Management Information and Communication System - Essay Example

?Management Information and Communication System Enterprise systems (ES) are large scale application-software packages that entail enterprise resource planning (ERP) software, customer relationship management (CRM) packages, and supply chain management (SCM) packages from vendors like Oracle, PeopleSoft, and SAP (Goyal, 2006, p.2-8). Enterprise Systems manufacturing companies are generally medium sized businesses with a large product mix The ES use recent information technologies to support various organizational functions, processes, reporting, data analysis and information flows (Shang and Seddon, n.y, p.1-3). The information technology applications in this case encompass computational, data storage, and data transmission. Ideally, an enterprise system defines a total view of all functions and sub-systems of the entire organization. Subject to their application, Enterprise Systems can significantly change the way an organization functions. Indeed, there are variant business advantages and disadvantages of the adoption of Enterprise systems in an organization setup. Advantages of Enterprise Systems Enterprise systems encourage the flow of information in an organization, improves coordination, decision-making, and efficiency through integrating the organization’s production, sales, logistics, finance, and human resources into a single software system. Indeed, the ES helps in the creation of a uniform organization and setting up of organization-wide performance standards. Through the coordination initiated by the ES in an organization, the firm is able to respond to customers’ demands more rapidly. Actually, the adoption of ES in an organization leads to the incorporation of best industry practices that foster improved performance in an organization. They equally lead to improved quality and reduced delivery times in developing efficient high customer satisfaction subject to the easier access to requisite information by all organization members. Indeed, ES constitutes reliability and integrity of the data that eliminates valuable time spent in reconstructing lost data, managing changes between interfaced systems, and validating the transfer of information (Keats,2001, p.1-2). Moreover, the ES promotes faster and improved collections through fewer billing and delivery errors and improved visibility into accounts. The accounting applications of the ES are the most significant merits of an ES in that there is integration of cost, profit, and revenue information of sales that are presentable through granular way (Shang and Seddon, n.y, p.1-3). The ES entails Enterprise Resource Planning that has significant impact on the manufacturing process. Additionally, the management is able to make better plans in the organization via the consolidated picture of inventory, sales, and receivables presented by the ES. The adoption of the ES results to a reduced inventory cost due to the incorporation of SCM, CRM and ERP concepts that aid in better planning, follow-up and forecasting of requirements. The ES considerably enhance improved interdepartmental communication and better employee performance because of proper sharing of information across all departments of an organization. The ES also serves as a barrier to the entry of redundant data and processes throughout the system as all systems are integrated in an organization. However, the Enterprise systems entail a lot of challenges and demerits. Disadvantages of Enterprise Systems There are problems associated with delivering flexibility that emanate from the ES manufacturing companies being forced to respond to fast changes in customer requirements and technology which subsequently leads to huge demands on the flexibility of supply chain systems. In addition, ES suffers software complexity issues. This is due to the increased configuration complexity where the hardware, operating system, database and storage, and applications are hard to operate. Another disadvantage attributes to the difficult in optimal servicing of the installed equipment base and the challenge in supporting and warranting and servicing the ES in an organization (Goyal, 2006, p.2-8). Though the ES is very beneficial, the cost of ERP Software, configuration, planning, customization, testing, implementation significantly high for many medium sized businesses. Additionally, operations of an ES require experienced employees in information technology. This calls for immense training, which is equally costly to afford. Additionally, where customization is involved, little of it may not integrate the ERP system with the business process while the excess of it may slow down the project and makes it difficult to upgrade. Moreover, different organizations apply various ES systems and hence it is challenging to create an enterprise system to the company's preferences. As a result, organizations through their employees may spend a lot of valuable time on programming or talking to the enterprise system's technical support for purposes of meeting customer's demands. Similarly, where the participation of users is very important in the implementation of an ERP, it requires abject training to achieve this, which is mostly very hard to learn and subsequently use. It is equally hard to integrate ERP systems with other software systems hence difficulties in transferring existing data to the new ERP systems. At the same time, once an ERP is adopted it is usually very hard to implement customizations and further upgrades as the entire ES is put under a single vendor lock-in. Indeed, it takes a long time to deploy an ERP and get it into full operation. It also takes a longer time to realize and measure the cost savings after the adoption of an ERP. Additional costs like new IT infrastructure and the upgrading of the WAN links accrue to the adoption of an ES. Most significantly, it is logistically hard to implement ERP implementations in a decentralized organization. Supply Chain Management Systems Supply chain management can be defined as “the physical, financial and information networks for the logistic movement process of materials, funds, and related information. It starts from the acquisition of raw materials to delivery of finished products to the end user. Participants of supply chain include all vendors, service providers, and customers.” (State of Victoria, 2004, p.1-6) It involves coordination and integration of product flows in the company and from the company. The main aim of Supply chain management is to create a supply with reduced inventory where timely delivery of products is guaranteed. It has an ultimate goal of coordinating all functions and strategies, throughout a company, and across businesses for purposes of improving the performance of all stakeholders. As such, the process of initiating and implementing any supply chain management systems requires detailed knowledge on information technology. Indeed, remote diagnostics through logistics software raise the efficiency and integrity of supply chain's operations. Logistics management software runs remote diagnostics where there is automation of workflow, and provision of information necessary in detecting bottlenecks and problems associated with a reference supply chain. Logistics management software is significant in creating reports that seeks to improve transportation lines, ordering amounts, and maintain stocks. Logistics software suite can produce flow casting that links real-time consumer demand to parts of the retail supply chain thus defining the flow of products in a supply chain. As such we can reduce costs and increase profits by streamlining a supply chain using the supply chain management systems. However, it is worth noting that different organizations use different supply chains and hence the success of variant supply chain management systems varies from one organizations to another. Supply chain management systems defines the yearly sales, actual units sold, purchases, cost production, logistics management software with an aim of improving performance (Business Link, 2012, p.1). Therefore, supply chain management systems are very fundamental in a business as they highly give an organization competitive advantage in the market. Hence, upon adoption, supply chain management systems attract numerous benefits to a business. Indeed, through the supply-chain management systems the supply chain and the customer order processing feature in a transparent manner. In addition, the supply-chain management systems streamline business processes by computerizing all operations in the supply department. Actually, supply chain management systems in collaboration with the internet are significant in speeding up communication between partners and suppliers. Additionally, they facilitate a faster and accurate delivery of orders. Similarly, supply-chain management systems lead to a better response to unforeseen events hence placing an organization in a better position to serve customers under all circumstances even during emergencies. Due to their better visibility, supply chain management systems lead to improved planning and scheduling capabilities. More so, they guarantee reduced administration costs, reduced costs for logistics, warehousing and manufacturing, due to better planning and electronic delivery (State of Victoria, 2004, p.1-6). Their adoption equally leads to improved customer service, because of effective order tracking and automated messaging. There is considerable improved decision-making and fewer data errors due to availability of requisite information. More significantly, through the information sharing between different participants of supply chain, supply chain management systems lead to better collaboration on planning. Indeed, the computerization of business processes saves on time and money (Business Link, 2012, p.1). In conclusion, I find that enterprise systems have fundamental impact on the management of any organization. They are involved in organizational functions, processes, reporting, data analysis and information flows. Though they are more technical and costly, the benefits of enterprise systems supersede the demerits of enterprise systems upon adoption in an organization. On the other hand, supply-chain management systems draw a huge significance in the business environment. They relate to coordinate planning, production, and logistics with suppliers. Their application in the business generates numerous benefits to the reference business. However, Supply chain management systems do not apply universally in different businesses. Works Cited Business Link 2012, Supply chain software, Web 12 may 2012, Goyal, J 2006, Challenges To Enterprise Systems Manufacturers, Web 12 may 2012, < http://www.oracle.com/us/industries/high-tech/022563.pdf> Keats, J 2001, Enterprise Systems Advantages, Web 12 may 2012, < http://www.dekkerltd.com/library/mrktg010822w_enterprise_system.pdf> Shang, S and Seddon, P n.y, Enterprise Systems Benefits: How Should They Be Assessed, Web 12 may 2012, < http://nccur.lib.nccu.edu.tw/bitstream/140.119/26469/1/S25-004.pdf> State of Victoria 2004, Supply Chain management, Web 12 may 2012, < http://www.mmv.vic.gov.au/Assets/262/1/SupplyChainManagement.pdf> Read More