How do internet and other information technologies support business processes within the business function of marketing and finance?

A Management Information System ICT Revision Questions and Answers

Answer
Marketing information systems integrate the information flow required many marketing activities. Marketing information systems provide information for:

Interactive Marketing:
The explosive growth of Internet technologies has had a major impact on the marketing function. The term interactive marketing has been coined to describe a type of marketing that is based on using the Internet, intranets, and extranets to establish two-way interaction between a business and its customers or potential customers. The goal of interactive marketing is to enable a company to profitably use those networks to attract and keep customers who will become partners with the business in creating, purchasing, and improving products and services.
• Customers are not passive participants, but are actively engaged in a network-enabled proactive and interactive process.
• Encourages customers to become involved in product development, delivery, and service issues.
• Enabled various Internet technologies, including chat and discussion groups, web forms and questionnaires, and e-mail correspondence.
• Expected outcomes are a rich mixture of vital marketing data, new product ideas, volume sales and strong customer relationships.

Targeted Marketing:
Targeted marketing has become an important tool in developing advertising and promotion strategies for a company‘s electronic commerce websites. Target marketing is an advertising and promotion management concept that includes five targeting components:
• Community – companies can customize their web advertising messages and promotion methods to appeal to people in specific communities. These can be communities of interest, such as virtual communities of online sporting enthusiasts or arts and crafts hobbyists, or geographic communities formed the websites of a city or local newspaper.
• Content – advertising such as electronic billboards or banners can be placed on various website pages, in addition to a company‘s home page. These messages reach the targeted audience.
• Context – advertising appears only in web pages that are relevant to the content of a product or service. So advertising is targeted only at people who are already looking for information about a subject matter that is related to a company‘s products.
• Demographic/Psychographic – marketing efforts can be aimed only at specific types or classes of people: unmarried, twenty-something, middle income, and male college graduates.
• Online Behavior – advertising and promotion efforts can be tailored to each visit to a site an individual. This strategy is based on ―web cookie‖ files recorded on the visitor‘s disk drive from previous visits. Cookie files enable a company to track a person‘s online behaviour at a website so marketing efforts can be instantly developed and targeted to that individual at each visit to their website.

Sales Force Automation:
Increasingly, computers and networks are providing the basis for sales force automation. In many companies, the sales force is being outfitted with notebook computers that connect them to Web browsers, and sales contact management software that connect them to marketing websites on the Internet, extranets, and their company intranets. Characteristics of sales force automation include:
• Increases the personal productivity of salespeople.
• Dramatically speeds up the capture and analysis of sales data from the field to marketing managers at company headquarters.
• Allows marketing and sales management to improve the delivery of information and the support they provide to their salespeople.
• Many companies view sales force automation as a way to gain a strategic advantage in sales productivity and marketing responsiveness.

For finance system
Computer-based financial management systems support financial managers in decisions concerning:

• The financing of a business.
• The allocation and control of financial resources within a business.

Major financial information system categories include:
• Cash and investment management.
• Capital budgeting
• Financial forecasting
• Financial planning

Cash Management:
Cash management systems collect information on all cash receipts and disbursements within a company on a real time or periodic basis. Cash management systems:
• Allow businesses to deposit or invest excess funds more quickly, and thus increase the income generated deposited or invested funds.
• Produce daily, weekly, or monthly forecasts of cash receipts or disbursements (cash flow forecast) that are used to spot future cash deficits or surpluses.
• Mathematical models frequently can determine optimal cash collection programs and determine alternative financing or investment strategies for dealing with forecasted cash deficits or surpluses.

Online Investment Management:
Many businesses invest their excess cash in short-term low-risk marketable securities or in higher return/higher risk alternatives, so that investment income may be earned until the funds are required. Portfolio of securities can be managed with the help of portfolio management software packages. Online investment management services:
• Are available from hundreds of online sources on the Internet and other networks.
• Help a financial manager make buying, selling, or holding decisions for each type of security so that an optimum mix of securities is developed that minimizes risk and maximizes investment income for the business.

Capital Budgeting:
The capital budgeting process involves evaluating the profitability and financial impact of proposed capital expenditures.
• Long term expenditure proposals for plants and equipment can be analyzed suing a variety of techniques. This application makes heavy use of spreadsheet models that incorporate present value analysis of expected cash flows and probability analysis of risk to determine the optimum mix of capital projects for a business.
Financial Forecasting and Planning:

A variety of financial forecasting packages provide analytical techniques that result in economic or financial forecasts of national and local economic conditions, wage levels, price levels, and interest rates.

Financial Planning systems use financial planning models to evaluate the present and projected financial performance of a business or of one of its divisions or subsidiaries. Financial planning systems:
• Help determine the financial needs of a business and analyze alternative methods of financing the business.
• Use financial forecasts concerning the economic situation, business operations, types of financing available, interest rates, and stock and bond prices to develop an optimal financing plan for the business.
• Frequently use electronic spreadsheet packages and DSS generators to build and manipulate models.



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