Management information systems revision question and answer

CPA-Quantitative-Analysis-Section-4 BLOCK RELEASE

The electronic business (c-business) field is an emerging concept that seems to be revolutionizing the business world yet many companies have failed to exploit the opportunities of e-business with their customers and suppliers.

Required:
(i) Name and explain four opportunities e-business may offer to both companies and their. customers

(ii) Examine two challenges that may hinder a company’s attempt to implement the c- business concept.
b) What are the four main applications of a database system in a customer department’?

(C) Most information systems are reviewed or critically examined a few months after they have been implemented or put into operation.

Required:
State key reports resulting from this exercise outlining their structural content.
ANSWER
a) Electronic business
This is the use of the Internet and other digital technology for organizational communication and coordination and the management of the firm. Intranets are quickly becoming the technology of choice for electronic business.

Opportunities offered:
1. Cost Reduction
Intranets provide an opportunity for reduction of costs associated with handling and storing information. Since the information is stored electronically, there is minimal need for paper-based systems which involve paper, printing and distribution costs.
2. Training Of Organizational Staff
Internet and intranet networks enable organizations to train their staff effectively. Training could be through audio-visual programs contained in a company‘s intranet or through videoconferencing (ability to confer with a group of people simultaneously using telephone or e-mail group communication software)
3. Improved Group Collaboration
This is due to better intra-organizational communication facilitated Internet and intranet technologies such as e-mail.
4. Up-To-Date Online Information Repositories
Product catalogs, employee handbooks, telephone directories or employee benefits information could be stored online in a company‘s intranet and could be revised immediately as any changes occur. This approach enables organizations to respond more rapidly to changing conditions.
5. Production Control
Intranets could be used to deliver financial information to manufacturing personnel so that workers can monitor the production line‘s profit-and-loss performance and adapt accordingly. The intranet can also be used to provide quality measurements such as defects and rejects as well as maintenance and training schedules.
6. Improved Customer Service
Up-to-date organizational information, improved group working and production control has the overall effect of improving the quality of goods and services offered to consumers.

Challenges:
1. Cost Of Changing To E-Business
Since e-business requires the use of the Internet and related digital technologies, a company intending to implement e-business would have to consider internet connection costs, costs associated with setting up and maintaining an intranet, etc. Such costs have to be clearly justified the potential benefits to be delivered.
2. Security And Privacy
Connecting to the Internet or setting up an intranet for e-business would imply that adequate security checks have to be put in place to protect the organization‘s data.
3. Business Process Change Requirements
Setting up an intranet to provide access to shared organizational data would imply that the document flow of the organization would have to be modified to take into account the central shared repository of data.
4. Employee Resistance To Change
This could delay implementation of the e-business project since resistance has to be addressed before implementation.

b) Applications:
1. Storing customer records.
2. Updating customer records.
3. Producing reports e.g. a report of customers with outstanding balances.
4. Adding new customers to the database.
5. Deleting deceased customers from the database.

c) Reports resulting from information system reviews:
1. Performance evaluation reports- compares the predicted and actual performance of the new system and outlines whether the new system is meeting user requirements.
2. Staffing reports- this outlines whether staff needs are being met.

3. Security evaluation report- contains information on the effectiveness of the security procedures of the system.
4. Error evaluation report- contains information on how the system is operating, on the input errors and errors in the system outputs.

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