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Logical Components of a Business Process Summary

A business process is composed of three key components: Information Process, Operations Process, and Management Process, all supported by Information Systems to ensure efficiency and effectiveness. Data and information are distinct, with information being processed data that aids decision-making, while good information must possess qualities such as accuracy, reliability, and understandability. Businesses must balance the costs and benefits of information, prioritizing certain qualities over others due to inherent conflicts.

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4 views

Logical Components of a Business Process Summary

A business process is composed of three key components: Information Process, Operations Process, and Management Process, all supported by Information Systems to ensure efficiency and effectiveness. Data and information are distinct, with information being processed data that aids decision-making, while good information must possess qualities such as accuracy, reliability, and understandability. Businesses must balance the costs and benefits of information, prioritizing certain qualities over others due to inherent conflicts.

Uploaded by

hitsugayawave
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Logical Components of a Business Process

A business process consists of three key components that work together to support
logical activities. Information Systems (IS) play a crucial role in all three by implementing
policies and procedures that define each process.

1. Information Process
• The part of the IS related to a specific business process.
• Plays a critical role in linking and supporting the other two processes.
• Ensures smooth data flow and decision-making.

2. Operations Process
• Involves people, equipment, policies, and procedures that help the
organization complete its work.
• A human-made system responsible for tasks like manufacturing, distribution,
and human resources.
• Ensures the daily business functions run efficiently.

3. Management Process
• A human-made system focused on planning and controlling operations.
• Involves people, authority, organization, policies, and procedures to guide the
company.
• Ensures the business meets its goals through strategic decisions.

Conclusion
These three processes work together to achieve the business objectives, ensuring the
organization functions effectively and efficiently.
Data vs. Information

Data
• Raw facts or figures that represent measurements or observations.
• Unprocessed and does not provide meaningful insights on its own.

Information
• Processed data presented in a form that aids decision-making.
• Reduces uncertainty and increases knowledge about a specific concern.

Qualities of Good Information


• Confidentiality – Ensures that sensitive information is protected from
unauthorized access.

• Effectiveness – Meets the needs of decision-makers and supports business


goals.

• Efficiency – Delivered in a cost-effective manner without unnecessary delays.

• Availability – Accessible when needed by authorized users.

• Compliance – Adheres to laws, regulations, and organizational policies.

• Integrity – Maintains accuracy and consistency throughout its lifecycle.

• Reliability – Can be trusted for decision-making without bias or errors.

• Understandability – Clear, well-organized, and easy to interpret.

• Predictive & Feedback Value – Helps forecast trends and evaluate past
decisions.

• Comparability – Can be analyzed against similar data for insights.

• Accuracy – Free from errors, ensuring precise and correct details.

• Completeness – Contains all necessary data without missing elements.


Cost and Benefits of Information
Information provides value, but it also comes with costs. Businesses must balance the
benefits of high-quality information with the resources needed to obtain it.

• Benefits – Better decision-making, reduced uncertainty, increased efficiency.

• Costs – Time, money, and effort required to collect, process, and maintain
accurate data.

Conflicts Among Information Qualities


It’s impossible to have all qualities of information at once! Some qualities conflict with
each other:

Speed vs. Accuracy – Faster data collection may lead to errors.


Security vs. Availability – Highly secure information might be harder to access.
Detail vs. Understandability – Too much detail can make information harder to
interpret.

Prioritizing Information Qualities


Since conflicts exist, businesses must prioritize which qualities matter most:

Accuracy first? – If precision is key, we might sacrifice timeliness.


Timeliness first? – If quick decisions are needed, we may allow minor errors.

A hierarchy helps define which qualities take priority based on the organization's
needs.

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