Management Information Systems:

Managing the Digital Firm

Seventeenth Edition

Chapter 2
Global E-Business and
Collaboration

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MIS & Global E-Business

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Learning Objectives
1 What are business processes? How are they related to
information systems?
2 How do systems serve the different management groups in
a business, and how do systems that link the enterprise
improve organizational performance?
3 Why are systems for collaboration and social business so
important, and what technologies do they use?
4 What is the role of the information systems function in a
business?

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 Business Processes
and Information Systems

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What is a business process?

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Business Processes
• Business processes
– Flows of material, information, knowledge
– Logically related set of tasks that define how specific
business tasks are performed
– May be tied to functional area or be cross-functional
• Businesses: Can be seen as collection of business
processes
• Business processes may be assets or liabilities

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Business Processes
• Examples of functional business processes
– Manufacturing and production
 Assembling the product
– Sales and marketing
 Identifying customers
– Finance and accounting
 Creating financial statements
– Human resources
 Hiring employees
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Figure 2.1 The Order Fulfillment Process

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How Information Technology Improves
Business Processes
• Increasing efficiency of existing processes
– Automating steps that were manual
• Enabling entirely new processes
– Changing flow of information
– Replacing sequential steps with parallel steps
– Eliminating delays in decision making
– Supporting new business models

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Types of Information Systems

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Types of Information Systems
• Systems for Management
– Provide support for management
 Transaction Processing Systems (TPS) & Business
Intelligence (MIS, DSS, ESS)

• Systems for Enterprise

– Provide link within enterprise
 Enterprise Applications (ERP, SCM, CRM, KM)
 Intranet and Extranet

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Systems for Management Support
• Transaction processing systems (TPS)
– Serve operational managers and staff
– Perform and record daily routine transactions necessary to
conduct business
 Examples: sales order entry, payroll, shipping
– Allow managers to monitor status of operations and
relations with external environment
– Serve predefined, structured goals and decision making

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Figure 2.2 A Payroll TP S

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Systems for Management Support
• Systems for business intelligence
– Data and software tools for organizing and analyzing
data
– Used to help managers and users make improved
decisions
 Management information systems (MIS)
 Decision support systems (DSS)
 Executive support systems (ESS)
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Management Information Systems
• Serve middle management
• Provide reports on firm’s current performance, based on
data from TP S
• Provide answers to routine questions with predefined
procedure for answering them
• Typically have little analytic capability

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Figure 2.3 How Management Information
Systems Obtain Their Data from the
Organization’s TP S

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Figure 2.4 Sample MI S Report
Consolidated Consumer Products Corporation Sales by Product and Sales Region: 2020

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Decision Support Systems
• Serve middle management
• Support nonroutine decision making
– Example: What is the impact on production schedule if
December sales doubled?
• May use external information as well as TP S / M I S data
• Model driven DS S
– Voyage-estimating systems
• Data driven DS S
– Intrawest’s marketing analysis systems
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Figure 2.5 Voyage-Estimating Decision-
Support System

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Executive Support Systems
• Support senior management
• Address nonroutine decisions
– Requiring judgment, evaluation, and insight
• Incorporate data about external events (e.g., new tax laws
or competitors) as well as summarized information from
internal MI S and DS S
• Example: Digital dashboard with real-time view of firm’s
financial performance
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Types of Information Systems
• Systems for Management
– Provide support for management
 Transaction Processing Systems (TPS) & Business
Intelligence (MIS, DSS, ESS)

• Systems for Enterprise

– Provide link within enterprise
 Enterprise Applications, Supply Chain Management, Customer
Relationship Management, & Knowledge Management
 Intranet and Extranet
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Enterprise Applications
• Systems for linking the enterprise
• Span functional areas
• Execute business processes across the firm
• Include all levels of management
• Four major applications
– Enterprise systems
– Supply chain management systems
– Customer relationship management systems
– Knowledge management systems
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Activity
• In breakout rooms, discuss enterprise systems, SCM,
CRM and KM
• 5 minutes
• Discuss it to your classmates what your group says.

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Figure 2.6 Enterprise Application Architecture

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Enterprise Systems
• Also called enterprise resource planning (ER P) systems
• Integrate data from key business processes into single
system
• Speed communication of information throughout firm
• Enable greater flexibility in responding to customer
requests, greater accuracy in order fulfillment
• Enable managers to assemble overall view of operations

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Supply Chain Management (SC M)
Systems
• Manage relationships with suppliers, purchasing firms,
distributors, and logistics companies
• Manage shared information about orders, production, inventory
levels, and so on
• Goal is to move correct amount of product from source to point
of consumption as quickly as possible and at lowest cost
• Type of interorganizational system: Automating flow of
information across organizational boundaries

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Customer Relationship Management
(CR M) Systems
• Help manage relationship with customers
• Coordinate business processes that deal with customers in sales,
marketing, and customer service
• Goals:
– Optimize revenue
– Improve customer satisfaction
– Increase customer retention
– Identify and retain most profitable customers
– Increase sales
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Knowledge Management Systems
(KMS)
• Manage processes for capturing and applying knowledge
and expertise
• Collect relevant knowledge and make it available wherever
needed in the enterprise to improve business processes
and management decisions
• Link firm to external sources of knowledge

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Intranets and Extranets
• Technology platforms that increase integration and
expedite the flow of information
• Intranets:
– Internal networks based on Internet standards
– Often are private access area in company’s website
• Extranets:
– Company websites accessible only to authorized
vendors and suppliers
– Facilitate collaboration
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E-business, E-commerce, and
E-government
• E-business
– Use of digital technology and Internet to drive major
business processes
• E-commerce
– Subset of e-business
– Buying and selling goods and services through Internet
• E-government
– Using Internet technology to deliver information and
services to citizens, employees, and businesses
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Systems for Collaboration

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What is Collaboration?
• Collaboration in business
– Short lived or long term
– Informal or formal (teams)

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Why Collaborate?
• Growing importance of collaboration
– Changing nature of work
– Growth of professional work—“interaction jobs”
– Changing organization of the firm
– Changing scope of the firm
– Emphasis on innovation
– Changing culture of work

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Business Benefits of Collaboration
and Teamwork
• Investment in collaboration technology can return large
rewards, especially in sales and marketing, research and
development
– Productivity: Sharing knowledge and resolving problems
– Quality: Faster resolution of quality issues
– Innovation: More ideas for products and services
– Customer service: Complaints handled effectively
– Financial performance: Generated by improvements in
factors above
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Figure 2.7 Requirements for Collaboration

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Building a Collaborative Culture and
Business Processes
• “Command and control” organizations
– No value placed on teamwork or lower-level
participation in decisions
• Collaborative business culture
– Senior managers rely on teams of employees
– Policies, products, designs, processes, and systems
rely on teams
– The managers purpose is to build teams
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Tools and Technologies for
Collaboration and Social Business
• E-mail and instant messaging (I M)
• Wikis
• Virtual worlds
• Collaboration and social business platforms
– Virtual meeting systems: videoconferencing, telepresence)
– Cloud collaboration services (Google Drive, Google Docs,
etc.)
– Microsoft SharePoint and IB M Notes
– Enterprise social networking tools
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Checklist for Managers: Evaluating and
Selecting Collaboration and Social Software
Tools
• Time/space matrix
• Six steps in evaluating software tools
– Identify your firm’s collaboration challenges
– Identify what kinds of solutions are available
– Analyze available products’ cost and benefits
– Evaluate security risks
– Consult users for implementation and training issues
– Evaluate product vendors
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Figure 2.8 The Time/Space
Collaboration and Social Tool Matrix

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Information Systems
Functions in Business

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The Information Systems Department
• Often headed by chief information officer (CI O)
– Other senior positions include chief security officer
(CS O), chief knowledge officer (CK O), chief privacy
officer (CP O), chief data officer (CD O)
• Programmers
• Systems analysts
• Information systems managers
• End users
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Organizing the Information Systems
Function
• I T governance
– Strategies and policies for using I T in the organization
– Decision rights
– Accountability
– Organization of information systems function
 Centralized, decentralized, and so on

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Questions?

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