Week 2 Discussion Management of Information Systems

Week 2 Lecture 1 - Business Functions and Supply Chains

 

Management of Information Systems

Business Functions and Supply Chains

Effectiveness and efficiency

1. Often, the terms efficiency and effectiveness are used interchangeably. However, these terms are different with important distinctions. Effectiveness is the degree that something produces a desired result. Effectiveness is how well a task is completed. A system’s efficiency refers to the ratio of required input to the useful output produced. The input of time influences both effectiveness and efficiency.

. A service is considered more effective when less time, is taken to render it. Additionally, the service’s efficiency is greater because fewer resources are used, and less time passes.

. Productivity is labor efficiency, the ratio of the labor input to the product output. IT and software enable the need for less labor to achieve an unchanged or greater output and increased value. IT and software enable reallocation of resources and labor to other roles that enhance organizational value.

Figure 1 Input-process-output © Cengage Learning 2015

IS support of business processes

Finance, manufacturing, marketing, and engineering are the main business areas supported by information systems.

Business partners could be manufacturers, suppliers, and distributors. To meet a consistently tight schedule, partners may implement just-in-time (JIT) processes to produce, supply and distribute products. JIT systems require the sharing of information between business partners. To implement JIT systems, IS is shared among companies linking their enterprise resource planning (ERP) systems. Connecting ERP systems enable partners to achieve JIT or near JIT states. JIT processes significantly reduce warehousing costs.

Supply chain

The term “supply chain” is not only for logistics. The “chain” includes all stages of a company’s activities. It includes purchasing raw materials, manufacturing, packaging, shipping, invoicing, remittance and after-purchase maintenance and support activities.

Figure 2 Business activities consist of customer relationship management, supply chain management, and supporting functions © Cengage Learning 2015

See  Porter’s Value Chain  at  http://en.wikipedia.org/wiki/Value_chain .

Companies might interconnect with several manufacturers to produce one part of the production sequence. Trade in this vertical manner may be regarded as one link in the supply chain. The vertical supply chain that constitutes the link may consist of different organizations.

Quantitative analysis

Numbers are important to well-managed organizations. Quantitative analysis of numbers is required to understand all aspects of a company’s activities on which to base decisions. When decisions are made, the “numbers” are important, units such as miles, hours, units of currency, and cubic lengths, represent transportation distances, production times, product costs, material costs, shipping costs, and storage space. The “numbers” do not reflect 100% of a company’s status. However, quantitative analysis is crucial for well-managed organizations.

Interdependency and the “ripple effect”

Integrated IT systems and the individuals responsible for completing business functions are interdependent.

Figure 3 Information systems in different business functions are interdependent © Cengage Learning 2015

The order fulfillment cycle time is composed of 1) order processing times, 2) material lead times, 3) assembly lead times, 4) distribution lead times, and 5) installation lead times. These lead times in the order fulfillment cycle propagate across the supply chain and the differences in lead times at any stage can affect the execution of other phases and result in unreliable overall order cycle time (Luna & Stefansson, 2012; Sousa & Oz, 2015). This influence on the order fulfillment cycle time is called the “ripple effect.”

References

· Luna, F., & Stefansson, B. (2012). Economic Simulations in Swarm: Agent-Based Modelling and Object Oriented Programming. Springer Science & Business Media.

· Sousa, K., & Oz, E. (2015). Management Information Systems, 7th Edition. Cengage Learning.

Week 2 Lecture 2 - Business Hardware

 

Management of Information Systems

Business Hardware

Hardware is relevant to business. Knowledge workers should be able to discuss what hardware is available and should know how to evaluate hardware. Storage devices and technology convergence into single devices has increased productivity and mobility.

Because computer equipment is used in knowledge work, regardless of specialization, knowledge workers need to be aware of computer equipment that they will purchase, use, update and replace during their careers. Most people need a reasonable knowledge of computer equipment to make effective decisions about purchase, use, update and replacement. Research and decision making about computer equipment are common. Individuals need a reasonable knowledge level to make effective decisions about computer equipment.

In the past 60 years, many advances in computer technology occurred. Computers now contain multiple CPUs that increased the speed that instructions are processed. Innovations in storage, the Internet, and memory has enabled access to and processing of more information. Although advances have occurred, most computers still function based on how they were designed 60 years ago.

The computer technology includes input devices, output devices, internal memory, and external storage devices.

The business aspects of computer technology involve consideration of the cost–benefit of different storage media, computers, and peripheral equipment.

Digital devices change; cameras, televisions, GPS, media players, telephones, and handheld computers are merging into single devices.