MANAGEMENT INFORMATION SYSTEM

INDIVIDUAL ASSIGNMENT MANAGEMENT INFORMATION SYSTEM TOPIC: Question Please show the information application at your workplace; analyze the advantages and disadvantages upon applying the information technology to build up MIS at your workplace Question Do you agree that the application of the information technology (especially building up MIS or more) will create the competitive advantage for your company? Why? Please indicate the example to prove the cases under your experience Question3 Supposing that you have the competence to start MIS building project at your company, please indicate the necessary steps, the natural sources to be prepared and the related parties, which you have to collect in the project? Question Please indicate the function, duty of CIO (Chief Information Officer) in an enterprise? Question5 What you know about ERP (Enterprise Resource Planning) Please draft a ERP establishment plan for your company as a manager to prepare the information strategy for the company? ANSWERS Question The status of the information application at the workplace: KVT company has been established since 2007 with business: manage, operate the gas processing plant, LPG storages, Condensate at Ba Ria-Vung Tau province In the years of 2007 – 2009, KVT does not have any information management system (MIS) but mainly Page of 16 the application of the information technology to serve the information as the individual level; Most of them is to send/receive/ look for the information by file server, email server and handle the documents with Microsoft Office Due to not having MIS , especially the maintenance activities, the maintenance data is stored loosely in each excel file in the personal desktop of the engineers in charge and managers Since 2010, KVT Companyhas established MIS for managing the maintenance activities to the Gas plant, Gas Terminal MIS is on duty of the maintenance, rectification under the name of Maximo – one solution of the maintenance management of IBM Maximo is the complex of 06 occupational groups:  Work Management o Periodical maintenance: Carrying out the maintenance with the fixed frequency o Unexpected maintenance: Carrying out maintenance upon the request for remedy  Materials Management o Managing material code o Managing material export/ import Page of 16 o Managing material stocking o Looking up material information  Asset Management o Managing equipment history o Looking up equipment information  Procurement Management: Not applied  Customer & Service Management: Not applied  Contract Management: Not applied Three management levels using Maximo system are indicated as the figure below After applying Maximo software, KVT has got the following advantages: - Everybody can look up fast the latest data from the system (the inventory information, the information of the maintenance history, information of the maintenance performance) to handle the jobs punctually and accurately Before, it is only to know by telephone or e-mail exchange; If it is the information to be summarized, it will be backward due to the time spending so much for summary/collection - The management level exports immediately the reports related to the management execution maintenance to ensure the plan approved by the level - When there has not been a system before, the maintenance data is stored in each year and cannot the statistic works to analyze the optimizing of the cost for maintenance work and back-up materials to punctually remedy the incidents if any However, with Maximo system available, KVT could the annual statistic work to optimize maintenance - When there has not been Maximo system before, the production department of the company has the trouble when transferring materials for efficient usage Now, with Maximo, the departments have exploited the mutual inventory information to use the inventory materials efficiently Page of 16 - Each staff uses Maximo with the screen for private data access and output of the information is automatically exported Thus, it will be to standardize the work demands and the dossiers are formed - The treating time for each work of maintenance is reduced due to the work reminder system upon coming to that person and saving the history of the work treatment of each staff - The weekly, monthly final accounts and payment of the materials for each periodical and expected work have reduced the dossiers due to the usage of the forms of the reports, the system observation etc Disadvantages when starting MIS for maintenance management: - The big cost for the time and amounts to invest the system, hardware, network, software solution, person’s training and change of the operation procedure of the company - KVT company is troublesome with the legal regulations of Vietnam and of the mother company of the documents, seals, direct signatures Thus, it can not start module of procurement, Customer and Services, Contract causing many legal problems of the functions available of the system - Risk of the network security because it becomes the disadvantages for Hacker to exploit, steal the confidential information - The cost to protect the network security and maintain the function available of the system can increase more than the brought efficiency Thus, as for these 02 aspects, the requirement is too high - Increasing further the work quantity for the staffs in the trial running period, transferring maintenance management system according to the traditional pattern and the new one Hence, it is to require the efforts of the staffs and related departments to shorten this phase In short, the company has currently set up the infrastructure of the information technology, the internal network, devices of information technology etc in the relatively complete manner to exchange the personal information, send the data among the Page of 16 departments in the company and outside MIS system of the company only constructs one part of the work management of maintenance to serve the staffs’ commanding activities at the production departments, the management department and helping the Board of Directors to make punctual and efficient decision of mantenance In addition, due to the state company bound by the current legal regulation, it is impossible to exploit all the functions of the maintenance management system, especially related to the procurement, PO signature, contract etc As for the other operations like the finance, accounting, human resource etc, only the separate software operates independently in the limit of the functional department and of serving the commanding affairs for the related staffs in the room and has not helped the management level to get the punctual, accurate information at each time of proposing the decision and the strategic planning Question2: Do you agree that the application of the information technology (particularly building up MIS or more) will create the competitive advantage for the company? Why? Please indicate the examples to prove the cases under your experience 2a I agree with the concept that MIS will create the competitive advantage for the company because of the following reasons: - MIS will help to collect exactly, fully the information for all operation means of the enterprise and distribute the information properly in accordance with the requirement of each objective and then the management levels will evaluate, adjust or make punctual decision during the operation process and consecutively help the high level leaders to construct/ adjust the tactics, strategies according to each detailed phase or according to each objective of the customers Each employee is closely attached with MIS as a practice Then, the management can understand and adjust the chains of “issues” in the rotating chain of the information treatment to head for the target, the development strategy as proposed - By the information technology systems, the enterprises can quickly supply information of the products, access a new market, looking for the new customers or take care of the customers available better with the low cost At the same time, Page of 16 it can reject the unnecessary costs and can choose the products or the services with the high returns Then, it is to optimize the production, save the cost and optimize the management, execution to increase the competition Therefore, MIS is the important foundation for the new management pattern contributing basically to increasing the business production efficiency of the enterprise improving all-sided and sustainable capacity of the competition of the enterprise in the current globalization and integration 2b Examples of applying successfully MIS in the enterprise: Taking Vinamilk company as an example Before starting ERP: - The input and output goods management procedure is totally manual This has resulted to some consequences like the so much inventories while the output products are consumed too late or the use of machines and workers has not met the capacity etc All of these have caused the damages during the production process of Vinamilk, directly affecting the company profit - In the manual accounts, payment of Vinamilk, it is still to get trouble with the errors, which the staffs encounter With the manual final accounts, the managers of Vinamilk are not easy when checking the final accounts and complying with the procedures - From the reasons indicated above, Vinamilkhas remedied the above efficiently by applying the planning system of ERP Starting ERP a Preparing the infrastructure and manpower: IT Department of Vinamilk has been established with 26 staffs for many groups: Computer supporting group, network group, Server group-database, programming group and Solomon supporting group Vinamilk has cooperated with IBM to set up and start the infrastructure of IT as per the request including the server system under IBM Blade Center System X (running intel Page of 16 processor); The archiving system of SAN of IBM DS8100, capacity of 10TB, ton weight controlled by02 servers of IBM system p- Vinamilkis the first customer of IBM applying this system (only this system has the cost up to 2.5 million of USD); The storage system and application management software b Commencement: ERP application at Vinamilk has, as a matter of fact, spent 03 main stages.On 15 March 2005, ERP system applies the solution of Oracle E Business Suite of Oracle started by Pythisincludingthe main parts of the finance-accounting, procurement management, shopping management –Sale management, production management and analyzing the operation results (Business Intelligence - BI) The technology transfer takes place on the whole Vinamilkwith 13 points including the head office in HCM city, enterprise of stores and branches, plants on the whole country The division of the process will help the company to approach the system more easily Together with the relevant parties to solve the additional issues, it will help the next steps to expand further the scope, applying further the new technologies and mitigating the risks, smoothly and more successfully Vinamilkis currently applying the three solutions consecutively international ERP of Oracle, SAP, and Microsoft The said system has been chosen by Vinamilk for each detailed requirement Thus, it can integrate and master 03 solutions of international ERP and Vinamilkhas proposed the best solutions to settle the business problem c Results: After 08 operation months of ERP for the whole company, Vinamilk has made primary conclusion of the application efficiency The system helps the company to carry out closely against the risk the accounting works; with the clear level and right classification, the finance- accounting work is more convenient compared before The inventory, store management, distribution, enterprise execution, relationship with the customers and production have been managed better by the company in reducing Page of 16 the risk remarkably; Between the sales and distribution, there is more smooth, reflex functions; The observation functions are performed according to the true time The level of IT staff at Vinamilk has been improved IT infrastructure has been consolidated, synchronized, standardized and strengthened It is disclosed by company that since 2002 until now, Vinamilk has invested IT with total cost of million USD (including ERP) and confirms that thanks to the deep investment, Vinamilk has enough energy to access the big solutions As for the organization structure of the company, in addition to the knowledge improvement of the staffs, the system has met the user’s demand well The management becomes concentrated, thorough, punctual Right when starting successfully Microsoft Dynamics SL, Vinamilk has concurrently proposed ERP and the sales solution by PDA for the distributors to strengthen the management level There have been 33 distributors (NPP) of Vinamilk in the whole country starting ERP-PDA The project was completed to the end of the year 2007; This amount will increase 78 NPP Vinamilkhas started Microsoft Dynamics SL and Palm Z22 for 10 NPP in Hanoi and 23 NPP in HCM city Other sixteen NPP in Mekong Delta River are in the complete phase for installing the software As scheduled, at the end of this year, Vinamilk will complete the software for 78 NPP and to July 2008, it will be 187 NPP The network of NPP of Vinamilkwill continue to expand Evaluation: a Difficulties : Although Pythisis an enterprise specializing in supplying the software solutions in Vietnam, the capacity to meet Pythis for the whole process of ERP of Vinamilkis insufficient It is possible to see that as the top supplier, Pythis’s human resource, technology and capacity are limited The level of Pythis can be the strategic partner of Oracle in Vietnam However, in order to develop completely the whole capacity of Oracle at one big enterprise like Vinamilk, it is impossible Thus, Vinamilk buys the software solution of Oracle and SAP to complete more the technology capacity at the high level It is possible that Vinamilk wants to buy the Page of 16 solution of Oracle for the core management capacity and CRM (Customer Relationship Management) alone of SAP to strengthen the customer’s management capacity at the highest level At a way yes level, the functions of ERP of Oracle at CRM have not been developed It is partly due to the qualification, insufficient manpower (it is mainly caused by Pythis) This has enabled the cost for ERP at Vinamilkto increase once more time At the same tie, the synchronizing capacity for the management process of the solutions is remarkably reduced The data input from the customers and suppliers is by the manual inputting system from the occupational staffs receiving the documents of the partners’ professional staffs Thus, there will be delay and inaccuracy The cost to invest ERP and put it into the complete operation is relatively big not only about the software qualification, hardware but also the manpower capacity The hardware system needs to be invested so bigly to run all modules The software system has to be updated usually for the latest versions applied for the best management When the hardware system and software can be procured, another issue is mentioned as an important and key one That is the qualification, manpower available to use that system The investment for the manpower is not one or two days but the long process Vinamilk wants to use ERPsystem, it does not only make investment for the infrastructure but also attaches importance to the qualified workforce to start the system This workforce does not master the general condition of Vinamilk, but have enough ability to run the system So, Vinamilk has to train the qualified workforce to use the system and also let its staffs practice on the true system to accumulate the experience for reaching the highest efficiency upon using the system Development of CRM and distribution for the vendors are the modules different from the modules in the core central as bought by Vinamilk The occupation has been reached far to control the market, the sale staff’s qualification, the competitor’s competition etc This is too strange to the staffs and consultants to start ERP usually In addition, the special feature of Vinamilkis applying consecutively three solutions international ERP of Oracle, SAP, and Microsoft Thus, the know-how to combine the three solutions efficiently is a challenge Page of 16 b Reason for the success: As for the strong commitment and support of the management board Vinamilk–right orientation and to the end –Vinamilk has assigned the professional workforce to join actively the professional IT workforce project of Vinamilk working basically and methodically In addition, the project is supported by the production management system ofVinamilk, of the supplier of Oracle and the independent consultant of KPMG Co.,ltd The main experience shared by Pythis is that the relevant parties (Pythis, Vinamilk, Oracle and even KPMG) together define clearly the target but does not go into the details of the non-important issues so much, concurrently showing the person to handle the additional issues Question Supposing that you have the competency to start MIS establishment project at your company, please indicate the necessary steps to be done, the source to be prepared and the related parties which you will collect in MIS establishment project? 3a Necessary steps: According to me, there are three major steps: - Setting up the professional group including the representative of the company departments (in which IT department in charge of the company is the key one) and the team leader shall be a Vice Director to make jointly consultancy - Surveying, evaluating the status of the information status in the company including hardware and software to define the existence and inadequateness - Determining MIS system scope in accordance with the demand, target and the ability of the company It is to make reference to MIS models of the company operating at the same applied business branch - Evaluating and choosing suitable MIS solution of the supplier; understanding the weakness and strength of the supplier to choose the solution in accordance with Page 10 of 16 the company;It is to consider the factor of the human beings, the bindings of the current legal regulations, the existing procedures upon applying for each solution - Preparing the plan to start the solution; separating each phase to ensure the enterprise (the human being, the commanding procedure, infrastructure system), converting/ adjusting it according to the target of the starting phase At the same time, it is to train and use the whole levels in the company and set up the procedure how to use it, exploit - Starting the plan according to each phase; evaluating the results after each phase for the proper adjustment - The group in charge has to observe the exploitation and use of MIS system when completing it in the whole company to get the adjustments, system updates, updating the commanding procedure, instructions for use 3b Natural resource, workforce and relevant parties: - Determination: MIS system will improve the management level and competitive ability for the enterprise However, the construction and start are quite complicated in the current Vietnamese context Therefore, it is to get the determination and consent of the whole company, especially the punctual care of the highest management level avoiding the whole assignment for IT department The very application of modern MIS system will break the old habits, working patterns together with the data/information which is not updated, not systematical and transparent etc This will cause the psychology for employees, especially the persons advanced in years and limited in the ability etc They think that when the new system is applied, their jobs can be affected; the shared information will impact on the personal interest - Finance: MIS establishment needs a big amount for investment (hardware, software, training, start etc) which can impact on the temporary business efficiency or the profit of the enterprise Due to the brought efficiency, we have to consider it as the investment not the cost Thus, before getting the plan to commence, it is to prepare a source of the budget and the company annually needs a budget for maintaining MIS system efficiently Page 11 of 16 - Consultant: Choosing the experienced consultant for setting up MIS, understanding the Vietnamese law and mastering the challenge in the business operation activity of the company especially in the very competitive context and tendency of the globalization - Solution: Together with the consultant, selecting the suitable, optical solution in accordance with the scope, target, development orientation of the company and getting the reliable and stable operation; getting qualified to update, adjust or widen it according to the company organization - The human being: including all the management levels, the departments, related production sections to contribute for the project The project is constructed to facilitate the enterprise job Therefore, in addition to the group in charge upon commencement, the mobilization, efforts of the departments, production sections contribute to the ideas, setting up the actual, suitable procedures to help the project better with the higher feasibility - IT infrastructure: To maintain the information technology infrastructure synchronously and upgrade timely during the usage to make suitable with the quick development of technology Question Please indicate the function, duty of a CIO (Chief Information Officer) in the enterprise : Chief Information Officer (CIO) only appears in the moderate and big sized companies; CIO has the true meaning of converge 01 high level leader, 01 information source, 01 market analysis, 01 business strategist and a technologist - High level leader: o Managing and sharing the information natural resource with the other departments; o Managing the solutions and contract negotiation - An information source : o Collecting and distributing information ; o Searching the new development projects o Observing the competitive competitors Page 12 of 16 o Supplying valuable information for preparing the strategy, development plan and professional process - An IT market analyst : o Helping CEO to understand the new technology in the market which can apply for the enterprise - A business strategist: o Developing IT plan in accordance with the development strategy of the enterprise o Defining and exploiting the new opportunities ; o Facing and settling the new challenges ; - A technologist: Mastering the technology development orientation of the world to orientate the development, adjust IT system of the enterprise Therefore, CIO has the following function: Leading information technology activities and also the representative for this field of the enterprise; constructing the development strategy, the policy, the plan of applying information technology for the enterprise and linking IT and the management, execution of the enterprise to improve day by day the efficiency for the enterprise - CIO’s responsibility: +Guiding to construct and develop the strategy, plan of applying the information technology to meet the development strategy of the enterprise, improving the ability of the staffs in exploiting, applying the information management system; setting up the policies, procedures and standard of IT including hardware, software, security issues, confidentiality and improving the professional procedure, managing the information system natural resource Constructing the regulations, guiding the technical management, IT application; + Joining IT with the trade work to ensure the growth and renovation for the enterprise; + Ensuring the thorough qualification in constructing, applying the information management system suitable to the development strategy of the enterprise +Setting up the high quality IT specialist for the enterprise and getting the inheritance Page 13 of 16 As a matter of fact, for the Vietnamese enterprises, I have not got the position of CIO but it is cum work in charge assigned by General Director Thus, the said duty has not be developed as desired This position only exist at the big foreign corporations Hope that in the coming time, the state, private groups of Vietnam will get the position of CIO in the chart of company mechanism 5.Question 5:How you understand ERP (Enterprise Resource Planning).Please draft an establishment plan ERP for your company as the information manager, strategist for the company? ERP is the application system integrated with many functions to help the enterprise to manage the workforce and execute the professional command The solution of ERP supplies the enterprise managers to manage and execute the finance –accounting, material management, the production management, trade management and product distribution, customer management, human resource management, forecasting tools and planning, reporting etc ERP solution will supply the enterprise with a management system with the modern procedure according to the international standard to improve the management, execution ability of the enterprise for the leader as well as the staffs’ professional commands ERP is the combination of many kinds of IT system; note that each IT forming ERP has to operate well at his scope ERP is the strategist management tool at the highest level; it usually appears at Corporations with many subsidiaries operating with the different occupations Drafting the ERP planning of the company: Defining the professional works of the departments/ subsidiaries against the mutual cross jobs Selecting ERP solution of the supplier suitable to the qualification and development scope of the company Developing and completing ERP system with Finance-Accounting and human resource management as a the basis for the other departments for development (the production management, maintenance and rectification, project management, project management; service management, reporting etc) Defining the options to be managed to each subsidiary and then empowering each subsidiary to develop the department related to the function under the selected ERP solution The sub-system is detailed below: Subsidiary/department as a trade role: Page 14 of 16 • Selling goods and managing customers • Procuring and controlling the suppliers Subsidiary/ department as a production role: • Production plan • Controlling non-conformance quality, products; • Delivering and receiving products; • Managing accessories, inventories … Connecting all started sub-systems with each other and completing sub-systems of planning –Estimate Exploiting ERP system and adjust the system according to the development level of the company My outline plan to build ERP in enterprises is shown in the following diagram: Notes: - Choosing ERP solution with SOA architecture and Web interface - Setting up IT workforce strongly to master ERP solution to serve the operation, adjust the system when put into operation ; - Getting the high determination, support of the highest management level and the participation of the all departments when commencement Page 15 of 16 In addition, it need to collect all initial information, reference the same size project to prepare the estimated cost, around 800,000 USD – 1.000,000 USD and allocation for the following sections: +The cost of hardware and network infrastructure: About 10% +Cost for the software copyright: Approximately 25% +Engineering & execution cost: Approximately 42% +Training, document: Approximately 5% +Maintenance service, supporting fee for annual software and other costs: 18% References: - Management Information Sytem Course, Dr Ho Bao Quoc Vinamilk IT report Maximo Enterprice catalogue CIO Success website http://thehigheredcio.com Website http://www.cio.com/ - THE END - Page 16 of 16 ... up equipment information  Procurement Management: Not applied  Customer & Service Management: Not applied  Contract Management: Not applied Three management levels using Maximo system are indicated... execute the finance –accounting, material management, the production management, trade management and product distribution, customer management, human resource management, forecasting tools and planning,... server system under IBM Blade Center System X (running intel Page of 16 processor); The archiving system of SAN of IBM DS8100, capacity of 10TB, ton weight controlled by02 servers of IBM system