Information Systems and Business Process Integration

Functional and User Perspectives of Information Systems

Information Systems (IS) are classified from a functional perspective in the following ways:

• Sales and Marketing Systems
• Manufacturing and Production Systems
• Financial and Accounting Systems
• Human Resources (HR) Systems

From a user perspective, they are classified as follows:

1. Transaction Processing Systems (TPS): These provide support for operations-level employees.
2. Management Information Systems (MIS) and Decision Support Systems (DSS): These support managers.
3. Executive Support Systems (ESS): These support senior executives.

Characteristics of Transaction Processing Systems

The characteristics of Transaction Processing Systems (TPS) include:

• They are computer systems that run and record the daily routine transactions necessary to conduct business.
• Examples: Sales order entry, payroll, and delivery notes.
• They serve the operational levels of an organization.
• They allow managers to monitor internal operations and business relationships with the external environment.
• They produce information that serves as data for other types of systems.
• If they fail, it can lead to a total business collapse (e.g., UPS or major airlines).

Comparing MIS, DSS, and ESS

Management Information Systems (MIS)

MIS summarize and report on basic operations using the data provided by Transaction Processing Systems. These are presented in reports that are produced regularly. They use simple routines, such as summaries and comparisons, rather than complex mathematical models.

Decision Support Systems (DSS)

DSS serve middle management by supporting non-routine decision-making. They are designed to be used directly by the decision-maker (the user). They often gather information from external sources as well as from the TPS and MIS.

Executive Support Systems (ESS)

ESS help senior management address strategic issues and long-term trends. They assist in non-routine decisions requiring judgment, evaluation, and insight. They incorporate external data (e.g., new tax laws or competitor activities) as well as summary information extracted from internal MIS and DSS. Data is presented via graphs and multiple sources through an easy-to-use interface.

System Relationships

In terms of relationships, ESS are the recipients of data from lower-level systems, specifically the MIS and DSS.

Business Process Integration and Key Applications

Companies are involved in integrating their business processes because these systems cover all functional areas to implement processes across the entire enterprise, including all levels of management. Business applications help companies become more flexible and productive through closer coordination and the integration of process groups.

The four most important business applications are:

1. Enterprise Systems (ERP)
2. Supply Chain Management Systems (SCM)
3. Customer Relationship Management Systems (CRM)
4. Knowledge Management Systems (KMS)