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24 Cards in this Set
- Front
- Back
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5 Functions of an Organization
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Manufacturing and production
Sales and marketing Human resources Finance and accounting Operations |
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Business Process Defined
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“an interrelated, sequential set of activities and tasks that turns inputs into outputs, and includes the following: (1) a beginning and end; (2) inputs and outputs; (3) a set of tasks (subprocesses) that transform the inputs into outputs; and (4) a set of metrics for measuring effectiveness” (Pearlson and Saunders 2006, p. 112)
Most often involves multiple functional areas |
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Business Process Perspective
This requires… |
This requires…
A manager to consider the whole rather than focusing only on their piece of the process enabled through… A defined set of outputs measured through metrics and often results in… Employee sense of ownership and accountability for the entire process |
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Communications
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A marketing employee within The Media Company observes a system metric where customers that experience an initial declined payment frequently report dissatisfaction with product delivery time.
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Coordination
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Spurred by this information, members from the accounts receivable, inventory management, and information technology groups meet to evaluate potential causes of the lag. An investigation of the process reveals a flaw in the on-line payment screen that allows customers to submit their order without requiring the selection of a credit card type. The information technology group is then able to use this information to correct the on-line payment system.
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Collaboration
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Using their discussions from earlier meetings as a springboard, employees from several departments collaborate to determine other ways in which the lag between payment processing and product retrieval activities can be reduced to improve overall customer satisfaction. Their discussions reveal that all on-line purchases currently require an individual within the accounts receivable group to manually approve the purchase before it can be passed to the inventory management group.
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Flexibility
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Based on input from these different groups, the business process is modified so that system-approved credit card purchases will automatically route to the inventory management group in order for product retrieval to proceed immediately.
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The information process
(Logical Components of a Business Process) |
Addresses the flow of information within the organization
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The operations process
(Logical Components of a Business Process) |
Includes individuals, equipment and procedures that are procedurally involved in the ongoing operations related to the business process
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The management process
(Logical Components of a Business Process) |
Composed of individuals, policies and procedures that coordinate and oversee the operational aspects of a business process
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Determining Information Quality
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Understandability
Relevance Timeliness Verifiability Neutrality Reliability |
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Marketing & Sales Process
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Focused on informing customers of product or service offerings, processing orders, managing inventory, and shipping products to customers
Examples of operational activities include: Taking customer orders Evaluating a customer’s credit limit Checking inventory levels Preparing an order for shipment |
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Revenue Collection Process
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Focused on billing customers and maintaining accounts receivable
Examples of operational activities include: Mailing paper invoices Notification of customers with overdue accounts Updating customer records when payment has been received Resolving delinquent accounts |
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Expenditure Management Process
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Focused on the organization’s procurement, or purchase and payment for services rendered and/or goods received
Examples of operational activities include: Monitoring product inventory Generating purchase orders Issuing payment to vendors |
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Production Process
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Focused on the organization’s design and manufacture of products or services
Examples of operational activities include: Manufacture oriented: New product design Documentation of the production schedule Manufacturing of a product Service oriented: New service design Modification of existing services Implementation of a new or modified service |
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Human Resources Process
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Focused on employee activities relating to recruitment, hiring, training, job assignment, compensation, performance evaluation, and discharge
Examples of operational activities include: Advertising job openings Training employees on corporate policies Specifying compensation criteria for corporate employees Conducting exit interviews for terminated employees |
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G/L & Business Reporting Process
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Focused on processing and communicating information to internal and external stakeholders
Examples of operational activities include: Compiling a financial budget Generating a financial statement Enabling ad hoc reports for management |
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Transaction Processing System (TPS)
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Purpose: processes business events and transactions
Characteristics include: Efficiently processes transaction data Ensures data accuracy and integrity Enables flexible reporting Increases operational efficiencies Improves customer service and loyalty |
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Management Information System (MIS)
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Purpose: supports the informational needs of management required to steer the activities of an organization, functional area, or subgroup within the organization
Characteristics include: Ability to forecast Given a set of criteria, able to generate optimal values Ability to provide secure, ad hoc reporting capabilities |
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Executive Information System (EIS)
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purpose: supports the activities of senior management, and as such must allow for unstructured and non-routine analysis required in strategic planning activities
Characteristics include: Learns from past experience and applies learnings to new situations Analyzes highly complex and unstructured situations Solves problems with minimal information Prioritizes issues Uses heuristics |
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Continuous Improvement
(Identifying & Enacting Change) |
Attempt to continuously search for ways in which existing processes can be improved
Frequently implemented through Total Quality Management (TQM) programs Advantages Often more palatable to employees Disadvantages Doesn’t fix major process problems |
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Business Process Reengineering
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“a systematic, structured improvement approach by all or part of an organization whereby people critically examine, rethink, and redesign business processes in order to achieve dramatic improvements in one or more performance measures such as quality, cycle time or cost” (Jessup and Valacich 2006, p. 262)
Advantages Can address major process problems Disadvantages Often takes a long time to realize benefits Radical change can alienate employees |
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Restructuring (outsourcing)
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“the contracting of a specific business task, such as payroll, to a third-party service provider” (Haag, et al. 2006, p. 160)
Often discussed as “off-shoring” Advantages Allows organization to focus on their core competencies Disadvantages Organization diminishes their control of the business process and becomes reliant on an external party |
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Restructuring (downsizing)
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Often the result of enacting change in an organization
Advantages Can increase operational efficiencies Disadvantages Can produce moral issues for retained employees Not easily reversible |
