impact of advertising to an organization’s strategy.  The table below summarizes applications that affect strategy.

As you can see, most applications of information technology are directly linked with improving business performance. In many cases, they impact the products and services provided by the business unit.

Functional unit applications

Organization wide applications

1.5 Users of Information

Information as we have seen is sent to users. The information generated by an organization can be valuable to many different people. Users of an organization’s information can be:

  • External
  • Internal

Bear in mind that information may be relevant to people outside the organization as well as its internal management and employees. In fact, decisions relating to an organization can be taken by outsiders.

  • The organization’s bankers take decisions affecting the amount of money they are prepared to lend.
  • The public might have an interest in information relating to an organization’s products or services.
  • The media (press, television etc) use information generated by organizations in news stories etc., and such information can adversely or favorably affect an organization’s relationship to the environment.
  • The government (e.g., Department of Trade and Industry) regularly requires organizational information.
  • The Inland Revenue Authorities required information for taxation.
  • An organization’s suppliers or customers take decisions whether or not to trade with the organization.

Internal users of information include (by status) the following.

  • The board of the company; or public sector equivalent.
  • Directors with functional responsibilities.
  • Divisional general managers, reporting to these directors.
  • Division heads.
  • Department heads.
  • Section leaders or foremen.
  • Discretionary employees (those who are expected to act on their own initiative to some extent).
  • Non-discretionary employees (those work under instruction all the time with little scope of initiative).

Internal users of information by function are

  • Marketing
  • Finance
  • Administration
  • Production
  • Technical
  • Personnel
  • Research, etc.

Types of Information

A more functional classification of information is based on the basis of types of decisions. Information, as required at different levels of management can be classified as: operational, tactical and strategic.

Information Level

Information within an organization can be analyzed into three levels.

1. Operational information

Operational information relates to the day-to-day operations of the organization and thus, us useful in exercising control over the operations that are repetitive in nature. Since such activities are controlled at lower levels of management, operational information is needed by the lower management. Examples are such as cash positions and daily sales.

Operational information:

  • is derived almost entirely from internal sources
  • is highly detailed, being the processing of raw data
  • relates to the immediate term
  • is task specific
  • is prepared constantly, or very frequently
  • is largely quantitative

2. Tactical Information

Tactical information helps middle level managers allocating resources and establishing control to implement the top-level plans of the organization. For example, information regarding the alternative sources of funds and their uses in the short run, opportunities for deployment of surplus funds in short term securities, etc., may be required at the middle levels of management.

Tactical information is

  • is derived from a more restricted range of external sources, so is thus primarily generated internally
  • summarized at a lower level – a report might be included with summaries and raw data as backup
  • is relevant to the short and medium terms
  • describes or analyses activities or departments
  • is prepared routinely and regularly
  • is based on quantitative measures

3. Strategic Information

While the operational information is needed to find out how the given activity can be performed better, strategic information is needed for making choices among the business options. The strategic information helps in identifying and evaluating these options so that a manager makes informed choices, which are different from the competitors and the limitations of what the rivals are doing or planning to do. Such choices are made by leaders only. Strategic information is used by managers to define goals and priorities, initiate new programs and develop policies for acquisition and use of corporate resources.

Strategic information is therefore:

  • derived from both internal and external sources
  • summarized at a high level
  • relevant to the long term
  • deals with the whole organization (although it might go in some detail)
  • often prepared on an ‘ad hoc’ basis
  • both quantitative and qualitative
  • Incapable of providing complete certainty, given that the future cannot be predicted.

1.6 Process of Generation of Information

 The process of generation of information involves as series of activities. Broadly speaking, there are three basic activities:

  • Data acquisition
  • Data transformation
  • Management of information

Data Acquisition

As stated earlier, data are facts expressed with the help of symbols such as alphabets, digits, graphs, diagrams, pictures, etc., or in any other form. Data may describe an event or it may represent status of an element of the environment. Whatever may be the source of data; it may be initially recorded and later verified for accuracy and authenticity. This activity is called data capture.

Data may be captured by punching with keyboard or scanning with scanning devices, facts from documents on which they were recorded.

Data Transformation

Data transformation may be done by performing any of the following operations on data:

  1. Rearranging: rearranging data in some specified order is a very common data processing activity. For example, data regarding stores may be rearranged in order of date of purchase or in order of value of each unit or in the alphabetic order of names if these are items. Such a rearrangement is also known as sorting of data. Sorting may add to the usefulness of data.
  2. Calculating: for a layman, data is processed only by calculating. A series of calculations performed on numeric values is called computation. This is the logic behind for the computer to be called computing machine. Calculating involves performing arithmetic operations (like addition, subtraction, multiplication, division and logic operations).
  • Summarizing: summarizing is a process of aggregating various data elements, reducing the bulk of data to a more meaningful form. For example, a finance manager may be interested in knowing the total number of shares applied for in a public issue. The data in this regard may be summarized and such summary report may be more useful to him than the entire statement giving details of each share application received.

Management of Information

After acquisition and/or transformation, the processed data may be either communicated to end user or may be stored for future reference. If the information is to be communicated to the user, the format for the reporting must be selected. The format for reporting may include simple columnar/tabular format or visual formats, such as charts, diagrams, graphs, etc. Once the report format is decided, appropriate channel of communication need to be selected and used. In case the information generated is to be used in future it may be stored on some mass storage medium. Such activities of communicating and/or storing information may be termed as managing information.

1.7 The Attributes of Information

Information adds to relevant knowledge, reduces uncertainty, and supports the decision making process in an organization. However, to be useful, information must have essential attributes, both as individual items and as set of information.

The attributes of information are the characteristics that are meaningful to the user of each individual item of information. That is, each individual item of information can be described with respect to accuracy, form, frequency, breadth, origin, and time horizon.

Accuracy: information is true or false, accurate or inaccurate. Accurate and true describe whether information represents a situation, level, or state of an event as it really is. Inaccurate information is the result of errors, which could have occurred during collection, processing, or report preparation.

Form: is the actual structure of information. It includes the dimensions of quantifiable (qualitative or quantitative), level of aggregation (summary form or detailed form), and medium of presentation (printed or displayed on screen, television).

Frequency: the frequency of information is a measure of how often it is needed, collected, produced. It may be produced very frequently or very seldom, depending on the users’ need.

Information for preparation of federal income tax returns, for example, may be collected only once in a year.

Breadth: is the scope of events, places, people, and things that are represented by information. A broad scope of sales information, for example, may include all the sales territories of a company doing business in the country. A narrow scope may include just one territory for the company or part of one territory.

Origin: the origin of information is the source from which it is received, gathered, or produced. Internal information originates from within an organization, and external information originates outside it – from the government, for example, or from trade associations.

Time horizon: information is oriented toward the past (historical information), toward present situations, or toward future activities and events. Historical information provides as perspective on what happened at an earlier time; it may be examined to see whether progress has been made or situations have improved. Companies frequently examine historical information to see whether current profits, expenses, sales, number of employees, and so on, have increased, decreased, or stayed the same compared with the past. Future information helps organizations plan for demands and operating requirements in the years ahead.

The attributes of information that we have just discussed pertain to individual pieces of information. However, it is common to use several pieces of information together, that is, a set of information. Certain attributes are associated with sets of information; these characterize the set for the situation in which it will be used. They are relevance, completeness, and timeliness.

Relevance: information is relevant if an individual needs it in a particular decision making or problem solving situation. It is necessary part of the resources used to select a course of action. The important point is its application to the current situation. A set of information that was relevant at one time may not be relevant now if it is not actually needed and will not be used by the recipient. Similarly, information collected and maintained by someone on the assumption that sooner or later it will be needed is not relevant now because it is not needed now.

Completeness: if a given set of information tells the user everything that needs to be known about a particular situation, we say that it is complete. If a report, on the other hand, leaves an individual with a number of unanswered questions, it is an incomplete set of information. Although it often appears virtually impossible to gain the desired degree of completeness, we should try to find systems and procedures that give us the most complete information possible.

Timeliness: any manager has two important concerns: (1) is the information available when I need it? And (2) is it outdated when I receive it or when I want to use it? Substantial delays in the processing of information may significantly reduce its usefulness to a manager.

The attributes of information deal with the quality of information that will be used by managers. If any of them are substandard, the user is ill advised to rely on them to guide any actions or activities.

A Framework for Information Systems

Each of the management levels – operational, tactical and strategic planning requires different information systems with the characteristics discussed here below:

Operational Systems

At the operational level the primary concern is to collect, validate, and record transactional data describing the acquisition or disbursement of corporate resources. Financial data on accounts receivable, accounts payable, payroll, and cash receipts need to be recorded as they occur. When a sale is transacted, data on the items ordered are recorded, the inventory level for these items is adjusted, a shipping label and packing slip are prepared and an invoice is generated. The original transaction – the sale of the item – creates numerous transactions in order processing, inventory, and billing. Operational level information systems often have the following characteristics.

  • Repetitiveness: the information they produce is usually generated repetitively at periodic intervals, such as daily, weekly, or monthly.
  • Predictability: the information they produce usually does not contain any surprises or unexpected results for the manager or other users of the system. That is, people are paid what they were expected to be paid and customers are billed for what they purchased during the month.
  • Emphasis on the past: the information produced usually describes past activities of the organization. For example, the output of a payroll system describes employees’ work. The checks to vendors describe past purchases by the organization. Customer invoices describe past sales to customers. Stock reports describe past changes in inventory.
  • Detailed nature: the information produced is very detailed. That is, paychecks provide detailed information on the workweek of each employee and the specifics of each employee’s gross and net pay. Customer invoices specify details regarding purchases made during the period, the terms under which the purchases must be paid, and the total amount, taxes, and other charges due.
  • Internal origin: the data for operational systems usually spring entirely from internal sources. That is, the data for paychecks come from internal documents such as time cards and employee master records. The data for customer invoices come from sales orders and shipping documents.
  • Structured form: the form of the data used as input and the form of the information produced by operational level systems usually very structured. That is, the data on time cards are carefully formatted in identical fashion on each time card. Or the data on each customer invoice are carefully formatted in identical fashion. In short, the form and the format of the data input and the information output of the systems are highly structured.
  • Great accuracy: the accuracy of the data used as input to such systems is usually very high. The data input and information output are carefully checked in a variety of ways.

Tactical Systems

The second level in the framework consists of tactical systems. Tactical systems provide middle-level managers with the information they need to monitor and control operations and to allocate their resources more effectively. In tactical systems, transaction data are summarized, aggregated, or analyzed. Tactical systems are designed to generate a variety of reports, including summary reports, exception reports, and ad hoc reports.

Summary reports provide management with important totals, average, key data, and abstracts on the activities of the organization (e.g., List Total regular and overtime hours earned at each plant, total weekly sales, by salesperson, by product, and sales region).

Exception reports warn managers when results from a particular operation have exceeded or not met the expected standard for the organization (sales fall by 10% for some employees, more over time in certain plants).

Ad hoc reports that managers need, usually quickly, that may never be needed again. Ad hoc reports present information that the manager needs to solve a unique problem.

Tactical information systems differ from operational information systems in their basic purpose. Their purpose is not to support the execution of operational tasks but to help the manager control these operations. Tactical information systems often have the following features.

Periodic nature: the information from a tactical system is sometimes produced periodically (e.g., accounts receivable report). Sometimes ad hoc information may also be produced.

Unexpected findings: the information produced by a tactical information system may not be the information that was expected to be produced.

Comparative nature: the information produced is usually comparative in nature rather than merely descriptive. Tactical information systems should provide managers with information that alerts them to variances from accepted standards or results that are not within the normal range, so that remedial actions can be taken swiftly.

Summary form: the information produced is usually not detailed but in summary form. The credit manager is not interested in a detailed listing of each customer account and its balance.

Both internal and external sources: the data used for input to the system may not be confined to source internal to the organization.

Strategic Information Systems

Strategic planning level information systems are designed to provide top management with information that assists them in making long range planning decisions for the organization; Strategic planning information systems often have these characteristics:

  1. Ad Hoc Basis: the information may be produced either regularly or periodically. For example, periodic accounting system reports are used by top management in its planning function. However, strategic planning information is more often produced when it is needed, on an ad hoc basis.
  2. Unexpected Information: the information produced by the system may not be the information that was anticipated.
  3. Predictive Nature: the information produced is usually predictive of future events rather than descriptive of past events. Long-range planners try to set a course for an organization through an uncharted future. Their primary task is to choose a route that will improve the organization’s level of success. The information that the strategic planning system provides should help these planners the risks involved in their choice of routes.
  4. Summary Form: the information produced is usually not detailed but in summary form. Long range planners are not usually interested in detailed information. They are usually concerned with more global data. (Example, buying trends, overall demographic characteristics of groups of customers).
  5. External Data: a large part of the data used for input to the system may be acquired from sources external to the organization. (Investment opportunities, rates of borrowed capital, demographic characteristics of a market make group and economic conditions must be obtained from data maintained outside the organization).
  6. Unstructured Format: the data used for input to the system may contain data that are unstructured in format. For instance, forecasts of future market trends may use the opinions of store buyers, salespeople, or market analysts obtained in causal conversations.
  7. Subjectivity: the data used for input the system may be highly subjective and their accuracy may be suspect. For instance, forecasts of future stock market trends may be based partly on rumors reported by brokers. Forecasts of the expected market share of your organization within the industry observers who are basic their opinion on rumors and on conversations held with a variety of industry personnel are examples of subjective information.

A comparison of Information Systems at the operational, tactical and strategic planning levels



Summary of Classification Information Systems
Operational Tactical Strategic Planning

Dependability of results


Time period covered

Level of detail

Source of data

Nature of data


Typical user

Level of decision

Regular, repetitive

Expected results


The past

Very detailed


Highly structured

Highly accurate data

First line supervisors

Task oriented

Most regular

Some surprises may occur



Summaries of data

Internal and external

Some of unstructured data

Some subjective data

Middle managers

Control and resource allocation oriented

Often ad hoc

Results often contain surprises

Predictive of the future

Summaries of data

Mostly external

Highly unstructured

Highly subjective data

To management

Goal oriented


Information as corporate resource has the following features.

  • Information is a value added resource. Just as value is added to a product as it moves from raw material stage to final product; the same is true of conversion of data into information.
  • Information has a specific cost associated with it just as if it were acquired from the market. Therefore, it is as essential to acquire and utilize information efficiently as it would be for any other resource.
    • Information is meant to be shared by all associated with the attainment of company’s common goals and they, in turn, contribute to the corporate stock of information.
    • Information is exposed to a variety of security risks. Therefore, it has to be protected by implementing appropriate security policies and procedures without hindering its seamless flow across its users.
    • Most of the information is organization specific and its value depends upon its use by the decision maker.
    • It has a high rate of obsolescence and thus, it must reach the user as early as possible. Redundant part of this resource must be weeded out of the total stock of information.

1.9 Systems

A system can be described simply as a set of elements joined together for a common objective. A system is a collection of people, machines, and methods organized to accomplish a set of specific tasks. A system is defined as a number of components, entities that form a whole. These entities interact in such a way as to achieve a goal. It is a set of objects that are relevant and may not be described in terms of their attributes or component parts.

Systems boundary: all systems have a boundary that separates them from their environment. The activities in a class include lectures, discussion, testing, grading, and preparation of assigned course work. When defining a system, you need to establish a boundary. A boundary may delineate an area of responsibility. This boundary depicts the scope of activities to be supported by the system.

Systems and subsystems: systems may consist of numerous subsystems, each of which has elements, interactions, and objectives. Subsystems perform specialized tasks related to the overall objectives of the total system. For example, an educational system may consist of individual courses that are subsystems. Each course provides specific knowledge that is a part of the overall educational system and contributes to its goals. In a business system, various functions are the subsystems.

Outputs and inputs: the inner workings of a system or subsystem are organized to produce outputs from inputs. In this conversion process, some value, or utility, should be added to the inputs. For example, a training program should produce trained employees with certain skills, knowledge, or behavior from its inputs – untrained employees. The outputs of one subsystem usually become inputs into the next.

An interface is a connection at system or subsystems boundaries. Two typical business systems that interface with each other are inventory control and purchasing.

Systems and their environment: the system’s environment consists of its goals, needs and activities.

Open and closed systems: open systems operate in an external environment and exchange information and material with that environment. The external environment consists of the activities external to the system boundary with which the system can interact. An open system needs to receive feedback to change and continue to exist in its environment.

In contrast, a closed system is relatively self-contained; exchange with its environment does not occur. Closed systems do not get the feedback they need from the external environment and tend to deteriorate. For instance, if a training program administrator does not respond to the needs of environment for trained graduates, students will no longer be able to get jobs and will go elsewhere for training. Eventually, the training program will be discontinued.

Systems feedback: a system needs feedback to do its job. Feedback is form of control, because it requires continuing adjustments in the activities of the system. Employees need feedback to learn how they are doing job goals. Students receive grades or other kinds of evaluations from instructors to be whether they are meeting course objectives. The good thing about feedback it that it usually increases effort

System entropy and negative entropy: systems can become run down if they are not maintained. If employees do not have opportunities to learn new concepts and techniques, the skills they apply to performing job tasks will become out of date. The process of maintaining a system is negative entropy. Sending automobile mechanic to training classes to learn new diagnostic techniques is an example of negative entropy. Negative entropy can be achieved through preventive maintenance checks, such as a yearly physical examination for an employee or a routine tune up for an automobile.

Systems may be abstract or physical: an abstract system is conceptual, a product of the human mind. That is, it cannot be seen or pointed to as an existing entity. Social, technological, cultural systems are abstract systems. None of these entities can be photographed, drawn, or otherwise physically pictured. However, they do exist and can be discussed, studied and analyzed. A subsystem is part of a larger system with which we are concerned. A physical system, in contrast, is a set of elements – rather than ideas or constructs – that operate in relation to one another to accomplish a common goal or purpose.

Examples of physical systems include:

  • Compute systems: collection of hardware elements that work interdependently under some means to control to process data and produce output reports.
  • Communication system: collections of components that can represent and transmit bits of information from one pointer to another.
  • Marketing systems: collection of people, equipment, and procedures that develop, produce, and distribute commodities, ideas and other entities to consumers or users.

A system must have an objective or goal. It is probably true to say that all systems have more than one objective. A business organization, for example, might list as its objectives:

  • to generate a reasonable financial return for shareholders
  • to maintain a high market share
  • to increase productivity annually
  • to offer an up-to-date product range of high quality and proven reliability
  • to be known as responsible employers
  • to acknowledge social responsibilities
  • to grow and survive autonomously;

Information Systems

In many ways, information systems have the same characteristics as systems in general. The major purpose of an information system is convert data into information; information is data with meaning. In a business context, an information system is a subsystem of the business system of an organization. Information system can be defined as a set of interrelated components that sense, communicate, analyze, and display information for the purpose of enhancing our perception, understanding, control and creative ability.

The information system

  1. takes in data from the environment using of the sensing and communication technologies (INPUT);
  2. Analyzes this information using computer hardware and software (PROCESS);
  3. Displays this information using computer hardware and software (OUTPUT);
  4. Either you or the computer uses this information to act on the environment (FEEDBACK).

An information system, like any other system, receives inputs of data and instructions, processes these data according to these instructions, and produce outputs.

Hierarchy of subsystems: the subsystems within an information system can also be organized into a hierarchy that represents their functions within the overall system. Each subsystem performs a specialized function.

An information system is an example of both a technical system and a social system. It is a technical system in that it may contain a large number of machinery (computers, telephones etc), but it is also a social system given that it may reflect, in the way it is used, the social structure of the organization. For example, an information system not only exists to record transactions but also it is used to provide summary information to senior management to assess whether the organization is following its long-term strategic objectives.

The information system links the disparate parts of the organization together (persons, groups, departments, or organization to another).

Elements of Information Systems

Computer Hardware: computer hardware refers to computer systems and other associated equipment including the communication links that a modern IT installation may need. With the rapid advancement in computer hardware technology, a large variety of computer systems with varying sizes, speeds, and functional feature are available. To be able to determine the hardware resource requirements, it is necessary to properly assess the nature of IT needs, the volume of data to be processed, sources of data, complexity of data analysis and impact of other related factors. Such an assessment should also make provisions for expected changes in these factors in the future.

The following list presents computing power from the least expensive and least powerful to the most expensive and most powerful.

  1. Microcomputers (sometimes called personal computers). Based on a single tiny silicon chip called a microprocessor that contains all the essential elements of a computer.
  • Desktops
  • Portables (like laptop, notebook, and palmtop or handheld computers)
  1. Workstations: faster and more powerful than microcomputers, workstations are used by engineers, architects, scientists, commercial artists, and others who heed computers for speedy number crunching and graphics
  • Minicomputers: generally have more speed and power than workstations, but less than mainframes. They can handle several hundred simultaneous users and can run multiple programs concurrently.
  1. Mainframes: are the standards for large business and government agencies, although computer networks composed of smaller computers are threatening to surpass them.
  2. Supercomputers: are the largest and powerful computers.

Software: putting it simply, sets of inter related computer programs are collectively called computer software. A program is a set of instructions, which enable particular processes to be performed by a computer. Software is lifeline of the IT infrastructure and it makes the computer hardware function. Software determines what the hardware does and makes the hardware perform. Software, thus, is a very important IT resource and must be carefully selected and properly maintained. Software, being intangible, sometimes gets a back seat in planning for an IT infrastructure. In fact, improper selection of software may become a major cause of failure of an IT infrastructure in achieving its objectives. There are two types of software:

  1. System software: programs that control and coordinate the operation of the various types of equipment in a computer system.
  2. Applications software: programs that allow you to apply the computer to solve a specific problem or perform a specific task (i.e., word processing, spreadsheet, graphics, database programs).


Formal operating procedures are physical components because they exist in a physical form such as a manual or instruction booklet. Three major types of procedures are required:

  1. User instruction (for users of the application to record data, employ a terminal to enter or retrieve data, or use the result)
  2. Instructions for preparation of input by data preparation personnel
  3. Operating instructions for computer operations personnel

The procedures play an important role in the smooth and effective utilization of information resource. They also protect the information resource and maintain its quality. Thus, the procedures as element of information system refer to the instructions to users regarding the use of IT infrastructure for normal day-to-day activity and also for handling special situations such as systems failures and crashes. They include user access permissions and disaster recovery procedures as well.

Human resources: the effectiveness of an IT infrastructure is a function of the type of IT personnel available to it. In fact, best of computer hardware, software and data may be spoiled and may cause havoc if the human resources are not competent, honest or reliable. Qualities like competence, honesty and reliability are critical to any work environment. These include computer operators, systems analysts, programmers, data preparation personnel, information systems management, data administrators, etc.

The term management information system (MIS) is possible to define in a number of different ways, some of which are listed below:

  • ‘A computer system or related group of systems which collects and presents management information to a business in order to facilitate its control.’

      (CIMA: Computing Terminology)

  • ‘A system to convert data from internal and external sources into information and to communicate that information, in an appropriate form, to managers at all levels in all functions to enable them to make timely and effective decisions for planning, directing and controlling the activities for which they are responsible

      (Lucey: Management Information System).

  • Management information system (MIS): is an integrated, user machine system for providing information to support operations, management, and decision making functions in an organization. The system utilizes computer hardware and software; manual procedures; models for analysis, planning, control and decision making; and a database (Davis and Olson: 1985). The fact that it is an integrate system does not mean that is a single, monolithic structure; rather, it means that the fact parts fit into an overall design. The elements of the definition are highlighted below:

Management information system is

  • an integrated user machine system (some can be performed using machine, other without machines)
  • for providing information
  • to support the operations, management, analysis, and decision making functions
  • in an organization

The system utilizes

  • Computer hardware and software
  • manual procedures
  • models for analysis, planning, control, and decision making and
  • a database

Scope of MIS

What is common to these definitions is presented to management. However, this is not the only function of an organization’s information systems. A number of tasks might be performed simultaneously:

  • initiating transitions (e.g., automatically making a purchase order if stock levels are below a specified amount);
  • recording transactions as they occur (e.g., a sale is input to the sales ledger system);
  • processing data (e.g., as described in earlier chapters);
  • producing reports (e.g., summaries);
  • Responding to enquires.

The objective of an MIS is to provide information for decision making on planning, initiating, organizing, and controlling the operations of the subsystems of the firm and to provide a synergistic organization in the process.

1.10 Subsystems of an MIS

MIS has been introduced as a broad concept referring to a federation of subsystems. Two approaches to defining the subsystems of an MIS are according to the organizational functions, which they support, and according to managerial activities for which they are used.

Organizational Function Subsystems

Because organizational functions are somewhat separable in terms of activities and are defined managerially as separate responsibilities, MIS may be viewed as a federation of information system – one for each major organizational function. There may be common support systems used by more than one subsystem, but each functional system is unique in its procedures, programs, models, etc., typical subsystems for a business organization engaged in manufacturing are:

Major functional subsystem Some typical uses
Marketing Sales forecasting, sales planning, customer and sales analysis
Manufacturing Production planning and scheduling, cost control analysis
Logistics Planning and control of purchasing, inventories, distribution


Finance & accounting

Planning personnel requirements, analyzing performance, salary administration

Financial analysis, cost analysis, capital requirements planning income measurement

Information processing

Top management

Information system planning, cost effectiveness analysis

Strategic  planning, resource allocation

The database is the primary means of integration of the various subsystems. A data item that is stored or updated by one subsystem is then available to the other subsystems. For instance, the sales and inventory information used by the marketing subsystem is supplied through the logistical subsystem; the same data is used by the manufacturing subsystem for production planning and scheduling.

Activities Subsystem

Another approach to understanding the structure of an information system is in terms of the subsystem, which perform various activities. Some of the activities subsystems will be useful for more than one organizational function subsystem; others will be useful for only one function.

Activity subsystem

Transaction processing

Some typical uses

Processing of orders, shipments, and receipts

Operational control

Management control

Scheduling of activities and performance reports

Formulation of budgets and resource allocation

Strategic planning Formulation of objectives and strategic plans
Strategic planning Formulation of objectives and strategic plans

Note that these activities subsystems correspond to the levels of the pyramid structure that defines MIS. The relationship of activities subsystems to functional subsystems is illustrated in the following figure.

Relation of activities to functional subsystems

Inputs, processes and output of MIS at all levels of Management

  Inputs Process Outputs
Strategic Plans, competitor information, overall market information Summarize




Key ratios, ad hoc market analysis,

Strategic plans

Tactical Historical, and budget data Compare

Classify Summarize

Variance analysis

Exception report

Operational Customer orders

Programmed stock

Control levels

Cash receipt or payments

Update files

Output reports

Updated files

Listings, invoices

Check Your Progress Exercise

  1. Explain the following terminologies.
    • Management


  • Information


  • System


  1. What is the purpose of information technology and explain its impact from individual, organizational and functional unit view?



  1. Explain the process of generation of information.



  1. Discuss the features of information as a corporate resource?



  1. Identify and explain the two forms of software.



1.11 Summary

The evolution of computers shows that prediction over 30 years ago that computers would change organizational structure and the nature of managerial work is coming true. Early attempts to manage paper work used computers to mechanize tasks such as information retrieval. In the 1980s and 1990s, organizations learned that information technology could provide a competitive edge by adding value to products and services. Telephone links to diagnostic databases, vendor hotlines, and dealer networks supported by telecommunications links all provide better service to customers. Computer systems can link buyers and sellers, manufacturers and dealers, and home offices and branch offices.

Today, as most organizations make the transition to become information based organizations; it is essential for managers to understand emerging technologies and their applications. These applications should be focused upon efficiency, effectiveness and transformation. The key to 1990s will be using information technology to do things that were altogether impossible before.

As a future manager, you will want to become thoroughly acquainted with the challenges that information technology provides. This material will give you an opportunity to learn about information systems, to use information systems tools, and to become familiar with the systems development process all from manager’s viewpoint.

1.12 Answer to Check Your Progress Exercise

  1. Refer to Section 1.3
  2. Refer to Section 1.4
  3. Refer to Section 1.6
  4. Refer to Section 1.8
  5. Refer to Section 1.9

Unit 2: An introduction to Concepts of systems and    Organizations


2.0   Aims and Objectives

  • Introduction
  • System Concepts
  • Systems And Their Environments
  • Systems Concepts In Business
  • Using The Systems Approach In Problem Solving
  • Systems Concepts in Organizations
  • Summary
  • Answer to Check Your Progress Exercise

2.0 Aims and Objectives

After studying this unit the student should be able to:

  • explain the basic systems concepts
  • understand systems and their environments
  • describe how a system works
  • understand systems concepts in business and
  • explain how systems concepts in organizations operate

2.1 Introduction

When you begin the study of information systems, you should become acquainted with a theoretical framework for understanding their use, development, and effect on organizations; that is, you need to have an understanding of systems concepts as a foundation for further study.  The word system is often misunderstood-some people think you are referring to a computer system when you use the term, but you may hear people talk about financial systems, air-conditioning systems, school systems, and investment systems as well as about information systems.  A system is a collection of people, machines, and methods organized to accomplish a set of specific tasks.  Information systems which are a major topic in this text have the same components and characteristics as systems in general.

This unit introduces the concepts of systems, their characteristics, and their interaction with the environment.  As a manager, you’ll constantly be dealing with systems, and you’ll need feedback about their performance.  Information is the feedback you need to determine if systems are achieving their objectives, operating with the necessary components, and meeting the necessary standards. Information systems are designed to give managers the information they require as feedback.

In addition, you will learn about the systems approach to problem solving.  As a manager, you will be dealing with many types of systems and you will be responsible for improving their performance.  For example, you’ll determine if procedures, personnel, and equipment need to be changed to achieve objectives.  Or you’ll need to assess the effect of new equipment on current work methods, procedures, and origination.  The systems approach to problem solving will help you deal with these kinds of task.

Finally, this unit explains how organizations operate as systems, with unique characteristics, information flows, and decision processes.  You will learn about the components of organizations and about different types of organizational structures.  You will need to recognize the structures of organizations to understand the decision-making processes that occur within different types of organization.

2.2 Systems concepts

A system is an integrated set of components, or entities, that interact to achieve a particular function or goal. Systems have characteristics such as boundaries, outputs and inputs, methods of converting inputs into outputs, and system interfaces, as well will see. Systems are composed of interrelated and interdependent subsystems. Examples of systems are all round us – in fact, an excellent example is a college class. The components of the classroom situation, including an instructor, the students, textbooks, and facilities, all interact to make the accomplishment of learning goals possible. (Figure 2-1 depicts a model of a classroom system.)

A business is also a system. A business uses resources such as people, capital, materials, and facilities to achieve the goal of making a profit. Business procedures, such as order handling, marketing research, financial planning, and manufacturing, are the interactions that need to be managed to achieve this objective.

For a more thorough understanding of systems, though, you need to be familiar with concepts like boundary and interface.

System boundaries

All systems have a boundary that depicts its scope of activities. For example, the activities in a class include lectures, discussion, testing, grading, and preparation of assigned course work. These activities may represent the boundary of the system for which a teacher is responsible. Within the system of the classroom, the teacher is responsible for organizing class time, assigning homework to students, and evaluating student progress. The boundary, then, delineates an area of responsibility. When defining a system, you must establish a boundary.

System boundaries are established within a business system. A sale manager may be responsible for managing, motivating, and evaluating the performance of a sales organization. The owner of the business, however, faces different boundaries and may develop a financial plan, a marketing strategy, and a long-range business plan.

Systems and subsystems

Systems may consist of numerous subsystems, each of which has elements, interactions, and objectives. Subsystems perform specialized tasks related to the overall objectives of the total system. For example, an educational system may consist of individual courses that are subsystems. Each course provides specific knowledge that is a part of the overall educational system and contributes to its goals.

                                                Figure 2-1 A classroom system

Figure 2-2 typical subsystems: An example

In a business system, various functions are subsystems. Marketing, finance, and manufacturing, for example, are subsystems. Within the marketing subsystem, the sales order entry and credit-checking functions are subsystems. Each subsystem uses its resources to meet specific objectives. For instance, in managing the sales order entry function, the supervisor needs to develop sales order producers, maintain sales order records, and train sales order personnel.

Outputs and inputs

The inner workings of a system or subsystem are organized to produce outputs from inputs. In this conversion process, some value or utility should be added to the inputs. For example, a training program should produce trained employees with certain skills, knowledge, or behavior from its inputs – untrained employees.

The outputs of one subsystem usually become inputs into the next. The outputs of a course in introductory data processing concepts, for instance, become inputs into the next course in COBOL programming. (These two subsystems are depicted in Figure 2-2)

As you’d expect, the outputs of a subsystem have to adhere to certain standards to be acceptable to the next. If students coming out of the introductory data processing course don’t understand basic concepts of file organization and file processing, they won’t have the prerequisite skills needed for COBOL. If they’re not permitted to enter COBOL until they meet certain standards, though, the problem would be alleviated. The more exactly standards are adhered to; the easier it will be to interface the two courses, or subsystems.

An interface is a connection at system or subsystem boundaries. An interface serves as a medium to convey the output from one system to the input of another system. An example will help clarify this concept. Two typical business systems that interface with each other are inventory control and purchasing. If inventory levels drop below a certain level, then additional stock of these items should be purchased. Purchasing will need to know what quantity of a particular item to obtain to replenish the stock and information on sales and inventory turnover to learn which items are in greatest demand so these items can be replenished on a timely basis. An inventory control system will provide information on stock to be reordered based upon sales and inventory turnover trends.

However, if the inventory control subsystem triggers erroneous information about the amount of stock to be reordered, then inputs into purchasing will be wrong. This problem can be partially overcome by establishing an economic order quantity, or the quantity of an item that is most economical to buy, for each item in inventory. This quantity, derived from order history and inventory turnover rate, can serve as a standard and prevent reordering too much or too little stock.

Subsystem interface and interface problems

In the previous section we discussed how some interface problems can be alleviated through the development of standards. But you might encounter other types of interface problems. Sometimes the output of one subsystem is not sufficient to accommodate the needs of the next subsystem. For example, the production system may not be able to produce enough stock to meet sales demands during certain peak periods. One way of handling this interface problem is through the use of slack resources. In this situation, excess inventories can be built up on purpose to meet the demand for sufficient inventory at peak times.

Another system interface problem can occur between the authoring subsystem and the editorial subsystem in the development of a textbook. Authors who wait until the last minute to finish their writing may not be able to produce manuscript fast enough to meet production schedules, which involve editing, artwork, layout and design, typesetting, and proofreading tasks. This problem can be avoided in several ways. First, an author may be asked to complete several chapters before production activities begin. This is another example of using slack resources.

Second, an author may be asked to adhere to certain standards for input into the production subsystem. For example, the author may be asked to create and store all text using a word processing package that can be transported to a computer-based typesetting system without rekeying.

Third, an author could hire a library researcher, photo researcher, and typist to provide a support subsystem to expedite the development of manuscript. This is an example of how creating a new subsystem can help solve a system interface problem.

Another situation in which a system interface problem can be solved by designing a new subsystem occurs at a college when it accepts some students with deficiencies in their academic backgrounds. To bridge the gap between high school and college, a remedial subsystem can be created to help students develop prerequisite skills for college work. For instance, students lacking basic writing skills may be required to take a remedial writing class to learn spelling, grammar, punctuation, and composition skills. On successfully completing this class, they may receive permission to enroll in classes in literature.

2.3 Systems and their environments

The system’s environment consists of people, organizations, and other systems that supply data to or that receive data from the system. Not surprisingly, the environment is perceived differently by different managers. A sales manager, for example, envisions the system environment to be the company’s customers and vendors of the products and services being marketed. But the owner of the business perceives the environment to include the firm’s competitors, financial institutions that provide resources for expansion, and government agencies with jurisdiction over company plans and products. Moreover, not only can the environment be perceived differently by different managers, but also various kinds of systems don’t always interact with the environment in the same way.

Open and closed systems

Open systems operate in an external environment and exchange information and material with that environment. The external environment consists of the activities external to the system boundary with which the system can interact. An open system needs to receive feedback to change and to continue to exist in its environment. For example, a marketing system, which is an open system, operates in an environment of competition. If a competitor introduces new technology by providing customers with on-line order entry terminals, the marketing function must adapt to the change in the environment or remain at a competitive disadvantage. One way of accommodating the change in the environment is to offer a similar on-line order entry service. The same type of adjustment is necessary when an airline offers a new service, such as a frequent flier bonus program. Though the new service may temporarily give the air carrier a competitive advantage, the other airlines soon follow suit and offer a similar program.

In contrast, a closed system is relatively self-contained; it doesn’t exchange information with its environment. Closed systems don’t get the feedback they need from the external environment and tend to deteriorate. For instance, if a training program administrator doesn’t respond to the needs of the business environment for trained graduates, students may no longer be able to get jobs and may go elsewhere for training. Eventually, the training program may be discontinued.

You might wonder why closed systems exist at all. More often than not, participants in a system become closed to external feedback without fully being aware of it. For example, a university may only offer graduate courses during the daytime hours because it has always scheduled these courses in this way. Without recognizing the growing number of working adults wishing to enroll in evening graduate programs, the university may find registrations dwindling and may even have to discontinue certain courses. If university officials had been more responsive to student needs, however, they might have enjoyed booming enrollments among the population of adult evening students.

System feedback

A system needs feedback to do its job. Feedback is an indicator of how current performance rates when compared to a set of standards. With effective feedback, continuing adjustments in the activities of a system can be made to assure that the system achieves its goals. Measuring performance against a standard is an effective control mechanism. Employees need feedback to learn how well they are achieving job goals. Students receive grades or other kinds of evaluations from instructors that show whether they are meeting course objectives.

The good thing about feedback is that it usually increases effort. For example, tennis players often perform better when they are keeping score. When salespeople receive positive feedback, it increases their motivation to achieve a sales quota. Negative feedback may also serve a useful purpose. Negative feedback is designed to correct or guide activities that are not consistent with achieving the goals of the system. If sales people are not achieving quotas, they may want to rethink current sales techniques or reorganize their time. Similarly, if students receive low grades, they may need to improve study habits, obtain tutoring, or enroll in courses that better match their abilities or backgrounds.

Product managers also need feedback on how well new products fare in certain markets. They conduct market research studies in test markets to compare new products with established products. They can use feedback from these market tests to redesign a new product or identify target markets for which the product is suitable before its introduction. Sometimes a company receives feedback after introducing a new product. When Coca-Cola introduced new Coke, negative feedback from its established customer base forced the reintroduction of its original formula as Classic Coke.

Trainers in companies also need feedback about how well their programs are equipping trainees for job tasks. Feedback from supervisors may provide suggestion on what skills trainees need to perform successfully on the job. For example, employees who take training program to learn how to use Lotus 1 – 2 – 3, a popular

Figure 2-3 A training system and its environment

Microcomputer spreadsheet program may not be taught how to copy formulas from one cell to a range of cells and may experience difficulty performing this procedure on the job. This feedback may be used to build more exercise on the copy command into training classes. Figure 2-3 depicts a training system and its environment. It also shows how feedback from the external environment can be used to modify or improve the system’s internal workings.

So far we’ve emphasized the constructive aspect of feedback. Sometimes the wrong kind of feedback is provided, however. This would be true if students were rewarded for the number of book reports they complete, rather than for the quality of the reports. They may skim books to get just enough information to complete and submit each report without developing comprehension and reading skills – the real objectives of the exercise. Or if employees get the wrong kind of feedback, they may increase their efforts in areas that aren’t useful in achieving the objectives of the system. For example, if salespeople are rewarded for the number of sales calls they make instead of the number of sales they close, they will try to fit in as many calls a day as they can rather than spending the time with each customer to make a sale. As a result, the company may lose business and not achieve its objectives.

Such considerations make it clear that feedback mechanisms must be designed for effective control of business functions within an organization. In a business setting, an inventory manager needs to manage the inventory levels of hundreds of items to avoid shortages of items in demand and to prevent excess inventory levels of items that do not turn over frequently. The inventory manager needs feedback to control these inventory levels and determine when to order new stock of certain items. An inventory control system can automatically generate a purchase order for stock replenishment when an item in inventory falls below its recorder point. (The reorder point is the inventory level of an item that signals when more stock of that item needs to be reordered.) This is an effective control device, because if inventory level falls below a safe level, incoming customer orders cannot be filled. However, if excess inventories build up, cash will be tied up unnecessarily.

In short, may information systems provide managers with information they need to allocate their resources to achieve business goals. By having information about current business activities, managers can control production, inventory, and marketing resources and invest these resources in the most profitable ways. Information on planned versus actual sales, for example, can be used to detect slow-moving items and cut production of these items. Fast-moving items should trigger production so the sales function can take advantage of market demand.

Systems entropy

Systems can run down if they are not maintained. Systems entropy corresponds roughly to chaos or disorder – a state that occurs without maintenance. If employees do not have opportunities to learn new concepts and techniques, the skills they apply to performing job tasks will become out of date. The process of maintaining a system is a process of decreasing entropy or increasing orderliness. Sending automobile mechanics to training classes to learn new diagnostic techniques is an example of decreasing entropy. Orderliness can be achieved through preventive maintenance checks, such as a yearly physical examination for an employee or a routine tune-up for an automobile, and then taking action as a result of these regular checks. These checks provide valuable feedback to help detect faults or problems when none have been anticipated. Diagnostic tools for equipment and machinery help prevent downtime, which may cause delays in production and cost thousands of dollars in lost business.

System stress and change

Systems change over time. Some of these changes occur because of identified problems, new business opportunities, and new management directives. Systems may also change as a result of stresses. The achievement levels needed to meet existing goals may change. For example, because of reduced profit margins on sales, a division sales manager may insist on a sales increase of 10 percent instead of 7 percent to achieve the same profits. The tendency is to localize the stress so the pressure for adjusting to new demands is felt primarily by one subsystem, in this case the division sales force.

It is easier to deal with change within one subsystem than within the total system because stress may require rethinking existing work methods and organization. In this case, the sales manager may have to develop more effective procedures to improve the profitability of sales. The sales manager may recommend cutting down calls to smaller customer accounts and substituting telemarketing to service their needs. Salespeople might need to reallocate their time so they can pay special attention to customers who purchase the most profitable product lines and encourage customers who purchase less profitable lines to look at high-margin products. All these procedures require a close analysis of the current system, changes in work procedures, and effective time management.

Another source of system stress occurs if inputs cannot be monitored but the system is expected to produce the same quality of output. Many colleges and universities screen applicants using standardized test scores, high school grades, and references. Some educational institutions, however, have open admission policies that make it possible for all high school graduates to apply and be admitted. Because admitting candidates without the necessary academic skills for college study places undue stress on the entire educational system, colleges with open admission policies typically localize this stress by establishing remedial programs and hiring specially trained teachers for these students. Students are expected to pass remedial course work before entering regular college courses.

In a business situation, the same thing happens. New workers participate in training programs before being placed in positions within the firm. During the training period, they learn specific job-related practices so they can become productive in the work environment as soon as possible. After training, they are placed in positions consistent with their skill levels and backgrounds. This orientation and training process helps minimize the stress that might occur if the new employees were placed directly into positions within the firm.

Although it is often easier to deal with stress by changing the activities of a subsystem, it is also important to remember that the subsystem is a part of the whole system and interacts with other subsystems in achieving overall objectives. It may be necessary to consider the entire system is responding to a problem and to modify activities in other subsystems as well.

How a system Works

You can get a better idea of how a system works by considering the activities of a professional baseball team. A professional baseball team consists of components that are organized to achieve its objectives. One of the major objectives of a baseball club is to win games. To achieve this goal, the owner and manager may recruit players, organize training programs, and develop publicity campaigns. When the team needs a good catcher, the manager may acquire a new player by making a trade. All these components – players, management, training, and promotion – interact to enable the ball club to achieve its objectives.

Systems differ in terms of their goals, components, and characteristics. The objective of one ball club may be to win games. To achieve this goal, it may recruit highly paid professionals throughout the season to fill gaps in the lineup. In contrast, the objective of another team may be to make money. Instead of recruiting highly paid athletes, this second team may enlist talented rookies, hoping to fill the ballpark with dedicated fans. Each of these two ball clubs has a different system with different objectives. The measures of success that each club uses to evaluate its performance vary.

2.4 Systems concepts in business

Now that you have a general picture of how a system works, it will be helpful to look more closely at business systems. The systems approach is a way of analyzing business organization as a system of interrelated parts designed to accomplish goals. Each subsystem is both a self-contained unit and a part of a larger system. Managers must understand the goals of the total system and design the function of subsystems within the total system to make it possible to accomplish these goals.

More specifically, management is the practice of organizing resources, including people, materials, procedures, and machines, to achieve objectives. In other words, it entails organizing subsystems to accomplish specific tasks. Using a systems approach, a manager organizes various activities of the business into separate organizational subsystems. The subsystems of the business are connected by resource flows throughout the firm.

An information system as a system

In many ways, information systems have the same characteristics as systems in general. The major purpose of an information system is to convert data into information – information is data with meaning. In a business context, an information system is a subsystem of the business system of an organization. Each business system has goals, such as increasing profits, expanding market share, and providing service to customers. The information systems of an organization should provide information on the day-to-day activities of a business, such as processing sales orders or checking credit. These systems are called operational systems. Information systems also must be designed to provide information that lets management allocate resources effectively to achieve business objectives. These systems are known as tactical systems. Finally, information systems must support the strategic plans of the business, and these systems are known as strategic planning systems. But to sum up our discussion so far, information provides managers with the feedback they need about a system and its operations – feedback they can use for decision making. Using this information, a manager can reallocate resources, redesign jobs, or reorganize procedures to accomplish objective successfully.

An information system consists of components that interact to achieve the objective of providing information about day-to-day activities that managers can use to control business operations. Information systems can also be designed to provide information to enable managers to allocate resources and establish long-range business plans. An information system contains such elements as hardware, software, personnel, databases, and procedures to accomplish its objectives. The hardware consists of the computer devices that support data processing, communications processing, and other computer related activities. Software consists of the instructions that the hardware uses to process information. Software consists of the instructions that the hardware uses to process information. Software includes both application software and system software. Application software consists of the programs written to support specific business functions, such as order entry, inventory control, and accounts receivable. System software enables the hardware to process application software programs. System software consists of the programs that handle such functions as sorting data, converting programs into the machine language the computer can understand, and retrieving data from storage areas.


Operational systems, which are designed to provide information about day-to-day activities, are composed of subsystems that accomplish specialized tasks. A mail-order business, for example, needs a system to process customer orders. The order-processing system actually consists of subsystems set up to handle incoming orders, update inventory levels, and bill customers. Other subsystems are created to purchase new stock, to handle accounts payable transactions, and to apply cash receipts from customers to outstanding accounts receivable balances.

Figure 2-4 A model of an information system

Each of these subsystems performs a specialized task that supports the business objectives of increasing sales and providing customer service.

However, if one of these subsystems breaks down, the overall business will feel the effect. For example, if the mail-order company does not maintain sufficient inventories, customers may become frustrated with constant back-orders and shift their business to other mail-order companies.

Outputs and Inputs

An information system, like any other system, receives inputs of data and instructions, processes the data according to these instructions, and produces outputs. This information-processing model can be used to depict any information system.

In an inventory update procedure, the inputs are sales order transactions and an old inventory master file. During the update procedure, the item quantities for each item on a sale order transaction are subtracted from the existing inventory level for that item in stock. The new inventory level is then written to the new inventory master file. The outputs of this system are an updated inventory master file, a reorder report, and a sales listing. A reorder report lists any items in inventory that have fallen below their desired inventory level and provides a purchasing manager with feedback about items that need to be reordered.

Hierarchy of subsystems

The subsystems within an information system can be organized into a hierarchy to represent their functions within the overall system. Each subsystem performs a specialized function. In the order entry and inventory update example, one subsystem may record sales transactions an input, another subsystem may check customer credit, and another may check inventory availability. Other subsystems may update inventory, generate a reorder report, and produce information for billing, and so on.

System Feedback

An information system provides system feedback to a manager about day-to-day activities and about deviations from planned activity. The manager can use this information to supervise daily operations, such as credit checking and billing, and to reorganize resources to achieve objectives more effectively. In the inventory control example, one of the outputs was a reorder report indicating which inventory items need to be reordered. A purchasing manager could use this report to reorder additional stock on a day-to-day basis.

Middle managers might want feedback about which items in inventory are moving rapidly and which items are moving slowly so they can reallocate the investment in inventory to minimize waste and maximize profitability. The information systems providing feedback that can be used to allocate resources effectively, such as inventory and personnel, are called tactical systems.

Subsystem Interfaces

As with other systems, there are interfaces between the subsystems of an information system. Again, the outputs of one subsystem become the inputs into the next. For example, the outputs of a sales order entry system become the inputs into an invoicing system. If the outputs of one system are not correct, however, the next subsystem will be affected. If the price of an item is entered incorrectly during order entry, then the charges to the customer may be incorrectly calculated during billing.

Internal Controls

Good information systems also have internal standards to make sure that data are processed accurately. Input controls, for example, ensure that input data are valid before they are processed. Another type of control is a password security procedure designed to protect against unauthorized access and update of data. All in all, standards make sure the system works properly. Without controls, the data printed out on reports may be inaccurate and managers may not be able to trust the information system to provide valid results. If unauthorized users update data files or if input data are not valid, managers may not even know that the output generated in reports is invalid, and thus may make decision using erroneous information.

Effect of the Systems Approach on Information Systems Design

Many of the ideas that are part of the systems approach have implications for the design of information systems. You can learn about the design of an information system by putting yourself in the shoes of an owner of a microcomputer dealership, for example. Systems have objectives, and in this case the owner’s objective is to make a profit on the sales of microcomputers, software, and related peripheral equipment.

The Structure of an Enterprise

The entire enterprise has been organized into subsystems, including the marketing subsystem, the service subsystem, and the administrative subsystem. The marketing subsystem promotes and markets microcomputer products and services. When customers have problems with their microcomputers or need preventive maintenance, they use the service subsystem. Finally, the administrative subsystem takes care of billing customers, purchasing equipment and supplies from vendors, paying vendors, and handling accounting activities.

The marketing subsystem of the dealership is managed by a sales manager who recruits salespeople, including experienced veterans and new trainees, to demonstrate and sell the equipment. These salespeople are trained to follow certain procedures, such as giving equipment demonstrations and making follow-up calls. These procedures are an important part of the “system” of selling microcomputer hardware and software. When they are not followed, profitability suffers.

The sales manager needs an information system to provide feedback on how the system is working. On a day-to-day basis, he may receive information about salespeople who have successfully closed sales, about customers who are complaining, and about technical problems with equipment. This feedback makes it possible to review the procedures and activities of the current system. For example, if a particular model of microcomputer is breaking down too often, the sales manager may encourage the salespeople to push alternative lines of equipment until technical problems are resolved with the manufacturer.

The sales manager also needs to organize personnel resources to achieve the desired objectives. If a certain salesperson is unable to make quota month after month, a more effective training program may be needed. If experienced salespeople seem to be selling more effectively to larger accounts, the sales manager may assign them to these accounts.

You can now see that the information the sales manager uses to monitor and control the activities of the marketing system is critical to achieving the objectives of the business. Some of this information may be obtained by word of mouth, and other information may be generated from a computer. A product profitability report, for example, may give the sales manager feedback on the product lines that generate the greatest gross profit. Whether the manager uses informal feedback or computer generated reports, the information is being used to organize people, procedures, and activities to accomplish objectives.

2.5 Using the systems approach in problem solving

An owner of a business like the microcomputer dealership must constantly analyze problems and reorganize the resources of the system to deal with these problems effectively. The system approach is a valuable method of problem solving that takes into account the goals, environment, and internal working of the system. The systems approach to problem solving involves the following steps:

  1. Define the problem.
  2. Gather data describing the problem.
  3. Identify alternative solutions.
  4. Evaluate these alternatives
  5. Select and implement the best alternative
  6. Follow up to determine if the solution is working

We can understand how the systems approach works by applying it to a problem that the microcomputer dealer might experience.

Define the Problem

The first step in the systems approach to problem solving is to define the problem. Defining the problem is one of the most important parts of the system study, because if the wrong problem is identified, the entire effort to change the system will be off track. At the outset, some of the problems that are identified may be symptoms of the real problem. In order to distinguish between symptoms and problems, it is necessary to gather data describing the problem. Let’s say that in this case the owner is concerned about the fact that many of the salespeople are not meeting their quotas. She decides to start a systems study by collecting more information about the problem.

Gather Data describing the Problem

The owner may study the environment, current standards, management, input resources, and internal procedures to gain an understanding of the problem. The first place the owner might look is the environment. The environment of the microcomputer dealer includes its vendors, its customers, its competitors, and the local community. From this investigation, the owner might learn that local competitors are selling comparable microcomputers at prices 10 percent less than the firm can offer.

Next, she might look at the dealership’s standards to determine if they are valid in the face of the competitive environment. It might turn out that a goal of increasing gross sales by 10 percent for the year is unrealistic when the competition is cutting price.

Another area that could be analyzed is management. The owner needs to learn if the sales manager is doing a good job. If the sales manager is not providing salespeople with effective training the feedback regarding their performance, they may feel frustrated.

Input resources are another area that should be analyzed. The owner needs to find out if new sales and technical representatives are being recruited and if these employees are trained to demonstrate computer equipment and software. If new recruits lack knowledge of the technical features of the equipment, for example, they will fail to win new business. If sales materials are not kept up to date, customers may not learn about new product features.

Work methods and procedures also need to be studied. If salespeople are not trained to follow up on new prospects, the company could lose valuable business. If technical support personnel cannot diagnose and solve service problems on a timely basis, customers may be hesitant to purchase more equipment.

One of the major problems identified in this case is that competitors are charging lower prices for comparable products. Many of the difficulties the dealer has identified are symptoms of this fundamental problem. To address it, the owner has to identify and evaluate some alternatives.

Identify Alternative Solutions

Given the fact that competitors have dropped their prices on comparable microcomputers, the owner needs to identify some alternatives responses. These alternatives might include the following:

Alternative 1: Investigate alternative manufactures of microcomputers to obtain products at a lower cost per unit.

Alternative 2: Decrease the cost of sales by introducing mail-order sales supported by telemarketing. Use salespersons for large accounts only. Cutting the cost of sales efforts would make it possible to reduce machine prices to a more competitive level.

Alternative 3: Differentiate the products being sold by offering on-line diagnostic support services for machine failure, service response time within 5 hours on a 24- hour basis, and annual service checks.

Each of these alternatives supports a slightly different strategy. Finding lower-cost manufactured goods would represent a cost-cutting strategy. The second alternative, suing mail-order sales and telemarketing, would also support a low-cost strategy because the cost of mail-order sales would be less than the cost of a larger sales staff. Finally, introduction on-line diagnostic support services would provide a “value-added” feature. Upgraded technical support would justify slightly higher equipment costs.

Evaluate These Alternatives

The owner evaluates the extent to which each of these alternatives enables the organization to achieve its objectives. As we saw, the owner’s objective was to increase the overall performance of sales personnel. Purchasing lower-cost products from suppliers would enable the owners to cut prices, as suggested in the first alternative, but would create difficulty at the service end if these microcomputer products where less reliable. This might make it more difficult for salespeople to meet their objectives.

Introducing a mail-order program would cut the cost of sales overhead. However, the mail order program would require creating a database of customer prospects and developing specialized promotional materials. This strategy might free sales representatives to concentrate on direct sales to high potential accounts while using a less costly strategy to maintain the business of smaller accounts.

The final alternative would offer customers additional levels of service and technical support that add value to the firm’s products. Because service is one of the key criteria for microcomputer selection, this strategy might work. However, it is costly and might not satisfy the needs of economy conscious small businesses that represent a large potential market share.

Select and Implement the Best Alternative

Let’s say that the owner decides to develop and implement a mail order program to reduce the cost of sales overhead to smaller accounts and to enable sales personnel to focus on high potential accounts. Because this is a new strategy, the owner would have to recruit new customer service representatives or train others for telemarketing. Customer prospect databases would need to be developed and established, as well as a system for shipping merchandise, billing, and authorizing credit transactions.

Follow Up to Determine if the Solution Is Working

The last step in the systems approach to problem solving is follow-up. In the case of the mail order sales alternative, the owner would need to determine if the system was meeting its goals. If not, changes in management, standards, resources, and procedures would have to be made to achieve these objectives. If either one of the other two alternatives were selected, the owner also would need to follow up to determine if the approach was useful in improving sales effectiveness.

As you can see from this example, the systems approach to problem solving is an important technique for the manager. Every manager needs feedback to determine if the goals of the system are being achieved. One of the most difficult tasks in a systems study is identifying information that can be used to determine how the system is working. This is as true in an organization with a simple structure as it is in a more complex organization. The next section discusses the characteristics of organizations with different structure.

2.6 Systems Concepts in Organizations

  The organization is also a system. Henry Mintzberg, in his book The Structuring of Organizations, describes five basic parts of organizations and how they function together as a system in which material, information, and decision processes flow. Mintzberg also identified five different types of organizational structures, including the simple structure, the machine bureaucracy, the professional bureaucracy, the divisional zed form and the adhocracy.

The Five Parts of the Organization

The five parts of the organization are the operating core, the strategic apex, the middle line, the techno structure, and the support staff, as Figure 2-5 shows. The operating core is comprised of the operators that carry out the basic work of the organization. They obtain inputs, transform inputs into outputs, and distribute the outputs. They also provide direct support for these input, transformation, and output functions. You might think of the operating core of an automobile manufacturer as the assembly-line workers.

The administrative component of the organization is made up of the strategic apex, the middle line, and the techno structure. The strategic apex is top-level management. Top management is responsible for insuring that the organization services its mission.

                         Figure 2-5 the five basic parts of organization

Top managers are responsible for allocating resources, resolving conflicts, reviewing activities, disseminating information, and serving as spokespersons for the organization in dealing with the external environment. Most importantly, they develop the organization’s strategic plans.

The middle line consists of middle level managers who are below top managers in the chain of command. The middle-line managers are responsible for coordination and control of activities within their functional units. They allocate resources, initiate change, handle conflicts, monitor the environment, establish strategy, and negotiate with outsiders – all to serve the needs of their functional units.

The techno structure consists of analysts who help standardize the work of others within the organization to control outputs and adapt to the environment. Examples of groups in the techno structure are work-study analysts who standardize who processes, planning and budget analysts who standardize outputs, and personnel analysts-trainers who standardize skills used by the organization.

The fifth group in the organization, the support staff, is responsible for supporting the operating core outside the flow of operating work. Support groups include the cafeteria, legal, payroll, public relations, and research and development staffs.

The Organization as a System of Flows

The five parts of the organization are joined together by flows – of authority, work material, information, and decision processes. At the operating level, the parts moving the assembly line are work flows. Control information flows from the operating level to middle management and serves as feedback. As feedback information passes up through each level of the hierarchy, it becomes more highly aggregated until it reaches the strategic apex. Typically, information about exceptions passes upward through the hierarchy until it reaches a manager who has the formal authority to handle the situation. In addition, commands flow downward from top and middle management to the operating core.

The communications patterns within organizations vary depending upon the structure of the organization. In more traditional organizations, information is filtered as it moves upwards through the hierarchy. In emerging forms of “networked” organizations, informal communication may link members of a project team who represent diverse areas and who work in different locations. By learning about their communications patterns, you can understand how different types of organizations functioning by using feedback from both internal and external sources.

Types of Organizational Structures

In Mintzberg’s analysis, the five types of organizations – the simple structure, the machine bureaucracy, the professional bureaucracy, the divisionalied form, and the adhocracy – have unique ways of handling information and communications. As organizations become information-based, information becomes a shared resource that facilitates interaction among specialists in diverse areas. As information technology moves onto the desktop of every manager, it will become a vehicle that supports the transition to the more advanced networked forms of organization.

The Simple Structure: What do an automobile dealership, a middle-sized retail store, a small corporation runs by an aggressive entrepreneur, and brand-new government department have in common? They are all examples of the simple structure.

In the simple structure, information follows a traditional path through the hierarchy to the single chief executive, the major decision maker. One possible problem is that the leader may become so enmeshed in operating-level information that he or she forgets the strategic direction of the organization.

The Machine Bureaucracy: what do a national post office, a security agency, a steel company, an airline, and automobile companies have in common? They are all machine bureaucracies. Characteristics of the machine bureaucracy are a clearly defined hierarchy of authority, centralized power for decision-making and formal communications throughout the organization. At the operating core, you will find standardized procedures and a proliferation of rules and regulations. In the machine bureaucracy, analysts in the techno structure – work analysts, job designers, quality control engineers, and operations researchers – standardize work methods and procedures.

The Professional Bureaucracy: Universities, general hospitals, school systems, general accounting firms, and social work agencies are still another type of organization, the professional bureaucracy. The professional bureaucracy hires professionals who are specialists in their fields and gives them control over their work. Professionals work independently of the colleagues; they work closely with the clients they serve. Professionals have several tasks: diagnosing a client’s need, presenting one or more alternatives, and proceeding with a particular course of action.

The professional bureaucracy is a democratic form of organization, which means that information flows are widespread and diverse. Much of the feedback comes from the external environment. If the faculty of a business program doesn’t receive feedback from potential employers, they may not change programs to prepare graduates with the skills and knowledge they need to succeed in entry-level positions.

The Divisional zed Form: the divisional zed organization consists of a group of quasi-autonomous entities coupled together by a central administrative structure. There are divisionalized corporations and universities with multiple campuses. A corporation, for example, may have 15 different divisions – each with its own purchasing manufacturing, and marketing functions.

The divisional zed structure usually emerges in response to distinct markets. The divisionalized form works well when different products and services are offered to different markets. For example, a multidivisional corporation may have divisions selling copiers, computers, and printing presses to three different markets. Today, the corporate offices of divisionalized firms provide support services such as financial, legal, personnel services, market research, and research and development.

The key to managing a divisionalized enterprise is a management information system that alerts senior management to deviations in business performance. In this way, the strategic apex can correct fundamental problems of the business, shift resources, and focus on products and markets where business performance is strong. The tendency of the management information system that monitors division performance is to focus on such indicators as profit, sales growth, and return on investment.

The Adhocracy: what do a management consulting firm and an innovative theater project company have in common? They are both examples of an adhocracy, the fifth type of organizational structure. The adhocracy combines groups of specialists into small market based project teams. Each team is a task force designed to conduct a specific project. A high technology firm, for example, establishes interdisciplinary project teams consisting of highly trained experts. The adhocracy thrives in a rapidly changing environment with strong competition.

The function of management in an adhocracy is different from the other forms of organization. Top managers scan the external environment looking for new projects and sell their services to potential clients. Managers at various levels of the organization work to coordinate project-related activities. They serve as peers, not as supervisions. Their influence is derived from their expertise and interpersonal skills, not their position power.

Transition of the Information-Based Organization

The transition to the information-based organization is the transition from a traditional bureaucratic organization to a networked organization, or adhocracy. The role of information is different in these two types of organizations. In the traditional organization, information is “owned” by each functional area. Summary information is transmitted up through the hierarchy to senior management. In the adhocracy, information is shared. Teams with representatives from many different functional areas share access to common information resources, such as customer databases, accounting databases, and product development databases.

Check Your Progress Exercises

  1. Define the following terminologies:
  2. system          c. open systems
  3. subsystem d. closed systems
  4. Identify the steps involved in systems approach to problem solving.


  1. Discuss the five different types of organizational structures according to Mintzberg approach.


  1. For the following systems identify their boundaries (the activities involved with it).
  2. a house
  3. a football team
  4. a text book
  5. a soccer game

2.7 Summary

This unit has introduced systems concepts that provide a foundation for understanding information systems in general and management information systems in particular. Managers have to understand systems, their objectives, their components, and their activities. Information about how a system is working provides them with the feedback they need to allocate resources to achieve their business objectives. Depending on the objectives of a system, its components, standards, and interactions may differ.

We have seen that an information system provides feedback about the activities of the business. Information systems have the same characteristics as other systems, including inputs and outputs, processes that transform inputs into outputs, and methods of system control. In designing an information system, the output must be defined, the interactions must be established, and the standards of system control must be organized.

A management information system in particular must be designed to provide information for effective planning and control of business activities. Decision making requires converting data into information. Information is data that have meaning in the decision-making process. An information system must be designed to provide feedback for the business system. This feedback can be used to reorganize, simplify, and improve activities in the business system so that goals are more effectively achieved. In the information-based organization, it is critical for managers to define their information needs and to use information as feedback.

2.8 Answer to Check Your Progress Exercise

  1. A system is an integrated set of components, or entities, that interact to achieve a particular function or goal. Systems have characteristics such as boundaries, outputs and inputs…
  • Systems are composed of interrelated and interdependent subsystems.
  • Open systems operate in an external environment and exchange information and material with that environment. The external environment consists of the activities external to the system boundary with which the system can interact.

           (For more on this refer back to part 2.2 and 2.3)

  1. – Define the problem.

        –   Gather data describing the problem.

        –   Identify alternative solutions.

        –   Evaluate these alternatives

        –   Select and implement the best alternative

        –   Follow up to determine if the solution is working

  1. The five types of organizational structure include the simple structure, the machine bureaucracy, the professional bureaucracy, the divisionalized form and the adhocracy.
  2. Refer back to part 2.3 and 2.4

Unit 3: Computer Hardware


3.0 Aims and Objectives

  • Introduction
  • The Hardware of a Computer System
    • Primary Storage
    • Central Processing Unit
    • Input Devices
    • Output Devices
    • Secondary Storage
    • Others
  • Summary
  • Answer to Check Your Progress Exercise

3.0 Aims and Objectives

After studying this unit, you will be able to explain

  • what a hardware is
  • the various components of a computer systems
  • the various input devices
  • the various output devices
  • the various storage devices

3.1 Introduction

A contemporary computer system consists of a central processing unit, primary storage, secondary storage, input devices, output devices, and communication devices.

The central processing unit manipulates raw data into a more useful form and controls the other parts of the computer system.

Primary storage temporarily stores data and program instructions during processing, while secondary storage devices (magnetic and optical disks, magnetic tape) store data and programs when they are not being used in processing.

Input devices, such as keyboards or the computer “mouse”, convert data and instructions into electronic form for input into the computer.

Output devices, such as printer, video display terminals, convert electronic data produced by the computer system and display it in a form that people can understand.

Communication devices provide connections between the computer and communication networks.

Buses are path for transmitting data and signals between the various parts of the computer system.

3.2 The Hardware of a Computer System

The hardware of a computer system consists of primary storage, central processing unit. Input devices, secondary storage devices, output devices and communication devices. The following figure represents the computer hardware.

Figure 3.1: Computer Hardware

3.2.1 Primary Storage

Primary storage has three functions. It stores all or part of the program that is being executed. Primary storage also stores the operation systems programs that manage the operation of the computer. Finally, the primary storage area holds data that are being used by the program. Data and program are placed in primary storage before processing, between processing steps, and after processing has ended, prior to being returned to secondary storage or released as output.

Internal primary storage is often called RAM, or Random Access Memory. It is called RAM because it can directly access any randomly chosen location in the same amount of time.

The advantage of electronic information storage is the ability to store information in a precise known location in money and to retrieve it from that same location.

Most of the information used by a computer application is stored on secondary storage devices such as disks, and tapes, located outside the primary storage area. In order for the computer to do work on information, information must be transferred into primary memory for processing. Therefore, data are continually being read into and written out of the primary storage area during the execution of a program.

Primary storage is actually composed of semi conductors. A semi conductor is an integrated circuit made by printing thousands and even millions of tiny transactions on a small silicon chip. There are several different kinds of semi conductor memory used in primary storage, RAM, or random access memory, is used for short term storage of data or program instructions. RAM is volatile: its contents will be lost when the computer’s electric supply is disrupted by a power outage or when the computer is turned off.

ROM, or Read Only Memory, can be only being read from. It cannot be written to. ROM chips come from the manufacturer with programs already “burned in” or stored. ROM is used in general-purpose computers to store important or frequently used programs (such as computing routines for calculating the square root of numbers).

Other uses for ROM chips are the storage of manufacturer specific micro codes such as the Basic Input Output System (BIOS) chip used on IBM personal computer, which controls the handling of data within the machine.

There are two other subclasses of ROM chips: PROM or programmable read only memory, and EPROM, or Erasable Programmable Read Only Memory.

PROM chips are used by manufacturers as control devices in their products. They can be programmed once. PROM chips therefore can be made universally for many manufacturers in large production runs.

EPROM chips are used for device control, such as in robots, where the program may have to be changed on a routine basis with EPROM chips, the program can be erased and reprogrammed.

3.2.2 Central Processing Unit (CPU)

The central processing unit (CPU) is the part of the computer system where the manipulation of symbols, numbers, and letter occurs, and it controls the other parts of the computer system.

The CPU consists of central unit and an arithmetic logical unit. Located near the CPU is primary storage (sometimes called primary memory or main memory) where data and program instructions are stored temporarily during processing. Three kinds of buses link the CPU, primary storage, and the other devices in the computer system. The data bus moves data to and from primary storage. The control bus transmits signals specifying whether to “read” or “write” data to or from a given primary storage address, input device, or output device. The characteristics of the CPU and primary storage are very important in determining the speed and capability of a computer.

  1. Arithmetic and Logical Unit

The arithmetic logical unit (ALU) performs the principal logical and arithmetic operations of the computer. It adds, subtracts, multiplies, and divides, determining whether a number is positive, negative, or zero. In addition to performing arithmetic function and ALU must be able to determine when quantity is is greater than or less than another and when two quantities are equal. The ALU can perform logical operations on the binary codes for letters as well as numbers.

  1. Control Unit

The control unit coordinates and control the other parts of the computer system. It reads a stored program, one instruction at a time, and directs other components of the computer system to perform the tasks required by the program. The services of operations required to process a single machine instruction is called the machine cycle. The machine cycle has two parts: an instruction cycle and an execution cycle.

During the instruction cycle, the control unit retrieves are program instruction from primary storage and decodes it. It places the part of the instruction telling the ALU what to do next in a special instruction register and places the part specifying the address of the data to be used in the operation into an address register.

During the execution cycle, the control unit locates the required data in primary storage, places it in a storage register, instructs the ALU to perform the desired operation, temporary stores the result of the operation in the accumulator, and finally places the result into primary memory. As the execution of each instruction is completed, the control unit advances to and reads the next instruction of the program.

Figure 3.2: The various steps in the machine cycle (I – Cycle and E – Cycle)

3.2.3 Input Devices

The traditional method of data entry has been by keyboarding. Today most data are entered directly into the computer using a data entry terminal and they are produced online.

For instance, online-airline reservation and customer information systems have reservations clerks or salespeople enter transaction directly while dealing with the customer, and their systems are updated immediately. In this manner, a business can eliminate a separate data entry staff and the associated costs.

  1. Keyboard

Keyboard is the most common input device. Depending on the number of function keys, keyboard can be categorized as a standard or enhanced. Standard keyboards have 10 function keys while the enhanced keyboards have 12 function keys.

  1. The computer mouse

The “point and click” actions of the computer mouse have made it an increasingly popular alternative to keyboard and text-based commands. A mouse is a hand held device that is usually connected to computer by a cable. The computer user moves the mouse around on a desktop to control the position of the curser on a video display screen. Once the cursor is in the desired position, the user can push a button on the mouse to select a command. The mouse can also be used to “draw” images on the screen.

  1. Touch Screens

Touch screens are easy to use and are appealing to people who cannot use traditional keyboards. Users can enter limited amounts of data by touching the surface of a sensitized video display monitor with a finger or a pointer. With colorful graphics, sound, and simple menus, touch screen allow the user to make selections by touching specified parts of the screen.

  1. Source data automation

Source data automation captures data in computer readable form at the time and place they are created. Point of sale systems, optical bar code scanners used in supermarkets, and other optical character recognition device are examples of source data automation. One of the advantages of source data automation is that the many errors that occur when people use keyboards to enter data are almost eliminated.

The principal source data automation technologies are magnetic ink character recognition, optical character recognition, and pen based input, digital scanner, voice input, and sensors.

  • Magnetic link character recognition (MICR)

This technology is used primarily in check processing for the banking industry. The bottom portion of a typical check contains characters that are pre printed using a special ink.

A MICR reader translates the characters on check that have been cashed and sent to the bank for processing into digital form for the computer. The amount of the check, which is written in ordinary ink, must be keyed in by hand.

  • Optical character recognition (OCR)

This device translates specially designed marks, characters, and codes into digital form. The most widely used optical code is the bar code, which is used as a point of sale systems in supermarkets and retail stores.

·        Pen based inputs

Handwriting recognition devices such as pen-based “tablets” and “notebooks” are promising new input technologies, especially for people working in the sales or service areas or for those who have traditionally shunned computer key boards. These pen based input devices usually consist of a flat screen display tablet and a pen like stylus.

With pen-based input, users print directly on to the tablet sized screen. The screen is fitted with a transparent grid of five wires that detects the presence of the special stylus, which emits a faint signal from its tip. The screen can also interpret tapping and flicking gestures made with the stylus.

Pen based input devices transform the letters and numbers written by users on the tablet into digital form, where they can be stored, or processed and analyzed.

·        Digital scanners

Digital scanners translate images such as pictures or documents into digital form, and are an essential component of image processing system.

·        Voice input devices

Voice input devices converts’ spoken word into digital form. Voice recognition software compares the electrical patterns produced by the speaker’s voice to a set of pre recorded patterns. If the patterns match, the input is accepted. Most voice system still has limited “vocabularies” of several hundred to several thousand words and can accept only very simple commands.

·        Sensors

Sensors are devices that collect data directly from the environment for input into a computer system. The sensors continuously measure emission and are linked to micro computers which send the data collected by the sensors to the central computer for analysis.

3.2.4 Output Devices

The major data output devices are cathode ray tube (CRT) terminals (sometimes called video display terminals, or VDTs, and printers.

  1. CRT

The CRT is probably the most popular form of information output in modern computer system. It works much like a television picture tube, with an electronic “gun” shouting a beam of electrons to illuminate the pixels on the screen. The more pixels for screen, the higher the resolution. CRT monitor can be classified as monochrome or color and by their display capabilities. Some display only text, whereas others display both text and graphics. Typical CRT display 80 column and 24 lines of text data. Display devices for graphics often utilize bit   mapping. Bit mapping allows each pixel on the screen to be addressed and manipulated by the computer. This requires more computer memory but permits finer detail and the ability to produce any kind of image on the display screen. 

2 Printers

Printers produce a printed hard copy of information output. They include impact printers (a standard typewriter or a dot matrix) and non-impact printers (laser, inkjet, and thermal transfer printers). Most printers print one character at a time, but some commercial printers print an entire line or page at a time. Impact printers are slower than non-impact printers. Laser printers for micro computers can print 4 to 8 pages per minute. Laser printers in large computers center can print over 100 pages per minute.

  1. Other devices

Microfilm and micro fiche have been used to compactly store output as microscopic filmed images, and they are mainly used by insurance companies or other firms that need to output and store large number of documents.

  1. Plotters

Plotters are output device using multicolored pens to draw high quality graphic documents. Plotters are much slower than printers, but are useful for outputting large size charts, maps or drawings.

  1. Voice output device

A voice output device converts digital output data back into intelligible speech; sounds are prerecorded, coded, and stored on disk, to be translated back as spoken words. For instance, when you call for information on the telephone, you may hear a computer “voice” respond with the telephone number you requested.

3.2.5 Secondary Storage

In addition to primary storage, where information and programs are stored for immediate processing, modern computer systems need to store information outside of the computer in a non-volatile state and to store volumes of data too large to fit into a computer of any size today. The relative long-term storage of data outside the CPU and primary storage is called secondary storage.

1. Magnetic tape

Magnetic tape is an older device that is still important for secondary storage of large volume of information. It is used primarily in manufacture batch application and for archiving data. Generally magnetic tape for large system comes in 14-inch reels that are up to 2400 feet long and 0.5 inches wide. It is the very similar to home cassette recording tape, but of higher quality.

The principal advantage of magnetic tape are that it is inexpensive, that it is relatively stable, and that it can store very large volumes of information. It is a reliable technology because of several self-checking features, and therefore is an ideal form of backup storage for other more volatile forms of memory. Moreover, magnetic tape can be used over and over again, although it does not age with time and computer users must handle it carefully.

The principal disadvantages of magnetic tape are that it stores data sequentially and is relatively slow compared to the speed of other secondary storage media. In order to find an individual record stored on a magnetic tape, the tape must be read from the beginning up to the location of the desired record. This means that the CPU must read each name from A-Z. Hence, magnetic tape is not good medium when it is necessary to find information rapidly. Tape can also be damaged and is labor intensive to mount and dismount.

2.  Magnetic Disk

The most widely used secondary storage medium today is magnetic disk. There are two types of magnetic disks: floppy disks and hard disks. Hard disks are thin steel plates with an iron oxide coating. In large systems, multiple hard disks are mounted together on a vertical shaft. Here the read write head (disk and drive) are sealed together. That is why these devices sometimes are called hard drives. A hard disk is found in the system unit. It is not removable.

Information is recorded on a read from the disk by read/write heads, which literally fly over the spinning disks.

The read/write heads move horizontally (from left to right) to any of 200 positions called cylinders. At any one of these cylinders, the read/write heads can read or write information to any of 20 different concentric circles at the disk surface areas (called tracks). The cylinder represents the circular tracks on the same vertical line within the disk pack. Read/write heads are directed to a specific record using an address consisting of the cylinder number, the recording surface number, and the data record number.

The speed of access to data on a disk is a function of the rotational speed of the disk and the speed of the access arms. The read/write heads must position themselves, and the disk pack must rotate until the proper information is located. More advanced and expensive disks have access speeds of 1.5 – 10 milliseconds.

The read write head of the hard drive will be suspended above disk with a very small amount (0.00001 inch) of distance between the disk and the head. During power failure, or if you bumping the system unit or even drop something on it, then the head can touch the disk and that will be a problem called head crash. Head crash may cause a damage of some data, byte or totally hard disk.

The advantage of having a hard disk is they have high storage capacity, and are faster. The storage capacity can exceed up to 50 GB. That means:

1 byte              =          1 character

1 kilobyte        =          1024 characters

1megabyte       =          1048576 characters

1 gigabyte       =          107341824 characters

  1. Floppy disks

Floppy disks are a removable magnetic disks primarily used with microcomputers. The two most common standard sizes are 3.5 inch and 5.25 inch disks that are made up of polyester film with magnetic coating.

These disks have a storage capacity ranging from 360 k to 2.8 megabytes and a much slower access rate than hard disks. Floppy disks and cartridge and packs of multiple disks use a sector method for storing data. The disk surface is divided into pie-shaped pieces, the actual number of depending on the system used (some disks used 8 sectors others nine). In most types of floppy disks, each sector has the same storage capacity (data are recorded more densely on the inner disk tracks). Each sector is assigned a unique number. Data can be located using an address consisting of the sector number and an individual data record number.

Magnetic disks on both large and small computers have several important advantages over magnetic tape. First, they permit direct access to individual records. Each record can be given a precise physical address in terms of cylinders and tracks, and the read/write head can be directed to go to that address and access the information is about 10 to 60 milliseconds. This means that the computer system does not have to search the entire file, as in a tape file in order to find a record. This creates the possibility for online information system providing an immediate response, such as an airline reservation or customer information system. Disk storage is often referred to as a direct access storage device (DASD).

 Floppy Disks (diskettes) are mobile storage devices (their special feature comparing with hard disks) and you need to have a floppy drive to use them. A floppy drive is the one that reads and writes data on the floppy disk. They are inexpensive but their storage capacity is only about 1.44MB. The following figures illustrate the structure and components of the floppy disks.

The Structure of Floppy Disks:

  1. Shatter: is used to protect the data access area from the external environment. If there is any disturbance, then there will be data loss.
  2. The Data Access Area: when the drive reads and writes data, then the data access area is the area where the read-write head scans the actual data medium, which is the magnetic film.
  3. Hub: when inserting the disk to the disk drive, the hub will be fit to the drive spindle and the disk can be spin.
  4. Label: part of the disk, just used to write labels for the disk to distinguish it from other diskettes.
  5. Write-Protect Notch: is a hole used to make the floppy disk read only. If it is open, data cannot be recorded and the diskette is said to be write-protected. It is possible to open or close the notch by sliding a cover, which is found with the hole.
  6. Magnetic Film: this is where data can be read or recorded. Usually iron oxide coated this part.

A formatted floppy is different from unformatted diskettes with one major thing: the presence or absence of tracks and sectors on the magnetic film.

A formatted (as a result ready to use) disk has its magnets film divided into thin concentric circles, called tracks and the tracks themselves are divided into sectors. The drive can not read and write unless the disk has tracks and sectors.

  1. Optical Disks

Optical disks, also called compact disks or laser optical disks, stores data at densities many times greater than those of magnetic disks and are available for both micro computers and large computers. Data are recorded on optical disks when a laser device burns microscopic pits in the reflective layer of a spiral track. Binary information is encoded by the length of these pits and the space between them.

Optical disks can thus store massive quantities of data, including not only text but also pictures, sound, and full motion video, in a highly compact form. The optical disk is read by having a low power laser beam from an optical head scan the disk.

  • Compact disk read only memory (CD-ROM)

The most common optical disk system used with micro computers is called CR-ROM. A4.75 inch compact disk can store up to 660 megabytes, nearly 300 times more than a high density floppy disks. Optical disks are most appropriate for applications where enormous quantities of unchanging data must be stored compactly for easy retrieval, or for storing graphic linkages and sounds.

CD-ROM is also less vulnerable than floppy disks to magnetism, dirt or rough handling. CD-ROM is read only storage. No new data can be written to it. It can only be read. CD-ROM has been most widely used for reference materials with massive amounts of data, such as encyclopedias, directories, or online database and for storing multimedia applications that combine text, sound and images.

  • Write once/read many (WORM) (CD-R)

WORM are optical disk systems that allow users to record data only once on an optical disk. Once written, the data cannot be erased but can be read indefinitely. WORM has been used as an alternative to micro film for archiving digitized document images. The disadvantages of CD-ROM and WORM optical disks are then contents cannot be easily erased and written and, as can be done with magnetic disks, and the access speed is lower than that of magnetic disks.

  • Magneto optical disks (CD-RW)

Re-writable magneto optical disks are starting to become cost effective for data storage. The disk surface is coated with a magnetic material that can change magnetic polarity only when heated. To record data, a high-powered laser beam heats tiny spots in the magnetic medium that allows it to accept magnetic patterns.

Data can be read by showing a lower powered laser beam at the magnetic layer and reading the reflected light. The magneto optical disk is erasable and can be written on nearly a million times. The access speed of optical disks, while slower than that of magnetic disks, is continuing to improve, making the optical disk a very attractive storage technology in coming years.

3.2.6 Other Devices

In addition to the main hardware components, we have a number of parts of a computer that are not mentioned. To state some of them:

  1. Motherboard

It is the main board containing the CPU, RAM, ROM and additionally different expansion slots.

Expansion Slots and Expansion Cards

Most PCs are expandable. Users are able to expand the power and speed of the computer. How? This is just by adding expansion cards (boards) into your hardware. There are different kinds of expansion cards and they will be plugged into the expansion slots found on the motherboard. Examples of expansion cards can be sound card, display adapters, modem, and network cards.

  1. Power Supply

Electrical power is needed almost for every components of the PC. And the components will get their need from the power supply which is found inside the system unit. The power supply has got usually two sockets at the back of the system unit where you can plug power cable for the system unit from outside main power source and the other a power cable from the monitor. Moreover the power supply contains fun to make things cool inside the system unit.

Devices used to Prevent Power Problems  

  • UPS (Uninterruptible Power Supply): will provide power to the computer for some period of time (from 5 to 30 minutes) when there is power failure. This is possible because the UPS has batteries that will be charged and hold electric power. That will give you time at least to save your data on RAM and shut down the PC properly.
  • Surge Protector (Surge Suppressor):

Whenever there is a power fluctuation (especially when surges occur), these devices can protect the computer by absorbing the high voltage.

  • Line Conditioner (Voltage Regulator)

It protects the computer from insufficient power.

  1. Bus

A bus is simply an electronic pathway between the CPU and other devices. It can transmit electronic information (in fact composed of bits) between devices.

  1. Port

A port is a socket at the back of the system unit which can be used to plug a cable from peripheral devices like monitors, keyboards etc.

Check Your Progress Exercise

  1. What are the components of a contemporary computer system?


  1. Discuss the major components of the CPU.


  1. Explain the difference between primary and secondary storage?


  1. List and describe the major input device?


  1. List and describe the major output devices?


3.3 Summary

The modern computer system has six major components: a central processing unit (CPU), primary storage, input devices, output devices, and secondary storage and communication devices.

The CPU has two components: an arithmetic logic unit and control unit. The arithmetic and logic unit performs arithmetic and logical operations on data, while the control units controls and coordinates the other components of a computer.

The CPU is closely tied to primary memory, or primary storage, which stores data and program instructions temporarily before and after processing.

The principal input devices are keyboards, computer mouse, touch screens, magnetic ink and optical character recognition, pen based instruments, digital scanners, sensors and voice input.

The principal output devices are video displays, terminals, printers, plotters, voice output devices, and microfilm and microfiche.

The principal form of secondary storage is magnetic tape, magnetic disks, and optical disks.

3.4 Answer to Check Your Progress Exercise

  1. Refer Section 3.2
  2. Refer Section 3.2.2
  3. Refer Section 3.2.1 & 3.2.5
  4. Refer Section 3.2.3
  5. Refer Section 3.2.4



4.0 Aims and Objectives

  • Introduction
  • Types of System Software
    • Function of Operating System
    • Micro Computer Operating Systems
    • Operating System Capabilities
    • Language Translation and Utility Program
  • Application Software
    • Generation of Programming Languages
    • Popular Programming Languages
    • Fourth Generation Languages
    • New Software Tools and Approaches
  • Summary
  • Answer to Check Your Progress Exercise

4.0 Aims and Objectives

After studying this unit, you will be able to explain

  • what software is
  • the major types of software
  • the major functions of operating systems
  • the major types of application software

4.1 Introduction

Software is a detailed instruction that control the operations of a computer system. Without software, computer hardware could not perform the task we associate with computers. The functions of software are to:

  • manage the computer resources of the organization
  • provide tools for human beings to take advantage of these resources; and
  • Act as an intermediary between organization and stored information.

A software program is a series of statements or instructions to the computer. The process of writing or coding programs is termed programming and individuals who specialize in this task are called programmers.

The stored program concept means that a program must be stored in the computer’s primary storage along with the required data in order to execute, or have its instructions performed by the computer. Once the program has finished executing, the computer hardware can be used for another task when a new program is loaded into memory.

4.2 Types of System Software

There are two types of software: systems software and application software.

1. System Software

System software is a set of generalized programs that manage the resources of the computer, such as the central processor, communications links, and peripheral devices. Programmers who write system software are called system programmers.

Application software describes the programs that are written for or by users to apply the computer to a specific task. Software for processing an order or generating a mailing list is application software. Programmers who write Application software are called application programmers.

The types of software are interrelated and can be thought of as a set of nested boxes, each of which must interact closely with the other boxes surrounding it. The system software surrounds and controls access to the hardware. Application software must work through the system software in order to operate. End users work primarily with application software. Each type of software must be specially designed to a specific machine in order to ensure its compatibility. The following figure illustrates the relationship.

Figure 4.1: The major types of software

Application software

  • programming language
  • assembly language
  • Fortran, CoBol, PL/l, BASIC, PASCAL, C

System software coordinates the various parts of the computer system and mediates between application software and computer hardware.

The system software that manages and controls the activities of the compute is called operating system. Other system software consists of computer language translation programs that convert programming languages into machine language and utility program that perform common processing tasks.

4.2.1 Functions of the Operating System

Operating system is the system software that manages and controls the activities of the computer. One way to look at the operating system is as the system’s chief manager. Operating system software decides which computer resources will be used, which programs will be run, and the order in which activities will take place.

An operating system performs three functions. It allocates and assigns system resources. It schedules the use of computer resources and computer jobs; and it monitors computer system activities.

  1. Allocation and assignments: The operating system allocates resources to the application jobs in the execution queue. It provides locations in primary memory for data and programs and controls the input and output devices such as printers, terminals, and telecommunication links.
  2. Scheduling: thousand of pieces of work can be going on in a computer simultaneously. The operating system decides when to schedule the jobs that have been submitted and when to coordinate the scheduling in various areas of the computer so that different parts of different jobs can be worked on at the same time.
  • Monitoring: the operating system monitors the activities of the computer job and may also keep track of who is using the system, of what programs have been run, and of any unauthorized attempts to access the system.

4.2.2 Micro Computer Operating Systems

Like any other software, micro computer software is based on specific operation systems and computer hardware. A software package written for one microcomputer operating system generally cannot run on another. The microcomputer operating system they have distinct features – such as whether they support multitasking or graphics work that determine the types of applications they are suited for. The widely used microcomputers operating systems are: DOS, Windows 95, Windows NT, OS/2, UNIX, and system 7.

  1. DOS: (Disk Operating System): is an operating system for 16 bit microcomputers based on the IBM personal computer standard. DOS was the most popular operating system for 16 bit microcomputers. It is still widely used today with more powerful microcomputers based on the IBM microcomputer standard because so much available application software has been written for systems using DOS. (PC-DOS is used exclusively with IBM microcomputers. MS-DOS, developed by Microsoft, is used with other 16 bit microcomputers that function like the IBM microcomputer. DOS itself does not support multitasking and limits the size of a program in memory to 640k.

DOS itself is command driven, but it can present a graphical user interface by using Microsoft windows, a highly popular graphical user interface shell that runs in conjunction with the DOS operating systems. Windows support multitasking and same form of networking but shares the memory limitations of DOS.

  1. Windows 95: Microsoft’s Windows 95 is a 32 bit operating system designed to remedy many of the deficiencies of DOS. A 32 bit operating system can run faster than DOS because it can address data in 32 bit chunks.

Windows 95 provides a streamlined graphical user interface that arranges icons to provide instant access to common tasks. It can support software written for DOS and Windows but it can also run programs that take up more than 640k of memory. Windows 95 features multitasking, multithreading (the ability to manage multiple independent tasks simultaneously), and powerful networking capabilities, including the capability to integrate fax, e-mail, and scheduling programs. The operating system requires a fast 386 or 486 microprocessor, 8 megabytes of RAM, and 24-48 megabytes of hard disk storage. Advanced Microsoft windows operating systems are widely in use today. To name a few: Windows 98, Window 2000, and Window XP.

  • Windows NT: is another operating system developed by Microsoft with features that make it appropriate for critical applications in large networked organizations. Windows NT uses the same graphical user interface as Windows but it has powerful multitasking and memory management capabilities. Windows NT can support existing software written for DOS and Windows, and it can provide mainframe like computing power for new applications with massive memory and file requirements. It can address data in 32 bit chunks if required and can even support multiprocessing with multiple CPUs.
  1. OS/2 (Operating System/2): is a powerful operating system used with 32 bit IBM personal system/2 micro computer workstations that support multitasking, networking, and more memory intensive applications than DOS.

   OS/2 is being used for more complex memory intensive applications or those that require networking, multitasking or large programs. OS/2 supports multitasking, accommodates larger applications, allows applications to be run simultaneously, supports networked multimedia and pen computing applications, and is much more protected operating system.

This operating system requires powerful computer hardware – a minimum 80386 or 80486 microprocessor, 4 megabytes of RAM, and a 60 megabytes hard disk. OS/2 provides powerful system – like capabilities, such as multitasking and supporting multiple users in networks.

  1. Unix: was developed at Bell laboratories in 1969 to help scientific researchers share data and programs while keeping other information private. It is an interactive, multi user, multi tasking operating system. Many people can use UNIX simultaneously to perform the same kind of task, or one user can run many tasks on UNIX highly supportive of communication and networking.
UNIX was initially designed for minicomputers but now has versions for microcomputers, workstations, and mainframes. UNIX can run on many different kinds of computers and can be easily customized. It can also store and manage a large number of files. At present, UNIX is primarily used for workstations, minicomputers, and inexpensive multi-user environments in small businesses, but its use in large business is growing because of its machine – independence.
  1. System 7: is the latest version of Macintosh system software, features multitasking as well as powerful graphics capabilities, and mouse driven graphical user interface. An extension of this operating system called Quick Time allows Macintosh users to integrate video clips, stereo sounds, and animated sequences with conventional text and graphics software.

4.2.3 Operating System Capabilities

How is it possible for 1000 or more users sitting at remote terminals to use a computer information system simultaneously? Can a computer execute only one instruction from one program at a time? How can computers run thousands of programs? The answer is that the computer has a sense of specialized operating system capabilities. These includes: multiprogramming; virtual storage, time sharing; and multiprocessing.

  1. Multiprogramming: the most important operating system capability for sharing computer resource is multiprogramming. Multiprogramming permits multiple programs to share a computer system’s resources at any one time through concurrent use of a CPU. By concurrent use, we mean that only one program is actually using the CPU at any given moment but that the input/output needs of other programs can be serviced at the same time. Two or more programs are active at the same time, but they do not use the same computer resources simultaneously. With multiprogramming, a group of programs takes turns using the processor.

Consider the following figure

Figure4.2: Single Vs Multiprogramming Environment

The above figure shows how three programs in a multiprogramming environment can be stored in primary storage. The first program executes until an input/output event is read in the program. The operating system then directs a channel (a small processor limited to input and output functions) to read the input and move the output to an output device. The CPU moves to the second program until an input/output statement occurs. At this point, the CPU switches to the execution of the third program, and so forth, until eventually all three programs have been executed.

  1. Multitasking: refers to multiprogramming on single user operating systems such as those in microcomputers. One person can run two or more programs concurrently on a single computer. For example, a sales representative could write a letter to prospective clients with a word processing program while simultaneously using a database program to search for all sales contacts in a particular city or geographic area. Multitasking allows the sales representatives to display both programs on the computer screen and work with them at the same time.
  2. Virtual storage: was developed after some problems of multiprogramming became apparent. Virtual storage handles programs more efficiently because the computer divides the programs into small fixed or variable length portions, storing only a small portion of the program in primary memory at one time.

First, although two or three large programs can be read into memory, a certain part of main memory generally remains underutilized because the programs add up to less than the total amount of primary storage space available.

Second, given the limited size of primary memory, only a small number of programs can reside in primary storage at any given time. Only a few statements of a program actually execute at any given moment. Virtual storage takes advantage of this feature of processing. Virtual storage breaks a program into a number of fixed length portions called pages or into variable length portions called segments.  Each of these portions is relatively small (a page is approximately 2 to 4 kilobytes). This permits a very large number of programs to reside in primary memory, in as much as only one page of each program is actually located there. Consider the following figure:

Figure 4.3: Virtual storage

As you see from the above figure, all other programs pages are stored on a peripheral disk unit until they are ready for execution. Virtual storage provides a number of advantages. First, the central processor is utilized more fully. Many other programs can be in primary storage because only one page of each program actually resides there. Second, programmers no longer have to worry about the size of the primary storage area.

  1. Time sharing: is an operating system capability that allows many users to share computer processing resources simultaneously. It differs from multiprogramming is that the CPU spends a fixed amount of time on one program before moving onto another. In a time sharing environment, thousands of users are each allocated a tiny slice of computer time (2 milliseconds).
  2. Multiprocessing: is an operating system capability that links together two or more CPUs to work in parallel in a single computer system. The operating system can assign multiple CPUs to execute different instructions from the same program or from different programs simultaneously, dividing the work between the CPUs. While multiprogramming uses concurrent processing with one CPU, multiprocessing uses simultaneous processing with multiple CPUs.

4.2.4 Language Translation and Utility Software

When computers execute programs written in languages such as COBOL, FORTRAN, or C, the computer must convert these “human readable” instructions into a form it can understand. Computers interpret binary ones and zeros, and the language translator found in system software makes the conversion. This type of system software is called a compiler or interpreter. The program in the high-level language before translation into machine language is called source code. A compiler translates source code into machine code called object code.

Some programming languages like BASIC do not use a compiler but an interpreter, which translates each source code statement one at a time into machine code and executes it. Interpreter languages like BASIC provide immediate feedback to the programmer if a mistake is made, but they are very slow to execute because they are translated one statement at a time.

An assembler is similar to compiler but is used to translate only assembly language into machine code. System software includes utility programs for routine, repetitive tasks, such as copying.

The source code, the program in a high level language is translated by the computer is to object code so that the instructions can be “understood” by the machine. These are grouped into modules. Prior to execution, the object code modules are joined together by the linkage editor to create the load module. It is the load module that is actually executed by the computer.

Clearing primary storage, computing a square root, or sorting. If you have worked on computer and have performed such functions as setting up new files, deleting old files, or formatting diskettes, you have worked with utility programs.

Utility programs are pre written programs that are stored so that they can be shared by all users of a computer system and can be rapidly used in much different information system application when requested.


Graphical User Interfaces

Whenever users interact with a computer, even a microcomputer, the interaction is controlled by an operating system. The user interface is the part of an information system that users interact with. Users communicate with an operating system through the user interface of that operating system. Early microcomputer operating systems were command driven, but the graphical user interface, often called a GUI, has become the dominant model for the user interface or microcomputer operating systems.

Many graphical user interfaces use a system of pull down menus to help users select commands and pop-up boxes to help users select among various command options. Windowing features allow users to create, stack, size, and move around various boxes of information. Graphical user interfaces can promote superior screen and print output communicated through graphics.

4.3 Application Software

Application software is primarily concerned with accomplishing the tasks of end users. Many different programming languages can be used to develop application software. Each has different strengths and drawbacks.

4.3.1 Generations of Programming Language

To communicate with the first generation of computers, programmers had to write programs in machine language – the Os and are of binary code. End users who wanted applications had to work unit’s specialized programmers who could understand, think and work directly in the machine language of a particular computer. Programming in Os and Is, reducing all statements such as add, subtract, and divide into a series of Os and Is, made early programming a slow, labor intensive process.

Machine language was the first generation programming language. The second generation of programming languages occurred in the early 1950s with the development of assembly language. Instead using Os and Is, programmers could now substitute language like acronyms and words such as add, sub (subtract), and load in programming statements. A language translator called a compiler converted the English like statements into machine language.

When the third hardware generation was underway, programming languages entered the third generation as well. From the mid 1950 – 1970, the first high level languages emerged. These languages permitted mathematicians for the first time to work with computers through the use of languages such as FORTRAN.

Mathematicians were now able to define variables with statements such as Z = A + B. The software translated these definitions and mathematical statements into a series of Os and Is. COBOL permitted the use of English statements such as print and sort to be used by programmers, who did not have to think in terms of Os and Is.

These higher-level languages require much faster, more efficient compilers to translate high-level languages into machine codes.

Fourth generation computer languages emerged in the late 1970s and their development are still in progress. These languages dramatically reduce programming time and make software tasks so easy that non-technical computer users can develop applications without the help of professional programmers. Fourth-generations tools also include pre-written application software packages that can be used directly by end users. Using the software package Lotus 1-2-3, for instance, users can create their own financial spreadsheets and manipulates data without programmer intervention.

4.3.2 Popular Programming Languages

Most managers need not be expert programmers, but they should understand how to evaluate software applications and to select programming languages that are appropriate for their organization’s objectives. The more popular high level languages are:

  1. Assembly language: is a programming language developed in the 1950s that resembles machine language but substitute mnemonics for numeric codes.

For example: AR 5, 3

This sample assembly language command adds the content of register 3 to register 5 and stores the result in register 5.

  1. FORTRAN (Formula Translator): is a programming language developed in 1956 for scientific and mathematical applications.

For example: READ (5,100) ID, Quant, PRICE

                          Total = QUANT * PRICE

This sample FORTRAN program code is part of a program to compute sales figures of a particular program.

  • COBOL (Common Business Oriented Language): COBOL is a predominant programming language for business applications because it can process large data files with alphanumeric characters.


This sample COBOL program code is part of a routine to compute total sales figures for a particular item.

  1. BASIC (Beginners All-Purpose Symbolic Instruction Code): BASIC is a general purpose programming language used with microcomputers and for teaching programming.
  2. PL/l (Programming Language): PL/l was developed by IBM in 1964. It is the most powerful general-purpose programming language because it can handle mathematical and business applications with ease, is highly efficient in input/output activities and can handle large volumes of data.
  3. Pascal: is a programming language used on microcomputers and to teach sound programming practices in computer science courses. The language is weak at file handling and input/output and is not easy for beginners to use.
  • C: is a powerful programming language with tight control and efficiency of execution. It is portable across different microprocessors etc.

4.3.3 Fourth Generation Languages

Fourth generation languages consist of a variety of software tools that enable end users to develop software applications with minimal or no technical assistance or that enhance the productivity of professional programmers.

Fourth generation languages tend to be non-procedural or less procedural than conventional programming languages.

The followings the major categories of fourth generation languages: query languages, report generators, graphics languages, application generators, application software packages, and microcomputer tools.

Details are as follows:

  1. Query Languages: are high-level languages for retrieving data stored in a databases or files. They are usually interactive, online, and capable of supporting requests for information that are not predefined. Query languages can search a database or file using simple or complex selection criteria to display information relating to multiple records.
  2. Report generation: are facilities for creating customized reports. They extract data from files or databases and create reports in many formats. Report generators generally provide more control over the way data are formatted, organized, and displayed than query languages. The more powerful report generators can manipulate data with complex calculations and logic before they are output.
  3. Graphics languages: graphic language retrieves data from files or database and displays them in graphic format. Users can ask for data and specify how they are to be charted. Some graphics software can perform arithmetic or logical operations on data as well.
  4. Application generators: contain pre-programmed modules that can generate entire applications, greatly speeding development. A user can specify what needs to be done, and the application generator will create the appropriate code for input, validation, update, processing, and reporting. Most fill function application generators consists of a comprehensive, integrated set of development tools: a database management system, data dictionary, query language, screen painter, graphics generator, reports generator, decision support/modeling tools, security facilities, and a high level programming language.
  5. Application software packages: a software package is a pre-written, pre-coded, commercially available set of programs that eliminates the need for individuals or organizations to write their own software programs for certain functions. There are software packages for system software, but the vast majority of package software is application software.

Application software packages consist of pre-written application software that is marketed commercially. These packages are available for major business applications on main frames, minicomputers, and microcomputers. They contain customization features so that they can be tailored somewhat to an organization unique requirement.

  1. Microcomputer tools: some of the most popular and productivity promoting fourth generation tools are the general purpose application packages that have been developed for microcomputers, especially word processing spreadsheet, data management, graphics, and integrated software packages.
    • Word processing software: stores text data electronically as a computer file rather than on paper. The word processing software allows the user to make changes in the document electronically in memory.

This eliminates the need or retypes an entire page in order to incorporate corrections. The software has formatting options to make changes in line spacing, margins, character size, and column width. Microsoft word and Word perfect are popular word processing packages.

  • Spreadsheets: electronic spread sheet software provides computerized version of traditional financial modeling tools such as the accountant’s columnar pad, pencil, and calculator. An electronic spread sheet is evident when one changes a value or values, because all other related values on the spreadsheet will be automatically recomputed.

Many spreadsheet packages include graphics functions that can present data in the form of line graphics, bar graphs, or pie charts. The most popular spreadsheet packages are Lotus 1-2-3, Quattro, and Microsoft Excel.

  • Data management software: while spreadsheet programs are powerful tools for manipulating quantitative data, data management system is more suitable for creating and manipulating lists and combining information from different files. Microcomputer database management packages have programming features and easy to learn menus that enable non-specialists to build small information systems.

Data management software typically has facilities for creating files and databases and for storing, modifying, and manipulating data for reports and queries. Popular database management software for the personal computer includes Microsoft Access, Paradox, etc.

  • Integrated software packages: combine the functions of the most important microcomputer software packages, such as word, processing, spreadsheets, graphics, and data management.

4.3.4 New Software Tools and Approaches

A growing backlog of software projects and the need for businesses to fashion systems that are flexible and quick to build have spawned a new approach to software development with “object-oriented” programming tools.

  1. Object-oriented programming: combines data and the specific procedures that operate on those data into one “object”. The object combines data and program code. Instead of passing data to procedures, program send a message for an object to perform a procedure that is already embedded into it (procedures are termed “methods” object oriented languages). The same message may be sent too many different objects, but each will implement that message differently.

For example, an object-oriented financial application might have customer objects sending debit and credit messages to Account objects. The account objects in turn might maintain cash-on-hand, accounts payable, and accounts receivable objects.

An object’s data are hidden from other parts of the program and can only be manipulated from inside the object. The method for manipulating the object’s data can be changed internally without affecting other parts of the program. Programmers can focus on what they want an object to do, and the object decides how to do it.

Object oriented programming is based on the concept of class and inheritance. Class is a feature of object oriented programming so that all objects belonging to a certain class have all of the features of that class.

Inheritance on the other hand is a feature of object oriented programming in which a specific class of objects receives the features of a more general class.

Program code is not written separately for every object but for classes, or general categories of similar objects. Objects belonging to a certain class have the features of that class. Classes of objects in turn can inherit all the structures and behaviors of a more general class and then add variables and behaviors unique to each object. New classes of objects are created by choosing an existing class instead of starting from scratch each time.

  1. Visual programming: Object oriented programming has spawned a new programming technology known as visual programming. With visual programming, programmers do not write code. Rather they use a mouse to select and move around programming objects, copying an object from a library into a specific location in a program, or drawing a line to connect two or more objects. The window on technology more fully describes drop and drag, one visual programming method.

Check Your Progress Exercise

  1. What is an operating system? Discuss.


  1. What are the major capabilities of an operating system?


  1. Compare the major microcomputer operating system.


  1. Explain the major types of software.


  1. What is graphical user interface? Explain.


4.4 Summary

Software is a detailed instruction that control the operation of a computer system. A software program is a series of statements or instructions to the computer. Basically, there are two types of software: system software and application software.

System software manages the computer resources and mediates between application software and computer hardware.

Application software is used by application programmers and some end users to develop systems and specific business applications. Applications software works through system software, which controls access to computer hardware.

System software coordinates the various parts of the computer system and mediates between the application software and computer hardware. The system software that manages and controls the activities of the computer is called the operating system. Other system software includes computer language translation program that converts programming languages into machine language and utility programs that perform common processing task.

The operating system acts as the chief manager of the information system, allocating, assigning, and scheduling system resources and monitoring the use of the computer.

Multiprogramming, Multitasking, Virtual storage, Time sharing, and Multiprocessing, enable systems resources to be used more efficiently so that the computer can attack many problems at the same time.

Microcomputer operating systems are starting to develop sophisticated capabilities such as multitasking and support for multiple users on networks. Leading microcomputer operating systems include Windows 95, 98, 2000, XP, Windows NT, OS/2, UNIX, System 7, and DOS.

There have been four generations of software development: (1) machine languages, (2) assembly language, (3) high level language, and (4) four generation language.

Fourth generation languages include query language, report generators, graphics languages, application generators, application software packages, and microcomputer tools.

The new concept of object oriented programming combines data and procedure into one “object”, which can act as an independent software building block. Each object can be used in many different systems without changing program code.

4.5 Answer to Check Your Progress Exercise

  1. Refer Section 4.2.1
  2. Refer Section 4.2.3
  3. Refer Section 4.2.2
  4. Refer Section 4.2 & 4.3
  5. Refer Section 4.2.4



5.0 Aims and Objectives

  • Introduction
  • File Organization Terms and Concepts
  • Accessing Records from Computer Files
  • Problems with The Traditional File Environment
  • Database Management System (DBMS)
    • Components of DBMS
    • Designing Database
    • Requirements of Database System
  • Summary
  • Answer to Check Your Progress Exercise

5.0 Aims and Objectives

After studying this unit, you will be able to explain

  • the meaning of database
  • what database management system is
  • the components of database system
  • the merits and demerits of DBMS
  • the requirements of DBMS

5.1 Introduction

An effective information system provides users with timely, accurate, and relevant information. This information is stored in computer files. When the files are properly arranged and maintained, users can easily access and retrieve the information they need.

Well-managed, carefully arranged files make it easy to obtain data for business decisions whereas poorly managed files lead to chaos in information processing, high costs, poor performance, and little, if any flexibility. Despite the use of excellent hard ware and software, many organizations have inefficient information system because of poor file management.

Database technology can cut through many of the problems created by traditional file organization. A more rigorous definition of a database is a collection of data organized to serve many applications efficiently by centralizing the data and minimizing redundant data. Rather than storing data in separate files for each application, data are stored physically to appear to users as being stored in only one location. A single data base services multiple applications.

5.2 File Organization Terms and Concept

A computer system organizes data in a hierarchy that starts with bits and bytes and progresses to fields, records, files, and database. A bit represents the smaller unit of data a computer can handle.

A group of bits, called a byte, represent a single character, which can be a letter, a number or another symbol. A grouping of characters into a word, a group of words, or a complete number (such as a person’s name or age), is called a field. A group of related fields, such as the student’s name, the course taken, the date and the grade make up a record. A group of records of the same time is called a file. A group of related files make up a database.

A record describes an entity. An entity is a person, place, thing, or event on which we maintain information. An order is a typical entity in a sales order file, which maintains information on a firm’s sales orders. Each characteristic or quality describing a particular entity is called an attribute. For example, order number, order date, order amount, item number, and item quantity would each be an attribute of the entity order.

Every record in a file should contain at least one field that uniquely identifies that record so that the record can be retrieved, updated or sorted. This identifier field is called a key field.

Figure 5.1: Hierarchy of Data

A computer system organizes data in a hierarchy that starts with the bit, which represents either a 0 or a 1. Bits can be grouped to form a byte to represent one character, number of symbol. Bytes can be grouped to form a field and related fields can be grouped to form a record.

Related records can be collected to form a file and related files can be organized into a database.

Figure 5.2 Entities and Attributes

The above record describes the entity called order and its attributes. The specific values for order and its attributes. The specific vales for order number, order date, item number, quantity, and amount for this particular order are the fields for this record. Order number is the key field because each order is assigned a unique identification number.

5.3 Accessing Records from Compute Files

Computer system store files on a secondary storage devices. Records can be arranged in several ways on storage media, and the arrangement determines the manner in which individual records can be accessed or retrieved.

One way to organize records is sequentially. In sequential file organization, data records must be retrieved in the same physical sequence in which they are stored. In contrast, direct or random file organization allows users to access records in any sequence they desire without regard to actual physical order on the storage media.

Sequential file organization is the only file organization method that can be used on magnetic tape. This file organization method is no longer popular, but some organization still use it for batch processing applications in which they access and process each record sequentially. A typical application using sequential files is payroll, where all employees in a firm must be paid one by one and issued a cheque. Direct or random file organization is utilized with magnetic disk technology (although records can be stored sequentially on disk if desired). Most computer applications today utilize some method of direct file organization.

Although records may be stored sequentially on direct access storage devices, individual records can be accessed directly using the Indexed Sequential Access Method (ISAM). This access method relies on an index of key fields to locate individual records. An index to a file is similar to the index of a book, as it lists the key field of each record and where that record is physically located in storage to expedite location of that record. Records are stored on disk in their key sequence. ISAM is employed in applications that require sequential processing of large numbers of records but that occasionally require direct access of individual records.

The direct file access method is used with direct file organization. This method employs a key field to locate the physical address of a record. However, the process is accomplishing using a mathematical formula called a transform algorithm to translate the key field directly into the record’s physical storage location on disk. The algorithm performs some mathematical computation on the record key, and the result of that calculation is the records physical address.

This access method is most appropriate for applications where individual’s records must be located directly and rapidly for immediate processing only. A few records in the file need to be retrieved at one time, and the required records are found in no particular sequence, i.e., on line hotel reservation system.

5.4 Problems with the Traditional File Environment

Most organizations began information processing on a small scale automating one application at a time. Systems tended to grow independently, and not according to some grand plan. Typically, each division of a multi-division company developed its own applications. Within each division, each functional area tended to develop systems in isolation from other functional areas. Accounting, finance, manufacturing, and marketing all developed their own systems and data files.

In the company as a whole, this process led to multiple master files created, maintained and operated by separate divisions or departments. The traditional file environment is a way of collecting and maintaining data in an organization that leads to each functional area or division creating and maintaining its own data files and programs.

Under this file environment, there is no central listing of data files, data elements or definition of data. The organization is collecting the same information on far too many documents. The resulting problems are data redundancy, program data dependence, inflexibility, poor data security, and inability to share data among applications.

i)       Data redundancy

It is the presence of duplicate data in multiple data files. Data redundancy occurs when different divisions, functional areas, and groups in an organization independently collect the same piece of information.

ii)    Program data dependence

It is the tight relationship between data stored in files and the specific programs required to update and maintain those files. Every computer program has to describe the location and nature of the data with which it works. These data declarations can be longer than the substantive part of the program. In a traditional file environment, any change in data requires a change in all of the programs that access the data.

iii)  Lack of flexibility

A traditional file system can deliver routine scheduled reports after extensive programming efforts, but it cannot deliver ad hoc reports or respond to unanticipated information requirements in a timely fashion. The information required by ad hoc requests is “somewhat in the system” but is too expensive to retrieve. Several programmers would have to work for weeks to put together the required data items in a new file.

iv)  Poor security

Because there is little control or management of data, access to and dissemination of information are virtually out of control. What limits on access exist tend to be the result of habit and tradition, as well as of the sheer difficulty of finding information.

v)    Lack of data sharing and availability

The lack of control over access to data in this confused environment does not make it easy for people to obtain information. Because pieces of information in different files and different parts of the organization cannot be related to one another, it is virtually impossible for information to be shared or accessed in a timely manner. The following figure illustrates the traditional file processing.

Figure 5.3 Traditional File Processing

5.5 Database Management System (DBMs)

A database management system (DBMS) is simply the software that permits an organization, to centralize data, manage them efficiently, and provide access to the stored data by application programs. Consider the following figure that illustrates the database concept.

Figure 5.4: Contemporary Database Environment

The DBMs acts as an interface between application programs and the physical data files. When the application program calls for data item such as gross pay, the DBMs finds this item in the database and presents it to the application program. Using traditional data files, the programmer would have to define the data and then tell the computer when they are. The following figure illustrates the elements of a database management system.

Figure5.5: Database Management System

A database management system has three components:

  • A data definition language
  • A data manipulation language
  • A data directory
  • Data definition language: the data definition language is the formal language used by programmers to structure of the database. The data definition language defines each data element as it appears in the database before that data element is translated into the forms required by the application programs.
  • Data manipulation language: most DBMs have a specialized language called a data manipulation language that is used in conjunction with some conventional third or fourth generation programming languages to manipulate the data in the database. This language contains commands that permit end users and programming specialists to extracts data from the database to satisfy information requests and develop applications. The most prominent data manipulation language today is SQL, or structured Query language.
  • Data dictionary: the third element of DBMs is a data dictionary. This is an automated or manual file that stores definitions of data elements and data characteristics such as usage, physical representation, ownership (who in the organization is responsible for maintaining the data), authorization, and security. Many data dictionaries can produce lists and reports of data utilization, groupings, program locations, and so on.

Advantages of Database Management System

The advantages of a DBMS are as follows:

  • Complexity of the organization’s information system environment can be reduced by central management of data, access, utilization, and security
  • Data redundancy and inconsistency can be reduced by eliminating all of the isolated files in which the same data elements are repeated
  • Data confusion can be eliminated by providing central control of data creation and definitions
  • Program data dependence can be reduced by separating the logical view of data from its physical arrangement
  • Program development and maintenance costs can be radically reduced
  • Flexibility of information systems can be greatly enhanced/by permitting rapid and inexpensive ad hoc queries of very large pools of information
  • Access and availability of information can be increased

5.5.2 Designing Database

There are alternative ways of organizing data and representing relationship among data in a database. Conventional DBMS uses one of three principal logical database models for keeping track of entities, attributes, and relationships. The three principal logical database models are hierarchical, network, and relational. Each logical model has certain processing advantages and certain business disadvantages.

i)       Hierarchical Data Model

The hierarchical data model presents data to users in a tree like structure. Within each record, data elements are organized into pieces of records called segments. To the user, each record looks like an organizations chart with one top level segment called the root. An upper segment is connected logically to a lower segment in a parent-child, but a child can have only one parent. Consider the following figure.

Figure 5.6 the Hierarchical Data Base

The above shows the hierarchical structure that might be used for a human resources database. The root segment is “employee” which contains basic employee information such as name, address, and identification number. Below it are three child segments: compensation (containing salary and promotion data), job assignment (containing data about job positions and departments), and benefits (containing data about beneficiaries and various benefits options). The compensation segments have two children below it: performance rating (containing data about employee’s job performance evaluations) and salary history (containing historical data about employee’s past salaries). Below the benefits segments are child segments for pension, life insurance, and health care, containing data about these various benefits plan.

Behind the logical view of data are a number of physical links and devices to tie the information together into a logical whole. In a hierarchical DBMS the data are physically linked to one another by a series of pointers that form chains of related data segments.

Pointers are data elements attached to the ends of record segments on the disk directing the system to related records.

i)       Network Data Model

The network data model is a variation of the hierarchical data model. Indeed data bases can be translated from hierarchical to network and vice versa in order to optimism processing speed and convenience.

Whereas, hierarchical structures, despite one to many relationships, network structures depict data logically as many to many relationships. In other words, parents have multiple “children” and a child can have more than one parent.

A typical many to many relationships in which network DBMS excels in performance is the student course relationship (See the following Figure)

Figure 5.7 Network Data Model

Network structures reduce redundancy and, in certain situations (where many to many relationships are involved), respond more quickly. However, there is a price for this reduction in redundancy and increased speed: the number of pointers in network structures rapidly increases, making maintenance and operation potentially more complicated.

i)       Related Data Model

The relational data model, the most recent of these three database models, overcomes some of the limitations of the other two models. The relational model represents all data in the database as simple two dimensional tables called relations. The tables appear similar to flat files, but the information is more than one file can be easily extracted and combined. Sometimes the tables are referred to as files. Consider the following figure.

Figure 5.8 Relational Data Model

Table (Relation)

The above figure shows a supplier table, a part table and an order table. In each table the rows are unique record and the columns are fields. Another term for a row or record in a relation is a tuple. Often a user needs information from a number of relations to produce a report. Here is the strength of the relational model: it can relate data in any one file or table to data in another file or table as long as both tables shares a common data element.

Advantages and Disadvantage of the Models

The principal advantage of the hierarchical and network database models is processing efficiency. For instance, a hierarchical model is appropriate for airline reservation transactions processing systems, which must handle millions of structured routine requests each day for reservation information.

Hierarchical and network structures have several disadvantages. All of the access paths, directories, and indices must be specified in advance. Once specified, they are not easily changed without a major programming effort. Therefore, these designs have low flexibility.

Both hierarchical and network systems are programming – intensive, time consuming, difficult to install, and difficult to remedy if design error occurs. They do not support ad hoc, English languages – like inquiries for information.

The strengths of relational DBMS are great flexibility in regard to ad hoc queries, power to combine information from difficult sources, simplicity of design and maintenance, and the ability to add new data and records without disturbing existing programs and applications.

The weakness of relational DBMS is their relatively low processing efficiency. These systems are somewhat slower because they typically require many accesses to the data stored on disk to carry out the select, join, and project commands. Selecting one part number from among millions, one record at a time, can take a long time. Of course, the database can be indicated and “turned” to speed up pre-specified queries. Relational systems do not have the large number of pointers carried by hierarchical systems.

5.5.3 Requirements of Database System

Much more is required for the development of database systems than simply selecting a logical database model. Indeed, this selection may be among the last decision. The database is an organizational discipline, a method, rather than a tool or technology. It requires organizational and conceptual change.

Without management support and understanding, database efforts fail. The critical elements in a database environment are (1) data administration, (2) data planning and modeling methodology, (3) database technology and management, and (4) users. The environment is depicted in the following figure.

Figure 5.8: Database Environment

1.     Data Administration

Database systems require that the organization recognize the strategic role of information and begin actively to manage and plan for information as a corporate resource. This means that the organization must develop a data administration function with the power to define information requirements for the entire company and with direct access to senior management.

Data administration is responsible for the specific policies and procedures through which data can be managed as an organizational resource. These responsibilities include developing information policy, planning for data, overseeing logical database design and data dictionary development, and monitoring the usage of data by information system specialists and end users groups.

An organization needs to formulate an information policy that specified its rules for sharing, disseminating, acquiring, standardizing, classifying, and inventorying information throughout the organization. Information policy lays out specific procedures and accountabilities, specifying which organizational units share information. While information can be distributed, and maintaining the information.

2.     Data Planning and Modeling Methodology

Because the organizational interests served by the DBMS are much broader than those in the traditional file environment, the organization requires enterprise-wide planning for data. Enterprise analysis, which addresses the information requirements of the entire organization (as opposed to the requirements of individual applications), is needed to develop databases. The purpose of enterprise analysis is to identify the key entities, and relationships that constitute the organization’s data.

3.     Database Technology and Management

Database requires new software and a new staff specially trained in DBMS techniques as well as new management structures. Most corporations develop a database design and management group within the corporate information system division that is responsible for the more technical and operational aspects of managing data. The functions it performs are called database administration. This group does the following:

  • Defines and organizes database structure and content
  • Develops security procedures to safeguard the database
  • Develop database documentation
  • Maintains the database management software: in close cooperation with users, the design group establishes the physical database, the logical relations among elements, and the access rules and procedures.
  • Users: a database serves a wider community of users than traditional systems. Relational systems with fourth-generation query languages permit employees who are not computer specialist to access large databases. In addition, users include trained computer specialists. In order to optimize access for non-specialists, more resources must be devoted to training end users. Professional systems workers must be retained in the DBMS language, DBMS application development procedures, and new software practices.

Check Your Progress Exercise

  1. Discuss in detail the file access methods?


  1. Define database and database management systems.


  1. List some of the benefits of DBMS.


  1. Describe the three principal database models and their merits and demerits.


  1. What are the four key elements of a database environment? Describe each briefly.


5.6 Summary

In traditional file environment, data records are organized using either a sequential file organization or a direct or random file organization. Records in sequential file can be accessed sequentially or they can be accessed directly if the sequential file is on disk and uses an indexed sequential access method. Records on a file with direct file organization can be accessed directly without an index.

Database management systems (DBMS) are the software that permits centralization of data management. A DBMS includes a data definition language, a data manipulation language, and a data dictionary capability. The most important feature of the DBMS is its ability to separate the logical and physical view of data.

The DBMS retrieves information so that the user does not have to be concerned with its physical location. This feature separates programs from data and from the management of data.

There are three principal logical database models: hierarchical, network, and relational. Each has unique advantages and disadvantages. Hierarchical systems, which support one to many relationships, are low in flexibility but high in processing speed and efficiency.

Network systems support many to many relationships. Relational systems are relatively slow but are very flexible for supporting ad hoc requests for information and for combining information from different sources.

Development of a database environment requires much more than selection of technology. It requires a change in the corporation’s attitude toward information.

The organization must develop a data administration function and a data planning methodology. The database environment has developed more slowly that was originally anticipated. There is political resistance in organizations to many key database concepts, especially to sharing of information that has been controlled exclusively by one organizational group.

There is difficult cost/benefit questions database management. Often, to avoid raising difficult questions, database use begins and ends as a small effort isolated in the information systems department.

5.7 Answer to Check Your Progress Exercise

  1. Refer Section 5.3
  2. Refer Section 5.5
  3. Refer Section 5.5
  4. Refer Section 5.5.2
  5. Refer Section 5.5.3

UNIT 6: Telecommunication


            6.0 Aims and Objectives

            6.1 Introduction

            6.2 Components and Functions of a Telecommunication

            6.3. Types of Telecommunications Network

            6.4 Use of Telecommunications for Competitive Advantage

            6.5 Summary

            6.6 Answer to Check Your Progress Exercise

6.0 Aims and Objectives

After studying this unit, you will be able to explain,

  • To describe the basic components of a telecommunication
  • To describe the three basic network topologies
  • The functions of telecommunication
  • The types of communication channel, e.t.c.

6.1 Introduction

Telecommunication can be defined as communication of information by electronic means, usually over some distance.

We are currently in the middle of a telecommunication revolution that has two components: rapid changes in the technology of communications and equally important changes in the ownership, control, and marketing of telecommunications services. Today managers need to understand the capabilities, costs, and benefits of alternative communications technologies and how to maximize their benefits for their organizations.

Change in the telecommunication industry was accompanied by changes in telecommunication technology. Previously, telecommunications meant voice transmission over telephone lines. Today, much telecommunications transmission is digital data transmission, using computers to transmit data from one location to another. Online information system and remote access to information would be impossible without telecommunications.

Deregulation and the marriage of computers and communications has also made it possible for the telephone companies to expand from traditional voice communications into new information services, such as providing transmission of news reports, stock reports, television programs, and movies.

6.2 Components and functions of a telecommunications system

A telecommunications system is a collection of compatible hardware and software arranged to communicate information from one location to another. Figure 6.1: illustrates the components of a typical telecommunications system. Telecommunications systems can transmit text, graphic images, voice, or video information. This section describes the major components of telecommunications systems. Subsequent sections describe how the components can be arranged into various types of network.

A.   Components of a Telecommunications System

The essential components of a telecommunications system are these:

  1. Computers to process information.
  2. Terminals or any input/output devices that send or receive data.
  3. Communications channels, the links by which data or voice are transmitted between sending and receiving devices in a network. Communications channels use various communications media, such as telephone lines, fiber optic cables, coaxial cables, and wireless transmission.
  4. Communications processors, such as modems, multiplexer, controllers, and front-end processors, which provide support functions for data transmission and reception.
  5. Communications software that controls input and output activities and manages other functions of the communications network.

Figure 6.1: Components of a telecommunication system

A.   Functions of a Telecommunications System

In order to send and receive information from one place to another, a telecommunications system must perform a number of separate functions. These functions are largely invisible to the people using the system. As outlined in table 6.1: a telecommunications system transmits information, establishes the interface between the sender and the receiver, routes messages along the most efficient paths, performs elementary processing of the information to ensure that the right message gets to the right receiver, performs editorial tasks on the data (such as checking for errors and rearranging the format), and converts messages from one format to another. Lastly, the telecommunications system controls the flow of information. Many of these tasks are accomplished by computer.


A telecommunications network typically contains diverse hardware and software components that need to work together to transmit information. Different components in a network can communicate by adhering to a common set of rules that enable them to “talk” to each other. This set of rules and procedures governing transmission between two points in a network is called a protocol. Each device in a network must be able to interpret the other device’s protocol.

The principal functions of protocols in a telecommunications network are to identify each device in the communication path, to secure the attention of the other device, to verify correct receipt of the transmitted message, to verify that a message requires retransmission because it cannot be correctly interpreted, and to perform recovery when errors occur. Although business, government, and the computer industry recognize the need for common communications standards, the industry has yet to put a universal standard into effect.

Table 6.1: Functions of Telecommunications

Types of Signals: Analog and Digital

Information travels through a telecommunications system in the form of electromagnetic signals. Signals are represented in two ways: there are analog and digital signals. An analog signal is represented by a continuous waveform that passes through a communications medium. Analog signals are used to handle voice communications and to reflect variations in pitch.

A digital signal is a discrete rather than a continuous waveform. It transmits data coded into two discrete states: 1-bits and 0-bits, which are represented on-off electrical pulses. Most computers communicate with digital signals, as do many local telephone companies and some larger networks. But if a telecommunications system, such as traditional telephone network, is set up to process analog signals – the receivers, transmitters, amplifiers, and so forth – a digital signal cannot be processed without some alternations. All digital signals must be translated into analog signals before they can be transmitted in an analog system. The device that performs this translation is called a modem. (Modem is an abbreviation for MOdulation/DEModulation.) A modem translates the digital signals of a computer into analog form for transmission over ordinary telephone lines, or it translates analog signals back into digital form for reception by a computer (See figure below).

Figure6.2 Functions of a Modem

A.   Types of Communications Channel

Communications channels are the means by which data are transmitted from one device in a network to another. A channel can utilize different kinds of telecommunications transmission media: twisted wire, coaxial cable, fiber optics, terrestrial microwave, satellite, and wireless transmission. Each has certain advantages and limitations. High speed transmission media are more expensive in general, but they can handle higher volumes (which reduces the cost per bit). For instance, the cost per bit of data can be lower via satellite link than via leased telephone line if a firm uses that satellite link 100 percent of the time. There is also a wide range of speeds possible for any given medium depending on the software and hardware configuration.

1)    Twisted Wire

Twisted wire consists of strands of copper wire twisted in pairs and is the oldest transmission medium. Most of the telephone system in a building relies on twisted wires installed for analog communication. Most buildings have additional cables installed for future expansion, and so there are usually a number of twisted-pair cables unused in every office of every building. These unused cables can be used for digital communications. Although it is low in cost and is already in place, twisted wire is relatively slow for transmitting data, and high-speed transmission causes interference called cross talk. On the other hand, new software and hardware have raised the capacity of existing twisted-wire cables up to 10 megabits per second, which is often adequate for connecting microcomputers and other office devices.

2)    Coaxial Cable

Coaxial cable, like that used for cable television, consists of thickly insulated copper wire, which can transmit a larger volume of data than twisted wire can. It is often used in place of twisted wire for important links in a telecommunications network because it is a faster, more interference-free transmission medium, with speeds of up to 200 megabits per second. However, coaxial cable is thick, is hare to wire in many buildings, and cannot support analog phone conversations. It must be moved when computers and other devices are moved.

3)    Fiber Optics

Fiber optic cable consists of thousands of strands of clear glass fiber, the thickness of a human hair, which are bound into cables. Data are transformed into pulses of light, which are sent through the fiber optic cable by a laser device at a rate of 500 kilobits to several billion bits per second. On the one hand, fiber optic cable is considerably faster, lighter, and more durable than wire media and is well suited to systems requiring transfers of large volumes of data. On the other hand, fiber optic is more difficult to work with, more expensive, and harder to install. It is best used as the backbone of a network and not for connecting isolated devices to a backbone. In most networks, fiber optic cable is used as the high speed trunk line, while twisted wire and coaxial cable are used to connect the trunk line to individual devices.

4)    Wireless Transmission

Wireless transmission that sends signals through air or space without any physical tether has emerged as an important alternative to tethered transmission channels such as twisted wire, coaxial cable, and fiber optics. Today, common uses of wireless data transmission include pagers, cellular telephones, microwave transmissions, communication satellites, mobile data networks, personal communications services, personal digital assistants, and even television remote controls.

The wireless transmission medium is the electromagnetic spectrum. Some types of wireless transmission, such as microwave or infrared, by nature occupy specific spectrum frequency ranges (measured in megahertz). Other types of wireless transmissions are actually functional uses, such as cellular telephones and paging devices that have been assigned a specific range of frequencies by national regulatory agencies and international agreements. Each frequency range has its own strengths and limitations, and these have helped determine the specific function or data communications niche assigned to it.

5)     Microwave systems,

Both terrestrial and celestial, transmit high frequency radio signals through the atmosphere and are widely used for high volume, long distance, point to point communication. Because microwave signals follow a straight line and do not bend with the curvature of the earth, long distance terrestrial transmission systems require that transmissions be positioned 25 to 30 miles apart, adding to the expense of microwave.

This problem can be solved by bouncing microwave signals off satellites, enabling them to serve as relay stations for microwave signals transmitted from terrestrial stations. Communication satellites are cost effective for transmitting large quantities of data over long distances. Satellites are typically used for communications in large, geographically dispersed organizations that would be difficult to tie together through cabling media or terrestrial microwave.

Conventional communication satellites move in stationary orbits approximately 22,000 miles above the earth. A newer satellite medium, the low orbit satellite, is beginning to be deployed. These satellites travel much closer to the earth and so are able to pick up signals from weak transmitters. They also consume less power and cost less to launch than conventional satellites.

Other wireless transmission technologies have recently been developed and are being used in situations requiring mobile computing power. Paging systems have been in common use for several decades, originally just beeping when the user receives a message and requiring the user to telephone an office to learn what the message is. By the mid 1980s, however, paging devices have been able to receive short alphanumeric messages that the user reads on the pager’s screen. Paging is useful for communicating with mobile workers such as repair crews; one way paging can also provide an inexpensive way of communicating with workers in offices.

Cellular telephones (sometimes called mobile telephones) work by using radio waves to communicate with radio antennas (towers) placed within adjacent geographic areas called cells. A telephone message is transmitted to the local cell by the cellular telephone and then is handed off from antenna to antenna – cell to cell – until it reaches the cell of its destination, where it is transmitted to the receiving telephone. As a cellular signal travels from one cell into another, a computer that monitors signals from the cells switches the conversation to a radio channel assigned to the next cell. The radio antenna cells normally cover eight-mile hexagonal cells, although their radius is smaller in densely populated localities. While the cellular telephone infrastructure has primarily been used for voice transmission, recent developments have made it capable of two-way digital data transmission.

Wireless network explicitly designed for two way transmission of data files are called mobile data networks. These radio based networks transmit data to and from hand held computers. Another type of mobile data network is based upon a series of radio towers constructed specifically to transmit text and data. Ram Mobile Data (jointly owned by Ram Broadcasting and Bell South) and Ardis (jointly owned by IBM and Motorola) are two publicly available networks that use such media for national two-way data transmission.

One new wireless cellular technology that should begin to be available for both voice and data in 1996 is called personal communication services (PCS). PCS uses lower power, higher frequency radio waves than doe’s cellular technology. Because of the lower power, PCS cells are much smaller and so must be more numerous and closer together. The higher frequency signals enable PCS devices to be used in many places where cellular telephones are not effective, such as in tunnels and inside office buildings. Moreover, because PCS telephones need less power, they can be much smaller (shirt pocket size) and less expensive than cellular telephones.

Personal digital assistants (PDA) are small, pen-based, hand-held computer capable of entirely digital communications transmission. They have build in wireless telecommunications capabilities as well as work organization software. A well-known example is the one pound Apple Newton Message Pad. It can be equipped with a special card that allows it to function as a pager, and when hooked to a cigarette package sized modem, it will transmit E-mail, faxes, documents for printing, and data to other computers. The Newton also includes an electronic scheduler, calendar and notepad software, and is able to accept handwriting input entered through its special stylus.

B.     Characteristics of Communications Channel

The characteristics of the communications channel help determine the efficiency and capabilities of a telecommunications system. These characteristics include the speed of transmission, the direction in which signals may travel, and the mode of transmission.

1.     Transmission Speed

The total amount of information that can be transmitted through any telecommunications channel is measured in bits per second (BPS). Sometimes this is referred to as the baud rate. A baud is a binary event representing a signal change from positive to negative or vice versa. The baud rate is not always the same as the bit rate. At higher speeds, a single signal change can transmit more than one bit at a time so the bit rate will generally surpass the baud rate.

Since one signal change, or cycle, is required to transmit one or several bits per second, the transmission capacity of each type of telecommunications medium is a function of its frequency, the number of cycles per second that can be sent through that medium measured in hertz. The range of frequencies that can be accommodated on a particular telecommunications channel is called its bandwidth. The bandwidth is the difference between the highest and lowest frequencies that can be accommodated on a single channel.

Table 6.2 compares the transmission speed and relative costs of the major types of transmission media

Table 6.2   : Typical Speeds and Cost of Telecommunications Transmission Media

Medium Speed Cost
Twisted wire



Coaxial cable

Fiber optic cable

300 BPS – 10 MBPS

236 KBPS – 100MBPS

256 KBPS – 100 MBPS

56 KBPS – 200 MBPS

500 KBPS – 10 GBPS






BPS = bits per second                          KBPS = Kilobits per second

MBPS = megabits per second               GBPS = gigabits per second

1.      Transmission Modes

Three are several conventions for transmitting signals; these methods are necessary for devices to communicate when a character begins or ends. Asynchronous transmission (often referred to as start-stop transmission) transmits one character at a time over a line, each character framed by control bits – a start bit, one or two stop bits, and a parity bit. Asynchronous transmission is used for transmitting large volumes of data at high speed transmission.

Synchronous transmission transmits groups of characters simultaneous, with the beginning and ending of a block of characters determined by the timing circuitry of the sending and receiving devices. Synchronous transmission is used for transmitting large volumes of data at high speeds.

2.      Transmission Direction

Transmission must also consider the direction of data flow over a telecommunications network. In simplex transmission, data can travel only in one direction at all times. In half duplex transmission, data can flow two ways but can travel in only one direction at a time. In full duplex transmission, data can be sent in both directions simultaneously.

3.      Communications Processors

Communications processors, such as front end processors, concentrators, controllers, multiplexers, and modems, support data transmission and reception in a telecommunications network.

The front-end processor is a small computer (often a programmable minicomputer) dedicated to communications management and is attached to the main, or host, computer in a computer system. The front-end processor performs special processing related to communications such as error control, formatting, editing, controlling, routing, and speed and signal conversion. It takes some of the load off the host computer. The front end processor is largely responsible for collecting and processing input and output data to and from terminals and grouping characters into complete messages for submission on the CPU of the host computer.

A concentrator is a programmable telecommunications computer that collects and temporarily stores messages from terminals until enough messages are ready to be sent economically. The concentrator then “bursts” signals to the host computer.

A controller, which is often a specialized minicomputer, supervises communications traffic between the CPU and peripheral devices such as terminals and printers. The controller manages messages from these devices and communicates them to the CPU. It also routes output from the CPU to the appropriate peripheral device.

A multiplexer is a device that enables a single communications channel to carry data transmissions from multiple sources simultaneously. The multiplexer divides the communications channel so that it can be shared by multiple transmission devices. The multiplexer may divide a high-speed channel into multiple channels of slower speed or may assign each transmission source a very small slice of time for using the high-speed channel.

6.3 Types of Telecommunications Networks

A number of different ways exist to organize telecommunications components to form a network and hence provide multiple ways of classifying networks. Networks can be classified by their shape or topology. Networks can also be classified by their geographic scope and the type of services provided. Wide area networks, for example, encompass a relatively wide geographic area, from several miles to thousands of miles, whereas local networks link local resources such as computers and terminals in the same department or building of a firm. This section will describe the various ways of looking at networks.

A.                     Network Topologies

1.     Star Network

The star network (see figure6.3) consists of a central host computer connected to a number of smaller computers or terminals. This topology is useful for applications where some processing must be centralized and some can be performed locally. One problem with the star network is its vulnerability. All communication between points in the network must pass through the central computer. Because the central computer is the traffic controller for the other computers and terminals in the network, communication in the network will come to a standstill if the host computer stops functioning.

Figure 6.3 Star Net Work Topology

All computers will be attached to a central controller called a hub forming a star like structure. The hub (sometimes called the concentrator) is a central device and it is a connector.

Usually, the hub in its end will be attached to a server and all the computers that are connected with the hub are clients. So any request from the clients will pass through the hub and reaches to the server. Generally, the hub will act as a traffic controlling the requests from the clients this topology is advantageous if you specially consider the network failure and collision of data. If there is any interruption between one of the clients and the hub, then the other clients will normally work. Second, since there is a dedicated controller, the hub, collision is much reduced. The disadvantage of this topology is we need to use more cable and if the hub fails, then the whole network will fail. So the entire network is dependent on the hub.

1.     The Bus Network

The bus network links (see figure 6.4) links a number of computers by a single circuit made of twisted wire, coaxial cable, or fiber optic cable. All of the signals are broadcast in both directions to the entire network, with special software to identify which components receive each message (there is not central host computer to control the network). If one of the computers in the network fails, none of the other components in the network is affected. This topology is commonly used for local are networks (LANs), discussed in the following section.

Figure 6.4 the Bus Net Work Topology

1.     The Ring Network

Like the bus network, the ring network (see figure6.5) does not rely on a central host computer and will not necessarily break down if one of the component computers malfunctions. Each computer in the network can communicate directly with any other computer, and each processes its own applications independently. However, in ring topology, the connecting wire, cable, or optical fiber forms a closed loop. Data are passed along the ring from one computer to another and always flow in one direction.

The token ring network is a variant of the ring network. In the token ring network, all of the devices on the network communicate using a signal or “token.” The token is a predefined packer of data, which includes data indicating the sender, receiver, and whether the packer is in use. The tokens may contain a message or be empty.