The document discusses management information systems and their various applications in business. It describes how businesses use systems for transaction processing, supply chain management, customer relationship management, human resources, accounting, finance, manufacturing, and marketing. It explains that management information systems help businesses integrate processes, gain insights from data, and improve productivity, customer service, and decision-making.

1. MANAGEMENT INFORMATION
SYSTEM

2.  Business application or business software is any software or
set of computer programs that are used by business users to
perform various business functions.
 Business application are used to increase productivity, to
measure productivity and to perform business functions
accurately.
 These are categorized as small, medium and large.
 The small business market consists of home accounting
software and office suites such as Microsoft office.

3.  The medium size, or small and medium- sized
enterprise(SME), has a broader range of software
applications, ranging from accounting, groupware, customer
relationship management, human resource management
systems, outsourcing relationship management, Shopping
cart software and other productivity enhancing applications.
 The large size covers enterprise level software applications,
such as those in the field of enterprise resource planning,
enterprise content management, business process
management and product lifecycle management.

4.  Electronic business is the administration of conducting business
via internet. It is application of Information and communication
technologies in support of all the activities of business.
 It is use of internet and other networks and information
technologies to support e-commerce, enterprise communication
and collaboration and web enabled business process, both within
a networked enterprise and with its customer and business
partners.
 E-business includes E-commerce, which includes buying, selling
and marketing products over the internet.

5.  Many companies today are using information technologies to
develop integrated cross functional enterprise systems that cross
the boundaries of traditional business functions in order to
reengineer and improve vital business process, and develop
strategic relationship with customers, suppliers, and business
partners.
 This typically involves installing enterprise resource planning,
supply chain management, or customer relationship management
software.
 Business firms are using internet technologies to help them
reengineer and integrate the flow of information among their
internal business process and their customers and suppliers.

6.  The enterprise application architecture of a business is a
description of the structured of the application and software
use across the organization.
 The system are broken down into subsystem and connected
to each other based on the relationship between them.
 It provides a conceptual framework to help visualize the basic
components, processes, and interfaces of these major e-
business applications, and their interrelationship to each
other.
 It includes CRM, ERP, SCM and KM.

7.  It is the process of linking such applications within a single
organization together in order to simplify and automate
business process to the greatest extent possible, while at the
same time avoiding having to make full changes to the
existing application or data structures.
 Unrestricted sharing of data and business processes among
any connected application or data sources in the enterprise.
 EAI software being used by many companies to connect their
major e- business applications.

8.  EAI software can integrate the front office and back office
applications of a business so they work together in a
seamless, integrated way.
 This is a vital capability that provides real business value to
business enterprise events and customer demand.
 E.g. Improvement in customer call center responsiveness and
effectiveness because EAI integrates access to the entire
customer and product data customer representative need to
quickly serve customer.

9.  EAI can be used for different purpose:
 Data Integration: ensures that information in multiple systems are
kept consistent.
 Vendor independence: Extracts business policies or rules from
applications and implements them in EAI systems, so that even if
one of the business applications is replaced with a different
vendor’s application, the business rules don’t have to be re-
implemented.
 Common interface: An EAI system can front-end cluster of
applications, providing a single consistent access interface to
these applications and shielding users from having to learn to use
different software packages.

10.  Transaction Processing System are cross- functional information
systems that process data resulting the occurrence of business
transactions.
 Transaction are the events that occurs as part of doing business,
such as sales, purchases, deposits, withdrawals, refunds, and
payments.
 Data about the customer, product, salesperson, store and so on
must be captured and processed. Credit checks, customer billing,
inventory changes, and increase In accounts recievable balances
generate even more data.
 Transaction processing activities are needed to capture and
process such data, or the operation of business would halt.

11.  Transaction processing is of several basic activities.
 Data Entry:The first step of transaction processing cycle is the
capture of business data.Transaction data may be collected
by POS terminals and also captured at an e- commerce web
site and internet.
 The proper recording and editing of data so they are quickly
and correctly captured for processing is one of the major
challenges of information systems.

12.  Transaction Processing:
 Transaction processing system processes data in two basic ways:
one is batch processing, where transaction data are accumulated
over a period of time and processed periodically, second is real
time processing where data is processed immediately after
transaction occurs.
 Database Maintenance: An organization’s databases must be
updated by its transaction processing systems so that they are
always correct and up to date. Databases maintenance ensures
that the changes are reflected in the data records stored in
company’s databases.

13.  Document and report generation:
 Transaction processing systems produce a variety of documents
and reports. purchase orders, paychecks, sales receipt, invoices
and customer statements are examples of transaction documents.
Payroll register, edit reports are the form of transaction reports.
 Inquiry Processing:
 Many transaction processing system allow user to use the
internet, intranets, extranets and web browser or database
management query language to make inquiries and receive
responses. For e.g. checking the status of sales order, balance in
the account, amount of stock in inventory.

14.  Enterprise collaboration systems (ECS) are cross functional
information systems that enhance communication,
coordination, and collaboration among the members of
business teams and workgroups.
 The Goal of enterprise collaboration is to enable us to work
together more easily and effectively by helping to
Communicate, Coordinate and Collaborate.

15.  The capabilities and potential of the internet, as well as
extranets, are driving the demand for better enterprise
Collaboration tools in business.
 The enterprise collaboration tools are:
 Electronic communication tools: E-Mail, Instant messaging,
voice mail, faxing, web publishing, paging.
 Enterprise Collaboration Systems: Data Conferencing,Video
Conferencing,Voice Conferencing, Discussion forums, Chat
systems, Electronic Meeting Systems.

16.  Calendar and Scheduling,Task and project management,
workflow systems, Document Sharing, Knowledge
Management.

17.  There are many ways to use information technology in business as
there are business activities to be performed, business problems
to be solved, and business opportunities to be pursued.
 It is important to have a specific understanding of how
information system affect a particular business function or
particular industry.
 E.g someone whose career objective is marketing in banking
should have a basic understanding of how information system are
used in banks and how they support the marketing activities of
banks and firms.

18.  The business function of marketing is concerned with planning,
promotion and sales of existing products in existing markets, and
development of new products and new markets to better attract
and serve present and potential customer.
 Business firms have increasingly turned to information technology
to help them perform vital marketing functions in the face of the
rapid changes of today’s environment.
 For e.g. Internet/ intranet web sites makes interactive marketing
process possible where customer can become partners in creating
marketing, purchasing and improving products and services.

19.  Marketing information system assists marketing managers in
product planning, pricing, and other product management
decisions; advertising sales, promotion, and targeted
marketing strategies and market research and forecast.
 Some of the marketing applications are:

20.  A customer focused marketing process that is based on using the
internet, Intranets, and extranets to establish two- way
transaction between a business and its customer or potential
customers.
 Interactive marketing encourages customers to become involved
in product development, delivery and service issues. It is enabled
by various internet technologies, including chat, discussion
groups, web forums, instant messaging and email
correspondence.
 The expected outcomes of interactive marketing are the rich
mixture of vital marketing data, new product ideas, volume sales
and strong customer relationship.

21.  Targeted marketing has become an important tool in
developing advertising and promotion strategies to
strengthen a company’s e- commerce initiatives, as well as
traditional business venues. It includes five targeting
components:
 Community
 Content
 Context
 Demographic/ Psychographic
 Online Behaviour

22.  Computers and the internets are providing the basis for sales force
automation.
 IN many companies sales force are being outfitted with notebook
computer, web browser and sales contact management software
that connects them to marketing.
 It increases the personal productivity of sales person as well as
speeds up the capture data from the field to marketing managers
at company headquarters.
 Many companies are viewing sales force automation as a way to
gain a strategic advantage in sales productivity and marketing
responsiveness.

23.  Manufacturing information system supports the
production/operation function that includes all activities
concerned with the planning and production of goods or
services.
 Information systems used for operations management and
transaction processing supports all firms that must plan,
monitor and control inventories, purchases and the flow of
goods and services.

24.  CIM is an overall concept that emphasize that the objectives
of computer-based systems in manufacturing must be to:
 Simplify (reengineer) production processes, product designs,
and factory organization as a vital foundation to automate
and integration.
 Automate production processes and the business functions
that support them with computers, machines and robots.
 Integrate all production and support processes using
computer networks, cross functional business software and
other information technologies.

25.  The overall aim of CIM and such manufacturing information
systems is to create flexible, agile manufacturing processes
that efficiently produce product of highest quality.
 Computers are used to help engineers design better products
using both computer-aided engineering (CAE) and computer
aided design (CAD) systems, and better production processes
with computer aided process planning.

26.  Those system that automates the production process. E.g.
monitoring and controlling the production process in a factory
or by directly controlling the a physical process, a machine
tool or machine with some human like capabilities.

27.  Performance monitoring information systems for factory floor
operations.
 They monitor and control the five essential components
involved in a production process: materials, equipment,
personnel, instructions and specifications, and production
facilities.
 MES includes shop floor scheduling and control, machine
control, robotis control and process control system.

28.  Use of computer to control an ongoing physical process.
Process control computer control physical processes in
petroleum refineries, cement plants, steel mills, chemical
plants, food product manufacturing plants and so on.
 The continuous physical measurement are converted to
digital form by analog- to- digital converters and relayed to
computer for processing.

29.  Use of computers to control the actions of machines.This is
also popularly called numerical control.
 The computer based control of machine tools to manufacture
products of all kinds is typical numerical control application
used by many factories throughout the world.

30.  The Human Resource Management function involves the
recruitment, placement, evaluation, compensation , and
development of the employees of an organization.
 The human resource information system are designed to
support
 Planning to meet the personnel needs of the business
 Development of the employees to their full potential
 Control of all personnel policies and programs

31.  The internet has become a major force to change in human
resource management. E.g. online HRM system may involve
recruiting for employees through recruiting for employees
through recruitment sections of corporate web sites.
 The web sites are full of reports, statistics, and other useful
HRM information such as job reports by industry, or listings of
the top recruiting markets by industry and professionals.

32.  HRM and corporate intranet technologies allow companies to
process most common HRM applications over their corporate
intranets.
 Intranets can collect information online from employees for input
to their HRM files, and they can enable managers and other
employees to perform HRM task with little intervention by HRM
department.
 E.g. Employee self- service (ESS) intranet application allows
employees to view benefits, enter travel expense reports, verify
employment and salary information, access and update their
personal personal information, and enter time- sensitive data.

33.  Accounting information systems are the oldest and most
widely used information systems in business and records
business transaction and other economic events.
 Computer based accounting systems record and report the
flow of funds through an organization on a historical basis and
produce important financial statements such as balance
sheets and income statements.
 Many accounting software packages are available for these
applications:

34.  Using the internet and other networks changes how accounting
information system monitors and track business activity.
 Online accounting system particularly applies to systems like
order processing, inventory control, accounts receivable, and
account payable.
 These system are directly involved for processing of transaction
between a business and its customers and suppliers.
 Naturally, many companies are using internet and other network
links to these trading partners for such OnlineTPS.

35.  It is a system that every organization has maintained day to day to
know and run the organization smoothly. It is summarized as:
 Order Processing: Captures and processes customer orders and
produce data for inventory control and accounts receivable.
 Inventory control: processes data reflecting changes in inventory
and provide shipping and reorder information.
 Accounts Receivable: Records amounts owed by customers and
produce customer invoices, monthly customer statements, and
credit management reports.

36.  Accounts payable: records purchases from, amounts owed to
and payments to suppliers and produce cash management
reports.
 Payroll: Records employee work and compensation data and
produce paychecks and other payroll documents and reports.
 General Ledger: Consolidates data from other accounting
systems and produce the periodic financial statements and
reports of the business.

37.  Computer based financial management system supports
business managers and professionals in decision concerning
the financing of a business and allocation and control of
financial resources within a business.
 Major financial management systems includes cash and
investment management, capital budgeting, financial
forecasting, and financial planning.
 Financial analyst typically use electronic spreadsheets and
other financial planning software to evaluate the present and
projected financial performance of a business.

38.  Customer focused business is one of the top business strategies
that can be supported by information technology.
 Many companies are implementing customer relationship
management (CRM) business initiatives and information systems
as part of customer focused or customer centric strategy to
improve their chances for success in today’s competitive business
environment.
 CRM uses information technology to create a cross functional
enterprise system that integrates and automates many of the
customer serving processes in sales, marketing and customer
service that interact with a company’s customers.

39.  CRM system includes a family f software modules that
provides tools that enables a business and its employees to
deliver fast, convenient, dependable and consistent service to
its customers.
 Siebel systems, Oracle, peoplesoft, SAP are some of the
leading vendors of CRM software.
 Some major application components of a CRM system are:

40.  CRM software helps sales, marketing, and service
professionals capture and track relevant data about every past
and planned contact with prospects and customers, as well as
other business and life cycle events of customers.
 Information is captured from all customers touch points, such
as telephone, fax, email, the company’s website, retail stores,
kiosks, and personal contact and stores the data in a common
customer database.

41.  A CRM provides sales representative with the software tools
and company data sources they need to support and manage
their sales activities and optimize cross- selling and up-selling.
 CRM also provides real time access to a single common view
of the customer, enabling sales representative to check on all
aspects of a customer’s account status and history before
scheduling their sales cost.

42.  CRM system help marketing professionals accomplish direct
marketing campaigns by automating such task as qualifying
leads for targeted marketing and scheduling and tracking
direct marketing mailings.
 CRM software helps marketing professionals capture and
manage prospect and customer response data in the CRM
database, and analyzes the customer’s and business value of
company’s direct marketing campaigns.

43.  A CRM system provides service with software tools and real-
time access to common customer database shared by sales
and marketing professionals.
 CRM helps customer service mangers create, assign and
mange request for service by customer.

44.  Enhancing and optimizing customer retention and loyalty is a
major business strategy and primary objective of customer
relationship management.
 CRM system helps a company identify, reward and market to
their most profitable and loyal customer.

45.  CRM can be viewed as an integrated system of web-enabled
software tools and databases accomplishing a variety of customer
focused business processes that support the three phases of
relationship between business and its customers.
 ACQUIRE:A business relies on CRM software tools and databases
to help it acquire new customers by doing a superior job of
contract management, sales prospecting, selling, direct marketing
and fulfillment.
 ENHANCE: CRM sales force automation and direct marketing and
fulfilment tools help companies cross sell and up sell to their
customer, thus increasing the profitability to the business.

46.  RETAIN: CRM analytical software and database help a
company proactively identify and reward its most loyal and
profitable customer to retain and expand their business via
targeted marketing and relationship marketing programs.

47.  The potential benefits of CRM are:
 CRM allows a business to identify and target its best
customers
 It makes possible real- time customization and
personalization of products and services based on customer
needs, buying habits, and life cycles.
 CRM system can enable a company to provide a consistent
customer experience and superior service and support across
all the contact points a customer choose.

48.  The business benefits of CRM are not guaranteed and instead
have proven elusive at many companies.The common
reasons are:
 Lack of senior management sponsorship
 Improper chain management
 Elongated projects that take on too much, too fast
 Lack of or poor integration between CRM and core business
systems
 Lack of end- user incentives leading to poor user adoption
rates

49.  Increasingly enterprise must create tighter collaborative
linkages with partners, suppliers, and customer, squeezing out
time and cost while enhancing the customer experience and
total value proposition.
 Most of the organization implements the four types of CRM,
they are Operational, analytical, Collaborative and portal-
based.

50.  Business of all kinds have now implemented enterprise resource
planning(ERP) systems.
 ERP serves as a cross functional enterprise backbone that
integrates and automates many internal business processes and
information systems within the manufacturing logistics,
distribution, accounting, finance, and human resource functions
of a company.
 ERP is a technology backbone of e-business and is a cross
functional enterprise system driven by integrated suite of
software modules that support the basic internal processes of a
company.

51.  ERP systems can generate significant business benefits for a
company.
 Quality and efficiency:
 Decreased cost
 Decision support
 Enterprise agility:

52.  Underestimation of the complexity of the planning,
development, and training
 Failure to involve affected employees in the planning and
development phases
 Insufficient training in new work task
 Over relying of company and it management on the claims of
ERP software vendors.

53.  Today, ERP is still evolving- adapting to developments in
technology and the demands of the market.
 Four major trends are shaping ERP’s continuing evolution:
 Improvement on integration and flexibility
 Extension to e-business applications
 A broader reach to new users
 And the adoption of internet technologies

54.  Starting a e- business takes ideas, capital, and technical savvy.
Operating one however takes SCM skills.
 A successful SCM strategy is based on accurate order processing,
just in time inventory management, and timely order fulfillment.
 Many companies today are making supply chain management a
top strategic objective and major e-business application
development initiative.
 Supply chain management helps companies get the right
products to the right place at the right time, in the proper quantity
and acceptable cost.

55.  The goal of SCM is to manage this process efficiently by
forecasting demand, controlling inventory, enhancing the
network of business relationship a company have with
customers, suppliers, distributors and others.
 To achieve this goal many companies today are turning to
Internet technologies to web- enable their supply chain
processes, decision making, and information flows.

56.  Electronic data interchange was one of the earliest uses of
information technology for SCM.
 EDI involved the electronic exchange of business transaction
documents over internet and other network between supply
chain trading partners.
 EDI software’s is used to convert a company’s own document
format into standardized EDI formats as specified by various
industry and international protocol.
 EDI is an example of almost complete automation of an e-
commerce supply chain process.

57.  The role of information technology in SCM is to support
planning, execution objectives with enterprise information
systems that produce many of the outcomes a business needs
to manage its supply chain effectively.
 Due to the reason many companies today are installing SCM
software and developing web based SCM information
systems.

58.  Creating a real time SCM infrastructure is a discouraging and
ongoing issue and often a point of failure for several reasons.
 SCM can provide companies with key business benefits such
as faster, more accurate order processing, reductions in
inventory level, quicker times to market, lower transaction
and material cost and strategic relationship with the suppliers.
 However, developing effective systems has proven to be
complex and difficult application of information technology to
business operations.

59.  The trends in use of SCM today as three possible stages in
implementation of SCM System.
 In first stage the company concentrates on making improvement to its
internal supply chain process and its external process and relationship
with suppliers and customers.
 In the stage two, a company accomplish substantial supply chain
management applications by using selected SCM software programs
internally, as well as externally via intranet and extranet links among
suppliers, distributors, customers and other trading partners.
 In the third stage, a company beings to develop and implement
cutting- edge collaborative supply chain management applications
using advanced SCM software, full service extranet links, and private
and public e-commerce exchanges.

60.  Electronic commerce, commonly known as e- commerce consists
of the buying and selling of products and services over electronic
systems such as the Internet and other computer networks.
 For most companies today E- commerce is more than just buying
and selling products online.
 It encompasses the entire online process of developing ,
marketing, selling, delivering, servicing, and paying for products
and services transacted on inter- networked, global marketplaces
of customer, with the support of a worldwide network of business
partners.

61.  The range of business processes involved in marketing,
buying, selling and servicing of products and services in
companies that engage e-commerce.
 Companies involved in e- commerce as either buyer or sellers
rely on Internet based technologies and e-commerce
applications and services to accomplish marketing, discovery,
transaction processing, and product and customer service
processes.

63.  Many companies today are participating in or sponsoring four
basic categories of e-commerce applications:
Business-to-consumer (B2C) e- commerce: Business develop
attractive electronic marketplaces to sell products and
services to customer.
 Consumer-to-Consumer (C2C) e-commerce:The huge success
of online auctions like e-bay, where consumer can buy from
and sell to another in an auction process at an auction web
site, makes this model an important e-commerce strategy.

64.  Business-to-Business (B2B) e-commerce:This category of e-
commerce involves both e-business marketplace and direct
market links between businesses.

65.  There are nine key components of e-commerce processes
architecture that is the foundation of the e- commerce
initiatives of many companies today.

66.  E- commerce must establish mutual trust and secure access
between the parties in an e- commerce transaction by
authenticating users, authorizing access, and enforcing
security features.
 Security process protect the resources of e- commerce sites
from threats such as hacker attacks, theft of passwords or
credit card numbers, and system failures.

67.  Once gained access to an e-commerce site, profiling
processes can occur that gather data on you and your web sit
behavior and choices, as well as build electronic profiles your
characteristics and preferences.
 These profiles are used to recognize you as an individual user
and provide you with a personalized view of the contents of
the site, as well as product recommendations.

68.  Efficient and effective search processes provide a top e-
commerce web site capability that helps customers find the
specific product or service they want to evaluate or buy.
 E-commerce software packages can include a web site search
engine components, or a company may acquire a customized
e- commerce search engine from search technology
companies like google.

69.  content management software helps e-commerce companies
develop, generate, deliver, and archive text data and
multimedia information at e-commerce web sites.
 E- commerce contents frequently take the form of multimedia
catalogs of product information.

70.  Many of the business in e-commerce applications can be managed
and partially automated with the help of workflow management
software.
 Workflow management in both e- business and e- commerce
depends on the workflow search engine containing software
models of the business process to be accomplished.
 Workflow system ensures the that the proper transactions,
decisions, and work activities are performed, and the correct data
and documents are routed to right employees, customers,
suppliers, and other business stakeholders.

71.  Most e- commerce applications are event driven systems that
responds to a multitude of events- from a new customer’s first
website access, to payment and delivery processes, to
innumerable customer relationship and supply chain
management.
 Customers, suppliers, employees and other stakeholders must be
notified of all events that might affect their status in a transaction.
 Event notification software works with the workflow
management software to monitor all e-commerce processes and
record all relevant events, including unexpected changes or
problem situatuions.

72.  Vital collaboration arrangements and trading services needed
by customers, suppliers, and other stakeholders to accomplish
e- commerce transactions.
 Customer focused e- business uses tools such ae e-mail, chat
systems and discussion groups to nurture online communities
of interest among employees and customers to enhance
customer service and build customer loyalty in e- commerce.

73.  Payment for the products and services purchased is an
obvious and vital set of processes in e- commerce transaction.
 E-commerce payment processes are also complex because of
the wide variety of debit and credit card alternatives, as well
as the financial institutions and intermediaries that may be a
part of the process.
 Therefore the variety of electronic payment systems have
evolved over time.

74.  Most e-commerce systems on the web involving business and
consumers (B2C) depends on credit card payment processes,
but many B2B e-commerce systems rely on more complex
payment processes based on the use of purchase orders.
 E- commerce typically use an electronic shopping cart
process, which enables customers to select products from
website catalog displays and put them temporarily in a virtual
shopping basket for later checkout and processing.

75.  Electronic fund transfer systems are a major form of
electronic payment systems in banking and retailing
industries.
 EFT uses variety of technologies to capture and process
money and credit transfer between banks and business and
their customers.
 Eg. ATM, PAYPAL, Internet bill payment

76.  Online purchase on the internet, makes credit card
information vulnerable to interception by network sniffers.
 Several basic security measures are being used to solve this
security problem.
1. Encrypt the data passing between customer and merchant
2. Encrypt the data passing between the customer and the
company authorizing the credit card transaction
3. Take sensitive information offline.