Cost Leadership and Information Systems Overview

Cost Leadership

Requires a set of interrelated tactics, including:

• Aggressive construction of efficient-scale facilities
• Pursuit of cost reductions from experience
• Tight cost and overhead control
• Avoidance of marginal customer accounts
• Cost minimization in all activities in the value chain, such as R&D, service, sales force, and advertising
• Parity in differentiation with competitors

PITFALLS: lack of parity in differentiation, reduced flexibility, obsolescence

PRIMARY: EFFECTIVE

SECONDARY: todo lo que reduzca coste.

Transaction Processing Systems (TPS)

• Basic business systems that serve the organization's operational level
• Input: transactions (invoice, order, payroll), events
• Processing: Sorting, listing, merging, updating
• Output: detailed reports, lists, summaries
• Users: operations personnel, supervisors

Transactional, operational, do it every day/week/month, no strategy needed to do so

Management Information Systems (MIS)

• Serve management level, provide reports and access to company data
• Input: summary transaction data, high-volume data, simple models
• Processing: routine reports, simple models, low-level analysis
• Output: summary and exception reports
• Users: middle managers

Decision-support Systems (DSS)

• Serve management level with data analysis for making decisions
• Input: low-volume data or massive databases, analytic models and data analysis tools
• Processing: interactive, simulations, analysis
• Output: special reports, decision analyses, responses to queries
• Users: professionals, staff managers

Executive Support Systems (ESS)

• Provide communications and computing environment that serves the organization's strategic level
• Input: external and internal aggregate data
• Processing: graphics, simulations, interactive
• Output: projections

Sales and Marketing Systems

• Help identify customers
• Develop products and services
• Promote products and services
• Sell products and services
• Provide ongoing customer support
• e.g.: Order processing: operational, Pricing analysis: Management, Sales trend forecasting: Strategic