Functional information system
A functional information system is a system that supports
a functional area in an organization.
Functional areas like accounting, finance, general
management, human resources, etc. are associated
with support activities that include the firm's
infrastructure, human resource management,
technology development, and procurement.
Other functional areas like material management,
operations, marketing, and services are associated with
primary activities such as: inbound logistics,
operations, outbound logistics, marketing and sales, and
Logic of building information systems in
accordance with the organizational
Information systems traditionally have been built
in accordance with an organization’s hierarchy
structure to reflect how information flows up the
hierarchy and how control of data has been
directed down through the organization.
Most of today’s systems have exploited this
structural hierarchy. In some situations, the
functional systems do replicate the processing of
information at various layers of the organization.
Information flow related to sales.
Managing Production/Operations & Logistics
A few of the IT supported POM areas are:
A. In-house logistics and materials management
B. Planning production/operations
C. Computer-integrated manufacturing (CIM)
A. In-House Logistics & Materials Management
Inventory management determines how much
inventory to keep. Overstocking can be expensive;
so are understock conditions (EOQ, Vendor
Manufacturing quality-control systems can be
stand-alone systems or part of an enterprise-wide
total quality management (TQM) effort. They
provide information about the quality of incoming
material as well as the quality of work-in-process
and finished goods.
B. Planning Production/Operations
Material Requirements Planning (MRP) is software that facilitates the plan for purchasing or producing parts, subassemblies, or materials in the case of interdependent items. It integrates Master Production Schedules, BOMs, and Inventory levels.
Manufacturing Resource Planning (MRP II) adds functionalities to a regular MRP system by determining the costs of parts and the associated cash flow. It also estimates costs of labor, tools, equipment repair, and energy while generating a requirements report.
Just-in-Time Systems is an approach that attempts to minimize waste of all kinds (space, labor, materials, energy, etc.) and to continuously improve processes and systems. The JIT concept is used in mass customization and build-to-order environments.
Project Management. A project is usually a one-time effort composed of many interrelated activities, costing a substantial amount of money, and lasting for weeks or years. Software tools such as: program evaluation and review technique (PERT) and the critical path method (CPM) are used to manage milestones, resources, costs, etc.
Work Management Systems (WMS) automatically manages the prioritization and distribution of work. These systems deal with resource allocation and reallocation.
C. Computer-Integrated Manufacturing
• Control Equipment and machinery
• Design new products
• When and quantity of products to produce
• New production facilities
• Generate the work order
Marketing and Sales Systems
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