Information and Operations Management 20100102 for BB 4 Per Page_2

7/31/2019 Information and Operations Management 20100102 for BB 4 Per Page_2

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Information Technology that converts

data to information Success! ?

Use of information.

Businessmodels.

Businessprocesses.

ITSuccessfactors

include:



Use of information.Businessmodels.

Businessprocesses.

ITSuccess

factorsinclude: OperationsManagement

OperationsManagement?

OperationsManagement dealswith the design and

management ofproducts,

processes, servicesand supply chains

Information and

Communication in Business

Information and Operations

Management

Kroenke chapter 1, 2, 7, and a bit of chapter 8

What do we mean by data?

What do we mean by information?

What do we mean by knowledge?

Are they different?

Measures of information quality

What sorts of features makeinformation worth having, i.e. useful?

accuracy

accessibility

timeliness

organisation

relevance

cost effectiveness

decision oriented

completeness

verifiability

reliability

simplicity

security

surprise value


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Information?

Data the actual values recorded in a system

Information the meaning of those values asunderstood by some user of the system

DataData TransformationProcess

TransformationProcess

InformationInformation

Medical Record

Same data;different transformation;

different information.

Doctors infoDoctorreads

Nurses infoNursereads

Patients infoPatientreads

The aim of Information Systems is to

convert data to useful information, is that

the end of the story??

Peter Senge believes that there is much more to it

than just this; he suggests the progression:

Data- facts

Information - meaning

Knowledge produce outcomes

Insight understand why

Wisdom do good

We have a long way to go!!

A grain of wisdom isA grain of wisdom isA grain of wisdom isA grain of wisdom is

worth an ounce ofworth an ounce ofworth an ounce ofworth an ounce of

knowledge, which is worthknowledge, which is worthknowledge, which is worthknowledge, which is worth

a ton of data.a ton of data.a ton of data.a ton of data.

-------- Neil LarsonNeil LarsonNeil LarsonNeil Larson

Knowledge

Information is data made more useful by

application of knowledge

knowing what info is required for a task or

decision

knowing what data is required to get theinformation

knowing how and where to get the relevant data

knowing how to transform the data intoinformation

understanding the meaning of the information



Use of information.

Businessmodels.

Businessprocesses.

ITSuccessfactors

include:

Knowledge management:

Capturing the expertise of an organisation from

every possible source - peoples heads, paper

documents, computer systems - and making it

available to others in the organisation who need it.

tacit knowledge

explicit knowledge

Difficulties:

people problems

technical problems

A Business Model

a summary of how a business will

generate revenue, identifying

the products it will offer

its value-added services

its revenue sources

its target customers

an architecture for flow of products,

services, and information


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Business processes:

how organisations operate

the sequences of activities that must be

performed to transform inputs into outputs

Stair & Reynolds

Adding the e has changed business

process for many organisations:

Organisations are systems:

A system is

a collection of interrelated parts . . .

that work together for a common goal . . .

by accepting inputs . . .

and producing outputs . . .through an organised transformation process.

Systems consist of subsystems, and are part of

larger systems

Business processes depend onorganisational structure

Organizational structure: Organizational

subunits and the way they are related to the

overall organization

Hierarchical organizational structure

Series of levels

Those at high levels have more power andauthority within an organization

Executive

Managers

Mid-Level Managers

Technical and Supervisors

Professional Workers

Clerical Workers

A hierarchical organisational structure

Project organizational structure

a structure centred on major products or services

B. Woods,

ChairmanOff the Planet Inc.

T. White,Director,

Aircraft Division

W. Butler,Director,

Aerospace Division

G. Searle, Director,Communications &

Satellite Division

Director,Finance

Director,

Marketing

Director,

Production

Director,

Finance

Director,

Marketing

Director,

Production

Director,

Sales

Director,

Finance

Director,

Marketing

Director,

Production

Director,

SalesDirec

Sal


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Traditional Hierarchical

Organizational Structure

U. Grant,

Chief ExecutiveOfficer

B. Lee,

Director ofAccounting

C. Gregg,

Chief InformationOfficer

R. Haines,

Director ofMarketing

G. Lincoln,

Chief Engineer

B. Mann,

Director, HumanResources

S. SamuelDirectorAircraft Production

L. SmithDirectorSatellite and Communications

- organised by

business function

Multidimensional Organizational Structure

Director,

Marketing

Director,

Production

Director,

Finance

Publisher,

Tertiary Division

Marketing

Group

Production

Group

Finance

Group

Publisher,Retail Division MarketingGroup ProductionGroup FinanceGroup

Publisher,

High School

Division

Marketing

Group

Production

Group

Finance

Group

a structure that may incorporate severalstructures at the same time

Team organizational structure

An organizational structure centred on work

teams or groups, often transitory

Flat organizational structure

An organizational structure with a reduced

number of layers of management

Empowerment: giving employees and theirmanagers more power, responsibility, and

authority to make decisions, take certainactions, and have more control over their jobs

input:input: data the values physically recorded in thesystem

output:output: information the meaning of those values asunderstood by some user

process:process: a set of logically related tasks performed toachieve a defined outcome

environment:environment: the world outside the system

objective:objective: to further the goals of the organisationwithin which it functions, e.g. by transforming data intoinformation that is useful to the organisation, or byproviding support for business processes

Business processes need support

from Information Systems

Boundary (Scope)

Environment

Storage

Processing

Internal

Feedback

External

Feedback

DataInformation

Objective?

Does an information system

require a computer?


5/14

A computer-based information

system

Computer-based information systemComputer-based information system

hardwarehardware softwaresoftware

proceduresproceduresdatadata

CPUdiskkeyboardmousemonitor

printernetwork

manualcomputerised

peoplepeople

managers

usersanalystsprogrammerstechnologists

computer systemcomputer system

systemsoftwareapplication

software

manualcomputerised

A set of hardware, software, data, people, and

procedures that work together to produce

information

Information Systems provide. . .

Transaction processing

Collaboration tools, and office automation

Process control

Information for managers

Support for decision making

AI applications in business

Transaction Processing

Transaction:

any business related exchange

Some of Together Weddingstransactions:

Signing up a new client

Recording consultation

hours with clients

Hiring a new Wedding

planner

Booking a venue

Overview of transaction

processing

Data Collection

process of gathering all necessary data

ideally captured at source

bar code scanning at supermarket

on-line tutorial registration can be used to measure employee

performance

Basic Steps of transaction

processing


6/14


processing

DocumentProduction

Storage

DataManipulationData

Correction

Data Edit

DataCollection

correct

incorrect

TPS reports

How would I prevent errors when

transactions are recorded in an Excel

spreadsheet?

you cant!

BUT you canprevent some.

Data/Validation

Data Editing

as the data is captured it is checked for validity

and completeness

Data Correction

system should provide some means of correcting

invalid input.

Basic Steps of transactionprocessing

Document Production

payslips

transaction receipts

delivery dockets

invoices

reports

items on order from a supplier

current inventory


processing

Data Manipulation

could involve classifying the data, sorting it,calculating values, and summarising results

Data Storage

data is stored in one or more databases. The

data can then be used for further processing byother systems


processingMethods of Transaction

Processing batch

transactions are accumulated over a period of timeand prepared for processing as a single unit or batch.

online transaction processing (OLTP) each transaction is processed immediately and theaffected records are updated

used for e-commerce applications

online entry with delayed processing transactions are entered into the system as they occur,

but they are not processed immediately


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The business processes that

involve transaction

processing are so critical to

the businesss operation that

they are sometimes referredto as the

lifeblood of the

organisation

Control and Management Issues Business Continuity Planning

the process of anticipating, preventing, and

providing for recovery from problems

implementing backup procedures

Focus:

maintaining the integrity of corporate information

keeping key information systems running

Disaster Recovery

implementing the business resumption plan

after a disaster

Causes of Problems / Disasters

Malicious damage

Deliberate

Accidental Equipment failure

Telecommunications,LAN failure

Equipment breakdowns

Physical security

Equipment

Building Natural disaster

Flood

Electrical storm

Fire

But prevention is better than cure . . .

Redundancy

Critical hardware /software components

Computers

Communications

Backup

Full

Incremental

Testing by restoring

Off-site storage of

backup data

Security

Unauthorised access to system Software controlled

Physical access control

Preventative measures Camera

Security personnel

Virus Protection

Scanning for viruses

Updating virus software

Staff awareness and motivation

How do businesses exchange

transactions with each other?

Electronic Data Interchange

(EDI) computer to computer exchange of

transactions

from standard business

documents

in standard data formats

replaces paper

but the basic business processes remain the same


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What does that zig-zag line represent? Information Systems provide. . .



Process control




Collaboration tools, and office

automation Project management

Personal productivity tools

Collaboration technologies




Process control




TEAM DYNAMICS

e-Mail, Electronic Bulletin Boards

Electronic Meeting Support

Group Scheduling Software

Videoconferencing Software

Whiteboard Software

Workflow Systems

DOCUMENTMANAGEMENT

A database that stores andorganises documents for a group

and manages access to them

Collaboration

Technologies Process Control- control of machinery and production processes

computers control

lathes, mills, robots,

entire production lines

outside our scope


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Process control




Good management is becoming

more complex . . . globalisation

the advent of a global economy, in whichproducts and services flow relatively freelyaround the globe

expanding markets

more intense competition

shorter product life cycle

more complex government regulation

the information revolution

ecommerce

What does management do?

Plan

Control

Direct

Organise

objectives,strategies and

tactics

money, people,material and

management

structurecommunicate,

instruct and motivate

measure performance /

take correctiveaction.

What do each of the management tasks (planning,

organising, directing and controlling) at any

management level have in common?

To make good decisions, managers need

access to quality information.

Decision making


Summarized reports: predefined reports thataggregate information e.g

Key-indicator reports

summarize the previous days critical activities

typically available at the beginning of each workday

Comparative reports show two or more sets of similar information to

illustrate a relationship

Summarized reports may be

Periodic: produced periodically on a schedule (daily,weekly, monthly)

Ad hoc: generated only when a manager requests them

Sample reports

for managers

[Figure 9.2]

continued...

(a) Periodic Report


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Exception reports

Automatically produced when a situation isunusual or requires management action

e.g a report produced to show any project thatis more than $10,000 over budget

trigger points need to be carefully set!

Sample reports

for managers

[Figure 9.2 continued]

(c) Ad hoc Report

Case Study Part 2 Information Systems provide. . .



Process control




You will be creating a simple system to

support Together Weddings business

operations

Transaction Processing:

Employing a new wedding planner

Signing up a new client

Changing a clients details

Recording consultation details

Information for managers: Average number of guests catered for at events

Summary of events in each calendar year

An alternative way to classifyinformation systems - by business

function:


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Traditional Hierarchical

Organizational Structure

U. Grant,

Chief ExecutiveOfficer

B. Lee,

Director ofAccounting

C. Gregg,

Chief InformationOfficer

R. Haines,

Director ofMarketing

G. Lincoln,

Chief Engineer

B. Mann,

Director, HumanResources

S. Samuel

DirectorAircraft Production

L. Smith

DirectorSatellite and Communications

- organised by

business function

An alternative way to classify information

systems - by business function:

Production /Manufacturing

Sales /Marketing

Human ResourceManagement

OperationsAccounting /Finance

Functional

BusinessSystems

Kroenke Fig 7-4

Functions of a Salesand MarketingSystem:

Lead-generation

Lead-tracking

Customer

management

Sales forecasting

Product and brand

management

Adapted from: Kroenke Fig 7-6

Functions of an

OperationsInformation

System

order entry

ordermanagement

finished-goods

inventorymanagement

customer

service

Adapted from Kroenke Fig 7-7

Functions of a

manufacturing

information system

inventory

manufacturing planning

manufacturing

scheduling

MRP

MRP II

manufacturing operations


Functions of a combined accounting and finance

information system


12/14


Functions of a

Human Resources

Information System

recruiting

assessment

planning

compensation

development andtraining

Kroenke Fig 7-13 Major Problems of IsolatedFunctional Systems

Functional information systems

dont integrate business processes

and datathroughout an organization

Problem!

Todays trend:

a strategic

approach

to

business

systems . . .

Customer relationship management

Enterprise resource planning

Enterprise application integration

Cross-functional systems . . .

Remember that organisations

are systems, and

Systems consist of subsystems

Subsystems interact with and affect each

other

So it makes sense that

Information systems that support anorganisations subsystems should interact

with each other

Customer Relationship

Management Systems (CRM)

use information about customers to gain

insights into their needs, wants, and

behaviours in order to serve them better

may include sales force automation customer service and support


13/14

Customer relationship management

crosses functional boundaries . . .

Sales and Marketing

Human Resources

Accounting and FinanceOperations


Major components of a typical Customer

Relationship Management (CRM) system

A collection of software modules that together

integrate ALL the organisations transaction

processing using a common database

Enterprise Resource Planning

(ERP) Systems

Some characteristics:

ERP systems . . .

Some benefits:

When an ERP system is inappropriate for an

organization, it can still integrate its existingsystems by creating special software to connectsystems together.

Enterprise application integration enables a

businesss existing applications to communicateand share data, providing many of the benefitsof a cross-functional system without some ofthe disadvantages.

Enterprise application integration(EAI)

Lower costs to implement thana full ERP.

Less disruption to operationsand employees.

Integration of selected parts ofthe organization.

A step-wise implementationprocess that allows thebusiness eventually to achievethe full benefits of an ERP.

Enterprise application integration . . .

Some benefits:


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Enterprise application integration

systems

act as an intermediary to enable existing

functional systems to automatically

exchange data

take data from the sending system andconvert it into a format suitable for the

receiving system to process

combine data from several systems

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