1 1 Information systems for management ดร. สล ล บ ญพราหมณ 2558
2 2...ความสว สด ของข าพเจ าจะเก ดข นได ก ด วยบ านเม องของเราม ความเจร ญม นคงเป นปกต ส ข ความเจร ญม นคงท งน นจะส าเร จ ผลเป นจร งไปได ก ด วยท กคนท กฝ ายในชาต ม งท จะปฏ บ ต หน าท ของตนให เต มก าล ง ด วยสต ร ต ว ด วยป ญญาร ผ ด และ ด วยความส จร ตจร งใจ โดยเห นแก ประโยชน ส วนรวมย งกว าส วน อ น ค ดจากพระราชด าร สพระบาทสมเด จพระเจ าอย ห วภ ม พลอด ลยเดชฯ ในการเสด จออกมหาสมาคมใน พระราชพ ธ เฉล มพระชนมพรรษา พ ทธศ กราช ๒๕๕๒
3 Management 3 Mintzberg (1973) separated these roles into three subcategories interpersonal contact information processing decision making
4 interpersonal contact 4 FIGUREHEAD: the manager performs ceremonial and symbolic duties as head of the organization; LEADER: fosters a proper work atmosphere and motivates and develops subordinates; LIASION: develops and maintains a network of external contacts to gather information
5 information processing 5 MONITOR: gathers internal and external information relevant to the organisation; DISSEMINATOR: transmits factual and value based information to subordinates; SPOKESPERSON: communicates to the outside world on performance and policies.
6 decision making 6 ENTREPRENEUR: designs and initiates change in the organisation; DISTURBANCE HANDLER: deals with unexpected events and operational breakdowns;
7 7 RESOURCE ALLOCATOR: controls and authorises the use of organisational resources; NEGOTIATOR: participates in negotiation activities with other organisations and individuals.
8 Perspectives on Information Systems 8 Information Systems Are More Than Computers Using information systems effectively requires an understanding of the organization, management, and information technology shaping the systems. An information system creates value for the firm as an organizational and management solution to challenges posed by the environment.
9 Perspectives on Information Systems 9 Organizational dimension of information systems Hierarchy of authority, responsibility Senior management Middle management Operational management Knowledge workers Data workers Production or service workers
10 10 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. Robert Anthony's hierarchy of management activity (1965)
11 Types of Information Systems MAJOR TYPES OF SYSTEMS IN ORGANIZATIONS 11
12 12 Three main categories of information systems serve different organizational levels: 1. Operational-level systems: support operational managers, keeping track of the elementary activities and transactions 2. Management-level systems: serve the monitoring, controlling, decision-making, and administrative activities 3. Strategic-level systems: help senior management tackle and address strategic issues
13 13 Major Types of Systems Transaction Processing Systems (TPS) Management Information Systems (MIS) Decision-Support Systems (DSS) Executive Support Systems (ESS)
15 Transaction Processing Systems (TPS) 15 Basic business systems that serve the operational level A computerized system that performs and records the daily routine transactions necessary to the conduct of the business
16 16 Payroll TPS
17 Typical Applications of TPS 17 Sales/marketing system Manufacturing / production systems Major functions of system Major app system Customer service Sales management Promotion tracking Price changes Dealer communications Sales order info sys Sales commission system Sales support system Scheduling Purchasing Shipping/ receiving operations Machine control systems Purchase order systems Quality control systems
18 Typical Applications of TPS 18 Major functions of system Major app system Finance/accounting systems General ledger Billing Cost accounting General ledger Payroll Account receivable / payable Funds management systems Human resources system Personnel records Benefits Compensation Labor relations Training Employee records Benefit systems Employee skill inventory
19 Typical Applications of TPS 19 Major functions of system Major app system Other types e.g. university Admissions Grade records Course records Alumni records Registration system Student transcript system Curriculum class control systems Alumni benefactor system
20 Management Information Systems (MIS) 20 Inputs: High volume transaction level data Processing: Simple models Outputs: Summary reports Users: Middle managers Example: Annual budgeting
21 21 Management Information Systems (MIS) (continued)
22 22 A sample MIS report
23 Decision-Support Systems (DSS) 23 Inputs: Transaction level data Processing: Interactive Outputs: Decision analysis Users: Professionals, staff Example: Contract cost analysis
24 24 Voyage-estimating decision-support system
25 EXECUTIVE SUPPORT SYSTEMS (ESS) 25 Inputs: Aggregate data Processing: Interactive Outputs: Projections Users: Senior managers Example: 5 year operating plan
26 26 Top Level Management Designed to the individual senior manager Ties CEO to all levels Very expensive to keep up Extensive support staff
27 27 Model of a Typical Executive Support System
28 28 Relationship of Systems to One Another Interrelationships among systems
29 29 In contemporary digital firms, the different types of systems are closely linked to one another. This is the ideal. In traditional firms these systems tend to be isolated from 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
30 Sales and Marketing Systems 30 Major functions of systems: Sales management, market research, promotion, pricing, new products Major application systems: Sales order info system, market research system, pricing system
31 31 system description Org level Order processing Enter, process, and operational track orders Pricing analysis Determine prices management for product and services Sales trend forecasting Prepare 5-year sales forecasts strategic Sales and Marketing Systems
32 Manufacturing and Production Systems 32 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
33 33 system description Org level Machine control Control the actions of machines and equipment Production planning Decide when and how many products should be produced Facilities location Decide where to locate new production facilities operational management strategic Manufacturing and Production Systems
34 34 Overview of an Inventory System
35 Financing and Accounting Systems 35 Major functions of systems: Budgeting, general ledger, billing, cost accounting Major application systems: General ledger, accounts receivable, accounts payable, budgeting, funds management systems
36 36 system description Org level Account receivable Budgeting Tracks money owed the firm Prepares short-term budgets operational management Profit planning Plans long-term profits strategic Financing & Accounting Systems
37 Human Resource Systems 37 Major functions of systems: Personnel records, benefits, compensation, labor relations, training Major application systems: Payroll, employee records, benefit systems, career path systems, personnel training systems
38 38 system description Org level Training and development Compensation analysis Human resources planning Tracks employee training, skills, and performance appraisals Monitors the range and distribution of employee wages, salaries, and benefits Plans the long-term labor forces needs of the organization operational management strategic Human Resource Systems
39 39 An Employee Recordkeeping System
40 Business Processes and Information Systems 40 Business processes: Manner in which work is organized, coordinated, and focused to produce a valuable product or service Concrete work flows of material, information, and knowledge sets of activities Unique ways to coordinate work, information, and knowledge Ways in which management chooses to coordinate work
41 41 Information systems help organizations achieve great efficiencies by automating parts of processes IS also contributes to completely rethinking processes. Business processes typically span several different functional areas.
42 Examples of Business Processes 42 Manufacturing and production: Assembling product, checking quality, producing bills of materials Sales and marketing: Identifying customers, creating customer awareness, selling
43 43 Finance & accounting: Paying creditors, creating financial statements, managing cash accounts Human resources: Hiring employees, evaluating performance, enrolling employees in benefits plans
44 Cross-Functional Business Processes: 44 Transcend boundary between sales, marketing, manufacturing, and research and development Group employees from different functional specialties to a complete piece of work Example: Order Fulfillment Process
45 45 The Order Fulfillment Process
46 Systems for Enterprise-Wide Process Integration 46 Enterprise applications: Designed to support organization-wide process coordination and integration Consist of: Enterprise systems Supply chain management systems Customer relationship management systems Knowledge management systems
47 Enterprise Systems 47 also known as enterprise resource planning (ERP) systems, provide a single information system for organization-wide coordination and integration of key business processes. Information that was previously fragmented in different systems can seamlessly flow throughout the firm so that it can be shared by business processes in manufacturing, accounting, human resources, and other areas.
48 48 Enterprise Application Architecture
49 49 Traditional Silo View of Information Systems Within the business: There are functions, each having its uses of information systems Outside the organization s boundaries: There are customers and vendors Functions tend to work in isolation
50 50 Traditional View of Systems
51 51 Enterprise Systems
52 Benefits of Enterprise Systems 52 Help to unify the firm s structure and organization: One organization Management: Firm wide knowledge-based management processes Technology: Unified platform Business: More efficient operations & customerdriven business processes
53 Challenges of Enterprise Systems 53 Difficult to build: Require fundamental changes in the way the business operates Technology: Require complex pieces of software and large investments of time, money, and expertise Centralized organizational coordination and decision making: Not the best way for the firms to operate
54 Supply Chain Management (SCM) 54 Close linkage and coordination of activities involved in buying, making, and moving a product Integrates supplier, manufacturer, distributor, and customer logistics time Reduces time, redundant effort, and inventory costs Network of organizations and business processes
55 55 Helps in procurement of materials, transformation of raw materials into intermediate and finished products Helps in distribution of the finished products to customers Includes reverse logistics - returned items flow in the reverse direction from the buyer back to the seller
56 56 Haworth s Supply Chain Management Systems
57 57 Information from Supply Chain Management Systems helps firms: Decide when and what to produce, store, and move Rapidly communicate orders Track the status of orders Check inventory availability and monitor inventory levels
58 58 Reduce inventory, transportation, and warehousing costs Track shipments Plan production based on actual customer demand Rapidly communicate changes in product design
59 Customer Relationship Management (CRM) 59 Manages all ways used by firms to deal with existing and potential new customers Business and technology discipline Uses information system to coordinate entire business processes of a firm Provides end- to- end customer care Provides a unified view of customer across the company Consolidates customer data from multiple sources and provides analytical tools for answering questions
60 60 Customer Relationship Management (CRM)
61 Knowledge Management Systems 61 Collects relevant knowledge and make it available wherever and whenever it is needed Support business processes and management decisions Also link the firm to external sources of knowledge Support processes for acquiring, storing, distributing, and applying knowledge
62 62 Management Opportunities: There are extraordinary opportunities to use information systems to achieve business value, and increase profitability
63 63 Management Challenges: Integration and the whole firm view: Given the different interests and perspectives within a firm, it is difficult to achieve consensus about the need for the "whole firm" viewpoint. Management and employee training: Training a large number of employees on many systems in a large organization involves commensurately large investments.
64 64 Accounting for the cost of systems and managing demands for systems: Given the large number of different types of systems in a firm, and the large number of people involved with using them, it is a complex task to understand which systems are truly necessary and productive with high returns on investment
65 Solution Guidelines: 65 Inventory the firm s information systems: Develop a list of firm-wide information requirements to give a 360-degree view of the most important information needs of the firm. Employee and management education: Ensure that you understand how much training is required. Account for the costs and benefits: Develop an accounting system for information services firmwide.
66 66 Reference Kenneth C. Laudon & Carol Guercio Traver. (2011). Management Information Systems: Managing the Digital Firm. 12th Ed. Prentice Hall.