Information systems and its importance

Introduction (Executive Summary)

Information technology is one of the most important and unavoidable aspect off all medium to large organisations in the modern business world for their continued survival. Consider organisations like British Telecom, British gas, the water and power companies having to manually calculate, millions of utility bills every month. Hence the role of information technology is very important. Not only for the above mentioned organization but also all business organization is incomplete without the help of information technology. A recent article in the Daily Telegraph IT supplement suggested that many large companies could last no longer than 24 hours without information technology support! This shows the use of information technology in business and for the success of the company big companies are investing billions on its IT sectors. Development of information systems have changed over the years from a prototype approach to a professionally managed, planned, engineering approach. This report includes information systems requirements in each level of management, security and cloud computing and we are going to analyse the importance of Information Systems for Walmart and various information systems used in wal-mart.

Information requirements in different levels of Management

The information required differs according to different organizational levels. Accordingly the information can be classified as: operational information, managerial information and strategic information.

Top level / Administrative level Management

It consists of board of directors and managing director. The top management is the top most source of authority and it manages goals and policies of a company. They are responsible for planning and implementation of new strategies of the organization. For planning and for the formation of new policy they need information's this is provided by executive information system.

Executive Information Systems (EIS)

EIS is a type of management information system. It is used by higher authorities or top level managers, it help in providing data's which will help in planning and various steps of decision making. Graphical displays which give more clear idea about the various level of the organizations are generally used in EIS, this make the managers to analyse the data more easily and save time as well. It also help in comparing and highlighting the trends in important variable which help in monitoring performance of the company.

Middle level / Executory level Management

The middle level managers constitute of the branch manager and departmental managers mainly. They are responsible to the top management for the functioning of the department. The information required by the middle level managers are provided by managerial information system.

Management information system (MIS)

MIS is a planned system of the collecting, processing, storing, and assessing data in the form of information needed to carry out the functions of management at various levels. the information needed for middle level is for making short term decisions and plans for the company. Information's such as sales analysis and production details comes under MIS.

Decision Support Systems (DSS)

This is another information system used by middle level managers.DSS are a specific class of computerized information system that supports business and organizational decision making activities. The MIS and DSS together help the middle level managers for running the company more smoothly.

Lower level managers

This level is also termed as operational level of management. it comprises of supervisor, Forman, supervisor and section officers. They only require in formations such day-to-day operational activity, attendance of the employees etc. the IS used in lover level is transaction processing system.

Transaction Processing System (TPS)

Transaction processing system is a computer based group of logical operations, which will helps in collecting, modifying, storing and retrieving the data of an organisation. Transaction processing system allows all the operations to be grouped into a single transaction in order to prevent problems in consistency.

Walmart Enterprise's Information Systems

Walmart the retail giants based in United States is famous for the advanced Information Systems. Walmart has got the world's second powerful computer next to NASA. And the American Defence Systems even used Walmart logistics during the Iraq War. Everyone seems to argue that the biggest advantage of Walmart is the purchasing power of the company, but real competitive advantage of Walmart when compared to its competitors is the well developed Information Systems. Now we can have a close look at the Walmart information systems strategy.

Business-to-Consumer (B2C) Business Model:

The Walmart e-business model is identified as a Business-to-Consumer business model. It is possible for consumers to purchase the items through the Walmart website www.walmart.com, it is rated as one of the best website for among its group of competitors. Customers can order goods online and the Walmart delivery system will deliver goods to the customers in the agreed date & time. Walmart customers can also use the website to know about the current offers and special offers at any specific period. B2C involves customers gathering information, purchasing, and receiving products over an electronic network. Walmart enterprise mainly uses this type of e-commerce systems. Walmart developed their logistics and distribution channels in such a way to manage their inventories efficiently & making the right things available to the right store at the right time.

Extra techniques used by Walmart

Walmart is one of the world's largest and profitable retailers, this is achieved by their intelligent investment on the companies IT sector. Sam Walton was central to the legend. he build his empire on a belief in providing value for the customer and empowering employees, who are called as associates. According to the statistics in 1992 it has got 380,000 employees.

A decade ago Wal-Mart trailed K-Mart, which could negotiate lower wholesale prices due to its size. Part of Wal-Mart's strategy for catching up was a point of sale system, a computerized system that identifies each item sold, makes an accurate sales receipt for the customer, finds its price in a computerized database, and stores this item-by-item sales information for use in analyzing sales and reordering inventory. Beyond handling information efficiently, it could recognize the product which is been sold less, and hence it helped Walmart to avoid overstocking of the unwanted items. Over 5 year Walmart invested $600million in information systems. Wal-Mart used telecommunications to link directly from their stores to its central computer system and from that system to their supplier's computers. This allows automatic reordering and better coordination.

Information Systems Security used in Walmart

Leakage of information may lead to the company's failure. Hence all companies required to implement an effective security measure. The accesses of data should not be permitted to an outsider at any circumstances. The following are the security measures taken by Walmart. Internet security measures involve three layers: Perimeter security (access), Authentication, and Authorization.

Perimeter Security

The major motto of perimeter security is access control. It includes several tools such as Firewalls

A firewall is a group of systems that allow access-control policy between two networks. It is generally used as a barrier between a secure and unsecured internet networks. A successful firewall is designed with clear and specific rules about what can pass through. Several firewalls may exist in one information system.

Intrusion Detection Systems (IDS)

It restricts access to certain area. It is a network security device which monitors network system activities for malicious or unwanted behaviour. Hence by placing an IDS near the entrance of the internet to internet (near to firewall)

Virtual Private Networking (VPN)

They are base on encryption. It is type of computer network which is used other than software on top of an existing larger network. VPNs should never be used by computers without active updated firewalls installed.

Authentication

This helps in the avoiding unauthorized access attempts. Companies use an access protection strategy that needs a authorized users to dial in with a preassigned PIN. This strategy is generally protected by a unique and frequently changing password.

Authorization

This is a permission given to individuals or a group to perform certain activities with a computer, generally bases on an identity. The security system, once it authenticates the user, must make sure that the user operates within his authorized activities. Hence by using this it is possible to block unauthorized users.

Information Systems & Physical Security:

Physical security breach with an organisation can also lead to the leakage of the information systems. There should be enough security measures in place so that no stranger could get in to the office and access the critical information regarding the business.

Cloud Computing

Cloud computing is a general term for anything that involves delivering hosted services over the Internet. The goal of cloud computing is to provide easy, scalable access to computing resources and IT services.

Cloud computing is a general term for anything that involves delivering hosted services over the Internet. These services are broadly divided into three categories: Infrastructure-as-a-Service (IaaS), Platform-as-a-Service (PaaS) and Software-as-a-Service (SaaS). The name cloud computing was inspired by the cloud symbol that's often used to represent the Internet in flow charts and diagrams.

A cloud can be private or public. A public cloud sells services to anyone on the Internet. (Currently, Amazon Web Services is the largest public cloud provider.) A private cloud is a proprietary network or a data centre that supplies hosted services to a limited number of people. Walmart presently has no cloud computing facilities.

Conclusion

To conclude it is understood by taking Walmart as an example that the strength of organization depend up on the information technology used by the firm, more advanced and appropriate information systems will add up the organizations good will and productivity. Using appropriate security systems are more important for organizations information and organizations success.

Bibliography

References

Books:

  1. Turban, Leidner, Mclean and Wetherbe, Information Technology for Management 6th Edition
  2. Gerald Karush & Masood Samii, International Business and Information Technology.
  3. John.G.Burch & gary Grudnitski, Information System: Theory & Practice.
  4. Graham Curtis & David Cobham, Business Information Systems: analysis, design & practice
  5. Robert.D.Galliers, Dorothy.E.Leinder, Strategic Information Management 4thEdition.
  6. George Reynolds, Ethics in Information Technology (2003).

Web Sites

  • http://www.comp.glam.ac.uk/
  • http://www.bukisa.com/articles/20243_the-importance-of-information-system
  • http://www.answers.com/topic/information-systems
  • http://www.prenhall.com/divisions/bp/app/alter/student/useful/ch1walmart.html
  • http://fscavo.blogspot.com/2006/04/inside-peek-at-wal-marts-it-systems.html
  • http://www.comp.glam.ac.uk/pages/staff/tdhutchings/chapter1.html
  • http://www.scribd.com/doc/11796980/Information-Systems-at-Walmart-Inc

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