1. Management Information Systems (Business Objectives)
Lecture - 2
Management Information Systems (Business Objectives)
Mohammed Arif Mazumder
Sr. Lecturer
Daffodil International University
7th October, 2013 ( Fall – 2013)

2. Business Objectives of Information Systems
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
The Role of Information Systems in Business Today
Business Objectives of Information Systems
Operational excellence
New products, services, and business models
Customer and supplier intimacy
Improved decision making
Competitive advantage
Survival

3. Operational Excellence:
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
The Role of Information Systems in Business Today
Operational Excellence:
Improved efficiency results in higher profitability
Information systems and technologies help to improve higher levels of efficiency and productivity
Wal-Mart is the champion of combining information systems and best business practices to achieve operational efficiency—and $485 billion in sales in 2012
Wal-Mart is the most efficient store in the world as a result of digital links between its suppliers and stores

4. New products, services, and business models:
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
The Role of Information Systems in Business Today
New products, services, and business models:
Information systems and technologies enable firms to create new products, services, and business models
A business model includes how a company produces, delivers, and sells its products and services
The music industry has seen drastic changes in business models in recent years
Apple has been very successful at introducing new products and adopting a new business model

5. Customer and supplier intimacy:
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
The Role of Information Systems in Business Today
Customer and supplier intimacy:
Customers who are served well become repeat customers who purchase more
Close relationships with suppliers result in lower costs
The Mandarin Oriental in Manhattan uses information systems and technologies to foster an intimate relationship with its customers including keeping track of their preferences
JCPenney uses information systems to enhance its relationship with its supplier in Hong Kong
hotel

6. Improved decision making:
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
The Role of Information Systems in Business Today
Improved decision making:
A company’s bottom line can be hurt by managers being swamped with data that are neither timely nor helpful, forcing them to use guesswork
Real-time data have improved the ability of managers to make decisions
Verizon uses a Web-based digital dashboard to update managers with real-time data on customer complaints, network performance, and line outages
telecomunication

7. Competitive advantage:
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
The Role of Information Systems in Business Today
Competitive advantage:
Achieving the previously mentioned business objectives often leads to competitive advantage
Advantages over competitors include charging less for superior products, better performance, and better response to suppliers and customers
Dell Computer is one of the best examples of establishing competitive advantage as the company has continued to be profitable during a time when PC prices have been falling steadily

8. Businesses may need to invest in information systems out of necessity
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
The Role of Information Systems in Business Today
Survival:
Businesses may need to invest in information systems out of necessity
Necessity arises from keeping up with competitors, such as when Citibank introduced ATMs

9. What Is an Information System?
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
Perspectives on Information Systems and Information Technology
What Is an Information System?
Data are streams of raw facts representing events and occurrences
Information refers to data shaped into a meaningful and useful form
Information technology is the hardware and software a business uses to achieve its objectives
An information system consists of components that support decision making and control, and help with analysis, visualization, and product creation

10. What Is an Information System?
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
Perspectives on Information Systems and Information Technology
What Is an Information System?
Activities in an information system that produce information:
Input
Processing
Output
Feedback
Think of an information system you have experienced recently. Describe the inputs, processing, outputs, and feedback in the system.

11. Dimensions of Information Systems
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
It Isn’t Simply Technology: The Role of People and Organizations
Dimensions of Information Systems
Information systems literacy vs. computer literacy
Organizations; structure, processes, culture, and
politics
People; training, performance
Technology; computer hardware, software, and
communication

12. Information Systems Are More Than Computers
Essentials of Business Information Systems
Chapter 1 Business Information Systems in Your Career
It Isn’t Simply Technology: The Role of People and Organizations
Information Systems Are More Than Computers
Using information systems effectively requires an understanding of the organization, people, and information technology shaping the systems. An information system provides a solution to important business problems or challenges facing the firm.
Figure 1-3

13. How Businesses Use Information Systems
Chapter 2
How Businesses Use Information Systems

14. Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
STUDENT OBJECTIVES
Identify and describe the major features of a business that are important for understanding the role of information systems.
Describe the information systems supporting the major business functions: sales and marketing, manufacturing and production, finance and accounting, and human resources.
Evaluate the role played by systems serving the various levels of management in a business and their relationship to each other.

15. Assess the role of the information systems function in a business.
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
STUDENT OBJECTIVES (Continued)
Explain how enterprise applications and intranets promote business process integration and improve organizational performance.
Assess the role of the information systems function in a business.

16. Organizing a Business: Basic Business Functions
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Components of a Business
A business is a formal organization that makes products or provides a service in order to make a profit.
Organizing a Business: Basic Business Functions
Four basic business functions: manufacturing and production, sales and marketing, finance and accounting, and human resources
Notice how this opinion is different from McLeod and Schell.

17. How are raw materials transformed into products?
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Components of a Business
Business Processes
What tasks does each employee perform, in what order, and on what schedule?
Examples:
How are raw materials transformed into products?
How are orders fulfilled?
How are bills paid?
How are products marketed?
How are employees hired?

18. The Order Fulfillment Process
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Components of a Business
The Order Fulfillment Process
Fulfilling a customer order involves a complex set of steps that requires the close coordination of the sales, accounting, and manufacturing functions.
Figure 2-2

19. The Role of Information Systems in a Business
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Components of a Business
The Role of Information Systems in a Business
Information systems relate to the following business objectives:
Achieving operational excellence
Developing new products and services
Attaining customer intimacy and service
Improving decision making
Promoting competitive advantage
Ensuring survival

20. Systems from a Functional Perspective
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Types of Business Information Systems
Systems from a Functional Perspective
Sales and marketing systems
Manufacturing and production systems
Finance and accounting systems
Human resources systems

21. Systems from a Functional Perspective
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Types of Business Information Systems
Systems from a Functional Perspective
Sales and marketing systems

22. Systems from a Functional Perspective
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Types of Business Information Systems
Systems from a Functional Perspective
Manufacturing and production systems

23. Systems from a Functional Perspective
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Types of Business Information Systems
Systems from a Functional Perspective
Finance and accounting systems

24. Systems from a Functional Perspective
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Types of Business Information Systems
Systems from a Functional Perspective
Human resources systems

25. Systems from a Constituency Perspective
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Types of Business Information Systems
Systems from a Constituency Perspective
Each functional area has three distinct management levels :senior, middle, and operational.
Each level has different information requirements. There are four different types of systems
to help out.
Transaction processing systems (TPS)
Management information systems (MIS) and decision-support systems (DSS)
Executive support systems (ESS)

26. Interrelationships Among Systems
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Types of Business Information Systems
Interrelationships Among Systems
The various types of systems in the organization have interdependencies. TPS are major producers of information that is required by many other systems in the firm, which, in turn, produce information for other systems. These different types of systems have been loosely coupled in most organizations.
Figure 2-13

27. Systems from a Constituency Perspective
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Types of Business Information Systems
Systems from a Constituency Perspective
Transaction processing systems (TPS)
The operational level of the organization is responsible for daily operations.
The information systems used in this level of the organization are
Transaction processing systems(TPS) .
Characteristics of TPS:
1. Record the routine transactions that take place in everyday operations.
2. Very rich with data and the data is very detailed.
3. Typically helps with structured decisions.
4. Relies heavily on Data Management Technology (database technology).

28. Systems from a Constituency Perspective
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Types of Business Information Systems
Systems from a Constituency Perspective
Management information systems (MIS) and decision-support systems (DSS)
Think about the functions of managers that you may have learned about in other classes:
directing, controlling, communicating, planning, and decision-making. Each manager
takes on these roles countless times a day.
Management Information Systems (MIS) require information on a
periodic basis instead of on a daily recurring basis like those using a
transaction processing system.

29. Systems from a Constituency Perspective
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Systems from a Constituency Perspective
Management information systems (MIS) and decision-support systems (DSS)
The MIS will draw data from the transaction processing system to help managers answer
Structured questions such as:
“How much more sugar must we purchase if we increase production from5,000 bars to
7,000?”

30. Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems

31. Enterprise Applications
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise
Enterprise Applications
Enterprise applications are systems that span functional areas and automate processes for multiple business functions and organizational areas; they include:
Enterprise systems
Supply chain management systems
Customer relationship management systems
Knowledge management systems

32. Also known as enterprise resource planning (ERP) systems
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise
Enterprise Systems
Also known as enterprise resource planning (ERP) systems
Integrate key business processes of an entire firm into a single system enabling managers of large firms to assemble an overall view of operations

33. Supply Chain Management Systems
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise
Supply Chain Management Systems
Aim to move the correct amount of product from source to point of consumption as quickly as possible and at the lowest cost
Used by firms to manage relationships with suppliers, purchasing firms, distributors, and logistics companies through shared information about orders, production, inventory levels, and more
Automate the flow of information across organizational boundaries

34. Customer Relationship Management Systems
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise
Customer Relationship Management Systems
Coordinate all of the business processes that deal with customers to optimize revenue and customer satisfaction, and increase sales
Sales, marketing, and service record data from multiple communication channels can be combined
Saab implemented CRM applications from Siebel Systems to achieve a 360º view of customers, resulting in a greater follow-up rate on sales leads and increased customer satisfaction

35. Knowledge Management Systems
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise
Knowledge Management Systems
Intangible knowledge assets provide value to firms
Knowledge management systems manage the capture, storage, distribution, and application of knowledge so that it can be leveraged for strategic benefit

36. Intranets and Extranets
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise
Intranets and Extranets
Technology platforms that increase integration and expedite the flow of information
Intranets: internal networks based on Internet standards
Extranets: intranets that are extended for authorized use outside the company
Intranets often utilize a portal
Extranets facilitate collaboration

37. E-Business, E-Commerce, and E-Government
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
Systems That Span the Enterprise
E-Business, E-Commerce, and E-Government
E-business refers to the use of digital technology and the Internet to drive major business processes
E-commerce is a subset of E-Business that involves buying and selling goods and services through the Internet.
E-government refers to using Internet technology to deliver information and services to citizens, employees, and businesses

38. The Information Systems Department
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
The Information System’s Function in Business
The Information Systems Department
Programmers
Systems analysts
Information systems managers
Chief information officer (CIO)
End users

39. Organizing the Information Systems Function
Essentials of Business Information Systems
Chapter 2 E-Business: How Businesses Use Information Systems
The Information System’s Function in Business
Organizing the Information Systems Function
Small companies often rely on a single person for information technology services rather than an information systems department
Some large firms with IS departments decentralize them so that each functional area of the business has its own information systems
Other large firms may depend on a central department that makes technology decisions for the entire company