Financial Management of Information Systems Essay

Financial Management of Information Systems - Essay ExampleCustomer service, operations, product and marketing strategies, and statistical distribution are heavily, sometimes even entirely, dependent on IT. For example, the internet and intranets, and external inter- schemeal networks, called extranets can provide the study infrastructure that a vexation asks, to make it more efficient and effective.Information systems perform three lively roles in any type of organization. They support business operations, guide managerial decision-making, and provide strategic and militant advantage to the organization (ICFAI Center for Management Research, 2003).The hierarchical classification of an organization comprises three levels - running(a), tactical, and strategic. The genius of decisions make at each level is different. Therefore, the information requirements at different levels are also different. At the operational level, a large quantity of data needs to be processed. This data is usually generated by business transactions with customers, suppliers etc. At the tactical level, the concern shifts from day-to-day decisions that maintain a short-term focus, to those which have a medium-term impact on the organization. Consolidated reports on the performance of various business units would be necessitate to compare plans with actual, and to take remedial measures for any deviations. At the strategic level, in addition to the internal information, the decision-makers need information from the external environment as decisions at this level are taken in situations mark by uncertainty.The objective of using information applied science in business is to determine business processes, which are relevant for applications, which will improve business performance. This may involve improvements in the efficiency of operations, in the feature of the management processes and even in the way the business is conducted or organized. When it is targeted at operational eff iciency, transaction impact becomes important.Transaction affect is a fundamental activity of ein truth organization. Although an information system has a very important role to play in supporting management, ensuring control, and undertaking other knowledge work, such an idiom should in no way, obscure its importance in transaction processing. Without transaction processing, normal functioning of an organization would be impossible, and the data for management information would not be available. Beyond such operational level, processing of data, information systems have specific applications in the various functions of an organization, like accounting etc.Information technology can benefit businesses in many ways. It helps businesses in performing various functions, solving business problems and pursue business opportunities. Since organizations are goal-oriented, there should be a clear understanding of the type of information to be collected, stored and analyzed. Management c an be categorized into top, middle and lower management. Due to the difference in the nature of decisions taken at different levels of management, their information needs also vary. This information should also be accordant with the requirement of the organizational level at which it is targeted. Accounting information systems are the oldest, and perhaps the most astray used information syste