CHAPTER 1

1. Why Is Introduction to MIS the Most Important Class in the Business School?
The surge in internet access globally, an exponential growth in data production, and a shift
towards mobile platforms. These technological advancements are reshaping businesses, offering
new opportunities for customer engagement and operational efficiency. As a result, IT has
become a crucial factor in today's business landscape, making the study of Information Systems
more important than ever.
Relevance of Information Technology: In today's business environment, the ability to assess,
evaluate, and apply emerging information technology is crucial. As businesses increasingly rely
on technology, understanding how to leverage these tools becomes essential for future
professionals.
Development of Marketable Skills: The course equips students with valuable skills such as
abstract reasoning, systems thinking, collaboration, and experimentation. These skills are not
only applicable to MIS but are also highly sought after in various business roles, providing a
level of job security.
Foundation for Business Success: Knowledge of information systems is critical across all
business disciplines, whether in accounting, marketing, or management. The course lays the
groundwork for understanding how technology is integrated into business processes, which is
vital for success in any business career.
Adaptation to a High-Tech Environment: As the business landscape evolves with technology,
being proficient in understanding and using technology is akin to being fluent in a language. This
course prepares students to navigate and thrive in a high-tech business environment.

2. How to attain Job Security?

- Abstract Reasoning: the skill of creating and working with simplified models of real-
world concepts. It’s about looking beyond the details of an object or situation to understand its
underlying patterns or principles. For example, think about how a doctor uses X-rays to
understand what's happening inside your body. That X-ray is a simplified representation of your
bones and organs, making it easier to diagnose a problem.
- System Thinking: how different parts of a system work together as a whole. It involves
recognizing how each component influences the others and how their interactions create a
particular outcome. imagine a city's traffic system. It's made up of cars, roads, traffic lights, and
drivers. By understanding how these elements interact with each other, we can identify potential
problems, like traffic jams, and find solutions to improve the overall system.
- Collaboration: Collaboration refers to the process of working together with one or more
individuals or groups to achieve a common goal or complete a task. It involves sharing
knowledge, skills, and resources to produce a collective outcome that is often more effective than
what could be achieved individually.
Example: team of software engineers is working on a new mobile app. Instead of each developer
working in isolation, they collaborate closely. They might:
 Brainstorm ideas together: They discuss the app's features, user experience, and technical
challenges.
 Divide tasks: They break down the project into smaller, manageable tasks, assigning
them to different team members based on their skills and expertise.
 Share knowledge and resources: They use version control systems to share code, provide
feedback on each other's work, and learn from each other's experiences.
 Regularly communicate: They hold daily stand-up meetings to discuss progress, identify
any roadblocks, and coordinate their efforts.
 By working together collaboratively, the team can produce a higher-quality app more
efficiently than if each developer worked independently.
- Ability to experiment: the capacity to test new ideas, approaches, or solutions in a
systematic and thoughtful manner. It involves a willingness to explore possibilities, learn from
outcomes, and adapt based on findings.

3. What is MIS?
MIS is essentially about using technology and data to make businesses run smoother and achieve
their goals. It's like having a powerful tool that helps you organize tasks, make informed
decisions, and ultimately, succeed.
- Processes, Information Systems, and Information: These are the building blocks.
Processes are the steps involved in getting things done, like how a restaurant takes orders, cooks
food, and delivers it. Information systems are the tools that help with these processes, such as the
point-of-sale system and kitchen display system. Information is the data that flows through these
systems, like customer orders and ingredient inventory.
- Management and Use: It's not just about having the tools; it's about knowing how to use
them effectively. Just like a skilled chef knows how to use a knife to chop vegetables, a good
manager knows how to use information systems to improve operations.
- Achieve Strategies: The goal is to use MIS to help the business reach its objectives. MIS
should be aligned with the business's overall aims and assist in decision-making that leads to
success. If a restaurant wants to increase profits, MIS can help them identify slow-selling items,
optimize staffing, and improve customer satisfaction.

4. How does MIS related to Organizational Strategy?

- Support for Strategic Goals: MIS exists to help organizations achieve their strategic
objectives. By providing timely and relevant information, MIS enables decision-makers to align
their actions with the organization's goals and strategies. This alignment ensures that resources
are allocated effectively to support strategic initiatives.
- Influence of Competitive Strategy: An organization’s competitive strategy determines
its goals and objectives, which in turn shape the structure and functionality of its information
systems. MIS must be designed to support the specific needs of the organization’s strategy,
whether that involves cost leadership, differentiation, or focus strategies.
- Integration of Business Processes: MIS facilitates the integration of various business
processes, which is essential for executing organizational strategy. By streamlining processes
and improving communication across departments, MIS helps ensure that all parts of the
organization work together towards common strategic goals.
- Adaptation to Market Changes: The dynamic nature of business environments requires
organizations to be agile and responsive. MIS provides the data and insights necessary for
organizations to adapt their strategies based on market trends, customer feedback, and
competitive pressures. This adaptability is crucial for maintaining a competitive edge.
- Data-Driven Decision Making: MIS enables organizations to make informed decisions
based on data analysis and reporting. By leveraging data analytics, organizations can evaluate the
effectiveness of their strategies, identify areas for improvement, and make strategic adjustments
as needed
The flowchart illustrates how MIS is connected to various aspects of an organization's
strategy:

1. Industry Structure: The industry in which the organization operates influences its
strategic options. MIS can help analyze industry trends, competitor activities, and customer
preferences to inform strategic decisions.

- Threat of substitutions: the risk that customers may switch to alternative products or
services that perform similar functions or fulfill similar needs. A high threat of substitution can
limit an industry's potential profitability, as customers have more choices and may choose
cheaper or more convenient alternatives. EX: The traditional cable TV industry has faced a
significant threat of substitution from streaming services like Netflix, Hulu, and Amazon Prime
Video. These services offer a more flexible, on-demand viewing experience at a lower cost.
- Threat of new entrants: used to analyze an industry's competitive environment. This
force assesses how easy or difficult it is for new companies to enter the industry and compete
with established businesses, potentially eroding the market share and profitability of existing
players. EX: In the early days of the smartphone industry, the threat of new entrants was
relatively low due to high barriers to entry. Companies needed significant resources to develop
advanced hardware, software, and a strong distribution network. However, as technology
advanced and consumer demand increased, the barriers to entry began to erode. Chinese
smartphone manufacturers like Xiaomi, Huawei, and Oppo emerged as powerful competitors,
challenging the dominance of established players like Apple and Samsung.
- Existing rivals: the intensity of competition among existing firms in an industry. This
rivalry can manifest in various ways, including price wars, advertising battles, product
introductions, and other competitive strategies aimed at gaining market share. EX: Companies
like Apple, Samsung, and Google constantly battle for market share through: Introducing new
features, designs, and software updates to attract consumers. Investing heavily in advertising and
branding to build brand loyalty. Collaborating with other companies to offer exclusive features
and services. Offering competitive pricing and discounts to entice customers.
- Bargaining power of suppliers: the influence that suppliers can exert on the companies
in an industry by raising prices, reducing quality, or limiting the availability of goods and
services because of the shortage, uniqueness of products or serivce offered. EX: In the
automotive industry, suppliers of critical components like semiconductors and batteries often
have significant bargaining power. A few large suppliers dominate the market for certain
components. It can be costly for automakers to switch suppliers, as it involves redesigning
products and retooling production lines. Some suppliers offer specialized components that are
difficult to source from alternative suppliers.
- Bargaining power of customers: the influence that customers have on a business in
terms of pricing, quality, and other elements. When customers have strong bargaining power,
they can pressure companies to reduce prices, improve product quality, or offer better service.
EX: In the retail industry, large retailers like Walmart and Target often have significant
bargaining power over their suppliers. Due to their large purchasing volumes, they can negotiate
lower prices from suppliers. They can impose strict delivery deadlines and quality standards on
suppliers. They can easily switch suppliers if they are not satisfied with the terms or quality of
products.
2. Competitive Strategy: An organization's competitive strategy defines how it will
compete in the market. MIS supports this strategy by providing data and insights to assess
competitive advantages, identify opportunities, and make informed decisions.

Porter's Four Competitive Strategies, developed by Michael Porter, are frameworks businesses
use to gain a competitive advantage in their markets. The four strategies are:

- Cost Leadership: This strategy aims at becoming the lowest-cost producer in an

industry. Companies using this approach focus on reducing production and operational costs,
allowing them to offer products at lower prices than competitors, thereby attracting a broad
customer base. EX: Walmart has consistently focused on cost reduction through efficient supply
chain management, bulk purchasing, and operational excellence. This allows them to offer lower
prices to customers, attracting a large customer base.
- Differentiation: Here, companies aim to offer unique products or services that stand out
from competitors. They focus on creating something perceived as superior in quality, design,
brand reputation, or innovation. This strategy typically allows businesses to charge premium
prices. EX: Apple differentiates itself through innovative product design, superior user
experience, and strong brand image. Their products, such as iPhones and MacBooks, are often
perceived as premium and command higher prices.
- Cost Focus: This strategy narrows the cost leadership approach to a specific market
segment. Businesses targeting a niche aim to be the lowest-cost producers within that segment,
not necessarily in the entire industry. For instance, a small grocery chain might focus on
providing budget-friendly products to a particular local market.
- Differentiation Focus: Similar to differentiation, but targeting a specific, smaller market
segment. Companies using this strategy aim to offer unique features or high-quality products
within a niche market. For example, luxury watch brands focus on a high-end customers.

3. Value Chains: Value chains map the activities that create value for customers. MIS
optimizes these activities by streamlining processes, improving efficiency, and enabling
collaboration.
4. Business Processes: Business processes are the specific tasks and workflows that
organizations use to achieve their goals. MIS automates and integrates these processes,
improving productivity and reducing errors.

1. Member Request: A member submits a request to attend a class.

2. Check Membership Status: The desk clerk verifies the member's membership status.
3. Check Class Availability: If the member is active, the clerk checks if there are available seats
in the desired class.
4. Decision Point: If there are available seats, the member is added to the class roster. If the
class is full, the member is not added.
5. Schedule Class Process: Once a member is added to a class, the class is scheduled.
6. Solicit Memberships Process: The fitness center actively seeks new members to fill classes
and generate revenue.
5. Information Systems: Information systems are the specific tools and applications that an
organization uses to manage information. These systems are part of the MIS infrastructure and
directly support the organization's strategic initiatives.

CHAPTER 2
1. What is Business process?

2. What is Information Systems?

 Hardware: This includes the physical devices and equipment involved in information
processing, such as computers, servers, networking devices, and peripherals.
o Physical foundation: Provides the physical components to run the system.
o Processing power: Executes instructions and processes data.
o Storage: Stores data and programs.
o Input/output: Enables interaction with users and other systems.
 Software: Refers to the applications and operating systems that run on the hardware.
Software can be categorized into system software (like operating systems) and application
software (like word processors or databases). (Programs and applications)
o Instructions: Provides the instructions to the hardware.
o Data manipulation: Processes and transforms data.
o Application programs: Performs specific tasks like word processing, spreadsheets, and
database management.
o System software: Manages hardware resources and provides essential services.
 Data: The raw facts and figures that are processed by the software to produce meaningful
information. This includes databases, data warehouses, and the information stored within various
systems. (Information processed by the system)
o Raw material: Provides the input for processing.
o Information generation: Transformed into meaningful information.
o Decision-making: Supports informed decision-making.
o Knowledge creation: Contributes to the organization's knowledge base.
 Procedures: The policies and processes that govern how data is collected, processed, and
disseminated. This includes workflows, guidelines, and standards that ensure the effective use of
the information system. (Rules and guidelines for using the system)
o Guidelines: Defines how to use the system.
 o Error prevention: Minimizes errors and ensures consistency.
o Efficiency: Optimizes the use of the system.
o Training: Enables users to effectively utilize the system.
 People: The users who interact with the information system, including IT professionals,
system administrators, end-users, and stakeholders. Their skills, training, and engagement are
crucial for the system's success.
o Operation: Uses the system to perform tasks.
o Maintenance: Keeps the system running smoothly.
o Security: Protects the system from unauthorized access.
o Innovation: Develops new ways to use the system.

CHAPTER 3
Standardize Business processes ASAP …
Improve an Activity: At the pizza shop, the Delivery process driving activity can be
improved by adding a GPS to each de- livery vehicle that displays traffic updates. As a
result, the measure of the Delivery objective— delivery time—is improved/ When a
doctor types a prescription for a student on a tablet, software can compare that medicine
to other medicines the student has been prescribed. If the new drug conflicts with any
previously prescribed drug or interacts with the patient’s allergies, a warning message is
displayed.
Improve data flow among activities: The system can suggest the most efficient order of
deliveries, considering factors like distance, traffic, and delivery time windows. Real-
time order data can significantly improve delivery efficiency. By feeding order
information directly to GPS displays in delivery vehicles, drivers can optimize routes,
reduce idle time, and make better decisions about fuel consumption and wait times. This
leads to faster deliveries, increased customer satisfaction, and improved operational
efficiency/ When the doctor writes a prescription during an office visit, the prescription
data can be sent to the local pharmacy so the prescription is ready when the patient
arrives. The data flows automatically rather than being hand-carried by the patient, there
are fewer errors about the prescription than when it is handwritten.
Improve control of activites: In the case of the pizza shop, IS controls ensure
consistency in pizza size, oven temperature, and sales transactions. The new computer
system for in-restaurant orders helps to prevent incomplete orders, reducing delivery time
variations and order errors. At the healthcare clinic, IS controls are used to reduce
appointment no-shows through automated reminders. Additionally, electronic health
records improve record-keeping and access control, enhancing patient privacy and data
security.

PROCURE TO PAY (Enteprise System in the procurement process)

1. Warehouse:
 Create Requisition: When inventory levels fall below a certain threshold or a new
product needs to be purchased, a warehouse employee creates a purchase requisition.
 Enter/Update Data: The requisition details, such as item description, quantity, and
supplier information, are entered into the EIS.
2. Purchasing:
 Create & Send Purchase Order: Based on the requisition, the purchasing department
creates a purchase order and sends it to the selected supplier.
 Enter/Update Data: Purchase order details, including vendor information, itemized list,
quantities, prices, and delivery terms, are entered into the EIS.
3. Warehouse:
 Receive Shipment: Upon receiving the goods, the warehouse verifies the quantity and
quality against the purchase order.
 Enter/Update Data: Receiving information, such as the date of receipt, quantity
received, and any discrepancies, is entered into the EIS.
4. Accounting:
 Receive Invoice: The supplier sends an invoice for the goods or services delivered.
 Enter/Update Data: Invoice details, including the invoice number, date, amount, and
payment terms, are entered into the EIS.
5. Accounting:
 Send Payment: Once the invoice is verified, the accounting department processes the
payment to the supplier.
 Enter/Update Data: Payment information, such as the payment date, amount, and
payment method, is entered into the EIS.

ORDER TO CASH

1. Sales:
 Receive Customer Inquiry: The sales department receives a customer inquiry for a
product or service.
  Create Quotation: Based on the inquiry, the sales department creates a quotation for the
customer.
 Enter/Update Data: Customer inquiry and quotation data are entered into the EIS.
2. Sales:
 Receive Customer Purchase Order: The sales department receives a purchase order
from the customer.
 Create Sales Order: The sales department creates a sales order based on the purchase
order.
 Enter/Update Data: Customer purchase order and sales order data are entered into the
EIS.
3. Warehouse:
 Prepare Shipment (Pick): The warehouse prepares the shipment by picking the required
items from the inventory.
 Enter/Update Data: Picking data is entered into the EIS.
4. Warehouse:
 Send Shipment (Pack & Ship): The warehouse packs and ships the items to the
customer.
 Enter/Update Data: Shipping data is entered into the EIS.
5. Accounting:
 Create & Send Invoice: The accounting department creates and sends an invoice to the
customer for the shipped goods.
 Enter/Update Data: Invoice data is entered into the EIS.
6. Accounting:
 Receive Payment: The accounting department receives payment from the customer.
 Enter/Update Data: Payment data is entered into the EIS.

Differentiate MIS, ERP, SAP *

Since our course name is Management Information Systems with ERP Applications, and we are
practicing SAP.
MIS (Management Information System)
- MIS is the system that focuses on collecting, storing, processing, and presenting information
about a company’s finances, operations, workforce and work processes from different
departments in the company
- Assisting in the analysis information, which managers deeply understand about financial and
operation situations. Therefore, company can set proper methods to improve the efficiency of the
management procedures across the organization and has forecasts and reports to make a detailed
plan for the performance.
ERP (Enterprise Resource Planning)
- ERP is a remote – access system that integrates core business processes of a company,
including finance, human resources, production, supply chain management, services,
procurement, and other sides.
- It provides continuous minitoring, allows the free exchange of information, and unifies all
operation processes for employees to estimate future activities, enhancing productivity, reducing
errors, and serves a holistic view of the business.
- ERP is part of a larger information management system, MIS.
SAP (System Application Products)
- SAP is a multinational company that offers ERP and other solutions and to business.
- It provides variety of options depending upon requirements by grouping process into modules
and interact with business aspects.
- SAP is one of the largest ERP providers and is widely used worldwide.

How was GBI (Global Bike Inc.) founded? *

Global Bike Inc. (GBI) was founded by John Davis, who initially created custom bicycles out of
necessity for competitive racing. After winning numerous championships, he realized that mass-
produced bicycles were inadequate for his needs. This led him to strip down four old bikes and
rebuild them into a single custom bike, which he referred to as the "Frankenstein" bike. As word
spread about his innovative creation, friends and competitors began requesting similar custom
bikes.In 1990, while recovering from an injury, John started producing the first series of
Frankenstein bikes in his garage. As demand grew, he expanded his operations into a full
manufacturing facility in Dallas, where he began producing custom trail bikes sold through
specialized bike dealers across the country. Simultaneously, Peter Schwarz, a German
engineering student and avid cyclist, was based in Heidelberg. While competing in regional
touring races and working at a local bike shop, he developed a reputation for his mechanical
skills and fierce competition. Inspired by his engineering studies, Peter designed and built a
revolutionary ultra-light composite frame for one of his racing bikes. Using carbon composite
materials, Peter created a frame that was significantly stronger and ten times lighter than existing
frames. Due to financial constraints as a student, he partnered with a local company to
manufacture his designs. Peter's innovative frames quickly gained popularity among European
racers, leading him to establish Heidelberg Composites to market and distribute these frames to
specialized bike stores and racing teams. After the appointment between Peter and John in 2000
and they recognized the potential of each other, in 2001, Heidelberg Composites and
Frankenstein Bikes merged to form Global Bike.

What is Global Bike’s current senior management structure?

Global Bike's current senior management structure features a co-CEO model with John Davis
and Peter Schwarz sharing leadership responsibilities. Here’s a breakdown of their roles: John
Davis (Co-CEO): Responsible for sales, marketing, service & support, IT, finance, and human
resources. He focuses on the Order-to-Cash and Service & Support processes.
Peter Schwarz (Co-CEO): Responsible for research, design, procurement, and manufacturing. He
oversees the Idea-to-Market and Build-to-Stock processes. Additionally, the organizational
structure includes various vice presidents overseeing specific functions, such as marketing,
research and development, and operations. This process-centric approach allows John and Peter
to focus on the key processes rather than just the functional areas of the company

Based on the organization chart that you sketched in the “Corporate Overview” task, can
you already identify implications on the ERP implementation project?
Based on the organizational structure of Global Bike, several implications for the ERP
implementation project can be identified:
- Centralized IT Functions: With IT functions centralized in the Dallas headquarters, the ERP
implementation can benefit from a unified approach to system integration and data management.
This centralization can streamline decision-making and ensure consistency across all divisions,
but it may also require careful coordination with the Heidelberg subsidiary to address specific
regional needs.
- Co-CEO Leadership: The co-CEO model means that both John and Peter have distinct
responsibilities that align with different business processes (Order-to-Cash vs. Idea-to-Market).
The ERP implementation must consider these processes to ensure that the system supports both
sales and manufacturing effectively, facilitating collaboration between the two areas.
- Geographical Distribution: With operations spread across the US and Europe, the ERP system
must accommodate different regulatory requirements (e.g., US GAAP vs. IFRS) and operational
practices. This may necessitate customization of the ERP solution to ensure compliance and
efficiency in both regions.
- Cross-Functional Collaboration: The organizational structure emphasizes a process-centric
approach rather than strict functional silos. The ERP implementation should promote cross-
functional collaboration, ensuring that all departments (sales, marketing, R&D, manufacturing,
etc.) can access and share relevant data seamlessly.
- Change Management: Given the diverse roles and responsibilities within the organization,
effective change management strategies will be crucial during the ERP implementation. Training
and communication will need to be tailored to different teams to ensure buy-in and successful
adoption of the new system.
- Scalability and Flexibility: As Global Bike continues to grow, the ERP system must be scalable
and flexible enough to adapt to future changes in the organizational structure or business
processes, especially as they expand their product lines or enter new markets.

After reading about Global Bike’s IT strategy, what weaknesses exist in the different
organizational units prior to the ERP implementation?
Prior to the ERP implementation, several weaknesses can be identified in the different
organizational units of Global Bike:
- Independent Application Environments: Before the integration of a centralized IT model,
divisions were running multiple, independent application environments. This fragmentation
likely led to inconsistencies in data, inefficiencies in processes, and difficulties in obtaining a
unified view of operations across the organization.
- Lack of Standardization: The existence of various independent systems may have resulted in a
lack of standardization in processes and reporting. Different units might have been using
different metrics and methods for tracking performance, making it challenging to compare
results or implement company-wide initiatives.
- Increased Operational Costs: Maintaining multiple systems can lead to higher operational costs
due to duplicated efforts in IT support, training, and maintenance. Each division may have had
its own IT resources, which could be inefficient and costly.
- Data Integrity Issues: With disparate systems, there is a higher risk of data integrity issues,
such as inaccurate or outdated information. This can hinder decision-making and strategic
planning, as leaders may not have access to reliable data.
- Limited Collaboration: The lack of a centralized system may have restricted collaboration
between different organizational units. For example, sales and manufacturing teams might not
have had real-time access to inventory levels or production schedules, leading to misalignment in
operations.
- Challenges in Compliance and Reporting: Different accounting standards (US GAAP vs. IFRS)
and tax regulations across regions could complicate financial reporting and compliance efforts.
Without a unified ERP system, ensuring compliance across all units would be more challenging.
- Resistance to Change: Employees accustomed to independent systems may resist transitioning
to a centralized ERP system, fearing loss of control or disruption to their established workflows.
This resistance can hinder the successful adoption of the new system.
Which objectives are already mentioned and which benefits are expected from the
implementation of ERP?
Objectives:
- Centralization of IT Functions: The move to a centralized IT model aims to consolidate all IT
functions in the Dallas office, which is expected to streamline operations and reduce redundancy.
- Cost Reduction: One of the primary objectives is to reduce operational costs associated with
maintaining multiple independent application environments.
- Consistency of Operations: The ERP implementation aims to deliver best-in-class technology
across all divisions globally, ensuring consistency in operations and process integrity.
- Support for Digital Transformation: The transition to SAP S/4HANA is part of a broader
strategy to accelerate Global Bike's digital transformation. Expected Benefits:
- Improved Data Integrity: A centralized ERP system is expected to enhance data integrity by
providing a single source of truth for all organizational data, reducing discrepancies and
inaccuracies.
- Enhanced Collaboration: By integrating various functions and departments into a single
system, the ERP is anticipated to improve collaboration across organizational units, facilitating
better communication and coordination.
- Streamlined Processes: The implementation is expected to standardize processes across the
organization, leading to increased efficiency and productivity. Better Decision-Making: With
access to real-time data and analytics, management will be better equipped to make informed
decisions, improving strategic planning and operational effectiveness.
- Compliance and Reporting: The ERP system will help ensure compliance with various
accounting standards and tax regulations, simplifying financial reporting and regulatory
adherence.
- Scalability: The new ERP system is expected to be scalable, allowing Global Bike to adapt to
future growth and changes in the business environment.