Chapter 12 - How finance function interacts with IT Flashcards
What is an information system (IS)?
Provision and management of info to support running of organisation
What is info technology (IT)?
Hardware that provides the infrastructure to run ISs
What is the IT function responsible for?
Planning, evaluating, installing, operating and maintaining hardware, software, networks and data centres required
What is a management info system (MIS)?
Converts internal and external data into useful info which is communicated to management
What are the different types of MIS?
- Executive info system (EIS)
- Decision support system (DSS)
- Transaction processing system (TPS)
- Expert system
What are the 2 broad types of knowledge?
- Explicit - knowledge company knows it has
- Tacit - personal knowledge and expertise
What are the factors that influence the pace of tech adoption?
- Feasibility
- Cost
- Economic benefits
- Availability of labour
- Regulation
How can having good IT infrastructure be beneficial?
- Adoption of new ways of working
- Productivity improvements
- Multi-source data capture and analysis
- Created of shared service capability
- Digitisation of info
- Flexible working practices
- Virtual organisations
What are the advantages of remote working?
- Lower infrastructure costs
- Increased employee motivation and productivity
- Increased commitment
- Reduced staff turnover
What are the disadvantages of remote working?
- Co-ordination difficulties
- Loss of control
- Dilution of culture
What challenges do virtual teams face?
- Forming a team
- Knowledge sharing
- Processes and goals
- Leadership
- Cultural differences
- Morale
What are the ethical and social issues with IS and data?
- Data protection
- Data privacy
- CDR
What are the initial costs of a new IS?
- Design and development if bespoke
- Purchase price if not bespoke
- Purchase of new hardware
- Testing costs
- Training costs
What are the running costs of a new IS?
- Labour
- Materials
- Service support
- Ongoing costs
What are the benefits of a new IS?
- Speed
- Accuracy
- Volume
- Complexity
- Collaboration
- Presentation
- Lower costs
What are the potential threats to privacy and security of an IS?
- Natural disasters
- Malfunction
- Unauthorised access
- Viruses
- Hackers
- Human error
- HR risk
What is systems arcitecture?
The way the systems infrastructure is organised
What are the 2 approaches to system arcitechture?
- Centralised (one location)
- Decentralised (many locations)
What are the costs of decentralised arcitechture?
- Higher costs due to duplication
- Barriers to sharing data
- Inconsistent data
- Loss of control
What are the benefits of decentralised arcitechture?
- Efficiency
- Ability to better meet local needs
- Fewer staff relying on one system
- Less reliance on key staff
- Problem diagnosis easier
- Security breaches less impactful
Why do the finance and IT functions have to interact?
- Smarter investment in IT
- Info security and compliance
- Data analytics
What do the finance and IT function work together to do?
- Identify appropriate KPIs
- Assemble KPI data
- Analyse
- Advise
- Apply
