CS507 - Information Systems - Lecture Handout 12

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CBIS from Functional View Point

CBIS can be divided into subsystems based on how the users are grouped in the organization. This grouping of users is in terms of related tasks that are performed. These conceptual systems are mirror images of physical systems that are present. These systems are collectively called Organizational Information systems (OIS).

Organizational Information Systems (OIS)

The term OIS views organization as a combination of process oriented groups whose information needs are related but independent. All functional systems should work together for problem solving since each system specialises in specific domain of information.

Organizational Information Systems (OIS)

Marketing Information Systems (MKIS)

MKIS is a type of Information System that helps the firm to achieve following objectives:

  • Identification of customers for firm‘s products and services.
  • Development of those products and services to meet customers’ needs
  • Promotion of the products and services, and
  • Provision of after sale customer support

Types of Marketing Information

Every information system is designed to capture some sort of information. Information requirements need to be defined before the systems are made. While designing marketing information system, following types of information should be designed.

  • Marketing Intelligence – information flowing from environment into the environment
  • Internal Information – gathered within the firm
  • Marketing Communication – Info flowing from firm to external environment An MKIS help in proper management and dissemination of all three kinds of information.

Benefits of Marketing IS

MKIS helps organizations in efficient channel management. Following can be identified as some of the benefits of MKIS.

  1. Customer profiles need to be maintained focusing on their habits and spending patterns. MKIS helps in maintaining these profiles.
  2. Information on what competitors have been upto is also a critical marketing information. This should not be taken as espionage on competitors.
  3. Forecasts of demand is also a critical part of marketing analysis. MKIS helps in achieving this as well.
  4. Field sales can also be monitored where sales agents are used to market products.
  5. Customers can be quickly updated based on their information kept in MKIS.
  6. Dealers involved in sale of product can also be monitored to help enhance revenue.s

Management Levels in MKIS

MKIS should cater for information requirements at each level, for instance

Strategic Level

  1. Formulation of new sales products, and identifying new sales opportunities.
  2. Planning support for new products and services
  3. Monitoring competitors

Knowledge Level

  1. Market analysis based on demographics and customer behaviour

Management level

  1. Sales performance analysis is required to monitor how to enhance sales and address related issues.
  2. Sales staff analysis is important to see how much of the sales portion has been contributed by each of the employees.

Operational Level

  1. Taking comments from customers for measuring satisfaction is a responsibility of the managerial level.
  2. Tracking sales, processing orders and customer support

New Dimensions in MKIS

Through extensive use of computers in marketing field, newer concepts are emerging in marketing field, which are revolutionising the way customers were dealt with.

  • Customer Relationship management (CRM)
  • Sales Force Automation (SFA)
  • Call Centres

Customer Relationship Management

  • Businesses increasingly talk about fostering relationships with their customers. This is important because some modern businesses have literally millions of customers. Hence keeping personal touch with every individual customer is getting difficult to achieve.
    • Companies are clearly eager to nurture relationships with their customers. Businesses need to understand the extent to which consumers want to engage with their brands. For some businesses there is
      • Either a strong natural need – banks
      • Or an emotional attachment – Fashion retailer, car manufacturer

Benefits of CRM

  • Maintains and enhances customer base
  • Encourages customer loyalty
  • Gaining more customers’ wallet-share
  • The more effective a company's customer retention and defection management strategy, the less they need to plug the gap with new customers, who are expensive to recruit.
  • CRM help in establishing communication to encourage customers to share information about their
    • Habits,
    • Tastes and preferences
    • Interests in Co’s brand extension initiatives
  • CRM is a business strategy that goes beyond increasing transaction volume.
  • Its objectives are to increase profitability, revenue, and customer satisfaction.
  • To achieve CRM, a company wide set of tools, technologies, and procedures promote the relationship with the customer to increase sales.
  • Thus, CRM is primarily a strategic business and process issue rather than a technical issue.

Reasons for adopting CRM

  • Customers now prefer to execute transaction in an electronic environment through online-trading.
    Also the establishment of customer services centers has also removed the inconvenience to access vendor’s physical locations.
  • Due to absence of physical contact, companies are curious to keep a soft touch in an efficient manner.
    This requires keeping a customer-wise online track of past correspondence and transactions.
  • CRM reduces cost of sales and distribution by
    • Targeting advertising to customers to increase the probability that an offer is accepted.
    • Using web applications to decrease the number of direct sales people and distribution channels needed
    • Managing customer relationships rather than manage products (a change in marketing)
  • CRM minimize customer support costs by
    • Making information available to customer service representatives so they can answer any query
    • Automating the call centre so that representatives have direct access to customer history and preferences and therefore can cross-sell

Key CRM Tasks

  • Customer Identification -- Identifying customer through
    • Marketing channels,
    • Transactions,
    • Interactions overtime,
  • Customer Differentiation – Segregating customers, with respect to.
    • Their lifestyles
    • Attitudes
    • Perception about Co.’s products
  • Customer Interaction – Efforts made to retain customers for long-term profitability and relationship.
  • Customization / Personalization
    “Treat each customer uniquely” is the motto of the entire CRM process. Through the personalization process, the company can increase customer loyalty.

CRM Issues

  • Customer Privacy
    Customer privacy is an important issue in CRM. CRM deals with large amounts of customer data through various touch points and communication channels. The individual firm is thus caught in an ethical dilemma – collecting as much information as possible but still respecting limits for personal privacy.
  • Software issues
    There is little standardized technologies and protocols for CRM implementation in the market.
    Vendors publish new versions of CRM software as frequently as they can thus adding to client’s expenses. CRM software requires highly integrated environment for high productivity, which is rarely available.

Sales Force Automation

It automates some of the company's critical sales and sales force management functions, for example,

  • Customer account management,
  • Forecasting sales,
  • Sales administration,
  • Keeping track of customer preferences,
  • Sales staff performance.

SFA empowers the sales force to close deals at the customer’s office and to configure marketing strategies at home. SFA is providing tools for very highly evolved sales organizations, organizations that are basically marketing machines.

Call Center

Due to its direct contact with customers, call center is widely gaining popularity. It refers to a department within a company or a third-party organization that handles telephone sales and/or service. Call centers use automatic call distributors (ACD’s) to route calls to the appropriate agent. In addition to a call centre, collective handling of letters, faxes, and e-mails at one location is known as a contact centre. As computers gain more and more involvement in marketing field, presence of a highly efficient and integrated call center has become inevitable. Call centers should have direct access to every customer’s track record so as to help them handle queries in an efficient manner. Modern day call centers, record the telephonic conversation with the customers, extract a summary of it, and display it every time the customer calls so as to help attendant review entire record.

Call Center-Challenges

Call centre agents are challenged daily to navigate disparate, non-integrated applications as they attempt to resolve customer service requests. The call centre should offer an integrative solution so that customers can be responded efficiently. Call canter should help cut long processing times which add to customer frustration and dissatisfaction with the company.

Manufacturing Information Systems

It is an information system which deals with the

  • Planning, development and maintenance of production facilities
  • Establishment of Production goals
  • Availability of production materials
  • Scheduling

Management Levels in Manufacturing Information System

Strategic level

  1. Locating new plant which can save cost
  2. Investment in new manufacturing technology

Knowledge Level

  1. Distribute knowledge to drive the production process
  2. Innovating new forms of manufacturing processes

Management level

  1. Monitoring production costs and resources

Operational Level

  1. Status of production tasks