The level of success of EIS is affected by several factors. These factors may primarily be associated with two phases of EIS implementation: the initial EIS development process and EIS operation.

 

Not a piece of hardware or software, but an infrastructure that supplies to a firm's executives the up-to-the-minute operational data, gathered and sifted from various databases.

Executive Information Systems


Definition: An Executive Information System (EIS) is a set of management tools supporting the information and decision-making needs of management by combining information available within the organisation with external information in an analytical framework.

 

Executive Information Systems
 


EIS are targeted at management needs to quickly assess the status of a business or section of business.  These packages are aimed firmly at the type of business user who needs instant and up to date understanding of critical business information to aid decision making.

The idea behind an EIS is that information can be collated and displayed to the user without manipulation or further processing. The user can then quickly see the status of his chosen department or function, enabling them to concentrate on decision making. Generally an EIS is configured to display data such as order backlogs, open sales, purchase order backlogs, shipments, receipts and pending orders. This information can then be used to make executive decisions at a strategic level.

The emphasis of the system as a whole is the easy to use interface and the integration with a variety of data sources. It offers strong reporting and data mining capabilities which can provide all the data the executive is likely to need. Traditionally the interface was menu driven with either reports, or text presentation. Newer systems, and especially the newer Business Intelligence systems, which are replacing EIS, have a dashboard or scorecard type display.

Before these systems became available, decision makers had to rely on disparate spreadsheets and reports which slowed down the decision making process. Now massive amounts of relevant information can be accessed in seconds. The two main aspects of an EIS system are integration and visualisation. The newest method of visualisation is the Dashboard and Scorecard. The Dashboard is one screen that presents key data and organisational information on an almost real time and integrated basis. The Scorecard is another one screen display with measurement metrics which can give a percentile view of whatever criteria the executive chooses.

Behind these two front end screens can be an immense data processing infrastructure, or a couple of integrated databases, depending entirely on the organisation that is using the system. The backbone of the system is traditional server hardware and a fast network. The EIS software itself is run from here and presented to the executive over this network. The databases needs to be fully integrated into the system and have real-time connections both in and out. This information then needs to be collated, verified, processed and presented to the end user, so a real-time connection into the EIS core is necessary.

Executive Information Systems come in two distinct types: ones that are data driven, and ones that are model driven. Data driven systems interface with databases and data warehouses. They collate information from different sources and presents them to the user in an integrated dashboard style screen. Model driven systems use forecasting, simulations and decision tree like processes to present the data.

As with any emerging and progressive market, service providers are continually improving their products and offering new ways of doing business. Modern EIS systems can also present industry trend information and competitor behaviour trends if needed. They can filter and analyse data; create graphs, charts and scenario generations; and offer many other options for presenting data.

There are a number of ways to link decision making to organisational performance. From a decision maker's perspective these tools provide an excellent way of viewing data. Outcomes displayed include single metrics, trend analyses, demographics, market shares and a myriad of other options. The simple interface makes it quick and easy to navigate and call the information required.

For a system that seems to offer business so much, it is used by relatively few organisations. Current estimates indicate that as few as 10% of businesses use EIS systems. One of the reasons for this is the complexity of the system and support infrastructure. It is difficult to create such a system and populate it effectively. Combining all the necessary systems and data sources can be a daunting task, and seems to put many businesses off implementing it. The system vendors have addressed this issue by offering turnkey solutions for potential clients. Companies like Actuate and Oracle are both offering complete out of the box Executive Information Systems, and these aren't the only ones. Expense is also an issue. Once the initial cost is calculated, there is the additional cost of support infrastructure, training, and the means of making the company data meaningful to the system.

Does EIS warrant all of this expense? Green King certainly thinks so. They installed a Cognos system in 2003 and their first few reports illustrated business opportunities in excess of 250,000. The AA is also using a Business Objects variant of an EIS system and they expect a return of 300% in three years. (Guardian 31/7/03)

An effective Executive Information System isn't something you can just set up and leave it to do its work. Its success depends on the support and timely accurate data it gets to be able to provide something meaningful. It can provide the information executives need to make educated decisions quickly and effectively. An EIS can provide a competitive edge to business strategy that can pay for itself in a very short space of time.