MGAC70H3 Study Guide - Final Guide: Sales Force Management System, Data Warehouse, Online Transaction Processing
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management information systems (MIS) deals with the planning for, and development, management, and use of information
technology tools to help people perform all tasks related to information processing and management
information exhibits high quality only if it is pertinent, relevant, and useful to the person using them
within an organization, information flows in 4 basic directions:
1. Upward. Upward information flows describe the current state of the organization based on its daily transactions. Along the
way, the information takes on a finer level of granularity. Information granularity refers to the extent of detail within the
information. At lower organizational levels, information exhibits fine granularity because people need to work with
information in great detail. At the upper organizational levels, information becomes coarser because it is summarized or
aggregated in some way.
2. Downward. Strategies, goals, and directives that originate at a higher level are passed to lower levels in downward
information flows. The upper level of an organization develops strategies; the middle levels of an organization convert those
strategies into tactics; and the lower levels of an organization deal with the operational details.
3. Horizontal. Information flows horizontally between functional business units and work teams. The goal here is to eliminate
the old dilemma of “the right hand not knowing what the left hand is doing”.
4. Outward/inward. Information is communicated from and to customers, suppliers, distributors, and other partners for the
purpose of doing business. These flows of information are really what electronic commerce is all about. Today, no
organization is an island, and outward/inward flows can yield a competitive advantage.
information is internal or external, objective or subjective, and various combinations of these
1. Internal information describes specific operational aspects of an organization.
2. External information describes the environment surrounding the organization.
3. Objective information quantifiably describes something that is known.
4. Subjective information attempts to describe something that is unknown.
a technology-literate knowledge worker knows how and when to apply technology
an information-literate knowledge worker can define what information is needed knows how and where to obtain information;
understands the information once it is received (i.e., can transform the information into business intelligence); and can act
appropriately based on the information to help the organization achieve the greatest advantage
the Five Forces Model helps business people understand the relative attractiveness of an industry and the industry’s competitive
pressures in terms of the following five forces: (1) buyer power; (2) supplier power; (3) threat of substitute products or services; (4)
threat of new entrants; and (5) rivalry among existing competitors
buyer power is high when buyers have many choices from which to buy, and low when their choices are few
supplier power is high when buyers have few choices from which to buy, and low when their choices are many
threat of substitute products or services is high when there are many alternatives to a product or service, and low when there are few
the threat of new entrants is high when it is easy for new competitors to enter a market, and low when there are significant entry
barriers (product or service feature that customers have come to expect from organizations in a particular industry and that must be
offered by an entering organization to compete and survive) to entering a market
the rivalry among existing competitors is high when competition is fierce in a market, and low when competition is more complacent
Three Generic Strategies to beating competition in any industry—(1) overall cost leadership, (2) differentiation; and (3) focus
top-line versus bottom-line: (1) top line strategy focuses on increasing revenues by increasing market share, cross-selling
complementary products, etc.; and (2) bottom line strategy focuses on decreasing costs by optimizing processes, reducing errors, etc.
the following are the aspects of the run-grow-transform (RGT) framework:
o Run—optimize the execution of activities and processes already in place. Seek organizational growth through offering
products and services faster and cheaper than the competition.
o Grow—increase market reach and product and service offerings; expand market share; and so on. Seek organizational growth
by taking market share from the competition (i.e., get a bigger piece of the pie).
o Transform—innovate business processes and/or products and services in a completely new way, move into seemingly different
markets, and so on. Seek organizational growth through new and different means.
value chain analysis is systematic approach to assessing and improving value of business processes to increase competitive strengths
primary value processes takes in the raw materials and makes, delivers, markets, and sells, and services products or services
support value processes—firm infrastructure (culture, structure, control systems, accounting, legal, and so on), human resource
management, technology development, and procurement (purchasing of raw materials)—support the primary value processes
supply chain management (SCM) tracks inventory and information among business processes and across companies
a SCM system is an IT system that supports supply chain management activities by automating the tracking of inventory and
information among business processes and across companies
the primary focus of supply chain management may be described as overall cost leadership (from Porter’s three generic strategies);
bottom-line initiative (cost reduction); and running the organization (run-grow-transform framework)
a CRM system uses info about customers to gain insights into their needs, wants, and behaviours in order to serve them better
CRM systems include sales force automation, customer service and support, and marketing campaign management and analysis
sales force automation (SFA) systems automatically track all the steps in the sales process, including contact management, sales lead
tracking, sales forecasting and order management, and product knowledge
the primary focus of customer relationship management is differentiation and focus (Porter’s three generic strategies); top-line
initiative (revenue enhancement); and growing the organization (run-grow-transform framework)
e-collaboration is the use of technology to support—(1) work activities with integrated collaboration environments; (2) knowledge
management with knowledge management systems; (3) social networking with social networking systems; (4) learning with e-
learning tools; and (5) informal collaboration to support open-source information
on-line transaction processing (OLTP) is the gathering of input information, processing of that information, and updating of existing
information to reflect the gathered and processed information
databases and database management systems are the technology tools that directly support OLTP
on-line analytical processing (OLAP) is the manipulation of information to support decision making
a relational database is actually composed to 2 distinct parts: (1) the information itself, stored in a series of two-dimensional tables,
files, or relations and (2) the logical structure of that information
a database management system (DBMS) helps to specify logical organization for a database and to access and use the info within it
a DBMS contains 5 important software components—(1) DBMS engine; (2) data definition subsystem; (3) data manipulation
subsystem; (4) application generation subsystem; and (5) data administration subsystem
a data warehouse is a logical collection of information—gathered from many different operational databases—used to create
business intelligence that supports business analysis activities and decision-making tasks
a data mart is a subset of a data warehouse in which only a focused portion of the data warehouse information is kept
data administration is function in an organization that plans for, oversees the development of, and monitors the information resource
this function must be in tune with strategic direction of the firm to assure that all information requirements can be and are being met
database administration is the function in an organization that is responsible for the more technical and operational aspects of
managing the information contained in organizational information repositories (databases, data warehouses, and data marts)
in business, decision making has four distinct phases:
1. Intelligence: find what to fix. Find or recognize a problem, need, or opportunity. It involves detecting and interpreting signs
that indicate a situation needs your attention.
2. Design: find fixes. Consider possible way of solving the problem, filling the need, or taking advantage of the opportunity. In
this phase, the firm develops all the possible solutions it can.
3. Choice: pick a fix. Examine and weigh the merits of each solution, estimate the consequences of each, and choose the best one.
4. Implementation: apply the fix. Carry out the chosen solution, monitor the results, and make adjustments as necessary.
there are 4 main types of changes—(1) structured, (2) unstructured, (3) recurring, and (4) nonrecurring
a structured decision involves processing a certain kind of info in a specified way so that the right answer is always found
a unstructured decision is one for which there may be several “right” answers, and there is no precise way to get a right answer
a recurring decision is one that happens repeatedly, and often periodically, whether weekly, monthly, quarterly, or yearly
a nonrecurring, or ad hoc, decision is one that is made infrequently (perhaps only once) and there may be different criteria for
determining the best solution each time
a decision support system (DSS) is a highly flexible and interactive IT system that is designed to support decision making when the
problem is not structured; it is an alliance between the decision maker and specialized support provided by IT
a typical DSS has three components: model management, data management, and user interface management
a geographic information system (GIS) is a decision support system designed specifically to analyse spatial information
the AI systems that businesses use most can be classified into the following major categories: (1) expert systems; (2) neural networks
(and fuzzy logic); (3) genetic algorithms; and (4) intelligent agents (or agent-based technologies)
essentially there are four types of intelligent agents—(1) information agents (including buyer agents or shopping bots); (2) data-
mining agents; (3) monitoring-and-surveillance agents; and (4) user or personal agents
agent-based modelling is a way of simulating human organizations using multiple intelligent agents, each of which follows a set of
simple rules and can adapt to changing conditions
Within an organization, information flows in 4 basic directions: upward. Upward information flows describe the current state of the organization based on its daily transactions. Along the way, the information takes on a finer level of granularity. Information granularity refers to the extent of detail within the information. At lower organizational levels, information exhibits fine granularity because people need to work with information in great detail. At the upper organizational levels, information becomes coarser because it is summarized or aggregated in some way: downward. Strategies, goals, and directives that originate at a higher level are passed to lower levels in downward information flows. The upper level of an organization develops strategies; the middle levels of an organization convert those strategies into tactics; and the lower levels of an organization deal with the operational details: horizontal. Information flows horizontally between functional business units and work teams.