Management Information System at Multinational Company A Case study of: DHL®

Submitted by, KCB ID: 11305 Course: MBA in Marketing

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MIS (Management Information System)

Managing information is the process of the strategic management of all the information from

the various parts of the organization. An organization needs the information from its various

parts and need to clarify them in supporting the decision making for that company.

Laudon, K. and Laudon, J. (2007) in their book of, Management Information System, has

elaborated the definition of MIS as, “Management information system works at the levels of

management of any strategic organization and serve it with the functions of planning,

controlling as well as decision making with the providing of the routine summary and also

the exception reports”

An organizational management level may be classified in the following three tiers :

1. Operation level: keep track the core operations of the company and deals with various

departments like, customer service, cashier, production, order processing etc.

2. Managerial level: Company’s various levels of information are managed in this level,

e.g., sales management, sales analysis, inventory control, relocation of cost control,

budgeting for the company etc.

3. Executive level: the top level management resides here and they are to take the strategic

decision, long term plan, sales trend forecasting, personnel planning etc.

Figure 1: Interrelations among Information technologies.

(O’Brien, J (1999). Management Information Systems – Managing Information

Technology)

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Figure 2: Functional areas of MIS

(Laudon, K. & Laudon, J. (2007) Management information system)

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A Case Study: DHL®

(An express logistics company)

DHL express is a subdivision of the Deutsche Post that provides the international services. It

was founded in the early 1969 in the aim of delivering documents from San Francisco to

Honolulu. The company later has expanded its services throughout the world in later 1970s.

The prior interest of the company was the intercontinental package deliveries. But the success

of the FedEx has prompted them in its expansion in the US that had started in the 1983. In the

current times, DHL is aggressively expanding to the different countries where it could not be

served by the other delivery or courier services. This region includes the Eastern bloc, PRC

(People republic of china) and Vietnam. In the year of 1998, Deutsche post had begun the

acquiring the shares of DHL and finally in the year of 2001 it had reached its ownership

status of DHL. At present, DHL express is sharing the well known DHL brand in conjunction

with DHL global forwarding and freight and the DHL supply chain.

IIS (Integrated Information System) at DHL

DHL is highly known as it uses the technology innovatively and for its fast and reliable

services. As DHL is mainly a service based company for the shipments and transport of

various goods worldwide, it needs information from the entire sector of the company,

specially form its operational sector. These information helps the company mainly in track

and trace types. So the ultimate goal is better strategic customer services and support in

logistics support.

IT Solutions at DHL®

To adopt and implement better services, DHL has enabled the Cisco solutions to improve

better communications and for better operations e.g., telephone system management,

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maintenance etc. Through the creation of single network and the communication

infrastructure, DHL has been helped by Cisco to improve communications over various sites

and manage them in a very strategic way. For example, the employees of the DHL are able to

call any locations worldwide by simply using the extension and outbound calls. Through this

Cisco solution, corporate directory are easily accessible ever from the handset.

DHL is currently planning in leveraging the Cisco SONA framework through the using of the

network in deploying the additional business applications. Additionally DHL is also setting

up RFID (Radio frequency Identification) over the existing Cisco network for further and

improving its operations.

MIS (Management Information System) at DHL®

At present information technology are crucial for any company background to fulfil the

business role effectively. In respect to the DHL they are highly information intensive

company where in every aspect they have to practice information most effectively.

Organization information backbone can be categorized in three tiers of management

according to the information provided for the strategic decisions to be made.

a. Operational information management

DHL’s operational information is mainly in relation with the freight and logistics. They

need the current and updated information about the goods, customer, location, condition

etc. To achieve this target it has developed and implemented a number of solutions in its

operational level of management.

i. Kofax (Scanning software): One of the main duties of the staff at DHL is to scan

the tag of goods to track the information and process them through IBM® DB2

content manger. But this system has proven to be unstable and was found to be hit

by number of viruses.

Later through the establishment of Kofax, they have got remedy from this unstable

and bizarre situation. Now they are able in managing the information and getting

approval of more than 5,000 invoices every week.

ii. Siebel solution: A software solution developed by Oracle® for DHL to unify the

customer information and in creating a single, global and also a multichannel view

of every customer relationship. Siebel system also assists DHL in the execution of

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compelling, multichannel marketing programs that are aimed at the maximization of

the demand for the domestic and in international express services.

This CRM application plays the vital in collecting the information about the

customer about their choice. Through providing a clear and transparent view, DHL

had achieved approximately 1% increase in its revenue in the year 2005. This

Oracle® solution has reduced the sale time, administrative time etc. too.

iii. Forwarding and Freight: This department of the operational level are responsible

in carrying goods through railway, road transport, air and sea. The three main

business units are,

a. DHL Global forwarding: It handles the global ocean and air freight.

b. DHL Freight: It runs the ground based and freight network that covers the

whole Europe, Russia and in the middle-east.

c. DHL Supply chain: Provides service in warehousing and the warehouse

transport and the value added solutions and also for the customers in wide

variety of sectors.

b. Managerial information management

In this managerial level of information management, DHL gathers information from its

lower, operational level system to facilitate its decision support system (DSS). In the past

the company were managing the logistics through off-the-shelf warehouse applications

that were run on the legacy microcomputer platform.

i. Progress® Open hedge: In 1998 it has realized and the management level has

decided to use the Progress® Open hedge legacy software platform to build the

custom applications in house.

ii. WMS (Warehouse management system): DHL’s Management have selected the

WMS system provided by WICS, a partner of Progress®. This warehouse

management system is featured with the vast flexibilities. It offers DHL, fully

featured support in bar coding and the RF technologies. It also supports DHL in the

centralized tracking of its inventory from the receipt through the distribution and the

delivery. Nowadays, when any goods are received in purpose of storage, the WMS

are able to generate labels and this is used in uniquely identifying pallets and then

the system allocate the available storage. (http://www.progress.com/worldwide)

iii. Citrix®: Improved architectural frameworks that are used and set up by the

managerial level in improving the stability and the scalability as well as increasing

IT support efficiency. (www.citrix.com)

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iv. Telecommunication network: DHL has managed two of the independent

Metropolitan area networks (MANs) to provide itself with higher available and the

resilient IP. Its telecommunication network has connected its IT service centre to the

domestic and international telecommunication partners.

v. Inventory management: Most of the inventories are not in a directly tied in

finished product of the overnight shipping but helping to maintain the smooth

system. More than hundreds of the supplies are kept on hand if there is any

unforeseen problem happens. (www.DHL.co.uk/press)

c. Strategic information management

The strategic level of the DHL require strategic information in setting up the company’s

aim and target, long term planning strategy, marketing solution etc.

i. Merger & Acquisition: In 2005 Deutsche post that have acquired DHL before,

acquired Excel in December. Following the merger the company were became the

world’s largest logistic company. But however, the business was divided in between

them, e.g., DHL for air and ocean and Excel for freight management. They then

combined to form DHL logistics. In 2006 DHL global mail UK was merged with

Mercury international. (http://www.deutschepost.de/dpag?lang=de_EN)

ii. Human resource: DHL have a very strategic and efficient and highly skilled

manpower. In the year of 2005 it has employed more that 600 skilled IT

professionals. Major employee was taken from the Czech nationals. In this year,

they have set up more than 500 servers and configured in enabling the migration of

processing of the business transactions from its data centre in UK, Basel,

Switzerland etc.

iii. EDS: Over the times, as the current businesses of DHL have expanded and in

therefore, the planning, air execution, road transportation etc. became increasingly

complex. Different functions of DHL e.g. dispatch, movement control, planning for

load was supported by the aged technologies and the information exchange, data

visibility were affected. In this situation, DHL has set up the Business area review

(BAR) programme in aiming reducing cost etc. And in this condition DHL were in

need support from the EDS, have worked jointly with DHL in setting up the highly,

scalable and strategic technical atmosphere.

iv. Human resource: At the DHL teamwork is considered as the key success for the

company. Though the employee work individually but their works are toward a goal

for success for the company. At the DHL hub, the work strategy is designed such a

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way to help maintaining the efficient work environment that supports the business

strategy. DHL are always fond to keep its employer happy in accordance with the

human resource management.

v. Planning and Scheduling: At the DHL, operations in its managerial level are

planned through the chase and demand approach. Key resource should be planned in

staffing properly. In the peak time of year, staffing is the main concern for the

management level. If the system is understaffed, there may be the chance for the

system to run in late that acts as the delay in delivery of the shipments to its

customer. The other key factor which should be scheduled in every night and day is

the operation of aircrafts in inbound and outbound. Having such a large fleet, they

are scheduled for the maintenance at the routine basis. These aircrafts are then need

to be replaced with the backup aircraft to continue the process as normal.

vi. Quality management: In the back 1997, DHL became and ISO9002 certified

signalling to their customers that are pledged to deliver the packages in accordance

of the worldwide standard of handling and the methods of delivery. In the past years

a newer management were placed in controlling the hub and the total quality

management were introduced from then. In that time tracking of the shipment was

not an easy task in comparing to the present.

Conclusion

DHL and the information technology are highly integrated in its core business framework.

All critical and complex information are efficiently and effectively are managing through the

adoption and implementation of modern information technology. In review of the company

DHL, it has been found that greatest success rate is achieved through the information

technology and its strategic management. The company are found in implementing the

purposes of strategic decision making in the aim of budgeting, forecasting, financial review

etc. and all the other information management are exercising in the managerial and in its

operational level for better strategic development and success.

Thus the implementation of MIS and proper exercise of it will lead to more success of DHL

as well as for other companies.

References

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Elliott, G. (2004). Global business information technology: an integrated systems approach.

Harlow: Addison Wesley

Fattahi. R and Ebrahim Afshar (2006), ‘Added value of information and information

systems: a conceptual approach’, Library review Vol. 55 No. 2, 2006 pp. 132-147

Laudon, K. & Laudon, J. (2007) Management information system, 10th

Edition, Prentice

Hall.

O’Brien, J (1999). Management Information Systems – Managing Information Technology

in the Internetworked Enterprise. Boston: Irwin McGraw-Hill. ISBN 0071123733.

Online links,

(http://www.progress.com/worldwide)

(www.citrix.com)

(http://www.deutschepost.de/dpag?lang=de_EN)