33 terms

Business Processes

What is a business process?
A business process is a network of activities, resources, facilities and information that interact to achieve some business function.

A business process is a system, sometimes they are referred to as business systems
What are some examples of business processes?
Inventory management processes, manufacturing processes, sales and support processes
What are activities?
Activities transform resources and information of one type into resources and information of another type

Example: The payment activity transforms, QtyReceived and ShippingInvoice information into a SupplierPayment (resource)
What are resources?
Items of value. A case of milk, a cheque, customer's cash are all resources
What are facilities
Facilities are structures used within the business process

Examples: inventories and databases. Other examples of facilities are factories, pieces of equipment, trucks, etc
What is information?
Information is knowledge derived from data. Activities use information to determine how to transform the inputs they receive into outputs they produce
What are some of the definitions of information?
Information is knowledge derived from data, where data is defined as recorded facts or figures

Information is data presented in a meaningful context

Information is processed data, or data processed by summing, ordering , averaging and other similar functions

Information is a difference that makes a difference.
What are characteristics of good information?
Accurate - correct & complete data, processed correctly
Timely - produced in time for its intended use
Relevant - to both context and to subject
Just Barely Sufficient - just enough for its purpose
Worth Its Cost - value is higher than cost to get / information
What is the difference between information and data
QtyRecvd by itself is data (a recorded fact or figure).
ShippingInvoice by itself is data (we were supplied these items on this date)

Bring both together we generate information. We can compare qty we received vs qty we were paid to look for a difference
What does it mean to automate a process activity?
When an activity in a business process is handled by an automated system it means that work formerly done by people following procedures has been moved so that computers now do that work by following instructions in software
What does automation do?
Moves work from human side to computer side
Decisions in an organization occur at what three levels?
What are operational decisions?
Operational decisions concern day to day activities. Typical decisions are - how many widgets should we order from Vendor A. Should we extend credit to vendor B?
What are information system that support operational decision making called?
Transaction processing systems (TPS)
What does TPS stand for?
Transaction processing systems. Used to support operational decision making
What are managerial decisions?
Managerial decisions concern the allocation and utilization of resources. Typical managerial decisions are - how much should we budget for computer hardware for a dept. Next year? How many engineers should we assign to a project? How many sq feet of warehousing do we need for next year
What are informational systems that support managerial decision making called?
Management Information Systems (MIS)
What is MIS?
Management Information System

The term can be used in two ways - broadly to mean the subjects in the entire text book, or info systems that support managerial level decision making
What are strategic decisions?
Strategic decisions concern broader-scope, organizational issues. Typically decisions at a strategic level are - should we start a new product line? Should we open a centralized warehouse in Calgary? Should we acquire company A?
What are the informational systems that support strategic decision making called?
Executive Information Systems (EIS)
What does EIS stand for
Executive Information Systems. The informational system that support strategic decision making
What does MIS stand for?
Management Information System
What characteristic can be seen as regarding decisions as you move from operational -> managerial -> strategic decision making?
The decision time frame increases

Operational - short term (today or this week)
Managerial - longer (next quarter or year)
Strategic - long term (years +)
Based on the method decisions are made, what are the two types of decisions?
Structured and unstructured
What is the difference between a structured decision and an unstructured decision?
One for which there is an understood and accepted method for making the decision

Unstructured decision process is one which there is no agreed-upon decision-making method. (ex - predicting how economy will be next year, or evaluating the performance of an employee
What is important to remember when dealing with structured and unstructured decision process terms.
Unstructured and structured is about the process, not the underlying subject.

Ex. Predicting the weather is a structured process, however the weather itself is an unpredictable phenomena
What are the 5 steps in decision making?
Intelligence gathering
Alternatives formulation
Explain what happens during the Intelligence gathering step?
What is to be decided?
What are the decision criteria?
Obtain relevant data
Explain the alternatives formulation step
Decision makers look at what the choices are
Explain the Choice step
Analyze the choices against the criteria using data
Select alternative
Explain the Implementation step
Implement the decision
Explain the review step
Evaluate results of decisions; if necessary repeat process to correct and adapt
What is the most important part of every information system?

The quality of your thinking is a large part of the quality of the information system. Although you can not increase your IQ, you can dramatically improve the quality of our thinking (you can't change the computer in your brain, but you can program it to think / work differently