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Business Processes and varioustypes of Business Information

Systems

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At the end of the session you

will know :

What is Business Process

Example of Business Process

What is Information System

Categories of Information system

Major types of Information system

TPS

MIS

DSS

ESS

Interrelationship among different Information System

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Business Processes and Information

SystemsBusiness process consists of Business process consists of

Manner in which work is organized, coordinated, andManner in which work is organized, coordinated, and

focused to produce a valuable product or servicefocused to produce a valuable product or service

Concrete work flows of material, information, andConcrete work flows of material, information, and

knowledgeknowledge²²sets of activitiessets of activities

Unique ways to coordinate work, information, andUnique ways to coordinate work, information, and

knowledgeknowledge

Ways in which management chooses to coordinate workWays in which management chooses to coordinate work

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Systems from a Functional PerspectiveExamples of Business Processes

Functional AreaFunctional Area Business ProcessBusiness Process

Assembling the productAssembling the product

Checking for qualityChecking for quality

Producing bills of materialsProducing bills of materials

Identifying customersIdentifying customers

Making customers aware of theMaking customers aware of the product product

Selling the productSelling the product

Paying creditorsPaying creditors

Creating financial statementsCreating financial statements

Managing cash accountsManaging cash accounts

Hiring employeesHiring employees

Evaluating employeesEvaluating employees¶¶ job job

performance performance

Enrolling employees in benefitsEnrolling employees in benefits plans plans

ManufacturingManufacturing

and productionand production

Human resourcesHuman resources

Finance and accountingFinance and accounting

Sales And MarketingSales And Marketing

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Information System

� An information system can be defined as any

organized combination of people, hardware,

software, communication networks, and data

resources that collects, transforms, anddisseminates information in an organization

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How Information System is Useful««.

Information systems help organizationsInformation systems help organizations

achieve great efficiencies by automating partsachieve great efficiencies by automating parts

of processesof processes

IS also contributes to completely reIS also contributes to completely re--thinkingthinking

processes.processes.

Business processes typically span severalBusiness processes typically span severaldifferent functional areas.different functional areas.

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Categories Of Information System

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Different Categories of Systems

1. Operational - level systems:

Support operational managers keep track of the

elementary activities and transactions.

2. Management-level systems:

Serve the monitoring, controlling, decision-making, andadministrative activities

3. Strategic-level systems:

Help senior management tackle and address strategicissues.

Three main categories of information systems function atdifferent organizational levels:

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Types of Information Systems

Functional Perspective

Manufacturing & Production System

Sales & Marketing System

Finance & Accounting Human Resources System

Constituency Perspective

Transaction Processing Systems (TPS)

Management Information Systems (MIS) Decision-Support Systems (DSS)

Executive Support Systems (ESS)

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Functional Perspective

� Manufacturing & Production System

Major functions of systems:

� Scheduling, purchasing, shipping, receiving, engineering,

operations

Major application systems:

� Materials resource planning systems, purchase order control

systems, engineering systems, quality control systems

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Sales & Marketing System

� Major functions of systems:

Sales management, market research, promotion, pricing,

new products

� Major application systems:

Sales order info system, market research system, pricing

system

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Finance & Accounting

� Major functions of systems:

Budgeting, general ledger, billing, cost accounting

� Major application systems:

General ledger, accounts receivable, accounts payable,

budgeting, funds management systems

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Human Resources System

�� Major functions of systems:Major functions of systems:

Personnel records, benefits, compensation, labor Personnel records, benefits, compensation, labor

relations, trainingrelations, training

�� Major application systems:Major application systems:

Payroll, employee records, benefit systems, career pathPayroll, employee records, benefit systems, career path

systems, personnel training systemssystems, personnel training systems

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Major Types of Information Systems

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Major Types of Information Systems:

These are the basic business systems that servethe operational level.

A computerized system that performs and

records the daily routine transactions necessaryfor the conduct of the business.

1.Transaction Processing Systems

(TPS)

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A Symbolic Representation for a Payroll

TPS

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Typical Applications of TPS

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2. Management Information Systems (MIS)

Four Major Types of Information Systems:

Inputs:H

igh volumetransaction level data

Processing: Simple models

Outputs: Summary reports

Users: Middle managers

Example: Annual budgeting

These systems serve at management level.

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Management Information Systems (MIS)

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A Sample MIS Report :

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3. Decision-Support Systems (DSS)

These systems serve at the management level

Inputs: Transaction level data

Processing: Interactive

Outputs: Decision analysis

Users: Professionals, staff

Example: Contract cost analysis


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Decision-Support Systems (DSS) (Continued)

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4. Executive Support Systems (ESS):

Inputs:Aggregate data

Processing: Interactive

Outputs: Projections

Users: Senior managers

Example: 5 year operating plan


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Model of a Typical Executive Support

System

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EXECUTIVE SUPPORT SYSTEMS (ESS)

(Continued)

Top level management

Designed for the individual senior manager

Ties CEO to all levels

Very expensive

Extensive support staff

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Interrelationships Among Information systems

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Interrelationships Among Information

systems

In contemporary digital firms, different types of

systems are closely linked to one another. This is

the ideal.

In traditional firms these systems tend to be isolatedfrom one another, and information does not flow

seamlessly from one end of the organization to the

other.

Efficiency and business value tend to suffer greatly

in these traditional firms.

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