Management Information Systems

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Business Processes

A business operates based many business functions, which involve a collection of business processes or are part of a large business process. Business processes are a collection of activities required to produce a product or service and it's goals are to increase efficiency, innovation and costume service, and help with competitive advantage.

Information systems play a huge role in business, enabling new business models, enforcing policy and regulation, easing information sharing and collaboration and automating business processes. There are IS for sales and marketing (Customer Relationship Management - CRM), manufacturing and production (Supply Chain Management - SCM), human resources (Human Resources Management System - HRMS) and finance and accounting (Accounting Information System - AIS).

Also, there are IS for each level of management of an organization.

For operational management there are the Transaction Information System (TPS), which automates and collect data from the business processes. For middle management there are the Management Information System (MIS), which monitor, control and predict performance using summarized data from the TPS, but has little analytical capability, and the Decision Support System (DSS), which support non-routine decision making using data from the TPS and the MIS as well as from external sources. For senior management, there are the Executive Support System (ESS), which support non-routine decisions requiring judgement, evaluation and insight, in graphical displays with a friendly user interface, using data from external sources, the DSS and the MIS.

Knowledge Management

In the last years knowledge becomes an economy. Companies are aware of the negative impacts of the loss of system knowledge (when an employees leaves) and the cost of mismanagement. This economy is raising with the growth of digital media, which brings the challenges to manage internal data, extract knowledge from employees and harness external data.

Knowledge is different from data and information, it's the pattern, rules and contexts where the information is useful. It may be explicit or tacit. The explicit knowledge correspond to just 20% and is all the documented knowledge. The tacit knowledge corresponds to 80% and is informal, undocumented that lays on the employee minds and organization culture.

Together with knowledge there is wisdom, which is when, where and how to apply that knowledge.

The objective of knowledge management is to acquire, store, disseminate and apply knowledge to meet the organization's missions. In other, simple words, it's objective is to connect the ones who know with the ones how need to know.

A KM system can be implemented in 3 general steps. First, developing a sharing environment, that encourages employees to share and document their knowledge. Second, implementing a search engine to easily access that store knowledge. Third, building an intelligent system able to make suggestions and compute solutions on top of the search engine.

To all this implementation to be possible it needs support from senior management and must engage the whole organization.