Unit 1.3
Types of Computer-Based Information Systems (CBIS)
IT 233: Business Information Systems
Learning Objectives
By the end of this chapter, you will be able to:
- ✅ Define a Computer-Based Information System (CBIS).
- ✅ Describe the different types of information systems used at various organizational levels.
- ✅ Differentiate between Transaction Processing Systems (TPS) and Management Information Systems (MIS).
- ✅ Explain the purpose of Decision Support Systems (DSS) and Executive Information Systems (EIS).
What is a CBIS?
A Computer-Based Information System (CBIS) is an information system that uses computer hardware and software to collect, process, store, and distribute information.
Think of these systems as a pyramid, serving different levels of an organization.
Build the CBIS Pyramid
Click a system type chip, then click the correct pyramid level to place it.
Level 1: Transaction Processing Systems (TPS) ⚡
Level: Operational
Purpose: Process and record high-volume, routine, day-to-day business transactions.
Users: Frontline staff (cashiers, clerks, tellers)
Characteristics:
- Focus on speed & accuracy
- Highly structured
- Mission-critical
Example: Point-of-Sale (POS)
At a Bhat-Bhateni supermarket in Kathmandu, the POS system scans items, processes payments (via cash, card, or eSewa), and updates inventory in real-time for every single transaction.
Level 2: Management Information Systems (MIS) 📊
Level: Tactical / Managerial
Purpose: Summarize data from the TPS to provide routine reports for monitoring and control.
Users: Mid-level managers
Characteristics:
- Focus on past and present data
- Provides routine summary reports
- Less interactive than a DSS
Example: Weekly Sales Report
A sales manager for a beverage company receives a weekly report summarizing total sales by product, region (e.g., Province 1 vs. Bagmati), and salesperson. This helps them track performance against targets.
TPS vs. MIS: A Quick Comparison
Transaction Processing Systems (TPS)
- Input: Raw transaction data
- Processing: Sorting, listing, merging
- Focus: Capturing data
- Level: Operational
- Question: "What are the daily sales?"
Management Information Systems (MIS)
- Input: Summarized data from TPS
- Processing: Summary, comparison
- Focus: Transforming data into information
- Level: Managerial
- Question: "How do this month's sales compare to last month's?"
TPS vs. MIS — Quick-Fire Quiz
Three questions. Click your answer to get instant feedback.
🎬 TPS vs MIS in a Library
Level 3: Decision Support Systems (DSS) 🔍
Level: Tactical / Managerial
Purpose: To support complex, non-routine decision-making by allowing users to interact with data and models.
Users: Managers, business analysts
Key Feature: "What-If" Analysis
DSS allows managers to change variables to see the potential outcomes of different decisions.
Example: Financial Modeling
A financial planner at a Nepali commercial bank uses a DSS to model the impact of a 0.5% increase in home loan interest rates on the bank's projected annual revenue.
🧮 Worked Example: A DSS "What-If"
A bank has Rs 10 billion in home loans at 10% interest. Should it raise the rate to 10.5%? (Example data)
| Scenario | Loans kept | Rate | Yearly interest |
|---|---|---|---|
| Today | Rs 10 bn | 10% | Rs 1,000 million |
| Raise rate, nobody leaves | Rs 10 bn | 10.5% | Rs 1,050 million |
| Raise rate, 5% of borrowers move to another bank | Rs 9.5 bn | 10.5% | Rs 997.5 million |
The DSS shows that if about 5% of borrowers leave (break-even is about 4.8%), the "profitable" rise loses money. That is what-if analysis.
Know Your Systems — Flip the Cards
Click each card to reveal the key facts about that information system type.
Transaction Processing
- Level: Operational
- Users: Frontline staff
- High-volume routine tasks
- Focus: Speed & accuracy
- Q: "What sold today?"
Management Information
- Level: Managerial
- Users: Mid-level managers
- Periodic summary reports
- Input: Data from TPS
- Q: "How did we do?"
Decision Support
- Level: Managerial
- Users: Managers, analysts
- What-if analysis
- Interactive & flexible
- Q: "What if we change X?"
Executive Information
- Level: Strategic
- Users: CEO, CFO, COO
- KPI dashboards & graphs
- Drilldown capability
- Q: "Is the org on track?"
Level 4: Executive Information Systems (EIS) 🎯
Level: Strategic
Purpose: To provide a high-level, graphical overview of organizational performance for strategic planning.
Users: Senior executives (CEO, CFO, COO)
Key Feature: Digital Dashboards
EIS presents complex information in easy-to-read charts and graphs, focusing on Key Performance Indicators (KPIs).
Example: CEO Dashboard
The CEO of a large hydropower company in Nepal views a dashboard showing real-time electricity generation, overall profitability, stock price, and competitor performance data.
🎬 What an EIS Is For
CBIS Scenario Classifier
Read each scenario. Click the correct CBIS type. Work through all 6 to see your score.
Other Important System Types
Enterprise Resource Planning (ERP)
Large-scale systems that integrate all major business functions (finance, HR, supply chain) into a single, unified system. They are the backbone for many TPS and MIS.
Example: A manufacturing company using a single ERP to manage orders, inventory, and accounting.
Expert Systems (ES)
A type of AI that captures human expertise to provide advice or solve problems in a specific domain.
Example: A medical diagnosis tool that suggests possible illnesses based on a patient's symptoms.
🩺 Real Case: MYCIN, an Early Expert System
- Built at Stanford University in the 1970s to help doctors choose antibiotics for serious blood infections.
- It held about 600 "if–then" rules taken from infectious-disease experts, and explained its reasoning.
- In a 1979 test, outside experts rated its treatment choices at least as good as those of Stanford's own specialists.
- It was never used on real patients, mainly over questions of trust, legal responsibility and how it would fit into hospital routines.
The technology is often not the hard part. The People and Processes components decide whether a system is used.
🎬 Why Expert Systems Explain
CBIS in Action: A Nepali University
TPS in Action
The online student registration system processes course enrollments and tuition payments each semester.
DSS in Action
An academic planner uses a system to model different class schedules to optimize classroom usage and avoid student conflicts.
MIS in Action
The department head receives a monthly report showing student enrollment numbers for each course compared to the previous year.
EIS in Action
The University's Vice-Chancellor views a dashboard showing overall student enrollment trends, graduation rates, and financial health.
Nepal Business Challenge
Five real-world Nepal scenarios. Identify which CBIS type is being described. One scenario at a time.
💊 Worked Example: A Retail Pharmacy Chain
A chain of 12 pharmacies across Kathmandu Valley (example):
- TPS: records every sale with the medicine's batch number and expiry date.
- MIS: a weekly report lists slow-selling items and stock that expires within 90 days, by branch.
- DSS: the operations manager models "What if we open one branch 24 hours near the teaching hospital?"
- EIS: the owner's dashboard shows revenue per branch against target, and wastage from expired stock.
This is the model answer shape for Long Answer Q1: one business, one example per level.
A Pharmacy Inside a Supermarket
🧭 Matching Systems to Types of Decision
| Decision type | What it's like | Typical system |
|---|---|---|
| Structured | Routine, with clear rules and one right answer | TPS, MIS |
| Semi-structured | Some rules, but judgement is needed | DSS |
| Unstructured | New, one-off, no clear rule or answer | EIS (plus experience) |
As you move up the pyramid, decisions become less structured and less frequent, but bigger.
🧪 Activity: Structured, Semi-Structured or Unstructured?
1. Reorder printer paper when stock falls below 50 boxes. → Structured
2. Decide the price of a new product, using cost and competitor data. → Semi-structured
3. Should our company enter the Indian market in the next five years? → Unstructured
4. Calculate overtime pay for 40 factory workers. → Structured
5. Choose which of three districts gets the next branch. → Semi-structured
Chapter Summary & Key Takeaways
- CBIS are categorized based on the organizational level they support (Operational, Tactical, Strategic).
- ⚡ TPS captures the raw data from daily operations.
- 📊 MIS summarizes that data into routine reports for managers.
- 🔍 DSS provides interactive tools for complex, "what-if" analysis.
- 🎯 EIS offers a high-level, graphical view of the business for senior executives.
- These systems work together, with the output of one often becoming the input for the next.
💬 Discuss in Pairs (3 minutes)
1. A small tea shop has only a TPS (a sales app). Does it need an MIS, a DSS or an EIS? Why or why not?
2. Can a DSS ever make a decision for a manager? Where should the line be?
3. If an expert system gives wrong medical advice, who is responsible?
Exam Practice 📝
Short answer
- What is a computer-based information system (CBIS)?
- Distinguish between a TPS and an MIS.
- What is a decision support system (DSS)? Give an example.
Exam Practice 📝 (continued)
Long answer
- Explain the types of computer-based information systems in the information systems pyramid, with an example of each from a retail business.
- Compare TPS, MIS, DSS, and EIS in terms of the level of management served, the type of decision supported, and the data used.
Revise the answers in the full note.
Image & Video Credits
Images
- ERP modules diagram: made for this course
- CVS Pharmacy at Target, Dadeland, Miami (2022): Phillip Pessar, CC BY 2.0, via Wikimedia Commons
Videos (YouTube)
- Our Kaleidoscope Journey, "Types of Information Systems (TPS, MIS, and DSS)" (272–317 s)
- The Learning Studio, "Executive Information Systems | Dashboards, KPIs and Strategy" (10–71 s)
- Miss Paws and Friends, "What are Rule-Based Systems? | AI/ML Module 1.5" (32–108 s)
Thank You
Any questions?
Next Topic: Unit 1.4: The Impact of Information Technology on Organizations | IT 233