This slides is related to information system & its types. Moreover how these information system work.

1. 1
Management Information
Systems - Class Note # 2

2. 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. 3Fig 2.1: Types of Information Systems

4. 4
Different kinds of systemsDifferent kinds of systems
 Information systems that monitor
the elementary activities and
transactions of the organization .
 Information systems that support
knowledge and data workers in
an organization.
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 Operational-level systems
 Knowledge-level systems
2.1

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 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 .
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 Strategic-level systems
 Management-level systems
Different kinds of systemsDifferent kinds of systems
2.1

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

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

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

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

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TYPICAL TPS APPLICATIONS
Sales & 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. 2-4Fig. 2-4 ( p.43 )

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

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

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

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

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 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 .
Six Major Types of SystemsSix Major Types of Systems
2.1

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 Information systems at the management
level of organization that serve the functions
of planning, controlling, and decision
making by providing routine summary and
exception reports.
 MIS – Management Information
Systems
Six Major Types of SystemsSix Major Types of Systems
2.1
Example: Annual budgetingExample: Annual budgeting

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• Structured and semi-structured decisionsStructured and semi-structured decisions
• Report control orientedReport control oriented
• Past and present dataPast and present data
• Internal orientationInternal orientation
MISMIS
2.1

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

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

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

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

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

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

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• Top level managementTop level management
• Designed to the individualDesigned to the individual
• Ties CEO to all levelsTies CEO to all levels
• Very expensive to keep upVery expensive to keep up
• Extensive support staffExtensive support staff
ESSESS
2.1

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

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

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

28. 28Fig 2-9: Interrelationships among systems
2.2 Systems from a Functional2.2 Systems from a Functional
PerspectivePerspective

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 SALES & MARKETING SYSTEMS
 MANUFACTURING & PRODUCTION
SYSTEMS
 FINANCE & ACCOUNTING SYSTEMS
 HUMAN RESOURCES SYSTEMS
2.2 Systems from a Functional2.2 Systems from a Functional
PerspectivePerspective

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2.2 Systems from a Functional2.2 Systems from a Functional
PerspectivePerspective
Major functions of systems:Major functions of systems:
 Sales management, market research, promotion,Sales management, market research, promotion,
pricing, new productspricing, new products
Major application systems:Major application systems:
 Sales order info system, market research system,Sales order info system, market research system,
pricing systempricing system
Sales and MarketingSales and Marketing SystemsSystems

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Sales and MarketingSales and Marketing SystemsSystems

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2.2 Systems from a Functional2.2 Systems from a Functional
PerspectivePerspective
Major functions of systems:Major functions of systems:
 Scheduling, purchasing, shipping, receiving,Scheduling, purchasing, shipping, receiving,
engineering, operationsengineering, operations
Major application systems:Major application systems:
 Materials resource planning systems, purchaseMaterials resource planning systems, purchase
order control systems, engineering systems,order control systems, engineering systems,
quality control systemsquality control systems
Manufacturing and ProductionManufacturing and Production SystemsSystems

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Manufacturing and ProductionManufacturing and Production SystemsSystems

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2.2 Systems from a Functional2.2 Systems from a Functional
PerspectivePerspective
Major functions of systems:Major functions of systems:
 Budgeting, general ledger, billing, costBudgeting, general ledger, billing, cost
accountingaccounting
Major application systems:Major application systems:
 General ledger, accounts receivable, accountsGeneral ledger, accounts receivable, accounts
payable, budgeting, funds management systemspayable, budgeting, funds management systems
Financing and AccountingFinancing and Accounting SystemsSystems

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Financing and AccountingFinancing and Accounting SystemsSystems

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2.2 Systems from a Functional2.2 Systems from a Functional
PerspectivePerspective
Major functions of systems:Major functions of systems:
 Personnel records, benefits, compensation, laborPersonnel records, benefits, compensation, labor
relations, trainingrelations, training
Major application systems:Major application systems:
 Payroll, employee records, benefit systems,Payroll, employee records, benefit systems,
career path systems, personnel training systemscareer path systems, personnel training systems
Human ResourceHuman Resource SystemsSystems

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Human ResourceHuman Resource SystemsSystems

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Business processesBusiness processes
 Manner in which work is organized, coordinated, andManner in which work is organized, coordinated, and
focused to produce a valuable product or servicefocused to produce a valuable product or service
 Concrete work flows of material, information, andConcrete work flows of material, information, and
knowledge—sets of activitiesknowledge—sets of activities
 Unique ways to coordinate work, information, andUnique ways to coordinate work, information, and
knowledgeknowledge
 Ways in which management chooses to coordinate workWays in which management chooses to coordinate work
2.3 Business Processes and
Information Systems

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 Manufacturing and production:Manufacturing and production: AssemblingAssembling
product, checking quality, producing bills ofproduct, checking quality, producing bills of
materialsmaterials
 Sales and marketing:Sales and marketing: Identifying customers,Identifying customers,
creating customer awareness, sellingcreating customer awareness, selling
Examples of Business ProcessesExamples of Business Processes
2.3 Business Processes and Information Systems

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

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Information systems help organizationsInformation systems help organizations
 Achieve great efficiencies by automating partsAchieve great efficiencies by automating parts
of processesof processes
 Rethink and streamline processesRethink and streamline processes
2.3 Business Processes and Information Systems

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Customer Relationship Management (CRM)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
2.3 Business Processes and Information Systems

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

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2.3 Business Processes and Information Systems
Supply Chain Management (SCM)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

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

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

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2.3 Collaborative CommerceCollaborative Commerce
Figure 2-15

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2.3 Enterprise SystemEnterprise System
Figure 2-17

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Figure 2-18
2.4 Global System Configuration

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