CHAPTER 8 Organizational Information Systems

CHAPTER OUTLINE  Transaction Processing Systems (TPS)  Functional Area Information Systems (FAIS)  Enterprise Resource Planning (ERP) 2

Type of Information Systems: Inside an Organization 3

Transaction Processing Systems Provides Operational level support Goal: Increasing efficiency through automation Examples: Payroll Sales and ordering Inventory Purchasing, receiving, shipping Accounts payable and receivable 4

How Are TPS Related to Other Information Systems 5

Architecture of a TPS 6

Transaction Processing Mode  Batch Processing Process a batch of transactions at a time Cost/efficient but data will not be up-to-date between processing cycles  Real Time (Online) Processing Each transaction is processed as soon as it occurs Keeps data up-to-date; better service at a higher cost than batch processing 7

Functional Area Information Systems 8 FAIS support lower- and middle-level managerial decision-making

FAIS Reports Routine reports – produced automatically on a fixed schedule Ad hoc reports – produced on demand to answer a specific question Drill-down reports Key-indicator reports Comparative reports Exception reports – highlights situations where data is out of normal range (e.g. Monthly Late Shipments) 9

Enterprise Resource Planning (ERP) Systems Legacy Systems were developed piece-meal within each functional area 10

Problems with information silos 11

ERP Systems (cont.) 12

ERP Implementation Typically bought from an ERP vendor, e.g., SAP, Oracle, and PeopleSoft (now part of Oracle) Expensive customizations usually required May require Business Process Management (BPM) Rethinking and redesign of business processes in order to achieve dramatic improvements in performance (e.g. quality, cycle time, cost) 13

Business Process Management A business process is a set of related steps or procedures designed to produce a specific outcome. 14