Essay: Info Systems For PMF - Benefits & Management Decisions.

Benefits of using Information Systems

Question:

Discuss about the Information System and the Pyramid Model.

Introduction

Pepper Mint Food (PMF) is a business that is owned by Catherine Siddhoti and is based out of Maree. Catherine had started the business at her home and was started locals and tourists. There are six staff personnel in PMF and have been allocated in kitchen and delivery departments. With the increase in staff members and the expansion of business, it is becoming difficult for Catherine to manage everything through manual processes. The other competitors are gradually gaining advantage through this drawback and the use of Information Systems has been suggested to Catherine for efficient management.

Information Systems

Information systems are a combination of hardware and software that is required for the management of data-sensitive and data-driven applications (Systems and Systems, 2016).  It would help in the analysis and storage of the data. The prime purpose of Information Systems is to transform the raw data in to meaningful information (Study.com, 2016). A special form of such systems is a management information system (MIS), which provides information for managing an enterprise (WhatIs.com, 2016). These systems are divided in to two broad categories as:

• General purpose Information Systems
• Specialized Information Systems

Benefits of using Information Systems

• Communicatio

IS makes the communication between different parties easy and quick. Catherine can easily communicate with her staff members through instant messaging, emails and video calls.

• Globalization and cultural gap

The linguistic, cultural and geographical boundaries can be reduced with the adaption of Information Systems. Sharing of information and communication becomes a lot easier.

• Availability

Availability of the services at all times is desired by the customers. IS would enable PMF to make the information and the services available 24x7.

• Cost effectiveness and productivity

Supply of information to the decision-makers is an effective process required in the business.  Use of IS in PMF would ensure cost-savings and the productivity will also increase by a good percentage.

Information Systems for PMF

The basic requirements of PMF from IS are to manage the customer details, variety of meals and pricing information along with the salaries and management of the resources. Excellent delivery system and the management of raw materials is also desired by PMF.

The different types of Information Systems that would benefit PMF are as listed below.

• Transaction Processing Systems

These are the systems which are used to maintain and manage all the transaction involved with the organization.

• Payroll Systems
• Order processing systems
• Stock control systems
• Database management systems

The above four systems are suggested for PMF which would help Catherine in managing the salaries of the workers, process the delivery orders places by the customers, manage the raw material and pricing information and also monitor the inventories and products in an out of stock along with their quantities (Chris-kimble.com, 2016).

• Management Information Systems (MIS)

These are the systems that are used by the top and middle level management for smooth running of all the activities and operations.

• Budgeting Systems
• Inventory control systems

These can be used by PMF for detailed reports and would help in budgeting of the entire business and activities involved under it.

• Decision Support Systems

They offer access to databases, analytical tools, allow "what if" simulations, and may support the exchange of information within the organization. These are the knowledge based systems which are used for modeling and analytical purposes.

Information Systems for PMF

It would be of good aid for PMF for supporting the management decisions as they have analytical and modeling capability.

These would allow the management to make correct decisions such as those revolving around financial planning and logistics systems.

Management Decision through IS

Management decisions can be effectively taking with the help of suggested information systems for PMF. It would allow Catherine to

• Making a proper budget plan for the business
• Assess the demands and preferences of the users
• Predict the future demands through the analytics results
• Resource management and allocation of roles to the workers along with their wages and salaries
• Differentiate correctly between the internal and external data sources
• Decision on the expansion of business to other locations
• Extension of the delivery time to maintain the availability of the system at all times

Porter’s Competitive Force Model

Five Forces Model was designed by Porter to develop business strategies on the basis of five suggested factors (Resources et al., 2014). The model is as described below.

The model can be used by PMF for winning over the competitors in the market that is currently taking over the clients of PMF. It would also help in deciding the supplies and understanding of the preferences of the customers (Competition, 2015).

Use of Computer Networks in Communication and Collaboration

Computer networks such as intranets and extranets along with the internet are mandatory for PMF to have good communication management and collaboration with the stakeholders in place. Digital communication networks and local area network (LANs) can be utilized by Catherine to communicate with the staff and customers (vub.ac.be, 2016). It would be useful for PMF to

• Sharing of the resources among the team and staff
• Efficient exchange of information with the staff and customers
• Information sharing by using Web or Internet
• Interaction with other users using dynamic web pages
• Video conferences
• Parallel computing
• Instant messaging (tutorialspoint, 2016)

Management Challenges

Some of the management challenges that would occur and need to be implemented during the installation of Information Systems are:

• There are multiple models for the Information Systems on the basis of several factors. The choice of which model to adapt to can be challenging for Catherine
• Lending methodologies also differ as there is no generalized concept under this
• Resistance of employees to bring the newer systems in practice can be challenging as well. Proper training and manuals would have to be provided to the resources
• Cost constraints would also play a significant role as installation of Information Systems would require a budget to bring it in service (sa-dhan.net, 2016)

Social and Ethical Issues

Ethics are the principles that help in differentiating between right and wrong. IS has invited some of the ethical questions for individuals as well as for the society as it would bring along a vast social change and has the potential to threaten the existing systems in terms of money, rights and policies. These systems have the power to achieve excellent social progress and at the same time can be used to commit crimes related to information and digital media.

Ethical issues have emerged as an urgent issue in the world of Internet. IS makes it easier to assemble and integrate the information but the issues such as keeping the customer information safe along with the protection of policies and rights such as intellectual property and privacy emerge. Other pressing ethical issues raised by information systems include establishing accountability for the consequences of information systems, setting standards to safeguard system quality that protects the safety of the individual and society, and preserving values and institutions considered essential to the quality of life in an information society (prenhall.com, 2016).

The three Information Systems that have been recommended for PMF are Decision Support Systems, Transaction Processing Systems and Management Information Systems. Systems such as database management system, payroll system, budgeting system and stock management system are suggested under these Information systems. Also, there are several factors which are recommended to be considered to develop a competitive business strategy. The forces such as choice and preference of the users, preferred cost range, new entries in the market, technological advancements and developments along with the other suppliers should be considered before making an accurate business strategy.

Conclusions

PMF is a small business that has been serving its customers with pre-packaged meals. With the expansion of the business, it is required to have Information Systems in place such as transaction processing systems, Management Information Systems and Decision Support Systems. Porter’s competitive model is a five force model that explains five factors that can be utilized for PMF for developing accurate business strategies. Computer networks are also extremely important for communication and collaboration with the stakeholders. However, Information Systems also possess a few challenges and issues in terms of management challenges, social issues and ethical issues.

References

Chris-kimble.com. (2016). Different Types of Information System and the Pyramid Model. [online] Available at: https://www.chris-kimble.com/Courses/World_Med_MBA/Types-of-Information-System.html [Accessed 22 May 2016].

Competition, P. (2015). Porter's Five Forces: Analyzing the Competition. [online] Business News Daily. Available at: https://www.businessnewsdaily.com/5446-porters-five-forces.html [Accessed 22 May 2016].

prenhall.com, (2016). [online] Available at: https://www.prenhall.com/behindthebook/0132304619/pdf/laudon%20MIS10_CH-04%20FINAL.pdf [Accessed 22 May 2016].

Resources, H., insights, I., quotes, I., hubs, S., tips, C., Training, E., search, J., development, P. and Contributor, B. (2014). Porter's Five Forces Model | Strategy framework. [online] Cleverism. Available at: https://www.cleverism.com/porters-five-forces-model-strategy-framework/ [Accessed 22 May 2016].

sa-dhan.net, (2016). [online] Available at: https://www.sa-dhan.net/Adls/Microfinance/MIS/MISIssueschallenges.pdf [Accessed 22 May 2016].

Study.com. (2016). What Are Information Systems? - Definition & Types - Video & Lesson Transcript | Study.com. [online] Available at: https://study.com/academy/lesson/what-are-information-systems-definition-types-quiz.html [Accessed 22 May 2016].

Systems, I. and Systems, I. (2016). Information Systems - Journal - Elsevier. [online] Journals.elsevier.com. Available at: https://www.journals.elsevier.com/information-systems [Accessed 22 May 2016].

tutorialspoint,(2016).[online]Availableat:https://www.tutorialspoint.com/data_communication_computer_network/data_communication_computer_network_tutorial.pdf [Accessed 22 May 2016].

vub.ac.be, (2016). [online] Available at: https://www.vub.ac.be/BIBLIO/nieuwenhuysen/courses/chapters/network.pdf [Accessed 22 May 2016].

WhatIs.com. (2016). What is IS (information system or information services)? - Definition from WhatIs.com. [online] Available at: https://whatis.techtarget.com/definition/IS-information-system-or-information-services [Accessed 22 May 2016].