Business Information Systems Lecture 3 Fall 24 PDF

Business Information Systems Dr. Rashed Refaat ‫ راشد رفعت‬.‫د‬ [email protected] [email protected] [email protected] EL 211 / ELE112: Introduction to Information Systems Dr. Rashed Refaat ‫ راشد رفعت‬.‫د‬ Lecture 03  E-Business: How Bus...

Business Information Systems Dr. Rashed Refaat ‫ راشد رفعت‬.‫د‬ [email protected] [email protected] [email protected] EL 211 / ELE112: Introduction to Information Systems Dr. Rashed Refaat ‫ راشد رفعت‬.‫د‬ Lecture 03  E-Business: How Businesses Use Information Systems 2.1 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Components of a Business Business: 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 Human resources 2.5 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Components of a Business The Four Major Functions of a Business Every business, regardless of its size, must perform four functions to succeed. It must produce the product or service; market and sell the product; keep track of accounting and financial transactions; and perform basic human resources tasks, such as hiring and retaining employees. Figure 2-1 2.6 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Components of a Business Organizing a Business: Basic Business Functions Five basic business entities: Suppliers Customers Employees Invoices/payments Products and services 2.7 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Components of a Business Business Processes Logically related set of tasks that define how specific business tasks are performed The tasks each employee performs, in what order, and on what schedule E.g., Steps in hiring an employee Some processes tied to functional area Sales and marketing: identifying customers Some processes are cross-functional Fulfilling customer order 2.8 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Components of a Business Managing a Business and Firm Hierarchies Firms coordinate work of employees by developing hierarchy in which authority is concentrated at top.  Senior management  Middle management  Operational management  Knowledge workers  Data workers  Production or service workers Each group has different needs for information. 2.10 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Components of a Business Levels in a Firm Business organizations are hierarchies consisting of three principal levels: senior management, middle management, and operational management. Information systems serve each of these levels. Scientists and knowledge workers often work with middle management. Figure 2-3 2.11 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Components of a Business The Business Environment Global environment factors Immediate environment factors Technology and science Customers Economy Suppliers Politics Competitors International change Regulations Stockholders 2.12 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Components of a Business The Business Environment To be successful, an organization must constantly monitor and respond to—or even anticipate—developments in its environment. A firm’s environment includes specific groups with which the business must deal directly, such as customers, suppliers, and competitors as well as the broader general environment, including socioeconomic trends, political conditions, technological innovations, and global events. Figure 2-4 2.13 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Components of a Business The Role of Information Systems in a Business Firms invest in information systems in order to: 1. Achieve operational excellence. 2. Develop new products and services. 3. Attain customer intimacy and service. 4. Improve decision making. 5. Promote competitive advantage. 6. Ensure survival. 2.14 Copyright © Pearson Education, Inc. publishing as Prentice Hall  An information system is a conceptual system that enables managers to control and monitor a firm’s physical systems used to transform input resources into output resources 15 2.15 Copyright © Pearson Education, Inc. publishing as Prentice Hall  MANAGERS AS INFORMATION SYSTEM USERS Managers exist at various managerial levels and within various business areas of the firm What level an IS is developed for influences how it operates The 3 primary management levels are : 1. Strategic planning level 2. Management control level 3. Operational control level 16 2.16 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Management Level Can Influence Both the Source and Presentation Form of lnfonnation Environmental Management control level Operational control level Internal A. Influence on information source Strategic planning level Summary Management control level Operational control level Detail B. Influence on information form 17 2.17 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Types of Business Information Systems Systems For Different Levels of Management Transaction processing systems: Keep track of basic activities and transactions of organization (e.g., sales, receipts, cash deposits, payroll, credit decisions, flow of materials in a factory). Management information systems and decision- support systems: Help with monitoring, controlling, decision making, and administrative activities. Executive support systems: Help address strategic issues and long-term trends, both in firm and in external environment. 2.19 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Types of Business Information Systems Transaction processing systems: Serve operational managers. Principal purpose is to answer routine questions and to track the flow of transactions through the organization. E.g., inventory questions, granting credit to customer Monitor status of internal operations and firm’s relationship with external environment. Major producers of information for other systems. Highly central to business operations and functioning. 2.20 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Figure 1.8 A Model of a Transaction Processing System Environment Data -+ __. lr lor ma Management ,. t io n Transacbon processing , tern I Input I Dutput phySleat Transtorm physical resources resources Environment 21 2.21 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Types of Business Information Systems Management information systems: Provide middle managers with reports on firm’s performance. To monitor firm and help predict future performance. Summarize and report on basic operations using data from TPS. Provide weekly, monthly, annual results, but may enable drilling down into daily or hourly data. Typically not very flexible systems with little analytic capability. 2.23 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Figure 1.9 An MIS Model Environment Data --- In fo rm Organizational problem ati o solvers 1' 1' _ I I I I n Report Mathematical writing models software Management information..._ s yste 1--: ----- 1 - m I Environment 2.24 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Types of Business Information Systems Executive support systems (ESS): Serve senior managers. Address strategic issues and long-term trends. E.g., what products should we make in five years? Address nonroutine decision making. Provide generalized computing capacity that can be applied to changing array of problems. Draw summarized information from MIS, DSS, and data from external events. Typically use portal with Web interface to present content. 2.28 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Types of Business Information Systems Systems That Span the Enterprise Enterprise applications Systems that span functional areas, focus on executing business processes across the firm, and include all levels of management. Enterprise systems Supply chain management systems Customer relationship management systems Knowledge management systems 2.30 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Systems That Span the Enterprise Enterprise Systems Integrate data from key business processes into single system. Speed communication of information throughout firm. Enable greater flexibility in responding to customer requests, greater accuracy in order fulfillment. Enable managers of large firms to assemble overall view of operations. companies use ERP to eliminate redundancies and inefficiencies in its disparate systems. 2.32 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management Information Systems Chapter 2 E-Business: How Businesses Use Information Systems Systems That Span the Enterprise Internet, Intranets and Extranets Technology platforms that increase integration and expedite the flow of information Intranets: Internal networks based on Internet standards Typically utilize a portal Extranets: Intranets extended for authorized use outside the company for partners, customers Facilitate collaboration 2.36 Copyright © Pearson Education, Inc. publishing as Prentice Hall  Essentials of Management 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: Use of digital technology and Internet to drive major business processes E-commerce: Subset of e-business Buying and selling goods and services through Internet E-government: Using Internet technology to deliver information and services to citizens, employees, and businesses 2.37 Copyright © Pearson Education, Inc. publishing as Prentice Hall