Info Systems: Definitions, Types, Roles & Hotel Applications

What is an Information System (IS)?

An Information System (IS) is a combination of hardware, software, data, people, and processes that work together to collect, process, store, and distribute information to support decision-making and operations in an organization.

Key Components of an IS

mindmap
  root((Information System))
    Hardware
    Software
    Data
    People
    Processes
    Network

Why does this matter?

• Hardware (computers, servers, POS systems) is the physical backbone.
• Software (ERP, CRM, hotel management software) enables functionality.
• Data (guest records, inventory, sales) is the raw material.
• People (staff, managers, IT teams) interact with the system.
• Processes (check-in, billing, reporting) define how work flows.
• Network (Wi-Fi, cloud) connects everything.

Types of Information Systems in Hospitality

Hospitals, airlines, and hotels use different IS types based on their needs. Below is a comparison:

How Information Systems Work in Hotels

Let’s trace how a guest booking flows through different IS types in a hotel:

1. TPS (Transaction Processing System)

   • Guest books a room via online portal (Daraz Travel, Booking.com) or hotel PMS (Property Management System).
   • System records:
     • Guest name, room type, check-in/out dates.
     • Payment (credit card, Khalti, eSewa).
   • Example: When you book a room on Pathao’s hotel partner app, the TPS instantly confirms availability and processes payment.

2. MIS (Management Information System)

   • At end of day, the system generates reports:
     • Occupancy rate (50% vs. target 70%).
     • Revenue per available room (RevPAR).
     • Staff productivity (housekeeping vs. front desk).
   • Managers use this to adjust pricing or staffing.

3. DSS (Decision Support System)

   • If occupancy is low, the DSS suggests:
     • "Run a 20% discount for next 3 days."
     • "Increase marketing on Facebook/Instagram."
   • Example: Toyota Premier Inn uses AI to predict demand and adjust rates in real time.

4. ESS (Executive Support System)

   • The General Manager sees a dashboard with:
     • Yearly revenue trend (vs. last year).
     • Competitor analysis (how Marriott vs. Hyatt performs in Kathmandu).
   • Helps in long-term decisions like expanding to Pokhara.

IMAGE: Hotel Property Management System (PMS) Dashboard

hotel property management system dashboard | A screenshot of a PMS showing occupancy, revenue, and guest history.

In the Real World

1. Daraz (Nepal) – Using TPS & CRM

• What it uses: Transaction Processing System (TPS) for orders and Customer Relationship Management (CRM) for reviews.
• How it works:
  • When you order groceries, Daraz’s TPS processes payment (Khalti/eSewa) and updates inventory.
  • After delivery, the CRM asks for a review (which helps in reputation management).
• Why it matters: Faster transactions + better customer trust = more sales.

2. Nabil Bank – Using DSS for Loan Approvals

• What it uses: Decision Support System (DSS) for loan risk assessment.
• How it works:
  • When you apply for a home loan, the bank’s DSS checks:
    • Your credit score (from Fitch/Nepal Rastra Bank data).
    • Income stability (salary slips, business records).
    • Market trends (interest rates, property prices in Kathmandu).
  • The system scores your risk (low/medium/high) and suggests approval/rejection.
• Why it matters: Reduces human bias and speeds up loan processing.

3. Pathao (Ride-Hailing) – Using Real-Time DSS

• What it uses: Decision Support System (DSS) for dynamic pricing and route optimization.
• How it works:
  • If traffic is heavy on Ring Road, Pathao’s DSS:
    • Increases fare by 30% (to balance supply-demand).
    • Suggests alternative routes to drivers via GPS.
  • If demand drops at night, fares decrease to attract riders.
• Why it matters: Keeps drivers happy (better earnings) and riders satisfied (faster rides).

How Hotels Use Information Systems

Let’s take Hotel Himalaya (Kathmandu) as a case study.

Case Study: Hotel Himalaya’s IS Integration

flowchart TD
    A["Guest Books Online<br/>(Daraz Travel/Booking.com)"] --> B["TPS: Reservation & Payment"]
    B --> C["PMS: Room Assignment<br/>(Housekeeping Alert)"]
    C --> D["MIS: Daily Reports<br/>(Occupancy, Revenue)"]
    D --> E["DSS: Dynamic Pricing<br/>('Offer 15% off for low demand')"]
    E --> F["ESS: GM Dashboard<br/>(Yearly Performance vs. Competitors)"]
    F --> G["CRM: Guest Feedback<br/>(Loyalty Program Updates)"]

Key Takeaways from the Case:

1. Seamless Guest Experience – No double-bookings, instant confirmation.
2. Cost Savings – Automated billing reduces errors.
3. Data-Driven Decisions – If occupancy drops, the DSS suggests promotions.
4. Competitive Edge – CRM keeps guests loyal (e.g., Marriott Bonvoy points).

Advantages & Disadvantages of Information Systems in Hospitality

Exam Tip: How This Unit is Tested

1. Definitions & Differences
   • Expect short-answer questions like:
     • "Differentiate between TPS and MIS with hotel examples."
     • "What is the role of DSS in dynamic pricing?"
   • Solution: Use the comparison table above and real-world examples (Daraz, Nabil Bank, Pathao).

2. Case Study Analysis

   • You may get a scenario like:

     "A 5-star hotel in Thamel wants to reduce no-shows. Which IS type should they use and why?"

   • Solution:
     • Use DSS to predict cancellations based on past data.
     • Implement a deposit system (TPS) to confirm bookings.
     • Send automated reminders (CRM) via email/SMS.

3. Diagrams & Flowcharts

   • Draw a simple flowchart showing how a guest booking moves through TPS → MIS → DSS.
   • Example:

flowchart TD
    A["Guest Books Room Online"] -->|"1. TPS"| B[Reservation Confirmed
Payment Processed]
    B -->|"2. PMS"| C[Room Assigned
Housekeeping Alert]
    C -->|"3. MIS"| D[Occupancy Report
Generated]
    D -->|"4. DSS"| E[Pricing Adjustment
If Demand <70%]
    E -->|"5. ESS"| F[GM Dashboard
Updated]

4. Real-World Applications
   • Always relate to Nepal:
     • "How does eSewa use TPS?" → Payment processing.
     • "How does NTC use MIS?" → Network performance reports.
     • "How does Daraz use CRM?" → Guest reviews & loyalty programs.

Summary: Key Takeaways for Exam

• Information System = Hardware + Software + Data + People + Processes + Network.
• Types of IS:
  • TPS (transactions) → MIS (reports) → DSS (decisions) → ESS (strategy).
• Hospitality uses:
  • PMS (Property Management System) for daily operations.
  • CRM for guest loyalty (like Marriott Bonvoy).
  • DSS for pricing (like Toyota Premier Inn).
• Real-world examples:
  • Daraz (TPS + CRM).
  • Nabil Bank (DSS for loans).
  • Pathao (DSS for dynamic pricing).
• Exam focus:
  • Define, compare, and apply IS types to hotel scenarios.
  • Draw flowcharts for processes (booking, billing, reporting).
  • Use Nepali examples (eSewa, Daraz, NTC, banks).