lecturer: gareth jones. what are the major features of a business that are important for...
TRANSCRIPT
• What are the major features of a business that are important for understanding the role of information systems?
• How do information systems support the major business functions: sales and marketing, manufacturing and production, finance and accounting, and human resources?
• How do systems serve the various levels of management in a business and how are these systems related?
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• How do enterprise applications, collaboration and communication systems, and intranets improve organizational performance?
• What is the role of the information system’s function in a business?
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Business: Formal organization that makes products or provides a service in order to make a profit
Four basic business functions• Manufacturing and production
• Sales and marketing
• Finance and accounting
• Human resources
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• Five basic business entities: • Suppliers
• Customers
• Employees
• Invoices/payments
• Products and services
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• Logically related set of tasks that define how specific business tasks are performed
• The tasks each employee performs, in what order, and on what schedule
• E.g. Steps in hiring an employee
• Some processes tied to functional area• Sales and marketing: Identifying customers
• Some processes arre cross-functional• Fulfilling customer order
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Firms coordinate work of employees by developing hierarchy in which authority is concentrated at top◦ Senior management
◦ Middle management
◦ Operational management
◦ Knowledge workers
◦ Data workers
◦ Production or service workers Each group has different needs for information
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Global environment Global environment factorsfactors
• Technology and Technology and sciencescience
• EconomyEconomy
• PoliticsPolitics
• International changeInternational change
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Immediate Immediate environment factorsenvironment factors
• CustomersCustomers
• SuppliersSuppliers
• Competitors Competitors
• RegulationsRegulations
• StockholdersStockholders
• Firms invest in information systems in order to: • Achieve operational excellence• Develop new products and services• Attain customer intimacy and service• Improve decision making• Promote competitive advantage• Ensure survival
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• Sales and marketing systems
• Manufacturing and production systems
• Finance and accounting systems
• Human resources systems
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• Sales and marketing systems • Support activities for selling and marketing firm’s products or services• Senior management:
• Monitor trends affecting products and sales, planning for new products and services, monitor performance of competitors
• Middle management: • Support market research, analyze marketing campaigns, pricing decisions, sales
performance• Operational management and employees:
• Locating and contacting prospective customers, process orders, provide customer service support
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• Manufacturing and production systems • Support activities for producing firm’s products or services• Senior management:
• Help plan long-term manufacturing goals, such as technology investments and locating new plants
• Middle management: • Analyze and monitor manufacturing and production costs and resources
• Operational management • Manage status of production tasks
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• Finance and accounting systems • Support activities for managing financial assets, firm’s capitalization, and financial
records• Senior management:
• Establish long-term investment goals and provide long-range forecasts of firm’s financial performance
• Middle management: • Oversee and control firm’s financial resources
• Operational management • Track flow of funds in firm through transactions (paychecks, payments, securities
reports, receipts, etc.)
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• Human resources systems • Support activities for attracting, developing, and maintaining firm’s workforce• Senior management:
• Identify manpower requirements (skill, education level, types and numbers of positions, etc.) for meeting long-term business plans
• Middle management: • Monitor and analyze recruitment, allocation, and compensation of employees
• Operational management • Track recruitment and placement of employees
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• Transaction processing systems• Keep track of basic activities and transactions of organization (e.g. sales,
receipts, cash deposits, payroll, credit decisions, flow of materials in a factory))
• Management information systems and decision-support systems
• Help with monitoring, controlling, decision-making, and administrative activities
• Executive support systems::• Help address strategic issues and long-term trends, both in firm and in
external environment
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• Transaction processing systems • Serve operational managers
• Principal purpose is to answer routine questions and to track the flow of transactions through the organization
• E.g. Inventory questions, granting credit to customer
• Monitor status of internal operations and firm’s relationship with external environment
• Major producers of information for other systems
• Highly central to business operations and functioning
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• Management information systems • Provide middle managers with reports on firm’s performance
• To monitor firm and help predict future performance
• Summarize and report on basic operations using data from TPS
• Provide weekly, monthly, annual results, but may enable drilling down into daily or hourly data
• Typically not very flexible systems with little analytic capability
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• Decision support systems (DSS)• Support non-routine decision making for middle management
• E.g. What would impact on production schedules be if sales doubled in December?
• Use information from TPS, MIS, and external sources
• Use models to analyze data
• E.g. voyage estimating system of metals company that calculates financial and technical voyage details
• Focus on extracting, analyzing information from large amounts of data
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• Executive support systems (ESS)• Serve senior managers
• Address strategic issues and long-term trends
• E.g. What products should we make in 5 years?
• Address non-routine decision-making
• Provide generalized computing capacity that can be applied to changing array of problems
• Draw summarized information from MIS, DSS and data from external events
• Typically use portal with Web interface to present content
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• TPS: Major source of data for other systems
• ESS: Primarily a recipient of data from lower-level systems
• Other systems may exchange data as well
• Exchange of data between functional areas
• E.g. Sales order transmitted to manufacturing system
• In most organizations, systems are loosely integrated
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• Integrate data from key business processes into single system
• Speed communication of information throughout firm• Enable greater flexibility in responding to customer
requests, greater accuracy in order fulfillment• Enable managers of large firms to assemble overall
view of operations
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• Manage relationships with suppliers, purchasing firms, distributors, and logistics companies
• Manage shared information about orders, production, inventory levels, etc.
• Goal is to move correct amount of product from source to point of consumption as quickly as possible and at lowest cost
• Type of inter-organizational system: • Automating flow of information across organizational boundaries
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• Help manage relationship with customers• Coordinate business processes that deal with customers
to optimize revenue and customer satisfaction, and increase sales
• Combine sales, marketing, and service record data from multiple communication channels to provide unified view of customer, eliminate duplicate efforts
• E.g. Saab CRM applications to achieve 360º view of customers resulted in greater follow-up rate on sales leads and increased customer satisfaction
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• Intangible knowledge assets• Knowledge about producing and delivering products• Source of value and advantage for firms
• Knowledge management systems: • Help capture, storage, distribute, and apply knowledge so that it can be
leveraged for strategic benefit• Include systems for:
• Managing and distributing documents, graphics, other digital knowledge objects
• Creating knowledge directories of employees with specialized expertise• Distributing knowledge
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• E-business• Use of digital technology and Internet to drive major business processes
• E-commerce• Subset of e-business
• Buying and selling goods and services through Internet
• E-government:• Using Internet technology to deliver information and services to
citizens, employees, and businesses
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4 Business Functions and Systems 5 Business Entities Support Systems (TSS, MIS, DSS, ESS) Management Systems (SCM, CRM, KMS)
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