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Location Planning

Another most important role that every organisation must focus on is location planning. Success or failure actually
depends on the location where it is situated. So, location planning plays a vital role for any organisation. Better location
planning leads the organisation in success and obviously worse location planning leads the organisation in failure.
Therefore, it is an essential significant success factors for any organisation. Thus, it is very important for businesses to
choose an ideal location.
Location Strategy
One of the most important decisions a firm makes
Increasingly global in nature
Significant impact on fixed and variable costs
Decisions made relatively infrequently
The objective is to maximize the benefit of location to the firm
Location and Costs
Location decisions based on low cost require careful consideration
Once in place, location-related costs are fixed in place and difficult to reduce
Determining optimal facility location is a god investment
Location Decisions
Country Decision
1. Political risks, government rules, attitudes, incentives
2. Cultural and economic issues
3. Location of markets
4. Labor talent, attitudes, productivity, costs
5. Availability of supplies, communications, energy
6. Exchange rates and currency risks
Region/ Community Decision
1. Corporate desires
2. Attractiveness of region
3. Labor availability, costs, attitudes towards unions
4. Costs and availability of utilities
5. Environmental regulations
6. Government incentives and fiscal policies
7. Proximity to raw materials and customers
8. Land/construction costs
Site Decision
1. Site size and cost
2. Air, rail, highway, and waterway systems

3. Zoning restrictions
4. Proximity of services/ supplies needed
5. Environmental impact issues
Factors That Affect Location Decisions
Exchange rates and currency risks
Can have a significant impact on cost structure
Rates change over time
Costs
Tangible - easily measured costs such as utilities, labor, materials, taxes
Intangible - less easy to quantify and include education, public transportation, community, quality-of-life
Political risk, values, and culture
National, state, local governments attitudes toward private and intellectual property, zoning, pollution,
employment stability may be in flux
Worker attitudes towards turnover, unions, absenteeism
Globally cultures have different attitudes towards punctuality, legal, and ethical issues
Proximity to markets
Very important to services
JIT systems or high transportation costs may make it important to manufacturers
Proximity to suppliers
Perishable goods, high transportation costs, bulky products
Proximity to competitors
Called clustering
Often driven by resources such as natural, information, capital, talent
Found in both manufacturing and service industries
Layout Design
Layout is the blueprint for arrangement of facility to provide working, service and reception, and storage and
administrative areas. Traditional methods are used to design the layout. These methods include templates, scale plans,
string diagrams, and travel charting as they have been proved as low-cost methods of achieving either optimal or near
optimal layout plans. Care must be taken by organisation when designing layout because poor layouts may lead the
organisation to reduce the overall capacity and overall productivity.
Layout Design Considerations
Higher utilization of space, equipment, and people
Improved flow of information, materials, or people
Improved employee morale and safer working conditions
Improved customer/client interaction
Flexibility

Types of Layout
1. Office layout: Positions workers, their equipment, and spaces/offices to provide for movement of information
2. Retail layout: Allocates shelf space and responds to customer behavior
3. Warehouse layout: Addresses trade-offs between space and material handling
4. Fixed-position layout: Addresses the layout requirements of large, bulky projects such as ships and buildings
5. Process-oriented layout: Deals with low-volume, high-variety production (also called job shop or intermittent
production)
6. Work cell layout: Arranges machinery and equipment to focus on production of a single product or group of
related products
7. Product-oriented layout: Seeks the best personnel and machine utilizations in repetitive or continuous production
Good Layouts Consider
1. Material handling equipment
2. Capacity and space requirements
3. Environment and aesthetics
4. Flows of information
5. Cost of moving between various work areas
Office Layout
Grouping of workers, their equipment, and spaces to provide comfort, safety, and movement of information
Movement of information is main distinction
Typically in state of flux due to frequent technological changes
Work Cells
Reorganizes people and machines into groups to focus on single products or product groups
Group technology identifies products that have similar characteristics for particular cells
Advantages of Work Cells
1. Reduced work-in-process inventory
2. Less floor space required
3. Reduced raw material and finished goods inventory
4. Reduced direct labor
5. Heightened sense of employee participation
6. Increased use of equipment and machinery
7. Reduced investment in machinery and equipment
DEMOGRAPHIC PATTERN
A pattern revealed by a population variable such as birth and death rates, income, medical health etc.
physiography

1. (geography) The subfield of geography that studies physical patterns and processes of the Earth. It aims to understand the
forces that produce and change rocks, oceans, weather, and global flora and fauna patterns.

MIDTERM LECTURE
PRELIMINARY INVESTIGATION
STEPS IN THE PRELIMINARY INVESTIGATION
During a preliminary investigation, a systems analyst typically follows a series of steps.
1. Understand the Problem or Opportunity
- If the systems request involves a new information system or a substantial change in an
existing system, systems analysts might need to develop a business profile that
describes business processes and functions.
2. Define the Project Scope and Constraints
- Determining the project scope means to define the boundaries, or extent, of the project
being as specific as possible.
a. Present Versus Future Constraints
- Is the constraint something that must be met as soon as the system is developed or
modified, or is the constraint necessary at some future time.
b. Internal Versus External Constraints
- Is the constraint due to a requirement within the organization or does some external
force, such as government regulations.
c. Mandatory Versus Desirable Constraints
- Is the constraint mandatory? Is it absolutely essential that the constraint is met, or is it
merely desirable? If desirable, how important is the constraint?
3. Perform Fact-Finding
- Fact-finding involves various techniques, depending on what information is needed to
investigate the systems request, fact-finding might consume several hours, days, or
weeks.
a.
b.
c.
d.

Analyze Organization Charts


Conduct Interviews
Observe Operations
Carry Out a User Survey

4. Determine Feasibility
- Analyzed the problem or opportunity, defined project scope and constraints, performed
fact-finding to learn about factors that might affect the project, and estimated the costs
and benefits of the new system. Now you are ready to determine operational, technical,
and economic feasibility.
5. Estimate Time and Cost to Continue Development
- To develop specific time and cost estimates for the next development phase.
a. What information must you obtain
b. What source of information will you use
c. Will you conduct interviews?
d. Will you conduct a survey?
e. How much will it cost to analyse the information gathered and to prepare a report with
findings and recommendations?

6. Present Results and Recommendations to Management


- The final task in the preliminary investigation is to prepare a report to management.
The report includes an evaluation of the systems request, an estimate of costs and
benefits, and your recommendation.
THE IMPORTANCE OF STRATEGIC PLANNING
- Strategic planning is the process of identifying long-term organizational goals, strategies,
and resources.
During strategic planning, many companies ask a series of broadly worded questions that is
called a SWOT analysis because it examines a companys strengths (S), weakness (W),
opportunities (O), and threats (T).

When a company performs a SWOT analysis, a long term strategic plan emerges. The plan
requires technical, financial, and human resources. Most important, the strategic plan requires
information resources and technology that are supplied by IT professionals, including systems
analysts.

INFORMATION SYSTEMS PROJECTS


Reasons for Systems Projects
-

the starting point for a project is called a systems request, which is a formal way of asking
for IT support. A systems request might propose enhancements for an existing system, the
correction of problems, or the development of an entirely new information system.

Five common reasons for systems requests:


IMPROVED SERVICE systems requests often are aimed at improving service to customers or
users within the company.

BETTER PERFORMANCE the current system might not meet performance requirements.
Performance limitations also result when a system that was designed for a specific hardware
configuration becomes obsolete when new hardware is introduced.

MORE INFORMATION the system might produce information that is insufficient, incomplete,
or unable to support the companys changing information needs. In the face of intense
competition and rapid product development cycles, managers need the best possible information
to make major decisions on planning, designing, and marketing new products and services.

STRONGER CONTROLS A system must have effective controls to ensure that data is accurate
and secure. Controls must be effective without being excessive. If a system requires redundant
data input or takes too long to verify data item, internal users and customers might complain
that the system is not user-friendly.

REDUCED COST The current system could be expensive to operate or maintain as a result of
technical problems, design weaknesses, or the changing demands of the business. Cost-benefit
analysis might show that a new system would be more cost effective and provide better support
for long-term objectives.

FACTORS AFFECTING SYSTEMS PROJECTS


Every business decision that a company makes is affected by internal and external factors, and
IT Systems projects are no exception.

Internal and External factors that affect IT systems projects.


USER REQUESTS As users rely more heavily on information systems to perform their jobs,
they are likely to request even more IT services and support.

TOP MANAGEMENT DIRECTIVES Directives from top managers are a prime source of major
systems projects. Those directives often result from strategic business decisions that require new
IT systems, more information for decision making, or better support for mission-critical
information systems.

EXISTING SYSTEMS Errors or problems in existing systems can trigger requests for systems
projects. System errors must be corrected, but analysts often spend too much time reacting to
day-to-day problems without looking at underlying causes.

INFORMATION TECHNOLOGY DEPARTMENT Many systems project requests come from the
IT department. IT staff members often make recommendations based on their knowledge of
business operations and technology trends. IT proposals might be strictly technical matters, such
as replacement of certain network components, or suggestions might be more business oriented,
such as proposing a new reporting or data collection system.

THE ECONOMY Economic activity has a powerful influence on corporate information


management. in a period of economic expansion, firms need to be ready with scalable systems
that can handle additional volume and growth. Predicting the business cycle is not an exact
science, and careful research and planning is critically important.

TECHONOLOGY Changing technology is a basic force in business and society in general.


Technology also dramatically reshapes existing business operations.

GOVERNMENT Federal, state, and local government regulations affect the design of corporate
information systems. The debate about Internet sales tax issues could profoundly affect ecommerce, as well as traditional retail business.
SOFTWARE AND HARDWARE VENDORS Most companies have a mix of software and
hardware that must work together to support information systems requirements.

COMPETITORS Competition drives many information systems decisions. New product research
and development, marketing, sales, and service all require IT support.

CUSTOMERS Customer service is vitally important, and information systems that interact with
customers receive top priority in most firms.

SUPPLIERS with the growth of electronic data interchange (EDI), relationships with suppliers
are critically important. EDI also enables just-in-time (JIT) inventory systems, which rely on
computer-to-computer data exchange to minimize unnecessary inventory.

EVALUATION OF SYSTEMS REQUESTS

In most organizations, the IT department receives more systems requests that it can handle.
Many organizations assign responsibility for evaluating systems requests to a group of key
managers and users.

Feasibility study includes tests for operational, technical, and economic feasibility:
Operational Feasibility
Technical feasibility
Economic Feasibilty
a. Tangible Benefits
b. Intangible Benefitss.
Determining Feasibiltiy

STEPS IN EVALUATING AND PURCHASING SOFTWARE PACKAGES

1. Evaluate the Information System Requirements


a. IDENTIFY THE KEY FEATURES OF THE SYSTEM evaluating system requirements
involves highlighting any critical features they system mush have.
b. ESTIMATE VOLUME AND FUTURE GROWTH you need to know the current volume of
transactions and processing and then forecast changes over a three-to-five-year period.

Volume figures are constraints for both the software package and the hardware
required. You must make sure that the package and the hardware can handle future
transaction volumes and data storage requirements.
c. SPECIFY ANY HARDWARE CONSTRAINTS the software must run properly on your
current or proposed hardware platform. Whenever possible, you should make decisions
about software first because software is the main element in any system it is the part
with which people work and directly affects the system usability.
d. PREPARE A REQUEST FOR PROPOSAL OR QUOTATION to obtain the information you
need to make a decision, you should prepare a request for proposal or a request for
quotation.

CASE STUDY MIDTERM EXAM


Analyze the situation and state the possible solution.
Use your examination booklet to answer the case study. Submit on Tuesday August 25, 2015
You are the IT Director at Attaway Airlines, a small regional air carrier. You chair the companys systems review
committee and you are currently dealing with strong disagreements about two key projects. Dan Esposito, the marketing
manager, says it is vital to have a new computerized reservation system that can provide better customer service and
reduce operational costs. Molly Kinnon, vice president of finance, is just as adamant that a new accounting system is
needed immediately, because it will be very expensive to adjust the current system to new federal reporting requirements.
Molly outranks Dan, and she is your boss. The next meeting, which promises to be areal showdown, is set for 9:00a.m
tomorrow. How will you prepare for the meeting?
QUESTIONS:
1. What questions and issues should be discussed?
2. Advantage & Disadvantage of each proposal?
3. Which proposal will you approve and why?
How much am I getting paid? What kinds of benefits come with the job? How is vacation time accrued, and what about
sick leave?
If I were in this situation, I would have to obey my boss, first and foremost. If you were any good in IT management, you
could ask your boss's permission to multitask and work on both needs. Of course, a REALLY good IT director would
know how to delegate, and allow his BEST programmer to work on his boss's needs, while the NEXT best programmer
work on designing and building a new computerized reservation system.
But what *I* want to know is, why is the VP for finances YOUR boss? What kind of hierarchy is THAT???

A computer reservations system or central reservation system[1] (CRS) is a computerized system used to store and
retrieve information and conduct transactions related to air travel, hotels, car rental, or activities. Originally designed and
operated by airlines, CRSes were later extended for the use of travel agencies. Major CRS operations that book and sell
tickets for multiple airlines are known as Global Distribution System (GDS). Airlines have divested most of their direct
holdings to dedicated GDS companies,[2] who make their systems accessible to consumers through Internet gateways.
Modern GDSes typically allow users to book hotel rooms, rental cars, airline tickets as well as activities and tours. They
also provide access to railway reservations and bus reservations in some markets, although these are not always integrated
with the main system.
Accounting System:

What a Good System Delivers Properly installed and implemented accounting software can contribute many benefits to
your organization, including:
Better decision-making capabilities Sound accounting software can provide both a snapshot-in-time look at your
organization, as well as the detailed reports and other data necessary for long-term strategic planning.
Improved cash flow Cash management is essential for all businesses. Integrated billing, inventory, accounts receivable,
and accounts payable allow you to manage that valuable cash more easily and efficiently. Better cash management
provides your organization with more options for revenue-generating campaigns and long-term growth.
More accurate information With fully integrated accounting software, youll not only have more information at your
fingertips, youll have more accurate information. Unlike a manual accounting system, where a great deal of time is spent
cross-checking figures recorded in different ledgers (and where the potential for errors dramatically increases) in a
good computerized accounting system, information is entered only once and is used throughout the system.
More control Integrated accounting software provides real-time access to your organizations critical financial
information. This provides you with greater control and the ability to more efficiently manage the components of your
business.
A foundation for growth The right accounting software can help you as your organization grows: expanding as your
business expands, allowing for additional users, and offering the kinds of reports and other business intelligence data
required.
Do More Now
The challenges to successfully choosing, installing, and implementing new accounting software are many. But so are the
opportunities to gain greater control of your organizations financial affairs, to make better decisions, and to improve
cash flow, among others. The remainder of this guide describes the six steps to successfully selecting accounting software:
1. Involve the right people
2. Define the challenge
3. Choose a consultant
4. Evaluate application performance
5. Choose a software vendor 6. Implement the system

Advantages That Can Save Money


Computerized accounting systems offer several advantages for small businesses. Systems for small and
medium sized businesses can be purchased off the shelf at low cost. These programs allow managers to
see the company's financial position in "real-time" and make adjustments to the business strategy as
needed. Computerized systems can also provide instant reports on stock evaluation, profit and loss,
customer accounts and payroll and sales analysis, again, allowing faster adjustments in your business
strategy. In addition, transactions need to be input only once, and, with some training, anyone in the
company can handle the inputting.

Advantages That Can Save Time


Using a computerized accounting system can save you time. Accounting software allows faster data entry
than manual accounting, and allows documents such as invoices, purchase orders and payroll to be
collated and printed quickly and accurately. Because of its efficiency and ease of use, computerized
accounting systems also allow you to improve inventory control and payment collection, saving time and

improving cash flow. Because computerized systems update some records automatically, your account
records will always be up to date, saving time in updating.

Disadvantages
Using a computerized accounting system comes with its own set of problems, such as the need to protect
against data loss through power failure or viruses, and the danger of hackers stealing data. Computer
fraud is also a concern, and you need to instigate a system of controls for who has access to the
information, particularly customer information. If there is a security breach and data is stolen,
management can be held personally liable for the loss of data. You also need to make sure that the data
has been correctly entered into the system, as a mistake in data entry can throw off a whole set of data.

Airlines need to maintain multiple types of information


Route information : Covers the destinations served by the airline
Aircraft information : Information on the aircrafts used by the airline
Schedule information : Covers information on days and times on which the flights operated by the airline are
scheduled to run
Fare information : Prices for various
Reservation information : Passenger and cargo reservations, including information on passenger tickets

CRS have been integrated into Global Distribution Systems (GDS) which contain information about t-elated services
for airlines (car .1 cornpanies, hotels, railways...).
All the reservations can be made through a GDS and tickets can be issued thanks to the so called Passenger Name
Record (PNR) or Guest Name Record (GNR) which is created for each passenger containing all services-related
customer information
A GDS also makes some or all of these functions available to subscribing travel agents, booking engines and
airlines.