Information Systems for Management

Introduction

The information systems for management support in business include Management Information Systems (MIS) and Executive Information Systems (EIS). MIS is a set of elements for collection, processing, storage, and provision of information related to the activities of the organization. Being in connection with each other and forming certain integrity, the main components contain software, technical means, and service staff. MIS aims at reporting and displaying the current state of the organization.

For example, daily sales analysis reports or assessments of a project are the most common forms of MIS. This type of information system focuses on the following management strategy: medium-term planning, analysis, and organization of work within a few weeks or months, for example, analysis and planning of the supply, sale, and preparation of production programs. Information provided by this information management system usually represents regular or special management reports. They include information about the past and present of a certain process or a project. Therefore, it becomes possible to obtain the most probable variant of the company’s future development.

In its turn, EIS ensures senior management, namely, executives and managers, with the required information in a format that they prefer. This critical information primarily focuses on the organization’s external environment yet the internal issues are also taken into account. Also, particular attention is paid to the design of the EIS user-friendly interface. It is simple and intuitive to use. The functions of reporting and the possibility of the complete analysis of the data are considered in detail. In general, EIS is a decision support system adapted for executives. It helps to identify, compare, and analyze the most important changes in the market and address emerging business challenges in the most effective manner.

Analysis

Some organizations tend to apply information systems to collaborate with partners using inter-organizational relationships. For example, FedEx has a partnership database that provides real-time information related to all partners. The latter can easily get access to this database to receive information concerning existing partnerships. Furthermore, the partners can access this information from anywhere and anytime that makes the process of managing more comfortable.

The great advantage of this system is that it can prevent a conflict of interests between the partners. Also, the database helps to predict future business opportunities and failures in relationships with the partners. By reporting and tracking the organization’s alliances, the database promotes its progress.

Another example is an alliance between Hewlett-Packard and Oracle that joined their efforts to offer software for databases and infrastructure organizations. Hewlett-Packard and Oracle also develop joint proposals in the field of application management and its implementation. The development includes services for infrastructure, middleware, and hosting along with Oracle’s experience in providing flexible solutions for business management in the framework of a corporate Intranet.

The cooperation of these companies was expanded through the collaborative efforts made to optimize the solutions concerning Tax and Revenue Management as well. The alliance employs best practices, Customer Relationship Management (CRM) applications, industry-leading analytics’ products, industry knowledge, and a number of business processes designed by Oracle. This integration makes it possible to create and provide both inter-branch and intra-organizational solutions.

Transaction Processing Systems (TPS) offer a variety of options the importance of which cannot be overestimated. The first advantage is the high reliability and accuracy of the information. At this point, it should be emphasized that the goals, objectives, and resources of TPS are precisely defined. Therefore, the risk of their performance is reduced to a minimum. The data is usually formalized. The rules are very strict, and the solutions are always structured. The second advantage is simplicity.

Due to both flow and structure of data that are identified evidently, the great volume of data can be controlled without difficulty. Third, information within TPS is not independent as it is usually performed in the form of applications that are to be incorporated into the business information systems. The most common example is the incorporation of such modules as LanDocs or LanStaff into interactive data processing. Fourth, timeliness is an evident benefit of real-time data processing that is provided in an online environment and performed as soon as a transaction occurs. Finally, efficiency is the fifth advantage of TPS.

Being a highly effective means of implementing operational processing, they are relevant for solving analytical processing tasks. It is possible to build an analytical report and even forecast future tendencies. However, the latter often requires knowledge of the data structure. Thus, the mentioned advantages clearly show that the use of transaction processing systems in the field of management is quite relevant.

Nowadays rapidly changing world sets new challenges and opportunities in the field of business. In this connection, business tends to be a customer-oriented to achieve a maximum of effectiveness and become competitive among the rivals. The organizations employ a CRM approach to establishing appropriate relationships with the customers. This involves a complete view of every customer and a comprehensive representation of a company to every customer. At this point, IT solutions are used to design, integrate, and automate the customer-serving processes. Thus, the most important goal of CRM systems is to provide one-to-one marketing by creating profitable relationships and understanding the customers’ expectations.

Speaking of Expert Systems in business, it is essential to point out the significance of managing at the level of the enterprise. One of the applications of the Expert Systems is data mining focusing on a knowledge base that is an integral component of the system. Using software resources such as an interface and an inference engine, a user can easily access the required facts and rules. After that, a user can begin the data mining process that refers to the finding of usable information in large data sets.

Data mining applies mathematical methods of analysis to identify current patterns and trends. Usually, such patterns cannot be detected during conventional data analysis as they are too complex. The data mining aims at sales evaluation by forecasting server load or server downtime, risk assessment, identification of groups of the target customers, and other issues. All in all, the core goal of data mining is associated with the necessity of analytical processing of large volumes of information collected by modern databases.

The Enterprise Information Portals (EIP) integrate MIS, DSS, EIS, and several other information systems in the framework of a Web-based interface.

Along with CRM that was described earlier, there are also Enterprise Resource Planning (ERP) and Supply Chain Management (SCM) systems promoting optimization, timeliness, and support of internal business processes in order to achieve the best possible performance. ERP is a set of integrated applications that create an incorporated information environment for automation of planning, control, accounting, and analysis of all key business operations.

This module implies forecasting, project and program management, maintaining information on products and technology, cost management, human resources, and other related components. Also, EIP is a system of the reorganization of the organization. Basically, there is a principle of creating a single repository containing all the corporate business information. In spite of the fact that initially ERP systems were originated in the manufacturing sector, today they have a wide range of applications. Modern ERP systems provide all the basic functions of the enterprise regardless of the type of business or a sector. Currently, ERP systems are used in both commercial and non-profit organizations.

In their turn, SCM systems act as the main strategic instrument of the organizations. SCM is a cross-functional and inter-enterprise system that is designed to help to integrate suppliers, manufacturers, distributors, and retailers effectively. Taking into account the service requirements of customers, SCM ensures the availability of the right product at the right time and in the right place with minimal costs.

In particular, SCM is the process of planning organization, execution, and control of raw material flows, work in process, and finished goods. Furthermore, it aims at ensuring efficient and fast service by receiving timely information about goods’ movements. The issues of coordination, planning, and management of procurement processes, production, storage, and distribution of goods and services are under the control of SCM. Even though it provides quick and strategic relationships with suppliers, SCM can be disadvantageous in case of the lack of knowledge and accuracy as well as failure to collaborate.