Use Of Financial Information Systems To Support Senior Managers In Planning And Controlling Activities

In the financial industry, the financial information system is a well-thought-out approach for understanding and gathering information about financial activities. Managers and executives demand timely and reliable financial information in order to make business choices about the company's operations and strategies, which is why a financial information system is vital to the success of a corporation. When it comes to business, financial information is largely used to evaluate and analyse the activities and economic business position of a company, as well as to assist in the formulation and implementation of business choices and investments. In order to effectively manage and oversee the organisation, financial information is sent to senior management. If a company wants to be successful, it must have a strong financial statement to support it.

Using financial productivity software such as spreadsheets, graphics, and word processing programmes, business owners and managers can better control and plan their operations. Making a business decision requires the usage of software and technology, which is why managing directors utilise them. Information systems are primarily used for storing critical firm data, which can then be accessed by managers for the purposes of regulating, evaluating, and making business choices (Sledgianowski, Gomaa and Tan, 2017, p.87).

Manufacturing facility managers utilise electronic information systems to automate production operations and keep track of the amount of inventory on hand at their facilities. In the factory, information systems are used for a variety of tasks, including processing customer orders, billing, and vendor payments. In addition, banks utilise information systems to process commercial money transfers such as deposits, loan payments, and ATM card withdrawals, amongst other things. The majority of the time, systems are used by managers to retain company records, to transmit information to the appropriate persons, and to track the money that is provided or received.

When it comes to processing commercial transactions, several different information systems are used by different firms. Directors provide assistance for information systems and assist senior management in the preparation of predictions, the modelling of business strategies, and the identification of business trends based on the data studied. The flow of communication between employees in the entire business is greatly improved as a result of the office automation systems in place. Each system is designed to support a distinct level of decision-making: tactical, strategic, and operational. The following are examples of how managers and businesses use information support systems in the control and planning of their business operations.

Transaction processing systems (TPS) are software that allows us to process transactions.

For the integration of the company's information system, it is necessary to start with the transaction processing system. Transaction processing systems receive raw data from a variety of sources, both external and internal, which they process. Data is prepared and stored in databases, which are similar in appearance to microcomputers but are significantly greater in size and capacity. When it comes down to it, all of a company's vital data is mostly saved in a vast database that later serves as the organization's key information resource. In the event of a crisis, database management systems aid senior executives in keeping track of firm information and making that information readily available when the need arises.

Database updates are carried out using two alternative methods: batch processing and real-time updating (online updating). When new data becomes available, batch processing is the act of processing it in batches over a period of time as it becomes accessible. It makes use of the efficiency of computer resources as well as the best applications, such as payroll processing, that do not demand the continuous processing of information, such as payroll processing. The online processing of data ensures that the company's information is always up to date. In the event that a person books an airline flight and receives confirmation, information about the reservation is entered into the airline's information system as soon as it is received. Batch processing is less expensive than online processing, thus firms should consider the benefits of batch processing against the drawbacks of online processing before deciding which method to use (Richards et al., 2019, p.192).

Decisions as decision-support systems in management

Back-office duties such as order processing, final reporting, and accounting are made easier by transaction processing systems (TPS). TPS automate processes such as these and other back-office tasks. They make it possible for information to be processed quickly. Analysis is performed on the internal master database that is used by management support systems to assist senior managers in making better decisions.

Information technologies, such as data warehousing, are examples of more advanced management support systems. A data warehouse consolidates numerous firm databases into a single central database that is used to support decision-making management in the organisation. Senior managers benefit from data warehouses because they can share and easily access data throughout the entire firm while also receiving a comprehensive overview. The data warehouse is responsible for supplying information to top management and other users, maintaining data in the warehouse, and developing software to extract information from operational databases. They are more efficient in analysing data than transaction-processing systems. Data marts are housed within a data warehouse and are concerned with a certain type of data. Data warehouses are used by senior executives to store, gather, and evaluate information.