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Chapter 2 Global E-business and Collaboration 75

What at first appears to be a simple process, fulfilling an order, turns out to
be a very complicated series of business processes that require the close coor-
dination of major functional groups in a firm. Moreover, to efficiently perform
all these steps in the order fulfillment process requires a great deal of informa-
tion. The required information must flow rapidly both within the firm from one
decision maker to another; with business partners, such as delivery firms; and
with the customer. Computer-based information systems make this possible.

HOW INFORMATION TECHNOLOGY IMPROVES
BUSINESS PROCESSES

Exactly how do information systems improve business processes? Information
systems automate many steps in business processes that were formerly
performed manually, such as checking a client’s credit, or generating an invoice
and shipping order. But today, information technology can do much more. New
technology can actually change the flow of information, making it possible for
many more people to access and share information, replacing sequential steps
with tasks that can be performed simultaneously, and eliminating delays in
decision making. New information technology frequently changes the way a
business works and supports entirely new business models. Downloading a
Kindle e-book from Amazon, buying a computer online at Best Buy, and down-
loading a music track from iTunes are entirely new business processes based on
new business models that would be inconceivable without today’s information
technology.
That’s why it’s so important to pay close attention to business processes, both
in your information systems course and in your future career. By analyzing
business processes, you can achieve a very clear understanding of how a
business actually works. Moreover, by conducting a business process analysis,
you will also begin to understand how to change the business by improving
its processes to make it more efficient or effective. Throughout this book, we
examine business processes with a view to understanding how they might
be improved by using information technology to achieve greater efficiency,
innovation, and customer service.

2.2 TYPES OF INFORMATION SYSTEMS

Now that you understand business processes, it is time to look more closely
at how information systems support the business processes of a firm. Because
there are different interests, specialties, and levels in an organization, there are
different kinds of systems. No single system can provide all the information an
organization needs.
A typical business organization has systems supporting processes for each of
the major business functions—sales and marketing, manufacturing and produc-
tion, finance and accounting, and human resources. You can find examples of
systems for each of these business functions in the Learning Tracks for this
chapter. Functional systems that operate independently of each other are
becoming a thing of the past because they cannot easily share information to
support cross-functional business processes. Many have been replaced with
large-scale cross-functional systems that integrate the activities of related
business processes and organizational units. We describe these integrated
cross-functional applications later in this section.

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