Categories and Types of Information System and ERP System Benefits and Challenges

This essay explores the categories and types of information systems, such as process control, management reporting, inventory control, sales and marketing, human resources, and accounting and finance. It also discusses the benefits of ERP systems, such as improved efficiency and data management. Additionally, it highlights the challenges in deploying and using ERP systems, including training, installation and maintenance costs, and improper module selection. Possible solutions to these challenges are also provided.

ESSAY
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Table of Contents
INTRODUCTION ..........................................................................................................................2
TASK ..............................................................................................................................................3
a) Categories and Types of Information System:........................................................................3
b) ERP System and its possible benefits:....................................................................................5
c) Possible Challenges in deploying and using ERP:..................................................................6
POSSIBLE SOLUTIONS TO THE CHALLENGES:....................................................................7
CONCLUSION ...............................................................................................................................8
REFERENCES................................................................................................................................9
INTRODUCTION
Today's era is a market of technology and cut throat competition, in this environment
every company wants to be in a competition and needs to be updated with technology. For this
companies adopts two core system in their operations such as Information technology and ERP.
The term Information System is a composition of different personal, technology, and business
operations which are used to achieve corporate objectives. Information system manages every
information and data of a concern business which reduces time of the company and keeps a
systematic record of every information. Enterprise Resource Planning or ERP is a system which
companies install in its business process. The system comprises of a software which employs to
set and manage supply chain, various departments, and different processes of an enterprise.
Activities such as Customer Relationship Management, supply chain, procurement and
accounting management, etc. are managed by ERP system in the organization (Al-Emran, and
et.all., 2018). Both ERP and information system acts as an advantage to every firm and helps
management in taking quick decision, it also saves time and money as the system does not
require several personal to work upon it. Along with benefits these systems posses some
challenges while installing and when working upon it. Challenges such as installation and
maintenance cost, employee's training, technological up gradation cost,etc. In the present essay
the concept of Information Technology and Enterprise Resource Planning is being studied. In the
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report the key roles of both the system in managing and controlling company's information and
data are considered. The different types and forms of Information Technology and Enterprise
Resource Planning are discusses. Benefits which ERP system posses and what challenges
companies face while installing system are analysed. Further some recommendations and
suggestions are mentioned which supermarkets of UK should consider while operating on these
two system.
TASK
a) Categories and Types of Information System:
Information system or Management Information System is a technological software
which companies install in their organization for efficient and effective working within the
company. The system helps management to take faster decisions along with correct results. The
system keeps a sequential record of every information, data or of every departments working in
an organization. This comprises both the hardware and software. It works in a form of process
which starts from collecting of data from various different online systems and then analysing the
gathered data and then finally gives result to management for further decision making
(Andrianto, 2019). Management Information System (MIS) presents updated and valid data for
areas such as Raw Material, Inventory, Research and Development, Marketing, Finance, etc. The
system provides a central structure of information and correlates the whole data for management
of company.
Types of Management Information System:
There are various types Management Information system out of which company can
adopt any in their operations. The types are discusses below:
 Process Control: This includes monitoring of physical and industrial processes of
organizations. This type of system is categorised as important form of MIS adopted by
manufacturing companies. It is very useful in measuring efficiency in the manufacturing
system and also keeps check or machinery and safety of employees (Antoni, Fikari and
Akbar, 2018).
 Management Reporting System: This type of MIS makes reports regarding company's
finances and operations at all the levels of management in an organization. The system
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presents its report to management along with presentation of past performances of the
company with expected one.
 Inventory Control: This form of system presents record of inventory in hand, theft,
spoilage or sales made in the year during the course of business. This tells management
about the procurement and current stock of inventory into the business for further
production.
 Sales and Marketing: This form of MIS tells management about the company's sales
and marketing function such as projected sales, quality of products, distribution network,
etc. This gives an idea about the sale of products and their number as which variant is
high in sales and which is bearing low in market (Aremu, Shahzad, and Hassan, 2020) .
 Human Resource: The term refers to human workforce or personal working in an
organization. This type of system tells management to manage the passing of information
throughout the organization. For this company uses various electronic devices such as
land line phones, mobiles, internal mail system to pass information. it keeps a record of
employees in organization, their hirings, etc. in the organization.
 Accounting and Finance: This keeps a track record of assets and investments of the
company. This presents a report for financial data for law such as payroll, local and state
taxes,pension funds, federal,etc. It helps company in its financial audit and presents
annual report for the management and shareholders. It also maintains daily financial and
accounting transactions such and purchase and sales,transfers and deposits, etc.
(Bhumgara, and Sayyed, 2017).
 Local Database: This presents a deep information about the sections of society residing
across nation. This involves public data,social survey data, etc.
Relevant Examples from Supermarkets in UK:
 Management Information System at TESCO: TESCO is a multinational company
operating at large scale in the field of supermarkets. TESCO adopts Essential Information
System which is used by company's managers to manage and assess efficient running of
different departments in organization. This is used to analyse monthly statements of
expenditures which presents past, present and future data of materials to managers in
order to assist them in decision making. The system also tells managers about the actual
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working hours of its workers for a particular period of time. Essential Information System
shows loyalty schemes and pricing analysis which supports company to analyse their
customers.
 Management Information System at Marks and Spenser: The company uses
Inventory control form of MIS into its business which keeps a track record of all the
inventories procured, used and sold during business course. It also keeps a flawless
record of opening and closing stock of its products and inventories in the stores of
supermarket. Along with this the company also uses Human Resource Management
Information System which presents a fair picture of working hours of its employees and
store workers and the requirement of stores in terms of human resource.
b) ERP System and its possible benefits:
Enterprise resource planning better known as ERP system is a complete, integrated
system that manage all the aspects of production based, aligning financial management, supply
chain management, human resources, manufacturing or distribution with core function of
accounting. Different examples of ERP system are SAP, TALLY, Net Suite, Oracle EBS,
Acumatica etc. (Chofreh, Goni, and Klemeš, 2018). ERP system is a common software which
can be easily found in very organisation for proper maintenance of data and records of the
company. The systems are explained below in detail mention paras along with their benefits to
different organisation-
SAP: The SAP modules include finance, sales and human resource. According to the
need of business any module can be purchase. SAP software suit that is being implemented as
part of re engineering and tends to offer end to end solution for inventories, logistics, financial
and inventories. Organisation TESCO use this software in their business operation.
It provide various benefits to the organisation like it help TESCO to manage their data
efficiently, it tends to improve business efficiency, enhanced data security, also help in long term
monitory savings (Imes, Hollister, and Cottrell, 2017).
Tally: It is an accounting solution used by small or mid size business as it provide
services related inventory,finance,purchase, sales, accounting, manufacturing, point of sales,
payroll, branch management, job costing. Company Sainsbury. use such type of software to
perform accounting entries in their organisation. As it give advantage to organisation related to
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data reliability & security, helps in payroll management as it make the calculation of salary
simple, it help banks to easily make calculation related to interest on deposits as well as also
manage many different user accounts, Tax returns can easily be file by organisation Sainsbury
with the help of this software. It also provide quick access to documents like invoices, receipts,
bills, vouchers etc.
Net Suite: It offer end to end business related system which covers various different
areas like financial management and accounting, planning of different enterprise resource, E
commerce, customer relationship management , ware house as well as inventory management.
Organisation Morrisons use such software for accounting and management purpose in business.
As it gives so many benefits to company like it tends to improve visibility,efficiency,helps in
saving cost, leads to accelerated growth, supports to driven innovation. It offers self service
portal which enhance B2B as well as B2C collaboration (Leandro, Méxas, and Drumond, 2017).
Oracle EBS: It is integrated business applications as it concentrate on resource planning,
supply change related management , customer relationship based management . Oracle relational
database management system is core technological package driver (Muiruri, 2018). The
supermarket company marks & Spencer use such type of software in their business operations.
This software also give so many benefits to company in profitable manner. It help the
supermarket Marks and Spencer to make them ready for future. It also supports to increase
optimal performance, to serve the purpose of cost management improvement, tends to ease the
activity related to integration, migration as well as implementation. It also tends to enhance
broadest security services in the organisation.
c) Possible Challenges in deploying and using ERP:
Challenges refers to problems or hindrances which occurs at the time of installation of
ERP or when using the system. The challenges which companies may or usually faces while
deploying or using ERP system are discussed below:
 Proper Training: ERP system requires adequate training to employees after installation.
This can decrease productivity of operations as unfamiliar behaviour with the software
will create problem for employees to work on it. Proper training will help employees and
management team to use the software effectively and efficiently (Nakasumi, 2017).
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 Installation Cost: The cost involves procurement and installation of software in
business organisation. ERP is a costlier system compared to its initial cost. The software
needs customization according to the operating nature of business firm and this
customization involves huge cost. More and more customization becomes costly for the
company (Rainer, and et.all., 2020).
 Maintenance Cost: This cost occurs after installation of the system. ERP needs proper
care and maintenance as any corner left in maintaining the software will lead to
inefficient operation. Timely up-gradation of software sometimes results high cost to the
company.
 Improper ERP Module: Improper selection of ERP module brings unnecessary issues
in integration of the module. This will bring issues in data integration and analysis which
will create problem for management in decision making.
POSSIBLE SOLUTIONS TO THE CHALLENGES:
For every challenge there is always a presence of solution. The possible solutions for
challenges are mentioned below:
 Company should train and makes its employees familiar properly with all the necessary
concepts with related to ERP software. The best way to analyse the understanding level
of system is to have feedback and trial test of employees with software.
 Organisation should analyse cost in installing system and gets its match with company's
budget. If the cost is huge then company should see cheaper options and purchase
software with the firm offering at desired price.
 It is better to maintain software properly and take immense care of it. Company should
look for regular check of its software and when found need for up-gradation, it should
employ the change when necessary.
 Companies should analyse their need and requirements for ERP system and should install
the module which fulfils the requirements and is best suitable for organisation.
CONCLUSION
From the above essay it can be said that Information Technology and Enterprise
Resource Planning software are very crucial for every organisation to install in their business.
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The systems provides integrated data and information to management in order to take centralized
decision. These software's helps management in getting accurate and valid data about various
departments and fields or operations in business firm. Company gets efficiency while making
decisions as these systems provides various benefits to the organisation.
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REFERENCES
Books and Journals
Al-Emran, and et.all., 2018. The impact of knowledge management processes on information
systems: A systematic review. International Journal of Information Management. 43.
pp.173-187.
Andrianto, A., 2019, April. Impact of Enterprise Resource Planning (ERP) implementation on
user performance: studies at University of Jember. In Journal of Physics: Conference
Series (Vol. 1211, No. 1, p. 012040). IOP Publishing.
Antoni, D., Fikari, D. and Akbar, M., 2018. The readiness of palm oil industry in enterprise
resource planning. Telkomnika. 16(6). pp.2692-2702.
Aremu, A.Y., Shahzad, A. and Hassan, S., 2020. The impacts of enterprise resource planning
system adoption on firm's performance among medium size enterprises. International
Journal of Information Systems and Social Change (IJISSC). 11(1). pp.24-42.
Bhumgara, A. and Sayyed, I., 2017. Enterprise resource planning systems. International Journal
of Advances in Engineering & Technology. 10(2). p.283.
Chofreh, A.G., Goni, F.A. and Klemeš, J.J., 2018. Evaluation of a framework for sustainable
Enterprise Resource Planning systems implementation. Journal of cleaner
production. 190. pp.778-786.
Imes, K.R., Hollister, J. and Cottrell, J.F., Samsung Electronics Co Ltd, 2017. Mobile energy
management system. U.S. Patent 9,800,463.
Leandro, F.C.F., Méxas, M.P. and Drumond, G.M., 2017. Identifying critical success factors for
the implementation of enterprise resource planning systems in public educational
institutions. Brazilian Journal of Operations & Production Management. 14(4). pp.529-
541.
Muiruri, N.M., 2018. Effect of Integrated Financial Management Information System on the
Effective Management of Public Funds in County Governments: A Case of Kiambu
County (Doctoral dissertation, United States International University-Africa).
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Nakasumi, M., 2017, July. Information sharing for supply chain management based on block
chain technology. In 2017 IEEE 19th conference on business informatics (CBI) (Vol. 1,
pp. 140-149). IEEE.
Rainer, and et.all., 2020. Introduction to information systems. John Wiley & Sons.
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