Business Information Systems

Business Information Systems

• Topic presented by Heri Kurniawan and Nabila Clydea Harahap, CSIM601280

Learning Objectives

• Explanation business processes
• Elucidation business information systems and key elements
• Description of e-commerce concepts
• Description of Transaction Process System, Management Information System, and Decision Support System

Business Defined

• Webster: buying and selling commodities, services with profit motive.
• Commerce and trade includes distribution or exchange of commodities.
• Industry focuses on large-scale manufacture of commodities.
• Enterprise offering desired products or services [Jeff Madura]
• Individuals/organizations seek profit through products/services satisfying needs [Sandie Ferriter]

The Nature of Business

• Provision of products (goods/services) for customers.
• Revenue is money/value from customers for products.
• Business incurs expenses to provide products.
• Most are for profit, but some operate as not-for-profit.
• The business environment includes economic, legal, cultural, and competitive factors

Business Environment Dynamics

• The firm interacts with key external stakeholders, exchanging information, money, labor, and materials with external elements like government, financial community, global community, suppliers, customers, labor unions, stockholders/owners and competitors.

Business Processes

• Process delivers key values to customers
• A collection of interdepartmental activities accomplishing an organization's missions, delivers value to customers
• A related group of steps (subprocesses) or activities, utilizing resources (including information) to create value for internal/external clients [Alter]

Business Processes Expanded

• The support activities include organizational infrastructure, human resources management, technology development, and procurement.
• The primary activities include inbound logistics, operations, outbound logistics, marketing and sales.
• Supply Chain and Value Chain components are buy, make, move, store and sell

Business IS

• Computer-Based Information Systems are applied in organizations, known as Business Information Systems.
• Business Information Systems (BIS) leverages IT for organizational, managerial needs [Petkov].
• Main Functions probably the main value of the business
• Supporting Functions include human resources, finance, inventory, infrastructure, information services

Business IS elements

• Include Electronic Commerce, Transaction Processing Systems, Management Information Systems, and Decision Support Systems

E-Commerce Overview

• Conducting business activities like distribution and sales electronically over computer networks.
• E-commerce facilitates electronic transactions between companies, consumers, and the public sector.
• Digital transmission of non-physical goods like films, music, or e-tickets.

E-Commerce Types

• Business-to-business (B2B): Participants are organizations
• Omnichannel: Strategy engaging customers across platforms.
• Business-to-consumer (B2C): Customers deal directly, avoiding intermediaries.
• Consumer-to-consumer (C2C): Electronic transactions facilitated by a third party.

E-Commerce B2B, B2C and C2C differences

• B2B value of sale is thousands or millions of dollars, sale process can take days or months, multiple decision makers are involved, with typically uniform product offering, complex buying process with negotiation options and business decision/need motivation
• B2C value of sale is tens or hundreds of dollars, sale process can take days or weeks, decision maker can be one or two people, with more customized product offering, less complex buying process with limited negotiation options and individual customer need/emotion motivation
• C2C value of sale is tens of dollars, sale process can take hours or days, decision maker can be one or two people, with a single product offering, less complex buying process with limited negotiation options and individual customer need/emotion motivation

E-Government and M-Commerce

• E-government: information and communications technology use, streamlines processes, enhances citizen-government relations.
• Government-to-citizen (G2C) ie. djponline.pajak.go.id
• Government-to-business (G2B) ie. e-katalog.lkpp.go.id
• Government-to-government (G2G) ie. Sistem informasi Keuangan Daerah (SIKD)
• Mobile commerce (m-commerce): Mobile devices like smartphones/tablets for order placement, business transactions.

Advantages of E-Commerce

• Reaching new customers.
• Reducing costs.
• Speeding the flow of information/goods.
• Improving accuracy.
• Enhancing customer service.

E-Commerce Challenges

• Must deal with consumer privacy concerns
• Identity theft, which can result in class actions lawsuits
• Overcoming consumer's lack of trust

Solutions to E-Commerce Challenges

• Companies investing in security technology, compliance with standards.
• Marketers demonstrating reliability, displaying accreditation, and ensuring website investment
• Shoppers purchasing from trusted sites, reviewing policies, using secure addresses, and virtual credit cards

Overcoming Global E-Commerce Challenges

• Requires navigating cultural differences, language barriers, different time zones, infrastructure limitations, currency issues, and varying laws.

E-Commerce, M-Commerce Applications

• Wholesale: Cost decrease through comparing suppliers, consolidating spending.
• Manufacturing: Formation of electronic exchange.
• Marketing: Use of internet data for specific targeting using tailored messaging.
• Market segmentation - specific targeting based on identified markets

Applications for E-Commerce and M Commerce Expanded

• Advertising through mobile ad networks, with cost structures like CPM, CPC, or CPA.
• Bartering is a means of gaining goods and services to reduce excess inventory, gain new customers, or avoid paying cash for necessary raw materials or services
• Retargeting directs personalized ads to recapture shoppers.
• Price Comparison allow for comparing prices/products on mobile apps.

E-Commerce, M-Commerce (3/3)

• Couponing via printable, digital, SMS formats
• Investment and Finance: Secure platform to monitor portfolios, view real-time stock quotes, track preferred stocks, and execute trades
• Banking involves savings, checking, loan accounts, transfers, deposits/bill payments.
• Online Personalized Shopping enable shopping consultations for various apparel and accessory items.

Strategies for E-Commerce and M-Commerce Success

• Define effective model/strategy which includes community, content and commerce.
• Defining web site functions and identifying all objectives
• Decide on key objectives of the site, provide all relative information, and include organization stance on social issues
• Planning and development of a site

E-Commerce and M-Commerce Success expanded

• Web Site Establishment decisions include in-house development or outsourcing.
• Storefront brokers act as intermediaries.
• Building traffic through domain registration, optimized search engine rankings
• Constantly monitor the site's traffic and the response using better understanding using personalization
• Implicit personalization – from web sessions (cookies)
• Explicit personalization – surveys, warranties, registration

Required Technology Infrastructure

• Storage capacity and computing power is needed for the web server.
• E-Commerce software must perform fundamental services
• Web server software packages Apache HTTP Server, Microsoft's Internet Information Services
• Must include high speed connections to a network, and the internet

Technology Infrastructure Expanded

• E-Commerce software requires catalog and product management tools, shopping cart facilities, and transaction processing.
• Mobile Commerce (M-commerce) requires improvements to ease purchasing and must improve network speeds and security, for the the transmission authentication

Electronic Payment Systems

• Payments made through electronic cash, wallets, and charge, debit/credit cards.
• Authentication includes digital certificates, certificate authority (CA), and biometric verification.
• Transport Layer Security (TLS) is the protocol, ensures privacy between applications, users on the Internet (encrypts data).
• Electronic cash - computerized money for e-commerce.

Transaction Processing Systems

• Transaction: any business-related exchange
• Transaction Processing Systems: consisting of people, procedures, software, databases, and equipment used to record transactions
• Provides valuable input to management information systems, decision support systems, and knowledge management systems

Traditional Methods Overview

• Batch Processing Systems: Transactions accumulated, prepared for single-unit processing.
• Delay exists between event, updating records.
• Payroll, billing done via batch processing.
• Online Transaction Processing (OLTP): Each transaction is processed rapidly and data is current.
• Essential for industries needing access to up-to-date data like airlines, stock firms, stock firms, and ticket agencies.

Transaction Processing Systems (TPS)

• Typically includes order processing systems, accounting systems, and purchasing systems
• The traditional transaction processing systems that support the purchasing business function include inventory control, purchase order processing, receiving, and accounts payable.

Effectiveness of TPS

• Better Relationship with Suppliers through internet marketplaces, allowing for companies to purchase discounted products
• Warehouse systems employ RFID technology to reduce labor hours/improve inventory for dramatic cost reduction
• Increased customer loyalty and monitor customer interactions
• Collaborative planning, forecasting, replenish ensure proper inventory levels.
• Configuration systems ensure products ordered meet customer objectives provide superior information gathering
• Track systems that allow determination customer to have shipping status

Transaction Processing Activities (1/3)

• Collect original data, check bad batches, edit data, process, correct data, storage, and production of reports

Transaction Processing Activities explained

• Data collection is capturing the data necessary to complete all processing for transactions, both manual and automated
• Data editing checks data for validity and completeness to detect any problems •

Transaction Processing Activities (3/3)

• Data correction reenters data that was not typed or scanned properly
• Data processing performs calculations and other data transformations related to business transactions
• Data storage updates one or more databases with new transactions
• Document production generates output records, documents, and reports

Workflow Systems

• Managing software directs tasks related to BPM.
• The system aligns with workflow, tracks process.
• The system helps with monitoring, routing, and imaging processes.

Enterprise Systems

• Information sharing among authorized users across business functions to support business management.
• Enterprise resource planning (ERP): Integrated programs managing company's business operations globally.

Benefits of ERP Systems

• Enhanced data access, improving decision-making.
• Enables integration of data to facilitate operational decision-making better and strengthens customer and supplier relationships
• Facilitates generation of new business opportunities
• A.I. provides the insights and partnerships to make appropriate decisions

Advantages of ERP (2/2)

• Elimination of Costly, Inflexible Legacy Systems enables the organization to eliminate dozens or even hundreds of separate systems
• Work processes based on industry best practices.
• Finance modules can have payment configurations, finance modules can reconfigure for customer payments (most effective process)
• Upgrade and Standardize Technology Infrastructure by decreasing multiple hardware platforms, operating systems, and databases
• Fewer needs standardization can reduce maintenance and supports costs

Leading ERP Systems

• Needs of multinational organizations differ from small, local organizations.
• No single "best" vendor.
• MIE Trak PRO is designed for manufacturers, allows management entire production cycle with customization.
• Plus & Minus is a integrated system suited to smaller organizations.

Customization for ERP Systems

• Needed to integrate with other business systems, add data, or adjust sizes.

Overcoming Enterprise Systems Implementation Challenges

• Addressing costs, managing change, customization, and user frustration.

Ways to prevent challenges

• Assigning executive, appointing independent resource, transition time allocation, and metrics to assess projects

Keys to success of Overcoming Enterprise Systems Implementation Challenges

• Defined scope, wary modifications, focus documentation, and workflow

Hosted Enterprise Software Model

• ERP/CRM software access via hosted versions from vendors at monthly cost.
• Premise, cloud-based, hybrid (on-premise and cloud based applications) available

Software Hosted Models Advantages and Disadvantages

• Lowers total cost of ownership, startup speed, risk and enable outsourced management
• Potential for vendor problems integrating hosted products

Management Information Systems (MIS)

• The system is consisting of people, procedures, software, databases, and equipment used to generate routine information for managers
• Focus on operational efficiency and is supported by TPS
• Generates reports of data and info
• Generates exception reports under circumstances

Management Information Systems (2/4)

• Systems are further divided into subsystems as functions
• Functional Information Systems including Transaction Processing Systems, Management Information System
• Functional & Holistic Approach is used
• Structural has vulnerabilities
• Some functions may not be identified or detected
• Results in fractured systems/integration difficulties

Functional Approach questions

• What are the main businesses of the organization?
• What are the objects of the main functions?
• What systems are needed for managing the organization?

Knowledge Management and Artificial Intelligence

• Topic presented by Pramitha Dwi Larasati & Widia Resti Fitriani

Learning Objectives

• Explain the types, structures, organization knowledge contents
• Discuss knowledge management
• Understanding Al
• Understanding Expert Systems & Machine Learning

Data, Information, and Knowledge

• Data are facts (Data = Attribute + Value)
• Information are facts organized for value (Information = Object + Attribute + Value)
• Knowledge is derived from information with experience (Knowledge = Object + Relation + Object)

How Knowledge works

• Comparison, connection, conversation to arrive to various outcomes including New Knowledge, Validated Knowledge and Rules and Procedures

The Importance of Knowledge

• Knowledge a critical resource.
• Enhances capability
• Gives competitive advantage, complex, difficult reproduce
• Employee has significance, knowledge about organization
• Fosters organizational learning environment

Organizational Knowledge types

• Explicit: Readily accessible, well-documented (objective, technical)
• Tacit: Resides within individuals (subjective, cognitive)

Organizational Structure

• Structured is organized resources such as Procedures.
• Unstructured is resources like email.

Content types

• Declarative is knowing facts.
• Linguistic interpretation is Understanding language.
• Reasoning is Knowing causes.
• Procedural is Knowing Methods.
• Key concepts include Know-Why, Know-What and Know-How

Basic Knowledge Processes

• Key components of a value-chain include market research to achieve IT and Training and test and evaluation

Knowledge Management Overview

• Natural processes (acquiring, validating, transferring) to better achieve goals.
• Creates value from assets.
• Provides best knowledge
• Processes are Creating, Capturing, Distributing and Sharing.

Various applications for Knowledge management

• QA Systems
• Word processing, publishing imaging data
• Collaboration via Al
• AI systems use Knowledge work

Essence of Knowledge Management

• Integrates human, social, and corporate (intellectual capital with processes)

Knowledge Management System (KMS)

• A well organized collection of programs, procedures, software
• Provides to organization knowledge with all users
• Different types of tools available such as CortexPro

Learning Organization Defined

• Senge: Organization who continually expand to creates desire
• Garvin: Creates insights and can reacquire knowledge
• Learning organization important
• Enhances Learning, Competitive strength, and Complex Adapting

What is Artificial Intelligence

• Replicates human brain functions
• First used in 1956

Common uses for A.I.

• Medical Diagnosis
• Natural Resources
• Mechanical Devices
• Computer Systems

Al system comprises people, procedures, hardware, software, data, and knowledge to simulate intelligence.

• Learning, Reason, and Self-correction

The Nature of Intelligence qualities

• The System approximates the way person sees, hears, feels objects
• Learns and be quickly reactive while also handling complexity to solve problems

The Major branches of A.I

• Robotics
• Vision processing systems
• Natural Language processing
• Expert-like Learning System

How expert systems work

• Decision-making system based on storing knowledge, inferences.
• The system is designed for complex needs
• Handle data effectively and must outperform individuals to remain effective
• Must be extremely accurate with precise reporting

Important Attributes or expert systems

• Data processing
• Decisions
• Provides assistance to experts
• Knowledge Base
• A rule as conditional If-then

Creating process for Al system

• Development engine are used to build the processes used in the Al
• The design is programmed and is tested

Inference engines

• Seek information and provide answers
• Strategies include Backward, or forward

Supporting systems overview

• Explanation system allows system to arrive to same results and also store base knowledge.
• Simplify usage for creators and are designed

Participants who developer or use Expert Systems

• Knowledge
• Engineers
• Domain Experts
• End-users

Artificial Neural Network

• ANN used to process functions of brain and undergo training to provide results

Visionary System uses

• Capture Visual Images
• Create Goggles
• Translate over other views

Key function of machine learning

• Learning to allow and improve systems
• This is processed
• Natural Process allows and functions for AI to understand

Machine learning process

• Styles recognize, restructure, analyze, problems accurate
• Data is set with feedback but is structured

Cyber and Data analytical systems

• Data analytics leverages organized models to provide strategic and profitability over data with increased security
• Insurance provide better protection to help for better analytics.

Management Systems

• Help provide analysis and insight
• Detection via medical
• Used in inspection for accidents

Natural Language Processing

• NLP is an application
• Allows translations and is applied to help in translation as spoken in a search.