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Survey of Business Information Systems. “The value of a program is proportional to the weight of its output . “ Laws of Computer Programming, VI. Levels of Business Activity. Operational Tactical Strategic Supported by Information Systems Transaction Processing Systems

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Survey of business information systems

Survey of Business Information Systems

“The value of a program is proportional to the weight of its output. “

Laws of Computer Programming, VI


Levels of business activity
Levels of Business Activity

  • Operational

  • Tactical

  • Strategic

  • Supported by Information Systems

    • Transaction Processing Systems

    • Management Information Systems

    • Decision Support Systems

Strategic

Tactical

Operational


Operational activities
Operational Activities

External

Environment

Corporation

  • Day-to-day activities

  • Acquire and consume resources

  • Transaction Processing System

    • Acquire data about an event

    • Update corporate database

    • Generate an appropriate response

  • Example - invoice/payment

Event

TPS

Response

Database


Characteristics of tps
Characteristics of TPS

  • Real inputs and outputs (cash) - accuracy is important

  • On-line

  • Foundational data, to be summarized for higher-level applications


Tactical activities
Tactical Activities

  • Monitoring activities

  • Allocating and organizing resources

  • Management information systems

    • Provides information about company to support management decision making

    • Output consists of reports

      • Regular

      • Ad hoc

      • Exception

    • Transforming data into information

      • Summarizing

      • Aggregating

      • Put into context


Strategic activities
Strategic Activities

  • Deciding on long-term goals, organization, governing policies

  • Unstructured decision making process

  • Decision support systems


Decision support systems
Decision Support Systems

  • Relatively new category - still developing

  • “Toolkit” of components

    • Query of corporate data (OLAP)

    • Statistical analysis (SPSS, SAS)

    • Scenario modeling, forecasting (spreadsheet)

    • Environmental scanning (Internet, LEXIS/NEXIS)


Accounting information systems
Accounting Information Systems

  • One of the earliest

  • Most mature category

    • Well-established set of rules

  • Package software

  • The accounting equation

    • Assets = Liabilities + equity


Accounting information systems cont
Accounting Information Systems (cont.)

  • Equation has to be kept in balance

    • Receiving an invoice

    • Paying a bill

  • Double-entry bookkeeping

  • Standard accounting reports

    • Income statement

    • Balance sheet


Accounting information systems cont1
Accounting Information Systems (cont.)

  • Package features

    • Customizable chart of accounts

    • Modular

    • Heavy security and data integrity features

    • Set of standard reports, with report-writing features


Accounting information systems cont2
Accounting Information Systems (cont.)

  • Chart of accounts

    • Package may impose a general numbering system that can be customized:

      • 1xxx = asset accounts

      • 2xxx = liabilities

      • 3xxx = equity

    • Will have to develop organization’s chart of accounts


Accounting information systems cont3
Accounting Information Systems (cont.)

  • For conversion purposes, must determine initial balances

  • Define accounting rules (i.e.: capitalization thresholds)


Accounting information systems cont4
Accounting Information Systems (cont.)

  • Accounting modules

    • General ledger

    • Accounts payable

    • Accounts receivable

    • Inventory/Order entry

    • Payroll (Human Resource)

A/P

A/R

G/L

Inventory

Payroll


Accounting information systems cont5
Accounting Information Systems (cont.)

  • General Ledger

    • Heart of the system

    • Maintain balances in the accounts

    • Entry, editing and posting of entries

    • G/L account inquiry

    • Produce income statement and balance sheet


Accounting information systems cont6

Accounts Receivable

Uses and maintains G/L data

Also maintains separate data

Customer file

Open invoices

Sales history

Records sales, receipts

Prints invoices

Postings to G/L

A/R

Cash

Exception processing

Partial or incorrect payment

Discounts

Interest or other charges (bounced checks)

Credit memos

Corrections to invoices

Management reports

Aged A/R report

Accounting Information Systems (cont.)


Accounting information systems cont7

Accounts Payable

Uses and maintains G/L data, plus

Vendor file

Invoice file

Records invoices received

Determines when invoices should be paid. How?

Invoice must be approved (link to a P.O.)

May be a check-writing module attached

G/L postings

Cash

A/P

Discounts taken

Exception processing

Disputed invoices

Credit memos

Duplicate invoices

Accounting Information Systems (cont.)


Accounting information systems cont8

Inventory/Order entry

Tracks inventory based on sales and purchasing activity

Reconcile against physical inventory

Records sales, generate “picking tickets, packing slips

Valuation of inventory (LIFO vs. FIFO, other methods)

Allow on-line query of order status

Generate back-orders or purchasing advice when needed

Exception processing

Adjustments to reconcile to physical inventory

Cancelled orders

Accounting Information Systems (cont.)


Accounting information systems cont9

Payroll

Maintain employee master file (what kind of information?)

Compute pay

Gross (salary, wages, bonus)

Deductions (taxes, FICA, benefits)

Maintain employee totals for year-end forms

Maintain leave balances

Exception processing

Garnishee of pay

Medical savings accounts

Bonuses

Accounting Information Systems (cont.)


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