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Management I nformation
Systems - Class Note #2
Prof. Yuan-Shyi Peter Chiu
Feb. 2012
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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
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Fig 2.1: Types of Information Systems
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Different 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 systems
2.1
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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)
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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 organizations
operational level.
TPS Transaction Processing
Systems
Six Major Types of Systems
2.1
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Fig 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. 2-4 ( p.43 )
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TPS Transaction 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 Transaction 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 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 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 Systems
2.1
Example: Annual budgeting
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Structured and semi-structured decisions

Report control oriented

Past and present data

Internal orientation

MIS
2.1
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TPS DATA FOR MIS APPLICATIONS
Fig 2-5: How management information systems obtain their data
the from the organizations 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 Systems
2.1
Example: Contract 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 & 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 & DSS
2.1
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Information system at the
organizations strategic level designed
to address unstructured decision
making through advanced graphics
and communications.
ESS Executive Support Systems
Six Major Types of Systems
2.1

Example: 5-year operating plan
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Top level management

Designed to the individual

Ties CEO to all levels

Very expensive to keep up

Extensive support staff
ESS
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
ESS
2.1
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Characteristics of Different Types
of Information Systems
Information inputs
Processing
Information outputs
Users

See Table 2-1 ( p.41 )
2.1
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Fig 2-9: Interrelationships among systems
2.2 Systems from a Functional Perspective
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SALES & MARKETING SYSTEMS
MANUFACTURING & PRODUCTION
SYSTEMS
FINANCE & ACCOUNTING SYSTEMS
HUMAN RESOURCES SYSTEMS
2.2 Systems from a Functional Perspective
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2.2 Systems from a Functional Perspective
Major functions of systems:
Sales management, market research, promotion,
pricing, new products

Major application systems:
Sales order info system, market research system,
pricing system

Sales and Marketing Systems
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Sales and Marketing Systems
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2.2 Systems from a Functional Perspective
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

Manufacturing and Production Systems
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Manufacturing and Production Systems
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2.2 Systems from a Functional Perspective
Major functions of systems:
Budgeting, general ledger, billing, cost
accounting

Major application systems:
General ledger, accounts receivable, accounts
payable, budgeting, funds management systems

Financing and Accounting Systems
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Financing and Accounting Systems
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2.2 Systems from a Functional Perspective
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

Human Resource Systems
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Human Resource Systems
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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
knowledgesets of activities
Unique ways to coordinate work, information, and
knowledge
Ways in which management chooses to coordinate
work
2.3 Business Processes and
Information Systems
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Manufacturing and production: Assembling
product, checking quality, producing bills of
materials

Sales and marketing: I dentifying customers,
creating customer awareness, selling

Examples of Business Processes
2.3 Business Processes and Information Systems
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Cross-Functional Business Processes
2.3 Business Processes and Information Systems
Fig. 2-12 The Order Fulfillment Process
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I nformation systems help organizations

Achieve great efficiencies by automating
parts of processes
Rethink and streamline processes
2.3 Business Processes and Information Systems
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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)
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, 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
2.3 How Information Systems Facilitate
Supply Chain Management
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2.3 Collaborative Commerce
Figure 2-15
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2.3 Enterprise 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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