Bus com topic 2

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1. 2 INFORMATION SYSTEMS IN THE ENTERPRISE Chapter
2.
o What are the key system applications in a business? What role do they play?
o How do information systems support the major business functions?
o Why should managers pay attention to business processes?
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise OBJECTIVES
3.
o What are the business benefits of using collaborative commerce, private industrial networks and
enterprise systems?
o What types of information systems are used by companies that operate internationally?
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise OBJECTIVES
4.
o Integration: Different systems serve variety of functions, connecting organizational levels
difficult, costly
o Enlarging scope of management thinking: Huge system investments, long development time
must be guided by common objectives
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise MANAGEMENT
CHALLENGES
5. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Types of
Information Systems KEY SYSTEM APPLICATIONS IN THE ORGANIZATION Figure 2-1
6. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Major
Types of Systems
o Executive Support Systems (ESS)
o Decision Support Systems (DSS)
o Management Information Systems (MIS)
o Knowledge Work Systems (KWS)
o Office Automation Systems (OAS)
o Transaction Processing Systems (TPS)
KEY SYSTEM APPLICATIONS IN THE ORGANIZATION
7. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise TYPES OF
INFORMATION SYSTEMS Figure 2-2
8. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise KEY
SYSTEM APPLICATIONS IN THE ORGANIZATION
o Transaction Processing Systems (TPS):
o Basic business systems that serve the operational level
o A computerized system that performs and records the daily routine transactions necessary to
the conduct of the business

9. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Payroll
TPS KEY SYSTEM APPLICATIONS IN THE ORGANIZATION Figure 2-3
10. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Types of
TPS Systems KEY SYSTEM APPLICATIONS IN THE ORGANIZATION Figure 2-4
11.
o Knowledge Work Systems (KWS):
o Knowledge level
o Inputs: Design specs
o Processing: Modeling
o Outputs: Designs, graphics
o Users: Technical staff
o Example: Engineering work station
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise KEY SYSTEM
APPLICATIONS IN THE ORGANIZATION
12.
o Management Information System (MIS):
o Management level
o Inputs: High volume data
o Processing : Simple models
o Outputs: Summary reports
o Users: Middle managers
o Example: Annual budgeting
SYSTEM APPLICATIONS IN THE ORGANIZATION Management Information System (MIS) Figure 2-5
14.
o Structured and semi-structured decisions
o Report control oriented
o Past and present data
o Internal orientation
o Lengthy design process
APPLICATIONS IN THE ORGANIZATION Management Information System (MIS)
15.
o Decision Support System (DSS):

o Management level
o Inputs: Low volume data
o Processing: Interactive
o Outputs: Decision analysis
o Users: Professionals, staff
o Example: Contract cost analysis
SYSTEM APPLICATIONS IN THE ORGANIZATION Decision Support System (DSS) Figure 2-6
SYSTEM APPLICATIONS IN THE ORGANIZATION Decision Support System (DSS) Figure 2-7
18.
o Executive Support System (ESS):
o Strategic level
o Inputs: Aggregate data
o Processing: Interactive
o Outputs: Projections
o Users: Senior managers
o Example: 5-year operating plan
SYSTEM APPLICATIONS IN THE ORGANIZATION Executive Support System (ESS) Figure 2-8
20.
o Top level management
o Designed to the individual
o Ties CEO to all levels
o Very expensive to keep up
o Extensive support staff
APPLICATIONS IN THE ORGANIZATION Executive support system (ESS)
21. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise
INTERRELATIONSHIPS AMONG SYSTEMS Figure 2-9
22.
o Major functions of systems:
o Sales management, market research, promotion, pricing, new products

o Major application systems:
o Sales order info system, market research system, pricing system
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise SYSTEMS FROM A
FUNCTIONAL PERSPECTIVE Sales and Marketing Systems
23. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise SYSTEMS
FROM A FUNCTIONAL PERSPECTIVE Sales and Marketing Systems
24.
o Scheduling, purchasing, shipping, receiving, engineering, operations
o Materials resource planning systems, purchase order control systems, engineering systems,
quality control systems
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Manufacturing and
Production Systems SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
Manufacturing and Production Systems SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
26. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Overview
of Inventory Systems SYSTEMS FROM A FUNCTIONAL PERSPECTIVE Figure 2-10
27.
o Budgeting, general ledger, billing, cost accounting
o General ledger, accounts receivable, accounts payable, budgeting, funds management systems
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Financing and
Accounting Systems SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
28. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Financing
and Accounting Systems SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
29.
o Personnel records, benefits, compensation, labor relations, training
o Payroll, employee records, benefit systems, career path systems, personnel training systems
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise SYSTEMS FROM A
FUNCTIONAL PERSPECTIVE Human Resource Systems
30. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Human
Resource Systems SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
31. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Human
Resource Systems SYSTEMS FROM A FUNCTIONAL PERSPECTIVE Figure 2-11
32.
o Business processes

o Manner in which work is organized, coordinated, and focused to produce a valuable product or
service
o Concrete work flows of material, information, and knowledge—sets of activities
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Business
Processes and Information Systems INTEGRATING FUNCTIONS AND BUSINESS PROCESSES
33.
o Unique ways to coordinate work,
o information, and knowledge
o Ways in which management chooses
o to coordinate work
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise INTEGRATING
FUNCTIONS AND BUSINESS PROCESSES Business Processes and Information Systems
34.
o Information systems help organizations
o Achieve great efficiencies by automating parts of processes
o Rethink and streamline processes
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Business
Processes and Information Systems INTEGRATING FUNCTIONS AND BUSINESS PROCESSES
35.
o Manufacturing and production: Assembling product, checking quality, producing bills of materials
o Sales and marketing: Identifying customers, creating customer awareness, selling
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Examples of
Business Processes INTEGRATING FUNCTIONS AND BUSINESS PROCESSES
36.
o Finance and accounting: Paying creditors, creating financial statements, managing cash
accounts
o Human Resources: Hiring employees, evaluating performance, enrolling employees in benefits
plans
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Examples of
Business Processes INTEGRATING FUNCTIONS AND BUSINESS PROCESSES
37.
o Cross-Functional Business Processes
o Transcend boundary between sales, marketing, manufacturing, and research and development
o Group employees from different functional specialties to a complete piece of work
o Example: Order Fulfillment Process
FUNCTIONS AND BUSINESS PROCESSES Business Processes and Information Systems

38. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise The Order
Fulfillment Process INTEGRATING FUNCTIONS AND BUSINESS PROCESSES Figure 2-12
39.
o Customer Relationship Management (CRM)
o Manages all ways used by firms to deal with existing and potential new customers
o Business and Technology discipline
o Uses information system to coordinate entire business processes of a firm
FUNCTIONS AND BUSINESS PROCESSES Customer Relationship Management (CRM)
40.
o Provides end-to-end customer care
o Provides a unified view of customer across the company
o Consolidates customer data from multiple sources and provides analytical tools for answering
questions
FUNCTIONS AND BUSINESS PROCESSES Customer Relationship Management (CRM)
INTEGRATING FUNCTIONS AND BUSINESS PROCESSES Customer Relationship Management (CRM) Figure 2-
13
42.
o Supply Chain Management (SCM)
o Close linkage and coordination of activities involved in buying, making, and moving a product
o Integrates supplier, manufacturer, distributor, and customer logistics time
o Reduces time, redundant effort, and inventory costs
FUNCTIONS AND BUSINESS PROCESSES Supply Chain Management (SCM)
43.
o Supply Chain
o Network of organizations and business processes
o Helps in procurement of materials, transformation of raw materials into intermediate and finished
products
44.
o Helps in distribution of the finished products to customers
o Includes reverse logistics - returned items flow in the reverse direction from the buyer back to
the seller

INTEGRATING FUNCTIONS AND BUSINESS PROCESSES Supply Chain Management Figure 2-14
46.
o Decide when, what to produce, store, move
o Rapidly communicate orders
o Communicate orders, track order status
o Check inventory availability, monitor levels
o Track shipments
o Plan production based on actual demand
o Rapidly communicate product design change
o Provide product specifications
o Share information about defect rates, returns
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise How Information
Systems Facilitate Supply Chain Management INTEGRATING FUNCTIONS AND BUSINESS PROCESSES
47.
o Limitations:
o Inefficiencies can waste as much as 25% of company’s operating costs
o Bullwhip Effect: Information about the demand for the product gets distorted as it passes from
one entity to next
48.
o Supply chain planning system: Enables firm to generate forecasts for a product and to develop
sourcing and a manufacturing plan for the product
o Supply chain execution system: Manages flow of products through distribution centers and
warehouses
49.
o Uses digital technologies to enable multiple organizations to collaboratively design, develop,
build, move, and manage products
o Increases efficiencies in reducing product design life cycles, minimizing excess inventory,
forecasting demand, and keeping partners and customers informed
FUNCTIONS AND BUSINESS PROCESSES Collaborative Commerce
50. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Figure 2-
15 INTEGRATING FUNCTIONS AND BUSINESS PROCESSES Collaborative Commerce
51.
o Private Industrial Networks
o Web-enabled networks

o Link systems of multiple firms in an industry
o Coordinate transorganizational business processes
FUNCTIONS AND BUSINESS PROCESSES Industrial Networks
52.
o Within the business: There are functions, each having its uses of information systems
o Outside the organization’s boundaries: There are customers and vendors
o Functions tend to work in isolation
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Traditional View of
the Systems INTEGRATING FUNCTIONS AND BUSINESS PROCESSES
53. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Traditional
View of the Systems INTEGRATING FUNCTIONS AND BUSINESS PROCESSES Figure 2-16
54. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Enterprise
Systems INTEGRATING FUNCTIONS AND BUSINESS PROCESSES Figure 2-17
55.
o Firm structure and organization: One organization
o Management: Firm-wide knowledge-based management processes
o Technology: Unified platform
o Business: More efficient operations and customer-driven business processes
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Benefits of
Enterprise Systems INTEGRATING FUNCTIONS AND BUSINESS PROCESSES
56.
o Difficult to build: Require fundamental changes in the way the business operates
o Technology: Require complex pieces of software and large investments of time, money, and
expertise
o Centralized organizational coordination and decision making: Not the best way for the firms to
operate
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Challenges of
Enterprise Systems INTEGRATING FUNCTIONS AND BUSINESS PROCESSES
57.
o Four main ways of organizing businesses
o internationally:
o Domestic Exporter: Heavy centralization of corporate activities in the home country of origin
o Multinational: Financial management and control out of a central home base, production, sales
and marketing operations decentralized
Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise INTERNATIONAL
INFORMATION SYSTEMS Forms of Global Business Organization
58.

o Franchiser: Product created, designed, financed, and produced in the home country, relies on
foreign personnel for production, marketing and human resources
o Transnational: No national headquarters; value-added activities managed from a global
perspective, no reference to national borders, sources of supply and demand and local competitive advantage
optimized
INFORMATION SYSTEMS Forms of Global Business Organization
59.
o Four types of system configuration:
o Centralized Systems
o Duplicated Systems
o Decentralized Systems
o Networked Systems
INFORMATION SYSTEMS Global System Configuration
60. Essentials of Management Information Systems Chapter 2 Information Systems in the Enterprise Global
System Configuration INTERNATIONAL INFORMATION SYSYTEMS Figure 2-18
61. 2 INFORMATION SYSTEMS IN THE ENTERPRISE Chapter

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