Information Systems in Organizations: A Detailed TESCO Case Study

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Added on 2024/07/01

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This report provides a comprehensive analysis of information systems within TESCO, a leading multinational retailer. It begins by evaluating the information needs of different functional areas such as finance, human resources, sales, training, and administration, highlighting how each department relies on effective information management for optimal performance. The report then describes various types of information systems used by TESCO, including Executive Information Systems (EIS), Management Information Systems (MIS), Decision Support Systems (DSS), Enterprise Resource Planning (ERP), and Transaction Processing Systems (TPS), illustrating their applications with specific examples. Furthermore, it investigates current trends in using information system applications to solve business problems within TESCO, evaluates the suitability of these systems for different functional areas, and explores alternative methods for addressing challenges related to information management. The report concludes by addressing a problem faced by TESCO due to an improper information system and suggests alternative sources of information systems to handle the information effectively.

INFORMATION SYSTEMS
IN ORGANIZATIONS

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TABLE OF CONTENTS
Introduction................................................................................................................................ 1
TASK 1......................................................................................................................................2
A.C1.1 Evaluate the information needs of the different functional areas of your chosen
organization............................................................................................................................2
Task 2......................................................................................................................................... 5
A.C2.1 Describe minimum of five different types of Information Systems used in your
chosen organisations in task 1 and give examples of each....................................................5
A.C2.2 Investigate the current trend in using Information System applications to solve
business problems in your chosen organisation in Task 1.....................................................8
A.C2.3 evaluate the suitability of information system for different functional areas of your
chosen organization in task 1...............................................................................................10
Task 3....................................................................................................................................... 15
A.C3.1 Use an information system to generate valid, accurate and useful information for
any given problem of your selected organisation................................................................15
A.C3.2 Evaluate alternative methods of solving the problem identified in 3.1.................17
Conclusion................................................................................................................................20
References................................................................................................................................ 21

LIST OF TABLES
Table 1: Information system...................................................................................................... 8
Table 2: Suitability for distribution..........................................................................................12
Table 3: Administration suitability.......................................................................................... 13

LIST OF FIGURES
Figure 1: Information flow at TESCO.......................................................................................2
Figure 2: Various departments at TESCO.................................................................................4
Figure 3: Effectiveness of EIS................................................................................................... 5
Figure 4: MIS effectiveness.......................................................................................................6
Figure 5: application of DSS system..........................................................................................7
Figure 6: TPS...........................................................................................................................12
Figure 7: TESCO......................................................................................................................15
Figure 8: Integration of functions of sales department............................................................16
Figure 9: Artificial intelligence a tool for meeting integration efficiency...............................17
Figure 10: Client server model.................................................................................................18

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Introduction
TESCO is a leading multinational company in Britain dealing in merchandise, grocery and
other products such as books and toys. The headquarters is in UK. It has been observed
through the statistics that TESCO is the third largest retail store in terms of revenues. It has
almost 12 branches all over the world. The organization provides various services such as
financial, telecom and internet services. This report will consider the role of information
system in the various departments of TESCO. The first task will describe the role of
information system in the functions of management such as human resource, sales, training
and administration. The second task will describe the current trend in using information
system and the suitability of information system in the various functional areas. The last task
will conclude with the problem that is faced by TESCO due to improper information system
and how the alternative sources of information system can be used to handle the information.
1

TASK 1
A.C1.1 Evaluate the information needs of the different functional areas of your chosen
organization
About information system of TESCO
TESCO is a leading retailer of groceries, books and other merchandise in UK and many other
places around the globe. It has many branches in around 12 countries that has to be
effectively managed. This is possible only with the help of problem information system
management in the organization. Initially TESCO offered only high quality groceries at lower
prices so as to achieve customer base, gradually it started diversifying its products and
geographical location. TESCO entered into the market of software, toys, books, financial
services and music systems (Rahman, 2015).
There was a significant impact of diversification in the position of TESCO. This made them
increase their focus on employee performance and development. The employees of the
organization were given equal opportunities of being heard and their ideas entertained. Also
maintaining the morals and cultural values is essential so as to gain the support of society and
government. There has to be a proper information system so that the data’s of all the branches
can be collected and analyzed for improving performance. This information system also
enhances the process of communication and flow of information in the organization. TESCO
has developed its own software for collecting and storing of Data (Morgan et.al, 2017).
Information need of different functional area of TESCO
Figure 1: Information flow at TESCO
(Source: wordpress.com, 2018)
2

Finance Department:
Finance is one of the most complex and major department at TESCO handling various
activities such as resource funding, preparation of annual reports, employee payroll, and tax
payment and financing expenditures of the various departments. These functions effective
performance depends on how well the management information system works in an
organization. The main role of information system at TESCO is managing proper investment
decision, collection employee attendance and calculation of employee salary (Kukreja and
Gupta, 2016). Also the department supports the organization during economic crisis. Finance
department supports the working of overall organization by providing economic feasibility.
Human resource department:
Humans are the most vital resource of an organization. They need to be well managed in all
the departments. The human resources need to be trained, guided and supported for effective
performance. Proper allocation of human resource requires collection of data of all
departments so as to find the requirement and collection of employee detail so that the
employee are given job roles that best suit their skill and personality. Another major issue in
big organizations like TESCO is the reduction of employee turnover, which is the number of
employee leaving the organization. The management need to prepare effective appraisal
strategies so as per the performance so that they feel secured and do not switch their jobs.
Information system in human resource department of TESCO enables proper collection and
storing of employee details so that the work is distributed as per the relevant skill and
knowledge of the individual.
Sales:
The most important function of any organization is managing sales so that the profits can be
maximized. TESCO deals in various products such as books, music downloads, toys,
software etc. information system in sales department helps to collect relevant data of the
current market condition and then these data are used for various strategic calculations to
forecast the future sales (Minor et.al, 2015). This helps in finding the demand for various
products in the market and maintaining employee focus on increasing sales and production.
The sales department need to coordinate with other departments such as administration and
marketing so as to gain knowledge of the market trend and customer needs. This will also
3

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assist in making sales strategies as per current market norms. The department also need to
collect feedback and conduct surveys from the customers.
Training:
Training department is a part of human resource department where the information system is
used to collect the data of the employees so that proper training can be provided as per the job
requirement. This will lead to effective achievement of targets of the organization. The
management need to adopt new technologies to impart proper training and practical sessions
to the employees. This will not only help in achieving organizational goals but also assist in
self development plans of employees.
Administration:
The administration department of TESCO is responsible for holding and managing the
various departments of the organization together. The structure and management of TESCO
depends on how efficiently the administration department works (Laudon, 2016). The
information system helps in proper structuring and regulating proper environment in the
organization.
Figure 2: Various departments at TESCO
(Source: alamy.com, 2018)
4

Task 2
A.C2.1 Describe minimum of five different types of Information Systems used in your
chosen organisations in task 1 and give examples of each
Information systems in the organisation are effective for enhancing the operational excellence
of the Tesco in order to attain higher profitability. With such systems business usually
manage correct amount of stock in the store with bringing changes in the operations. For
properly management of the operations there are different types of information systems used
in the business that includes:
Executive information system (EIS): It is the suitable kind of management support system
that facilitates and supports for information to the executives and also with taking effective
decisions in Tesco. It helps Tesco to gather, analyse and summarise the key internal and
external information to the management of operations. It basically involves huge amount of
analysis of data that emphasis business to take strategic decisions. For example, such system
is mainly applicable in the operational decision making of manufacturing, marketing and
financial (Yu et.al. 2015). It enhances the strong drill down capabilities to have better
analysis of the information but huge databases can lower down the system performance and is
hardly to be managed.
Figure 3: Effectiveness of EIS
(Source: Expertmind.com, 2018)
5

Management information system (MIS): It is effective to process the financial information
that is organised and programmed to carry daily operations of Tesco. It helps in inputs of
statistical data along with involving the process of distribution. In addition, stronger security
is added to maintain secrecy in the data and secure the processing of organisation. For
example, effective database management system is effectively required for processing and
effective storage of data (Laudon and Laudon, 2015). It supports each departmental
functioning to manage own operations for enhancing the productivity of the business. Tesco
need proper management of operations with support of such systems in the business for
enhancing effeceincy and profitability.
Figure 4: MIS effectiveness
(Source: MIS working, 2018)
Decisions support system (DSS): Business in case of facing uncertainties in some situations
uses such system to take accurate decisions. For example, in case of failure of marketing
strategies in the current year, business takes support from such system to gather information
of the case where proper strategy is applicable in the situation. Data occur in the form of
complex spreadsheets and databases helping in protection from the negative impact of
external and internal environment. It requires mainly database for faster processing.
6

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Figure 5: application of DSS system
(Source: DSS, 2018)
Enterprise resource planning (ERP): Such integrated systems act as the core management
software for handling business processes and in real time handling of operations. Tesco use
ERPs for tracking business resources such as cash flow management, CRMs, product cycle
management, supply chain management, etc with handling the operations of purchasing,
manufacturing and distribution (Pearlson et.al. 2016). It store different types of data with
performing different computerised systems. Tesco being large businesses, need to manage
huge storage of data for delivering efficient large business outputs.
Transactions processing systems: These systems are designed for maintaining the regular
transaction processing. For example, it require billing systems for sending invoice to the
customers, accounting systems to calculate weekly and monthly payrolls and tax payments,
purchasing systems to have the effective purchase of raw materials, stock control systems for
effective management of the inventory. However, it requires effective storage and databases
for effective control over the finances (Mars, 2018).
7

A.C2.2 Investigate the current trend in using Information System applications to solve
business problems in your chosen organisation in Task 1
Table 1: Information system
Information
system
Trends Application Suitability
Executive
information
system (EIS)
It helps senior level
professionals for
handling the external
data in determining the
overall vision and
scope of the business
processes usually
supporting in
integration and
aggregation of the data.
It helps on finding the
root cause of problem
with having the root
cause of data.
Such systems are mainly used for
executive to get help in strategic
situations. It helps business to
overcome from the negative impact
of the macro global environment
with utilisation of hyper text and
hyper media (Kasemsap, 2018)
For strategic
decisions and
better planning
control that will
help organisation
to meet with the
objectives of the
business.
Management
information
system (MIS)
It helps in the tactical
management that helps
in authorising the
computerised financial
information of the
business. Information
is programmed to
produce regular reports
to handle each and
every operation.
Such system helps in operations of
human resources, calculation of
profits, expenses, taxes and other
financial information. This saves
business with problem of excess use
of financial resources and finding
those areas causing deviations in the
business. It helps in delivering
exception that is automatically
generated in occurrence of the
unusual situations or in case
management ask for sudden reports.
Suitable to record
and manages the
activities that are
using financial
resources for
managing the
operations of
Tesco.
Decisions
support
system (DSS)
Set of related computer
programs and activities
are helpful in taking
Sometimes business face issues of
over utilisation of time,
communication problem, threat for
Suitability is
enhanced with
supporting the
8