1

Abstract
The management information systems are becoming a must-to-have systems in most of the business organizations. This report analyzes the use of these management information systems for companies that have implemented these systems. For the purpose of effective analysis, Amazon company has been selected as a case study to find out the benefits of using information systems. This report provides an introduction on the business environment and the information systems which is followed by the theoretical foundations on the management information systems. After discussing the theories on the information systems, the report moves on to the real time use and benefits of management information systems in the context of the case study, Amazon.

Introduction
An organization is an integrated unit of sub-organizations and sub-systems that work towards achieving the same goal, which is often called the organizational objectives. To make these sub-systems and the sub-organizations within an organization requires expert management skills and effective management practices. As there are many stakeholders involved within an organization, the information transaction between these stakeholders hold the key in ensuring the success of the organization and the achievement of the organizational objectives. The managers in an organization requires to get the entire overview of the organization as a single system when they take business decisions and also they need to have quick access to the mission critical business data to help them take better business decisions. Its here the management information systems (MIS) play an important role in an organization; because it offers a single point for the managers to get quick access to the required business information. The management information systems can be called as an integrated system that consists of many sub-systems which gathers business data from all the stakeholders and processes them in to business information (Effy Oz, 2008). In todays business world, most of the companies are relying on some types of management information systems to enhance the way they do their business. While some companies use the information systems to gain competitive advantage and to increase productivity, so other companies use it as a way to reduce complexity of information transactions. This report analyzes the role of information systems in companies and how companies get benefited from implementing the management information systems.

Amazon: Case Study

This report will analyze the use of management information systems at Amazon. Amazon is the worlds largest online retailing company. Being headquartered in the US, Amazon started the ecommerce revolution in the world of retailing and ecommerce. Amazon 2

started by selling books online and soon they diversified their business into selling music, software, video games, DVDs, etc. Amazon has their regional offices in almost all countries. To manage their business, Amazon has employed thousands of employees and partners.

Literature Review
According to INFOSEC, National Information Systems Security Glossary, the management information systems can be defined as any telecommunications or computer related equipment or interconnected system or sub-systems of equipment that is used in the acquisition, storage, manipulation, management, movement, control, display, switching, interchange, transmission, or reception of voice and/ or data, and includes software, firmware, and hardware. The information systems are tools for the employees to input the data into the system and for the managers to use the information for taking business decisions. The main objective of the information systems is to control and monitor the information transacted inside and outside an organization, internal and external communication. These information is processed by the information systems implemented in a company and the output information is used by the top level management teams to take business decisions (Griffin, R.W, 2006). In some organizations, the management information systems play an important role in achieving their organizational goals. The information systems, in such cases, take a strategic role in a company. As the companies depend on the information outputs from the management information systems to make strategic decisions, it is important that the companies make vital investment into the implementation of the better management information systems. Also, it is important that the data entered into the management information systems maintain high quality, because wrong data input into the information systems can produce wrong information outputs. Therefore, it is highly important that the users enter valuable and correct data into the system (David F.R (2006). This means that the information systems as such cannot be a great asset if they are not implemented as per the requirement of the companies. Also, the information systems help in processing the raw data from the users and generate useful business knowledge.

Process of the Management Information Systems

The first process in the management information system is the data flow from the users into the information systems. The users like employees, managers, customers, etc. enter the data into the information systems periodically. For example, when a sales happens in a company, the sales team enters the sales details such as the invoice, customer details, leads, amount of the sale, future sale prospects, etc. This information will be stored in the information system so that other team members can view it and use this information in 3

order to make another sale in the future. The second stage in the information system process is the processing of the inputs from the users of the systems. Typically, the management information systems will have central servers that processes the data from its users and stores them in the database. The third stage of the information systems process is the information flow. The information flow is the process of sending the input data to the various modules of the information system to make them useful information for various departments in a company. The fourth stage in the information systems process is the User Processing. In this stage the users will access the information generated by the information systems and take the required parts as per their business requirements. For example, the Human Resource team will take the performance related information while the marketing teams will take the sales and development information for their future activities. The final stage of the information systems process is the decision assistance. The main aim of the information systems is to assist the users to take better business decision by providing the best information on the business.

Data Flows/ Inputs

Information Systems Processing

Information Flows/ Outputs

Decision Assistance

The management information systems are a result of the constant improvements in the concept of management. The discipline of management has contributed a lot to the design and development of the management information systems. This evident from the fact that the objectives of the management information systems are similar like the management, such as planning, controlling, and streamlining the activities in an organization. Therefore, the major objective of the management information systems is to assist the management of a company. The information systems help the managers to smoothen the every day management activities in a company. While the managers take decisive actions that will have direct or indirect effect on the future of the company, it is the information systems that provide the required data to enable the managers to take those decisions in a company. The information systems are an effective example of man-machine coordination in the filed of management (Versha Mehta, 1998). As a result of the introduction of highly intelligent information systems, companies currently depend heavily on these information systems in carrying out their daya to day business activities. Companies started using these information systems in order to cut down their operations and customer support costs. Slowly, the information systems were used even to reduce costs in the production departments. As these information systems gave great insight into the entire aspects of the production environment in a company, the production managers were able to take better decision that helped them to reduce the waste in production and to improve the production methods. Further, the information systems become an integral part of the internal communication among the departments. 4

In this aspect, the management information systems were considered as the repositories for the business knowledge. This aspect increased the value of using information systems in companies. The business knowledge is considered one of the valuable assets for any company. As the repository of the business knowledge, the information systems gathered data from various departments and processed them to make valuable business knowledge which was finally used by the top level management to take business decisions (Laudon K.C, Laudon, J.P, 2007). Reynolds, G, (2009) also backs up what Versha Mehta, (1998) has said about the information
systems that they help the top level management team to manage the company better. However,

Reynolds, G, (2009) takes the benefits of the management information systems further by adding that the information systems functions as a strategic tool in a company. The management teams in a company have to draft better business strategies to outperform their competitors in the market. As the markets are volatile and hard to predict, the management teams require the valuable business information in order to draft effective business strategies. By processing the raw data from the different stakeholders, the management information systems general usable business information for the managers. Reynolds, G, (2009) also says that the management information systems are a better communication channels in a company. As these information systems promote the interaction among all the departments in a company, it creates lots of useful business knowledge, which will become great strategic tools for companies to gain competitive advantage over their competitors in the market. According to Clough R.H , Sears G.A , Sears ,S.K , (2000), for multination companies which have several geographically separate offices, managing all their employees and working as a single business unit is a nightmare. The managers in such multinational companies, for example, Amazon, spend most of their energies and efforts just for the coordination activities among their various departments. The information systems automate most of the routine activities in a company and provide a wider platform for the employees to communicate seamlessly, regardless of their geographical locations. The need for information systems increases for the companies that expand their business into new markets and new countries. The information systems fill up the communication gap inside the various branches of an organization. In this manner the management information systems play the role of a unifier in large organizations, such as Amazon. Being a large business enterprise, Amazons major concern is to make sure all their business entities function as a single unit to achieve their organizational objectives. The online retailing business is becoming highly competitive with so many other big players in the same market, such as Ebay, etc. To compete effectively in this ecommerce market, Amazon needs to plan, control, and coordinate all their business information and use them to take effective business decisions. This can be achieved by implementing appropriate management information systems at Amazon.

Management Information Systems at Amazon and Their Benefits

Amazon is one of the pioneers in the ecommerce business in the world. As their business operations were already in the online marketing and sales, Amazon was using in-house developed information systems to streamline the information transacted inside and outside the company. However, these in-house developed systems were manual intensive and required manual processing and mining of the data generated. This process required lots of time and were less effective. However, with the advent of the modern and latest ERP and CRM software, Amozon scraped their custome made information system and migrated to the Pivotal CRM, an end to end customer relationship management information system developed by CDC Software Solutions. This management information system covers most of the business activities.

Conclusion
There is no doubt that the management information systems help a company to better manage their day to day business activities and help them to take better business decisions. However, there are a few problems associated with the management information systems available currently in the market. The major problem with these information systems are that most of the systems are highly technical and involves multiple software. The design of such information system is done by the development company and the users do not have any control on the overall design process of the information systems. Another problem is that these systems are highly dependant on certain computer platforms. Therefore, for a company with employees who lack the computer knowledge, implementing an information system is a nightmare. As a result, except the information technology industry, other industries do not use the information systems to their fullest extent.

Recommendations
Sales Management One of the major modules of the Pivotal CRM is the sales force automation. As Amazons business is mainly making online sales, Amazon uses this module to the maximum. This module of the information system has automated most of the sales activities which reduces the time for the sales team in generating and processing the sales. By processing and delivering the usable information to the sales team, this module of the information system can be enhanced to help the sales team to accelerate the sales cycle and increases the future sales prospects. Also, the graph and chart generation can be automated. 6

Marketing Management Marketing management is an important business activity in Amazon as this department is responsible for creating more customers and improving the brand image of the company. The information system that Amazon use, Pivotal CRM, has a module for marketing management which provides end to end support for the marketing teams across the globe. This information system can be customized to enable the marketing teams to create company specific innovative marketing campaigns, create dependable customer leads, and offers better business intelligence to the marketing department. The graphs and reports provided by the information system helps the market department to get deep insight into the prospective and target customers. This insight will increase their chances of converting the target customers into the future customers. Services Management Having a better portfolio of services will help a company to win over competition. As the online retailing business is getting highly competitive, it is important for Amazon to constantly innovate and offer innovative services to their customers. This will increase their customer base and also increase their sales. The management information system must provide a Services Management module that helps the services team to develop proven service models that will produce predefined results. This must be achieved through the innovative processing of the business data by the information system, Pivotal CRM. Partner Management Amazon has hundreds of business partners in several countries. These partners provide services to their customers in coordination with Amazon. Managing the partners effectively is very important for the future growth of the ecommerce business of Amazon. Therefore, Amazon had the requirement for partnership management feature in the information system that they use. The information system must have the collaboration feature that enables multiple people to work as a team collaborating using a single platform. For example, many people can work on a single document using the information system. This enables the free and seamless flow of information throughout the company. This information will be finally used by the managers to take business decisions. Finance Management Amazons finance department processes huge quantities of financial data each year which is highly time consuming and manual intensive. With the implementation of the information system, Amazons finance department has reduced the hours they spend on processing the data, because the processing of the data is now carried out by the management information system. The single console feature of the information system

helps the finance team to get an overall view of the companys finances and take quick decisions accordingly Human Resource Management As a large enterprise, Amazon has thousands of employees worldwide. Managing the human capital of the Amazon is a huge task for the human resource management department of Amazon. The information system has automated most of the human resource management activities. Also, the information system allows the employees to directly mange most of their information, such as leave applications, performance related details, feedback details, payroll details, etc. This has helped the Amazons human resource management team to focus more on the strategic functions. Also, by implementing the information system, Amazon has gained lots of cost savings and time savings. Supply Chain Management Supply chain management is one of the key functions in Amazon as the company is into the retail business. The retail business requires an effective supply chain which delivers the products bought by the customers on time and without damage. Also, Amazon requires to track the movements of the products it sells in real time. The information system they use offer some of these features wherein Amazon can have all the information regarding the supply chain on their systems and can plan accordingly. However, Amazon needs to implement other GPS devices for the real time monitoring of the movements of their sold and unsold products. The information system mainly helps Amazon to keep an optimum inventory, thereby reducing the cost of huge inventory. As more and more industries are moving towards adopting the latest technologies in order to increase their productivity and competitiveness, the information systems have become the backbone of the business operations. Companies mainly use the information systems to encourage flow of data among all the departments, monitor these data, process these data and use the information to take business decisions and to increase their productivity. Amazon uses the management information system, called Pivotal CRM in order to coordinate the communication among it employees and its customers. This has enabled Amazon to constantly improve their products and services and gain competitive advantage over their competitors.

References

1. Amazon: www.amazon.com
2. Clough R.H., Sears G.A., Sears S.K.(2000) Construction Project Management (4th Edition) John Wiley & Sons USA. Griffin, R.W (2006) Management (9th Edition) South-Western College Pub, USA. Laudon K.C.,Laudon J.P. (2007) Management Information Systems,(9th Edition) US ,Prentice Hall. Philip Kotler (1994). Marketing Management, Analysis, Planning, Implementation and Control. New York: Prentice Hall. 127. CRM: http://www.cdcsoftware.com/en/Solutions/CDC-Customer-RelationshipManagement-CRM Reynolds (2009) Information Systems for Business Managers (1st Edition) South Western College,USA. Somerville G.(2000), A holistic Approach to Structural Durability Design Taylor and Francis Group USA and Canada.

3. 4.

5.

6. Pivotal
7.

8.

9. Steven Alter (1999). Information Systems: A Management Perspective. 3rd ed. United States: Addison Wesley. 10. Terence Lucey (2004), Management Information Systems, 1st Edition, Cengage Learning EMEA
11. Toffler, A. (1980). Third Wave. 3rd ed. U S A.

12. Versha Mehta (1998), Management Information System, 1st Edition, Anmol Publications PVT. LTD.