Master of International Tourism and Hospitality Management - Information System

This system of adopted to collect, store, process and produce information relating to the specific business activity. The system utilizes input, processing and output capabilities. Input components collect data which is processed and based on the analysis information is produced by the output components (Zwass, 2017). The most practical illustration of an effective transaction processing system is the online booking of tickets in the flight industry. The booking process and ticket issuance have been automated wherein travelers make a flight plan and seat booking online. The flight schedule and the selected seat are the inputs for data collection. The system then provides a list of available seats in the processing phase after which the output is released in form of a ticket. A transaction processing system can also be utilized by other business to enhance real-time information access by clients.

Customer relationship management system

Business needs of marketing and coordinated sales plan are effectively performed by a customer relationship management system (Sherman, 2018). This system assembles customer related information such as development of purchasing patterns, products reviews and customer complaints. A customer relationship system facilitates direct customer interaction with the business in matters revolving around products and services. An organization may also make use of a CRM system to create a platform for open discussion partners on ideas and opinions as well as real-time access to critical information even when those interested in the business are in different localities.

Business intelligence system

Business intelligence systems are complicated. This is because they combine information from all sectors of business operations to inform decision making and make projections with regard to sales and expected revenues (Zwass, 2017). Business intelligence systems are most common in financial institutions. They use business intelligence systems to generate information on credit risk. The system basically analyzes the amount of credit given and uses the information to extrapolate potential credit default risk.

Knowledge management system

This system has the capacity to arrange, breakdown and disseminate information among individuals within an organization. The primary goal of knowledge management system is to promote innovation, enhance performance, and facilitate incorporation and maintenance of knowledge within an organization (Zwass, 2017). This system is common in large organizations but can still benefit small enterprises from knowledge harnessing.

Potentials of an effective information system

An effective information system has the capacity to yield substantial benefits to a business. It is obvious that with the current level of technology and technological advancements that are happening daily an information system is prerequisite in any organization regardless of the area of specialization. An effective information system should align with the specific goals and objectives of an organization (Gupta, 2011).

With an appropriately incorporated information system, an organization is likely to experience improved levels of innovation and increased competitiveness (Gupta, 2011). Innovation results to competitiveness that usually translates to more sales and higher revenues. A competitive organization is one in which customers have more inclination to either due to high quality goods and services or improved customer relations (Zwass, 2017). Therefore an effective information system is more likely to improve the business-customer relationship and enhance quality of products and services factors that often result in increased sales.

A business with an information system saves greatly on time and money and makes decisions that are way smarter and informed that businesses without an information system (Gupta, 2011).

The complex operations carried out by information systems have been beneficial to businesses with respect to human error minimization (Gupta, 2011). The automated procedures that are conducted by the information systems offer an opportunity for employees to embark on other more important activities. Information systems have eliminated the long processes of manual collection and analysis of data and excessive paperwork.

Internal Factors Influencing Efficiency of Information System

Internal factors that may influence the effectiveness of an information system include; business goal, leadership, communication and training or learning.

A business goal translates to its mission. An effective business information system must align to the business goal and objectives (Stair, 2017.).

Failure to align the two renders an information system a liability as opposed to being an asset. It is clear that many information systems in organizations fail due to a conflict between the organization goals that often measure their success and the appropriateness of Information system in facilitating achievement of that goal (Stair, 2017.).

An organization’s leadership is critical in adopting and embracing an information system. The leadership of an organization is responsible for making decisions that are most critical concerning business performance. It is the primary role of leaders to facilitate and communicate the most important information system that best suits the business. Hybrid organization leadership with technical, political and administrative expertise successfully integrates information systems and technology into organizations. The organization leadership is able to identify and attend to the social and human conflicts that tend to arise upon integration of a new system into the organization and this is fundamental for acceptance by those working under the management.

Communication is very crucial in any business operation. For an information system to be effective, it must be communicated to all the stakeholders to prevent possible conflicts from arising. A clearly communicated and elaborated information system is more easily to be embraced, accepted and utilized by employees for the best of the business. Robust communication practices have enabled many organizations to thrive.

Training is another very critical component as far as information system is concerned. At the moment of introduction, the human resource needs to be trained on the skills required to engage with the information system in question. Lack of knowledge on the benefits and usefulness of an IT system will render it fruitless and unnecessary. Many information system projects mail due to technical problems associated with the system. Inadequate or poor planning, poor estimation and the wrong choice of an information system all lead to poor information system management from a technical perspective. In addition, many organizations are reluctant to train their human resources in matters pertaining to the appropriate implementation of an information system. There are organizations that tend to recruit personnel that are unskilled or partially skilled because they are unwilling to pay an expert in information system. This could also lead to information system project failure.

In general for successful information system projects, an organization must put into consideration a number of factors. The first and most important factor is the quality and quantity of task that the information system is required to perform. Secondly is the personnel needed to engage with the system and lastly the involvement of the system in meeting the business needs. Success of information systems from an internal business factors point of view is measured primarily by the content’s accuracy, format, ease of use, timeliness.

External Factors Influencing the Success of an Information System

External factors relating to a business are those that affect the position of the business in the industry. They are the factors that directly determine the amount of sales by an organization, client loyalty and overall revenues likely to be generated. External factors of an organization influence the public’s perception of an organization. External factors are directly linked to innovation and competitiveness of an organization that is presently a factor of the information system deployed by an organization.

Information systems determine how organizations overcome the competitive forces in an industry. Ability to overcome the competitive forces guarantees an organization the opportunity to enjoy the competitive advantages which is critical for all organizations. A competitive advantage translates to a product or service that is valued more by customers than similar products and services from a competitor. It is important to note that competitive advantage is not a permanent thing. This is because; competitors strive by all means to achieve it. This means that an organization must commit itself to maintain its competitiveness through thorough analysis of competitive forces and strategies they can use to overcome them (Stair, 2017.). Competitive forces could either be the rivalry between competitors within the same industry or new entrants into the industry. Another force is the intimidation and danger associated with substitute products. The bargaining power of both customers and suppliers is yet another critical factor that a business must put into consideration (Stair, 2017.).

Effective Information system has the capacity of enhancing the competitiveness of an organization. It can help reduce the cost of products and services though a good relationship with customers and suppliers that will collaborate in achieving this. Examples of ways that businesses could reduce their cost of products and services include using online business to consumer and business to business models, e-procurement systems that lower operational costs (Abramowicz & Kokkinak, 2014). This is achieved by an information system. An online build to order, bid and/or auction are al strategic information systems that enable reduced cost of production.

Through an information system, innovation is promoted and in most cases with innovation an organization is capable of developing new strategies of differentiating or diversifying its products and services with respect to customer needs. In addition innovation within a business facilitates new ways of doing business to develop distinct products and services, identifying irreplaceable market and market niches. Innovation is achieved through strategic information system such as: online discount stock trades, package tracking, flight management and online customer systems. Of great importance is the acknowledgement of customers as innovation initiators and drivers. It is customers’ needs that make an organization to diversify its products and develop new ones. Customers are used in the testing of new products to facilitate desirable changes with respect to a product. It is therefore correct to conclude that a customer is very important to a business and a good customer relation is of great significance in driving innovation and for competitive position.

With an effective information system and innovation, growth is guaranteed and an organization is capable of expanding into global markets by use of efficient business links with customers, suppliers, competitors and other companies (Sherman, 2018). Intranet and internet enabled growth is possible with an information system. Online merchandise ordering and online inventory tracking are examples of strategic information systems that can enhance business growth.

In general, external business factors such as market, competition and innovation determines the position of an organization in business. Information systems have been proved to be ideal drivers of innovation and competition. Strategic information systems have been critical in enhancing customer relationship which is the most and exclusively fundamental component of business performance. However, an information system must be in line with the overall goal of a business failure to which it will be of little or no importance.

Conclusion

In conclusion, information systems are fundamental in any business operation. Strategic information systems are deployed to serve specific business needs. There are basically four broad categories of information systems that are of great use to business and include TPS (Transaction Processing System), CRM (Customer Relationship Management System), BIS (Business Intelligence System) and KMS (Knowledge Management System). These systems serve unique business needs and facilitate the competitiveness of a business in the industry. The technologies are used to create virtual customers, design new products, and connect with customers and suppliers for enquiries and making of orders among other customer related activities. Generally, information systems have greatly promoted innovation in organizations. Innovation is critical in overcoming competitive forces of rivalry between competitors, new entries, substitute product and customer/suppliers bargaining powers. To maintain the achieved competitive advantage an organization must commit by embracing the most effective information system that best aligns with the business needs. Additionally, an organization must willingly recruit expertly trained personnel and accommodate the changes that are associated with information systems.

Strategic information systems provides collaborative platform that enable business managers to communicate with partners and other shareholders through portals and supply chain systems. Organizations are able to achieve accurate, quality and speedy operations mediated by the technology based information systems. Organizations are now in a position to create virtual companies by use of internet, intranet and extranet links to bring together people, essential assets and ideas. It is therefore recommended that business identify an information system that is most practical for their business operations to yield the benefits of technology based information systems. Failure to carefully align business goals with the need for information system renders the integration of an information system nothing but a significantly inappropriate investment.

Reference

Abramowicz, W., & Kokkinak, A. (2014). Business Information Systems Workshops : BIS 2014 International Workshops, Larnaca, Cyprus, May 22-23, 2014, Revised Papers. Cham : Springer, 2014.

Association., Information Resources Management. (2010). Business information systems : concepts, methodologies, tools, and applications. Hershey: Hershey, Pa. : IGI Global, 2010.

Gupta, H. (2011). Management information system : (an insight). New Delhi: International Book House, ©2011.

Hingarh, V., & Ahmed, A. (2013). Understanding and conducting information systems auditing. Singapore : John Wiley & Sons Singapore Pte. Ltd., 2013.

Sherman, F. (2018, june 26). Retrieved November 27, 2018, from Chron- small business: https://smallbusiness.chron.com/internal-external-environmental-factors-affect-business-69474.htm

Stair, R. M. ( 2017.). Fundamentals of Information Systems. Course Technology.

Zandbergen, P. (2018). What is an Information System? Retrieved November 27, 2018, from Study: https://study.com/academy/lesson/what-are-information-systems-definition-types-quiz.html

Zwass, V. (2017, December 28). Information system. Retrieved November 27, 2018, from Britannica: https://www.britannica.com/topic/information-system