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Chapter 3Information

Systemsin Business Functions

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Effectiveness and Efficiency

ISs can help companies attain more effective and efficient business processes.

– Effectiveness• The degree to which a task is accomplished

– Efficiency• Determined by the relationship between

resources expended and benefits gained in achieving a goal

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Effectiveness and Efficiency

Information technology supports a variety of business functions

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Accounting

AISs automatically post transactions in the books and automate generation of reports for management and legal requirements.

Three types of AISs– Transaction processing systems (TPS)– Cost accounting systems– Managerial accounting systems

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Accounting information Systems include features that reflect up-to-date performance of the organization in

financial terms.

Accounting

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Finance

The job of financial managers is to manage money as efficiently as possible by: – Collecting payables as soon as possible

– Making payments by the latest time allowed by contract or law

– Ensuring that sufficient funds are available for day-to-day operations

– Taking advantage of opportunities to accrue the highest yield on funds not used for current activities

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Finance

Financial information systems help manage cash and investment portfolios.

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Engineering

ISs reduce engineering lead time or time-to-market.

– Key to maintaining a competitive edge

– Computer-Aided Design (CAD) Systems • Help engineers and technicians design new

products and quickly modify and store drawings electronically.

– Rapid Prototyping: Creating one-of-a-kind products to test design in three dimensions.

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Engineering

Engineering information systems aid

engineers in designing new products and simulating operations.

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Manufacturing andInventory Control

IT helps in these manufacturing activities:

– Plant activity scheduling– Material requirement assessment– Material reallocation between orders– Dynamic inventory management– Grouping work orders by “characteristics” – Resource qualification for task completion

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Manufacturing andInventory Control

Manufacturing and inventory control IS

help reduce cycle times and the cost of maintaining inventory.

12Materials requirement planning and manufacturing resource planning

Materials Requirement Planning (MRP)

– Take customer demand as initial input

• Number of product units needed and when they are needed

– Help reduce inventory cost while ensuring availability

Manufacturing andInventory Control

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Sales Force Automation– Equipping salespeople with information

technology to facilitate productivity.• IT allows salespeople to present different

options for products and services on the spot.

Customer Service– Customer service via the Web is available

24 hours/day, 7 days/week.• Saves companies labor hours and telephone

expenses

Marketing, Sales, and Customer Service

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Human Resources Human resource management information systems help managers

optimize the assignment of employees and provide payroll, benefits, and other employee-related services.

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Human Resources

Employee Record Management– Reduce space needed to store

records, time to retrieve them, and costs of both

Promotion and Recruitment– Search databases for qualified

personnel

– Use intranet to post job vacancies

– Use the Web to recruit

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Training– Multimedia software training is replacing

classrooms and teachers.

– Training software simulates an actual task or situation and includes evaluation tools.

Evaluation– Evaluation software helps standardize the

evaluation process and adds a certain measure of objectivity and consistency.

Human Resources

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Groupware andCollaborative Work

GroupWare lets workers in different locations communicate ideas, brainstorm, and work together as if they were in the same place.

Document Control– Users can distribute and track electronic

documents without working with outdated information.

Collaborative Projects– Users can coordinate work on a single

document from many different terminals.