Information systems for the firm

1. Information systemsfor the firm Main classification (Source : Laudon & Laudon, Prentice- Hall, 2000)

2. Four levels of applications of I.S. in the firm : • Strategy level : I.S. for top executives • Management level : I.S. for middle management • “Knowledge” level : I.S. for office employees • Operations level : I.S. for production, sales, marketing, accounting, and H.R. functions

3. Operations level : I.S. to treat day to day transactions

4. Example with Sales • For one sale we want to have all the following information : • which product range • which product • which month • which region of the World • which type of client (large account, national account, small account…) • which salesperson made the sale • the sales figure • the delivery choice • the payment facilities • etc. (the number of visits before the sale…)

5. “Knowledge” level : two types of information system • Systems for office basic work : • Word processing • Document and image creation • Electronic calendar (Outlook…) • Systems for intellectual work : • Engineering work stations and softwares • Management work stations and softwares

6. A peep into an engineering office • Up until the late 70 ’s engineers worked only on drawing boards (large slanted tables) • In the 80 ’s the CAD/CAM systems were adopted in all large manufacturing firms • On « work stations » • Renault & Dassault were innovators in the field : the program Catia...

7. Management level : two types of information system • Management information systems : • Sales management • Stock control • Annual budgeting • Capital investment control • Carriers evolution management • Systems to assist middle mgt. decision process : • Sales analysis by region • Production planning • Costs analysis and costs control • Price analysis and profitability analysis

8. Strategy level : I.S. for top executives • Five year sales forecast • Five year operation planning • Five year budget forecast • Profitability forecast • Human resources planning

9. IS for top executives • Computer Aided Decision softwares • (in French : Système d  ’Information et d ’Aide à la Décision SIAD) • In the near future they will have more such softwares : • to sift through large amounts of information • to find signals • to find patterns • The Darpa Tias program will lead to such softwares (see also Datops)

10. Features and users of I.S.

11. Evolution of Information Systems • Information Systems entered the firms in the sixties : • They were first concerned with accounting, and with production control • Later, in the eighties and nineties, they entered all the other functions of the firm (from bottom up) : • I.S. can increase tremendously the firm productivity • Information is now considered a “product” of strategic value, whereas a generation ago it was only “red tape”

12. An example : • When it was clearly realized that gaining a new client was about 5 times more expensive than keeping an existing one, and that I.S. provided new means to analyze and retain clients, C.R.M. (Client Relationship Management) was born. • “The most efficient selling action is to treat as well as possible your existing clients” • They are not only your best future clients, they also are your best salespeople, and the beauty : they are free • In order to do that you have to know them very well, and customize your relationship with them.