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Faculty Name: Muhammad Aqeel

INFROMATION SYSTEMS
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SYSTEM: It is a collection of inter-related objects
working together to achieve some common
objective, task or goal. e.g Computer System,
MANAGEMNT:
is responsible for smooth and proper
functioning of an Organization / Business.
INFORMATION:
processed facts which can be used in decision
making process
BUSINESS INFORMATION:
Information concerned with any business
is called BI
BASIC CONCEPTS
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INFORMATION SYSTEM:
An organized combination of people,
hardware, software, communications
network and data resources that collects,
transforms and disseminates information
in an organization.
CBIS COMPUTER BASED INFORMATION SYSTEM
BASIC CONCEPTS
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CBIS
Components of CBIS
Data
People
Hardware
Software
Communication Infrastructure
BASIC CONCEPTS
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Working Class / Clerical Staff
Strategic
Management
Tactical
Management
Operational
Management
Management Hierarchy
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Information Categories
Strategic Information
Derived from internal and external sources
Summarized at a high level
Relevant to the long term planning
Concerned with the whole organization
Often prepared on ad-hoc basis
Both qualitative and quantitative
May be incomplete or uncertain
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Information Categories
Tactical Information
Primarily generated from internal sources
Summarized at relatively low level
Relevant to the short and medium terms
Prepared routinely and regularly
Based on quantitative measures
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Information Categories
Operational Information
Derived from internal sources
Presents detailed transactional data
Relevant to the immediate term
Task specific applications
Prepared very frequently
Largely quantitative
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Information Characteristics
Accuracy
Completeness
Cost Effectiveness
User targeted
Relevance
Authenticity
Timeliness
Ease of use
Currency
Frequency
Validity
Verification
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Decision Theory
Decision Making
The cognitive process of reaching a
decision.
Selecting optimum strategy out of
multiple options leading to consequences
with variable probabilities
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TYPES of DECISION
Certain Decision
Based on Complete and Correct Information
Un-Certain Decision
Based on Correct but In-complete Information
Risky Decision
Based on Incorrect or unrealistic Information
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Customization Operations
Summarizing (preparing concise reports)
Grouping (division and accumulation)
Aggregation (combining into group/s)
Segregation (splitting information into groups)
Filtering (separating req. & non-required)
Sorting (arranging data acc. 2 criterion)
Searching (also known as queries)
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TYPES OF INFORMATION SYSTEM

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TYPES OF INFORMATION SYSTEM
Operation support Systems
TPS
PCS
ECS
Management Support Systems
MIS/MRS
DSS
EIS
OTHER CATEGORIES OF INFORMATION
SYSTEMS
KMS
Cross functional Information Systems
ERP
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TRANSACTION PROCESSING SYSTEMS (TPS)
Process data resulting from business transactions, update
operational databases and produce business documents.
Examples: order processing, inventory processing
accounting systems etc.

PROCESS CONTROL SYSTEMS (PCS)
Monitor and control industrial processes. Examples:
Petroleum Refining, Power Generation etc.

ENTERPRISE COLLABORATION SYSTEMS (ECS)
Support team, workgroup and enterprise communications
and collaboration. Example: e-mail, chat, video conferencing
etc.
OPERATION SUPPORT SYSTEMS
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Management information systems: Provide
information in the form of pre-specified reports and displays
(Screens) to support business decision making. Examples:
sales analysis, production performance, and cost trend
reporting systems.
Decision support systems: Provide interactive ad hoc
support for the decision-making processes of managers and
other business professionals. Examples: product pricing,
profitability forecasting, and risk analysis systems.
Executive information systems: Provide critical
information from many sources tailored to the information
needs of executives. Examples: systems for easy access to
analyses of business performance, actions of competitors,
and economic developments to support strategic planning.

MANAGEMENT SUPPORT SYSTEMS
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Expert systems: Knowledge-based systems that provide expert
advice and act as expert consultants to users. Examples: credit
application advisor, process monitor, and diagnostic maintenance
systems.
Knowledge management systems: Knowledge-based systems
that support the creation, organization, and dissemination of business
knowledge within the enterprise. Examples: intranet access to best
business practices, sales proposal strategies, and customer problem
resolution systems.
Strategic information systems: Support operations or
management processes that provide a firm with strategic products,
services and capabilities for competitive advantage. Examples: online
stock trading, shipment tracking, and e-commerce Web systems.
Functional business systems: Support a variety of
operational and managerial applications of the basic business
functions of a company. Examples: information systems that
support applications in accounting, finance, marketing,
operations management, and human resource management.
OTHER CATEGORIES OF INFORMATION SYSTEMS
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Cross functional Information systems that cross the
boundaries of traditional business functions in order
to reengineer and improve vital business processes
all across the enterprise. These organizations view
cross-functional enterprise systems as a strategic
way to use IT to share information resources and
improve the efficiency and effectiveness of
business processes, and develop strategic
relationships with customers, suppliers, and
business partners. These are also called Enterprise
System.
CROSS FUNCTIONAL INFORMATION SYSTEMS
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A type of Operation support system which process data
resulting from business transactions, update
operational databases and produce business
documents. Examples: order processing, inventory
processing accounting systems etc.
Different techniques are used in TPS to process
transactions are:
Batch processing (OFF LINE Processing)
Real time processing (ON LINE Processing)
Different types of documents generated by TPS are:
Information documents
Action documents
Turn around documents

TRANSACTION PROCESSING SYSTEMS (TPS)
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The transaction processing
cycle. Note that transaction
processing systems use a five
stage cycle:-
Data entry Activity
Transaction Processing
Database Maintenance,
Document and Report
generation, and
Inquiry Processing Activity
TRANSACTION PROCESSING CYCLE
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Enterprise collaboration systems (ECS) are cross-functional
information systems that enhance communication,
coordination, and collaboration among the members of
business teams and workgroups. Information technology,
especially Internet, Intranet and Extranet technologies are
used in these systems. The goal of these systems is to
enable us to work together more easily and effectively
by helping us to:
Communicate: Share information with each other.
Coordinate: Organize our individual work efforts
and use of resources.
Collaborate: Work together cooperatively on joint
projects and assignments.
ENTERPRISE COLLABORATION SYSTEMS (ECS)
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TOOLS FOR (ECS)
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Manufacturing Systems support the production
/operations function that includes all activities
concerned with the planning and control of the
processes producing goods or services. Thus, the
production/operations function is concerned with
the management of the operational processes and
systems of all business firms.
In these systems Computer Integrated Manufacturing
(CIM) techniques are used for :-
Simplification
Automation
Integration.
MANUFACTURING SYSTEMS
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CIM supports the
concepts of flexible
manufacturing systems,
agile manufacturing, and
total quality
management.
Implementing such
manufacturing concepts
enables a company to
respond to and fulfill
customer requirements
quickly with high-quality
products and services.
MANUFACTURING INFORMATION SYSTEMS
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A system of computers and/or controllers tools used
to schedule, dispatch and track the progress of work
orders through manufacturing based on defined
routings. SFCs typically calculate work in process
based on a percentage of completion for each order
and operation that are useful in inventory valuations
and materials planning.
SHOP FLOOR CONTROL (SFC)
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Faculty Name: Muhammad Aqeel
SUPPLY CHAIN
Supply Chain is a concept describing the flow of
materials, information, money and services from raw
material suppliers through factories and warehouses to
the end customers. It also includes the organizations
and processes that create and deliver these products,
information and services to end customers.
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Supply Chain Systems
Determine material requirements
Generate new orders
Send orders to suppliers
Obtain commitment dates
Verify that the orders actually arrived
Alter Information Systems 4th

ed.
2002 Prentice Hall
27
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Supply chain management (SCM)
System that allows close coordination with
suppliers
EDI and SCM are part of the general trend
toward integration between suppliers
and their customers
Alter Information Systems 4th

ed.
2002 Prentice Hall
28
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Material requirement planning (MRP)
Integrate purchasing & production activities
Calculate a schedule based on the output
requirement
Electronic data interchange (EDI)
The electronic transfer of business data
between the computerized information
systems of two firms
Alter Information Systems 4th

ed.
2002 Prentice Hall
29
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Faculty Name: Muhammad Aqeel
MATERIAL REQUISITION PLANNING (MRP)

The software that facilitates the plan for
acquiring or producing parts, sub-assemblies or
materials in the case of inter-dependence items is
called MRP. It follows a computer based approach
due to complex inter-relationship among many
products and their components and the need to
change the plan each time a delivery date or the
order quantity is changed.
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Faculty Name: Muhammad Aqeel
MANUFACTURING RESOURCE PLANNING (MRP II)

MRP II adds functionalities to a regular MRP. It
determines the cost of the parts assembled /
manufactured and the cash flow needed to pay for
the parts. It also estimates cost of labour, tools
equipment, repair and energy and finally provides a
detailed computerized benefit for the parts involved.
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Faculty Name: Muhammad Aqeel
JUST-IN-TIME (JIT)
Attempts to minimize wastage of all kinds e.g.
space, labour, material, energy, etc and to
continuously improve processing systems. Many JIT
systems are supported by software from different
vendors e.g. IBM, HP, etc.
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Faculty Name: Muhammad Aqeel
Computerized Integrated Manufacturing (CIM)
CIM is a concept that provides the integration of
various computerized factory systems. CIM is
expected to achieve the following three goals:
Simplification of all manufacturing technologies
and techniques.
Automation.
Interaction and coordination of design,
manufacturing and related functions via
computer hardware and software. Technologies
to be integrated are FMSs (Flexible
Manufacturing Systems), JIT, MRT, CAD, GT
(Group Technology).
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Marketing information systems use information technologies
to support major components of the marketing function.
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The Human Resource Management (HRM) function involves
the recruitment, placement, evaluation, compensation,
and development of the employees of an organization.
The goal of human resource management is the effective
and efficient use of the human resources of a company.
Human resource information systems (HRIS) are designed
to support
(1) planning to meet the personnel needs of the business,
(2) development of employees to their full potential, and
(3) control of all personnel policies and programs.
Originally, businesses used computer-based information
systems to
(1) produce paychecks and payroll reports,
(2) maintain personnel records, and
(3) analyze the use of personnel in business operations,
and security.
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Now a days many firms have gone beyond these
traditional personnel management functions and have
developed Human Resource Information Systems (HRIS)
that also support
(1) Recruitment, Selection, and Hiring;
(2) Job Placement (Transfer Posting);
(3) Performance Appraisals;
(4) Employee Benefits Analysis;
(5) Training and Development; and
(6) Health, Safety, and Security.
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A type of Management support system which
generates various reports extracted from the
database built by TPS. These reports facilitates the
managers in structured decisions.
Different types of Reports generated by MRS are:
Scheduled Reports
Exception Reports
Structured Reports
Ad hoc Reports

DIFFERNCE BETWEEN TPS AND MRS

MANAGEMENT REPORTING SYSTEM (MRS)
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Decision support systems use (1) analytical
models, (2) specialized databases, (3) a decision
makers own insights and judgments, and (4) an
interactive, computer-based modeling process to
support the making of semi-structured and
unstructured business decisions.
Normally these systems used by Middle level
Management. Major data processing operations
have to specify by end user (End user Computing).
Spread Sheet Packages are example of DSS.
DECISION SUPPORT SYSTEMS
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Activities and examples of the major types of
analytical modeling
Type of Analytical Modeling Activities and Examples
What-if analysis Observing how changes to selected variables affect
other variables.
Example: What if we cut advertising by 10 percent?
What would happen to sales?
Sensitivity analysis Observing how repeated changes to a single
variable affect other variables.
Example: Lets cut advertising by $100 repeatedly
so we can see its relationship to sales.
Goal-seeking analysis Making repeated changes to selected variables until
a chosen variable reaches a target value.
Example: Lets try increase in advertising until sales
reach $1million.
Optimization analysis Finding an optimum value for selected variables,
given certain constraints.
Example: Whats the best amount of advertising to
have, given our budget and choice of media?
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Executive Information systems (EIS) are information
systems that combine many of the features of
management information systems and decision support
systems. Primarily, their focus was on meeting the
strategic information needs of top management. Thus, the
first goal of executive information systems was to provide
top executives with immediate and easy access to
information about a firms critical success factors (CSFs).
These are also called Everyones Information Systems,
Enterprise Information Systems (EIS) and Executive
Support Systems (ESS). These names reflect the fact that
more features, such as Web browsing, electronic mail,
groupware tools, and DSS and expert system capabilities,
are being added to many systems to make them more
useful to managers and business professionals.
EXECUTIVE INFORMATION SYSTEMS
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Knowledge Management Systems (KMS) to manage
organizational learning and business know-how.
The goal of such systems is to help knowledge
workers create, organize, and make available
important business knowledge, wherever and
whenever its needed in an organization. This
includes processes, procedures, patents,
reference works, formulas, best practices,
forecasts, and fixes.
In many organizations, hypermedia databases at
corporate intranet websites have become the
knowledge base for storage and dissemination of
business knowledge.

KNOWLEDGE MANAGEMENT SYSTEMS
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Business
Business is an economic activity concerned
with production and distribution of goods
and/or services with the aim to earn profit. It
includes all those activities which are
directly /indirectly concerned with
production, purchase and sale of goods and
services. So the production, marketing,
advertising, warehousing, insurance,
banking, etc. are all business activities.
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EDI ELECTRONIC DATA INTERCHANGE
Electronic data interchange (EDI) was one of the earliest
uses of information technology for supply chain
management. EDI involves the electronic exchange of
business transaction documents over the Internet and
other networks between supply chain trading partners
(organizations and their customers and suppliers). Data
representing a variety of business transaction documents
(such as purchase orders, invoices, requests for
quotations, and shipping notices) are automatically
exchanged between computers using standard document
message formats. Typically, EDI software is used to
convert a companys own document formats into
standardized EDI formats as specified by various industry
and international protocols. Thus, EDI is an example of
the almost complete automation of an e-commerce supply
chain process. EDI over the Internet, using secure virtual
private networks , is a growing B2B e-commerce
application.
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E-commerce
The process of buying, selling and marketing
the Products / Services using internet
Technologies. Any internet visitor can access
information about a product, place an order,
make electronic payments to commit the
order, and in some cases can receive
products or services using computers.
E-commerce is the part of e-business that
the customer experiences directly

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E-commerce Categories
Business to Business (B2B)
Sales of goods and services among business
Business to Customer (B2C)
Retailing products and services
Customer to Customer (C2C)
Individuals use web for sale and service
Government to Customer (G2C)
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E-Commerce Architecture
Most of the information technologies and Internet
technologies are involved in e-commerce systems as
clear from the following figure , which gives an example
of the technology resources required by many e-
commerce systems. The figure illustrates some of the
hardware, software, data, and network components
used by a compny to provide business-to-business
(B2B) online auction e-commerce services.
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Advantages of E-Commerce
The advantages of e-commerce allow a business of
virtually any size that is located virtually anywhere on the
planet to conduct business with just about anyone,
anywhere.
The power of e-commerce allows geophysical barriers to
disappear, making all consumers and businesses on
earth potential customers and suppliers.
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Advantages of E-Commerce
The advantages of e-commerce allow a business
of virtually any size that is located virtually
anywhere on the planet to conduct business with
just about anyone, anywhere.
Imagine a small olive oil manufacturer in a remote
village in Italy selling its wares to major
department stores and specialty food shops in
large metropolitan markets of various parts of the
world . The power of e-commerce allows
geophysical barriers to disappear, making all
consumers and businesses on earth potential
customers and suppliers.
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Advantages of E-Commerce
Barrier to Entry are Low
Global Presence / Global Choice
Improved Competitiveness / Quality of
Service
Mass Customization / Personalized
Products and Services
Substantial Cost Savings / Substantial
Price Reductions
Novel Business Opportunities / New
Products and Service
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Confidentiality
Integrity
Availability
Authentication & Nonrepudiation
E-Commerce Risks
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Confidentiality
Potential consumers are concerned about providing
unknown vendors with personal, sometimes sensitive
information. Connecting to the internet via a
browser requires running software on the computer
that has been developed by some one unknown to
the organization.

Integrity
Data, both in transit and storage, could be
susceptible to unauthorized alteration or deletion
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Availability
The internet holds out the promise of doing business
on a 24-hour, seven days-a-week basis. Hence, high
availability is important with any systems failure
becoming immediately apparent to customers or
business pattern.
Authentication & Nonrepudiation
The parties to an electronic transaction should be in
a known and trusted business relationship, which
requires that they prove their respective identities
before executing the transaction. Then, after the
fact, there must be some manner of ensuring that
the transacting parties cannot deny that the
transaction was entered into and terms on which it
was completed.
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Sabotage or Defacement:
Unauthorized access:
Degradation of performance:
E-Commerce Risk
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Sabotage or Defacement:
All the business transactions and deals
going on through online methods, you
being a businessman can also face the
problem of attacks. There are different
malicious attacks like virus, worms and
Trojan horse, that your system can be a
pray to. You should always have a good
anti-virus and keep it updated to impede
any such kinds of attacks.
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Unauthorized access: While you may not be
aware of and trust your employees the best,
you might never know who accesses your data
and account illegally. Unauthorized access to
your data can also be done by outsiders. Poor
configuration of systems and poor encrypted
transmission are few factors that can let
others access your confidential business data
illegally. You must also be careful to choose
strong passwords, and avoid hint questions
like maiden name of your mother or school
you went to. In most cases you can form your
own question. Do that wherever applicable;
and if not try choosing your hint questions in a
way that will not let anyone guess it or know
it. .
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CRM uses information technology to create a
cross-functional enterprise system that
integrates and automates many of the
customer-serving processes in sales,
marketing, and customer services that
interact with a companys customers.
CRM systems include a family of software
modules that provides the tools that enable
a business and its employees to deliver fast,
convenient, dependable, and consistent
service to its customers.
CRM
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CRM
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Acquire. CRM software help to acquire new
customers by doing a superior job of contact
management, sales prospecting, selling, direct
marketing, and fulfillment. The goal of these
CRM functions is to help customers to
perceive the value of a superior product
offered by an outstanding company.
THREE PHASES - CRM
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Enhance . Web-enabled CRM account
management and customer service and
support tools help to keep customers happy by
supporting superior service from a
responsive networked team of sales and
service specialists and business partners. In
addition, CRM sales force automation and
direct marketing and fulfillment tools also
help companies in cross-selling and up-selling
to their customers, thus increasing their
profitability to the business. The value the
customers perceive is the convenience of one-
stop shopping at attractive prices.
THREE PHASES - CRM
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Retain . CRM analytical software and
databases help a company proactively
identify and reward its most loyal and
profitable customers to retain and expand
their business via targeted marketing and
relationship marketing programs. The value
the customers perceive is of a rewarding
personalized business relationship with
their company.
THREE PHASES - CRM
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BENEFITS - CRM
CRM allows a business to identify and target its best
customersthose who are the most profitable to the
business so they can be retained as lifelong customers for
greater and more profitable services.
It makes possible real-time customization and
personalization of products and services based on
customer wants, needs, buying habits, and life cycles.
CRM can also keep track of when a customer contacts
the company, regardless of the contact point.
In addition, CRM systems can enable a company to
provide a consistent customer experience and superior
service and support across all the contact points a
customer chooses.
All of these benefits would provide strategic business value
to a company and major customer value to its customers.
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CRM - FAILURE
The common wisdom of why CRM systems fail includes:
Lack of senior management sponsorship
Improper change management
Elongated projects that take on too much, too fast
Lack of or poor integration between CRM and core
business systems
Lack of end-user incentives leading to poor user
adoption rates
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A successful SCM strategy is based on accurate order
processing, just-in-time inventory management, and timely
order fulfillment.

supply chain management helps a company get the right
products to the right place at the right time, in the proper
quantity and at an acceptable cost. The goal of SCM is to
manage this process efficiently by forecasting demand;
controlling inventory; enhancing the network of business
relationships a company has with customers, suppliers,
distributors, and others; and receiving feedback on the
status of every link in the supply chain.
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To achieve this goal, many companies today are
turning to Internet technologies to Web-enable their
supply chain processes, decision making, and
information flows.

Supply Chain Management is a cross-functional inter-
enterprise system that uses information technology
to help support and manage the links between some
of a companys key business processes and those of
its suppliers, customers, and business partners. The
goal of SCM is to create a fast, efficient, and low-cost
network of business relationships, or supply chain ,
to get a companys products from concept to market.

Supply chain management software and Internet
technologies can help companies reengineer and
integrate the functional SCM processes that support
the supply chain life cycle.
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ERP ENTERPRISE RESOURCE PLANNING
ERP serves as a cross-functional enterprise backbone
that integrates and automates many internal business
processes and information systems within the
manufacturing, logistics, distribution, accounting,
finance, and human resource functions of a company.
Enterprise resource planning is a cross-functional
enterprise system driven by an integrated suite of
software modules that supports the basic internal
business processes of a company.

ERP gives a company an integrated real-time view of
its core business processes, such as production,
order processing, and inventory management, tied
together by the ERP application software and a
common database maintained by a database
management system.
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The major application components of enterprise resource
planning demonstrate the cross functional approach of ERP
systems.
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The business processes and functions supported by the ERP
system implemented by the Colgate- Palmolive Company.
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ERP BENEFITS
Quality and efficiency .
ERP creates a framework for integrating and
improving a companys internal business processes
that results in significant improvements in the
quality and efficiency of customer service,
production, and distribution.
Decreased costs .
Many companies report significant reductions in
transaction processing costs and hardware, software,
and IT support staff compared to the nonintegrated
legacy systems that were replaced by their new ERP
systems.
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ERP BENEFITS
Decision support .
ERP provides vital cross-functional information on
business performance to managers quickly which
significantly improve their ability to make better
decisions in a timely manner across the entire
business enterprise.
Enterprise agility .
Implementing ERP systems breaks down many former
departmental and functional walls of business
processes, information systems, and information
resources which results in more flexible
organizational structures, managerial
responsibilities, and work roles, and therefore a
more agile and adaptive organization and workforce
that can more easily capitalize on new business
opportunities.
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Typical costs of implementing a new ERP system.