Basically an Information System handles the flow and maintenance of information that supports a business or some other operation. It contains information about significant people, places and things within the organization or in the environment surrounding it. Information is derived from meaningful interpretation of data. Data consists of the raw facts representing events occurring in the organization before they are organized into an understandable and useful form for humans.
An Information System can be defined technically as a set of interrelated components that collect or retrieve, process, store and distribute information to support decision making and control in an organization. A system which assembles, stores, processes, and delivers information relevant to an organization or to a society, in such a way that the information is accessible and useful to those who wish to use it, including managers, staff, clients and citizens. An information system is a human activity (social) system, which may or may not involve the use of computer systems. Also, in addition to supporting decision-making, information systems help workers and managers to analyze complex problems, to develop new products and to integrate the various modules and departments. Moreover the 'transmission losses'n inter-departmental communication are reduced considerably leading to better coordination and improved transparency (information sharing) within the organization as a whole. Three activities provide the information that organizations need. These activities are Input, Processing and Output. 'Input' consists of acquisition of the 'raw data', which is transformed into more meaningful packets of 'Information' by means of 'Processing'. The processed information now flows to the users or activities also called as 'Output'. The shortcomings are analyzed and the information is sent back to the appropriate members of the organization to help them