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OUTCOME 1

1.1 INFORMATION NEEDS1.2 FUNCTIONAL AREAS OF AN ORGANIZATION

INFORMATION SYSTEMS

INFORMATION NEEDS WITHIN DIFFERENT

FUNCTIONAL AREAS

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Data

Data are facts, events, transactions and so on

which have been recorded. They are the input

raw materials from which information is

produced.

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Information

Information is data that has been processed in

such a way as to be meaningful to the person

who receives it.

Note the two words highlighted - "processed"

and "meaningful".

Aids in decision making

Reducing uncertainty and increasing the

knowledge level of the decision-maker

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Information

Relevant information is information which:

Increase knowledge

Reduces uncertainty

Is usable for the intended purpose

The type of information required is depend on many factors

including

The level of management

The task in hand

Confidentiality

Urgency

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Characteristic of Good Information

1. relevantfor its purpose

2. sufficiently accuratefor its purpose

3. completeenough for the problem

4. from a source in which the user has confidence5. communicated to the right person

6. communicated in timefor its purpose

7. that which contains the right level of detail

8. communicated by an appropriate channel of communication

9. that which is understandableby the user

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Sources of Information

If the information is collected by the organization itself

internally then the information is called INTERNAL

INFORMATION.

If the information required for decision making is taken from

outside then it is called EXTERNAL INFORMATION.

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Internal Information Companies collect information

in the everyday course of

conducting business.

Orders are received and

filed

Costs are recorded

Sales peoples reports are

submitted,

Engineering reports are

made

Sales reports by region

Sales by customer

Sales by product

Market prospects and

reports

Customer complaints

Marketing research reports All these are but a few o f the

many sources of information,

collected by companies for

other purposes, that they are

useful for the managers.

These are the internal

secondary sources of

information.

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Internal Information

Accounts department

Procedures manual

Management accountsbalance sheets

Financial data

Accounting policies

Tax details

Working capital

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Production and operations

Operations data Efficiency and capacity details

Process flow charts

Detailed product costing

Input prices

Supply chain

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Human resources

Number of employees

Employees personal information

Recruitment procedures

Training programs

Details of pay

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External Information

mainly concerned with the non-controllableaspects of the decision making problem.Example in marketing:

Total market size Market characteristics

Competitors products

Competitors prices

Competitors promotional efforts

Consumer buying behavior

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External Information The major sources of external secondary information are

Governmental

Labor UnionWorking period, welfare, (SOCSO , EPF)

Industrial Policy -

Taxation

Budget

Regulation

Commercial services

Bank - Rate of Financing

Political

Leadership changes

Economic

Budget

Inflation

Recession

Technology

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Information Strategy

What internal and external factors will effect

the future success of the organization?

Examples: interest rates, labor costs, raw material

prices, government regulation, consumer trends.

What sources of information are available to

monitor these factors?

Examples: Newspapers, trade journals,

government studies, private research.

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Information Strategy

How often should each of these factors be

monitored?

Daily, weekly, monthly, quarterly, annually

What form should reports on these factors

take?

Written, oral, statistical, graphic, on-site visits

Who should receive these reports?

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INPUT OUTPUTPROCESS

FEEDBACK

Information Processing Cycle

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Information Processing Cycle

Figure 1.1 Input-Process-Output

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Management Level

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Management Level

Strategic Planning Level

The strategic planning level involves mangers at

the top of the organizational hierarchy. The term

strategic indicates the long-term impact of topmanagers decisions on the entire organization.

The term executive is often used to describe a

manager on the strategic planning level.

Senior managers: make long-range strategic

decisions about products and services

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Management Level

Management Control Level

Middle-level managers include regional managers,

product directors, and division heads. Their level is

called management control level due to theirresponsibility of putting plans into action and

ensuring the accomplishment of goals.

Middle managers: Carry out the programs and

plans of senior management

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Management Level

Operational Control Level

Lower level managers are persons responsible for

carrying out the plans specified by managers on

upper levels. Their level is called the operationalcontrol level because this is where the firms

operations occur.

Operational managers: monitor the firms daily

activities

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Management Level

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Mgt and Decision Making

Management mainly comprises:

Planningit is deciding when, what, where, how to do

Organizing- the process of dividing work into different task

and coordinating the task to achieve one or more

objectives

Coordinating- implies relating ones job with the other job

properly and connecting them to in proper way achieve

goals.

Directing- is the leadership of an org through

communication, inspiration and motivation of

organizational personnel.

Control- enable the manager to determine if the org.

performance is on target

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Planning

Strategic Level planning

Requires considerable amount of environmental

information like shifting market, changing technology as

well as internal information like core competitive strengthof the organization.

Tactical Planning

Activities such as vendor development, make-or-buy

decision would call for cost and availability informationpertaining to materials and production capacities which

are internal as well external to the organization.

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Planning

Operational Planning

Like staff scheduling requires large amount of

internal information, e.g., schedules, attendance,

up times of equipment.

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Organizing

Strategic organizing

Needs external and internal data to decide on re-

structuring as well as to forge strategic

partnerships.

Tactical organizing

Requires changing wage-level data of the

organization as well as that of competitors.

Operational organizing

Needs data relating to skills and training

requirements of the operational staff.

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Coordinating

Strategic coordination

Calls for industry-wide data corresponding to

technology availability.

Tactical coordination

Calls for plant-wide and supplier-wise bottleneck

data that reflect deficiencies both inside and

outside the organization.

Operational coordination

Requires itemized breakup of plant and machinery

performances, failures, etc

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Directing

Strategic directing

Functions such as introduction of office

automation requires detailed cost-benefit analysis

of new technologies.

Tactical directing

E.g. innovative marketing strategy, needs detailed

market and production data.

Operational directing

Function requires detailed data pertaining to the

individual managers skills.

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Control

Strategic control

Decision like total quality mgt needs detailed

performances data and bench marking data from

outside the organization.

Tactical control

Decisions like maintaining steady market share in

the medium run would necessitate continuousmonitoring of plant data.

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Control

Operational control

May call for techniques of statistical process

control which involves the collection of substantial

sampling information that must be collected andprocessed continuously during the entire

production period.

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Level of Involvement

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Level of Involvement

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Functional Areas in Business

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Functional Areas in Business

The purposeo to ensure that all important business activities

are carried out efficientlyo

specific areas will be responsibility forsupporting specific types of aims andobjectives, for example: sales and marketing will be involved in achieving

targets linked to developing new markets orincreasing sales

human resources will be involved in arranging stafftraining activities and supporting the continuousprofessional development of all staff

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Functional Areas in BusinessFunction

o finance will be expected to monitor and support aimsand objectives linked to keeping costs low to improveprofitability

o production will be set targets relating to quality or

meeting planned production schedules. Functional areas vary between

organizations, depending upon the type ofwork carried out. For example :o retailers do not need a production function.

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Functional Areas In Business

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R l ti hi B t Diff t

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Relationships Between DifferentFunctional Areas


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