1.6 Computer Based Information Systems


Because there are different levels in the organization, no single system can provide all the information needs for
managers at different levels. Information systems can be classified depending on the system's complexity and
the type of functions it serves.

Transaction Processing System
Transaction processing system (TPS) is computerized systems that keep track of the daily routines transactions
necessary to conduct business. The main purpose of TPS is to answer routine questions. Transactions are
events and operations that occur as a part of doing business like for example, products selling and purchasing,
employee record keeping, withdrawal, deposit.
The transaction processing cycle include:
Data Entry: data is collected and entered to the system
Data Processing: processing is done in two ways: batch and real-time or online processing
Database Update: example of database update is changing the level of inventory when products are
delivered to customers.
Document and Report Generation: Examples of transaction documents include purchase orders,
paychecks, sales receipts, invoices, and customer statements

1.6 Computer Based Information Systems


Inquiry Processing: For example, you might check on the status of a sales order, the balance in an
account, or the amount of stock in inventory and receive immediate responses at your PC.

Management Information System
MIS is the study of information systems in business and management. It serves middle managers in the
organization and provides them reports about the performance of the organization which helps in controlling the
business and predicts future performance. MIS tend to answer questions like does the organization perform
well?
Management information system provides information to middle managers by summarizing and reporting data
supplied by the organizational TPS. Most of these systems use simple processing such as summaries and
comparisons as opposed to sophisticated systems. For example MIS reports may present total annual sales and
compare it to specific target or compare it with sales in previous years.


1.6 Computer Based Information Systems


Decision Support Systems
Decision support systems (DSS) are computer based information systems that provide interactive information
support to managers and business professionals during the decision making process. DSS support non routine
decision making. DSSs are primarily designed for unique and rapidly changing problems for which steps for
arriving to a solution may not be predefined or clear.
DSS helps find the optimal course of actions, decisions and answer "what if" questions". What if we merge
with XYZ Inc.? What if we double our shifts and cut our staff?
There are three phases for decision making: Intelligence, design, choice.
Environment in which decisions are made are not sufficiently structured to let information system use data to
provide the one best answer. We have three types of problems: structured, semi-structured and unstructured

Enterprise Resource Planning (ERP)
Firms use ERP to integrate business processes in manufacturing and production, finance and accounting, sales
and marketing, and human resources into a single software system.
Information that was previously fragmented between different systems is now available in one data repository
governed by one system.

1.6 Computer Based Information Systems


For example, when a customer places an order, the order data flow automatically to other parts of the company
that are affected by them. The order transaction triggers the warehouse to pick the ordered products and
schedule shipment.
The warehouse informs the factory to replenish whatever has been depleted. The accounting department is
notified to send the customer an invoice.
Customer service representatives track the progress of the order through every step to inform customers about
the status of their orders.
Benefits of ERP:
Decision support: ERP provide managers with information required for decision making form different
organization departments.
Decreased cost: The use of ERP systems result in a significant reduction in transaction processing cost
and hardware, software and IT supports staff.
Enterprise agility: ERP gives flexibility to organization through breaking down many departmental and
functional walls of business processes.

1.6 Computer Based Information Systems


Quality and efficiency: ERP increase the quality and efficiency of customer service and production process
and distribution because it integrates data scattered through different organization divisions.
Although the benefits of ERP are many, the costs and risks are also considerable. The costs and risks of failure
in implementing a new ERP system are substantial.
Most companies have had successful ERP implementations, but a sizable minority of firms experienced
spectacular and costly failures that heavily damaged their overall business.
Big losses in revenue, profits, and market share resulted when core business processes and information
systems failed or did not work properly. In many cases, orders and shipments were lost, inventory changes were
not recorded correctly, and unreliable inventory levels caused major stock-outs to occur for weeks or months.

E-commerce
E-commerce is the process of buying and selling of goods and services over the Internet. It also encompasses
activities supporting those market transactions, such as advertising, marketing, customer support, security,
delivery, and payment.

1.6 Computer Based Information Systems


Digital goods are goods that can be delivered over a digital network. Music tracks, video, movies, software,
newspapers, magazines, and books can all be expressed, stored, delivered, and sold as purely digital products.
There are several characteristics for e-commerce making it grown rapidly:
Ubiquity: e-commerce is available everywhere at anytime. Shopping is available 24/7.
Global reach: the electronic market now includes billions of consumers and millions of businesses
worldwide.
Interactivity: the interactivity replaces the face to face communications in the physical markets.
Personalization/Customization: e-commerce enables organizations to deal with customers depending on
their preferences. Moreover, many companies enable customization of products through their web sites.
Information density: Information processing, storage, and communication costs drop dramatically, whereas
currency, accuracy, and timeliness improve greatly. Information becomes plentiful, cheap, and more
accurate.

1.6 Computer Based Information Systems


Categories of E-commerce:
Business to consumer: in this form of e-commerce, businesses sell products to customers. Organizations
provide products through interactive web sites.
Consumer to consumer: this type enables customers to sell their products to other customers like e-Bay.
Business to business: Electronic commerce involves sales of goods and services among businesses.
Companies are customers for other companies.

Supply Chain Management
A successful SCM strategy is based on accurate order processing, just-in-time inventory management, and
timely order fulfillment. SCM's increasing importance illustrates how a tool that was a theoretical process 10
years ago is now a hot competitive weapon.
A supply chain consists of all parties involved, directly or indirectly, in fulfilling a customer request. The supply
chain not only includes the manufacturer and suppliers, but also transporters, warehouses, retailers, and
customers themselves.

1.6 Computer Based Information Systems


Supply chain management helps managers efficiently integrate suppliers, manufacturers, warehouses, and
stores, so that merchandise is produced and distributed at the right quantities, to the right locations, and at the
right time, in order to minimize system-wide costs while satisfying service level requirements.
The following contains a successful real story of supply chain management in Coca Cola Beverage Company.

Coca-Cola Enterprises
A Modern Supply Chain for a Classic Beverage
When it comes to the world's most powerful brands, Coca-Cola is still number one.
The iconic beverage maker, which has dominated the global soft drink market for more than a century,
continued its 12-year reign at the top in 2011, according to Interbrand's latest global rankings.
For Coca-Cola, achievements like this are byproducts of a vision and an operating framework that is built on
excellence. At Coca-Cola Enterprises (CCE), the exclusive Coca-Cola bottler for its territories in Western
Europe, the company's goal is to be the number 1 or strong number 2 choice in every category it competes
in.

1.6 Computer Based Information Systems


But on the road to long-term, sustainable growth, CCE faces similar challenges to many other manufacturing
and logistics businesses. A top priority is replacing dated systems with a modernized platform across
markets to create a cohesive view of metrics and streamlined processes.
Bottling iconic brands in Europe
CCE is one of the world's largest marketers, producers and distributors of Coca- Cola products. CCE buys
concentrate from The Coca-Cola Company and combines it with other ingredients to create some of the
most popular beverages in Belgium, Great Britain, France, Luxembourg, the Netherlands, Norway and
Sweden.
In 2010, CCE completed a significant transaction with The Coca-Cola Company, selling its North American
operations, while retaining its European territories and acquired new bottling rights for Sweden and Norway.
CCE's executives recognized that establishing a uniform IT program across all of its business units would
be critical for expanding CCE's footprint in Europe.
"It is very important for us to have a set of consistent standards and processes, so that when we acquire
and integrate new territories into our business we can easily put those practices in place in a short time,"
says Kemal Cetin, vice president of European deployment at CCE

1.6 Computer Based Information Systems


Driving regional expansion with IT
As part of its Genesys program, CCE set out to deploy a new supply chain management solution at all 17 of
its European plants. The new system would replace and automate many of CCE's supply chain processes
and required new skill sets to ensure the required speed of deployment.
CCE needed a partner to help deliver this new SAP-enabled business transformation. This would involve not
only delivering a technology solution, but also training users on the new processes to ensure the full benefits
were realized.
CSC was selected because it has combined a strong 'front office' business transformation and change
management consulting capability with a 'back office' technology delivery capability for CCE since 2008.
Prior to Genesys, CSC had already been supporting CCE's applications with SAP, including order
processing, manufacturing, financial transactions, human resources, procurement and other related
processes.
"We started Project Genesys not as an IT project, but as a business transformation project to enable CCE's
day-to-day business to work in a harmonized way," says Cetin. "Since CSC knew our processes, people and
solutions, we thought that would carry over very well into the deployment process, and especially from an
acceleration perspective, because the learning curve would be relatively short."

1.6 Computer Based Information Systems


"Beyond that," Cetin adds, "CSC has very experienced and capable people from an implementation
perspective. And, we needed to make sure the cost-quality equation worked for us. CSC met our criteria and
satisfied us from that perspective as well."
Filling a gap between supply and demand
The Genesys program is an integrated SAP Enterprise Resource Planning (ERP) solution that will replace
CCE's legacy systems in the processes of "order to cash," "requisition to payment," and "record to
report." Genesys will allow CCE to shorten cycle time in these processes and be more productive. It will also
help bring more visibility into the business and improve decision making.
"We are a shelf-replenishment company, a supply chain company, a sales and customer services company,"
says Esat Sezer, senior vice president and chief information officer of CCE. "It is very important for us to
integrate our manufacturing plants all the way up to the replenishment of shelves in the retail outlets.
Through the information side of the equation, we are basically tying those two ends of the business process
together: the manufacturing side, which drives the supply of our product, and the shelf-replenishment side,
which drives the demand part of our product."

1.6 Computer Based Information Systems


"There are a lot of technology areas that require some capacity that we might not have or some technology
areas that we might not have the knowledge about," says Sezer. "So whenever we have those knowledge
gaps, we turn to our strategic partner CSC to fill in. Whenever an accelerated deployment need arises, we
leverage CSC, and we can generate value much more quickly."

Customer Relationship Management
Customer relationship management (CRM) is a business strategy used to help firms manage their relationships
with their customers. In order to build a strong relationship with customers, organizations need to know their
potential customers.
CRM uses information technology to create a cross-functional enterprise system that integrates and automates
many of the customer-serving processes in sales, marketing, and customer services that interact with a
company's customers.
Mostly, CRM systems support three areas: marketing, sales and customer services.

1.6 Computer Based Information Systems


Importance of CRM systems:
CRM systems contain data and analysis about customers which ease the search process and anticipate
customers need.
CRM applications can be used to identify potential, profitable customers through analysis of customer's
data stored in the system.
CRM applications help managers target specific customers depending on their preferences.
CRM systems help organizations not only retain existing customers but also attract new ones.
The strongest aspect of Customer Relationship Management is that it is very cost-effective. The
technologies used in implementing a CRM system are also very cheap and smooth as compared to the
traditional way of business.
All the details in CRM system is kept centralized which is available anytime on fingertips. This reduces the
process time and increases productivity.
Efficiently dealing with all the customers and providing them what they actually need increases the customer
satisfaction. This increases the chance of getting more business which ultimately enhances turnover and
profit.

1.6 Computer Based Information Systems


If the customer is satisfied they will always be loyal to you and will remain in business forever resulting in
increasing customer base and ultimately enhancing net growth of business.
CRM Applications:
Operational CRM: Customer facing applications such as tools for sales force automation, call center and
customer service support, and marketing automation.
Analytical CRM: Analytical CRM applications are based on data warehouses that consolidate the data from
operational CRM systems and customer touch points for use with online analytical processing (OLAP), data
mining, and other data analysis techniques.

Information System in Logistics and Transportation
Logistics describes the entire process of materials and products moving into, though, and out of a firm. Inbound
logistics covers the movement of materials received from suppliers.
Outbound logistics refers to the transport of finished goods from a company to the customers.
Logistics is a challenging and important activity because it links suppliers with customers and it integrates
functional entities across a company.

1.6 Computer Based Information Systems


The information systems in logistics are flexible tools for collecting, aggregating and analyzing data from the
operative applications.
In the Logistics Information System, data can be analyzed either as a standard analysis or as a flexible analysis.
Standard analyses are based on statistical data in the Logistics Information System, which is contained in
"information structures".
Flexible analyses allow you to evaluate any data structures and can be used for ad-hoc analyses.
The information systems in logistics can be used on a variety of levels in the decision-making process as a
management, control, and planning instrument.
It is also made up of different information systems illustrated in the following figure.

1.6 Computer Based Information Systems



The key element in a logistics chain is transportation system, which joints the separated activities.
Transportation occupies one-third of the amount in the logistics costs and transportation systems influence the
performance of logistics system hugely.
Transportation involves the movement of goods and raw materials. This includes shipment of raw materials to
the manufacturer and movement of finished product to the customer. Transportation also includes the movement
of parts to assembly areas as they are assembled.

1.6 Computer Based Information Systems


The role that transportation plays in logistics system is more complex than carrying goods for the proprietors. By
means of well-handled transport system, goods could be sent to the right place at right time in order to satisfy
customers' demands.
Today's trucks are equipped with computers, global positioning system and satellite communication devices.
Antenna on trucks receives real time orders from a central shipping office, especially when routing changes are
necessary, and transmits information about the truck, such as current location, the previous point of loading and
unloading, and the next point of loading or unloading.