MIS 2000
Instructor: Bob Travica
Class 7
Process View of Organization
and Information Systems
Updated: January 2015
Outline
• Cases of IS roles in business processes (expanding over
Chapter 5)
– IS impacts on process design optimization
– Impacts of process design on process performance
• Typologies of information systems
• Summary
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DESIGN OPTIMIZER
ROLE
PERFORMANCE BOOSTER
ROLE
Information
System
Technological
Properties
BUILDING BLOCK ROLE
• Recalling from the last lecture, IS has three roles in business
processes:
– Technological characteristics of IS make the building block in
process design
– IS Functionality makes IS the process optimizer
– Non-functional characteristics of IS are the process
performance booster
Focus in this lecture is on relationships marked with yellow arrows:
Process
Performance
Process Design
Organizational
Performance
Information
System
• IS and Process Design
• Process design and Process Performance
IS and Process Composition


IS can help to optimize Process Composition.
IS can influence the selection of activities, performers (workers), departments,
and organizations to be included in a process.
•
•
Example: A new Purchasing TPS implemented at Ford made its purchasing
order process: different work activities than those used before.
Example: A computer network linking information systems at Kia and
service shops in support to inter-organizational quality control process.
5
IS and Process Complexity

IS and Process Complexity: IS can absorb complexity or simplify process a
process looking from the perspective of process performers. The number of
manual steps is reduced. This is possible because IS performs some
activities and decisions instead of people (automation).
•
Example: A Decision Support System performs very complex
calculations so that a decision maker is spared of such steps – decision
process looks simpler.
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IS and Process Coordination

IS and Process Coordination: IS can enhance coordination among the process
activities and process performers.
•
•
Example: The supply process at Walmart uses inventory management systems
linked via a corporate network; data transfer across supply chain between
Walmart stores, Walmart distribution centres, and suppliers.
Group decision making process that includes a GDSS makes it possible for
decision makers to brainstorm in parallel rather than in sequence. IBM was a
big user of GDSS.
Facilitator
drives the
session
Decision makers
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IS and Process Design - Flexibility

IS and Process Flexibility: IS can contribute to controlling variation in a process.

Think of variation in terms of availability of options (usually desirable), and
deviation from a benchmark (usually undesirable).

Example A: Various reservation processes (hotel, travel, university course) could
be done with the start activities supported by different technologies (telephone,
cell phone, Website, email). The process has several versions.
 Example B: The quality control process in manufacturing
rests on controlling variation between a part under
production and desired benchmarks (size, etc.). Today,
quality control process is automated and IS continuously
inspect and report on the state of production.
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Process Design and Process Performance
Based on cases discussed so far:
Process Design
Aspect Impacted
by IS
Process Performance Aspect
Time
Cost
Customer Value
Composition
improvement
Savings in process
time at Ford
Labor reduced at Ford
Quality improved at
Kia
Complexity
reduction
Savings in decision
making process
Fewer people needed
for calculations
Better decisions
Coordination
improvement
- Efficiencies in
Walmart’s supply
chain
Price of saved labor
hours (cost
avoidance)
- Satisfied partners
in Walmart supply
chain
- Savings in meeting
time with GDSS
- Shorter meetings,
reduced opportunity
cost
- Better ideas for
mgmt.
Automated quality
control in car production streamlined
Waste reduction due
to better quality
control
Flexibility
- Product quality
gains
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Typologies of Information Systems Time Focus
Information systems studied in this course:
•
•
•
•
•
•
•
•
Transaction Processing system (TPS)
Management Information System (MIS)
Decision Support System (DSS)
Knowledge Work System (KWS)
Group Support System (GSS)
Communication Systems
Office Automation System (OAS)
Enterprise Resource Planning System (ERPS)
Typologies show similarities and differences between these
systems looking from different angels.
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Typologies of Information Systems:
Organizational Function & Time Focus
• Based on Org. Function:
- Production system
- Accounting IS
- HRIS
- Sales system…
- Usually TPS & MIS
• Different data content –
look back at schemas for
different business
domains
• Based on time focus:
• Past/present focused:
– Supporting & recording
current operations
– Reporting on the past
business
• Future focused
– Planning, predicting
– Longer range decision
making
Past
Now
TPS, MIS
Future
DSS
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Typologies of Information Systems (IS): User Focus
Different systems serve different groups of users.
System types have different level of detail, processing capabilities, and outputs.
Executive
Management
Management Information
System (MIS) - Mid-range
performance control & planning
Mid-level
Management
Transaction Processing
system (TPS) - Daily
operations control
Supervisory
Management
Knowledge Work
Systems
(professionals)
Decision Support System (DSS)
- Strategic decision making
Group Support
Systems
(any teams)
Communication
Systems
(everybody)
Office Automation
Systems
(clerks, others)
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Typology of Information Systems:
Cross-referencing
• Relationship between IS types based on org. function and management
user groups:
Organizational
Function-based IS
User-based IS Type
Human Resources IS
(HRIS)
TPS
MIS
DSS
Management Level
Supervisory
Middle
Executive
Database of
travel claims
with some
queries
Atop TPS; more
queries and reports
with aggregate travel
expenses for longer
periods
Atop MIS; aggregate annual
figures, and projecting future
expenses and budget needs
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Summary
• IS can help to optimize process design (Composition, Complexity,
Coordination, Flexibility)
• Improvements in process design reflect in process performance
(Customer Value, Cost, Time)
• IS types can be differentiated on the bases of organizational
function, time, and user group.
• IS types serving management groups are TPS, MIS and DSS.
• IS typologies can be cross-referenced (same system shown as
different types).
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