Basic Business Information Systems
Flow of Goods
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Basic Business Functions
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Sales Activities
Entering customer orders Billing customers Collecting customer payments
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Sales Information Flow
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Sales Process
Customer places an order
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Sales Process (cont’d)
The sales department prepares a sales order
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Sales Process (cont’d)
The shipping department ships the order
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Sales Process (cont’d)
The billing department sends the customer
an invoice along with the order or separately
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Sales Process (cont’d)
Billing may send the customer a statement
that indicates outstanding unpaid orders
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Sales Process (cont’d)
The accounts receivable department (A/R)
tracks unpaid orders by customer
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Inventory Activities
Tracking inventory movement Reporting on inventory
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Inventory Information Flow
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Inventory Tracking and Reporting Process
Based on inventory shipped,(Figure 2.8),
inventory is reordered as needed
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Inventory Tracking and Reporting Process (cont’d)
Inventory is received
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Inventory Tracking and Reporting Process (cont’d)
Inventory valuation reports are prepared
periodically to report on inventory status
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Purchasing Activities
Purchasing inventory Paying bills
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Purchasing Information Flow
• INSERT Figure 2.7
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Purchasing Process
Using inventory control information, a
purchase order (P.O.) is prepared
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Purchasing Process (cont’d)
Outstanding monies owed to vendors are
tracked by accounts payable (A/P)
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Basic Information Processing
Entering customer orders Billing customers
Collecting customer payments Tracking inventory Purchasing inventory
Paying bills Paying employees
Reporting financial information
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Basic Business Functions
Accounting
– Record and report data about cash, equipment owned, liabilities (money’s owed), revenue, and expenses
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General Ledger (G/L)
Purpose : 1) Maintain business accounts + 2) Prepare for the production of financial statements and reports (TPL/BS) – GL ties all systems together like A/P and A/R are tied closely to G/L
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Account Payable (A/P)
Purpose : keep track of money owed by the
business. Inputs : Purchase order data, invoice data, receiving notice data Outputs : Payment and account payable report N.B. Systems ensure the figures are correct. If mismatch, contact the suppliers to correct.
Basic Business Functions
Marketing
– Sells goods and/or services – Determines & executes pricing strategies – Advertises the goods and/or services – Distribute sold products
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Marketing
– Sales analysis (good / bad products) – Sales forecasting (project future sales) – Market research (identify trends) – Advertising (ads, mailings etc) – Electronic commerce (www.) – Sales force automation (provide equipment to salesman for promotion)
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Payroll
Purpose : Prepare payments to employees
(cheque / funds transfer to bank a/c) Input : Employee’s work report / time card / confirmation of continued employment Output : payment and payroll summary
Human Resource Management
– – – – Determines human resource needs Assesses skills for selection of new hires Interview job applicant Hires, trains, compensates, and terminates employees – Performance appraisal – Administer MPF – Manage employee fringe benefits (e.g. insurance, vacation leaves, boat trip)
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Basic Business Information Systems
Manufacturing
– Production scheduling – Materials resource planning (MRP) – Mfg. resource planning (MRPII) – Just-in-time inventory management – Computer-aided design (CAD)
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Basic Business Information Systems
Manufacturing (cont’d)
– Computer-aided manufacturing (CAM) – Computer-integrated manufacturing (CIM)
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End of Lecture