Strategic Information Systems Definitions and context Week #1 pt. A.
Information Systems – Week 2
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BS3909 Week 2 1 Information Systems – Week 2 Last week – Introduction » What is an Information System? » Why use Information Systems? » Reading and Preparation for Case studies This week » Discussion of Assignment – any teams yet? » Strategic Role of Information Systems » Types of system and how they fit in » Case Studies
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Information Systems – Week 2. Last week – Introduction What is an Information System? Why use Information Systems? Reading and Preparation for Case studies This week Discussion of Assignment – any teams yet? Strategic Role of Information Systems Types of system and how they fit in - PowerPoint PPT Presentation
Transcript of Information Systems – Week 2
BS3909 Week 2 1
Information Systems – Week 2 Last week – Introduction
» What is an Information System?» Why use Information Systems?» Reading and Preparation for Case studies
This week» Discussion of Assignment – any teams yet?» Strategic Role of Information Systems» Types of system and how they fit in» Case Studies
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Strategic Role
“Understanding Information Technology (IT) is vital to every manager simply because IT is part of every manager's job. Managers in the 1990s must use IT to leverage their contributions to the organisation, and they must be knowledgeable about IT so that they can lead others to do the same.”
Professor Richard L. Nolan, Harvard Business School
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Strategic Role of Information Systems
Strategic Information System
Can Change: » Goals, Operations» Products, Services» Environment
To Gain Competitive Advantage
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Changing Concepts of IS
Time Time periodperiod
Conception of Conception of informationinformation
Information Information systemsystem PurposePurpose
1950-1960 Bureaucratic requirement Speed accounting & Paper processing
Electronic Accounting
1960s-1970s General purpose support MIS Speed general Reporting requirements
1970s-1980s Customized management support
DSS - ESS Improve, customize Decision making
1985-now Strategic resourceStrategic system
Promote survival and prosperity of organization
Competitive advantageBusiness foundation
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Business-level Strategy
Product Differentiation Focused Differentiation Data-mining Supply Chain Management Efficient Customer Response Enhancing Core Competencies
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Strategies Models IT technologies
Competitive forces modelNetwork economies
Core competency
Value chain analysis
IndustryCooperation vs competitionLicensingStandards
Firm SynergyCore competencies
Business Low costDifferentiationScope
Electronic transactionsCommunications networksInterorganizational systemsInformation partnerships
Knowledge systemsOrganizational systems
DataminingIt-based products / servicesInterorganizational systemsSupply chain managementEfficient customer response
Strategy Levels & IT
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THE FIRM TRADITIONAL COMPETITION
NEW MARKET ENTRANTS
SUPPLIERS CUSTOMERS
SUBSTITUTE PRODUCTS & SERVICES
Competitive Forces Model
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Countering Competitive Forces
Product differentiation Focused differentiation Link customers & suppliers Low-cost producer
Use the Internet!
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Countering Competitive Forces
Product Differentiation
Focused Differentiation
Links to Customers and Suppliers
Low-cost Producer
Low-cost Vendor
RBC Centura
Hyatt Hotels TravelWeb
Federal Express AVEX Electronics
E-Buyer
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DATA WORKERSDATA WORKERS
KIND OF SYSTEM GROUPS SERVEDKIND OF SYSTEM GROUPS SERVED
STRATEGIC LEVEL SENIOR MANAGERSSTRATEGIC LEVEL SENIOR MANAGERS
MANAGEMENT LEVEL MIDDLE MANAGERSMANAGEMENT LEVEL MIDDLE MANAGERS
OPERATIONAL OPERATIONAL OPERATIONAL OPERATIONAL LEVEL MANAGERS LEVEL MANAGERS
KNOWLEDGE LEVEL KNOWLEDGE & KNOWLEDGE LEVEL KNOWLEDGE &
SALES & MANUFACTURING FINANCE ACCOUNTING HUMANSALES & MANUFACTURING FINANCE ACCOUNTING HUMAN RESOURCESRESOURCESMARKETINGMARKETING
Types of Information System
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Major Types Of Systems
Executive Support Systems (ESS)
Management Information Systems (MIS)
Decision Support Systems (DSS)
Knowledge Work Systems (KWS)
Office Automation Systems (OAS)
Transaction Processing Systems (TPS or OLTP)
BS3909 Week 2 12TPS
Transaction Processing Systems (TPS)
Operational Level Inputs: Transactions, Events Processing: Updating Outputs: Detailed Reports Users: Operations Personnel
Example: Accounts PayableThe following examples are taken from Laudon & Laudon
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Typical TPS Applications
Major System Functions:
Sales Management Market Research Promotion Pricing New Products
Major System Applications:
Sales Order Info System Market Research System Pricing System
Sales & Marketing Systems
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Manufacturing & Production Systems
Major System Functions:
Scheduling Purchasing Shipping/Receiving Engineering Operations
Major System Applications:
Materials Resource Planning Systems Purchase Order Control Engineering Systems Quality Control
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Finance & Accounting Systems
Major System Functions:
Budgeting General Ledger Billing Cost Accounting
Major System Applications:
General Ledger Accounts Receivable/Payable Budgeting Funds Management
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Human Resource Systems
Major System Functions:
Personnel Records Benefits Compensation Labour Relations Training
Major System Applications:
Payroll Employee Records Benefit Systems Career Path Systems Personnel Training Systems
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Others – e.g. University
Major System Functions:
Admissions Grade Records Course Records Time-tabling Alumni relations
Major System Applications:
Registration System Student Transcript System Curriculum Class Control Scheduling Alumni Benefactor System
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Knowledge Work Systems (KWS)
KNOWLEDGE LEVEL Inputs: Design Specs Processing: Modelling Outputs: Designs, Graphics Users: Technical Staff
EXAMPLE: ENGINEERING WORK STATION
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Office Automation Systems (OAS)
Toward A “Paperless” Office Redesign Of Work Flow Integrated Software Ergonomic Design Bright, Cheerful Work Space
EXAMPLE: PRESENTATION GRAPHICS
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Management Information Systems (MIS)
MANAGEMENT LEVEL Inputs: High Volume Data Processing: Simple Models Outputs: Summary Reports Users: Middle Managers
EXAMPLE: ANNUAL BUDGETING
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Management Information Systems (MIS)
Structured & Semi-structured Decisions Report Control Oriented Past & Present Data Internal Orientation Lengthy Design Process
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MISMIS
MIS FILESMIS FILES
SALES DATA
UNIT PRODUCT COST
PRODUCT CHANGE DATA
EXPENSE DATA
MIS REPORTS
MANAGERSMANAGERS
TPSOrder Processing
System
Materials Resource
Planning System
General Ledger
System
ORDER FILE
PRODUCTION MASTER FILE
ACCOUNTING FILES
TPS Data for MIS Applications
Source: Laudon & Laudon
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Decision Support Systems (DSS)
MANAGEMENT LEVEL Inputs: Low Volume Data Processing: Interactive Outputs: Decision Analysis Users: Professionals, Staff
EXAMPLE: CONTRACT COST ANALYSIS
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Decision Support Systems (DSS)
Flexible, Adaptable, Quick User Controls Inputs/outputs No Professional Programming Supports Decision Process Sophisticated Modeling Tools
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Executive Support Systems (ESS)STRATEGIC LEVEL Inputs: Aggregate Data Processing: Interactive Outputs: Projections Users: Senior Managers
EXAMPLE: 5 YEAR OPERATING PLAN
TOP LEVEL MANAGEMENT Designed to the Individual Ties CEO to All Levels Very Expensive to Keep Up Extensive Support Staff
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ESS
TPSKWS
OAS
DSSMIS
Interrelationships Among Systems
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Goodsell Estate Agents
Problems identified:» Sales slipping » Rapid staff turnover» Not working as a team
What can be done?» Analysis of missed sales
– Are we not showing customers what they want?– Is it lack of expertise from rapid turnover?
» How can we share information among the team?– Could improve morale and cut attrition
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Zilkha Exploration A new approach to oil exploration
» Virtual company with low overheads Purchased oil exploration data, not leases
» Hired expert geologists to analyse mass of data» Analysed data using latest computer technology
Then bought leases and contracted other to drill» Had twice the hit rate for new oil fields than
conventional exploration procedures» Zilkha was bought out for a billion dollars in 1998
http://www.zilkha.com/zilkhaenergy/ http://www.zilkha.com/
