What Are Information Systems? Definitions, Examples & Career Paths
Every time you check a bank balance on your phone, track a package, or register for classes, you rely on an information system (IS). These systems turn raw data into timely answers that help organizations serve customers, manage operations, and make informed decisions.
An information system is a coordinated mix of people, processes, data, and technology that produces useful information on demand. If you’re choosing a major or changing careers, IS offers practical work with real business impact. It also opens pathways to numerous roles, from business analyst to systems manager. Keep reading to learn how information systems deliver the right information at the right time, who depends on them, and what that means for your next step.
What is an Information System?
An information system is an integrated set of components that collects, stores, processes, and outputs information to support an organization’s activities and decisions. That integrated idea matters: the value comes from how the pieces work together to transform data into insight and action.
Every effective information system brings together these building blocks:
- Hardware
Computers, servers, mobile devices, sensors, and peripherals used to capture, store, and deliver information - Software
System software (OS, database engines) and application software (ERP, CRM, analytics tools) that execute tasks and present results - Data and databases
Structured and unstructured data organized so it can be retrieved, combined, and analyzed - Networks
Wired and wireless connections that move data between people, devices, and locations - Processes
Agreed steps and rules for how to collect, secure, analyze, and share data - People
Stakeholders who design, administer, and use the system: analysts, administrators, managers, developers, and end users
A helpful way to remember the essentials comes from the classic “five components” framing (hardware, software, data, procedures, and people), which you’ll still see in many IS courses.
What is the primary purpose of an information system?
At a high level, information systems connect business needs with technology. More concretely, well-designed systems do the following:
- Capture data from internal applications and external sources, organize it for use and deliver the right data to the right people
- Process data into information using calculations, sorting, filtering, and summarization
- Enable collaboration across teams via intranets, shared workspaces, and messaging platforms
- Support decisions with analytics and decision support tools that surface trends, forecasts, and recommendations
Types of Information Systems
Below are common categories you’ll encounter in organizations of all sizes. Each serves a distinct purpose, yet many integrate with one another.
Transaction Processing Systems (TPS)
- Purpose: Handle routine, high-volume transactions reliably and accurately (think sales, deposits, shipments)
- Who uses them: Frontline staff, cashiers, service reps, and the systems that interface with customers
- Example: Point of sale (POS) systems in retail, such as the Walmart checkout system, which tracks sales, inventory, and customer purchases in real time
Management Information Systems (MIS)
- Purpose: Summarize operational data into periodic reports managers use for planning and performance tracking
- Who uses them: Line and mid-level managers across operations, finance, HR, and marketing
- Example: SAP ERP used by Coca-Cola to manage logistics, inventory, and production processes while generating performance reports
Decision Support Systems (DSS)
- Purpose: Combine data, models, and interactive analysis for “what if” questions and scenario planning
- Who uses them: Analysts and managers evaluating options and forecasting outcomes
- Example: IBM's Watson Analytics, used in healthcare to analyze patient data and assist doctors in diagnosing illnesses and recommending treatments
Enterprise Resource Planning Systems (ERP)
- Purpose: Integrate core functions (finance, procurement, supply chain, manufacturing, HR) into one shared system
- Who uses them: Finance, operations, HR, procurement, and leadership teams
- Example: Oracle NetSuite, used by companies such as Airbnb to manage financials, customer relationships, and human resources
Customer Relationship Management Systems (CRM)
- Purpose: Track and manage customer interactions across marketing, sales, and service to improve retention and revenue
- Who uses them: Sales reps, marketers, account managers, and support teams
- Example: Salesforce CRM, used by companies such as American Express, to manage customer support and improve customer engagement
Geographic Information Systems (GIS)
- Purpose: Map, analyze, and visualize location-based data for planning and operations
- Who uses them: Urban planners, utilities, logistics teams, public health agencies, and retailers
- Example: Google Maps is a global information system that analyzes and displays geographically referenced information
Many organizations blend these systems. For instance, transactions flow from TPS into ERP and CRM, then feed BI dashboards that managers use for weekly decisions.
What does an information system consist of? (Putting it together)
To see how parts connect, imagine a mid-size e-commerce brand and how it integrates the following components:
- Hardware and network: Cloud servers host its website; barcode scanners update warehouse inventory; staff use laptops and mobile devices
- Software: An ERP handles orders, inventory, and finances; a CRM manages customer emails and support tickets; a shipping system prints labels and tracks deliveries
- Database layer: Data from orders, returns, and marketing campaigns lives in structured tables that analysts can query
- Processes: Standard procedures govern how data is captured, validated, secured, and archived
- People: Developers maintain integrations, analysts build reports, managers review dashboards to schedule labor and plan promotions
Best Paying Information System Degrees
You can arrive at IS careers through several academic routes. Below are common degrees, the industries they touch, and example roles with national median pay from the U.S. Bureau of Labor Statistics (BLS). Salary outcomes vary by location, experience, and industry; use these as directional benchmarks.
| Degree | What You Learn | Applications | High-paying Roles |
Bachelor of Science in Information Systems or | Systems analysis and design, databases, networking, cybersecurity, project management, and user experience to integrate tech and business | Finance, healthcare, retail, government, consulting, startups | Computer & Information Systems (CIS) Manager – Plans and directs an organization’s IT strategy and operations. Median annual salary: $171,200. Information Security Analyst – Protects systems and data, manages risk and incident response. Median annual salary: $124,910. Database Administrator/Architect – Designs enterprise data structures for performance and governance. Median annual salary: $123,100. Computer Network Architect – Designs resilient on-prem and cloud networks. Median annual salary: $130,390. |
Bachelor of Science in Computer Science or | Algorithms, data structures, operating systems, theory, and advanced programming with options in AI/ML, graphics, or systems | Software, research labs, cloud providers, fintech, and any data-driven organization | Computer & Information Research Scientist – Advances computing through novel algorithms and models. Median annual salary: $140,910. Software Developer – Designs and builds applications and services. Median annual salary: $131,450. Data Scientist – Extracts insight from large datasets using statistics and machine learning. Median annual salary: $112,590. |
Master of Science in Data Science or Master of Science in Data Analytics | Statistical modeling, machine learning, data engineering, visualization, and experiment design | Tech, healthcare, marketing analytics, logistics, energy | Data Scientist – Builds predictive models and decision tools. Median annual salary: $112,590 Operations Research Analyst – Optimizes processes with math and simulation. Median annual salary: $91,290. Database Architect – Crafts scalable data environments for analytics. Median annual salary: $123,100. |
| Master of Science in Software Engineering | Software design, architecture, testing, secure development, DevOps, and product delivery practices | SaaS, mobile, gaming, fintech, cybersecurity | Software Developer – Creates and scales software products and platforms. Median annual salary: $131,450. QA/Test Engineer – Improves reliability through automated and exploratory testing. Median annual salary: $116,000. DevOps Engineer – Often classified under software developers/admin roles. Builds CI/CD pipelines and platform tooling. Median annual salary: $140,000. |
Bachelor of Business Administration (BBA) - Business Technology or | Strategy, finance, and leadership paired with technology management, analytics, and digital transformation | Corporate IT leadership, consulting, product organizations | CIS Manager / IT Director – Leads enterprise technology strategy and teams. Median annual salary: $171,200. Project Management Specialist – Drives complex initiatives from scope to delivery across functions. Median annual salary: $100,750. |
Information System Career Outlook
The broad computer and IT category pays well compared with the economy overall: $105,990 median for the group (May 2024) versus $49,500 across all occupations.
Specific IS-aligned roles show strong demand over the next decade:
- CIS Managers: Projected to grow by 17% from 2023–2033, which is much faster than the average and reflects ongoing digital transformation and cloud adoption
- Information Security Analysts: Projected to grow by 33% over the same period, driven by cybersecurity needs across industries
The bottom line: Organizations rely on information systems to compete, comply, and innovate, which sustains opportunity for professionals who can connect technology with business outcomes.
Where to Build Information Systems Experiences
Pace offers degree pathways that align directly with the roles above:
- BS in Information Systems — Undergraduate foundation in systems design, databases, networks, and business process
- MS in Information Systems — Graduate-level depth in systems design and development, project management, and specialized tracks such as UX, data science, database management, health IS, and security
- BS in Computer Science — Core computing, algorithms, and software foundations for developer and engineering roles
- MS in Computer Science — Advanced topics in algorithms, systems, and modern software development
- MS in Data Science — Statistics, machine learning, and data engineering for analytics and AI-driven roles
- MS in Software Engineering — Architecture, SDLC, quality, and CI/CD for building reliable, scalable software
- BBA in Business Technology — Bridges business strategy and technology for product, operations, and PM roles
- Information Systems MBA — Leadership at the intersection of tech and business, preparing you to direct enterprise initiatives
With these options in mind, explore each program page for curriculum highlights, sample career outcomes, and start terms. If you’d like help narrowing the list, send us a quick message to share a bit about your goals and interests, and we’ll connect you with an advisor to discuss program fit and possible paths. They can help you compare options, think through course planning and timelines, and address common questions about admissions and available resources.
FAQ
What do information systems do?
Information systems collect data, organize it, and deliver the right information to the right people so teams can make decisions, coordinate work, and measure performance. Think of IS as the connective tissue between operations, analytics, and strategy.
What is an example of an information system?
An example of an information system is a CRM that tracks leads, opportunities, and support cases, or an ERP that integrates finance, procurement, inventory, and HR. These systems often feed analytics dashboards used by managers each week. (For location-based work, Geographic Information Systems help map assets and plan routes.)
What is the main purpose of an information system?
The purpose of an information system is to turn raw data into usable information that supports decisions, coordination, and control. The system captures data, processes it, and distributes insights via reports and dashboards so people can act with confidence.