Chap 2 The Strategic Role of Information Systems

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Chap 2 The Strategic Role of Information Systems Powered By Docstoc
					Management Information
 Systems - Class Note # 2




      Prof. Yuan-Shyi Peter Chiu
              Feb. 2012

                                   1
                 Chap 2
       Information Systems in the
              Enterprise

2.1 Key System Applications in the Organization
2.2 Systems from a Functional Perspective
2.3 Integrating Functions and Business
      Processes
2.4 International Information Systems


                                                  2
Fig 2.1: Types of Information Systems   3
                  2.1
      Different kinds of systems

n Operational-level systems
    § Information systems that monitor
       the elementary activities and
       transactions of the organization .

n Knowledge-level systems
    § Information systems that support
      knowledge and data workers in
      an organization.
                       1/2
                                            4
                 2.1
     Different kinds of systems
n Management-level systems
  n Information systems that support the
    monitoring, controlling, decision
    making, and administrative activities
    of middle managers.

n Strategic-level systems
  n Information systems that support the

     long-range planning activities of
     senior management .
                      2/2                   5
        Major Types of Systems

• Executive Support Systems (ESS)
• Decision Support Systems (DSS)
• Management Information Systems (MIS)
• Knowledge Work Systems (KWS)
• Office Automation Systems (OAS)
• Transaction Processing Systems (TPS)



                                         6
Fig 2-2: The six major types of information systems.
                                                       7
                2.1
    Six Major Types of Systems
n TPS – Transaction Processing
           Systems
  n Computerized systems that perform and
    record the daily routine transactions
    necessary to conduct the business;
    they serve the organization’s
    operational level.

                                            8
Fig 2-4: Typical applications of TPS   ■
                                           9
TYPICAL TPS APPLICATIONS
   Sales & Marketing Systems

n MAJOR FUNCTIONS OF SYSTEMS:
  § Sales Management ;
  § Market Research ;
  § Promotion ; Pricing ; New Products
n MAJOR APPLICATION SYSTEMS:
  § Sales Order Info System ;
  § Market Research System ;
  § Pricing System
                          See Fig. 2-4 ( p.43 )
                                                  10
               2.1

TPS – Transaction Processing Systems

  n Manufacturing
      § Plant scheduling
      § Material movement control
      § Machine control
  n Finance
      § Securities trading
      § Cash management
                                       11
                2.1

TPS – Transaction Processing Systems

     n Accounting
        § Payroll
        § Account payable
        § Account receivable
     n Human Resources
        § Compensation
        § Training & development
        § Employee record keeping
                                       12
                      2.1
                       Payroll TPS




                                                        ◆
Fig 2-3: A symbolic representation for a payroll TPS.
                                                        13
               2.1
   Six Major Types of Systems

n KWS – knowledge work systems
 n Information systems that aid
   knowledge workers in the creation
   and integration of new knowledge in
   the organization .

    Example: Engineering work station

                                         14
               2.1
   Six Major Types of Systems

n OAS – office automation systems
 n Computer systems, such as word
   processing, electronic mail systems,
   and scheduling systems, that are
   designed to increase the productivity
   of data workers in the office .



                                           15
               2.1
   Six Major Types of Systems
n MIS   – Management Information
             Systems
 n Information systems at the management
   level of organization that serve the functions
   of planning, controlling, and decision
   making by providing routine summary and
   exception reports.

    Example: Annual budgeting
                                                    16
                 2.1
                 MIS

• Structured and semi-structured decisions

• Report control oriented

• Past and present data

• Internal orientation



                                             17
       TPS DATA FOR MIS APPLICATIONS




Fig 2-5: How management information systems obtain their data
                the from the organization’s TPS .               18
               2.1
   Six Major Types of Systems

n DSS   – Decision Support Systems
  n Information systems at the
    management level of an organization
    that combine data and sophisticated
    analytical models to support non-
    routine decision making.

    Example: Contract cost analysis

                                          19
           Decision Support System (DSS)




                                                       ◆
Fig 2-7: Voyage estimating decision-support system .
                                                       20
               2.1

           MIS & DSS

n Sales and marketing
    § Sales management
    § Sales region analysis

n   Manufacturing
    § Inventory control
    § Production scheduling

                              21
           2.1
        MIS & DSS
n Finance
 § Annual budgeting
 § Cost analysis
n Accounting
 § Capital investment analysis
 § Pricing / profitability analysis
n Human Resource
 § Relocation analysis
 § Contract cost analysis
                                      22
               2.1
   Six Major Types of Systems

n ESS – Executive Support Systems
  n Information system at the
    organization’s strategic level designed
    to address unstructured decision
    making through advanced graphics
    and communications.

    Example: 5-year operating plan
                                              23
                2.1
               ESS
• Top level management

• Designed to the individual

• Ties CEO to all levels

• Very expensive to keep up

• Extensive support staff
                               24
          Executive Support System (ESS)




                     Figure 2-8

Fig 2-8: Model of a typical executive support system .
                                                         25
                  2.1
                  ESS

n Sales and marketing § Sales trend
                              forecasting
n Manufacturing         § Operating plan
n Finance               § Budget forecasting
n Accounting            § Profit planning

n Human Resource        § Personnel planning
                                               26
              2.1
Characteristics of Different Types
    of Information Systems

  n Information inputs
  n Processing
  n Information outputs
  n Users

                    See Table 2-1 ( p.41 )
                                             27
2.2 Systems from a Functional Perspective




       Fig 2-9: Interrelationships among systems   28
2.2 Systems from a Functional Perspective


  n SALES & MARKETING SYSTEMS
  n MANUFACTURING & PRODUCTION
       SYSTEMS

  n FINANCE & ACCOUNTING SYSTEMS
  n HUMAN RESOURCES SYSTEMS



                                        29
2.2 Systems from a Functional Perspective

        Sales and Marketing Systems

  Major functions of systems:
  n   Sales management, market research, promotion,
      pricing, new products


  Major application systems:
  n   Sales order info system, market research system,
      pricing system

                                                         30
Sales and Marketing Systems




                              31
2.2 Systems from a Functional Perspective

 Manufacturing and Production Systems
  Major functions of systems:
  n   Scheduling, purchasing, shipping, receiving,
      engineering, operations

  Major application systems:
  n   Materials resource planning systems, purchase
      order control systems, engineering systems,
      quality control systems

                                                      32
Manufacturing and Production Systems




                                       33
2.2 Systems from a Functional Perspective


   Financing and Accounting Systems
  Major functions of systems:
  n   Budgeting, general ledger, billing, cost
      accounting


  Major application systems:
  n   General ledger, accounts receivable, accounts
      payable, budgeting, funds management systems

                                                      34
Financing and Accounting Systems




                                   35
2.2 Systems from a Functional Perspective


          Human Resource Systems
  Major functions of systems:
  n   Personnel records, benefits, compensation, labor
      relations, training


  Major application systems:
  n   Payroll, employee records, benefit systems,
      career path systems, personnel training systems

                                                         36
Human Resource Systems




                         37
2.3 Business Processes and
            Information Systems
 Business processes

 n   Manner in which work is organized, coordinated,
     and focused to produce a valuable product or
     service
 n   Concrete work flows of material, information, and
     knowledge—sets of activities
 n   Unique ways to coordinate work, information, and
     knowledge

 n   Ways in which management chooses to coordinate
     work                                           38
2.3    Business Processes and Information Systems


      Examples of Business Processes

  n   Manufacturing and production: Assembling
      product, checking quality, producing bills of
      materials


  n   Sales and marketing: Identifying customers,
      creating customer awareness, selling



                                                      39
2.3   Business Processes and Information Systems




 Cross-Functional Business
 Processes
        Fig. 2-12 The Order Fulfillment Process

                                                   40
2.3    Business Processes and Information Systems




Information systems help organizations

n   Achieve great efficiencies by automating
    parts of processes

n   Rethink and streamline processes



                                                    41
2.3     Business Processes and Information Systems


 Customer Relationship Management (CRM)

 n   Manages all ways used by firms to deal with
         existing and potential new customers
 n   Uses information system to coordinate entire business
         processes of a firm
 n   Provides end-to-end customer care
 n   Provides a unified view of customer across the company
 n   Consolidates customer data from multiple sources and
        provides analytical tools for answering questions



                                                              42
2.3   Business Processes and Information Systems
        Customer Relationship Management (CRM)




                      Figure 2-13
                                                   43
2.3    Business Processes and Information Systems

Supply Chain Management (SCM)
•Close linkage and coordination of activities involved in
buying, making, and moving a product
•Integrates supplier, manufacturer, distributor, and
customer, logistics, time
•Reduces time, redundant effort, and inventory costs
•Network of organizations and business processes
•Helps in procurement of materials, transformation of
raw materials into finished products
•Helps in distribution of the finished products to
customers
• Includes reverse logistics - returned items flow in the
       reverse direction from the buyer back to the seller
                                                             44
2.3   Business Processes and Information Systems




                Supply Chain Management
                      Figure 2-14
                                                   45
2.3 How Information Systems Facilitate
            Supply Chain Management

•Decide when, what to produce, store, move
•Rapidly communicate orders
•Communicate orders, track order status
•Check inventory availability, monitor levels
•Track shipments
•Plan production based on actual demand
•Rapidly communicate product design change
•Provide product specifications
•Share information about defect rates, returns
                                                 46
2.3 Collaborative Commerce




          Figure 2-15
                             47
2.3 Enterprise System




       Figure 2-17      48
2.4 Global System Configuration




            Figure 2-18
                                  49
     HOMEWORK Chap.2
#1     #2        #3
# 7     #8         #9
# 10: What is CRM?
# 11: What is SCM?
# 12


         ~ THE END ~
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