12: The Finance Function and IT Flashcards
(40 cards)
uses of information systems
- supports operations to process/store all transactions
- supports managerial activities to make decisions, plan and measure performance
data, information and knowledge
data as raw facts and figures
information as processed, organised data with some value
knowledge as an application of a cognitive process such that it becomes useful (something you know and understand)
2 broad categories of knowledge
- tacit knowledge - you may be unaware of this knowledge that you can’t access/use
- explicit knowledge
2 categories of IT systems enabling knowledge management
- systems that create information and knowledge
- systems that share information and knowledge between business functions
transaction processing systems (TPS)
perform and record routine transactions
useful at the lowest level of the organisation
knowledge work systems (KWS)
sit one level above TPS
facilitate the creation and integration of new knowledge into an organisation
- turning tacit into explicit knowledge
knowledge workers - used to be referred to as professions but now a broader category
computer-aided design (CAD), computer-aided manufacturing (CAM) and specialised financial software analysing trading situations
office automation systems (OAS)
systems designed to increase productivity of data and information workers
supports major activities performed in a typical office such as facilitating communication and managing data
management information systems (MIS)
convert data from mainly internal sources into information (summary reports, exception reports)
information enables managers to make timely/effective decisions for planning, directing and controlling activities
MIS transforms data from TPS
decision support systems (DSS)
combine data and analytical models or data analysis tools to support semi-structured or unstructured decision-making
with semi-structured or unstructured decision-making, you need human interference and high-level human logic
executive information systems (EIS)
pool data from internal and external sources and make information available to senior managers in an easy to use form
helps senior managers make strategic unstructured decisions
tend to be data visualisation / dashboard applications
also called executive support systems (ESS)
- have to be flexible, quick response time and capable of analysing and modelling data
expert systems
form of decision support system allowing users to benefit from expert knowledge and information
consist of a database holding specialised data and rules about what to do or how to to interpret a given set of circumstances
diagnostic decisions can be made by expert systems - go through, assist and make structured decisions
enterprise-wide systems
designed to coordinate all business functions, resources and information wherever they are geographically
one database sharing information across the whole business to coordinate purchasing, sales, manufacturing, HR, finances, etc.
knowledge management systems (KMS)
record and store knowledge held within an organisation
information should be easily accessible and shared by employees
customer relationship management systems (CRMs)
software applications specialising in providing information concerning an organisation’s products/services and customers
how can IT work in the context of change management?
type of products/services made and sold can change
way in which products are made
way in which employees are mobilised
way in which services are provided
enables change
aiding communication and coordination
source of unity/structure
erosion of bargaining power of suppliers (Porter)
increase competition between different suppliers
suppliers’ powers can be shared
totally integrate suppliers using electronic data interchange systems
virtual companies
collection of separate companies, each with specific expertise, which work together and share expertise to compete for bigger contracts/projects than would be possible if they worked alone
virtual supply chains
supply chains enabled through e-business links (web and extranet)
2 types of organisations in the virtual supply chain
- producers
- integrators - manage the supply network and effectively own the end customer contract
ethical considerations of information systems
information rights and obligations
property rights
accountability and control
systems quality
quality of life
costs vs benefits of information systems
costs tend to be tangible whereas benefits are intangible and hard to quantify
costing includes development, implementation and running costs
direct / big bang changeover
quickest and most direct
no parallel running, immediate switch
quick and cheap but risky
parallel running
maximum comfort but also maximum cost
two systems, time-consuming and additional workload
pilot operation
selecting one or several parts of the organisation where you use the new system
mix of direct changeover in one part but also running other systems in parallel
less risky and costly
