Management Information Systems

1. Management Information Systems Overview MIS Inputs Functions Characteristics MIS - Outputs Competitive Advantage

3. MIS in Perspective Without these reports, we’d be as dumb as we look. Primary Purpose of an MIS: • To provide managers with information (reports) for effective decision making and feedback on daily operations. We are the bad guys from Bad Guy’s Auto.

4. MIS Outputs (Reports) We use these reports: • scheduled reports, • key-indicator reports, • demand reports, • exception reports, and • drill-down reports. I get turned on by demand reports.

5. MIS Scheduled Reports For us, a scheduled report might show how many cars were return last week because of serious defects. Just what is a scheduled report for us at Bad Guy’s Auto? Scheduled Report: • Reports which are produced on a schedule: • Daily, weekly, monthly, quarterly, semiannually, and annually.

6. MIS Scheduled Report Scheduled Report Weekly Defect Report Week Ending November 22, 2020 Condition Sold ReturnsMinor SeriousStatus 216 129 19 110 Normal( >50%)

7. MIS Key-indicator Report For us, a key-indicator report would be the number of defective cars we sold at our daily auction. What is a key- indicator report for us at Bad Guy’s Auto? Key-indicator Report: • A special type of scheduled report. • Daily reports which summarize the previous day’s critical activities. • Usually linked to critical success factors.

8. MIS Key-indicator Report Key-indicator Report Daily Auction Report Week Ending November 22, 2020 Qty AmountAs IsStatus 24 $34,023 23 Normal

9. MIS Demand Reports Last week I demanded a report showing the revenues for salvaged cars over the last 10 years. Tell us how we use demand reports. Demand Report: • A non-scheduled report needed at the moment by management. • A report produced on demand.

10. MIS Demand Reports Demand Report Salvage Revenues (10 yrs.) Report Week Ending November 22, 2020 Cars Lost to Salvage Quanty Amount 24,524 $341,023

11. MIS Exception Reports If we have fewer than 50 percent returns because of defects, an exception report is generated. Exception Report: • A report automatically generated when an unusual event takes place, which usually requires management action. Tell us how we use exception reports.

12. Exception Defect Report Week Ending November 27, 2020 Condition Sold ReturnsMinor SeriousStatus 126 5 4 1 Abnormal ( <50%) MIS Exception Reports Yes Sir, I saw the exception report. Could it be that we are paying too much for our cars?

13. MIS Drill-Down Reports Let’s use drill down reports and find out why earnings are up so much. Drill Down Reports: • These reports provide increasingly detailed information about a situation. I can’t understand it. Our earnings are up 25% for the quarter.

14. 1st Level Earnings by Quarter (Millions) Actual Forecast Variance 2nd Qtr. 2020 $12.5 $10.0 25.0% 1st Qtr. 2020 $10.8 $10.7 0.9% Sales and Expenses (Millions) 2nd. Qtr. Actual Forecast Variance 2nd Level Gross Sales $112.5 $100.0 12.5% Expenses $100.0 $90.0 11.1% Profit $12.5 $10.0 25.0% MIS Drill-Down Reports 3rd Level

15. Sales by Salesperson (Millions) Actual Forecast Variance Adams, Tom 5.5 $5.2 5.7% Jones, Paul $6.2 $6.0 3.3% Kim, Jim $2.3 $2.5 -6.7% Robbins, Julia $15.0 $1.5 900.0% Etc. ……. ….. ……..% 3rd Level MIS Drill-Down Reports Julia Robbins

16. MIS Drill-Down Reports Bad G Boys, as you can see. I’ve got what it takes.

17. MIS Inputs Our inputs are internal data and external data. Inputs to an MIS: • Internal Data(Always used) • TPS - Transaction Processing System • External Data (Could be used) • Customers, suppliers, competitors, marketplace, etc. What are the inputs to our MIS.

18. The End of the Bad Guy’s Sir, five people from the State’s Attorney’s Office are here with warrants for your arrests. They’re accusing you guys of consumer fraud. Bye, bye bad guy’s.

19. Basic Reports Standardized and Fixed Report Formats Drill Down Reports Scheduled Reports Exception Reports Demand Reports Characteristics of an MIS 1st Characteristic

20. Use Internal Data Stored in the Computer System Characteristics of an MIS 2nd Characteristic

21. Systems Analyst Programmer Characteristics of an MIS 3rd Characteristic MIS systems are developed & implemented by IS personnel, not users. Users help in the design.

22. MIS systems require formal requests from users. Oh please accept this written request. Characteristics of an MIS 4th Characteristic

23. Travel Agent MIS for a Competitive Advantage American’s Sabre System Sabre American Flights Sabre System: • American’s flights came up first. • Gave American too much advantage. • Legal problems.

24. Hospital purchasing agent MIS for a Competitive Advantage American Hospital Supply’s System Welcome American Hospital Supply American Hospital Supply System (AHS): • Online order entry system. • AHS now dominates hospital supply market.

25. MIS R&D MIS Business trans-actions HR MIS Transaction Data Marketing MIS TPS Financial MIS Manufacturing MIS External Data Other ... MIS Functional Organization of MIS Non-integrated MIS Sub-systems

26. Shared reports Shared reports Shared reports Tactical reports Tactical reports Tactical reports Operational reports Operational reports Operational reports Strategic reports Strategic reports Strategic reports Functional Organization of MIS Manufacturing MIS systems and databases Integration by Common Database Database Marketing MIS systems and databases Other MIS systems and databases

27. Manufacturing MIS (Inputs) Inputs to the Manufacturing MIS: (1) Strategic Plan: • Quality goals • Production goals • Customer Service goals • Constraints

28. Manufacturing MIS (Inputs) Inputs to the Manufacturing MIS: (2) The TPS: Receiving and Inspecting Data • Receiving Department. • Inspects, accepts, and delivers to depts. • Quantity, quality, and arrival of raw materials. • Reports used to monitor suppliers.

29. Manufacturing MIS (Inputs) Inputs to the Manufacturing MIS: (3) The TPS: Inventory data. • Quantity on hand, use of raw materials, work in process, and finished goods. • Reports used to reorder, identify shortages, surpluses, poor quality, and for tracking.

30. Manufacturing MIS (Inputs) Inputs to the Manufacturing MIS: (4) The TPS: Personnel data. • Labor data using salaries, time cards and industrial data collection (time study info) devices. • Reports used to estimate labor costs and develop time schedules.

31. Manufacturing MIS (Inputs) Inputs to the Manufacturing MIS: (5) The TPS: Order Processing. • Placing, canceling, and making adjustments to orders.. • Reports used for production scheduling, labor and raw material requirements. • Could be hooked to EDI.

32. Manufacturing MIS (Inputs) Inputs to the Manufacturing MIS: (6) External sources: • New manufacturing and design techniques collected from outside companies, journals, seminars. • Prediction of labor and material costs from labor supply and inflation data.

33. Manufacturing MIS (Subsystems) Manufacturing MIS subsystems: (1) Design and Engineering • CAD - Computer-Assisted Design • Aids in the design of new products. • Aids in updating existing products. • Used to analyze problems with existing products. CAD AutoCAD

34. Manufacturing MIS (Subsystems) Manufacturing MIS subsystems: (2) CAM (Computer Assisted Manufacturing). • Computers that directly control production equipment: • Robots. • Drilling Machines. • Welding Machines. • Assembly Lines. • Have self-diagnostic routines. • Usually easy to program.

35. Manufacturing MIS (Subsystems) Manufacturing MIS subsystems: (3) Master Production Scheduling • Provides a detailed plan for every item to be manufactured. • Indicates the quantity to be produce by time period, such as, the disks below.

36. Manufacturing MIS (Subsystems) Manufacturing MIS subsystems: (4) Inventory control • Automatic reordering, forecasting, shop reports and documents. • EOQ- Economic Order Quantity. • ROP- ReOrder Point. • MRP- Material Requirements and Planning. More

37. Manufacturing MIS (Subsystems) Manufacturing MIS subsystems: (4) Inventory control • MRPII - Manufacturing Resource Planning, which focuses on three questions for finished products: • What does the customer need? • Demand forecasting. • What do we have in inventory? • Inventory control. • What should we make? • Production planning. More

38. Manufacturing MIS (Subsystems) Manufacturing MIS subsystems: (4) Inventory control • MRPII - Manufacturing Resource Planning, which focuses on three questions for unfinished products: • What materials are needed? • Bill of materials. • What do we have in inventory? • Inventory control. • What do we have to get? • Supply planning. More

39. Lucent Technology’s Inventory Control system

40. Manufacturing MIS (Subsystems) Manufacturing MIS subsystems: (4) Inventory control • JIT - Just-In-Time • Materials and supplies are delivered JUST in time for use. • Auto industry approaches zero inventory. • Has been very successful.

41. Harley Design Manufacturing Shipping Order Processing Inspection Manufacturing MIS (Subsystems) Manufacturing MIS subsystems: (5) CIM(Computer Integrated Manufacturing). • CIM’s goal is to tie all aspects of production together. CIM

42. Manufacturing MIS (Subsystems) Manufacturing MIS subsystems: (5) CIM(Computer Integrated Manufacturing). • CIM’s goal is to tie all aspects of production together. Play Nucor Steel video-1. (11 minutes) Play Nucor Steel video-2. (5 minutes)

43. The End