Types of System


System has been classified in different ways. Some popularly known classifications are

  1. Physical and Abstract System
  2. Open and Closed System
  3. Formal and Informal Information System
  4. Computer Based Information System
  • Management Information System (MIS)
  • Decision Support System (DSS)
  1. Physical and Abstract System

Physical systems are tangible entities that may be static or dynamic in operation.

Static systems are those systems in which each entity has its own physical existence, which can be seen, touched and counted. For example, the physical parts of the computer center are the offices, desks and the chairs that facilitate the operation of the computer. They can be seen and counted.
In contrary, Dynamic system responds to various demands made by the user. Data, program, output and specification changes as the user demands.

Abstract system are conceptual and non-physical entities. Or in other words, Abstract systems are used for describing data and data relationships in accordance with concept. They may be straight forward as formula of relationship among the set of variables. The main objective of abstract model is that it seems to be easier for the analyst to visualize relationship among the system under study and point out the components and interrelationship among them.

Open and Closed System

An open system is a state of a system, in which a system continuously interacts with its environment. Open systems have many interfaces with environment. It permits interaction across boundary. It receives input from and delivers output to the outside world. It visualizes organizations taking inputs such as raw material, labour, capital and competitive information from the larger environment. Operations are performed on the input and combined with the managerial process to produce desirable results which are distributed back to the environment.

A closed system is a system in the state of being isolated from the environment. Or in other words, A closed system is the one which do not interact with the environment i.e., it has no input or output. Whatever environment surrounds, the closed system do not the change, or if it does, a barrier exist between the environment and the system to prevent the system from being affected.

It is often used to refer to a theoretical scenario where perfect closure is an assumption, however no system can be completely closed; there are only varying degrees of closure.


A formal information system is based on the organization represented by the organization chart. An organization chart is a flow chart that identifies the organizational element of a business and displays areas of responsibility and lines of authority. It is the responsibility of top management to define and to update the organization chart. It is concerned with the pattern of authority, communication and work flow.

Formal system follows certain formalities i.e, they follow a step by step procedure. An informal information system do not folkw formalities. If is an employee based

system, designed to meet personnel and vocational needs and to help solve work related problems. It also funnels information upwards through indirect channels. In this respect, it is a useful system because it works within the boundaries and framework of the business and stated policies.


These days information system relies on computer for the storage, retrieval of data. Computer are used to make business application. These days system analysis heavily relies on computer to solve the business problem.

Major categories of CBIS available these days are :

  • Management Information System (MIS)
  • Decision Support System (DSS)

Management Information System (MIS)

A management information system is an information system application that provide for management oriented reporting. These reports are usually generated on a predetermined schedule and appears in a predefined format.

An MIS is a set of computer based system and procedure implemented to help managers in their crucial job of decision making. The actual process will involve the collection, organization, distribution and storage of organization wide information for managerial analysis and control.

MIS is a person machine system and highly integrated grouping of information processing functions designed to provide management with a comprehensive picture of specific operations.

Management information system is made up of 3 components :

  • Management : Emphasizing the ultimate use of such information system for decision making.
  • Information : Information highlighting on processed data rather than the raw data and in the context in which managers and other end users use it.
  • System : System emphasizing a fair degree of integration.

Examples of MIS are :

  • Inventory Reporting
  • Sales Forecasting
  • Sales Reporting
  • Financial Reporting
  • Salary Analysis

Decision Support System

A key factor in a use of decision support system is determining what information is needed. DSS advances the capabilities of MIS. It assist management in decision making. All type of DSS help managers to answer the question relevant to a decision situation. The question may be complex, simple and after somewhat simplistic.

A DSS is an interactive computer based system intended to help managers to make decisions. A DSS helps a manager to retrieve, summarize and analyze decision relevant to data.

The origin of the term is simple :

  • Decision : Emphasizes decision making in problem situation, not in information processing, retrieval or reporting.
  • Support : Requires computer aided decision situations with enough “structure” to permit computer support.
  • System : Accentuates the integrated nature of problem solving, suggesting a combined man, machine and decision environment.

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