Front- and Back-Office Information Systems

1. An information system (IS) is an arrangement of people, data, processes, communications, and information technology that interact to support and improve day-to-day operations in a business as well as support the problem-solving and decision making needs of management and users. Information technology is a contemporary term that describes the combination of computer technology (hardware and software) with telecommunications technology (data, image, and voice networks).

2. Front- and Back-Office Information Systems Front-officeinformation systems support business functions that reach out to customers (or constituents). Marketing Sales Customer management Back-officeinformation systems support internal business operations and interact with suppliers (of materials, equipment, supplies, and services). Human resources Financial management Manufacturing Inventory control

3. Information System Resources People Resources End Users – the people who use an information system or the information it produces. Ex: Accountants, salespeople, customers IS Specialists – the people who develop and operate information systems based on the requirements of end users. Ex: programmers, analysts, system operators

4. Information System Resources Hardware Resources Machines, such as computers and other devices, and media, such as paper, disks Computer Systems such as the personal computer (desktop), mainframe, or laptop Computer peripherals such as keyboard, mouse, monitor, scanner, printer, disks

5. Information System Resources Software Resources Programs – sets of operating instructions that direct and control computer hardware Procedures – sets of information processing instructions that people need

6. Information System Resources Software Resources continued System Software – such as operating system that supports the operations of a computer system. Ex. Windows 98 Application Software – programs that direct processing for a particular use of computers by end users. Ex. Excel Procedures – operating instructions for people who will use an IS. Ex. Instructions for filling out a form.

7. Systems: Some Examples University Inputs: Students, Faculty, Textbooks Processes: Education/Courses Output: graduates Feedback: surveys, grades Toyota Plant Inputs: raw materials, components Processes: assembly line Output: mini-vans Feedback: customer surveys, quality reports Fast Food IS Inputs: consumer orders Processes: processing software Output: receipts, cook’s order list Feedback: invalid entry message Video Store IS Inputs: rentals, returns Processes: processing software Output: reports, rental agreement Feedback: error repots

8. Information & Decision Making - External Imprecise Recurring Information Needs Strategic Increasing Scope Increasing Detail DSS Tactical MIS Operational + Internal Precise Operational Activity Raw Data EIS TPS

9. Strategic Planning Decisions Decide Organisations Objectives – top down management Plan how to achieve Objectives 1. Long term 2. High levels of Uncertainty and Risk 3. Situations may not be recurring 4. Deals with complex issues Strategic Summarised Information Operational Operational Activity Raw Data Environmental Information Tactical

10. Management Control Decisions Taken within the framework of strategic plans Ensure that resources are obtained and used efficiently and effectively Decisions encompass planning activities e.g. pricing a new product Strategic Summarised Information Operational Operational Activity Raw Data Some Environmental Information Tactical

11. Operations, Tactics, Strategy

12. Decision Levels

13. History of the Role of IS 1970-1980 1950-1960 1960-1970 1980-1990 1990-2000 Strategic & End User Management Reporting Data Processing Electronic Commerce Decision Support Electronic Data Processing - TPS Management Information Systems Decision Support Systems - Ad hoc Reports End User Computing Exec Info Sys Expert Systems SIS Electronic Business & Commerce -Internetworked E-Business & Commerce

14. Operational-level Systems Transaction-Processing Systems (TPS) Basic business systems Perform daily routine transactions necessary for business functions At the operational level, tasks, resources and goals are predefines and highly structured Generally, five functional categories are identified, as shown in the diagram.

16. System Architecture: Transaction Processing System

17. System Example: Payroll System (TPS)

18. What is MIS? A Management Information System (MIS) is an organized method of providing past, present and projection information relating to internal operations and external intelligence. It supports the planning, control and operational functions of an organization by furnishing uniform information in the proper time-frame to assist the decision-maker ["MIS Universe", Data Management, Sept 1970] A Management Information System provides managers with information and support for effective decision making and provides feedback on daily operations.

19. Management-level Systems Management Information Systems (MIS) MIS provide managers with reports and, in some cases, on-line access to the organisations current performance and historical records Typically these systems focus entirely on internal events, providing the information for short-term planning and decision making. MIS summarise and report on the basic operations of the organisation, dependent on the underlying TPS for their data.

21. System Description: Management Information Systems • MISs are used by managerial employees to support recurring decision making in managing a function or the entire business • Supported Activities • Scheduled Reporting - the system produces automatically based on a predetermined schedule. Some include: • Key Indicator – High-level summaries to monitor performance (e.g. Monthly Sales Report) • Exception – Highlights situations where data is out of normal range (e.g. Monthly Late Shipments) • Drill Down – Provides lower level detail aggregated in a summary report (printed only if needed) • Ad Hoc Reporting – unscheduled reports that are usually custom built to answer a specific question (e.g. sales data by person report to identify issues)

22. Scheduled Report Example

23. Key Indicator Report Example

24. Demand Report Example

25. Exception Report Example

26. Outputs of a Management Information System Drill Down Reports Provide detailed data about a situation.

27. Management Information System (MIS) Inputs: Summary transaction data Processing: Simple models; low level analysis Outputs: Summary reports Users: Middle managers Example: Weekly, monthly, and annual resource allocation. Not five year plans and not daily details, but something in between. 27

28. System Architecture: Management Information System 28

29. Guidelines for Developing MIS reports 29

30. System Description: Functional Area Info Systems • Functional Area Information Systems • Cross-organizational information systems are designed to support a specific functional area • Supported Activities • The following functional organizations have systems to support their operational and managerial activities • Accounting • Finance • Human Resources • Marketing • Operations

32. Overview of a Marketing MIS

33. Overview of a Financial MIS

34. Manufacturing MIS Material requirements planning (MRP) Manufacturing resource planning (MRPII) Just in time (JIT) inventory system

35. Overview of a Manufacturing MIS

36. Human Resource MIS Concerned with activities related to employees and potential employees of the organization. Subsystems include: needs and planning assessments recruiting training and skills development scheduling and assignment employee benefits

37. Overview of a Human Resource MIS

38. Information Systems in Industry Airline industry (e.g., ticketing sites) Investment firms (e.g., analyze stocks and bonds) Banks (e.g., online check payment) Transportation industry (e.g., schedule trucks and trains)

39. Information Systems in Industry Healthcare organizations (e.g., track patient records) Retail companies (e.g., process customer orders) Power management and utility companies (e.g., monitor and control power generation and usage) Professional services (e.g., provide information on products and services to its consultants)