Chapter 2

imissyou419's version from 2017-04-20 02:36


Question Answer
Business processA series of activities, task, or steps designed to produce a product or service;
also referred to as a business system
a network of activities, resources, facilities, and information that interact to achieve some business function
Examples of business processesInventory management processes, manufacturing processes, sales processes, customer support processes
InventoryGoods that a business sells; this is a business process; the goal: ensure that there is enough inventory to fulfill customer's requests while making sure there isn't too much inventory
Inventory management processworks to balance the demands of customers with the inventory purchased from suppliers
Inventory management systemsupports the inventory management process by collecting information
Inventory databasekeeps track of what customers have ordered (quantity on hand) and what is in inventory (quantity on hand)
Reorder pointas customers make purchases, stock moves out of inventory which hits a critical point
Steps to reorder inventorymanager creates a purchase order (PO), which lists the items ordered and quantity desired. Then sent to supplier who ships the appropriate goods with the shipping invoice to the business. The shipped goods are checked to make sure the business received what was ordered and are then placed in inventory and inventory database is updated with quantity received. Supplier is then paid for the supplies shipped.
Dataflow diagram (DFD)common way that business processes are illustrated
A business process consists ofactivities, resources, facilitaties, information
business process -activitiespurely manual actions (people following procedures), automated or controlled procedures used by computers (hardware directed by software), a combination of manual and automated procedures
Transform resources and information of 1 type into another
business process -resourcesitem of value; supply, workers, customer's cash; suppliers and customers are considered resources b/c they have value in this process (not considered activities because they are external and not under the business' direction and control)
business process -facilitiesSTRUCTURES used within the business process, resources can be stored within facilities e.g. factories, pieces of equipment, trucks, filing cabinets, inventories and databases
business process -informationactivities use information to determine how to transform the inputs received into output produced
The Object Management Group (OMG)a software industry standards organization, created a standard set of terms and graphic notation for documenting business processes (Business Process Modelling Nation (BPMN) - provides 4 graphical elements that can be used to document a process)
Definition of information1. knowledge derived from data (data is defined as recorded facts or figures), 2. data presented in a meaningful context, 3. processed data, 4. a difference that makes a difference
Characteristics of good information1. Accurate based on correct and complete data that has been processed correctly and as expected (cross-checking the info),
2. Timely produced for its intended use,
3. Relevant for both the context and the subject,
4. Just barely sufficient for the purpose for which it is generated,
4. Worth its cost in terms of relationship between cost of information and its value
Business Process Management (BPM)a field of management that promotes the development of effective and efficient processes through continuous improvement and innovation; innovation are developed by integrating information technology into a business process; methods that organizations developed to support their improvement: total quality management (TQM), six sigma, lean production
Actorshardware, people; they take action
Instructionssoftware, procedures; sets of instructions
Bridgedata; forms bridge between computer side and human side
Automated systemwork formerly done by people who follow procedures has been changed so that computers now do that work by following instructions in software; consists of moving work from human side to computer side
An information system to support counter salesmostly an automated system, almost all work is done by computer and software; cashiers operate cash register connected to sales-recording program
An information system to support paymentmostly a manual system, little work is done by computers and software, most work is done by account payable clerk; issue payment authorization and process exceptions
An information system to support purchasingbalance between computer and human work; purchasing clerk decides suppliers to order from
Purchasing clerk's computer runs a program that queries databases & identifies stock levels to generate a PurchaseOrder
- search database is repetitive (automated)
- searching suppliers is complicated (manual)
Operational decisionsconcern day to day activities of an organization, includes: which invoice to pay today
Transaction Processing System (TPS)an information system that supports operational decision making
- collect, store, modify & retrieve transactions
Managerial decisionsconcerns the allocation and utilization of resources, includes: how much to budget for computer hardware and programs for department A next year (how much?)
Management Information System (MIS)information system that supports managerial decision making
Strategic decisionsconcern broader organization issues, includes: starting new product lines (should we..?)
Supported by Executive Information Systems (EIS)
- easy access to information
- support decision making process
- provides access to internal & external info
Structured decisionsthere is an understood and accepted method for making the decision, include: formula for computing reordering quantity of an item in inventory, allocating furniture and equipment to employees, weather forecasting
Unstructured decisionsthere is no agreed-upon decision-making method, includes: predicting the future direction of the economy or stock, assessing how well suited an employee is for performing a particular job
What structure are operational decisions?structured
What structure are managerial decisions?structured and unstructured
What structure are strategic decisions?unstructured
Intelligence gatheringdecision makers determine what is to be decided, what criteria for the decision will be, what data are available, obtain relevant data
Examples of possible information systems: communication applications, query and reporting systems, data analysis applications
Alternative formulationdecision makers lay out various alternatives
Examples of possible information systems: communication applications
Choiceanalyze alternatives against criteria using data and select one
Examples of possible information system: spreadsheets, financial modelling, other modelling
Implementationimplement decision
Examples of possible information systems: communication applications
Revieworganization review results of decision, may lead to another decision
Examples of possible information systems: communication applications, query and reporting systems, spreadsheet and other analysis
Data vs Informationdata - hourly wage, information - average wage; data - facts or figures (collected, recorded, stored, processed), not meaningful on its own
Quantity received - data
Shipping invoice - data
Quantity received & shipping invoice - information (meaningful context)
Business processes GENERATE information - bringing important items of data together
IS provide information (raw material) to make decisions

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