Discuss about the Information Systems for Enterprise Integration.
Enterprise Information System (EIS) refers to the particular information system that helps the business organizations to bring improvements in the functions of business processes with the help of integration. In an organization, EIS has both informational and operational functions. The implementation of EIS helps the organizations to bring efficiency in their business processes.
The major difference between inwardly and outwardly organized systems is that inwardly system assists in receiving the organizational documents and applications while outwardly system helps in the process of follow ups of those documents and applications. From the above point, it can be said that inwardly organized system’s function is to prepare report about total receivable application and outwardly organized system’s function is to prepare report regarding total follow ups. Both help the companies in the process of data backup.
Financial and Non-financial Benefits
There are both financial and non-financial benefits of the adoption of EIS for Prime Devices (PD). The major financial benefit that PD can get from the adoption of EIS is the reduction of manufacturing cost of the company and this process leads to increased revenue and profitability. The major non-financial benefit is that PD will be able to increase the efficiency of the whole manufacturing operations. It will provide PD with competitive advantage.
Reduction of the selling price of PD will be a major parameter for the implementation of EIS in PD. In case EIS helps in cost reduction, the selling price of the company is bound to be decreased. If not, then the implementation needs to be considered as unsuccessful. The next parameter is timely coordination among procurement, assembling and others. In case, coordination can be seen among these factors, then the implementation needs to be considered successful.
The implementation of EIS will reduce the daily accounting tasks undertaken by the accounts of PD and this process will lead to the routinization of accounting works in the company. The implementation of EIS system in PD will provide the organizational accountants with speedy accounting information so that they do not have to wait for them. This will increase the efficiency of the whole accounting process of PD.
First, the implementation and maintenance costs of EIS are huge for the companies as it is a computerized system. This can become a major constrain PD for EIS implementation. Second, the concern of public regarding environment-sensitive companies can become a hurdle for PD in EIS implementation as the EIS needs to be implemented as per environmental management accounting processes. In addition, skill and knowledge can be constrains as the running of EIS requires specific skills and knowledge.
Mechanism to Overcome Constrains in PD
Before the implementation of EIS, PD needs to ensure that there is sufficient fund to support the implementation of EIS as the lack of funds can hamper the implementation process of EIS in PD. After that, at the time of EIS implementation, PD needs to ensure the fact that the implementation process complies with the policies of environmental management accounting policies. These are the mechanisms that PD needs to take for effective EIS implementation.
According to above discussion, it is recommended that PD should adopt EIS for their business operations as it will reduce the cost of production, selling price, will provide competitive advantage and others. Thus, PD needs to implement both inwardly and outwardly EIS system for their business operations. Both types of EIS need to be implemented as they will ensure the process to receive all the business documents as well as the process to follow up. In addition, they will help in cost reduction and will bring efficiency.
Environmental management accounting takes into account the generation and analysis of both financial and non-financial information to support internal environmental management processes. Thus, it is needed for PD to follow and adopt all the policies and principles of environmental management accounting in order to make the company more environments friendly.
From the above discussion, it can be concluded that EIS has a big role to play in the business operations of PD. It will help PD to reduce the costs as well as the selling price. There are also many other benefits of EIS. Thus, it is needed for PD to adopt EIS. In addition, PD needs to adopt the policies of environmental management accounting to make the company more environments friendly.
Bulyshev, Alexander E., et al. "Enterprise Information Systems."
Laudon, Kenneth C., and Jane P. Laudon. Management information system. Pearson Education India, 2016.
Motiwalla, Luvai F., and Jeffrey Thompson. Enterprise systems for management. Boston, MA: Pearson, 2012.
Panetto, Hervé, and Joe Cecil. "Information systems for enterprise integration, interoperability and networking: theory and applications." (2013): 1-6.
Varajao, Joao. "Enterprise information systems." The Learning Organization 20.6 (2013).
Ward, Keith. Strategic management accounting. Routledge, 2012.