types of information systems in an organisation

8/11/2019 Types of Information Systems in an Organisation

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Stable, Formal, Social Structure that

takes the resources from the

environment, process them to

produce the output.

Formal legal entities with internalrules and procedures

A formal and coordinated group of

people who function to achieve

particular goals

Collection of rights, privileges,obligations and responsibilities.


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StructureHierarchyDivision of labor

Rules, proceduresBusiness processesCulture

ProcessRights/obligationsPrivileges/valuesResponsibilitiesNormsPeople

Environmentalresources Environmental

Outputs


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Organization

Two or more people who work together in a structured way to

achieve a specific goal or set of goals.

Goals

Purpose that an organization strives to achieve; organizations often

have more than one goals, goals are fundamental elements of

organization.

The Role of Management

To guide the organizations towards goal accomplishment


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Managementrefers to the

tasks and activities involved in

directing an organization or

one of its units: planning,

organizing, leading, and

controlling.

The process of reaching

organizational goals by

working with and throughpeople and other

organizational resources.


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Organizing

Planning

Controlling

Leading


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Top

Manage-ment

Middle

Management

Supervisory oroperational management

Conceptual skills

Human skills

Needs

Needs Technical Skills

Needs

Management levels Skills needed


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Monitor elementary activities and daily transactions

of the organization

support the monitoring, controlling, decision-making and administrative activities ofmiddle managers

support the long-range planning activities ofsenior management

Operational-levelsystem

Management-levelsystem

Strategic-levelsystem

Different Kinds of Systems


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Four major Types of systems1.) Executive support system

5 yrs sales trend forecasting, operational plan, budgets

forecasting, profit planning, personnel planning

2.) Management Information SystemSales management , inventory control, annual budgeting,

capital investment analysis, relocation analysis

3.) Decision support system

Sales region analysis, Production Scheduling, cost

analysis, pricing/profitability analysis, contract cost analysis.4.) Transaction Processing System

Order tracking/processing, plant scheduling, material movement, pay roll,account payable/receiveable, training & development, employee record


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Transactions Basic business

operations such ascustomer orders,purchase orders,receipts, time cards,invoices, and payrollchecks in anorganization


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Transaction processing system (TPS)

A computerized system that keeps the daily

records of routine transactions like sales order,employee record keeping, customer orders,purchase orders, receipts, time cards, invoices,

and payroll checks.

An organized collection of people, procedures,

software, databases, and devices used to record

completed for business related exchanges


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Process data generated by and about transactions

Maintain a high degree of accuracy

Ensure data and information integrity and accuracy Produce timely documents and reports

Increase labor efficiency

Help provide increased and enhanced service

Help build and maintain customer loyalty

Achieve competitive advantage


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Data entry & input

ProcessingDocuments& reports

Database

Internally generatedtransactions:

shipped orders

purchase orders

employee time cards

Externally generatedtransactions:

customer orders

vendor invoices

customer payments

Database update:

customer orders

inventory

purchase orders

customers

suppliers

Documents:

pick list

cheques to vendors

receiving notices pay cheques

Operational reports:

finished product inventorystatus

raw materials; packing

materials; spare parts;inventory status


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Output

Terminal

Terminal

Terminal

Terminal

Terminal

Immediate

processingof eachtransaction


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Raw materialsPacking materialsSpare partsInventory control

Purchase orderprocessing

Receiving

Accountspayable

Employees

Supplier

Inventory control

status report

Purchaseorder

Material

Cheque

Invoice

Receivingnotice

Purchaseorder

Purchaseorder

request


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Inventory control Maintains stock of items such as raw materials, packing

materials, spare parts, and supplies

Purchase order (P.O.) processing

A system that helps purchasing department completetransactions quickly and efficiently

Receiving A system that creates a record of expected and actual receipts Reconciles purchase orders with what is actually received

Accounts payable A system that increases an organizations control over

purchasing, improves cash flow increases profitability, and provides more effective

management of current liabilities


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Accounting systems

Consist of

Budget

Accounts receivable

Accounts payable

Payroll

Asset management

General ledger


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Payroll Generates payroll checks , as well as W-2 statements at the end

of the year for tax purposes


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Payrollsystem

EmployeeDatabase

To General ledger

Management Report

Outline queries

Employee numberNameAddPay rateMedicalTaxGross payNet pay

Government Agencies

Employee pay cheque


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Management information system (MIS)

An MIS provides managers with information andsupport for effective decision making, and provides

feedback on daily operations

Output, or reports, are usually generated throughaccumulation of transaction processing data

Each MIS is an integrated collection of subsystems,which are typically organized along functional lineswithin an organization


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Common

databases

Marketing

management

information

system

Financial

management

Information

system

Manufacturing

management

Information

system

Order

managementinformation

system

TPS


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Scheduled reports Produced periodically, or on a schedule (daily, weekly, monthly)

Key-indicator report Summarizes the previous days critical activities

Typically available at the beginning of each day

Demand report Gives certain information at a managers request

Exception report Automatically produced when a situation is unusual or requires

management action

Drill Down Report: Gives you the detailed report.


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Daily Sales Detail Report

Prepared: 08/10/xx

Order#

CustomerID

SalesRep ID

ShipDate Quantity Item # Amount

P12453 C89321 CAR 08/12/96 144 P1234 $3,214

P12453 C89321 CAR 08/12/96 288 P3214 $5,660

P12453 C03214 GWA 08/13/96 12 P4902 $1,224

P12455 C52313 SAK 08/12/96 24 P4012 $2,448

P12456 C34123 JMW 08J/13/96 144 P3214 $720


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Daily Sales Key Indicator Report

ThisMonth

LastMonth

LastYear

Total Orders Month to Date $1,808 $1,694 $1,014

Forecasted Sales for the Month $2,406 $2,224 $2,608


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Daily Sales by Sales Rep Summary Report

Prepared: 08/10/xx

Sales Rep ID Amount

CAR $42,345

GWA $38,950

SAK $22,100

JWN $12,350


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Earnings by Quarter (Millions)

Actual Forecast Variance

2NDQtr 1999 $12.6 $11.8 6.8%

1stQtr 1999 $10.8 $10.7 0.9%

4thQtr 1998 $14.3 $14.5 -1.4%

3rd

Qtr 1998 $12.8 $13.3 -3.0%

Drill DownReportsProvide detaileddata about a

situation.


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Provides reports with fixed and standardformats

Hard-copy and soft-copy reports Uses internal data stored in the computer

system End users can develop custom reports Requires formal requests from users


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Data may be made available frommanagement information systems on a

companys intranet Employees can use browsers and their PC to

gain access to the data


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MIS is an integrated collection of functionalinformation systems, each supporting

particular functional areas.


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Provides financial information to all financialmanagers within an organization.


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Financial statements

Uses and managementof funds

Financial statisticsfor control

Operationaldatabases

Databasesof valid

transactionsfor each

TPS

Transactionprocessingsystems

Businesstransactions


Internetor

Extranet

FinancialMIS


Databases ofexternal data

Databases ofinternal data

FinancialDSS

FinancialES

Financialapplications

databases

Customers,Suppliers


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Quality control reports

Process control reports

JIT reportsOperationaldatabases

Databases

of validtransactions

for eachTPS

Transaction

processingsystems



Internetor

Extranet

ManufacturingMIS


Databases ofexternal data

Databases of

internal data

Manufacturing

DSS

ManufacturingES

Manufacturingapplicationsdatabases

Customers,Suppliers

MRP reports

Production schedule

CAD output


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Strategic plan or corporate policies. The TPS:

Order processing Inventory data

Receiving and inspecting data

Personnel data

Production process External sources


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Design and engineering

Master production scheduling

Inventory control

Manufacturing resource planning Just-in-time inventory and manufacturing Process control

Computer-integrated manufacturing (CIM)

Quality control and testing


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Supports managerial activities in productdevelopment, distribution, pricing decisions,

and promotional effectiveness


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Strategic plan and corporate policies The TPS External sources:

The competition

The market


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Marketing research Product development Promotion and advertising Product pricing


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Concerned with all of the activities related toemployees and potential employees of the

organization


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Human resource planning Personnel selection and recruiting Training and skills inventory Scheduling and job placement Wage and salary administration


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Geographic information systems (GISs)

Enables managers to pair pre-drawn maps or

map outlines with tabular data to describe

aspects of a particular geographic region.


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Decision Support SystemAn organized collection of people, procedures, software,databases, and devices used to support problem-specific

decision making.

Provide interactive ad hoc support for decision makingprocesses to the manager.

Perform what-if-analysis as a part of decision.

A DSS helps a manger do the right thing


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Companies migrates towards e-business,they are investing new data driven decision

support applications framework to help them1. Respond rapidly to changing marketcondition

2. Customer need


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How are decisions made???

What methodologies can be applied?

What is the role of information systems

in supporting decision making?

DSSDecis ion

Suppor t

Systems


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Type of the information required depends on levels of managementdecision making and structure of decision situation they face

Strategic mgt

Executives & Directors

Tactical mgtManagers & self Directed team

Operational mgtManagers & self Directed team

Decision Structure Information Characteristics

Unstructured

Semi-structured

Structured


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Decision: a reasoned choice among alternativesExamples:

Where to advertise a new product

What stock to buy What movie to see Where to go for dinner

Decision Making: a process of choosing among

alternative courses of action for the purpose ofattaining a goal or goals


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Structured Problems

Routine and repetitive with standard solution

Well defined decision making procedure

Given a well-defined set of input, a well defined set of output isdefined

Semi-structured Problems

Has some structured aspect

Some of the inputs or outputs or procedures are not well defined Unstructured Problems

All phases of decision making process are unstructured

Not well defined input, output set and procedures


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Operational Planning and Control:

Focus on efficient and effective execution of specific tasks.

They affect activities taking place right now

E.g... What should be today's production level Management Control and Tactical Planning

Focus on effective utilization of resources

more longer range planning horizon

E.g... What is next years production level

Strategic Planning Long-range goals and policies for resource allocation

E.g... What new products should be offered


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Systematic Decision-Making Process

Intelligence

Design

Choice

Implementation


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Collects, processes, stores, analyzes, and

disseminates information for a specific

purpose

Is often at the heartof many organizations

Accepts inputs and processes data to provide

information to decision makers and helps

decision makers communicate their results


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Effectiveness is the degree to which goals are

achievedDoing the r igh t th ing!

Efficiency is a measure of the use of inputs (orresources) to achieve outputsDoing the th ing r ight!

Productivity (eff ic iency/effect iveness)

Measurable?

several non-quantifiable, conflicting goals


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Characteristics Operational Managerial Strategic

Accuracy High Low

Level of detail Detailed Aggregate

Time horizon Present Future

Use Frequent Infrequent

Source Internal External

Scope Narrow WideNature Quantitative Qualitative

Age Current Current/old