Relationship of business process and information system

relationship of business process and information system

But what is a process and how does it tie into information systems? And in what ways do processes have a role in business? This chapter will look to answer. Improving Business Processes with Information Systems. What Is a Business Processes are also the flow of information – sets of activities through the organization. Examples Supply Chain Management; Customer Relations Management. Describe the information systems supporting the major business functions: sales and between organizations, information systems, and business processes. Supply chain management systems help the firm manage its relationship with.

What data characteristics are necessary for quality information?

Learning Objectives

Can tasks be re-ordered or re-organized to eliminate tasks and save labor hours? Can process costs be reduced by applying information technology? How to place an order offline and online? Out-of-date interview processes time-consuming and costly — Web-enabled video interview process current trend.

More virtual audio visual meetings and fewer in-person meetings. Needs to understand its existing processes and to identify the problems they have. Needs to redesign its current processes. Needs to know where and how to save costs.

Procurement and sales process will show how an information system can help to record problems and better negotiate with, or avoid, its problematic vendors. What Is a Business Process? After-sale customer service — meeting customers face-to-face to answer questions and complete return and refund, a room in a building, electricity, air conditioner, equipment, people, information sources product, customer, payment, etc.

As shown, vendors agree to sell a certain quantity of items to GearUp at very low prices.

relationship of business process and information system

Typically these items are discontinued, or out of season, or out of style, or for which the vendor has a need to reduce its inventory Vendor agrees to sell certain quantity of items to GearUp at very low prices. After action closes, GearUp orders total number of items sold. GearUp receives items in bulk from vendor, repackages them, and ships to customers. This requirement can be built into the system so that the return will not be processed unless a valid ID number is entered.

By creating a process and enforcing it with information technology, it is possible to create a consistency across the entire organization. In our example, all stores in the retail chain can enforce the same returns policy.

Business Processes, Information, and Information Systems

And if the returns policy changes, the change can be instantly enforced across the entire chain. Business Process Reengineering As organizations look to manage their processes to gain a competitive advantage, they also need to understand that their existing ways of doing things may not be the most effective or efficient.

A process developed in the s is not going to be better just because it is now supported by technology. He states in the introduction to the article: They are geared towards greater efficiency and control.

Yet the watchwords of the new decade are innovation and speed, service, and quality. It is time to stop paving the cow paths. Instead of embedding outdated processes in silicon and software, we should obliterate them and start over.

Business process reengineering is not just taking an existing process and automating it. BPR is fully understanding the goals of a process and then dramatically redesigning it from the ground up to achieve dramatic improvements in productivity and quality.

But this is easier said than done. Most of us think in terms of how to do small, local improvements to a process; complete redesign requires thinking on a larger scale.

relationship of business process and information system

Hammer provides some guidelines for how to go about doing business process reengineering: Organize around outcomes, not tasks. This simply means to design the process so that, if possible, one person performs all the steps. Instead of repeating one step in the process over and over, the person stays involved in the process from start to finish.

Have those who use the outcomes of the process perform the process.

relationship of business process and information system

Using information technology, many simple tasks are now automated, so we can empower the person who needs the outcome of the process to perform it. The example Hammer gives here is purchasing: Subsume information-processing work into the real work that produces the information.

When one part of the company creates information like sales information, or payment informationit should be processed by that same department.

There is no need for one part of the company to process information created in another part of the company. Treat geographically dispersed resources as though they were centralized.

With the communications technologies in place today, it becomes easier than ever to not worry about physical location. A multinational organization does not need separate support departments such as IT, purchasing, etc.

Link parallel activities instead of integrating their results. Departments that work in parallel should be sharing data and communicating with each other during their activities instead of waiting until each group is done and then comparing notes. Put the decision points where the work is performed, and build controls into the process.

Chapter 8: Business Processes – Information Systems for Business and Beyond

The people who do the work should have decision-making authority and the process itself should have built-in controls using information technology. Capture information once, at the source. Requiring information to be entered more than once causes delays and errors. With information technology, an organization can capture it once and then make it available whenever needed.

These principles may seem like common sense today, but in they took the business world by storm. Hammer gives example after example of how organizations improved their business processes by many orders of magnitude without adding any new employees, simply by changing how they did things see sidebar.

Unfortunately, business process reengineering got a bad name in many organizations.

Business Processes, Functions and ERP

This was because it was used as an excuse for cost cutting that really had nothing to do with BPR. For example, many companies simply used it as an excuse for laying off part of their workforce. Today, however, many of the principles of BPR have been integrated into businesses and are considered part of good business-process management.

Reengineering the College Bookstore The process of purchasing the correct textbooks in a timely manner for college classes has always been problematic. But college bookstores have one big advantage over their competitors: In other words, once a student has registered for classes, the bookstore knows exactly what books that student will need for the upcoming term. To leverage this advantage and take advantage of new technologies, the bookstore wants to implement a new process that will make purchasing books through the bookstore advantageous to students.

Though they may not be able to compete on price, they can provide other advantages, such as reducing the time it takes to find the books and the ability to guarantee that the book is the correct one for the class.

Business Processes, Information, and Information Systems - ppt video online download

In order to do this, the bookstore will need to undertake a process redesign. The goal of the process redesign is simple: After diagramming the existing process and meeting with student focus groups, the bookstore comes up with a new process.

In the new process, the bookstore utilizes information technology to reduce the amount of work the students need to do in order to get their books. In this new process, the bookstore sends the students an e-mail with a list of all the books required for their upcoming classes.

By clicking a link in this e-mail, the students can log into the bookstore, confirm their books, and purchase the books. The bookstore will then deliver the books to the students. College bookstore process redesign click to enlarge ISO Certification Many organizations now claim that they are using best practices when it comes to business processes. In order to set themselves apart and prove to their customers and potential customers that they are indeed doing this, these organizations are seeking out an ISO certification.

relationship of business process and information system

This body defines quality standards that organizations can implement to show that they are, indeed, managing business processes in an effective way. The ISO certification is focused on quality management. In order to receive ISO certification, an organization must be audited and found to meet specific criteria. In its most simple form, the auditors perform the following review: Analyze the relationship between organizations, information systems, and business processes.

Business processes refer to the manner in which work activities are organized, coordinated, and focused to produce a specific business result. They also represent unique ways in which organizations coordinate work, information, and knowledge and the ways in which management chooses to coordinate work.

Managers need to pay attention to business processes because they determine how well the organization can execute, and thus are a potential source of strategic success or failure.

Although each of the major business functions has its own set of business processes, many other business processes are cross-functional, such as order fulfillment. Information systems can help organizations achieve great efficiencies by automating parts of these processes or by helping organizations rethink and streamline them. Firms can become more flexible and efficient by coordinating and integrating their business processes to improve management of resources and customer service.

Explain how enterprise applications promote business process integration and improve organizational performance. Enterprise applications, such as enterprise systems, supply chain management systems, customer relationship management systems, and knowledge management systems, are designed to support organization-wide process coordination and integration so that the organization can operate more efficiently.