I would like to express my deepest appreciation to all those who provided me the possibility to complete this report. However, it would not have been possible without the kind support and help of many individuals and organizations. I would like to extend my sincere thanks to all of them. A special gratitude I give to, Ms. Ruwini Karunarathna, whose contribution in stimulating suggestions and encouragement, also for her constant supervision in completing this assignment. I would also like to thank my parents and friends who helped me a lot in finalizing this project within the limited time frame.
With the vast rise in information technology, new methods and practices are introduced to the business world. Data and information are important part of any business organization. To store and analyse data manual methods are used in traditional business world. But, with time manual methods have shown a failure which helped to the rise of computer-based information systems. Information system is mostly established to retort to the trade world and many business initiatives. Information system strategy is crucial factor in corporate world. In short, it helps organizations to apportion, store, process data and transfer the data and information they create and collect.
Dialog Axiata PLC is one of Sri Lanka's largest telecommunications service providers, and the country's largest mobile network operator with 13.4 million subscribers which amounts to 44% of the Sri Lankan mobile market. Dialog is a subsidiary of Axiata Group Berhad which owns 83.32% controlling stake of the company while the rest is held by the public. Dialog was Listed on the Colombo Stock Exchange in 2005 June. As of February 2017 Dialog Axiata holds LKR 86.3 billion (US$573 million) in market capitalization and the 5th largest listed company in Sri Lanka by Market Capitalization. In 2015 "Dialog" brand name was valued at LKR 28.6 billion (US$204 million) and as the 3rd most valuable brand in the country by business magazine LMD in its annual study. In 2014 the company received the highest "Platinum" rating in the country's Corporate Accountability Index for the 4th consecutive year.
Dialog operates on 2.5G, 3G, 3.5G and 4G LTE communications networks, and became the first operator to launch commercial 3G and HSPA+ operations in South Asia when it rollout the network on 16 August 2006. In April 2013 Dialog Axiata launched its mobile 4G LTE services using 10Mhz of spectrum in 1800Mhz band becoming the first operator to launch commercial FD-LTE network in South Asia, initially delivering peak data rates of 50 Mbit/s.
In addition to its core business of mobile telephony, the company operates a number of services including Dialog TV, a Direct to Home Satellite TV service and Dialog Global which provides international telecommunication services. Dialog Broadband offers fixed-line and broadband internet services, whilst Dialog Tele-Infrastructure is the company’s national telco infrastructure arm.
Functional area of an organization is an area consisting a set of employees who are assigned for specific functions and operations to achieve the final goal of the organization. Functions are the building block of the organization which supports the operations of the business. Dialog Axiata PLC as a business organization too consist of several functional departments as follows.
Among these departments Finance, Customer Service, Sales and Human Resource departments can be considered as the most important functional areas of their organization.
Information need is a requirement or expectation of a person about an information source which leads to decision making or completing a task. When working in function areas of an organization each function of an area requires some sort of information to get their work done properly. So, information needs are very important facts needed in running a business.
For an example, to search into a customer’s account information as requested by a customer their mobile number, account number or NIC is required at Dialog PLC.
In other words, information need can be called as the inputs of a system which helps to process and bring out meaningful output.
Finance can be defined as that administrate area or set of administrative functions in an organization which relates with the preparation of cash and credit so that the organization have the means of carrying out its objectives as pleasing as possible. (Ozioko,2017)
As an organization cannot operate without money, finance section can be considered as the vital functional area of any organization. It is solely responsible for accounting, planning and organizing organization’s finances. Its primitive function is to guarantee the financial stability and firm cash flow to backing the day today transactions of the organization. Apart from paying bills and providing money for the financial requirements of the company finance department is also responsible for give proper counselling for the processes of funding and borrowing of the business’s money. Dialog Axiata PLC’s finance department consist of finance functions like;
Every organization consists of expenses. So, they should be paid at the right time to keep up balanced finance in the organization. Finance department of Dialog Axiata PLC is responsible to collect all the receipts related to expenses and make payments to them at the right moment.
One of the most important resource of an organization is its workers. To maintain a proper relationship with them it is important pay their salaries accurately and on time. At Dialog PLC finance department is responsible for calculating their salaries and making the payments. For this purpose, they use the payroll system. With this system accurately, salaries are calculated and deposited to the irrespective bank accounts.
According to Ozioko (2017), financial reporting is the function that takes raw accounting entries and transforms them into meaningful, usable and comparable financial statements. Financial reports are essential to check out the profit and current state of the organization. So, the accounts should be updated regularly and at the end of financial year or within a certain period of time relevant financial reports like income statement, SOFP should be prepared. At dialog Axiata PLC financial reports are generated through the system and with the inputs to the system.
Among the functions in the finance department, book keeping plays a vital role. It engages in recording and tracking all day-to-day transactions of the organization. It comprises of all the expenses, income, sales, purchases and etc. Mainly book keeping process is done by a bookkeeper or a clerk. But at Dialog Axiata PLC the bookkeeping process is done by the system so the relevant workers of the department have to regularly input and update the transactions into the system.
Expenses and investments are transactions of a company where cash is supplied in bulk amounts. So beforehand to supplying the cash the organization heads should have an idea about what they are going to step in to. In this activity financial department can provide advice and facts regarding the expense or investment to the seniors. Which will provide the seniors with a better sense to whether invest in a particular project or not.
Before hand to applying their cash of an organization it is better to have proper plan. Cash flow estimates and budgets helps in this process. In the process of preparing cash flow statements and budgets all the assets, staff, department costs, expenses and liabilities of the organization are considered. Taking up all this past data, the relevant personals can calculate the amounts of cash to supply in each section and on each factor in the coming financial year. Which helps in manging the cash properly without wasting unnecessarily.
To operate functions of the finance departments globally recognized information system, SAP (System Applications and Products) is used by Dialog Axiata PLC. And to pay salaries and wages they use a system called Payroll system. Through these systems most of their manual work is reduced and it benefits all the functions of the department.
The process of paying salaries following procedure takes place,
In the process of paying salaries many information are input into the system which get processed create meaningful output reports. Here when the salary amounts of irrespective employee is entered to the system along with the deductions related to EPF, loan reductions and additions like OT and bonus, system calculates the relevant salary amount and updates the accounts related to them. After the process takes place successfully system generates salary slips and tax calculation receipts as outputs. According the Manager of the Dialog Axiata PLC Galle branch, this is the procedure takes place in their organization related to paying staff salaries.
In producing financial statements, a whole process takes place at Dialog Axiata PLC,
In this process sales, expenses, assets, liabilities like information input into the system which updates them into relevant places in the structures of the financial reports and performs calculations regarded to them. Profit calculation too occurs within the system. Then the system generates outputs like SOFP (Statement of financial position), POL (Profit or Loss statement) and annual income and expense reports.
For these like processes to take place properly and accurately, most accurate and exact information should be input into the system. In the finance department to carryout their functions properly information like assets and liabilities, revenue and expenses, staff salaries and wage details, bank balances are required.
Customer service department is a significant part of any organization. Customers interact with the organization through this department. Here customers can do inquiries, complaints and orders. Main purpose of this department to provide good support to existing customers which leads to bring new customers to the business. In a business it is very important to keep the customer loyalty towards the organization for this purpose customer should be provided with the most efficient and accurate services. At Dialog PLC customer service department provides functions like;
Storing customer information refers to gathering information from customers and preparing accounts for them according to the product/service purchased by them. At Dialog Axiata PLC this process is done trough the system. Customers are said to fill out a form which carries data criteria. Then the data in the forms are entered into the system by officers.
In storing customer profile information following procedure takes place.
Here, customer details like name, telephone number, NIC, gender are taken from the customer using a form. Then they are input into the system creating a account for them. When the account is created a registration SMS will be sent to the customer.
Ex: Activating a new SIM card
When a customer requires anew product / service there is a certain activation procedure. Customer is asked to fill out a form regarding the product which allows the officer to get information about the needed product. If the customer has an account in the system, the officer will activate product/service through the system if not he will make an account for the customer and then add the product.
If a customer is not satisfied or thinks that the service is irrelevant, they can cancel the service. At dialog Axiata PLC this procedure is done through the system. They check for the service in relevant customers account and cancel it out and prepares an invoice including charges for the service rendered up to that date.
Processing bill payments is one of the most important tasks of the customer service department. When the customer pays the bill relevant data input into the system. The system does the calculations and sends the balance figure to customers account.
In payment of bills following process takes place;
When the customers have any questions related to the products or services they try to contact the organization and inquire about them. At Dialog Axiata PLC there’s a telephone-based system to answer the questions relate to products and services.
Customer complaints and giving solutions to them is a part and parcel of any product/service-based business organizations. To maintain a good relationship with the customers the organizations have to provide efficient and quick solutions to their problems. At dialog Axiata PLC they look and detect for the problems their customers have through their system and gives them an immediate response.
For the processes in the customer service department at Dialog PLC, system called CCBS (Customer Care Billing Systems) is used. Through this system they are able to provide their customers with proper service which helps in maintaining the standard of their organization.
Customer service department requires information like customer details, nature of the complaints recorded, and inquiries done by the customers to provide a better service through their department.
Sales department of an organization is solely focused towards the sales done by the organization. This department is responsible to keep track of day to day sales, improving sales content, advertising and develop ways to keep up consistency in sales. At Dialog PLC too sales department plays huge part for the business. Because if the sales are done well revenue is sorted out which leads to balancing out the expenses as well. In their organization sales department consist of functions like,
Sales is one of the most important tasks of any organization. At Dialog Axiata PLC sources of sales is sales of sim cards, fixed lines, Dialog TV, broadband and digital services. Keeping track of sales is a must. So, the systems are used to update statistics on sales.
Sales department have a track of record of which has high sales, and which has low sales according product as well as region. According to these analytics they are able to organize promotional campaigns and advertising.
As sales is a very important facet keeping daily records is a must. The system of sales department is daily updated about sales as the finance department get information from the daily sales report produced by the sales department at the end of the day.
Stocks is changing factor with sales. So, to have happy customers the organization should have the stocks up to date. At dialog Axiata PLC when the stock reaches the minimum stock level the system informs the production unit and procurement unit about the stick necessities. Then the relevant personnel’s are informed and they fill the stock back to normal levels.
Apart from the sales unit in the organization there are external personnel who do sales of the products and services of the organizations. They are sales personnel and merchants. At Dialog Axiata PLC sales done to them and sales done by them are recorded in the system. Apart from recording these systems perform calculations of sales done by the sales personnel and send their salary details to the HRIS to proceed.
Process of updating salespersons sales to HRIS takes place as follows,
Human resource department is a functional area of an organization which is responsible to issues regarding employees of the organization. Human resource is a vital asset of a business. The primitive function of the HR department is ensuring the welfare of employees and developing activities to motivate, guide and advise them so they work productively within the organization. At Dialog PLC HR department consists of functions like,
To enable a better performance within the HR department systems called Human resource Information system (HRIS) and Human Capital Management System (HCM) are used.
To accurately conduct operations of these systems, employee details, employee performance records, salary and wage details like information are required.
Employee leave request management process takes place as follows,
2.1 Different levels of an organization and their information needs.
An organization can be divided into different level according to different purposes and activities. Similarly, for management purposes and decision-making purposes an organization can be divided into three main levels as,
In the above picture, levels divided to the vertical axis are the organizational levels.
As per the view point of Hartzell, strategic level refers to the top-level of an organization which consists of senior-level executives of the organization or people who hold a high responsibility on the organization. Mainly the strategic level of an organization consists of job titles like CEO (Chief Executive Officer) and CFO (Chief Finance Officer). These top managers are in authority for setting the total path of a company and making sure that major organizational aims are attained. At Dialog Axiata PLC, the top level or strategic level consist of job titles like Head, General manager, Senior General manager, AVP (Assistant Vice President), VP (Vice president) and CEO. Their main task is to make extreme decisions regarding the business. Each of these job titles have specific job roles in the organization which helps in the management and growth of the organization. The job roles of the job titles in strategic level of Dialog Axiata PLC are as follows,
Head at the Dialog Axiata PLC are responsible team management and profitability management. Team management refers to coordinating a group of people in a proper path to achieve the organizational goals. So, the Head should communicate well and set goals to the employees to make them perform well. Apart from that he is responsible for profitability management which refers to a workable but simplistic approach that seeks to maximize revenues and minimize costs. (Kugel,2013) In simple words that is increasing income and decreasing expenses. Head should forecast the best ways to increase income and minimizes expenses. In this case he has to handle the pricing of products as well such that a maximum profit is gained, and the customer is satisfied with the price.
Risk management refers foreseeing the risks that can occur within the organization and giving solutions to them. So, the Senior general manager must have a proper idea about the functioning of the organization to identify the future risks that can occur within and must provide solutions to each and every problem. Apart from that he is also responsible for business continuity planning. According to Kenton (2019) Business continuity planning (BCP) is the procedure involved in generating a system of prevention and recovery from probable threats to a company. BCP and risk management are well connected with each other which ensures the organization to keep away from future risks and threats. Senior general manger has to identify threats and risks, bring up proper solutions, test the solutions and review the results to have a proper strategy.
Evaluating new business services discusses identifying the pros and cons of recently introduced services of the organization. VP has to keep updates about the sales and functioning about recently introduced services and evaluate whether they are successful or not which will benefit in whether to make the service a permanent or not.
Regulatory management is an organization's obedience to laws, regulations, guidelines and conditions relevant to its business processes (Rouse). So VP is ought to check whether the business process are conducted according to the legal conditions or not which will help the organization to keep away from unnecessary fines.
To execute these job roles and proper decision-making proper information is needed in the strategic level. Mostly strategic level is required with external information rather than internal. So internal information is presented in precise and summarized form which is more qualitative. But external information should be both quantitative and qualitative. Analysis of competitors, profitability of the departments and whole business, cash needs for the business, levels of the resources of the business, legal policies, rules and regulations of the government, required capital in future and future market predictions are information required by the strategic level of Dialog Axiata PLC for proper decision making and strategy planning.
According to Kukreja (2019), Tactical level or Middle level is referred to as the executory level, they are subordinates of the top-level management and are responsible for the organization and they direct the operational level. They are also the communicators between the strategic level and the operational level as they transmit information, reports, and other data of the organization to the strategic level. So, this level can be considered as the bridge in between strategic level and operational level. Tactical level mainly consists of managers and directors. At Dialog Axiata PLC tactical level is comprised of Specialists, assistant managers, Manager, Senior manager and chief manger. Making day today decisions, preparation of financial documents, creating reports for strategic level, recruitment hiring, sales and marketing activities, regulatory reporting and executing the decisions from strategic level can be considered as the major tasks performed by the tactical level. The job roles of the job titles in tactical level of Dialog Axiata PLC are as follows,
According to pricingsolutions (2018), Price Management is the process of integrating all viewpoints and information necessary to consistently attain at ideal pricing conclusions. At Dialog Axiata PLC specialist is accountable for the price management. Specialist has to arrive at conclusions with existing information to give a product its optimum value and he should provide reasons for the decision which will help in approving the price from the strategic level.
Billing Management refers to handling all processes related to billing. Specialist at Dialog Axiata PLC is responsible with billing management. Keeping proper records, making decisions regarding issues related to bills and making reports for the strategic level are some tasks related to billing management.
Business partners are important stakeholders of any business. It is necessary to maintain a proper relationship with them. At dialog Axiata PLC assistant manger is accountable for maintain a proper relationship with business partners and manging them. If any mishap occurs between the business and the partner, it can bring a huge loss to the business to avoid this proper business partner management should be conducted. Business partner management includes keeping proper information about partners, giving priority to them, making payments and updating them with necessary information like tasks. Business contract is an important documents or agreement between two parties which contains conditions of both parties (Cameron,2018). It enables to have a good relationship with the partner. So, keeping up with the terms and conditions in a particular contract when processing a deal or project is important. Assistant manager of Dialog Axiata PLC is in charge of managing contracts. Keeping the contracts safe and noting down its terms and conditions are the tasks involved in contract management.
According to Rous (2014), business development is the process which develops the business side of an organization. At Dialog Axiata PLC manager is in authority of business development process which includes tasks like identifying the rising business opportunities and build long term relationships with the prospects. This process helps in maximizing the profits and revenue of the company. Performance management refers to the activity and set of processes that aim to maintain and improve employee performance in line with an organisation's objectives (CIPD,2018). To maintain success of the organization employee performance should be ensured. Manager is accountable for performance management at Dialog Axiata PLC which includes tasks like keeping track of employee performance, giving them feedback about their performance and motivating employees to perform better.
To properly function in the tactical level necessary information for the procedure should be supplied to them. Tactical level receives this information from the other two levels. Strategic levels give them the instructions and information about their decisions while operational level provides them with regular qualitative and quantitative information. At Dialog Axiata PLC the information needed and received by the tactical level are statistics on labour, cash flow within the business, inventory turnover, purchasing requirements, production related reports, network performances and risks, threats in the business.
According to Kalpana, the operational level or the bottom level of an organization consist of the first line managers who oversee the hard work of the staff and actually carry out the operational work in an organisation. The job titles like supervisors and inspectors are seen in this level. They are accountable for addressing the functions of the enterprise as instructed by the managers of the other two levels. At Dialog Axiata PLC the operational level consists of job titles like Officer, Executive, Co-ordinator and Senior Executive who are assigned to tasks like Customer management, after sales service management, doing sales, complaint management, invoicing, payment processing and administrative and maintenance of the organization. The job roles of the job titles in operational level of Dialog Axiata PLC are as follows,
To properly function in the operational level necessary information for the procedure should be supplied to them. Operational level receives its necessary information from the tactical level of the organization. All the information gathered in this level are internal information and they are comprehensive. At Dialog Axiata PLC the information needed and received by the operational level are inventory levels, customer details, price details of the products, employee details and details on outlets.
Information criteria needed in different levels of an organization is shown in the following diagram,
The information criteria needed have different qualities according to the level of the organization they are required. When considered the time basis of information needed by the levels of the organization, strategic level needs long termed statistics like monthly reports and yearly reports but the operational and tactical level workers have to perform and make decisions based on day to day details the information needed by them are daily reports and immediate. The level of detailing in the required information to the strategic level are highly summarized because it should help in making quick decisions but in the tactical level and operational level moderately detailed and highly detailed information are required because they should help them to analyse the performances and prepare reports to the strategic level. The source of information needed by the strategic level are biased towards external than internal because they have to tackle with external parties more than internal, but source of information needed by tactical and operational levels are internal as they tackle with internal issues mostly. Degree of certainty and frequency of information used by strategic level are ambiguous and uncommon, but the tactical level and operational users need convinced and common information.
2.2 The functions and purpose of different information systems types and their need and effectiveness in different levels of the organization.
To increase efficiency and to accurately perform within levels of organization having a proper information system is a necessity. There are few types of information systems which is supportive in this process. Those information systems are as follows,
Transaction processing systems are computerized systems that performs and keep records of the day today transactions of the business. It is a significant part in the operational level of an organization. As per Young (2016) purposes of having a TPS are,
Like in any normal system TPS too have three main functions which are input, process and output. Input functions include recognizing data on a source document, entering the input data into the system, and checking input data for errors. Output functions include producing reports, such as detail reports, summary reports, and exception reports. Storing data in databases, retrieving stored data, categorize stored data and update data are included in storage functions. Processing functions involve the manipulation of data and decision making.
Proper functioning of a TPS is depicted in the following diagram.
At Dialog Axiata PLC a different type of TPS systems are used for different purposes. One type of such TPS is the payroll system. Payroll system is used by them to calculate the salaries and wages of the employees and generate reports about the salary details of the organization. Apart from salary calculations it keeps records of attendance and leaves of employees, deductions in the salaries, allowances given to employees and loan details. Here respective employees input their details, the system performs necessary calculations and computations and managers requests for reports. Another type of TPS is the billing system. Billing systems are used to produce bills at the point of transactions. Apart from producing bills they keep records of product details and customer details, records on special discounts and offers, monthly and annual sales details and inventory levels. Receptionists and officers input details about transactions, products and customers, system performs necessary calculations, updating and computations and the managers request reports on sales details, product details and inventory.
A TPS is a system which is very well connected with the operational level of a business and it should out reports for decision making of the tactical level of the organization. Because of this a TPS should be effective. A TPS is effective as it has following features.
Quick performance with rapid response time is critical. Transaction processing systems are usually measured by the amount of transactions they can process in a given time period.
An organization have many transactions happening over the time so the TPS should be continuously available. Many organizations rely severely on their TPS. A collapse will interrupt operations or even halt the business.
The system must resist to hardware or software issues without destructing data. Apart from authenticated users the nobody should be allowed to change or insert data.
Immediate users of a transaction processing systems are casual users. The system should be simple for them to understand, defend them from data-entry errors as much as probable, and allow them to effortlessly correct their blunders.
According to Inc (2019), a management information system (MIS) is a computerized database of financial information organized and programmed in such a way that it produces regular reports on operations for the management of the company. It is generally also likely to obtain special reports from the system easily. The basic motive of the MIS is to give managers feedback about their performance and the strategic level an idea about the organization as a whole. Information displayed by the MIS typically shows "real" data over against "strategic" results and results from a year before; hence, it measures improvement against objectives. MIS serves the tactical level of an organization. MIS receives its input data from the TPS’s of the organization.
The main goals of an MIS are to help executives of an organization make decisions that advance the organization’s strategy and to implement the organizational structure and dynamics of the enterprise for the purpose of managing the organization in a better way for a competitive advantage. Following are the goals of an MIS:
Within most management information systems there are four system types.
Following diagram depicts the functioning of a MIS.
Effectiveness of a MIS depends on the roles conducted by it. Following are the roles performed by a MIS
Nonetheless of whether it is a marketing, financial or operational issue, managers need quick access to information so that they can make good decisions that will have a positive impact on the company’s performance. MIS improve this by strategically storing vast amounts of information about the company in a central location that can be easily accessed by managers over a network.
Data from everyday operations in the company is collected and brought together with data from sources outside the organization. This enables a healthy and functional relationship between distributors, retail outlets and any other members of the supply chain. It also helps keep good track of performance since production and sales numbers will be recorded and stored in a central database that can be accessed by all members of the MIS. Access to this information also helps ensure that problems are detected early, and decisions are made quickly using the latest information.
In any company, there are many situations that call for input from several individuals or departments before decisions can be made. Without an efficient communication channel, these decisions can take a very long time. Even with good communication channels, if the different stakeholders don’t have access to all the available data, the process would hit a number of snags before it’s complete. MIS ensure that all the members of the decision-making group have access to all the data that’s required to make the decision.
Executives use these systems to make projections of the expectations from the particular decision. If they decide to go ahead with the changes, there will be a need to keep monitoring the performance to see if you are on track to achieving the desired results. MIS give detailed reports which helps in evaluation of the goals smoothly and effectively.
MIS are favoured by large companies is the effectiveness of the reporting features. The decisions can be made quickly because the information is presented in an easy to understand format. The fact that the system is accessible by people from different parts of the organization makes it an effective reporting and communication tool.
The computerized information systems that help in decision making and problem solving can be named as Decision Support systems. DSS are collaborative computer-based systems intended to help decision makers use communications technologies, data, documents, knowledge and models to successfully complete decision-making task. DSS mostly involved in the operations of strategic level sometimes in tactical level. DSS uses historical and present information from both external and internal sources which helps the executives to make better decisions. DSS contains of analytical tools, models and technologies which combines with massive amount of data to make it easy to use and to provide better source of information to facilitate the decision-making process.
According to Sur (2013), objectives of a DSS are,
Following diagram depicts the functioning of a DSS,
According to Sur (2013), DSS is effective because it consists of following characteristics.
DSS enable and help in precise decision-making activities and decision procedures.
DSS are computerized systems designed for collaborative use by decision makers or staff users who control the sequence of interaction and the operations performed.
DSS can facilitate decision makers at any level in an organization. They never aim to replace the decision makers.
DSS are planned for repeated use. A specific DSS may be used regularly or used as needed for essential decision support tasks.
DSS may be independent systems that collect or duplicate data from other information systems or subsystems of a larger, more integrated information system.
DSS provide specific capabilities that simplify one or more tasks related to decision-making, including intellect and data analysis, identification and design of alternatives, choice among alternatives and decision execution.
DSS are intended to progress the precision, timeliness, quality and overall efficiency of a certain decision or a set of associated decisions.
It permits users to access data from various sources simultaneously, leaving organizations the to select the data warehouse that best suits their unique necessities and likings.
DSS delivers a collaborative, accessible platform for rapidly emerging and deploying projects. Multiple projects can be formed within a single shared metadata. Within each project, development teams generate a wide variety of re-usable metadata objects.
DSS comprise of features that are flexible and can be changed according to necessity providing a helping hand in the work process.
An executive information system (EIS) provides important information, gathered from both internal and external sources, to senior executives and managers. It achieves the multiple purposes of supporting decision making, communicating information, and providing awareness. EIS’s typically present summarized information but allow the user to drilldown to more detailed information. EISs grants information in accessible format to facilitate easy analysis. EIS’s are mostly involved with the strategic level of an organization.
According to Creps and O’Leary (1994) EIS helps in following tasks,
Drill-down analysis is the ability to start from an aggregated number and then examine (drill down to) the more detailed underlying data. As the user moves to finer and finer levels of detail, it is possible to find more detailed analysis of specific exceptions.
Often, EISs are integrated with spreadsheets. This integration facilitates the analysis of data using the full capabilities of the spreadsheet.
In some situations, EISs also offer more sophisticated analysis tools than those provided by standard spreadsheets. For example, an EIS might provide for timeseries analysis, sophisticated statistical analysis, or optimization analysis using a tool such as linear programming.
Knowledge discovery uses computers to manipulate data to try to find knowledge in that data. Although knowledge discovery is in its infancy, there are some important tools already available that can be used to tease trends or behaviours out of data.
Following diagram represents the proper functioning EIS,
3.1 The importance of having current, valid , accurate data and information for effective decision making and forecasting in your organization.
When dealing with day today activities in a business having current, valid and accurate data is quintessential. According to lotame (2019), there are several aspects that contribute to the quality of data and information. They are accuracy, relevance, completeness, validity, timeliness and consistency.
Accuracy denotes to how well the data describes the actual conditions it intends to define. Inaccurate data can be a sole reason which can lead to incorrect assumptions and conclusions. So, having accurate data and information is a must for any organization.
The data and information collected should be relevant to the purpose it is used. Even if the data has all the qualities needed but doesn’t match with the goal then that data is not useful at all. So, to precisely function in an organization data relevance is important.
There are no gaps in data if it is complete. If there are gaps in data, it will be a huge issue for decision making processes. So, when gathering data and information completeness is a factor that should be minded.
Validity refers whether the data is correct and in the right format. If there’s any validity issue in the data gathered it would create unnecessary mishaps in the organization.
The data gathered should be of recent ones because with the time value of information decreases. Because historical data have a very less impact on the decisions we make.
If a data is gathered regarding some situations they should be of the same type and shouldn’t differ according to other factors. For an example, if someone’s name is George it can’t be another in a different situation. So, some particular kind of data should be consistent.
If the organization expects to have proper data, those data should include above qualities. Data and information remain to become gradually vital for businesses. Companies rely on data for decision making about advertising, product advancement, finance and more. So, having data ensuring data quality is a must. As per the point of view Lotame (2019), having good data quality have many benefits as follows,
Proper and good data have a low risk in making the decisions go wrong. If the organization possess quality data, it will allow the executives and mangers to make good decisions as the confidence in good data builds up your assurance to make the decision.
With quality data the organization can identify their correct customer base and they provide the product/service according to the customer’s preferences. So, the organization can keep their customer base by satisfying them with the help of quality data and information.
The organization can use gathered data on customers’ likings, interests and desires to provide them with products/services that pleases them and even anticipate their desires. This will help in bonding with customers which creates a good customer relationship.
Quality data cuts down unnecessary costs and helps in providing the product or service for a cheaper value than the competitors which allows the organization to get returns with high profit margins.
Good data and information are good resources to any organization. They allow the organization to foresee good opportunities in the industry which will help in giving a tough time to their competitors.
3.2 Use of an information system for management reporting purposes.
Information systems are used to output important information with the data input into the system. Reports are formats which comprise of such information. According to Lebied(2018), Management reports are documents which intends to inform executives and managers of different facets of the business, in order to help them in decision making process. In other words, reports are presentation of an organizations present and historical data. Management reporting offers intuitions on how the organization is performing, authorizing decision-makers to find the correct route to increase operating effectiveness and make appropriate decisions.
As per Lebied(2018), management reporting provides following benefits to an organization.
According to the purpose there are several types of reports. They are,
Profit and loss reports are documents which provide insights about the organization’s income, expenses and profit/loss for a certain period of time. Profit and loss reports are mainly produced by the financial section of an organization. Profit or loss reports are called in other names like statement of comprehensive income, income statement and statement of financial results. Usually these reports outline the business transactions within a quarter or a year.
The profit or loss report of Dialog Axiata PLC is as follows,
Here expenses are deducted from total income of the to calculate net profits. Profit or loss reports are use by them to study sales patterns and for procurement planning.
According to Akers(2019), A sales analysis report shows the inclinations that occur in an organization’s sales volume over a period of time. Sales reports the mangers about market opportunities, areas sales can be increased, which products are most suitable in production and what type of promotions and marketing tactics can be used to promote the sales of the product. Apart from these mangers can have an estimation about market prices, assessment of previous and current sales and assessment of the product demand.
Following is a format of a sales report.
Stock reports represent the volume stock available and their individual prices. These reports allow mangers to analyze stock , sales and purchase rates of the organization. Also, it insights the market values of stock, how much should the organization separate for stock purchasing purposes and the stock turnover. Following is a format of a stock report,
Marketing trend forecasting is a type of reports are complex but beneficial way to look at previous sales or market evolution, determine probable inclinations from that statistics and use the information to generalize the upcoming. Trend forecasting is a measurable estimation, which means projecting is based on tangible, existing historical data. It uses time-based data, which is data where the numerical value is valued at certain points of time.
There are several patterns the trend forecasting appears in the graph,
Constant trend is visible when there is no net growth or reduction in sales over time. Average sales become constant though the sales at specific date varies.
A linear pattern is a stable reduction or rise in figures over time. Linear patterns can be represented in a graph diagonally up or down.
an exponential pattern shows that statistics is increasing at an increasing rate over time. Instead of a straight line directing diagonally up, the graph shows a curved line which signifies later years had a higher rate than the first year, if the rate is rising.
4.1 Different models (Porter’s competitive advantage, Wiseman’s Strategic Planning Process) that can be applied to strategic information systems.
Strategic information systems are used as a tool to gain competitive strategy. According to MBAskool (2019), Competitive Strategy can be defined as the long-term plan of a certain company in order to gain competitive advantage over its competitors in the industry. It is expected at generating superior position in an industry and generating a stable revenue.
Competitive advantage refers to conditions that allow a company to produce a good or service of equal value at a lower price or in a more desirable manner (Twin,2019). In other words, applying better competitive strategies in the organization can lead to competitive advantage of the organization. Without reaching competitive advantage an organization cannot survive in the industry as it leads to many advantages like producing excess profits, sustainable growth in the industry, creating huge customer base, allowing many investors to invest in organization’s projects and have good reputation in the industry. So, to have a good competitive advantage it should fulfill following attributes.
Competitive advantage must be unique. If an organization cannot provide a unique product or service from other organizations, then that organization cannot reach competitive advantage. Because if all its competitors and they will have to share the customer base. If any changes like adding new features to product/service, offering the product/service to a low amount like unique qualities can help in reaching competitive advantage.
Competitive advantage should be sustainable which means it should remain a long-lasting period. Investors who are planning to invest in an organization will have doubts if their investment is safe.
Relevance is one of the key factors. If the competitive advantage of the organization is not goal specific it can be a reason for our investors to look down upon the organization.
To survive and succeed in the industry five competitive strategies can be used,
To build up competitive advantage and a successful strategic plan with the help of strategic information systems some exemplary models have being introduced by several academics. Porter’s competitive advantage model and Wiseman’s strategic planning process are such models.
"Achieving competitive advantage requires a firm to make a choice...about the type of competitive advantage it seeks to attain and the scope within which it will attain it (Porter,1985). Michael Porter is the initiator of the contemporary strategy field and one of the world’s most significant thinkers on management and competitiveness. To successfully gain the market share with efficient strategy planning Porter introduced two models,
Porter’s generic competitive strategies includes three interconnected concepts which will help a business organization outperform its competitors and have a stable market share in the industry. The interconnected concepts are cost leadership, differentiation and focus. Following diagram implies how these three interconnected theories can be used in the strategy planning process and gaining competitive advantage.
Cost leadership refers to a technique which decrease costs and produce the least expensive products in an industry in the struggle to gain and maintain the market share (myaccountingcourse.com,2019). The contemporary business environment is a very complex and as the customers are attentive about other choices available in the market. One of the best ways to reduce this risk is having a cheap price compared to competitors. If a business is able to generate their products/services with a lower production cost they will be able to offer the customers with a cheap price. To reduce production cost the business organization must look into unwanted expenses created during the production process and reduce them and they should efficiently use the human resources as well as machinery. Also using the capital of the business into new technologies and investment will help in lowering the operating expenses in the business. Apart from that companies must be able to keep control of the products from point of creation to store fronts. Cost leadership should be efficiently used such that switching cost should be an amount that is unbearable by the customer base of the business.
According to Whiting (2018), differentiation refers to a method that a business takes to generate a unique product or service that customers will find better than or in another way distinctive from products or services offered by competitors. Using differentiation concept business are able to select attributes which its customers tends to believe important when purchasing and make them unique and attractive. These attributes are design, technology, features, services and brand name. if a business can include differentiation as their strategy. Apart from these innovative pricing too can be used to differentiate the product from the rivalries.
To accurately implement the Differentiation strategy, an organization needs the following:
Cost leadership and differentiation strategies helps to increase the customer base by attracting them but focus strategy is different it a sort of a risk an organization takes. Focus strategy allows an organization to focus on a particular customer group or a particular product. On the other hand, by appealing a particular group the company is able to captivate an progressively loyal set of customers.
There are two variants in focus strategy,
Cost Focus: organizations which intends to find a cost advantage in their industry segment.
Differentiation Focus: These organizations work to find a unique industry as probable in order to maximize efforts.
According to CGMA (2013), Porter's Five Forces model is a simple framework for evaluating and estimating the competitive strength and position of a business organization in the industry. This model is based on the concept that there are five forces that govern the competitive strength and appeal of a market. Porter’s five forces help to recognize where influence lies in a business. This is useful both in understanding the strength of an organization’s present competitive position, and the strength of a position that an organization may move in the future.
Following diagram represents the five-force model,
The five forces are,
Profitable industries appeal new entrants, which makes the organizations to share the profitability with the competitors. Unless organization have strong and durable barriers to entry. factors like economies of scale, capital requirements, switching costs or government policies, can increase the barrier to entry and will help in being competitive.
This refers to the possibility of your customers finding a different product that would provide the necessities your product does. A replacement that is easy and inexpensive can deteriorate your position and threaten your profitability. So, keeping a higher margin in price considering the switching cost will help to keep you customers loyal.
Suppliers can apply their power by raising prices and reduce the quality of goods. So it is good for an organization to be in good terms with them.
If you have a low customer base and strong rivals this force will threaten you, nonetheless. So, to keep the power over customers the organization must use strategies to improve their product and resist their rivals.
The main force is the number and ability of competitors in the industry. Many participants, offering indistinguishable products and services, will decrease market appeal. So to drive this force out it is better to use differentiation strategy.
According to mbaskool(2019), The strategic theory of wiseman supports the organization in obtaining the maximum statistics from the resources of the organization for its competitive advantage. There are three main groups to the strategic theory of wiseman, including suppliers, competitors and customers. To gain the competitive advantage these parties are combined together to form five kind of organizations. These are:
Differentiation thrust: This helps in focusing on the information that has been left unfulfilled or there is some gap in the expected and provided service.
Cost thrust: this kind of thrust focuses on minimizing the cost and increasing the competitor cost.
Innovation thrust: This kind of thrust focuses on doing something different which includes making new products with differentiating features and specifications.
Growth thrust: This kind of thrust focuses on increasing the horizon of the business that includes increasing volume and market size.
Alliance thrust: This kind of thrust focuses on the mergers and acquisitions for increasing the business and making the firm more competitive.
Global market is a place comprising of different countries and nationalities. According to Martin (2016), Global marketing is known as the process of regulating the marketing tactics of your business to adapt to the conditions of other countries. As the cultures and different nationalities are different from each other, the customer base might have different tastes and preferences than our local market. So, competing in a global market is a very crucial factor.
As reaching international market gives benefits firms who have the ability tend to step towards. But retaining and facing the competition in the global market is very tough. So, organizations must use strategies to overcome the risk of failure in global market. Following strategies can be implied by the firms to reach competitive advantage in the global market,
The global market comprises of different nationalities and people with different preferences. So allowing variations and customization in product and services can play a huge role in reaching competitive advantage in the international market. The firms can produce products according to the different tastes like culture specific products to attract customers. Customization allows the customers to select and order a product according their preference. Dialog Axiata PLC can introduce e-sim, 5G network and AI products to the market. Because of the uniqueness and new variation in these products the firm will be able to attract customers from both local and global market. This strategy will help them to reach competitive advantage against their competitors like, Mobitel, Hutch, Airtel and etc.
Price of a product or service is a very influential thing to attract the customers. So, to reach competitive advantage can allow the customers a lower price than their competitors. Low price will attract more customers which will bring a significant revenue to the company. Dialog Axiata PLC can allow their customers with a low rates voice, SMS, broadband and IDD services along with high quality. As their prices are low compared to others more customers will be attracted and existing wouldn’t think of the replacements because of high margin in the switching cost.
As much as the customers are familiar with firm’s brand name the firm has and advantage surpassing other competitors. In the process of making the brand name popular advertising and promoting plays a huge role. Dialog Axiata PLC can market their brand name in all platforms of communication like social media, television, news papers and etc. For this purpose, they can display advertisements in television and social media, create posters and display their brand names in billboards. When marketing in global market different languages and international languages must be used to gather the international audience. With more exposure to brand name huge customer base can be attracted.
When considered customer preference convenience plays a major role. In the sense if the product is available to them wherever and whenever they need it company name can be highly popular. For this purpose, the company can have its outlets and service centres around the areas their target audience is. In the case of Dialog Axiata PLC, they can have branches in the around the world and they can create a worldwide system where any person can reach the company via the internet. And they can create an online platform such that they can sell their product with a faster delivery service.
When considered the global marketplace it is a very tough place to retain while keeping up with the competitiveness. One of the best strategies is that the company can merge with another company which can benefit both the companies. The company can cover up labour shortages and location issues and the merging company can introduce an innovative product than what they were selling up to now. Dialog Axiata PLC can merge with a foreign company and they can introduce their product with new technology to the global market without recruiting new staff or hunting for new locations. While the company can they are merging can share the profit Dialog receives according to the pre discussed percentages.
Strategic information systems play a major role in business organization. It supports firms to distribute, store, process statistics and move the data and information they acquire. It also permits and offers numerous tools and facilities for assisting the organizations day to day activities. Apart from being beneficial to the roles and responsibilities of the firm the information systems tend to have significant role in dealing with the competitiveness of the organization.
According to Thakur(2019), information systems can contribute to competitiveness in following ways,
A firm can use information systems to offer products or services that are unable to replace or that are used to serve highly focused markets. This averts the entry of competitors as they find the cost for implementing a parallel strategy very high.
Information systems can be beneficially used in the sales and marketing field. These systems treat prevailing information as a reserve. An organization could use its databases to track the purchase made by its customers, to identify various sections of the market, etc.
Competitive advantage can be gained if the firm is able to stick their prevailing customers to their firm. Information systems can be used to offer benefits to a customer or a supplier, that it becomes hard for them to shift towards a competitor. An organization may progress its information system and give many advantages to its customers, like steadfast order filling, reduced transaction expenses, improved management support and faster distribution service.
Information systems help in reducing the manufacturing cost of a product or service and their internal costs. With the help of information systems, the firm can detect the unnecessary expenses and track competitor discount rates which help the firm to offer their product much cheaper than the rivalries.
This tactic identifies precise tasks in the firm where competitive tactics can be best used and where information systems are most likely to have a superior strategic influence. Accordingly, the technology can be used to extract crucial information, and highlight important details which will lead to competitive advantage.
https://searchcompliance.techtarget.com/definition/regulatory-compliance [Accessed on 28th May 2019]
Available from: https://www.myaccountingcourse.com/accounting-dictionary/cost-leadership-strategy [Accessed on 6th June 2019]
Available from: https://www.lotame.com/why-is-data-quality-important/ [Accessed on 8th June 2019]
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