1 Information systems for the firm Main classification (Source : Laudon & Laudon, Prentice- Hall, 2000)

2 Four levels of applications of I.S. in the firm : Strategy level : I.S. for top executives Management level : I.S. for middle management “Knowledge” level : I.S. for office employees Operations level : I.S. for production, sales, marketing, accounting, and H.R. functions

3 Operations level : I.S. to treat day to day transactions

4 Example with Sales For one sale we want to have all the following information : –which product range –which product –which month –which region of the World –which type of client (large account, national account, small account…) –which salesperson made the sale –the sales figure –the delivery choice –the payment facilities –etc. (the number of visits before the sale…)

5 “Knowledge” level : two types of information system Systems for office basic work : –Word processing –Document and image creation –Electronic calendar (Outlook…) Systems for intellectual work : –Engineering work stations and softwares –Management work stations and softwares

6 A peep into an engineering office Up until the late 70 ’s engineers worked only on drawing boards (large slanted tables) In the 80 ’s the CAD/CAM systems were adopted in all large manufacturing firms On « work stations » Renault & Dassault were innovators in the field : the program Catia...

7 Management level : two types of information system Management information systems : –Sales management –Stock control –Annual budgeting –Capital investment control –Carriers evolution management Systems to assist middle mgt. decision process : –Sales analysis by region –Production planning –Costs analysis and costs control –Price analysis and profitability analysis

8 Strategy level : I.S. for top executives Five year sales forecast Five year operation planning Five year budget forecast Profitability forecast Human resources planning

9 IS for top executives Computer Aided Decision softwares (in French : Système d ’Information et d ’Aide à la Décision SIAD) In the near future they will have more such softwares : –to sift through large amounts of information –to find signals –to find patterns The Darpa Tias program will lead to such softwares (see also Datops)

10 Features and users of I.S.

11 Evolution of Information Systems Information Systems entered the firms in the sixties : –They were first concerned with accounting, and with production control Later, in the eighties and nineties, they entered all the other functions of the firm (from bottom up) : –I.S. can increase tremendously the firm productivity –Information is now considered a “product” of strategic value, whereas a generation ago it was only “red tape”

12 An example : When it was clearly realized that gaining a new client was about 5 times more expensive than keeping an existing one, and that I.S. provided new means to analyze and retain clients, C.R.M. (Client Relationship Management) was born. “The most efficient selling action is to treat as well as possible your existing clients” They are not only your best future clients, they also are your best salespeople, and the beauty : they are free In order to do that you have to know them very well, and customize your relationship with them.