We can define it as : “An information system is
a system for
collection, adaptation, storage, transfer and
presentation of information , for the users of
the information system, in an effective way.
The information system can be totally or party
computerized.” Logistics is “the process of
IMPORTANCE OF THE LOGISTICS
Logistics information systems are important for achieving logistics
efficiency and effectiveness. In an enterprise, logistics information
system seeks to achieve the following:
It ensures of logistics functional operations into a process pursuing
customer satisfaction at the lowest total cost.
Information system facilitates planning and control of the logistical
activities related to order fulfillment.
It makes the firm more competitive, by making better tactical and
strategic decision for the benefits of the firm and its customer.
Helps provide customers information regarding product
availability, order status, and delivery schedules promoting customers
It reduces the requirements of inventory and human resources by
enabling requirements planning.
It interfaces with marketing, financial, and manufacturing information
systems and provides information to top management to help
formulate strategic decisions for the whole firm.
The use information technology in information systems has enabled
quick response to demand making forecasting redundant. This has
also helped in implementing “pull” systems like just-in-time making
the firm more competitive.
It promotes systems that link the operations of the firm, such as
manufacturing and distributing, with the suppliers operations on the
one hand the customer on the other.
FUNCTION OF THE INFORMATION SYSTEMS
An information system uses informative key figures to aid the rapid
detection of existing problem areas and analyze their origin.
The information systems in logistics are flexible tools for
collecting, aggregating and analyzing data from the operative
applications They thus enable you to continually control target criteria
and to react in time to exceptional situations.
The function of the information systems is to allow you to view the
information from your operative applications from any perspective you
wish. You are free to define the level of detail in which the information
In the Logistics Information System, data can be analyzed either as a
standard analysis or as a flexible analysis.
THE LOGISTICS INFORMATION SYSTEM (LIS) IS
MADE UP OF THE FOLLOWING INFORMATION
Sales Information System
Purchasing Information System
Shop Floor Information System
Plant Maintenance Information System
Quality Management Information System
Retail Information System (RIS)
Transport Information System (TIS)
LOGISTIC INFORMATION SYSTEM
PLANNING / FORECASTING
EARLY WARNING SYSTEM
LOGISTIC INFORMATION LIBRARY
RETAILING INFORMATION SYSTEM
Decision Support Systems (DSS):
An is designed to assist manager in non-routine semi-
structured or unstructured decisions. Combines use of
models and data from various sources. Allows user to
conduct a „what-if‟ analyses by changing the assumptions
underlying various components of the decision
Executive Support Systems:
Designed to support senior managers responsible for
making strategic decisions- non-routine and require
information about trends in the external environment as well
as internally. Incorporates information both from MIS and
DSS and external data about economic, competitive and
regulatory environment etc
RETAILING INFORMATION SYSTEM
Can be divided into 4 basic types :
Transaction Processing Systems (TPS):
Used to facilitate customer transactions and other routine business processes
(e.g. EPOS systems, payroll and employee record keeping). Critical to
operations. Forms major input into other systems
Management Information Systems (MIS):
To assist middle managers in their monitoring, controlling and decision-making
activities. Provide routine summary or exception reports
(usually from transaction data from TPS indicating firms current performance)
either in the form of a report or online access. Usually involve pre-specified
questions, simple summaries and comparisons.
The overseeing and controlling of the ordering, storage
and use of components that a company will use in the
production of the items it will sell as well as the
overseeing and controlling of quantities of finished
products for sale.
A business's inventory is one of its major assets and
represents an investment that is tied up until the item is
sold or used in the production of an item that is sold. It
also costs money to store, track and insure inventory.
Inventories that are mismanaged can create significant
financial problems for a business, whether the
mismanagement results in an inventory glut or an
PLANT MAINTENANCE INFORMATION SYSTEM
The Plant Maintenance Information System
(PMIS) is a subset of the Logistics
Information System (LIS) . It allows some
flexibility in the updating of information as
well as the ability to report on data trends
gathered over time .Rather than providing list
editing-type reports that allow a view of
specific work orders or pieces of equipment
SALES INFORMATION SYSTEM
Is a set of procedures and methods designed to
generate, analyze, disseminate, and store
anticipated marketing decision information on a
regular, continuous basis. An information system
can be used operationally, managerially, and
strategically for several aspects of marketing.
A marketing information system can be used
operationally, managerially, and strategically for
several aspects of marketing.
SALES INFORMATION SYSTEM
The information needed by marketing managers comes from three
1) Internal company information – E.g. sales, orders, customer profiles,
stocks, customer service reports .
2) Marketing intelligence – This can be information gathered from many
sources, including suppliers, customers, and distributors. Marketing
intelligence is a catchall term to include all the everyday information about
developments in the market that helps a business prepare and adjust its
marketing plans. It is possible to buy intelligence information from outside
suppliers (e.g. IDC, ORG, MARG) who set up data gathering systems to
support commercial intelligence products that can be profitably sold to all
players in a market.
3) Market research – Management cannot always wait for information to
arrive in bits and pieces from internal sources. Also, sources of market
intelligence cannot always be relied upon to provide relevant or up-to-date
information (particularly for smaller or niche market segments). In such
circumstances, businesses often need to undertake specific studies to
support their marketing strategy
SHOP FLOOR INFORMATION SYSTEM
In the standard system, the following standard analyses are available in the
Shop Floor Information System:
You can use the work center standard analysis to evaluate data from the area of work
centers. The information structure S024 provides the data basis.
In the standard analysis „operation‟ you can evaluate the data from the operation. The
data basis is provided by data updated to information structure S022.
The material standard analysis allows you to evaluate the data for material. The data
basis is formed by data that is updated to information structure S023.
In this analysis you can evaluate the data for production orders. The data basis is the
data updated to information structure S021
SHOP FLOOR INFORMATION SYSTEM
In the material usage analysis, you can analyze data from the production orders, run schedule
headers and process orders. You can use the material usage analysis to answer the following
questions: What components were used for a material in total? Which individual components were
affected by the material usage? What was the original requirements quantity and what was actually
taken? The basis of this analysis is provided by data that is updated to information structure S026.
Run Schedule Header
The run schedule header analysis enables you to evaluate the key figures from the run schedule
header. The data basis for this analysis is provided by the information structure S025.
Data from production orders, run schedule headers and process orders can be evaluated in the
product cost analysis. Both planned and actual costs for production and process orders are updated
to product costs. The planned costs are updated at the exact time of release, the actual costs are
updated at the point of completion confirmations and goods issues. The data basis of this analysis is
provided by data that is updated to information structure S027.
Reporting Point Statistics
The standard analysis „reporting point statistics‟ is used to evaluate the data from repetitive planning.
Here, the number of units for so-called reporting points (comparable with events in the production
order) are determined and updated. The data basis of the analysis is provided by the confirmed
quantities and the confirmed scrap for the reporting point, which are updated in information structure
PURCHASING INFORMATION SYSTEM
procedures, manual or computerized, followed by
an organization to achieve the following basic
1.To determine the quality and quantity needed
and the time when an item is needed
2. To obtain the best possible price
3. To maintain information on sources of supply.
The system should utilize such concepts as
Economic Order Quantity (EOQ) , optimal
reorder point, quantity discount , and Material
Requirement Planning (MRP)
TYPES OF PURCHASING SYSTEMS
The effectiveness of purchasing activities can be enhanced by
proper organization and coordination of the activities.
There are four types of purchasing system:-
Purchase made as per requirement: No purchase is made in
advance. Purchase is done as need arises. Method usually applied
for emergency requirement or infrequent goods.
Contract Purchasing: Contract of material is given to an agency. It
has an advantage that low price of those materials whose cost
Market Purchase: Purchase is made from the market to take
advantage of price fluctuations.
Schedule Purchasing: It is a cyclic purchase model. A schedule of
purchase is made and it is used for those commodities whose price
do not fluctuate.
QUALITY MANAGEMENT INFORMATION SYSTEM
The Essentials of Information Quality Management :
1. Understand information quality is a business problem, not just a systems
problem, and solve it as a business process, not just as a systems
2. Focus on the information customers and suppliers, not just the data
3. Focus on all components of information, including definition, content and
4. Measure data accuracy, not just validity.
5. Implement information quality management processes, not just
information quality software.
6. Measure costs – not just percent -– of no quality information and business
results of quality information.
7. Emphasize process improvement and preventive maintenance (Plan-Do-
Check-Act), not just corrective maintenance (data cleansing).
8. Improve processes at the source, not just in downstream business areas.
9. Provide quality training to managers and information producers (who their
information customers are, quality requirements and how to meet them).
10. Actively transform the culture, don't just implement activities
TRANSPORT INFORMATION SYSTEM
In the transport information system, the following standard analyses are available
The transport analysis displays information from the transport header and delivery header. The key figures for the
complete transport (such as distance, delivery time, weight) are updated in relation to the transport
MRP, transport type, service agent, starting point, and target point.
Use this analysis to display information about transport routes. The key figures for the complete transport are
updated in relation to the transport MRP, transport type, and service agent.
This analyzes the transport processes based on the main transport MRP. Key figures for dimensions and utilization
of MRPs are displayed.
The send analysis makes evaluation of data for deliveries of transport s possible from (transport MRP, delivery
type, and sending point).
This analysis allows for evaluations ate the transport leg level. The key figures for the transport sections (such as
distance, delivery time, weight) are updated in relation to the transport MRP, transport type, service
agent, starting point, and target point.
This analysis gives you information for the transport of certain materials.
As well as allowing you to analyze actual data, the
information systems in Logistics allow you to
create planning data. This planning data can be used
later on in the standard analyses in
The planning function in the information systems is
based on the standard information structures.
That is, it is possible to plan the information structures
that are available in the standard system,
as well as self-defined info structures.
EARLY WARNING SYSTEM
The Early Warning System is based on the key figures of the Logistics Information System (LIS) and
can be used for all of the applications in Logistics.
You can find the Early Warning System in all of the LIS information system menus.
The Early Warning System allows you to make decision-oriented selections and to check weak
areas in Logistics, by enabling you to search for exceptional situations. This means that you can
detect and rectify potential problems at an early stage.
You can define both Exceptions and the conditions for follow-up processing. An exception consists of
specified characteristics or characteristic values (for example customer, material), and requirements.
The following requirements can be defined:
For example, materials/customers whose sales are greater than 10,000 DM)
For example, materials/customers with a negative trend in sales or lead times)
For example, which customers have a plan realization for incoming orders of less than 80%)
In the planned/actual comparison, you specify the plan realization in percent and specify an operator
(>, <, = etc.). This type of requirement helps you to check the plan realization and to pinpoint the
weak areas between planned and actual data.
LOGISTIC INFORMATION LIBRARY
You use the Logistics Information Library (LIL) to
record, classify, and retrieve key figures.
The main benefits of the LIL are the following:
Central catalog of all key figures
Transparency of information with regard to availability
Faster, more direct access to key figures
Easy-to-use search strategies
No detailed system knowledge required
Grouping of key figures to form customized info sets
User-specific maintenance of control parameters
Key figure authorizations tailored to each user's needs
Avoidance of unnecessary system load due to predefined