Information Systems and Its Role in The Business Process Within an Organization

“Information Systems” is not a golden cloak that is adorned by the entire company. Information systems are tools/concepts that may be used in “varied ways” by the “different departments” that make up a company. Some may disagree and say that information systems may run an entire company if there is a centralized database and ERP (Enterprise Resource Planning) software, and where that may have been be true, nowadays in a cloud-powered and intra-networked world, the idea of a centralized database is redundant. However, let’s keep it simple and examine the role of information systems in a business in broad terms and in department-specific terms. (Markus, et al, 2000).

Information Storage

Data is collected by whatever means and must be stored. Is it imperative that businesses store information? No, it is not, but in this day-and-age it is “very tough” to run a business completely in real time with no form of data storage. A company doesn’t need to store information locally. If a company wishes, it may store information on the cloud or on remote servers. (Hammer, 1990).

For example:

An accountancy department is legally obliged to store information because most countries ask that you store information relating to your taxes for between six to ten years. A company that doesn’t store its accountancy information will not last long when the tax examiners start demanding information.

Information Analysis

It is fair to say that a company can get along without needing to analyze any of their information, but companies that conduct data analysis will often have an edge that helps them compete against their competitors. How the information is analyzed and what it is used for will vary from company to company and department to department. A budgeting team may analyze a company’s financial information to create spending budgets, whereas a stock analyst may analyze a company’s financial information to find out if a company’s stock is overpriced. (Lev, Baruch, and Ramu Thiagarajan 1993).

For example:

Modern gaming portals/websites will examine the types of games you have bought, games you have looked at, games you have placed on your wish list, and they will examine how long you played the games you own. They then send you offers and make recommended lists of games that are similar to the ones you have bought, played and looked at. In addition, they look for other players with similar gaming histories/preferences to you, and the gaming portal offers you the sorts of games that the other player liked too. It is a clever (albeit creepy) way to target consumers.

Decision Making

Information collection, storage and analysis may lead to certain conclusions. These conclusions may be used to make decisions within a company. The decisions will vary from which staff members to fire to which new products should be launched. Decision-making Information is not always collected first hand as a company may look to outside consultants and even news reports to help make decisions. (Ainsbury, et al. 2000).

For example:

The purchasing department sees that a new toy is being heavily promoted near to the Christmas holidays. The sheer weight of advertising behind the new toy suggests that it may sell well as Christmas approaches, so the purchasing department makes a decision to buy that toy and stock it on mass in their stores.

Business Continuity

The term “Business Continuity” was used because writing “Business operations” or “Business processes” may have appeared a little confusing in this context. To continue running your business, for your business to perform efficiently, you need the help of various information systems. (Cerullo, Virginia, and Cerullo, 2004).

For example:

A grocery store logs how many bags of carrots it buys. It then automatically logs how many are sold via the checkout. Admin staff will occasionally count the bags of carrots to amend stock numbers because of possible wastage, depreciation and/or shrinkage (loss/theft). This process involves information collection, storage and analysis. It is used to power business continuity because when the information systems show that they are low on bags of carrots, then orders for new bags are placed automatically. Plus, by further analysis of purchase patterns, a company is able to better predict how many bags of carrots will be needed in the coming weeks.

Bibliography

Ainsbury, Robert D., et al. “Method and apparatus for performing data collection, interpretation and analysis, in an information platform.” U.S. Patent No. 6,078,924. 20 Jun. 2000.

Cerullo, Virginia, and Michael J. Cerullo. “Business continuity planning: a comprehensive approach.” Information Systems Management 21.3 (2004): 70-78.

Hammer, Michael. “Reengineering work: don’t automate, obliterate.” Harvard business review 68.4 (1990): 104-112.

Lev, Baruch, and S. Ramu Thiagarajan. “Fundamental information analysis.” Journal of Accounting research (1993): 190-215.

Markus, M. Lynne, Cornelis Tanis, and Paul C. Van Fenema. “Enterprise resource planning: multisite ERP implementations.” Communications of the ACM 43.4 (2000): 42-46.