Assignment 2

Subject: Management Information System

Student: Emina Lakic
Reference number: BD639

1. Identify a business already using telecommunication and communication networks in

business and investigate the what, who, how etc. For example, Central bank, how it
supports business communication to exchange data (voice, audio, text, etc.).

In the past twenty years technological advances and regulatory changes have not only altered
the banking and telecommunications industries, but have also brought the two industries closer
together. Many banking institutions now provide telecommunications services, while some
telecommunications companies provide financial services. Banks already lease some
communications line capacity to other users and extensively use telecommunications systems to
provide automated teller machines (ATMs) in locations far removed from bank branches.
Telecommunications companies offer such traditional bank services as issuing and processing
credit cards.
Banks were the first business sector to become major users of data communication networks to
carry out cheque clearing and other transactions.
Information about money is transmitted within a bank’s network of branches and cashpoint
machines, as well as to other banks within the country and banks worldwide. The financial
networks also connect the banks to global financial services such as VISA and MasterCard,
EuroCard and so on. These networks allow cardholders to make purchases with credit or debit
cards, withdraw cash or foreign currency from bank cashpoint machines, make purchases over
the telephone or Internet and obtain cash advances. Wireless links can connect both fixed and
mobile point-of-sale or cashpoint terminals, those installed in stores and kiosks, as well as mobile
terminals for street vendors, tourist sites and vehicles.
People everywhere can have bank accounts from which they can withdraw by debit or credit
cards and into which they can receive payments and make deposits. The access device is a bank
or credit card that is swiped at a point-of-sale terminal or inserted into a cashpoint machine
which may be positioned in a wall at a convenient location or on a truck with a wireless
connection that visits farms, villages and remote work sites: a circuit-riding bank.
The application of networks is a vital part of an effective information communication technology
enabled system, which is especially true in the case of banks with a branch network. Local Area
Network (LAN) may also be seen as a basic indicator of the minimum infrastructure required to
enable companies to conduct electronic banking at a substantial level
Banks and financial services companies have been major players in the telecommunications
sector for many years. Banking institutions have been offering new services and features to
improve the efficiency and convenience of their business. Banking is no longer defined by an
individual customer conducting business through a teller; it is now characterized by a system of
electronic transactions conducted over computer networks from points around the globe. Today,
57 percent of banking transactions occur outside bank branches. Future will bring a dramatic shift
away from the traditional bank branches toward more electronic systems. Banks will likely offer
new services in the future, they already use telecommunications technology in three important
ways: leased lines, ATMs, and home banking.
Examples of the use of internal network and communication in banking operation include:
Leased Lines. Leasing telecommunications lines has grown in importance in recent years. The
practice usually consists of buying excess transmission capacity from telecommunications
providers and using it for specialized purposes. Advances in communications switching
technology have made it feasible for some businesses to lease access to these lines and to
provide new data processing services by attaching their own switching and computer processing
equipment. With the proliferation of private telecommunications lines and the decrease in the
cost of computer and networking equipment, leasing communications lines is a burgeoning field.
In the past, data communication was done over the public voice network, but the limitations of
that network, in both speed and accuracy, encouraged many business users to look to private
digital lines for their communications needs. Many advanced service providers have entered the
field by attaching network management equipment to the lines.

Automated Teller Machines. . Automated teller machine has the capacity to make available
enquiries on balances, interest and exchange rates, withdrawals, deposits and account transfers
24/7. Banks provide ATM access via their branch offices, where the ATMs are wired to the
banking data network. Automated teller machines have become a critical component of a bank's
ability to communicate with customers and are the most recognizable electronic financial service.
ATMs allow use of the telecommunications network for remote withdrawals, deposits, and
account information retrieval twenty-four hours a day. Beyond increasing customer contact, a
great benefit to banks is that ATMs are extremely efficient, because fewer personnel are needed
to perform the great number of transactions.

Electronic Banking. The banking industry also employs telecommunications technology in a third
area - home banking. These systems allow customers to access bank computers from remote
locations, using networks that may be public (public phone network), private (private access
terminals), or both.
Electronic Banking services include the following:
Electronic Mail: is an electronic means of sending and receiving mails. Its application is popular
within a network environment or through the internet. Therefore with a network of systems, a
note, letter, report, and chart can be sent from office to another within the company.
Credit Card: is the payment system that involves no account debit at the end of each transaction.
Electronic and Mobile Payment System: Electronic payment system that works in conjunction
with electronic commerce, while Mobile payment system is used by mobile commerce.
Personal Computer Banking (PC): allows the bank’s customers to access information. The
increasing awareness of the importance of computer literacy has resulted in increasing the use
of personal computers. This certainly supports the growth of PC banking which virtually
establishes a branch in the customers’ home or office, and offers 24-hour service, seven days a
week. It also has the benefits of Telephone Banking and ATMs.
Internet Banking: is a form of banking transaction carried out on the internet. There must be
internet access and transaction is through a personal computer.
Online Banking: is a synonym to internet banking but predominantly used to reference banking
automation as against manual operations.
Mobile Banking: has brought about ease, convenience, privacy and security of online banking
through mobile devices that neatly fit into one’s purse or pocket based on SMS facility.

Wireless Communication. Wireless communications networks are networks that require no

guided media like cables and fibre optics but unguided media. They are called unguided because
they need no physical device to link the nodes together but radiate or broadcast information in
many directions. Basically wireless communications employ the use of microwaves, satellites,
radio and infrared transmissions to transport packets of data from one location to another.
Data Processing. It is basically used to analyze, summarize, and convert data into useful
information. It may be automated and it runs on a computer. Data processing can be said as the
process of recording, analyzing, sorting, summarizing, disseminating and storing data.
Telecommunication: Telecommunication is the electronic movement of information from one
location to another. This involves setting up a computer network within the office (intranet) or
outside the office (extranet) to facilitate electronic dissemination of information,
teleconferencing and among stakeholders.
Voicemails: It allowed users and subscribers to exchange voice messages; that are used to select
and deliver voice information; and to provide transactions relating to individuals, organizations,
products and services, using telephone. It is used more broadly to denote any system of
conveying a stored telecommunications voice messages, including using an answering machine.
Computer Network: Computer network is a group of two or more computer systems linked
together. It is also said as the interconnection of two or more computer systems using data
communication system or devices. The interconnection of stand-alone of computers using
networking media and devices. There are many types of computer networks, including:
  Local-area networks: The computers are geographically close together that is, in the same
building.
 Wireless area networks: The computers are farther apart and are connected by telephone
lines or radio waves.
 Home-area networks: A network contained within a user's home that connects a person's
digital devices.
Facsimile Transmission (FAX): Fax is the telephonic transmission of scanned printed material
both text and images, normally to a telephone number connected to a printer or other output
device. The original document is scanned with a fax machine or a telecopier, which processes the
contents text or images as a single fixed graphic image, converting it into a bitmap, and then
transmitting it through the telephone system.
Electronic Data Interchange: It is simply said as computer-to-computer exchange of business
documents in a standard electronic format among business partners. Therefore by moving from
a paper-based exchange of business document to one that is electronic, businesses enjoy major
benefits such as reduced cost, increased processing speed, reduced errors and improved
relationships with business partners.
Electronic Fund Transfer: It enables bank to transfer funds from one bank to another within and
outside the bank. You can use electronic fund transfer to:
 Have your paycheck deposited directly into your bank or credit union checking account.
 Withdraw money from your checking account from an ATM machine with a personal
identification number (PIN), at your convenience, day or night.
 Instruct your bank or credit union to automatically pay certain monthly bills from your
account, such as your auto loan or your mortgage payment.
 To purchase groceries, gasoline and other purchases at the point-of-sale, using a check
card rather than cash.
Internet Security: It is provided to existing and potential customers of a commercial bank to
protect privacy and security of customer or clients while visiting and transacting business with
the bank on the internet.
 1. Identify and describe the IT systems used for their business to be successful and use your
case study company as an example.
2. Describe and evaluate the main advantage of using MIS in your case study business
environment.

Types of Information Systems in a Business Organization

With the previous definitions of information and systems we can now define a business
information system as a group of interrelated components that work collectively to carry out
input, processing, output, storage and control actions in order to convert data into information
products that can be used to support forecasting, planning, control, coordination, decision
making and operational activities in an organisation. In terms of the components that undertake
this activity, they can be classified into five basic resources of people, hardware, software,
communications and data. People resources include the users and developers of an information
system and those who help maintain and operate the system such as IS managers and technical
support staff. Hardware resources include computers and other items such as printers. Software
resources refer to computer programs known as software and associated instruction manuals.
Communications resources include networks and the hardware and software needed to support
them. Data resources cover the data that an organisation has access to such as computer
databases and paper files.
Executive support systems (ESS)
Designed to help senior management make strategic decisions. An ESS gathers, analyses and
summarises the key internal and external information used in the business. ESS typically involve
lots of data analysis and modelling tools, such as "what-if" analysis, to help strategic decision-
making.
Management information systems (MIS)
Primarily concerned with internal sources of information. MIS usually take data from the
transaction processing systems and summarise it into a series of management reports.
MIS reports tend to be used by middle management and operational supervisors.
Decision support systems (DSS)
Specifically designed to help management make decisions in situations where there is
uncertainty about the outcomes of those decisions.
DSS use tools and techniques to help gather relevant information and analyse the options and
alternatives. DSS often involves use of complex spreadsheet and databases to create "what-if"
models.
Knowledge management systems (KMS)
Exist to help businesses create and share information. They are typically used in businesses where
employees create new knowledge and expertise, which can then be shared by other people in
the organisation to create further commercial opportunities. Good examples include firms of
lawyers, accountants and management consultants.
KMS are built around systems which allow efficient categorisation and distribution of knowledge.
For example, the knowledge itself might be contained in word processing documents,
spreadsheets, PowerPoint presentations. internet pages etc. To share the knowledge, a KMS
would use group collaboration systems, such as an intranet.
Transaction processing systems (TPS)
Designed to process routine transactions efficiently and accurately.
A business will have several TPS; for example:
 Billing systems to send invoices to customers
 Systems to calculate the weekly and monthly payroll and tax payments
 Production and purchasing systems to calculate raw material requirements
 Stock control systems to process all movements into, within and out of the business
Customer Relationship Management Systems
Business owners use customer relationship systems to synchronize sales and marketing efforts.
CRM systems accumulate and track customer activities, including purchasing trends, product
defects and customer inquiries. The capabilities of typically CRM information systems allow
customers to interact with companies for service or product feedback and problem resolutions.
Businesses may also use CRM systems internally as a component of their collaboration strategies.
As such, CRM information systems allow business partners to interact with each other as they
develop ideas and products. Collaboration can occur in real time even when business partners
are in remote locations.
Hotel MIS
Need for information technology in the hotel industry (PMS, CRS and others) depends on
numerous factors that characterize this type of business. What is the hotel capacity increased,
number of departments, the number of reservations, the frequency of customers and others, the
greater is the need to use information technology that would significantly facilitate the
management of these processes.

The modules of information systems in the hotel business can be classified according to different
focuses on the system, by which is meant to focus on customers, operations, support and
services.
Modules facing clients are: booking, POS systems, clients loyalty program, Web portals, front
office systems and others.
Modules facing operations include: revenue management, inventory, purchasing and billing
applications, planning and others.
Modules facing support activities are: applications for human resources management, financial
applications, CRM solutions and others.

Service Modules are: online bookings, interface to the GDS systems and stakeholders portals and
others.
Two major integrated modules within the information systems that are discussed in
hotel business are:
• Property Management Systems, PMS
• Computer Reservation Systems, CRS

In bookkeeping phase of the introduction of information technology is focused on booking hotel

services and payment, on control inventory and accounting. This is followed by reducing the
required number of employees in a particular workplace, increase business efficiency and
improving the system of control of certain business operations.
In the administrative phase of information technology is used in the performance of a large
number of business operations, such as reservations, accounting, cash flow management, stock
control food and drinks, forming database of hotel guests and others. The results of the
application of information technologies for administrative purposes are visible the savings in
labor costs and the need for a smaller working capital. At the same time comes to increase the
quality of services and an increase in total revenue.

Hotel Splendid is one of the most impressive hotel on Montenegrin coast.

The hotel has 343 accommodation units with a variety of amenities: main restaurant, lobby bar,
Conference Bar, Pool Bar, Fine Dining restaurant, Fine Dining bar & lounge, Fine Dining roof top
terrace, Plazni Bar & restaurant, Business Center, Spa & Wellness center.

The system for asset management of the hotel (Property Management System, PMS) is a core
component of management's operations. PMS system provides tools that hotel staff needs in
performing daily activities, such as provisioning, check-out guests, the management of the
accommodation capacities, serving the needs of guests, accounting, etc.

The main functionality of PMS are:

Operational management of hotel business which includes:
- Operational planning and decision making (management of hotel operations, reports of guests
traffic, room service, etc.).
- Centrally manage and control business hotel (hotel chain management, unified control, etc.).
- Monitoring of operation of hotel’s warehouse (inventory tracking, receiving, inspection of goods
at the entrance, receipts, delivery notes, etc.).
Hotel maintenance jobs:
1) Operational maintenance (requisitions of tools and materials, fabrication and filling orders on
completed repairs and the calculation of the value of the works, izvrada certificate and return a
defective part, etc.).
2) Construction and craft works in the self-directed (planning, implementation and monitoring of
work, keeping a journal papers, monitoring of material consumption, etc.).
3) Maintaining hygiene of the hotel (the hotel and room cleaning, maintain the area around the
hotel, washing and ironing, etc.).
4) Facility Management (management of all devices and activities in the hotel, swimming pools,
gym, spa centers, etc.).
Accounting and bookkeeping jobs include hotel safes, material accounting in a hotel, an
integrated general ledger, support for working with multi-currency, multi-dimensional analysis
and others.
Front office (ie. Front Desk) includes:
Serving guests at the reception (provision and updating individual, group or business reservation,
cancellation, confirmation; waiting lists; blocking rooms; reception and accommodation of
guests, services and information, out, notice of defects, determining billing, invoicing, system
provisioning other activities hotel, rent a hall, sports facilities, equipment, monitoring valuable
goods, luggage, etc.).
-Kiosk (check flight, departure, stay, etc.).
-Sales and Marketing:
Sales and orders of services and capacity
Price Management (comparison and forecasting, statistics, etc.).
Campaign management (calendar, email client list, sending propaganda materials, notification of
the new conditions, etc.)
Catering and Events (scheduling, providing space and catering service, menu selections,
decorations, calendar plan, timeline review services, etc.).
Reporting and business intelligence enables the integration of data from various sources, create
reports, ad-hoc analysis, performance analysis business, track statistics reservations, finance,
guests, marketing, catering etc.
Gastro business activities includes: management of POS (Point-of-Sale), order management,
staff, setting the price, type of payment, reporting and others.
Reservation system (Computer Reservation System, CRS) is a central system hotel business,
which provides making reservations and tools to increase bookable overall income. Main
functionalities of the system are:
Reservations - handling all types of reservations (individual, group, business), review availability,
price, handling deposits, blocking the room,
Edit booking, cancellation provisions, the possibility of provision of transport, restaurants,
activities, etc.
E-commerce - 24/7 option of booking and paying electronically
Advantages of above systems:

 Comfortable invoicing
 Multi-Client_Capability Exceptional flexibility
 Flexibility
 Central and/or local administration
 Simple and intuitive usability
 Speedy check-in
 Easy and comfortable bill splitting
The biggest impact on the development of business in the hotel industry has left the development
of the Internet. The existence of inexpensive and complex computer and telecommunications
networks for transmission information, the whole world is linked in large unit share information
quickly. Today internet services, they are creating a global market for traffic and marketing of
goods and services. The advantages of using the Internet in the hotel industry are manifold:
reducing costs, increasing market, intensive marketing, the possibility of permanent interactive
communication with potential customers and partners etc. These are just some of the
advantages of this way of doing business in hotel industry.

Certainly the biggest advantage of the Internet in the hotel industry is the use of global
distribution systems and central reservation systems.

The use of information systems for the hotel industry can certainly be an asset improving
competitive advantage. ISs contribute significantly to improving the efficiency and effectiveness
of business operations, especially in large hotel where many activities take place regularly.
Starting from the easiest systems to integrate payment at one point of sale, managing costs and
passages, accounting or accommodation, to the reservation system, linking with other hotels and
suppliers, managing inventory, etc. information systems have an important role in the Marketing
field. Tourism is a market full of information, and the majority of companies are in close touch
with their clients, which enable them to acquire knowledge about their needs and desires.
Tourism companies, especially hotels, with the help of Information system can collect, store and
analyze information about users systematically and in order to improve product quality, faster
response to changing requirements customers, and ensuring customer loyalty.

The main objective of the implementation of information systems in the hotels is actually better
meeting the needs and desires of consumers. Although the tourist market differs in different
parts of the world, what is common to all business strategy is that faces to customer as the key
to success. Building a better way to consumers, is considered one of ways to gain a competitive
advantage in any market. One of the noticeable trends in the hotel industry is the need for faster
and easier performance of business operations, which is why a large number of hotel decided to
deploy information system that will provide faster performance with less errors and omissions.

Information systems not only help employees with work more efficiently, but also management
in the field of control and better availability of information. One of trends is certainly the
introduction of restaurant information systems that facilitate the ordering process and control
of materials and supplies. Hotel Splendid is one of the successful examples of how to raise the
quality of the hotel services application modern information and communication solutions.