C2- How Businesses Use Information Systems

Systems from a functional perspective

• Sales and marketing systems• Manufacturing and production systems• Finance and accounting systems• Human resources systems

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Types of Information Systems

Three main categories of IS

Serves at different organizational level1. Operational-level systems: support operational

managers, keeping track of the elementary activities and transactions

2. Management-level systems: serve the monitoring, controlling, decision-making, and administrative activities

3. Strategic-level systems: help senior management tackle and address strategic issues

The Order Fulfillment Process

Figure 2-1

Fulfilling a customer order involves a complex set of steps that requires the close coordination of the sales, accounting, and manufacturing functions.

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Business Processes and IS

A Symbolic Representation for a Payroll TPS

Functional Systems

Functional Systems …

Systems from a constituency perspective

– Transaction processing systems (TPS)– (MIS) and decision-support systems (DSS)– Executive support systems (ESS)

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Interrelationships Among Systems

Figure 2-10

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 are loosely coupled in most business firms, but increasingly firms are using new technologies to integrate information that resides in many different systems.

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Enterprise applications

• Designed to support organization-wide process of coordination and integration

• Consists of:– Enterprise systems– Supply chain management systems– Customer relationship management systems– Knowledge management systems

Figure 2-11

Enterprise applications automate processes that span multiple business functions and organizational levels and may extend outside the organization.

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Enterprise Application Architecture

WELCOME TO ENTERPRISE APPLICATIONS

INTEGRATING FUNCTIONS AND BUSINESS PROCESSEs

Enterprise Systems

• Also known as enterprise resource planning (ERP) systems

• Provide a single information system for organization-wide coordination and integration of key business processes

• Allows flow of information throughout the firm so that it can be shared by business processes in different functional areas

Figure 2-12 Enterprise Systems

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Supply Chain Management (SCM)

• The close linkage and coordination of activities involved in buying, making, and moving a product

• SCM integrates business processes to speed information, product, and fund flows up and down a supply chain

• Reduces time, redundant effort, and inventory costs

Customer Relationship Management (CRM)

• Business and technology discipline for managing customer relationships to optimize revenue, profitability, customer satisfaction, and customer retention

Applications of a CRM system

• Capture and integrate customer data from all over the organization

• Consolidate and analyze the data • Distribute results to various systems and

customer touch points across the enterprise • Provide a single touch point for the customer