Management Information Systems - Essay Example

? Comparison and contrast of Wal-Mart and Coca-Cola management information systems Grade (5th, Nov. Comparison and contrast of Wal-Mart and Coca-Cola management information systems Management information systems refer to the technological systems that an organization applies, in order to gather the information needed by an organization, to run and manage its operations effectively (Lucey, 2004). The major reason for any organization requiring to have a management information system, is to enable the company continuously access and utilize the accurate and up-to-date information regarding the fundamental aspects of the organization performance, as well as information regarding its environmental factors (Wailgum, 2007). It is through obtaining such information, that the management of an organization is therefore able to improve its decision making capabilities, since it can now base its decisions on the accurate information regarding the company’s internal and external environmental factors. The major distinction between Management information systems and the other forms of information systems is that the management information systems enables an organization to analyze the organizational operational activities, and thereby facilitate strategic choices for the company, owing to the consideration of both the internal and the external factors influencing the organization’s operations (Lucey, 2004). The major benefit associated with the implementation of a management information system within an organization, is to improve the efficiency and effectiveness of the organization, through the identification of the strengths and weaknesses of the organization, and then strategizing on how to overcome the weaknesses, and planning on how to capitalize on the areas that the company has demonstrated strengths, to be able to overcome the challenges posed by the organization’s operating environment, as well as the major threat of competition (Lucey, 2004). Management Information systems used in Wal-Mart Wal-Mart is the leading global retailer, which has a massive network of retail stores. Therefore, the organization requires a robust Management Information System, to enable it cater for all the information needs of the organization, from within and also without the operational environment of the organization (Wailgum, 2007). The management information systems used in Wal-Mart are based in the information department, which comprises of a hierarchy of information specialists, who assists in the collection, analysis, interpretation and distribution of vital information regarding the organization and its internal as well as external environment, for the subsequent decision-making by the organizations top management. After the management accesses the gathered and interpreted data and information, it then plans for the subsequent implementation of the necessary actions to ensure that the business is able to overcome the challenges it faces, while capitalizing on the identified areas of its strengths (Wailgum, 2007). Thus, the Wal-Mart information system comprises of a senior systems information analyst at the top of the hierarchy, who is assisted by the business systems information analyst who is the second in command, followed by the senior business information manager, who is in turn subordinated by the relevant sectional information managers, assisted by supervisors, and then the employees at the levels below (Wailgum, 2007). The whole department is under the leadership of the Executive Vice-President of the organization, who is also the Chief Information Officer. The organization has established a data collection and storage system based at the Jane Data Center, which has a massive capacity of 460 terabytes, enabling the organization to collect varied forms of information from within the organization and its external environments, for the purpose of storing such data and eventually analyzing it to enable the organization make informed decisions regarding its operations, as well as device the relevant strategic moves, to counter the unfavorable environmental factors that could face the organization (Wailgum, 2007). Management Information systems used in Coca-Cola Coca-Cola is the global leader in the world of beverage and soft drinks production and distribution, which operates in over 200 countries in the world (Weerakoon & Husain, 2011). Following this massive distribution network, it is inevitable for the company to have a robust information system, which then helps the organization to cater for all information needs, from both within and outside the operational environment of the organization. The initial Management Information System applied by Coca-Cola was referred to as the Legacy System, which was later found to be inefficient, due to its inability to sustain the collection, storage and analysis of huge data that is the characteristic information need of the organization (Weerakoon & Husain, 2011). Due to the weaknesses associated with the Legacy Information system, which did not allow for the computerized processing of financial information, requiring that such information be processed manually and the records submitted in hard copies, an alternative management information system was sought, which would allow the company to gather, store, analyze and process, as well as update the financial information of the organization. Consequently, the Strategic Enterprise Management (SEM) system was found to be the most appropriate for the company, and it was adapted to fulfill the information needs of the organization (Weerakoon & Husain, 2011). Comparison between Wal-Mart and Coca-Cola use of information systems to help manage internal operations and to make decisions Centralization A key aspect of both the management information system of Wal-Mart and Coca-Cola is that; the two organizations have adopted a centralized system, which enables them to track the movement of their products throughout the different regions and countries in which they operate, from a centralized location (Lucey, 2004). Both Wal-Mart and Coca-Cola have devised a centralized scheme of operations, where the vital information regarding the brands, demand, supply and distribution needs, as well as the competitive strategies of the organizations are developed from a centralized location of the organizations, and then the strategies redistributed throughout the global outlets that the organizations have. The centralization of such operational strategies serves to ensure that both organizations have all their global outlets reading and operating from the same script, to create and enhance the uniformity of the products supply and distribution of the organizations brands, throughout the countries in which they operate (Elgin, Dune & Riley, 2012). Centralization serves to enhance the creation of similar and equal customer experience throughout the world, and thus serves to eliminate the disparities that would see some customers in some regions satisfied while the others are left dissatisfied. The management information systems of both Wal-Mart and Coca-Cola are intertwined in such a way that all the information gathered from the different regions and countries where the organizations operate are collected and stored in a central data collection and storage system, where such data and information is then analyzed to develop a comprehensive organizational strategy that uniformly meets the needs of all the customers, suppliers and distributors of the two organizations (Wailgum, 2007). This serves to enhance the uniformity of the operations of the different operational outlets of both Wal-Mart and Coca-Cola globally, thus enhancing smooth operations. Type of Knowledge and information The other aspect of similarity between management information systems for both Wal-Mart and Coca-Cola is in the type of information and knowledge that both organizations generate. First, the major type of knowledge that the information systems for both organizations generate, is the knowledge about the customers. Customers are an essential part of the success of both Wal-Mart and Coca-Cola, and thus information regarding the customers’ needs, their locations, changing trend and future needs forms the bulky of the information gathered by the management information systems (Wailgum, 2007). The fundamental aspect about both Wal-Mart and Coca-Cola is that they deal with customers who are within the international arena, and thus the needs of such customers are diverse, owing to the economic, social religious and backgrounds of such customers. Nevertheless, the major aims of both organizations are to meet the needs of all types of customers, regardless of the differences in their background and the needs of such customers. Therefore, Wal-Mart and Coca-Cola are largely involved in the collection of information regarding their customer needs, which is then integrated into the supply and the production systems of the organizations (Lucey, 2004). Knowledge regarding the supply and distribution chains also forms a fundamental part of the knowledge and information that the management information systems of both Wal-Mart and Coca-Cola generate. Both organizations have a complex supply and distribution systems, owing to the large number of customers that the organizations serve, as well as the geographical size of the regions that the organizations distributes the products. Therefore, gathering information regarding the supply and distribution chains enables the organizations to streamline the supply and distribution of their products, thus enhancing customer confidence and loyalty in their brands (Weerakoon & Husain, 2011). Inventory, Price, Supply-Chain and Financial monitoring and analysis The Wal-Mart and Coca-Cola Management Information Systems compare in the sense that both organizations use their information systems to collect data regarding to the inventories that the organizations hold in their different subsidiary. Therefore, the major aspect of similarity between Wal-Mart and Coca-Cola Management information systems is that they consist of an inventory management system, which is applied by the organizations to collect the records of their stocks in different stores and warehouses, to be able to establish the ability of the organizations to keep a constant supply of their products to their chain of customers (Wailgum, 2007). The sales, production and supply-chain tracking function is yet another similarity that is evident between the management information systems of both Wal-Mart and Coca-Cola. The two organizations apply this function to track the movement of the products that they sell through their various distribution channels, majorly to gather information regarding which products are fast moving and which ones are slow (Lucey, 2004). This information helps the two organizations to devise a system of increasing the supply of the products with a higher demand, while reducing the supply of the less demanded products, or alternatively devising ways of increasing the demand for such products. Financial analysis and updating also forms a vital part of the management information systems of both Wal-Mart and Coca-Cola, since it forms the basis of assessing the success of the organizations performance in the market (Weerakoon & Husain, 2011). Sources of information The sources of information from which both Wal-Mart and Coca-Cola generates their knowledge form another basis of the similarity between the management information systems of the two organizations. Both organizations generate their information from a variety of sources, which include the primary sources such as websites, the internet and the customer feedback correspondents (Weerakoon & Husain, 2011). Both Wal-Mart and Coca-Cola have developed a management information system that actively collects and gathers primary data regarding their customers’ needs, their competitors’ strategies, and the efficient strategies of meeting the demands of their suppliers and their distributors. The internet and websites of their customers, competitors, suppliers and distributors forms a fundamental source of primary information required by the organizations, to streamline their operations and serve the needs of their customers efficiently (Wailgum, 2007). Secondary sources of information such as the social media and business and consumer magazines also form a major source of information for both Wal-Mart and Coca-Cola, regarding the needs of their customers, as well as the strategies for streamlining their supply and distribution channels. Contrast between Wal-Mart and Coca-Cola use of information systems to help manage internal operations and to make decisions Production and operational analysis The only major difference that exists between the management information systems of both Wal-Mart and Coca-Cola is in the production, functional and operational analysis for the two organizations, considering that Wal-Mart is only involved in the distribution of retail products, that its management information system misses on the production analysis aspect that is present in the Coca-Cola’s management information system, since it forms a basis of one of its major functions, which is the production of beverages (Elgin, Dune & Riley, 2012). Since Coca-Cola is involved in the production functionalities, its management system has incorporated the production function analysis, where the company is involved in assessing the effectiveness of its production functions, while also gathering information regarding how the production process can be improved and made more effective. The production functionality assessment for Coca-Cola is also centralized, where by all the chains of production facilities throughout the world must adhere to a uniform scheme of production, to enhance the uniformity of the customer experience, while also streamlining and enhancing the smooth operation of the company globally (Weerakoon & Husain, 2011). How Wal-Mart and Coca-Cola use information technology for competitive advantage Information technology is a vital tool that is applied as a competitive strategy for both Wal-Mart and Coca-Cola. The two organizations have applied information technology systems to develop a robust and tight-proof distribution network globally, which enables the organizations to have a uniform and smooth mode of operations in the countries and regions that they serve (Wailgum, 2007). Through an elaborate information and data gathering and storage system established by both Wal-Mart and Coca-Cola, they are able to generate vital information regarding the customer needs, as well as the efficiencies and deficiencies of their supply-chain systems, which is them applied towards enhancing the distribution of their products to the consumers globally (Lucey, 2004). This way, it has been possible for the two organizations to sustain a supply and distribution model that has proved difficult for their competitors, thus granting these two organizations a competitive advantage. Centralization of the operations of both Wal-Mart and Coca-Cola is yet another application of technology that has made it possible for the two organizations to have a competitive advantage, through being able to lower their operational costs, which in turn has increased their profitability margins (Wailgum, 2007). The two organizations have centralized their information gathering and analysis systems, which then enables them to develop uniform sales and supply chain, while also generating information in regard to the customer demands and preferences in different markets (Weerakoon & Husain, 2011). This enables the two organizations to meet the needs of their diverse customers, while also reducing the operational costs of information gathering and strategy formulation, while also enhancing the uniformity of service to customers and the smoothness of the supply chain globally. The two organizations have also found it easier formulate strategies that make their operations efficient and effective, thus attracting more customers (Lucey, 2004). Consequently, Wal-Mart and Coca-Cola have been able to have an upper hand over their competitors in the markets they serve. Individual and organizational consequences of the use of information technology and the potential security breaches and computer crimes The individual and organizational consequences of the use of information technology for both Wal-Mart and Coca-Cola is that; it has made the two organizations more effective and efficient in the operations, through enabling a smooth global supply and distribution chain, which is one of the most difficult operational advantage for any organization to achieve (Lucey, 2004). The benefit of this smooth global supply and distribution chain is that, the organizations have been able to ensure the availability and accessibility of their brands globally, thus increasing their market share and profitability. The other consequence of the information technology use by the two organizations is that they have been able to lower their operational costs, which in turn has increased their profitability margins (Wailgum, 2007). The potential security breaches and computer crimes The fundamental potential security breaches and computer crimes for Wal-Mart and Coca-Cola is hacking into their systems resulting to theft of vital customer and organizational information, which can then be used in financial frauds, considering that the two organizations are centralized, thus stores all the vital information is a centralized database (Wailgum, 2007).Wal-Mart was the subject of hacking and customer information theft in 2005, while Coca-Cola was a subject of hacking and theft of information regarding to a prospective acquisition in 2009 (Elgin, Dune & Riley, 2012). References Elgin, B., Dune, L. & Riley, M. (November 5, 2012). Coke Gets Hacked and Doesn’t Tell Anyone. Bloomberg. http://www.bloomberg.com/news/2012-11-04/coke-hacked-and-doesn-t-tell.html Lucey, T. (2004). Management information systems. London: Thomson Learning. Wailgum, T. (2007). 45 years of Wal-Mart history: a technology time line. CIO Magazine, Retrieved: November 5, 2013 from http://www.cio.com/article/147005/45_Years_of_Wal_Mart_History_A_Technology_Time_Line Weerakoon, N. & Husain, S. (2011). Information Management: Coca-Cola...How they gather information? What type of information they gather? How this information helps Coca-Cola. Retrieved: November 5, 2013 from http://www.authorstream.com/Presentation/nipunaplus-712672-information-management-last/ Read More