Chapter 2 Business Processes Systems Information and Information
Chapter 2 Business Processes, Systems Information, and Information
“How Would We Do That? Where’s the Data? ” Ø Buyers don’t communicate with operations when negotiating with vendors Ø Buyers need data to look at prices and costs of dealing with individual vendors Ø Need more data and people involved in making negotiating deals. Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -2
Study Questions Q 1: Why does the Gear. Up team need to understand business processes? Q 2: What is a business process? Q 3: How can information systems improve process quality? Q 4: What is information? Q 5: What data characteristics are necessary for quality information? Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -3
Q 1: Why Does the Gear. Up Team Need to Understand Business Processes? • Needs to understand its existing processes and to identify the problems they have. • Needs to redesign its current processes. • Needs to know where and how to save costs? Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -4
Q 2: What is a Business Process? • Network of activities for accomplishing a business function • Such as: buying & managing inventory, making sales to customers, paying bills, collecting revenue, and hundreds of other business functions Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -5
Gear. Up Ordering Activities Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -6
How Gear. Up Works • Vendor agrees to sell certain quantity of items to Gear. Up at very low prices. • Gear. Up negotiates price and number of items, then conducts an auction on Gear. Up’s Web site. • After action closes, Gear. Up orders total number of items sold. • Gear. Up receives items in bulk from vendor, repackages them, and ships to customers. • Example: http: //www. zulilly. com/ Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -7
Existing Gear. Up Business Process Using BPMN Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -8
Process Symbols (BPMN Standard) Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -9
Components of a Business Process • Activities – Transform resources and information of one type into another type • Decisions – A question that can be answered Yes or No • Roles – Sets of procedures • Resources – People, or facilities, or computer programs assigned to roles • Repository – Collection of business records Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -10
Q 3: How Can Information Systems Improve Process Quality? • Dimension of Process Quality • Effectiveness: – Business process enables organization to accomplish its strategy. • Efficiency – Ratio of benefits to costs – Costs – time and infrastructure Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -11
Revised Gear. Up Process Using BPMN Buyers and Operations share a single, integrated repository of vendor data Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -12
Using Information Systems to Improve Process Quality Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -13
Gear. Up Data on General Sports Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -14
Q 4: What Is Information? 1. Knowledge derived from data, where data is defined as recorded facts or figures 2. Data presented in a meaningful context 3. Processed data, or data processed by summing, ordering, averaging, grouping, comparing, or other similar operations 4. A difference that makes a difference Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -15
Where Is Information? • Graph is not, itself, information • Graph is data you and others perceive, use to conceive information • Ability to conceive information from data determined by cognitive skills • People perceive different information from same data Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -16
Most Important Part of Any Information System Ø YOU! Ø Quality of your thinking, your ability to conceive information from data, determined by your cognitive skills Ø Information is value you add to information systems. Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -17
Experiencing MIS In. Class Exercise 2: How Much Is a Quarter Worth? • Some universities operate on quarter system of 10 -11 weeks each. Most students attend three quarters a year. • Majority of universities operate on 15 -16 week semester system. • One unit of credit in quarter systems is worth two-thirds of semester credit. Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -18
Experiencing MIS In. Class Exercise 2: How Much Is a Quarter Worth? (cont’d) Consider following business processes and their costs • Schedule classes • Allocate classrooms and related equipment • Staff classes • Enroll students • Prepare and print course syllabi • Adjust enrollments via add/drop • Schedule finals • Allocate final exam rooms • Grade finals • Record final grades Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -19
Experiencing MIS In. Class Exercise 2: How Much Is a Quarter Worth? (cont’d) Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -20
Q 5: What Data Characteristics Are Necessary for Quality Information? Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -21
How Does the Knowledge In This Chapter Help You? • Be able to document Gear. Up’s business processes, and explain in a professional way how Gear. Up should develop new or adjust existing information systems • Think about similar issues you will likely encounter in your career. Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -22
Ethics Guide: Egocentric vs. Empathetic Thinking (summary) • Egocentric thinking • Centers on self • Someone who considers his or her view as “the real view” or “what really is” • Empathetic thinking • Considers their view as one possible interpretation and actively works to learn what other people are thinking Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -23
Egocentric Thinking • “Professor Jones, I couldn’t come to class last Monday. Did we do anything important? ” • Egocentric Thinking Approach • Implies student isn’t accountable for his/her actions • Implies professor lectured on nothing important • Doesn’t take into account professor’s view of absences • Assumes professor has time to rehash class discussions and activities one-on-one • Puts responsibility on professor to remember everything said in class Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -24
Empathetic Thinking • Important skill in all business activities • Skilled negotiators always know what other side wants; effective salespeople understand customers’ needs • Buyers who understand problems of their vendors get better service Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -25
Guide: Understanding Perspectives and Points of View • Everyone speaks and acts from a personal perspective. • Everything we say or do is based on and by that point of view. • Conflicting perspectives can all be true. • Ability to discern and adapt to perspectives and goals of others will make you much more effective. Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -26
Ethics Guide: Understanding Perspectives and Points of View (cont’d) • You buy a new laptop and it fails within a few days. Repeated calls to customer support produce short-term fixes, but your problem continues. • Three plausible reasons for the problem 1. Customer service does not have data about prior customer contacts. 2. Customer support reps recommended a solution that did not work. 3. Company is shipping too many defective laptops. Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -27
Guide: Understanding Perspectives and Points of View (cont’d) • A “problem” is a perceived difference between what is and what ought to be • Development team needs a common definition and understanding of problem in order to communicate • What can a development team do to create common definitions and understanding? Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -28
Active Review Q 1: Why does the Gear. Up team need to understand business processes? Q 2: What is a business process? Q 3: How can information systems improve process quality? Q 4: What is information? Q 5: What data characteristics are necessary for quality information? Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -29
Case Study 2: Fulfillment by Amazon (FBA) Sold via Amazon. com Sold elsewhere Order handling (per order) $1. 00 $4. 75 (+) Pick & pack (per item) $1. 00 $0. 75 Weight handling (per pound) $0. 37 $0. 45 (+) Storage (cubic foot per month) Minimum $0. 45 Minimum $. 045 (rates vary by time of year) Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall 2 -30
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