Exam Question One - AIS

Question 1

Basic Concepts of an AIS

Answer 1

System - a set of two or more interrelated components interacting to achieve a goal
Data - facts that are collected, recorded, stored & processed by an information system
Information - processed & organised to provide meaning to a user & help make a decision.

Question 2

What is an AIS

Answer 2

A system that collects, records, stores and processes data to produce and report information for decision making by a variety of users

Question 3

Three Components of AIS

Answer 3

1. Collect and store data about organisational activities, resources and personnel
2. Transform data into information enabling management to plan, execute, control and evaluate activities, resources and personnel.
3. Provide adequate controls to safeguard organisation’s assets and data to ensure that the assets and data are available when needed and data is accurate.

Question 4

Characteristics of Useful Information

Answer 4

1. Relevant - to users in making predictions
2. Timely - available before it loses capacity to influence decisions
3. Understandable - enables users to perceive its significance
4. Verifiable - measurement has been used without error or bias
5. Reliable - quality information, faithful- free from bias
6. Complete - necessary material information reported
7. Accessible - where needed & in useful format

Question 5

How an AIS adds value to an organisation

Answer 5

1. Improve quality & reduce cost of products/services
2. Improve efficiency - timely information, efficient operations
3. Sharing knowledge & expertise - improve operations
4. Improve efficiency & effectiveness of supply chain
5. Improve internal control structure
6. Improve decision making

Question 6

Why do we need to study an AIS

Answer 6

To effectively measure how cost-effectively they perform, to asses their reliability and that of the information produced, or to lead the redesign and implementation of new and better systems.

Question 7

Support Activities of a Value Chain

Answer 7

1. Firm Infrastructure
2. Technology
3. Human Resources
4. Purchasing

Question 8

Primary Activities of a Value Chain

Answer 8

1. Inbound Logistics - purchasing & storing materials
2. Operations - manufacturing
3. Outbound Logistics - distribution
4. Sales & Marketing - advertising & selling
5. Service - maintenance