Chapter 16 Information and Operations

16- 2 Management 1e Management 1e - 2 Management 1e Learning Objectives  Explain how managers use controls to operate organizational performance  Describe the different forms and types of information technologies that managers apply  Illustrate how managers use information and technology systems to create efficiencies and make more effective decisions  Identify the types of controls and the processes used by managers to measure and adapt organizational performance  Describe how managers effectively apply controls to influence performance, with both people and results

16- 3 Management 1e How Controls Make a Difference (p. 400)  Control Tool that helps managers use information to influence behavior and affect operational performance through greater efficiencies and effective decision making Permits managers to oversee and direct employees toward achieving organizational goals Regulates behavior and results around specific areas within the organization Should not be too rigid Lack of control can lead to demise of the organization

16- 4 Management 1e How Controls Make a Difference (cont.)  Types of controls (p. 401) Standards – models and examples of how items or tasks are expected to be executed Preliminary control (planning control) – control used as a preventative measure to clarify potential deficiencies before they occur  Corrective action taken before problems arise Screening control (real-time control) – control used to take corrective measures based on feedback during a process should barriers arise Post-action control – control used to assess results after a process is complete in order to provide information for future planning (p. 402)

16- 5 Management 1e Information, Technology, and Systems (p. 402)  Information technology Development, maintenance, and use of computer systems, software, and networks for the processing and distribution of data  Types of information (p. 403) Knowledge – information gained by an individual or team that is internalized  Knowledge worker – employees who are known for the specific skills they possess, such as technology

16- 6 Management 1e Information, Technology, and Systems (cont.)  Organizing information using technology and systems (p. 403) Firewall – software program designed to protect against unauthorized entry into a particular information system or personal computer Extranet – system that is similar to the internet but used primarily within a company for its employees or vendors

16- 7 Management 1e Management Information Systems (p. 404)  Management information system (MIS) Tool that aids organizations to run more efficiently by incorporating people, technology, and information systematically  Enterprise resource planning (ERP) System that provides a flow of information to include accounting, manufacturing, customer relationship management, sales, and service Everyone able to see how one action carried out in one area can affect another part of the organization

16- 8 Management 1e Management Information Systems (cont.)  Executive support system (ESS; p. 405) Management information system that uses internal and external data to aid the executive staff with their decision- making process with regard to organizational performance Executives can view data instantly rather than waiting for monthly reports  Decision support system (DSS) Computer-based information system that helps organizations with their decision-making process  Artificial intelligence Software system that gives computers the ability to seemingly possess human intelligence and act accordingly to process information

16- 9 Management 1e Information and Controls for Operations (p. 406)  Types of controls Controller – chief accounting officer within an organization that helps control finances Financial statement – summary that lists the revenue and liabilities for a company during a particular time frame (p. 407) Balance sheet – financial statement that lists revenue, assets, and liabilities for a company during a particular time frame

Management 1e Information and Controls for Operations (cont.)  Types of controls (cont.) Income statement – summary of revenue gained during a specific time period, usually listed by month (p. 407) Ratio analysis – quantitative study of a company’s financial statements within a particular collection of data Audit – formal examination of a company, department, or individual’s accounts or financial standing (p. 408) Budget – document used to predict revenues and expenditures during a certain period for financial forecasting

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