Introduction to Management Information Systems
3. American Can Company announced that it was interested in acquiring a company in the health maintenance organization (HMO) field. Two decisions were involved in this act:
The company may opt for a firm in the HMO field because they are deal with low-cost insurance covers meaning that the potential market is vast and steadily growing despite the presence of competitors such as preferred provider organizations (PPOs). The resolution could have been prompted by the need to diversify operations, which would assist in spreading the operational risk for the company.
The decision of which HMO to acquire. How can the use of BI help the company in this endeavor?
The American Can Company may choose to acquire HMO firms such as Harmony Inc., Kaiser Permanente or Anthem. However, the decision would rely on factors such as the financial performance in terms of profit ratios, cash flow, and indicators of efficiency. Using BI would assist American Can Company to identify the gaps in the presented information while identifying any irregularities that may arise in the process in terms revenue, structure and productivity. It further allows American Can to make a decision faster because it will process the available information almost instantly.
4. Discuss the Strategic benefits of BI Systems
Business intelligence (BI) refers to the analytical data collected through a software and tallied into reports after application of some cognitive factors mixed with artificial intelligence in an attempt to support the business management (Ranjan, 2009). BI has become prevalent in most industries because it has proven to be an essential tool for the improvement of the performance of the enterprise.
This system has had numerous benefits some of which include reduction of the costs of labor because BI saves on time while going through volumes of data. The automation and aggregation of collected data lead to the generation of a report, all of which could have taken some workers to conduct. Another benefit is the reduction of information overflows that result in bottlenecks. The information computed by the BI could take the finance and IT staff much more time to handle successfully. Among the ultimate benefits are better and faster processes of decision making. The resolutions from BI can be argued to be better because it is usually provided with data that is updated and well researched. As for the faster decisions, this benefit is realized because of the combination of multiple data processing tools and the system’s analytical pace, which leads to a quick response time. The final benefit to be discussed in reduced waste in the company operations because it points out the process weaknesses and gaps that arise.
