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Information Systems & Databases

Information Systems & Databases. Information Systems & Databases SYSTEMS DEVELOPMENT ENVIRONMENT. Outline for Today What are Information Systems? Information Systems in Organizations Business Processes Types of Business Information System Systems from a Functional Perspective.

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Information Systems & Databases

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  1. Information Systems &Databases Information Systems &Databases SYSTEMS DEVELOPMENT ENVIRONMENT • Outline forToday • What are InformationSystems? • Information Systems inOrganizations • BusinessProcesses • Types of Business InformationSystem • Systems from a FunctionalPerspective • What isInformation? • The flow of information in an organization and between organizations, encompassing the information the businesscreates,usesandstores • Management ofInformation • Information is handled and recorded according to various techniques: • informalideas • natural language (written orspoken) • drawings,diagrams, • numbers • Codes

  2. Information Systems &Databases • What is InformationTechnology? • Any form of technology used by people to handleinformation • Computers • Hardware /software • Resources: • Computerhardware • Software • Networks • Databases • Examples of InformationSystems • Payroll system: handles payments of employees in an organization • Sales order processing system: handles supply/orders ofproducts • Project planning and control system: handles time/resource requirements of activities related to a project • Geographic information system: handles geo-spatial information (maps, satellite images, statistical data, etc. associated with a given geographicarea)

  3. Information Systems &Databases • Information Systems inBusiness • An organisation must connect each functional area and each management level to oneanother. • Data input to the system in manufacturing must be madeavailableto sales,accounting,andshipping. • Managers in the human resources department must have access to appropriate information regardless of itsorigin. • Information integration is thekey. • As we go through this section, we’ll look at the types of information systems organisation’s use to bring it alltogether. • Business Processes & InformationSystems • WhatisaBusinessProcess? • A business process is a logically related set of activities thatdefinehowspecificbusinesstasks areperformed. • Business processes are the ways in which organizations coordinate and organize work activities, information, and knowledge to produce their valuable products or services. • Businesses can be seen as collection of business processes. May be tied to functional area or becross- functional • Business Processes & InformationSystems • How are Business Processes related to information systems? • Howwellabusinessperformsdependsonhowwellits business processes are designed andcoordinated. • Well-designed business processes can be a source of competitive strength for a company if it can use the processesto innovateorperformbetterthanitsrivals. • Conversely, poorly designed or executed business processescanbea liabilityiftheyare basedonoutdated ways of working and impede responsiveness or efficiency.

  4. Information Systems &Databases • Business ProcessExamples • Developing a newproduct • Generating and fulfilling anorder • Hiringstaff • Ordering a burger inMacDonald's • Applying for a driverslicense • Whatelse? Examples of FunctionalBusiness Processes • How Information Technology Improves Business Processes • Information technology enhances business processes by: • Increasing efficiency of existingprocesses • Automating steps that weremanual • Enabling entirely newprocesses • Change flow ofinformation • Replace sequential steps with parallelsteps • Eliminate delays in decisionmaking • Support new businessmodels

  5. Information Systems &Databases • Decision-Making Levels of an Organization • How do systems serve the different management groups in a business? • There is no one single information system that will satisfy all of the needs of anorganisation. asesFionaRedmond Comparison of Decision-MakingLevels • Types of InformationSystems • Executive-Support Systems(ESS) • Decision-Support Systems(DSS) • Management Information Systems(MIS) • Transaction Processing Systems(TPS)

  6. Information Systems &Databases Types of Systems that span the Enterprise • OperationalLevel • Day-to-day business processes / dailyoperations • Interactions withcustomers • Information systems used to: • Automate repetitivetasks • Improveefficiency • Decisions: • Structured • Recurring • Can often be automated usingIS • Transaction Processing System(TPS) • Transaction processingsystems: • Serve operational managers andstaff • Perform and record daily routine transactions necessary to conductbusiness • Examples: sale of a stock item, receipt of a payment from a customer, purchase, payroll,shipping • Allow managers to monitor status of operations and relations with externalenvironment • Serve predefined, structured goals and decisionmaking • The data are very detailed at thislevel. • The best TPS will be integrated throughout the organisation to supply useful information to those who need it when theyneed it.

  7. Information Systems &Databases A payrollTPS A TPS for payroll processing captures employeepayment transaction data (such as a time card). System outputs include online and hard- copy reports for management and employee paychecks. • TypicalQuestions • People using transaction processing systems usually need information to help them answer routine questions suchas: • How many X did we produceyesterday? • How much X do we have on hand for today’s production run? • How many stores are actually stockingX? • Where is X located inside thestores? (X being theproduct)s • ManagerialLevel • Functionalmanagers • Monitoring and controlling operational-levelactivities • Providing information to executivelevel • Midlevelmanagers • Focus on effectively utilizing and deployingresources • Goal of achieving strategicobjectives • Managers’decisions • Semistructured • Contained within businessfunction • Moderatelycomplex • Time horizon of few days to fewmonths

  8. Information Systems &Databases • Management Information Systems - MIS • Management InformationSystems • Serve middlemanagement • designed to produce information on a periodicbasis • Provide reports on firm’s current performance, based on data fromTPS • Provide answers to routine questions with predefined procedure for answeringthem • Typicallyhavelittleanalyticcapability How MIS Obtain Their Data fromthe Organization’sTPS In the system illustrated by this diagram, three TPS supply summarized transaction data to the MIS reporting system at the end of the time period. Managers gain access to the organizational data through the MIS, which provides them with the appropriate reports. • TypicalQuestions • People using management information systems usually need information to help them answer questions suchas: • Is production is higher or lower than the targetedrate? • Is the company over or under theirbudgets? • They also need to know about trends instead of straight numbers. The questions they may ask of the system wouldbe: • How far behind in production are we for thisquarter? • How many more workers would we need if we increased production by10,000ofXperquarter? • If we do adopt X, what positions are open for the 25 excess workers and what skills do they possess that the company can useelsewhere?

  9. Information Systems &Databases • Decision SupportSystems • Decision supportsystems • Serve middlemanagement • Supportnon-routinedecisionmaking/What-ifanalyses • Example: What is the impact on production schedule if December salesdoubled? • Analyze results for hypotheticalchanges • May use external information as well as internal TPS / MIS data • Model drivenDSS • Voyage-estimatingsystems Voyage-Estimating Decision SupportSystem This DSS operates on a powerful PC. It is used daily by managers who must develop bids on shippingcontracts. • TypicalQuestions • ThesalesandmarketingmanagementwoulduseaDSS to answer a semi structured question such as: “What price should we charge for X so that we can maximize our profits, minimize our costs, and still remain competitive?” • The manager in charge of the manufacturing division could determine the best answer to this semi structured question: “How does the change in the size and packaging of X affect the other products we produce, not just in shipping, but also on the display shelf at the conveniencestore?”

  10. Information Systems &Databases • ExecutiveLevel • The president, CEO, vice presidents, board of directors • Decisions • Long-term strategicissues • Complex and nonroutineproblems • Unstructureddecisions • Long-termramifications • Executive InformationSystems • AKA Executive SupportSystem • Support seniormanagement • Address non-routinedecisions • Requiring judgment, evaluation, andinsight • Incorporate data about external events (e.g. new tax laws or competitors) as well as summarized information from internal MIS andDSS • Example:Digitaldashboardwithreal-timeviewoffirm’s financial performance: working capital, accounts receivable, accounts payable, cash flow, andinventory Model of a typicalExecutive InformationSystem 10

  11. Information Systems &Databases • Before InformationSystems • Managers received periodic printed reports that gave them lots of data, but often didn’t supply information that they could utilize to make timely decisions. Planning was sometimes a wasted effort because the information the managers needed just wasn’t there when they neededit. • For example: If there was a problem getting a shipment out to the store in Sandymount, the shipping manager may not have known about it until a customer cancelled her account six months later. The human resources department manager would likely not be able to find out about new job opportunities in a different part of the company until after the workers were laid off and had found other employment. Worse yet, production might have to stop the assembly lines because accounting hadn’t purchased enough supplies to cover the increase in the number of X rolling off theline. • Before InformationSystems • With the integration of information systems up and down the management levels, and throughout the corporation, managers can often get needed information in a real-time mode. • The data are kept online, the system can gather the precise information managers need to make a decision, and the information can be cross integrated into all departments of thecompany. • All divisions in the company can see what’s going on throughout the corporation. Information can be passed from department to department so that they are all working “on the samepage.” VideoCase How Businesses Use InformationSystems How FedExWorks http://www.youtube.com/watch?v=iYzQ7JSBIGU 11

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