AVCE Unit 2 ICT Serving Organisations Notes B

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AVCE Unit 2ICT Serving OrganisationsNotes B
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Relationships between departments and external
agencies an example
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Information flow
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Other external agencies

• For example
• Stationery suppliers
• Telephone company
• Utilities companies (water, gas, electricity)
• Local Council
• Accountant
• Auditor
• Recruitment agency
• Inland Revenue
• Insurers
• Advertising agencies
• Bank
• VAT office
• Training organisations

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Sales Order Processing

• Objectives
• To study how a Sales Order Processing System
  works
• To draw an information flow diagram of the
  subsystems involved
• To list personnel involved in processing sales
• To examine the role of ICT in the Sales Order
  Processing System

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Marketing and Sales

• Many manufacturers sell only to the trade, i.e.
  wholesalers or shops. Others sell to both
  individuals and to the trade.
• Marketing department
• Concerned with finding out what customers want
  and promoting these products once they are
  produced.
• Sales department
• Concerned with selling the products.

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How an order is processed

• The Sales Order Processing System and several
  other subsystems are involved in processing an
  order. These may be integrated into one computer
  system.

Information flow diagram of SOP system and
subsystems
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• Placing an order - By telephone, post, fax, via
  a salesman
• The trade are normally given credit and sometimes
  discount for bulk orders.

Inputting the order - Once the purchase order is
received, it is input into the computer system.
Processing the order - In a typical system orders
are entered as they come in and a batch of
invoices printed once or twice a day. These are
sent to the Packing and Despatch department who
pack the goods and enclose the invoice and
possibly send a separate delivery note. Once the
invoices are printed The stock figures are
automatically adjusted by the computer system
The customers record is adjusted to show the
total amount outstanding.
Receiving payment - Statements printed at the end
of each month. Customer pays by cheque or BACS.
Credit Control dept. chase unpaid bills.
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Stock Control

• Objectives
• To learn what is meant by stock control
• To understand the inputs and outputs to a stock
  control system
• To appreciate the role of ICT in maintaining
  correct stock levels

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Holding large stocks of goods

• Advantages
• Will be able to fill large orders so will not
  lose customers
• Often cheaper to manufacture large quantities
• Usually cheaper to buy raw materials in large
  quantities
• Disadvantages
• Capital is tied up in stock
• Costs money to store raw materials and finished
  goods
• The goods may become unsaleable

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Stock control system

• Main functions are to
• keep track of how much of each item is in stock
• record the reorder level and reorder quantity for
  each item in stock (whether this is raw materials
  stock or stock of finished goods)
• generate a reorder report when more stock is
  required

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Inputs to a stock control system

• Addition of new items
• Customer order
• Returns
• Adjustments
• Purchase orders

Outputs from a stock control system

• Various management reports

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Finance and Administration

• Objectives
• To learn the functions of a Finance Department
• To learn the functions of an Administration
  Department
• To appreciate the role of ICT in these
  departments

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Functions of a Finance Department

• Producing budgets
• Producing a Cash Flow forecast
• Looking after the Sales ledger (this keeps track
  of all invoices, credit notes and discounts sent
  to customers and all receipts received from
  customers)
• Looking after the Purchase ledger (this records
  all the companys transactions with suppliers)
• Looking after the Nominal ledger (this affected
  by all transactions posted in all ledgers. It is
  the heart of the accounting system and the Trial
  Balance, Balance Sheet and Profit and Loss
  statement are produced from this)
• Credit control
• Administering and recording payments in and out
• Producing the monthly and annual accounts
• Payroll

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Functions of Human Resources (Personnel)

• liaising with other departments regarding
  staffing requirements
• designing and placing advertisements for new
  staff
• sending out application forms to people
  requesting them
• processing applications
• obtaining references
• interviewing applicants
• preparing induction materials, courses, etc
• keeping personnel records
• dealing with grievances
• dealing with disciplinary matters

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Administration tasks

• general day-to-day running of the company
• building and office equipment maintenance
• implementing and coordinating changes such as
  change of office layout, change of offices for
  individuals, change of company logo, etc
• keeping people throughout the organisation
  informed of changes, events, etc.

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Management Information Systems

• Objectives
• To understand the difference between a data
  processing system and a management information
  system (MIS)
• To see how a MIS can assist management in
  decision-making
• To study the factors influencing the success or
  failure of a MIS

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Information systems v. data processing systems

• Data on items sold is collected by the data
  processing system and stored on a computer file
• An operational information system then reads this
  data and produces a list of items that need
  reordering
• A management information system may analyse the
  sales data to highlight sales trends and use this
  information to plan a new marketing campaign,
  adjust price levels or plan an increase or
  reduction in production facilities.

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The role of a Management Information System
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What managers do

• The 5 classical functions of managers
• Planning
• Organising
• Coordinating
• Decision-making
• Controlling
• Management information systems must be designed
  to support managers in as many of these functions
  as possible, at different levels (operational,
  tactical, strategic) of an organisation.

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Types of decision

• Management decisions can be
• Structured (i.e. repetitive, routine, definite
  procedures)
• Or
• Unstructured (i.e. require judgement, insight,
  evaluation)

Stages of decision-making

• Recognition that there is a problem
• Consideration of possible solutions
• Choosing a solution
• Implementing the solution

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Typical functions of a MIS

• a comprehensive database holding all the
  information about products, customers, suppliers
  and finance that would be needed to provide
  managers with reports for decision-making
• the ability to analyse the information in the
  database to highlight situations that need
  attention
• the ability to show figures over a period of
  time, perhaps in graphical format including
  production and sales figures
• ability to show a snapshot of the companys
  financial situation over a period of time
• ability to perform what-if calculations to show
  what the effect would be of raising production
  levels, hiring more staff, acquiring a new
  building etc.
• warning signals to indicate that decisions are
  required, such as low stock levels, expenditure
  exceeding information, numbers of faulty products
  exceeding expectations
• audio and visual warnings when incoming orders
  exceed production capacity
• daily calculation of productivity levels by
  analysis of costs and output
• monthly graphs of price comparison with
  competitor goods or services resulting from
  regular market research

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E-commerce and Other Applications

• Objectives
• To appreciate the benefits and pitfalls of
  e-commerce
• To describe the advantages of e-mail
• To study other ways in which an organisation uses
  ICT

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Advantages of e-mail

• It is very quick, making it possible to send
  several letters to the other side of the world
  and back in a single day. It is also very
  inexpensive.
• It is possible to attach files containing for
  example text, drawings, photographs etc., to be
  printed out by the recipient.
• The same message can be sent simultaneously to
  several people.

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Using Microsoft Outlook

• Functions include
• Outlook today. Provides an overview of todays
  appointments and To-Do list.
• Inbox. Keeps track of all e-mail and electronic
  faxes. On a network, you can communicate with
  co-workers.
• Calendar. Records appointments. On a network
  using Microsoft Exchange Server, it is possible
  to schedule meetings with co-workers.
• Contacts. All contacts names, addresses, and
  other details can be held, and activities with
  different contacts recorded.
• Tasks. Maintains a To-Do list, and an alarm can
  be set to remind you when an appointment is about
  to come up.
• Notes. Creates reminders that replace
  hand-written notes, which can be left open on the
  Windows Desktop.