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Information System Introduction

Information system (IS) is the study of networked hardware and software used by people and
organizations in collection, filtering, processing and distributing data. Analysis and design of systems,
computer networking, information security, database management and decision support systems are some
of the major sections which come under this. Likewise, PepsiCo also uses a very advanced system.

Flow of Information Systems









Executives



Senior Managers



Middle Managers


Workers
Executive
Information
Systems
Decision Support
System
Management Information
System
Transaction Processing System

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The main role of Information Systems and Information Technology at PepsiCo
Gaining operational excellence and advantage through the usage of new technology to provide an
efficient service as well as maintain their work at an optimum level.
Designing and developing new products and services. Designing new products and their
structures are done through CAD software such as Auto CAD, 3D Max or Maya. An example can
which can be given is creating new designs/shapes for soft drink bottles.
Gaining customer satisfaction and loyalty through efficient service.
Advanced and improved decision making. Collection of data from sales and analyzing them using
information systems developed for that very purpose delivers PepsiCo accurate reports on what
they should do in the upcoming time periods.
There are a lot of companies which produce soft drinks such as Pepsi. So to have a competitive
advantage over the others PepsiCo must use the latest technology available.

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Ordering to Delivery Process at PepsiCo

The above illustrated diagram shows how the process relevant to ordering and delivery functions. Before
some time almost all these functions were manual. But now almost all organizations and companies
including PepsiCo use Information Systems and Information Technology to make sure the process runs
smoothly.
If we explain from the beginning of the flow, all the orders generated, in this case, soft drinks, are entered
into a local system. The local system can be defined provincially, or district wise. The generate order is
created from analyzing the sales of soft drinks during the past few months or a defined time period. This
analysis is done through an Information Systems which are able to predict future sales based on previous
sales. Then this order is submitted to the main local body of distribution, where all the financial matters as
well as production and distribution is handled.
At the accounting and finance branch, the amount of credit available for production is always kept in
touch. This is done through internet banking methods. All information regarding transactions and
balances at every bank account are accessed daily to ensure the fact that the people necessary are always
updated with the latest information. After the balances are checked, the amount of credit necessary for
production is approved. After that, the finance branch generates the invoice for the approved credit. Here,

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all the information regarding these transactions are stored at a central database, which can be accessed by
approved authorities later.
Then at the manufacturing and productions section, the order is processed and the required amount of soft
drink bottles are prepared. Then all prepared products are separated according to the orders done from
local distribution centers. The reason for the overall efficiency is the usage of Information Systems and
Information technology to centralize the task.
Usage of Information Systems in a functional perspective
1. Sales and Marketing

The main use of Information Systems in Sales and Marketing function is in the region of Market Research
Systems. Sales data from all regions are fed into the sales system. These data are updated regularly to
maintain their sales at the highest level possible. Online marketing, smart phones, CRM (Customer
Relationship Management) systems and social media are the main bran12ches of sales and marketing in
this new era.


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The CRM systems helps the organization to identify new potential clients and new markets. Attention
gained through websites such as social media, and generating web traffic otherwise known as social
media marketing is what drives the current market. PepsiCo uses online or social media marketing to the
maximum to gain an advantage over their immediate competitors. This is really effective because social
media sites such as Facebook and YouTube are accessed my millions of people daily. The exposure give
to whatever brand, in this case, Pepsi, is thousand times greater than what it would have gained through
printed or any other traditional advertising/marketing media.
TPS (Transaction Processing System) is one of the major systems used by PepsiCo to help them increase
their sales as well as do good marketing. Because of this system, all the operational level managers are
updated with the necessary information about the activity which they have to monitor. All the internal
operations of the company as well as the information about suppliers are all monitored through this
system. 30 to 50 thousand man hours are saved weekly because of the implemented TPS.
2. Human Resources Management
The systems and processes which occur in the intersection between human resource
management and information technology are known as Human resources systems. In every organization,
the function of human resources departments is administrative and common. Later on, organizations
began to automate many of these processes electronically by introducing specialized human resource
management systems in order to reduce the manual workload of these administrative activities. An
effective Human Resources System provides information on just about anything the company needs to
Human
Resources
Information
Systems
HR
Planning
and
Analysis
Employee
and Labor
Relations
Staffing
Health,
Safety,
and
Security
Equal
Employm
ent
Compens
ation and
Benefits
HR
Developm
ent

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track and analyze about applicants, employees and former employees.
The main objective of this system is to support activities for attracting, developing & maintaining firms
workforce.
Senior management identifies manpower requirements for meeting long term business plans.
Such as,
Skills
Education level
Types
Number of positions etc.
Middle management monitors and analyzes recruitment, allocation & compensation of
employees.
Operational management tracks recruitment and placement of employees.

In PepsiCo, the payroll system automatically operates the pay process by collecting data on employee
time and attendance and calculating various taxes and deductions. To calculate automatic deposit, data is
normally collected by the modules which keep time and human resources information. This payroll

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module can cover all employee-related transactions by combining with existing financial information
systems.
The time and attendance system collects proper and acceptable time and especially work-related efforts.
The primary functions of this system are cost analysis and efficiency measurements (metrics). The
advanced functions of PepsiCo are providing huge flexibility in data collection methods, labor
distribution structures and data analysis attributes.
The HR management system used at PepsiCo is a module which covers many HR particular parts from
recruitment to retirement. This system saves information of selection, training, development, capabilities,
weaknesses and skills. PepsiCo also uses leading edge systems which have the ability to "read"
applications and then these systems enter appropriate data to database fields. After that, these systems
notify employers and provide position management information. Initially, PepsiCo use computer based
information systems to produce pay checks and payroll reports, maintain personnel records,
proceed position management.
In PepsiCo, online recruiting is a primary method handled by Human Resource department to gather most
suitable candidates for available positions within the organization.
The Analytics system enables PepsiCo to extend the value of Human Resource Information Systems by
taking out HR related data for the use with other business intelligence platforms. For example, they can
combine HR measurements with other business data to identify different trends and exceptions which
could be used to take advantages in the future.

3. Manufacturing and Production
By building up a collection of systems by PepsiCo for their main function, manufacturing and production,
they have been able to deal with the planning development and maintenance of production facilities.
Its actually fully responsible over the production of firms goods and services. Having systems for
production function allows all the level of decision making bodies inside PepsiCo to establish various
production goals. For example, apex level or the strategic level decisions, such as planning long term
manufacturing goals and technology investments and infrastructural development. Functional level
planning like managing status of production tasks, and maintaining the inventory capacities. And for
operational stage decisions like monitoring the manufacturing and the production cost.

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There are number of systems which are included inside this collection of Pepsi Co .which initially support
the flow of operations inside the organization.


Using Production scheduling and forecasting
This can be known as the most important and basic system inside the firm which actually ensures
efficiency in the production process by scheduling and controlling the, manufacturing facilities. By
analyzing the past sales and production capabilities, through this system PepsiCo has gain the ability to
produce their soft drink products in efficient and in an enhancing manner.
MRP (Material Requirement Planning)
It can be stated as a system that converts a production schedule in to a listing of the material and the
components required to meet that schedule, so that adequate stock levels are maintained and items are
available when needed in the PepsiCo facilities.

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The system has the following types of information as the inputs to the system.
1. Master production schedule produces a master schedule that encompasses the longest lead
time plus the longest production time. And specified information about the timing and the
quantity of finished goods required.
2. Bills of material which basically use to convert the gross requirement in to the net requirement.
Information such as subassemblies for each finish goods, components, and materials needed.
3. Inventory files containing information such as current stock levels in the warehouses.
4. Order release system produces reports for shop floor and purchasing

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After all the information passes through the system in PepsiCo, outputs such as the following can be
obtained.
New production schedule in rapid time developed
Purchasing orders developed
Work orders developed (if internal component manufacturing is needed.)
MRP (II) (Manufacturing Resource Planning)
This is an expansion of material requirement planning to give a broader approach than the MRP to the
production and the scheduling of resources such as labor requirements, machine hour requirements,
working capital requirement and even non production requirements. Mainly it can be describe as a
organizational system or an accounting information system.

Inventory control systems
Another major system under manufacturing ad production used at PepsiCo is the inventory control
system which is a process for managing and locating objects or materials. The system mainly manages
raw materials, finished goods and work in progress. Barcode scanners and/or RFID (Radio Frequency
Identification) readers are used identify objects listed under the inventory and they are used to record

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inventory transaction. These functions are done by the operators via fixed terminals (workstations), or
mobile computers. New orders, current inventory, packaging and shipping are all automated through
this system. The necessity of new hardware, notifications of maintenance times and replacement are
also a part of the inventory control system used at PepsiCo. All the inventory transactions which are
done locally are recorded in the main database.


ERP systems
ERP software is a commonly use software system in manufacturing facilities like PepsiCo. ERP system is
basically can be defined as a software that is designed to support and automated the business process
of medium and the large enterprise. ERP systems are accounting oriented information systems which
aid in identifying and planning the enterprise wide resources needed to resources, make account and
deliver the customer orders. Initially developed for MRP II systems, ERP tends to incorporate a number
of software developments such as the use of relational databases, object oriented programming and
open system portability.

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CIM (computer integrated manufacturing)
This system combines many of the other manufacturing systems into a single system within the
production area of PepsiCo. This actually represent the complete automation of the manufacturing
plant, with all processes functioning under computer control and digital information tying them
together. CIM integrates together advance manufacturing technology, quality controls and all other
relevant techniques in conducting manufacturing.
Supply Chain Management Systems
Managing the movement of materials and products from suppliers through manufacturing and
distribution to retailers are done through this system. The process which takes the product from raw
material supplier until the customer is maintained here. Supply Chain Management system coordinates
and integrates these flows among companies which are connected with PepsiCo.
ERPSystem
Financial
Management
Supply Chain
Management
Manufacturing
Resource
Planner
Customer
Relationships
Management
Human
Resource
Management

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References:
http://en.m.wikipedia.org/wiki/Human_resource_management_system
http://en.wikipedia.org/wiki/Information_systems
http://www.scribd.com/doc/24697834/Manufacturing-Information-System
http://123seminarsonly.com/Seminar-Reports/047/43382873-supply-chain-management.doc
http://www.scribd.com/doc/24697834/Manufacturing-Information-System