d McLeod and George Schell Learning Objectives ► Know that a firm’s ability to develop effective information systems can be a key factor in its success. ► Recognize that the transaction processing system processes describes the firm’s basic daily operations. ► Be familiar with the processes performed by a transaction processing system for a distribution firm. ► Recognize that organizational information systems have been developed for business areas and organizational levels. ► Be familiar with architectures of marketing, human resources, manufacturing, and financial information systems.
all ystems, 10/e Raymond Mc Learning Objectives (Cont’d) ► Know the architecture of an executive information system. ► Understand what customer relationship management is and why it requires a large computer storage capability. ► Recognize how a data warehouse differs from a database. ► Understand the architecture of a data warehouse system. ► Know how data are stored in a data warehouse data repository. ► Know how a user navigates through the data repository. ► Know what on-line analytical processing (OLAP) is. ► Know the two basic ways to engage in data mining.
all ystems, 10/e Raymond Mc Information as a Critical Success Factor ► Critical success factor (CSF) was coined by Ronald Daniel to identify a few key activities that spell success or failure for any type of organization. ► Transaction processing system (TPS) is the information system that gathers data describing the firm’s activities, transforms the data into information, and makes the information available to users both inside and outside the firm. 1st business application to be installed on computers. ► Alsoelectronic data processing (EDP) system and accounting information system.
all ystems, 10/e Raymond Mc Major Subsystems of Distribution System ► Systems that fill customer orders. Order entry system enters customer orders into the system. Inventory system maintains the inventory records. Billing system prepares the customer invoices. Accounts receivable system collects the money from the customers. ► Systems that order replenishment stock. Purchasing system issues purchase orders to suppliers for needed stock. Receiving system receives the stock. Accounts payable system makes payments.
all ystems, 10/e Raymond Mc Major Subsystems of Distribution System (Cont’d) ► Systems that perform general ledger processes. General ledger system is the accounting system that combines data from other accounting systems for the purpose of presenting a composite financial picture of the firm’s operations. General ledger is the file that contains the combined accounting data. Updated general ledger system posts records that describe various actions and transactions to the general ledger. Prepare management reports system uses the contents of the general ledger to prepare the balance sheet, income statement, and other reports.
all ystems, 10/e Raymond Mc Organizational Information Systems ► Organizational information systems are developed to meet the needs for information relating to those particular parts of the organization. ► Marketing information system (MKIS) provides information that relates to the firm’s marketing activities. Consists of a combination of input and output subsystems connected by a database.
all ystems, 10/e Raymond Mc Marketing Information System ► Output subsystems provide information about critical elements in marketing mix. ► Marketing mix consists of four main ingredients that management manages in order to meet customers’ needs at a profit. Product subsystem provides information about the firm’s products. Place subsystem provides information about the firm’s distribution network. Promotion subsystem provides information about the firm’s advertising and personal selling activities. Price subsystem helps the manager make pricing decisions. Integrated-mix subsystem enables the manager to develop strategies that consider the combined effects of the ingredients.
all ystems, 10/e Raymond Mc The Executive Information System ► Executive information system (EIS) is a system that provides information to upper-level managers on the overall performance of the firm; also called Executive support system (ESS). ► Drill-down capability allows for executives to bring up a summary display and then successively display lower levels of detail until executives are satisfied that they have obtained as much detail as is necessary.
all ystems, 10/e Raymond Mc Customer Relationship Management ► Customer relationship management (CRM) is the management of the relationships between the firm and its customers so that both the firm and its customers receive maximum value from the relationship. ► CRM system accumulates customer data over a long term–5 years, 10 years, or more-and uses that data to produce information for users. Uses a data warehouse.
all ystems, 10/e Raymond Mc Storing Data in the Warehouse Data Repository ► Dimension tables store the identifying and descriptive data. Dimension provides the basis for viewing the data from various perspectives or dimensions. ► Fact tables are separate tables containing the quantitative measures of an entity. Combined with dimension table data, various analyses can be prepared. Users can request information that involves any combination of the dimensions and facts.
all ystems, 10/e Raymond Mc Storing Data … (Cont’d) ► Information package identifies all of the dimensions that will be used in analyzing a particular activity. ► Star schema-for each dimension, a key identifies the dimension and provides the link to the information package that results in a structure that is similar to the pattern of a star. The warehouse data repository contains multiple star schemas, one for each type of activity to be analyzed.
all ystems, 10/e Raymond Mc Information Delivery ► Drill down-the process of navigating down through the levels of detail. ► Roll up-enables the user to begin with a detail display and then summarizes the details into increasingly higher summary levels. ► Drill across-moving from one data hierarchy to another. ► Drill through-going from a summary level to the lowest level of detail.
all ystems, 10/e Raymond Mc OLAP ► On-line analytical processing (OLAP) enables the user to communicate with the data warehouse either through a GUI or a Web interface and quickly produce information in a variety of forms, including graphics. ► Relational OLAP (ROLAP) uses a standard relational database management system. ROLAP data exists in detailed form. Analyses must be performed to produce summaries. Constrained to a limited number of dimensions. ► Multidimensional OLAP (MOLAP) uses a special multidimensional database management system. MOLAP data are preprocessed to produce summaries at the various levels of detail and arranged by the various dimensions. Faster summary ability, can use many dimensions–10 or more.