Information Systems and ERP Systems: A Comprehensive Analysis

Desklib provides past papers and solved assignments for students. This report explores information systems and ERP.

Managing Information & Technology

Contents
Task 5:.............................................................................................................................................3
Introduction:................................................................................................................................3
Categories of information system:...............................................................................................3
ERP Systems:...............................................................................................................................4
Benefits of ERP system in real life business:..............................................................................5
Conclusion & Recommendations:...............................................................................................6
References........................................................................................................................................8

Task 5:
Introduction:
The information system & enterprise resource planning is need of today’s business
organizations. The information system functions in the conversion of different data of the
organization into the required useful sequential information which can be further utilized for
taking out the solutions to different problems in the organization. Different types of information
system are discussed in this essay. The information system like: executive information system,
management information system, transaction information system along with the decision support
system is explained. The primary objective of this essay is to explain various information
systems existing in today’s technological era. Along with the different kinds of information
systems, the ERP systems are explained in detail and the role of ERP (enterprise resource
planning) in the large scale & small-scale business organizations is also discussed. The ERP
systems are very beneficial in accomplishing the many tasks, with automation & accuracy. Due
to automation in many operations of the system, the accuracy is always reflected in the outcome
of the operation. The ERP system also plays an essential role in the real-life business &
therefore the benefits of the ERP system in managing various operations of the business is
explained in the subparts of this essay. The recommendations for improving the ERP system is
suggested which will be helpful in improving the execution or implementation of ERP system
successfully. The major advantages of ERP system like: flexibility, scalability, reduced capital,
productivity, efficiency, etc. is discussed. The ERP helps in enhancing the productivity by
reducing the time taken to complete the particular task & making the system to work
automatically. This saves the time, & the saved time can be utilized to perform some other
essential functions. The other benefits like forecasting & collaboration is also discussed in this
essay in context in application of ERP in business organizations.
Categories of information system:
Information system is software that plays the role of converting the set of data (values in
database) into the usable information (organized data) and analyzing that data which is used by
the organization to take decisions by answering the questions & making solutions of the
problems. The information system is not a single system but actually it is made up of different
parts that are integrated to form the information parts. Such parts are: network, software, people,
hardware, database, software. There are various categories of information system existing in an
organization which follows a hierarchy as majorly all the organizations are hierarchical. The
most commonly& widely used model for classifying the information system is the “Pyramid
model”. According to the pyramid model information system is classified particularly in five
types:
 Transaction processing system
 Decision support system

 Management information system
 Executive information system
Transaction processing system: The information system which is used to note down the
transaction of an organization on daily basic is called transaction processing system. This
information system is particularly made for use by the users existing at the bottom level of the
organization (pyramid) & comes under the category of operational level system. The primary
objective of this is to assist other systems by generating information. The transactions & events
are the inputs of transaction information system while lists & various reports are the outputs of
the common examples of transaction system are: reservation system, payment & fund transfer
system, payroll system, etc.
Decision Support System: The information system which is intended to be used by the upper
level management like seniors or managers in the process of decision making on irregular basis.
DSS also assists in analyzing the information which is already present in the information system
which directly influences the decisions of the upper level staffs. In DSS, the inputs like
transactions, internal data is processed to get the output in the form of reports, graphs &
forecasting. The processing of the input takes place in the form of form of modeling&
forecasting. Examples of DSS are: spreadsheet models, group decisions support system, etc.
Executive information system: The information system comes under the category of the
strategic level management. It is generally used by the upper level staff like seniors & managers
for the purpose of analyzing the surrounding culture of the organization, to recognize the long
term as wells to take necessary actions of the organization. Executive information system also
shows the data taken from external information sources as well as internal sources. The
processing of the information is done in the form of summarizing the input files & simulation.
Management information system: The information system which is intended to be used by the
middle level officials like managers & comes under the category of management-based
information system. The managers use this information system to check & evaluate whether all
the operations in the organization is completing in a right & smooth manner or not. Examples:
budgeting system, sales management system & inventory control system, etc.
ERP Systems:
The ERP system is an enterprise resource planning system which is often considered as business
process management system which assists the business firms & organizations to utilize different
applications in order to achieve the function of managing the firm as wells to complete other
back office work. The enterprise resource planning manages all the operations like planning
regarding product; it’s manufacturing & sales marketing. ERP is generally used by the business
organizations which are operating on large scale & therefore a team of experts is the essential
requirement to modify & analyze the information. The reason is that ERP is widely used only by

the large- scale business organization is that it is very expensive to set ERP. The small ERP
solutions are provided by the SaaS technology to the vendors which are then circulated by them
to the small -scale firms. Apart from the above discussed functions of the ERP, it is nowadays
widely adopted by the organizations is that it helps in enhancing the efficiency & the
performance of the business up to approximately 55% & at the same time it reduced the capital
by 55% to 60%. There is wide range of enterprise resource planning software's are used by
business & available in market: sage intacct, netsuite ERP, odoo, SYSPRO, oracle ERP cloud,
Microsoft Dynamics GP, SAP ERP, etc.
There are many categories of ERP system and some of the primarily used ERP software are
discussed below:
 Vertical ERP: Vertical ERP is related to the particular industry. Generally, the startups &
small companies like retail, construction & supermarkets is the major client. Microsoft
dynamic AX is one of the most commonly by used ERP tool in the category of vertical ERP.
 Generalist ERP: Majorly, the cloud ERP & legacy are generalist ERP. The benefit of
generalist ERP is that solutions provided by it have the feature of perfect integration &
customization.
 Small business ERP: Small scale ERP are generally the off the shelf cloud ERP solution
& it is also known by the name of on -premise ERP solution.
 Open source ERP: This is smallest part of entire ERP. It assisted in improving the
efficiency, flexibility to generate new app & integrating it with the EPR Odoo ERP. It also
contributes to improving the usability.
ERP can perform many functions of business organizations. The assists in ERP can easily
perform the task of financial management. It can easily do accounting & transactions. ERP can
also develop reports regarding the finance for almost all the parts of the organization. The ERP
also contributes in Sales & marketing. The ERP modules can easily can help in the inquires
related to the sales, orders, etc. The modern & latest updated ERP system can perform the
function of tracking the orders as well as application of rules of taxation. ERP also play a vital
role in manufacturing. It enhances the manufacturing by contributing in the sectors of
manufacturing like planning of the product, sourcing the items & other material, regulating the
production on regular basis & forecasting the number of products and materials required. The
other important functions which the ERP play in the sector of manufacturing are: preparing the
milestones & scheduling every phase of production.
Benefits of ERP system in real life business:
There are ample numbers of advantages of using ERP system in the business organizations.
Some of the most essential benefits of using the ERP system are:
 Forecasting: The forecasting becomes very easy by using the enterprise resource planning
software as ERP software provides such features & tools which can accurately perform the

task of forecasting. Due to accuracy in the forecasting the estimated values & estimated
numbers become approximately equals to the actual quantity.
 Efficiency: The ERP improves the efficiency of the system as it removes the process or
the operation which are repetitive in nature & there no requirement to enter the set of
information manually. Streamlining the organization is also an important benefit of ERP & it
leads to ease in the process of data collection.
 Collaboration: The ERP systems helps in collaborating the different departments of the
same firm as all the set of information entered in the ERP system is centralized & updated on
regular basic. This ERP system covers every department; therefore no option is left in
collaborating the different departments.
 Integrity: Even if all the information is scattered at different parts of the database system,
the data is always located at a single location which maintains the integrity of the
information. Various systems can be integrated with each other like: CRM can be integrated
with the ERP which results in storing the information accurately, in unique & consistent
manner.
 Saves money: ERP system helps in decreasing the cost related to the administration as
well as the cost associated with the operations performed in the business.
 Productivity: The ERP system contributes a lot in improving the productivity by
decreasing the time required to perform the operations as all the operations & major
functions become automated which provides the solution of the problem more precisely
 Streamline business: The ERP software plays a vital role in streamlining the business.
The ERP interrelate different departments. Like in the process of manufacturing, all the
different functions become automated which avoids the risk of duplicating the data &
automatically update on the completion of the orders & reminder for delivery on time.
 Flexibility & mobility
Conclusion & Recommendations:
There are many points which need to be considered for successfully executing the enterprise
resource planning in the organization or work place. Some of the essential recommendations for
improving the ERP system are:
 Making the list of all the requirements & other major points of the
organization: The first & the foremost point which is very essential for easily implementing
the ERP software is that all the major requirements of the business should be integrated at a
single place in the document. Do not add the unnecessary things in the document, only try to
add the requirements which are specifically needed by the business & are related to the
functionality of the operations.
 Solution design should be robust: In order to prevent disaster in the design. All the
scenarios need to be taken care of. If not possible try to focus on the important scenarios
which are in direct relation to the business requirement.
 The project management organization need to be expert at their work: If the
members of the project management team are not strong at their work of identifying the

scope as well as to select the correct ERP tool for the business then the business project will
definitely fail.
 Testing: The testing of the ERP system needs to be done so that any kind of failure will
be avoided in the actual functioning of the business operations.
 Training: The training should if the system fails due for any reason.
The Enterprise resource planning is one the essential tool which is widely used in the
organization in order to perform the certain number of tasks by integrating the different
departments of the organization. As well as the information system is very useful in providing
the solutions to the enquiries. Therefore, information system as well as the ERP system has
become the essential need of today’s business firms.

References
Andre, L. (2019). What is ERP Software? Analysis of Features, Types, Benefits, Pricing -
Financesonline.com. [online] Financesonline.com. Available
at: https://financesonline.com/erp-software-analysis-features-types-benefits-pricing/ [Access
ed 14 Mar. 2019].
Chris-kimble.com (2019). Different Types of Information System and the Pyramid Model.
[online] Chris-kimble.com. Available
at: http://www.chris-kimble.com/Courses/World_Med_MBA/Types-of-Information-
System.html [Accessed 14 Mar. 2019].
GURU99 (2019). Types of Information System: TPS, DSS & Pyramid Diagram. [online]
Guru99.com. Available at: https://www.guru99.com/mis-types-information-
system.html [Accessed 14 Mar. 2019].
Management study guide (2019). Types of Information Systems - Components and Classification
of Information Systems. [online] Managementstudyguide.com. Available
at: https://www.managementstudyguide.com/types-of-information-systems.htm [Accessed 14
Mar. 2019].
Sandeep Walia, H. (2019). Top 5 Recommendations to Ensure Your ERP Implementation is
Successful - ERP Software Blog. [online] ERP Software Blog. Available
at: https://www.erpsoftwareblog.com/2009/10/top-5-recommendations-to-ensure-your-erp-
implementation-is-successful/ [Accessed 14 Mar. 2019].
study.com (2019). What Are Information Systems? - Definition & Types - Video & Lesson
Transcript | Study.com. [online] Study.com. Available
at: https://study.com/academy/lesson/what-are-information-systems-definition-types-
quiz.html [Accessed 14 Mar. 2019].
Wokwise software (2019). Top 15 Benefits of Implementing ERP Software | WorkWise ERP
Blog. [online] Workwise LLC. Available at: https://www.workwisellc.com/erp-software/15-
benefits-implementing-erp-software/ [Accessed 14 Mar. 2019].