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INFORMATION SYSTEMS IN THE ORGANIZATION

INFORMATION SYSTEMS IN THE ORGANIZATION. OBJECTIVES. What are the major types of systems in a business? What roles do they play? Why should managers pay attention to business processes? Why do firms need to integrate their business processes?

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INFORMATION SYSTEMS IN THE ORGANIZATION

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  1. INFORMATION SYSTEMS IN THE ORGANIZATION

  2. OBJECTIVES • What are the major types of systems in a business? What roles do they play? • Why should managers pay attention to business processes? Why do firms need to integrate their business processes? • What are the benefits and challenges of using enterprise systems? continued

  3. OBJECTIVES (continued) • What are the benefits of using systems to support supply chain management and collaborative commerce? • What are the benefits of using information systems for customer relationship management and knowledge management?

  4. FAST-TRACK FASHIONS AT ZARA

  5. MANAGEMENT CHALLENGES • Integration:Different systems serve variety of functions, connecting organizational levels difficult, costly • Enlarging Scope of Management Thinking:Huge system investments, long development time must be guided by common objectives

  6. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS

  7. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Different Kinds of Systems • Operational-Level Systems • Monitor the elementary activities and transactions of the organization • Knowledge-Level Systems • Support knowledge and data workers • continued

  8. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Different Kinds of Systems (continued) • Management-Level Systems • Support the monitoring, control, decision-making, and administrative activities of middle managers • Strategic-Level Systems • Support the long-range planning of senior management

  9. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems • Transaction Processing Systems (TPS) • Knowledge Work Systems (KWS) • Office Systems • Management Information Systems (MIS) • Decision Support Systems (DSS) • Executive Support Systems (ESS)

  10. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS

  11. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems

  12. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems • Transaction Processing Systems (TPS): • Computerized systems that perform and record the daily routine transactions necessary to conduct business • Serve the operational level

  13. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems

  14. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems

  15. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems • Knowledge Work Systems (KWS): • Information systems that aid knowledge workers in the creation and integration of new knowledge in the organization • Office Systems: • Computer systems, such as word processing, e-mail, and scheduling systems that are designed to increase the productivity of data workers in the office

  16. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems Knowledge Work Systems (KWS): Knowledge Level • Inputs:Design specs • Processing:Modeling • Outputs:Designs, graphics • Users:Technical staff and professionals Example: Engineering work station

  17. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems Management Information System (MIS): Management Level • Inputs: High-volume data • Processing: Simple models • Outputs: Summary reports • Users: Middle managers Example: Annual budgeting

  18. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems Management Information System: • Structured and semi-structured decisions • Report control oriented • Past and present data • Internal orientation • Lengthy design process

  19. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems

  20. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems

  21. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems Decision Support System (DSS):combines data and analytical models or data analysis tools to support semi-structured and unstructured decision-making Management level • Inputs: Low-volume data • Processing: Interactive • Outputs: Decision analysis • Users: Professionals, staff Example: Contract cost analysis

  22. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems

  23. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems Executive Support System (ESS): Strategic level • Inputs: Aggregate data • Processing: Interactive • Outputs: Projections • Users: Senior managers Example: 5-year operating plan

  24. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems Executive Support Systems • Top level management • Designed to the individual • Ties CEO to all levels • Very expensive to keep up • Extensive support staff

  25. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Six Major Types of Systems

  26. 2.1 MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS Relationship of Systems to One Another

  27. 2.2 ENTERPRISE APPLICATIONS Enterprise Applications • Systems that can coordinate activities, decisions, and knowledge across many different functions, levels and business units • Includes enterprise systems, supply chain management systems, customer relationship management systems and knowledge management systems

  28. 2.2 ENTERPRISE APPLICATIONS Integrating Functions and Business Processes 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—sets of activities

  29. 2.2 ENTERPRISE APPLICATIONS Integrating Functions and Business Processes

  30. ENTERPRISE APPLICATIONS Examples of Business Processes • Manufacturing and Production: Assembling product, checking quality, producing bills of materials • Sales and Marketing: Identifying customers, creating customer awareness, selling

  31. ENTERPRISE APPLICATIONS Examples of Business Processes • Finance and Accounting: Paying creditors, creating financial statements, managing cash accounts • Human Resources: Hiring employees, evaluating performance, enrolling employees in benefits plans

  32. 2.2 ENTERPRISE APPLICATIONS Integrating Functions and Business Processes Cross-Functional Business Processes • Transcend boundary between sales, marketing, manufacturing, and research and development • Group employees from different functional specialties to complete a piece of work Example: Order Fulfillment Process

  33. 2.2 ENTERPRISE APPLICATIONS Integrating Functions and Business Processes

  34. 2.2 ENTERPRISE APPLICATIONS Enterprise Systems Enterprise Systems • Provide a technology platform where organizations can integrate and coordinate major business processes • Also known as Enterprise Resource Planning Systems (ERP)

  35. 2.2 ENTERPRISE APPLICATIONS Enterprise Systems Traditional View of Systems • Within the business: There are functions, each having its uses of information systems • Outside the organization’s boundaries:There are customers and vendors Functions tend to work in isolation

  36. 2.2 ENTERPRISE APPLICATIONS Enterprise Systems

  37. 2.2 ENTERPRISE APPLICATIONS Enterprise Systems

  38. 2.2 ENTERPRISE APPLICATIONS Enterprise Systems

  39. 2.2 ENTERPRISE APPLICATIONS Benefits and Challenges of Enterprise Systems • Benefits • Firm structure • Integrated corporation • Management • Firm-wide knowledge-based management processes • Technology: • Unified platform • Business: • More efficient operations and customer-driven business processes

  40. 2.2 ENTERPRISE APPLICATIONS Benefits and Challenges of Enterprise Systems • Challenges • Difficult & costly to build • Complex technology • Need to rework business processes • Centralized organizational coordination and decision making may not be suitable for all organizations • Difficult to attain strategic differentiation

  41. 2.2 ENTERPRISE APPLICATIONS Supply Chain Management and Collaborative Commerce 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

  42. 2.2 ENTERPRISE APPLICATIONS Supply Chain Management and Collaborative Commerce Supply Chain • Network of organizations and business processes • Helps in procurement of materials, transformation of raw materials into intermediate and finished products, and distributing final products to customers Reverse Logistics • The return of items from buyers to sellers in a supply chain

  43. 2.2 ENTERPRISE APPLICATIONS Supply Chain Management and Collaborative Commerce

  44. 2.2 ENTERPRISE APPLICATIONS Supply Chain Management and Collaborative Commerce Limitations: • Inefficiencies can waste as much as 25% of a company’s operating costs • Bullwhip Effect: Information about the demand for the product gets distorted as it passes from one entity to next

  45. 2.2 ENTERPRISE APPLICATIONS Supply Chain Management and Collaborative Commerce

  46. 2.2 ENTERPRISE APPLICATIONS Supply Chain Management and Collaborative Commerce • Supply Chain Planning System:Enables firm to generate forecasts for a product and to develop sourcing and a manufacturing plan for the product • Supply Chain Execution System:Manages flow of products through distribution centers and warehouses

  47. 2.2 ENTERPRISE APPLICATIONS Supply Chain Management and Collaborative Commerce

  48. 2.2 ENTERPRISE APPLICATIONS Collaborative Commerce • Uses digital technologies to enable multiple organizations to collaboratively design, develop, build, move, and manage products • Increases efficiencies in reducing product design life cycles, minimizing excess inventory, forecasting demand, and keeping partners and customers informed

  49. 2.2 ENTERPRISE APPLICATIONS Collaborative Commerce • Collaborative Planning, Forecasting, and Replenishment (CPFR) • Collaboration of firms with their suppliers and buyers to: • Formulate demand forecasts • Develop production plans • Coordinate shipping, warehousing and stocking activities

  50. 2.2 ENTERPRISE APPLICATIONS Collaborative Commerce

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