A computer-based information system, or CBIS, uses computers to collect, process, store, analyze and distribute information for a specific purpose, such as meeting a business objective. The main components of a CBIS include hardware, software, data, procedures and people.
In a CBIS, the hardware is the physical machinery, such as a computer, printer, display screen and cables. The hardware devices work together to accept data, or raw facts, as input before processing the data into useful information and then displaying the information as output. Software refers to computer programs that provide instructions for processing the data. The procedures are what people perform when working with a CBIS to process data and produce information.
Traditionally, a business uses four types of computer-based information systems. The one used by the most people in the business is a transaction processing system, which processes events or activities that affect the entire organization, such as customer orders. A management information system provides information to managers so that they can plan and run the business. Managers also use decision support systems when making major decisions that affect the entire business. Senior executives use a special type of decision support system known as an executive information system, which provides an overview of the entire business.