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2.1 THE STRATEGIC ROLE OF INFORMATION SYSTEMS
2.1
THE STRATEGIC ROLE OF INFORMATION SYSTEMS
2.2
LEARNING OBJECTIVES
• ANALYZE ROLES OF 6 TYPES OF INFORMATION SYSTEMS
• DESCRIBE TYPES OF INFORMATION SYSTEMS
• EXAMINE COMPETITIVE FORCES, VALUE CHAIN MODELS
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2.3
LEARNING OBJECTIVES
• EXPLAIN DIFFICULTIES OF BUILDING, SUSTAINING STRATEGIC INFORMATION SYSTEMS
• DESCRIBE HOW INFORMATION SYSTEMS SUPPORT LEVELS OF BUSINESS STRATEGY
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2.4
MANAGEMENT CHALLENGES• INTEGRATION:
– ENTERPRISE RESOURCE MANAGEMENT
– CONNECTING ORGANIZATIONAL LEVELS DIFFICULT, COSTLY
• SUSTAIN COMPETITIVE ADVANTAGE:– INFO SYSTEMS MUST BE FLEXIBLE TO
ENSURE LONG-TERM PROFITS
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2.5
TYPES OF INFORMATION SYSTEMS
DATA WORKERS
KIND OF SYSTEM GROUPS SERVED
STRATEGIC LEVEL SENIOR MANAGERS
MANAGEMENT LEVEL MIDDLE MANAGERS
OPERATIONAL OPERATIONAL LEVEL
MANAGERS
KNOWLEDGE LEVEL KNOWLEDGE &
SALES & MANUFACTURING FINANCE ACCOUNTING HUMAN RESOURCESMARKETING
2.6
MAJOR TYPES OF SYSTEMS
• EXECUTIVE SUPPORT SYSTEMS (ESS)• DECISION SUPPORT SYSTEMS (DSS)• MANAGEMENT INFORMATION SYSTEMS (MIS)• KNOWLEDGE WORK SYSTEMS (KWS)• OFFICE AUTOMATION SYSTEMS (OAS)• TRANSACTION PROCESSING SYSTEMS (TPS)
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2.7
TYPICAL TPS APPLICATIONSSales & Marketing Systems
MAJOR FUNCTIONS OF SYSTEMS:• Sales Management; Market
Research; Promotion; Pricing; New Products
MAJOR APPLICATION SYSTEMS:• Sales Order Info System; Market
Research System; Pricing System
*TPSTPS
2.8
TYPICAL TPS APPLICATIONSManufacturing & Production Systems
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
*TPSTPS
2.9
TYPICAL TPS APPLICATIONSFinance & Accounting Systems
MAJOR FUNCTIONS OF SYSTEMS:• Budgeting; General Ledger; Billing:
Cost Accounting
MAJOR APPLICATION SYSTEMS:• General Ledger; Accounts
Receivable / Payable; Budgeting; Funds Management Systems
*TPSTPS
2.10
TYPICAL TPS APPLICATIONSHuman Resources Systems
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
*TPSTPS
2.11
TYPICAL TPS APPLICATIONSOther Types (e.g., University)
MAJOR FUNCTIONS OF SYSTEMS:• Admissions; Grade Records; Course
Records; Alumni
MAJOR APPLICATION SYSTEMS:• Registration System; Student
Transcript System; Curriculum Class Control System; Alumni Benefactor System
*TPSTPS
2.12
KNOWLEDGE LEVEL• INPUTS: DESIGN SPECS• PROCESSING: MODELLING• OUTPUTS: DESIGNS, GRAPHICS• USERS: TECHNICAL STAFF
EXAMPLE: ENGINEERING WORK STATION
KNOWLEDGE WORK SYSTEMS (KWS)
2.13
OFFICE AUTOMATION SYSTEMS (OAS)
• TOWARD A “PAPERLESS” OFFICE• REDESIGN OF WORK FLOW• INTEGRATED SOFTWARE• ERGONOMIC DESIGN• BRIGHT, CHEERFUL
WORK SPACE
EXAMPLE: PRESENTATION GRAPHICS
2.14
MANAGEMENT LEVEL• INPUTS: HIGH VOLUME DATA• PROCESSING: SIMPLE MODELS• OUTPUTS: SUMMARY REPORTS• USERS: MIDDLE MANAGERS
EXAMPLE: ANNUAL BUDGETING
MANAGEMENT INFORMATION SYSTEMS (MIS)
2.15
• STRUCTURED & SEMI-STRUCTURED DECISIONS
• REPORT CONTROL ORIENTED• PAST & PRESENT DATA• INTERNAL ORIENTATION• LENGTHY DESIGN PROCESS
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MANAGEMENT INFORMATION SYSTEMS (MIS)
2.16
MIS
MIS FILES
SALES DATA
UNIT PRODUCT COST
PRODUCT CHANGE DATA
EXPENSE DATA
MISREPORTS
MANAGERS
TPS
Order Processing
System
Materials Resource
Planning System
General Ledger
System
ORDER FILE
PRODUCTION MASTER FILE
ACCOUNTING FILES
TPS DATA FOR MIS APPLICATIONS
2.17
MANAGEMENT LEVEL• INPUTS: LOW VOLUME DATA• PROCESSING: INTERACTIVE• OUTPUTS: DECISION ANALYSIS• USERS: PROFESSIONALS, STAFF
EXAMPLE: CONTRACT COST ANALYSIS
DECISION SUPPORT SYSTEMS (DSS)
2.18
• FLEXIBLE, ADAPTABLE, QUICK• USER CONTROLS INPUTS/OUTPUTS• NO PROFESSIONAL PROGRAMMING• SUPPORTS DECISION PROCESS• SOPHISTICATED MODELING TOOLS
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DECISION SUPPORT SYSTEMS (DSS)
2.19
STRATEGIC LEVEL• INPUTS: AGGREGATE DATA• PROCESSING: INTERACTIVE• OUTPUTS: PROJECTIONS• USERS: SENIOR MANAGERS
EXAMPLE: 5 YEAR OPERATING PLAN
EXECUTIVE SUPPORT SYSTEMS (ESS)
2.20
• TOP LEVEL MANAGEMENT• DESIGNED TO THE INDIVIDUAL• TIES CEO TO ALL LEVELS• VERY EXPENSIVE TO KEEP UP• EXTENSIVE SUPPORT STAFF
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EXECUTIVE SUPPORT SYSTEMS (ESS)
2.21
INTERRELATIONSHIPS AMONG SYSTEMS
ESS
TPSKWS
OAS
DSSMIS
2.22
SYSTEMS FROM A FUNCTIONAL PERSPECTIVE
• SALES & MARKETING SYSTEMS• MANUFACTURING & PRODUCTION
SYSTEMS• FINANCE & ACCOUNTING SYSTEMS• HUMAN RESOURCES SYSTEMS
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2.23
STRATEGIC ROLE OF INFORMATION SYSTEMS
STRATEGIC INFO SYSTEM:
CAN CHANGE GOALS, OPERATIONS
PRODUCTS, SERVICES
ENVIRONMENT
TO GAIN COMPETITIVE ADVANTAGE
2.24
COMPETITIVE FORCES MODEL
THE FIRMTRADITIONAL COMPETITION
NEW MARKET ENTRANTS
SUPPLIERS CUSTOMERS
SUBSTITUTE PRODUCTS & SERVICES
2.25
• PRODUCT DIFFERENTIATION• FOCUSED DIFFERENTIATION• DATAMINING• LINKING CUSTOMERS & SUPPLIERS• BECOMING LOW COST PRODUCER
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COUNTERING COMPETITIVE FORCES
2.26
VALUE CHAIN MODEL
HIGHLIGHTS PRIMARY & SUPPORT ACTIVITIES THAT ADD VALUE TO PRODUCTS, SERVICES
• PRIMARY: DIRECTLY RELATED TO PRODUCTION, DISTRIBUTION
• SUPPORT: INFRASTRUCTURE, HUMAN RESOURCES, TECHNOLOGY, PROCUREMENT
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2.27
IMPLICATIONS FOR MANAGERS & ORGANIZATIONS
• STRATEGIC ALLIANCES, INFORMATION PARTNERSHIPS
• INDUSTRY LEVEL STRATEGIC SYSTEMS
• MANAGING STRATEGIC TRANSITIONS
• IMPACT OF THE INTERNET
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2.28
INFORMATION SYSTEMS & QUALITY
• QUALITY: Conformance to specifications, customer satisfaction
• SIMPLIFY PRODUCT, PROCESS• BENCHMARKING• CUSTOMER DEMAND AS GUIDE• REDUCE CYCLE TIME• IMPROVE QUALITY & PRECISION
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