An information system is a collection of people, procedures, software, hardware, and data (as we discussed in Chapter 1). They all work together to provide information essential to running an organization. This is information that will successfully produce a product or service and, for profit-oriented enterprises, derive a profit.

Why are computers used in organizations? No doubt you can easily state one reason: to keep records of events. However, another reason might be less obvious: to help make decisions. For example, point-of-sale terminals record sales as well as which salesperson made each sale. This information can be used for decision making. For instance, it can help the sales manager decide which salespeople will get yearend bonuses for doing exceptional work.

The Internet, communication links, and databases connect you with information resources as well as information systems far beyond the surface of your desk. The microcomputer offers you access to a greater quantity of information than was possible a few years ago. In addition, you also have access to better-quality information. As we show in this chapter, when you tap into a computer-based information system, you not only get information—you also get help in making decisions.

Competent end users need to understand how the information flows as it moves through an organization’s different functional areas and management levels. They need to be aware of the different types of computer-based information systems, including transaction processing systems, management information systems, decision support systems, and executive support systems. They also need to understand the role and importance of databases to support each level or type of information system.