Management of Information Systems in Business


Information System management is the innovative sphere of the business activity, and it has its own weak and powerful points that define the success of the IS and IT implementation. Originally, this type of management often requires additional resources, and may not be regarded as beneficial. However, it helps to increase the benefits of the other departments, by improving the operability, and accelerating the data exchange processes.

Impacts of Informational Systems

Positive impacts:

  • Information system simplify the data exchange among companies
  • Information systems offer remote control for the departments of a company
  • Information Systems provide the accelerated data procedure

Negative impacts:

  • Information systems require additional financial and human resources
  • Poorly working IS violates the work of the entire company
  • Using of the Information Systems requires the increased qualification of the employers

It is necessary to emphasize that the application of the IS technologies in business sphere is aimed to increase the operability of the management teams, as initially, IS are aimed to increase the data exchange process. On the other hand, the system should be properly tuned and arranged, otherwise it may worsen the work of any department. Thus, the arrangement of the information systems requires additional human and financial resources, as the IS equipment should be constantly observed.

Impacts of the Information Systems, both positive and negative are originated from the qualification level of the IT department, and this level generally defines the extent, to which the Information System affects the business process.

Five Layers of the TCP/IP model

TCP/IP is the computer network protocol, required for the correct data transfer. Originally, it requires five layers, in order to be complete, and the termination, or improper work of any of the layers causes the breakdown of the data transmission. The basic layer is the hardware of the computer (physical layer). It provides the computer’s ability to be connected to the computer net, and transmit data through the net.

The next layer is the data link. It is used to move the data packets, which are the basis of data transmission. Datalink is used to connect the computers of the similar host, and create the stable data connection that uses the packet data transmission principle.

Internet layer is the next level of the TCP/IP protocol model. This layer is used to solve the problems associated with getting and transmitting the data packets across the single global network. This layer provides the stable connection of the two IPs, by using different routs for every packet. Thus, independently on the breakdowns of some ways, the data packets will be delivered anyway, as the very principle of internet is the independence on the net structure.

Transport layer. It includes end-to-end message transfer opportunities independent of the network, along with error control, fragmentation and flow control. Transportation may be regarded literally as transport, which delivers messages and files to the end-users. Thus, it is the system of reaching the set up destination, independently of the net structure.

Application layer. The Application Layer denotes the higher-level protocols applied by most software for network communication. Instances of application layer protocols entail the File Transfer Protocol (FTP) and the Simple Mail Transfer Protocol (SMTP). This is the layer, aimed at instant communication, and transmission of texts and files.

Limitations of the Financial Models

The financial management in IT and the investment of the Information System development can not be regarded as the beneficial investment. Originally, the IT sphere is not beneficial, however, it helps to benefit, if properly applied to the business sphere. The main limitation of the financial models is the inability to get the instant income, as the implementation of the Information Systems into the business sphere requires time, and, surely, the additional resources. Moreover, the employers should get particular qualification as the PC users before the IS implementation starts to be beneficial. IS users may be another limitation, as people will be reluctant to change the working customs and principles.

The application of these models is not indicated for investments because of the discussed reasons, and the limitations that are included into the financial models. This type of investment entails numerous factors that list this model as not beneficial, however, most companies have already invested and implemented the Information Systems into their businesses, and, surely, benefited from doing it. The fact is that, reasonable investment provides the proper functioning of this sphere, and offers the increase in the data exchange, which is essential for the operability of the executive departments.

International Information Systems Architecture

The steps that are offered by the authors of the book in order to create the international information systems architecture may be regarded as the classical steps, necessary to arrange the perfectly working local data net. The only distinction with the local net is the globalism of the project that would require the increased resources: human, financial and material. There is no need to explain the difference between material and financial resources; however, they are closely linked. It is necessary to emphasize that the very notion of the international information systems architecture includes the creation of the centralized structure that would control the international data exchange process. On the one hand it will help to decrease the spread of spam, porno production and scumware. On the other hand, the centralization of internet contradicts its basic principle.

Anyway, the creation of the international information systems architecture requires the creation of the single standard in data transfer. Actually, the whole world uses single standards, but these are the different standards, and to create the single architecture, the protocol standard should also be single. This would help to simplify the structure of the data nets, and the required equipment, hardware and software provision will require less financial resources.


In conclusion, it is necessary to emphasize that the information system management is a rather complex sphere of management that requires high qualification. The investment into the IT sphere is not beneficial, however it helps to increase the incomes of the whole company, as the market activity requires operability, and quick access to any required information. IT and IS grant this rapid access, thus, there is strong necessity to invest the IT-sphere in spite of the serious limitations, discussed in the corresponding chapter.


Laudon, J. Laudon, K. Management Information Systems. Prentice Hall publishing, 2007