Management Information Systems CH 2 Notes
Management Information Systems
Chapter 2
COMPONENTS OF A BUSINESS
A business is a formal organization whose aim is to produce products or provide services for a profit – that is, to sell products at a price greater than the costs of production.
ORGANIZING A BUSINESS: BASIC BUSINESS FUNCTIONS
The decision of what to produce is called a strategic choice because it determines your likely customers, the kind of employees you will need, the production methods and facilities needed, the marketing themes, and many other choices.
The five basic entities in a business with which it must deal are: suppliers, customers, employees, invoices/payments, and, of course, products and services.
BUSINESS PROCESSES
The actual steps and tasks that describe how work is organized in a business are called business processes.
A logically related set of activities that define how specific business tasks are performed.
Also refer to the unique ways in which work, information, and knowledge are coordinated in a specific organization.
Manufacturing & Production
Assembling the product
Checking for quality
Producing bills of materials
Sales & Marketing
Identifying customers
Making customers aware of the product
Selling the product
Finance & Accounting
Paying creditors
Creating financial statements
Managing cash accounts
Human Resources
Hiring employees
Evaluating employees’ job performance
Enrolling employees in benefits plans
Interorganizational includes interactions with delivery firms and customers who are outside the boundaries of the organization.
Cross-functional includes interactions between one or more departments of an organization
HOW INFORMATION TECHNOLOGY ENHANCES BUSINESS PROCESSES
Information systems automate many steps in business processes that were formerly performed manually, such as checking a client’s credit, or generating an invoice and shipping order.
MANAGING A BUSINESS AND FIRM HIERARCHIES
The hierarchy of management is composed of senior management, which makes
Chapter 2
COMPONENTS OF A BUSINESS
A business is a formal organization whose aim is to produce products or provide services for a profit – that is, to sell products at a price greater than the costs of production.
ORGANIZING A BUSINESS: BASIC BUSINESS FUNCTIONS
The decision of what to produce is called a strategic choice because it determines your likely customers, the kind of employees you will need, the production methods and facilities needed, the marketing themes, and many other choices.
The five basic entities in a business with which it must deal are: suppliers, customers, employees, invoices/payments, and, of course, products and services.
BUSINESS PROCESSES
The actual steps and tasks that describe how work is organized in a business are called business processes.
A logically related set of activities that define how specific business tasks are performed.
Also refer to the unique ways in which work, information, and knowledge are coordinated in a specific organization.
Manufacturing & Production
Assembling the product
Checking for quality
Producing bills of materials
Sales & Marketing
Identifying customers
Making customers aware of the product
Selling the product
Finance & Accounting
Paying creditors
Creating financial statements
Managing cash accounts
Human Resources
Hiring employees
Evaluating employees’ job performance
Enrolling employees in benefits plans
Interorganizational includes interactions with delivery firms and customers who are outside the boundaries of the organization.
Cross-functional includes interactions between one or more departments of an organization
HOW INFORMATION TECHNOLOGY ENHANCES BUSINESS PROCESSES
Information systems automate many steps in business processes that were formerly performed manually, such as checking a client’s credit, or generating an invoice and shipping order.
MANAGING A BUSINESS AND FIRM HIERARCHIES
The hierarchy of management is composed of senior management, which makes