Chapter 2: Business Processes and Decision Making Flashcards
Business process (aka business system)
a series of activities, tasks, or steps designed to produce a product or service. A business process is best thought of as a system
An inventory management system
supports the inventory process by collecting information
An inventory database
might keep track of what the customers have ordered (quantity ordered) and what is currently in inventory (quantity on hand)
reorder point.
When a good in stock hits this point, the inventory management system advises the manager that it is time to order new supplies.
purchase order (PO)
which lists the items ordered and the quantity desired
purchase order (PO) List
This purchase order is sent to the supplier.
The supplier receives the purchase order and then ships the appropriate goods along with the shipping invoice to the restaurant.
The shipped goods are first checked to make sure the restaurant received what was ordered.
The newly received goods are then placed in inventory and the inventory database is updated with the quantity received.
The supplier is then paid for the goods the supplier has shipped.
A business process consists of
1) activities,
2) resources,
3) facilities, and
4) information.
Activities
can consist of purely manual actions (people following procedures), automated or controlled procedures used by computers (hardware directed by software), or, as is often the case, a combination of manual and automated procedures.
Reources
are items of value. A case of milk is a resource, a person working is a resource, and the customer’s cash is a resource. In Figure 2-1, both suppliers and customers are considered resources because they have value in this process. They are not considered activities because they are external and, therefore, not under the restaurant’s direction and control.
Facilities
are structures used within the business process. Resources can be stored within facilities. Examples of facilities include factories, pieces of equipment, trucks, filing cabinets, and the like. In the case of digital resources, facilities might include inventories and databases
Information
the fourth element of a business process. Activities use information to determine how to transform the inputs received into the outputs produced. Because this book is about information systems, and understanding the nature of information and ways of defining it are crucial, information created in processes will be our focus.
Business Process Modelling Notation (BPMN)
software industry standards organization called the Object Management Group (OMG) created this
BPMN provides four graphical elements that can be used to document a process
Information definition
Very hard to have one specific one
most common definition is that information is knowledge derived from data, whereas data is defined as recorded facts or figures.
Another definition of information
information is processed data or, sometimes, information is data processed by summing, ordering, averaging, grouping, comparing, or other similar operations.
characteristics of good information.
1) Accurate
2) Timely
3) Relevant
- To context
- To subject
4) Just barely sufficient
5) Worth its cost
1) Accurate information
Information that is factual and verifiable
information system (IS)
Function can develop a bad reputation in the organization if the system is known to produce inaccurate information. In such a case, the IS becomes a waste of time and money as users develop workarounds to avoid the inaccurate data.
2) timely information
produced in time for its intended use.
