Management Information Systems - Class Note # 2

1. Management Information Systems - Class Note # 2 Prof. Yuan-Shyi Peter Chiu Feb. 2012

2. Chap 2 Information Systems in the Enterprise 2.1 Key System Applications in the Organization 2.2 Systems from a Functional Perspective 2.3 Integrating Functions and Business Processes 2.4 International Information Systems

3. Fig 2.1: Types of Information Systems

4. 2.1 Different kinds of systems  Operational-level systems • Information systems thatmonitor the elementary activities and transactionsof the organization . • Information systems thatsupport knowledge and data workersin an organization. 1 / 2  Knowledge-level systems

5. 2.1 Different kinds of systems  Management-level systems • Information systems that support the monitoring, controlling, decision making, and administrative activities of middle managers. Information systems that support the long-range planning activities of senior management . 2 / 2 Strategic-level systems

6. Major Types of Systems • Executive Support Systems (ESS) • Decision Support Systems (DSS) • Management Information Systems (MIS) • Knowledge Work Systems (KWS) • Office Automation Systems (OAS) • Transaction Processing Systems (TPS)

7. Fig 2-2: The six major types of information systems.

8. 2.1 Six Major Types of Systems  TPS – Transaction Processing Systems Computerized systems that perform and record thedaily routine transactions necessary to conduct the business; they serve the organization’s operational level.

9. Fig 2-4: Typical applications of TPS ■

10. TYPICAL TPS APPLICATIONSSales & Marketing Systems MAJOR FUNCTIONS OF SYSTEMS:  Sales Management ;  Market Research ;  Promotion ; Pricing ; New Products  MAJOR APPLICATION SYSTEMS:  Sales Order Info System ;  Market Research System ;  Pricing System See Fig. 2-4 ( p.43 )

11. 2.1 TPS – Transaction Processing Systems Manufacturing  Plant scheduling  Material movement control  Machine control Finance Securities trading Cash management

12. 2.1 TPS – Transaction Processing Systems Accounting Payroll Account payable Account receivable Human Resources  Compensation Training & development Employee record keeping

13. 2.1 Payroll TPS Fig 2-3: A symbolic representation for a payroll TPS. ◆

14. 2.1 Six Major Types of Systems  KWS – knowledge work systems Information systems that aid knowledge workers in the creation and integration of new knowledge in the organization . Example: Engineering work station

15. 2.1 Six Major Types of Systems  OAS – office automation systems Computer systems, such as word processing, electronic mail systems, and scheduling systems, that are designed to increase the productivity of data workers in the office .

16. 2.1 Six Major Types of Systems  MIS – Management Information Systems Information systems at the management level of organization that serve the functions of planning, controlling, and decision makingby providing routine summary and exceptionreports. Example: Annual budgeting

17. 2.1 MIS • Structured and semi-structured decisions • Report control oriented • Past and present data • Internal orientation

18. TPS DATA FOR MIS APPLICATIONS Fig 2-5: How management information systems obtain their data the from the organization’s TPS .

19. 2.1 Six Major Types of Systems  DSS – Decision Support Systems Information systems at the management level of an organization that combine data and sophisticated analytical modelsto support non-routine decision making. Example:Contract cost analysis

20. Decision Support System (DSS) Fig 2-7: Voyage estimating decision-support system . ◆

21. 2.1 MIS & DSS  Sales and marketing  Sales management  Sales region analysis • Manufacturing  Inventory control  Production scheduling

22. 2.1 MIS & DSS Finance  Annual budgeting  Cost analysis Accounting  Capital investment analysis  Pricing / profitability analysis Human Resource  Relocation analysis  Contract cost analysis

23. 2.1 Six Major Types of Systems  ESS – Executive Support Systems Information system at the organization’s strategic level designed to address unstructured decision making through advanced graphicsand communications. Example: 5-year operating plan

24. 2.1 ESS • Top level management • Designed to the individual • Ties CEO to all levels • Very expensive to keep up • Extensive support staff

25. Figure 2-8 Executive Support System (ESS) Fig 2-8: Model of a typical executive support system .

26. 2.1 ESS Sales and marketing Sales trend forecasting Manufacturing Operating plan Finance Budget forecasting Accounting Profit planning Human Resource Personnel planning

27. 2.1 Characteristics of Different Types of Information Systems  Information inputs  Processing Information outputs  Users See Table 2-1 ( p.41 )

28. 2.2 Systems from a Functional Perspective Fig 2-9: Interrelationships among systems

29. 2.2 Systems from a Functional Perspective  SALES & MARKETING SYSTEMS  MANUFACTURING & PRODUCTION SYSTEMS  FINANCE & ACCOUNTING SYSTEMS  HUMAN RESOURCES SYSTEMS

30. 2.2 Systems from a Functional Perspective Sales and Marketing Systems Major functions of systems: • Sales management, market research, promotion, pricing, new products Major application systems: • Sales order info system, market research system, pricing system

31. Sales and Marketing Systems

32. 2.2 Systems from a Functional Perspective Manufacturing and Production Systems Major functions of systems: • Scheduling, purchasing, shipping, receiving, engineering, operations Major application systems: • Materials resource planning systems, purchase order control systems, engineering systems, quality control systems

33. Manufacturing and Production Systems

34. 2.2 Systems from a Functional Perspective Financing and Accounting Systems Major functions of systems: • Budgeting, general ledger, billing, cost accounting Major application systems: • General ledger, accounts receivable, accounts payable, budgeting, funds management systems

35. Financing and Accounting Systems

36. 2.2 Systems from a Functional Perspective Human Resource Systems Major functions of systems: • Personnel records, benefits, compensation, labor relations, training Major application systems: • Payroll, employee records, benefit systems, career path systems, personnel training systems

37. Human Resource Systems

38. 2.3 Business Processes and Information Systems 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 • Unique ways to coordinate work, information, and knowledge • Ways in which management chooses to coordinate work

39. 2.3 Business Processes and Information Systems Examples of Business Processes • Manufacturing and production: Assembling product, checking quality, producing bills of materials • Sales and marketing: Identifying customers, creating customer awareness, selling

40. 2.3 Business Processes and Information Systems Cross-Functional Business Processes Fig. 2-12 The Order Fulfillment Process

41. 2.3 Business Processes and Information Systems Information systems help organizations • Achieve great efficiencies by automating parts of processes • Rethink and streamline processes

42. 2.3 Business Processes and Information Systems Customer Relationship Management (CRM) • Manages all ways used by firms to deal with existing and potential new customers • Uses information system to coordinate entire business processes of a firm • Provides end-to-end customer care • Provides a unified view of customer across the company • Consolidates customer data from multiple sources and provides analytical tools for answering questions

43. Figure 2-13 2.3 Business Processes and Information Systems Customer Relationship Management (CRM)

44. 2.3 Business Processes and Information Systems • 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 • Network of organizations and business processes • Helps in procurement of materials, transformation of raw materials into finished products • Helps in distribution of the finished products to customers • Includes reverse logistics- returned items flow in the reverse direction from the buyer back to the seller

45. 2.3 Business Processes and Information Systems Supply Chain Management Figure 2-14

46. 2.3 How Information Systems Facilitate Supply Chain Management • Decide when, what to produce, store, move • Rapidly communicate orders • Communicate orders, track order status • Check inventory availability, monitor levels • Track shipments • Plan production based on actual demand • Rapidly communicate product design change • Provide product specifications • Share information about defect rates, returns

47. 2.3 Collaborative Commerce Figure 2-15

48. Figure 2-17 2.3 Enterprise System

49. 2.4 Global System Configuration Figure 2-18

50. HOMEWORK Chap.2 # 1 # 2 # 3 # 7 # 8 # 9 # 10: What is CRM? # 11: What is SCM? # 12 ~ THE END ~