PPT2 - Information Systems in The Enterprise

Information Systems in the Enterprise
2.1
Management Information Systems

Information Systems in the Enterprise OBJECTIVES
Evaluate the role played by the major types of systems in a business and their relationship to each other Describe the information systems supporting the major business functions: sales and marketing, manufacturing and production, finance and accounting, and human resources
2.2

Information Systems in the Enterprise OBJECTIVES (continued)
Analyze the relationship between organizations, information systems, and business processes Explain how enterprise applications promote business process integration and improve organizational performance Assess the challenges posed by information systems in the enterprise and management solutions
2.3

Information Systems in the Enterprise Mango Case: Fast Fashion, Hot Systems
Challenge: monthly changes in fashions; Mango has 731 stores in 72 countries Solutions. Inventory replenishment system tracks all sales and matches stores with inventory. Design teams meet weekly to adjust to trends. Distribution system allocates bar-coded items to specific stores based on store/product mix. Reduces time to market, increases agility Increases accuracy of decision making
2.4

Information Systems in the Enterprise MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS
Types of Information Systems
2.5
Figure 2-1

Different Kinds of Systems

Three main categories of information systems serve different organizational levels: 1. Operational-level systems: support operational managers, keeping track of the elementary activities and transactions Management-level systems: serve the monitoring, controlling, decision-making, and administrative activities Strategic-level systems: help senior management tackle and address strategic issues
2.
3.
2.6

Major Types of Systems Transaction Processing Systems (TPS) Management Information Systems (MIS) Decision-Support Systems (DSS) Executive Support Systems (ESS)
2.7

The Four Major Types of Information Systems
2.8
Figure 2-2

Transaction Processing Systems (TPS)
Basic business systems that serve the operational level A computerized system that performs and records the daily routine transactions necessary to the conduct of the business
2.9

A Symbolic Representation for a Payroll TPS
2.10
Figure 2-3

Typical Applications of TPS
2.11
Figure 2-4

Management Information Systems (MIS) Management level Inputs: High volume transaction level data Processing: Simple models Outputs: Summary reports Users: Middle managers Example: Annual budgeting
2.12

Management Information Systems (MIS) (continued)
2.13
Figure 2-5

Management Information Systems (MIS) (continued)

A sample MIS report
2.14
Figure 2-6

Decision-Support Systems (DSS) Management level Inputs: Transaction level data Processing: Interactive Outputs: Decision analysis Users: Professionals, staff Example: Contract cost analysis
2.15

Decision-Support Systems (DSS) (Continued)

Voyage-estimating decision-support system
2.16
Figure 2-7

EXECUTIVE SUPPORT SYSTEMS (ESS): Inputs: Aggregate data Processing: Interactive Outputs: Projections Users: Senior managers Example: 5 year operating plan
2.17

Model of a Typical Executive Support System
2.18
Figure 2-8

EXECUTIVE SUPPORT SYSTEMS (ESS) (Continued) Top Level Management Designed to the individual senior manager Ties CEO to all levels Very expensive to keep up Extensive support staff
2.19

Relationship of Systems to One Another

Interrelationships among systems
2.20
Figure 2-9

Relationship of Systems to One Another In contemporary digital firms, the different types of systems are closely linked to one another. This is the ideal. In traditional firms these systems tend to be isolated from one another, and information does not flow seamlessly from one end of the organization to the other. Efficiency and business value tend to suffer greatly in these traditional firms
2.21

Information Systems in the Enterprise SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
Sales and Marketing Systems Major functions of systems: Sales management, market research, promotion, pricing, new products Major application systems: Sales order info system, market research system, pricing system
2.22

Sales and Marketing Systems

SYSTEM DESCRIPTION ORGANIZATIONAL LEVEL
Order processing
Enter, process, and track orders
Operational
Pricing analysis
Determine prices for products and services
Management
Sales trend forecasting
Prepare 5-year sales forecasts
Strategic
Table 2-2
2.23

Manufacturing and Production Systems Major functions of systems: Scheduling, purchasing, shipping, receiving, engineering, operations Major application systems: Materials resource planning systems, purchase order control systems, engineering systems, quality control systems
2.24

Manufacturing and Production Systems

Machine control
Control the actions of machines and equipment
Operational
Production planning
Decide when and how many products should be produced
Management
Facilities location 2.25
Decide where to locate new production facilities
Strategic

Overview of an Inventory System
2.26
Figure 2-10

Financing and Accounting Systems Major functions of systems: Budgeting, general ledger, billing, cost accounting Major application systems: General ledger, accounts receivable, accounts payable, budgeting, funds management systems
2.27

Financing & Accounting Systems (Continued)

Accounts receivable
Tracks money owed the firm
Operational
Budgeting
Prepares short-term budgets
Management
Profit planning 2.28
Plans long-term profits
Strategic
Table 2-4

Human Resource Systems Major functions of systems: Personnel records, benefits, compensation, labor relations, training Major application systems: Payroll, employee records, benefit systems, career path systems, personnel training systems
2.29

Human Resource Systems (Continued)

SYSTEM DESCRIPTION ORGANIZATIONAL LEVEL Operational
Training and development
Tracks employee training, skills, and performance appraisals
Compensation analysis
Monitors the range and distribution of employee wages, salaries, and benefits Plans the long-term labor force needs of the organization
Management
Human resources planning
Strategic
Table 2-5
2.30

Information Systems in the Enterprise SYSTEMS FROM A FUNCTIONAL PERSPECTIVE Human Resource Systems (Continued) An Employee Recordkeeping System
2.31
Figure 2-11

Information Systems in the Enterprise INTEGRATING FUNCTIONS AND BUSINESS PROCESSES: Introduction to Enterprise Applications
Business Processes and Information Systems Business processes: Manner in which work is organized, coordinated, and focused to produce a valuable product or service Concrete work flows of material, information, and knowledge knowledgesets of activities Unique ways to coordinate work, information, and knowledge Ways in which management chooses to coordinate work
2.32

Business Processes and Information Systems (Continued) Information systems help organizations achieve great efficiencies by automating parts of processes IS also contributes to completely rethinking processes. Business processes typically span several different functional areas.
2.33

Examples of Business Processes Manufacturing and production: Assembling product, checking quality, producing bills of materials Sales and marketing: Identifying customers, creating customer awareness, selling
Table 2.6
2.34

Examples of Business Processes (Continued) Finance & accounting accounting: Paying creditors, creating financial statements, managing cash accounts Human resources resources: Hiring employees, evaluating performance, enrolling employees in benefits plans
Table 2.6 continued
2.35

Business Processes and Information Systems CrossCross-Functional Business Processes: Transcend boundary between sales, marketing, manufacturing, and research and development Group employees from different functional specialties to a complete piece of work Example: Order Fulfillment Process
2.36

The Order Fulfillment Process
2.37
Figure 2-12

Systems for Enterprise-Wide Process Integration Enterprise applications: Designed to support organization-wide process organizationcoordination and integration
2.38

Systems for Enterprise-Wide Process Integration (Continued) Consist of : Enterprise systems Supply chain management systems Customer relationship management systems Knowledge management systems
2.39

Enterprise Systems Enterprise systems, also known as enterprise resource planning (ERP) systems, provide a single information system for organization-wide organizationcoordination and integration of key business processes. Information that was previously fragmented in different systems can seamlessly flow throughout the firm so that it can be shared by business processes in manufacturing, accounting, human resources, and other areas.
2.40

Enterprise Application Architecture
2.41
Figure 2-13

Traditional Silo View of Information Systems Within the business: There are functions, each having its uses of information systems Outside the organizations boundaries: There are customers and vendors Functions tend to work in isolation
2.42

Traditional View of Systems
2.43
Figure 2-14

Enterprise Systems
2.44
Figure 2-15

Benefits of Enterprise Systems Help to unify the firms structure and organization: One organization Management: Firm wide knowledge-based knowledgemanagement processes Technology: Unified platform Business: More efficient operations & customercustomerdriven business processes
2.45

Challenges of Enterprise Systems Difficult to build: Require fundamental changes in the way the business operates Technology: Require complex pieces of software and large investments of time, money, and expertise Centralized organizational coordination and decision making: Not the best way for the firms to operate
2.46

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
2.47

Supply Chain Management (SCM) Helps in procurement of materials, transformation of raw materials into intermediate and 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
2.48

Haworths Supply Chain Management Systems
2.49
Figure 2-16

Information from Supply Chain Management Systems helps firms: Decide when and what to produce, store, and move Rapidly communicate orders Track the status of orders Check inventory availability and monitor inventory levels
2.50

Information from Supply Chain Management Systems helps firms: (Continued) Reduce inventory, transportation, and warehousing costs Track shipments Plan production based on actual customer demand Rapidly communicate changes in product design
2.51

Customer Relationship Management (CRM) Manages all ways used by firms to deal with existing and potential new customers Business and technology discipline Uses information system to coordinate entire business processes of a firm
2.52

Customer Relationship Management (CRM) (Continued) Provides end- to- end customer care end- to Provides a unified view of customer across the company Consolidates customer data from multiple sources and provides analytical tools for answering questions
2.53

Customer Relationship Management (CRM)
2.54
Figure 2-17

Knowledge Management Systems Collects relevant knowledge and make it available wherever and whenever it is needed Support business processes and management decisions Also link the firm to external sources of knowledge Support processes for acquiring, storing, distributing, and applying knowledge
2.55

Information Systems in the Enterprise MANAGEMENT OPPORTUNITIES, CHALLENGES, AND SOLUTIONS
Management Opportunities:
There are extraordinary opportunities to use information systems to achieve business value, and increase profitability
2.56

Management Challenges: Integration and the whole firm view: Given the different interests and perspectives within a firm, it is difficult to achieve consensus about the need for the "whole firm" viewpoint. Management and employee training: Training a large number of employees on many systems in a large organization involves commensurately large investments.
2.57

Management Challenges: (Continued)
Accounting for the cost of systems and managing demands for systems: Given the large number of different types of systems in a firm, and the large number of people involved with using them, it is a complex task to understand which systems are truly necessary and productive with high returns on investment
2.58

Solution Guidelines: Inventory the firms information systems: Develop a list of firm-wide information requirements to give firma 360-degree view of the most important 360information needs of the firm. Employee and management education: Ensure that you understand how much training is required. Account for the costs and benefits: Develop an accounting system for information services firmfirmwide.
2.59

PPT2 - Information Systems in The Enterprise

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Information Systems in the Enterprise

Management Information Systems

Management Information Systems

Management Information Systems

Management Information Systems

Types of Information Systems

Management Information Systems

Different Kinds of Systems

Management Information Systems

Management Information Systems

The Four Major Types of Information Systems

Management Information Systems

Transaction Processing Systems (TPS)

Management Information Systems

A Symbolic Representation for a Payroll TPS

Management Information Systems

Typical Applications of TPS

Management Information Systems

Management Information Systems

Management Information Systems (MIS) (continued)

Management Information Systems

Management Information Systems (MIS) (continued)

Management Information Systems

Management Information Systems

Decision-Support Systems (DSS) (Continued)

Management Information Systems

Management Information Systems

Model of a Typical Executive Support System

Management Information Systems

Management Information Systems

Relationship of Systems to One Another

Management Information Systems

Management Information Systems

Management Information Systems

Sales and Marketing Systems

Enter, process, and track orders

Determine prices for products and services

Sales trend forecasting

Prepare 5-year sales forecasts

Management Information Systems

Management Information Systems

Manufacturing and Production Systems

Control the actions of machines and equipment

Decide when and how many products should be produced

Facilities location 2.25

Decide where to locate new production facilities

Management Information Systems

Overview of an Inventory System

Management Information Systems

Management Information Systems

Financing & Accounting Systems (Continued)

Tracks money owed the firm

Prepares short-term budgets

Profit planning 2.28

Plans long-term profits

Management Information Systems

Management Information Systems

Human Resource Systems (Continued)

Training and development

Tracks employee training, skills, and performance appraisals

Human resources planning

Management Information Systems