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BUS 237 (192)
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Chapter 2

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Department
Business Administration
Course
BUS 237
Professor
textbook
Semester
Fall

Description
BUS 237 Chapter 2 Notes Business Processes, Information, and Decision Making Business process is important because it central to every organization. It helps organization deliver goods/services to customers earning profit (achieving goals) We increase our value in the economy by understandings how things are put in place and interact with others. Business Processes  Sometimes called business system is a network of activities, resources, facilities, and information that interact to achieve some business objective  A set of activities needed to produce response to a stimulus applied to an organization  There are different types of business processes: o Inventory-management processes, manufacturing processes, sales processes, and customer-support processes  Routine business processes are usually computerized  Complex business processes are usually manually generated Components of a business process  Activities: transform information and resources from one type to another o It can be done manually, automated or usually a combination of both o Example: payment (activities) transforms quantity received and invoice (information) to a payment for the supplier (resource is money) o It must follow procedures and rules  Resources: items that have values o External, have value in the process so they are not activities o There are two types of resources external and internal to the company (example: cash, employees, inventory (controlled by the company), valued customers, creditors (cannot controlled))  Facilities: things that you can store data and information in (structures) o Example: inventories and databases  Information: data with meaning! Data that tells something relevant to the user. What we want to know about data. o Activities use information to transfer from inputs to outputs o Business create, process and store information o Example: the average minimal wage for a class is information collect from our data of all the class’s wage o Do something (summing, ordering, averaging, grouping, comparing or performing other functions) to data to produce information o Information can make a difference in decisions  Data: recorded facts and figures with no meaning  Characteristics of good information o Accurate: complete and correct data based so we can rely on the information to make the best decisions.  If the system is inconsistence with its information then it will ruin the reputation of the company and waste resources BUS 237 Chapter 2 Notes  Accurate information loses its value over time. o Timely: produce at time for intended use  However, it is hard to produce information that is near real time o Relevant to context and subject o Just barely sufficient: we do not want information overload where it is hard to find accurate information o Worth its cost: the cost for developing the information must be exceeded by the benefits that the information will bring to the company  Role of Information in business processes o Recall that business creates, processes and stores information and it uses that information by bringing together important items of data in a context  Example: Quantity received is different from the invoice quantity o We use information in business process to make decisions o We use the information from process to help understand how to many the process better and
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