Management Information System in Logistics Industry

Introduction Management information system gives emphasis to the collection, organization, analysis and distribution of information for the planning and control of business and organizational operations. Within every organization, management is required to bring together the data gathered through its functional activities and to analyze that data to help management decision making. The data obtained can come from a range of resources ( and 2004, ). Different Management Information Systems 1. Electronic Data Interchange Systems (EDI) Electronic data interchange systems represents the exchange of documents and transactions by a computer in one company with the computer(s) of one or more other companies in an open-system environment. The application of EDI involves the conversion of a written document into a machine-readable form so that a computer in one company can communicate directly with the computer of the other company ( 1999, ). 2. Decision Support Systems (DSS) Essentially, an individually oriented decision support system is designed to satisfy the needs of a manager at any level in a distributed data processing environment. The

system is designed to support the problem-finding and problem-solving decisions of the manager. Such a system emphasizes direct support for the manager in order to enhance the professional judgment required to make decisions, especially when the problem structures tend to be semi structured and unstructured ( 1999, ). 3. Executive Information Systems (EIS) EIS is used mostly for highly structured reporting, sometimes referred to as status access. DSS has become almost synonymous with modeling and unstructured, ad hoc querying. Executive information systems are aimed at senior executives who currently have few, if any, computer-based systems to assist them in their day-to-day responsibilities. EIS brings together relevant data from various internal and external sources, delivering important information quickly and in a useful way. More important, it filters, compresses, and tracks critical data as determined by each executive end user. EIS performs the conceptually simple task of informing senior executives on matters relevant to their organizational responsibilities. Unlike traditional MIS functions that focus on the storage of large amounts of information, EIS focuses on the retrieval of specific information and on status access. The emphasis is on reducing the time and effort that the executive user must expend to obtain useful information for making the organization more competitive and its employees more productive. An executive information system can be defined in its broadest sense as one that deals with all of the information that helps an executive make strategic and competitive decisions, keeps track of the overall business and its functional units, and cuts down on the time spent on routine tasks performed by an executive. As such, an EIS is capable of

providing an executive with the right information in the right format, fast enough to enable the individual to make the right decisions ( 1999, ). 4. Idea Processing Systems Idea Processing Systems are systems designed to capture, evaluate, and synthesize individual ideas into large context that has real meaning for decision makers. The basic stages of an idea processing system center on inputs in the form of a problem statement and an observation about the problem. Processing involves idea generation and evaluation of ideas for solving the problem ( 1999, ).

Literature Review Management information system is a centralized and usually computerized information system used by the managers of an organization in making decisions ( 2004, ). According to (1999), a management information system is an information system designed to provide financial and quantitative information to all the levels of a management in an organization. Most modern management information systems provide the data from an integrated computer database, which is constantly updated from all areas of the organization in a structural way. Access to the data is usually restricted to the areas regarded as useful to particular managers; access to confidential information is limited to top management ().

According to (2000), in evaluating the management information system, attention is typically directed to the integration of 1. Planning and scheduling 2. Quality control 3. Materials management 4. Production processes 5. Inspection and test 6. Inventory control 7. Level of purchased material () Integrated information system is a system designed to evaluate the activities of the organization. it is designed within a framework that emphasizes profit planning, performance planning, and control at all levels. It contemplates the ultimate integration of required business information subsystems, both financial and non-financial, within the organization. Formerly the primary interest of business information systems was developing financial statements. When an integrated management information system is installed, its major purpose is the production of reports that will assist management. A management information system involves more than a mechanical linking together of various organizational functions. Going one-step further, it aids management by taking over routine decision-making. A management information system is a network of related

subsystems, integrated to perform the functional activities of an organization ( 1978, ). In modern logistics, information technology plays a vital role. Highly integrated systems across internal and external supply chains are vital (, 2000). The logistics industry services range along a continuum through general haulage, storage, inventory management, integrated distribution and logistics management associated with increasing profitability ( and 2004, ). While the past has seen a great accent on managing data, information, and knowledge, today the accent has moved to helping a typical company be more effective by optimizing its operations through a better understanding of what is happening on a day-to-day basis. More specifically, this takes the form of interconnected E-commerce with customers and suppliers that stretch beyond the boundaries of the organization. with the click of a mouse, various types of agents, including smart agents, are capable of accessing critical, timely information, knowledge, and intelligence needed for optimizing a companys operations. Tapping into data services provided by logistics partners, decision makers are able to realize optimum supply chain strategies. And linked to collaborative computing platforms, a smart business systems approach enables decision makers to search for others within and outside the organization who are engaged in related activities ( and 2003 ).

Management Information Systems in Logistics Industry Scientific and technological advancements and the boom of the world economy have propelled the emergence of logistics as an industry. Logistics is now considered as a new economic sector all around the world. Logistics activities such as planning,

implementing, and controlling the flow of goods, are vital to modern industrial enterprises. The provision of logistics services organizing and managing the flow of goods through the supply chain is now an industry in its right. The logistics industry is now seen as an important element of a nations economy. The level of development of the logistics service is one of the most important indices of a nations level of industrialization and its overall competitiveness. Logistics is regarded as a medium for the development of an economy. One of the ways to support the growth of the logistics industry is through information systems. The industry will benefit if logistics information systems will be used. Logistics companies should adopt advanced technology like ERP to improve the quality of management. This would help logistics companies communicate and share information and encourage them to use Internet technology. The use of management information systems like ERP (Enterprise Resource Planning Software) will eventually foster the development of information platforms and make possible the efficient communication of information ().

Information Systems in Logistics Industry ERP (Enterprise Resource Planning) ERP software suites are business applications that integrate processes across the enterprise and link them to a common data repository. ERP provides greater access to accurate information, raising the visibility of the business results across organizational boundaries. ERPs are being used now by companies to upgrade software to leverage the

Internet and employ product extensions for greater business intelligence. Increased focus on more effective business management and accurate financial reporting has driven the use of ERP. ERP systems integrate data from the core operational areas and make them available for dissemination across the enterprise. The accessibility to reliable data from across the enterprise exposes bottlenecks or weaknesses in the supply chain while speeding the time to solution. Visibility of information supports rapid decision-making, better operational control, and streamlining of processes leading to reduced costs (, 2006).

ERP for Small and Medium Size Enterprise Logistics is an industry that is composed of thousands of enterprises, which are highly interdependent. Cooperation and coordination among those logistics parties are very intricate and broad. To achieve an effective logistics chain management, all the stakeholders must be highly integrated. This can only be achieved through an integrated information platform that results in the usage of a uniformed information system such as the Enterprise Resource Planning. ERP can be a good investment for logistics companies that will benefit them in the long run. However, introduction and implementation of the ERP system can also be challenging. The selection of appropriate software can be difficult. The management needs to fully understand their own business processes enough to know which specific functional requirements to seek in the software. The focus should be on what the software could do to help achieve more effective business processes. The

software must match the organizations business processes. This can be achieved through accepting the package and make changes in its business or customizing the software.

Critical Analysis Management information systems used the computer as a means of providing information to solve recurring operational problems. There is a need for a better approach that will position the decision makers at the center of the decision- making process ( and 1999, ). One of the hindrances to the alignment of logistics chain is the data exchange. Enterprises use their own MIS system for storing data and functions management. Varying methods of data exchange and archive among enterprises leads to incompatibility and possible misinterpretation and eventually to errors. Moreover, an enterprise may have its effective enterprise management system. Alignment of logistics chain would be complicated by their dissimilarities. Failure to integrate the logistics chain can result to cost and time inefficiencies. Advantages of ERP Systems (. 2002, ) Benefits Reliability in accessing information Reduced data and operations redundancy Decreased delivery and cycle time Cost Reduction How reports,

Improvements

of

consistent

and

accurate data Data are accessed from the database, updates operations and avoids multiple data input Minimizes retrieving and reporting delays Time savings, improvements in control through company-wide analysis of organizational

Easy Adaptability Improved scalability Improved maintenance Global Outreach

decisions Easily adapts to the changes in the processes of the business Prearranged design with add-ons Vendor supported Extended modules

Disadvantages of ERP Systems ( 2002, )

Disadvantages Time-consuming Expensive Vendor dependence

Solutions Minimize sensitive issues, internal politics and raise general consensus Cost may vary. Business process

reengineering cost is more costly Single vendor vs. multi-vendor consideration, long-term committed support

Conclusion The logistics industry is rapidly growing. Logistics as an industry is seen as a key to economic growth and development. The growth of logistics industry can also benefit other industries such as logistics facility manufacturing and Internet-based e-commerce. A strong logistics industry can benefit the economy because it can attract foreign investors and enterprises. The use of information systems such ERP and MRP and provision of platforms for industrys development is essential to support its growth.

Information systems allow enterprises to share and exchange information. Information system help the management in the decision making process and allows efficient communication of information. Management information systems improve business insight by supporting calculated decision-making process through better access to information. Information systems allow the management to access information that can help in effective and efficient decision-making.

For DELL: http://e-learning.dmst.aueb.gr/mis/Cases/Dell/index.htm <<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<< REF: http://ivythesis.typepad.com/term_paper_topics/2008/01/the-current-man.html

The Current Management Information System of Dell Company

Contents 1. Executive Summary 2. Main Body of the Report 2.1.1. Management Information System 2.1.2. Dell Computer Corporation 2.1.3. Information processing tools for operational, tactical and strategic levels of the organization 2.1.4. Inventory control systems in an organization

3. Conclusion 4. Recommendation 5. References Executive Summary This report will review management information system of Dell. After reviewing the MIS of Dell, the report will discuss information processing then suggest the appropriate information processing tools for operational, tactical and strategic levels of the organization. The report will also include inventory control systems in an organization and why it is important for the company to make the inventory systems updated. Management Information System Management information system involves the information system and the organization. MIS begins where computer science ends. Computer scientists deserve accolades for developing and delivering even more advanced forms of information technology: hardware technology; software technology; and network technology. Yet because no technology implements itself, there is more to MIS than just information technology. MIS has dimensions. The four interrelated dimensions of MIS are as follows: First, MIS involves not just information technology, but also its instantiation; second, MIS involves, as reactive and inextricable elements, both an information system and its organizational context; third, MIS involves information technology as a form of intellectual technology;

and fourth, MIS involves the activities of a profession or corporate function which are integral to the essence of what MIS is (Currie & Galliers, 1999). Dell Computer Corporation Company Background Dell Computer Corporation is a major manufacturer of personal

computers, computer peripherals, and software. Among the leading producers of computers in the world, Dell sells its products directly to customers through the Internet and mail-order catalogs rather than through retail outlets. The company is based in Round Rock, Texas. At Dell Computers, customers are brought into the product planning and manufacturing processes, with all employees encouraged having contact with customers. Through effective collaboration across boundaries, ideas can be shared about product designs and value propositions. The result is faster and more customer-focused product and service innovation. To produce the capacity for this, considerable attention must be placed on organizational structures, processes, skills and culture. Such elements may need a radical overhaul in established companies (Dennis & Harris, 2002). Dell was founded in 1984 by Michael Dell. In 1983, during his freshman year at the University of Texas, he bought excess inventory of RAM chips and disk drives for IBM personal computers from local dealers. He resold the components through newspaper advertisements at prices far below retail cost. By 1984, his sales totaled about $80,000 a month. In April 1984, Dell dropped out of school to launch his company (Ford, Honeycutt, & Simintiras, 2003).

The new company soon began manufacturing its own IBM-compatible computers under the name PCs Limited. Because Dell sold computers directly to users through advertisements in magazines and catalogs, the company could price its machines lower than those sold through retail stores. Sales reached nearly $6 million during the companys first year, climbing to $34 million the following year. By 1987, Dell was the leading mail-order computer company in the United States. In that year, it created a sales force to target large corporations and began adding international offices to capture the direct-mail market outside the United States (Ford, Honeycutt, & Simintiras, 2003). While the company continued to grow rapidly; Dell experienced a series of setbacks that hurt profits. In 1990, the company began selling computers through retail stores, an effort it abandoned in 1994. In 1991, Dell launched a line of notebook computers, but quality problems and inadequate production planning forced the company to stop selling for a year. In 1994, Dell launched a new line of notebook computers and expanded efforts to increase overseas sales. Dell also began focusing on the market for servers, which used the computers to run local area networks. By the late 1990s, Dell was firmly in place as the worlds number one direct seller of computers. More than 50 percent of the companys computer sales transactions took place via its website, which generated worldwide sales in excess of $40 million a day (Ford, Honeycutt, & Simintiras, 2003). Information Processing Tools

Information or Data processing is the analysis and organization of data. It is used extensively in business, engineering, and science and an increasing extent in nearly all areas in which computers are used. Businesses use data processing for such tasks as payroll preparation, accounting, record keeping, inventory control, sales analysis, and the processing of bank and credit card account statements. Engineers and scientists use data processing for a wide variety of applications, including the processing of seismic data for oil and mineral exploration, the analysis of new product designs, the processing of satellite imagery, and the analysis of data from scientific experiments (Thierauf, 1978). Data processing is used extensively in business, engineering, and science and to an increasing extent in nearly all areas in which computers are used. Data processing is divided into two kinds of processing: database processing and transaction processing. A database is a collection of common records that can be searched, accessed, and modified, such as bank account records, school transcripts, and income tax data. In database processing, a computerized database is used as the central source of reference data for the computations. Transaction processing refers to interaction between two computers in which one computer initiates a transaction and another computer provides the first with the data or computation required for that function. Most modern data processing uses one or more databases at one or more central sites (Thierauf, 1978).

Transaction processing is used to access and update the databases when users need to immediately view or add information; other data processing programs are used at regular intervals to provide summary reports of activity and database status. Examples of systems that involve all of these functions are automated teller machines, credit sales terminals, and airline reservation systems (Thierauf, 1978). The information processing tools that Dell uses include computers, the internet, maps, spreadsheets, models, and databases. For the operational level of Dell, the most appropriate tool for information processing is maps. Through the said information processing tool, decisions on how to operate the organization can be initialized and made. Maps can be used to determine which country/place information will be acquired from, it can also assist in determining the demographic level of people and information will be gathered . Maps can be in the form of charts that can also provide necessary information. The information gathered in turn can assist in helping to decide how an organization will be operated. For the tactical level of Dell, the most appropriate tool for information processing is databases. Through the said information processing tool, the records that can assist in finding out the strength and weakness of the company can be used to determine the tactic that will be used by the organization. For the strategic level of Dell, the most appropriate information processing tool is the internet or World Wide Web. Through the internet, trends and strategies by other companies can be known. After analyzing the trends and strategies used by

other companies, an appropriate strategy can be formulated to use by the organization. Inventory control systems Individual businesses need, first and foremost, an efficient inventory control system. This implies the minimum amount of inventory that will provide the consumers with what they need whenever and wherever they need it. Effectiveness of the inventory system means basically having an inventory mix that is most likely successful in satisfying consumer needs (Samli & Sirgy, 1995). The inventory control systems used by Dell is up to date and reliable to prevent problems to arise. The inventory system of Dell makes sure that anything the consumer need will be available to them at any given time. It is also what the company uses to know if certain products are still available or misuse of the inventory system may cost problems to the company. Conclusion Management information system involves the information system and the organization. Dell benefits a lot from the management information system. The system helps the company create strategies that will help the company conquer any problems and threats from competitors. The system also assists the company in processing the needed information. Management Information Systems also helps a company to create or update its inventory control system. Recommendations

Since the MIS of a company is a vital part of its operations and its survival in the modern world, it must be well updated and it must compete well with MISs competitors. The MIS of a company should be created from high standards so that it can be of stiff competition against its counterparts. The MIS system should help the company to achieve its goals and assist the company in reaching its potential.