Is and Types

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#Faculty Name: Muhammad Aqeel

INFROMATION SYSTEMS


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SYSTEM: It is a collection of inter-related objectsworking together to achieve some common

objective, task or goal. e.g Computer System,

MANAGEMNT:is responsible for smooth and proper

functioning of an Organization / Business.

INFORMATION:processed facts which can be used in decisionmaking process

BUSINESS INFORMATION:Information concerned with any business

is called BI

BASIC CONCEPTS


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INFORMATION SYSTEM:An organized combination of people,

hardware, software, communications

network and data resources that collects,

transforms and disseminates information

in an organization.

CBISCOMPUTER BASED INFORMATION SYSTEM

BASIC CONCEPTS


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CBIS

Components of CBIS

Data

People Hardware

Software

Communication Infrastructure

BASIC CONCEPTS


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Working Class / Clerical Staff

Strategic

Management

Tactical

Management

Operational

Management

Management Hierarchy


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Information Categories

Strategic Information Derived from internal and external sources

Summarized at a high level

Relevant to the long term planning Concerned with the whole organization

Often prepared on ad-hoc basis

Both qualitative and quantitative May be incomplete or uncertain


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Tactical Information

Primarily generated from internal sources

Summarized at relatively low level

Relevant to the short and medium terms

Prepared routinely and regularly

Based on quantitative measures


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Operational Information

Derived from internal sources

Presents detailed transactional data

Relevant to the immediate term

Task specific applications

Prepared very frequently

Largely quantitative


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Information Characteristics

Accuracy

Completeness

Cost EffectivenessUser targeted

Relevance

Authenticity

Timeliness

Ease of use

CurrencyFrequency

Validity

Verification


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Decision Theory

Decision Making

The cognitive process of reaching adecision.

Selecting optimum strategy out of

multiple options leading to consequenceswith variable probabilities


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TYPES of DECISION

Certain Decision

Based on Complete and Correct Information

Un-Certain Decision

Based on Correct but In-complete Information

Risky Decision

Based on Incorrect or unrealistic Information


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Customization Operations

Summarizing (preparing concise reports)

Grouping (division and accumulation)

Aggregation (combining into group/s)

Segregation (splitting information into groups)

Filtering (separating req. & non-required)

Sorting (arranging data acc. 2 criterion) Searching (also known as queries)

TYPES OF INFORMATION SYSTEM


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Operation support Systems

TPS

PCS

ECS

Management Support Systems

MIS/MRS

DSS

EIS

OTHER CATEGORIES OF INFORMATIONSYSTEMS

KMS

Cross functional Information Systems

ERP


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TRANSACTION PROCESSING SYSTEMS (TPS)

Process data resulting from business transactions, update

operational databases and produce business documents.Examples: order processing, inventory processing

accounting systems etc.

PROCESS CONTROL SYSTEMS (PCS)Monitor and control industrial processes. Examples:

Petroleum Refining, Power Generation etc.

ENTERPRISE COLLABORATION SYSTEMS (ECS)Support team, workgroup and enterprise communications

and collaboration. Example: e-mail, chat, video conferencing

etc.

OPERATION SUPPORT SYSTEMS


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Management information systems: Provide

information in the form of pre-specified reports and displays(Screens) to support business decision making. Examples:

sales analysis, production performance, and cost trend

reporting systems.

Decision support systems: Provide interactive ad hocsupport for the decision-making processes of managers andother business professionals. Examples: product pricing,

profitability forecasting, and risk analysis systems.

Executive information systems: Provide criticalinformation from many sources tailored to the information

needs of executives. Examples: systems for easy access to

analyses of business performance, actions of competitors,

and economic developments to support strategic planning.

MANAGEMENT SUPPORT SYSTEMS


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Expert systems: Knowledge-based systems that provide expertadvice and act as expert consultants to users. Examples: credit

application advisor, process monitor, and diagnostic maintenance

systems.Knowledge management systems: Knowledge-based systemsthat support the creation, organization, and dissemination of business

knowledge within the enterprise. Examples: intranet access to best

business practices, sales proposal strategies, and customer problem

resolution systems.Strategic information systems: Support operations ormanagement processes that provide a firm with strategic products,

services and capabilities for competitive advantage. Examples: online

stock trading, shipment tracking, and e-commerce Web systems.

Functional business systems: Support a variety ofoperational and managerial applications of the basic businessfunctions of a company. Examples: information systems thatsupport applications in accounting, finance, marketing,operations management, and human resource management.

OTHER CATEGORIES OF INFORMATION SYSTEMS


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Cross functional Information systems that cross the

boundaries of traditional business functions in orderto reengineer and improve vital business processes

all across the enterprise. These organizations view

cross-functional enterprise systems as a strategic

way to use IT to share information resources and

improve the efficiency and effectiveness of

business processes, and develop strategic

relationships with customers, suppliers, andbusiness partners. These are also called Enterprise

System.

CROSS FUNCTIONAL INFORMATION SYSTEMS



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A type of Operation support system which process dataresulting from business transactions, updateoperational databases and produce businessdocuments. Examples: order processing, inventoryprocessing accounting systems etc.

Different techniques are used in TPS to processtransactions are:

Batch processing (OFF LINE Processing)

Real time processing (ON LINE Processing)

Different types of documents generated by TPS are:Information documents

Action documents

Turn around documents


TRANSACTION PROCESSING CYCLE


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The transaction processingcycle. Note that transactionprocessing systems use a fivestage cycle:-

Data entry Activity

Transaction Processing

Database Maintenance,

Document and Report

generation, and In uir Processin Activit

TRANSACTION PROCESSING CYCLE

ENTERPRISE COLLABORATION SYSTEMS (ECS)


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Enterprise collaboration systems (ECS) are cross-functionalinformation systems that enhance communication,

coordination, and collaboration among the members ofbusiness teams and workgroups. Information technology,especially Internet, Intranet and Extranet technologies are

used in these systems. The goal of these systems is to

enable us to work together more easily and effectivelyby helping us to:

Communicate: Share information with each other.

Coordinate: Organize our individual work effortsand use of resources.

Collaborate: Work together cooperatively on jointprojects and assignments.

ENTERPRISE COLLABORATION SYSTEMS (ECS)

TOOLS FOR (ECS)


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TOOLS FOR (ECS)

MANUFACTURING SYSTEMS


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Manufacturing Systems support the production/operationsfunction that includes all activitiesconcerned with the planning and control of theprocesses producing goods or services. Thus, theproduction/operations function is concerned with

the management of the operational processes andsystems of all business firms.

In these systems Computer Integrated Manufacturing(CIM) techniques are used for :-

Simplification

Automation

Integration.

MANUFACTURING SYSTEMS

MANUFACTURING INFORMATION SYSTEMS


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CIM supports theconcepts of flexiblemanufacturing systems,

agile manufacturing, andtotal qualitymanagement.Implementing suchmanufacturing conceptsenables a company to

respond to and fulfillcustomer requirementsquickly with high-qualityproducts and services.

MANUFACTURING INFORMATION SYSTEMS

SHOP FLOOR CONTROL (SFC)


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A system of computers and/or controllers tools usedto schedule, dispatch and track the progress of workorders through manufacturing based on definedroutings. SFCs typically calculate work in processbased on a percentage of completion for each order

and operation that are useful in inventory valuationsand materials planning.

SHOP FLOOR CONTROL (SFC)


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SUPPLY CHAIN

Supply Chain is a concept describing the flow ofmaterials, information, money and services from raw

material suppliers through factories and warehouses to

the end customers. It also includes the organizations

and processes that create and deliver these products,

information and services to end customers.


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Supply Chain Systems

Determine material requirements

Generate new orders

Send orders to suppliers Obtain commitment dates

Verify that the orders actually arrived

Alter

Information Systems 4th

ed. 2002 Prentice Hall 27


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Supply chain management (SCM)

System that allows close coordination withsuppliers

EDI and SCM are part of the general trendtoward integration between suppliersand their customers

AlterInformation Systems 4thed.

2002 Prentice Hall

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Material requirement planning (MRP)

Integrate purchasing & production activities

Calculate a schedule based on the output

requirement

Electronic data interchange (EDI)

The electronic transfer of business data

between the computerized informationsystems of two firms

AlterInformation Systems 4thed.

2002 Prentice Hall

29


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MATERIAL REQUISITION PLANNING (MRP)

The software that facilitates the plan for

acquiring or producing parts, sub-assemblies or

materials in the case of inter-dependence items is

called MRP. It follows a computer based approachdue to complex inter-relationship among many

products and their components and the need to

change the plan each time a delivery date or the

order quantity is changed.


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MANUFACTURING RESOURCE PLANNING (MRP II)

MRP II adds functionalities to a regular MRP. It

determines the cost of the parts assembled /

manufactured and the cash flow needed to pay for

the parts. It also estimates cost of labour, tools

equipment, repair and energy and finally provides a

detailed computerized benefit for the parts involved.


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JUST-IN-TIME (JIT)

Attempts to minimize wastage of all kinds e.g.

space, labour, material, energy, etc and to

continuously improve processing systems. Many JIT

systems are supported by software from differentvendors e.g. IBM, HP, etc.


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Computerized Integrated Manufacturing (CIM)CIM is a concept that provides the integration of

various computerized factory systems. CIM isexpected to achieve the following three goals: Simplification of all manufacturing technologies

and techniques. Automation. Interaction and coordination of design,

manufacturing and related functions via

computer hardware and software. Technologiesto be integrated are FMSs (FlexibleManufacturing Systems), JIT, MRT, CAD, GT(Group Technology).


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Marketing information systems use information technologies

to support major components of the marketing function.

Th H R M (HRM) f i i l


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The Human Resource Management (HRM) function involves

the recruitment, placement, evaluation, compensation,

and development of the employees of an organization.

The goal of human resource management is the effectiveand efficient use of the human resources of a company.

Human resource information systems (HRIS) are designed

to support

(1) planning to meet the personnel needs of the business,(2) development of employees to their full potential, and

(3) control of all personnel policies and programs.

Originally, businesses used computer-based information

systems to(1) produce paychecks and payroll reports,

(2) maintain personnel records, and

(3) analyze the use of personnel in business operations,

and security.


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Now a days many firms have gone beyond these

traditionalpersonnel management functions and have

developed Human Resource Information Systems (HRIS)

that also support

(1) Recruitment, Selection, and Hiring;

(2) Job Placement (Transfer Posting);

(3) Performance Appraisals;

(4) Employee Benefits Analysis;(5) Training and Development; and

(6) Health, Safety, and Security.


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MANAGEMENT REPORTING SYSTEM (MRS)


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A type of Management support system which

generates various reports extracted from the

database built by TPS. These reports facilitates the

managers in structured decisions.

Different types of Reports generated by MRS are:

Scheduled Reports

Exception Reports

Structured Reports

Ad hoc Reports

DIFFERNCE BETWEEN TPS AND MRS

MANAGEMENT REPORTING SYSTEM (MRS)

DECISION SUPPORT SYSTEMS


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Decision support systems use (1) analytical

models, (2) specialized databases, (3) a decision

makers own insights and judgments, and (4) an

interactive, computer-based modeling process to

support the making of semi-structured andunstructured business decisions.

Normally these systems used by Middle level

Management. Major data processing operationshave to specify by end user (End user Computing).

Spread Sheet Packages are example of DSS.

DECISION SUPPORT SYSTEMS

Activities and examples of the major types of


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Activities and examples of the major types of

analytical modeling

Type of Analytical Modeling Activities and Examples

What-if analysis Observing how changes to selected variables affectother variables.

Example: What if we cut advertising by 10 percent?What would happen to sales?

Sensitivity analysis Observing how repeated changes to a single

variable affect other variables.Example: Lets cut advertising by $100 repeatedlyso we can see its relationship to sales.

Goal-seeking analysis Making repeated changes to selected variables untila chosen variable reaches a target value.

Example: Lets try increase in advertising until salesreach $1million.

Optimization analysis Finding an optimum value for selected variables,given certain constraints.

Example: Whats the best amount of advertising tohave, given our budget and choice of media?

EXECUTIVE INFORMATION SYSTEMS


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Executive Information systems (EIS) are informationsystems that combine many of the features of

management information systems and decision supportsystems. Primarily, their focus was on meeting thestrategic information needs of top management. Thus, thefirst goal of executive information systems was to providetop executives with immediate and easy access to

information about a firmscritical success factors (CSFs).These are also called Everyones Information Systems,Enterprise Information Systems (EIS) and ExecutiveSupport Systems (ESS). These names reflect the fact that

more features, such as Web browsing, electronic mail,groupware tools, and DSS and expert system capabilities,are being added to many systems to make them moreuseful to managers and business professionals.

EXECUTIVE INFORMATION SYSTEMS

KNOWLEDGE MANAGEMENT SYSTEMS


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Knowledge Management Systems (KMS) to manageorganizational learning and business know-how.The goal of such systems is to help knowledgeworkers create, organize, and make availableimportant business knowledge, wherever and

whenever its needed in an organization. Thisincludes processes, procedures, patents,reference works, formulas, best practices,forecasts, and fixes.

In many organizations, hypermedia databases atcorporate intranet websites have become the

knowledge base for storage and dissemination of

business knowledge.

KNOWLEDGE MANAGEMENT SYSTEMS

B i


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Business

Business is an economic activity concernedwith production and distribution of goodsand/or services with the aim to earn profit. It

includes all those activities which aredirectly /indirectly concerned withproduction, purchase and sale of goods and

services. So the production, marketing,advertising, warehousing, insurance,banking, etc. are all business activities.

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EDI ELECTRONIC DATA INTERCHANGE


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EDI ELECTRONIC DATA INTERCHANGEElectronic data interchange (EDI) was one of the earliestuses of information technology for supply chain

management. EDI involves the electronic exchange ofbusiness transaction documents over the Internet andother networks between supply chain trading partners(organizations and their customers and suppliers). Data

representing a variety of business transaction documents(such as purchase orders, invoices, requests forquotations, and shipping notices) are automaticallyexchanged between computers using standard document

message formats. Typically, EDI software is used toconvert a companys own document formats intostandardized EDI formats as specified by various industryand international protocols. Thus, EDI is an example of

the almost complete automation of an e-commerce supply


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E-commerce

The process of buying, selling and marketingthe Products / Services using internetTechnologies. Any internet visitor can access

information about a product, place an order,make electronic payments to commit theorder, and in some cases can receive

products or services using computers.E-commerceisthe part of e-business thatthe customer experiences directly


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E-commerce Categories

Business to Business (B2B)

Sales of goods and services among business

Business to Customer (B2C)

Retailing products and services

Customer to Customer (C2C)

Individuals use web for sale and service

Government to Customer (G2C)


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E-Commerce Architecture

Most of the information technologies and Internettechnologies are involved in e-commerce systems asclear from the following figure , which gives an exampleof the technology resources required by many e-commerce systems. The figure illustrates some of thehardware, software, data, and network componentsused by a compny to provide business-to-business

(B2B) online auction e-commerce services.

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Advantages of E-Commerce

The advantages of e-commerce allow a business ofvirtually any size that is located virtually anywhere on theplanet to conduct business with just about anyone,

anywhere.The power of e-commerce allows geophysical barriers todisappear, making all consumers and businesses onearth potential customers and suppliers.

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Advantages of E Commerce


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The advantages of e-commerce allow a businessof virtually any size that is located virtuallyanywhere on the planet to conduct business withjust about anyone, anywhere.

Imagine a small olive oil manufacturer in a remotevillage in Italy selling its wares to majordepartment stores and specialty food shops in

large metropolitan markets of various parts of theworld . The power of e-commerce allowsgeophysical barriers to disappear, making all

consumers and businesses on earth potential54



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Barrier to Entry are Low

Global Presence / Global Choice

Improved Competitiveness / Quality of

Service Mass Customization / Personalized

Products and Services

Substantial Cost Savings / SubstantialPrice Reductions

Novel Business Opportunities / New

Products and Service55


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C fid ti lit


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ConfidentialityPotential consumers are concerned about providingunknown vendors with personal, sometimes sensitive

information. Connecting to the internet via abrowser requires running software on the computerthat has been developed by some one unknown to

the organization.

IntegrityData, both in transit and storage, could be

susceptible to unauthorized alteration or deletion


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AvailabilityThe internet holds out the promise of doing business

on a 24-hour, seven days-a-week basis. Hence, highavailability is important with any systems failurebecoming immediately apparent to customers orbusiness pattern.

Authentication & NonrepudiationThe parties to an electronic transaction should be ina known and trusted business relationship, whichrequires that they prove their respective identities

before executing the transaction. Then, after thefact, there must be some manner of ensuring thatthe transacting parties cannot deny that thetransaction was entered into and terms on which it

was com leted.


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Sabotage or Defacement:

Unauthorized access:Degradation of performance:

E-Commerce Risk


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Sabotage or Defacement:All the business transactions and dealsgoing on through online methods, youbeing a businessman can also face theproblem of attacks. There are differentmalicious attacks like virus, worms andTrojan horse, that your system can be a

pray to. You should always have a goodanti-virus and keep it updated to impedeany such kinds of attacks.

h d h l b


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Unauthorized access: While you may not beaware of and trust your employees the best,

you might never know who accesses your dataand account illegally. Unauthorized access toyour data can also be done by outsiders. Poor

configuration of systems and poor encryptedtransmission are few factors that can letothers access your confidential business dataillegally. You must also be careful to choose

strong passwords, and avoid hint questionslike maiden name of your mother or schoolyou went to. In most cases you can form your

own question. Do that wherever applicable;

CRM


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CRM uses information technology to create across-functional enterprise system thatintegrates and automates many of thecustomer-serving

processes in sales,marketing, and customer services thatinteract with a companys customers.CRM systems include a family of software

modules that provides the tools that enablea business and its employees to deliver fast,convenient, dependable, and consistent

service to its customers.

CRM

CRM


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CRM

THREE PHASES CRM


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Acquire. CRM software help to acquire newcustomers by doing a superior job of contactmanagement, sales prospecting, selling, direct

marketing, and fulfillment. The goal of theseCRM functions is to help customers toperceive the value of a superior product

offered by an outstanding company.

THREE PHASES - CRM

THREE PHASES CRM


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Enhance . Web-enabled CRM accountmanagement and customer service andsupport tools help to keep customers happy bysupporting superior service from a

responsive networked team of sales andservice specialists and business partners. Inaddition, CRM sales force automation and

direct marketing and fulfillment tools alsohelp companies in cross-selling and up-sellingto their customers, thus increasing their

profitability to the business. The value the -

THREE PHASES - CRM

THREE PHASES CRM


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Retain . CRM analytical software anddatabases help a company proactivelyidentify and reward its most loyal and

profitable customers to retain and expandtheir business via targeted marketing andrelationship marketing programs. The valuethe customers perceive is of a rewardingpersonalized business relationship withtheir company.

THREE PHASES - CRM

BENEFITS - CRM


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BENEFITS CRM CRM allows a business to identify and target its best

customersthose who are the most profitable to the

business so they can be retained as lifelong customers forgreater and more profitable services.

It makes possible real-time customization andpersonalization of products and services based on

customer wants, needs, buying habits, and life cycles.

CRM can also keep track of when a customer contactsthe company, regardless of the contact point.

In addition, CRM systems can enable a company toprovide a consistent customer experience and superiorservice and support across all the contact points a

customer chooses.

All of these benefits would provide strategic business value

CRM - FAILURE


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CRM FAILUREThe common wisdom of why CRM systems fail includes:

Lack of senior management sponsorship

Improper change management

Elongated projects that take on too much, too fast

Lack of or poor integration between CRM and core

business systems

Lack of end-user incentives leading to poor user

adoption rates


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A successful SCM strategy is based on accurate order

i j i i i d i l


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processing, just-in-time inventory management, and timely

order fulfillment.

supply chain management helps a company get the rightproducts to the right place at the right time, in the proper

quantity and at an acceptable cost. The goal of SCM is to

manage this process efficiently by forecasting demand;

controlling inventory; enhancing the network of businessrelationships a company has with customers, suppliers,

distributors, and others; and receiving feedback on the

status of every link in the supply chain.

To achieve this goal, many companies today aret i t I t t t h l i t W b bl th i


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turning to Internet technologies to Web-enable theirsupply chain processes, decision making, and

information flows.Supply Chain Management is a cross-functional inter-enterprise system that uses information technologyto help support and manage the links between someof a companys key business processes and those ofits suppliers, customers, and business partners. Thegoal of SCM is to create a fast, efficient, and low-cost

network of business relationships, or supply chain ,to get a companys products from concept to market.

Supply chain management software and Internettechnologies can help companies reengineer andinte rate the functional SCM rocesses that su ort


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ERP ENTERPRISE RESOURCE PLANNINGERP f ti l t i b kb


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ERP serves as a cross-functional enterprise backbonethat integrates and automates many internal business

processes and information systems within themanufacturing, logistics, distribution, accounting,finance, and human resource functions of a company.Enterprise resource planning is a cross-functional

enterprise system driven by an integrated suite ofsoftware modules that supports the basic internalbusiness processes of a company.

ERP gives a company an integrated real-time view ofits core business processes, such as production,order processing, and inventory management, tiedtogether by the ERP application software and a

common database maintained by a database

The major application components of enterprise resource

planning demonstrate the cross functional approach of ERP


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planning demonstrate the cross functional approach of ERP

systems.

The business processes and functions supported by the ERP

system implemented by the Colgate Palmolive Company


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system implemented by the Colgate- Palmolive Company.

ERP BENEFITS

Q lit d ffi i


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Quality and efficiency .ERP creates a framework for integrating and

improving a companys internal business processesthat results in significant improvements in thequality and efficiency of customer service,production, and distribution.

Decreased costs .Many companies report significant reductions intransaction processing costs and hardware, software,

and IT support staff compared to the nonintegratedlegacy systems that were replaced by their new ERPsystems.

ERP BENEFITS

D i i t


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Decision support .ERP provides vital cross-functional information on

business performance to managers quickly whichsignificantly improve their ability to make betterdecisions in a timely manner across the entirebusiness enterprise.

Enterprise agility .Implementing ERP systems breaks down many formerdepartmental and functional walls of business

processes, information systems, and informationresources which results in more flexibleorganizational structures, managerialresponsibilities, and work roles, and therefore a

more agile and adaptive organization and workforce

Typical costs of implementing a new ERP system.


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Documents

Is and Types