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Management Information System

Management Information System. Trends in Business and Management. Blurring of industry boundaries Deregulation of industries Faster pace of business Increasing foreign competition Global Business Community An Information Society Increasing complexity of management

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Management Information System

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  1. Management Information System

  2. Trends in Business and Management • Blurring of industry boundaries • Deregulation of industries • Faster pace of business • Increasing foreign competition • Global Business Community • An Information Society • Increasing complexity of management • Interdependence of organization units • Improvement in productivity • Availability of computers of end users • Recognition of information as a resource

  3. Poorly defined or undefined Unstructured Strategic Planning Top Mgmt. Kind of Problems Mgmt. Control & Tactical Planning Middle Mgmt. Data requirement Operational Planning & ControlOperational Mgmt. Transaction ProcessingOperational Personnel Structured Problems Well defined Management Hierarchy & Information Flow

  4. Important Activities in Business • Problem Solving • Decision Making • Methods of Decision Making • Matrix Pairs of conditions and actions • Decision Tables Section from set of actions conditions in the form of rule. • Flowchart • Decision Tree Selection of Path • Pseudo Code If-Then form

  5. Some Optimization Techniques for Decision Making • System of equation • Linear programming • Integer programming • Dynamic programming • Queuing models • Inventory models • Capital budgeting analysis • Break-even analysis

  6. Statistical Techniques • Sampling • Probability distributors • Regression and correlation analysis • Testing of hypothesis

  7. Gather intelligence about Problem Develop alternative Select an alternative Implement the solution Monitor situation & results Components of Problem Solving Process Problem Solving Process Choice Selection Process Decision Making Process

  8. Gather intelligence about Problem Existing Information System (TPS, MIS) Develop alternative Expert Systems Engineering Systems Graphic Systems Select an alternative Spread Sheet Programs Statistical Packages Financial Management Packages Implement the solution Project Management Software Personal Database Application Monitor situation & results Existing & New Information System IS and Problem Solving Stages

  9. Information System • An Information System is a set of people, data and procedures that work together to provide useful information.

  10. Vision of Role of IS • Information Technology Vision • Strategic Business Vision Creating new business opportunities; New Products New Services Enter New Industry Improved performance in current industry BUSINESS VISION Information System Capability enables Business Vision Software Data Communication Data Hardware Combined knowledge of Business Environment & Information System Business Environment

  11. Activities in Information System Input of Data Processing Procedures Reports Sales Analysis Sales history Inventory Report Customer History Sales Details Payment Details Sales Returns Adjustments Database Document Customer Data Sales Data Inventory Data

  12. Information Systems should inform Managers not overwhelm them: Seven types of Information for Top Managers (imp)

  13. Different Types of IS (studied fr ERP notes only) • Transaction Processing System • Process data about transaction. • Management Information System • Provides information for decision support where information requirement can be identified in advance. • Decision Support System • Assist managers with unique strategy decisions that are relatively unstructured.

  14. Different Types of IS • Executive Support System • Assists Top-level executives in acquiring & using information needed to run the organization. • Work-group Support System • Assists and supports managers, staff and employees in carrying out day-to-day activities. • Expert System • Use of computer programs to store facts & rules to mimic the decision of human expert.

  15. Benefits of IS (imp) • Gain in Productivity • Increase in efficiency of the task. • More work completed with same or fewer resources. • Improvement in Effectiveness • Doing the right thing. • Utilization of resources to produce desirable results of high quality. • Gain in Competitive Advantage • Selecting & implementing strategies that changes the way a firm competes. • Improved performance in comparison of market competitors using chosen criteria (e.g. market share, industry dominance, industry ranking, etc.).

  16. Value Addition by IS (imp) Enhance Product characteristics & product delivery Facilitates Business Process in Operations management & Strategic Planning PRODUCT PROCESS Increasing Process Quality & Product Quality though improvement & innovation QUALITY

  17. ESS TPS ES DSS WGS MS Information System Application Information System Application Communication DATA H/W S/W Organization Structure Information Mgmt Human Resources System Customer Regulatory Agencies Supplies Competition Information System environment

  18. Management Information Differ by Level in the Organization Proportion of Information Types Needed Comfort Information Status Information Warning Information Planning Information Internal Operation Information External Intelligence Externally Distributed Information Top Management & Executives Factual Details Exception Reports Financial Accounting Information Management Accounting Information Internally Oriented Information Operating & Lower Level Managers

  19. Common Type of MIS Output • Printed Output • Visual Output • Graphic Output • Secondary Storage Output • Microfilm Output • Audio Response Output • Plotter Output

  20. Problems in Development of MIS • Major Problems • Lack of Top Mgmt involvement in planning and Design phase. • Cost & Complexity of using a Database Management System. • Inadequate pre-system planning. • Recruiting qualified computer specialists. • Inadequate strategy for extending MIS to other part of the company.

  21. Problems in Development of MIS • Moderate Problems • Cost of proposed computed application outweigh their economic benefit. • Integrating the computer with the rest of the company. • Availability of computer programs and operating systems. • Employee resistance towards the MIS • Planning what job to automate; availability of instructional material • Proposed computer application are too time consuming to automate • Management resistance towards MIS

  22. Problems in Development of MIS • Minor Problems • Management acceptance of the computer • Role of System Analysts/Designers not clearly defined. • Reliability of computers and related equipment. • Management of computer and related equipment.

  23. Guidelines for overcoming problems (try to give opposite statemnts of benefts) • Ensure that MIS is truly modified to meet user objectives, not just self serving interest of MIS staff. • MIS staff should insist on the meaningful involvement by management and corporate management as well. • Ensure that the user involvement in agreed upon before any work on MIS takes place. • Ensure that user both understands and accepts full responsibility & commitment towards the ultimate success of the MIS project.

  24. Guidelines for overcoming problems • Ensure that user involvement is active and not passive, and maintained throughout the development of MIS • Ensure that schedules are realistic and accurately reflect not only the MIS staff ability, but also that of the user to participate in the development of MIS • Ensure that MIS staff understands the importance of observing commitments & maintaining quality.

  25. Guidelines for overcoming problems • Ensure that user management is constantly informed about the MIS projects, that the communication channels are kept open at all the times. • Involve Top Management from an overall standpoint in the planning phase as well as succeeding phases of the MIS project. • Provide adequate pre-system planning that focuses on getting started on MIS project • Get appropriate functional managers & their personnel involved in the detailed aspects of the MIS project

  26. Consideration of IS in Strategic Planning Information Systems Capabilities, Applications, Personnel, Hardware, Software, Data, Communication Used to implement Strategic Plans: Considered after plans are formulated No consideration of Strategic Impact: IS & Plans are separate Considered in formulation of Strategic Plans: Considered before formulation of plan is completed.

  27. IS for Corporate Strategy • Determination of strategies by corporate executives • Need of Information System in identified • IS plan is formulated to assist in implementing the Organization Strategy.

  28. IS for Corporate Strategy: Areas • The industry in which the firm now competes • New Product or Service • Improved Production economies • Improved Delivery capabilities • New Markets the firm can enter • Geographic expansion of market • Expansion into new market segments • Industries in which the firm can begin competing • Offer services & products in industry to which firm has been supplier • Create new industry • The elements with which firm interacts or that influence it • Customers, Suppliers, Regulators, Competitors

  29. Integrated Information System • System that has module for each functional subsystem of the enterprise & implement all the management activities within each module.

  30. Integrated IS framework Subsystem Software Modules DBMS Model Base Applica -tion Software Strategic Planning Management Control Operation Control Transaction Control Private Data Private Data Private Data DBMS

  31. Major Modules of a Information System Project • Feasibility Study Determines the appropriateness of making a system change • Introductory investigation • Structured analysis • Structures System Design • Equipment Selection

  32. Major Modules of a Information System Project … • System Implementation: Provides the user with a fully operational system • Training of Personnel • Structured Programming & Compiling • Structured Walkthroughs & Testing • Parallel Operations for checking the new system • Final Conversion to new system • Periodic Review: Ensures that the system continues to meet users needs effectively.

  33. Characteristics of a well designed MIS • Acceptability • Relates to approval of MIS by personnel who will use it. • To improve acceptability user should participate in the development of MIS. • Design Making ability • Refers to the capability of MIS to produce timely, pertinent information, facilitating the decision making process of organization personnel, at the lowest cost. • Economy • Centers on keeping costs low by capturing control information in the MIS as near to the source as possible.

  34. Characteristics of a well designed MIS • Flexibility • Focuses on the capability of MIS to adopt to changing environmental conditions likewise, organization personnel must be prepared to adjust their operations to changing conditions. • Reliability • Refers to the consistency of MIS to control operations. • A high degree of reliability can be designed into the system by incorporating good control. • Simplicity • Stresses the capability of the MIS to provide a straight-line flow from one operation to the next, thereby avoiding needless backtracking and duplication.

  35. The System Life Cycle • Inception • Preliminary Survey • Feasibility Study • Existing Procedures Alternative System estimates • System Analysis • Details of present procedures

  36. The System Life Cycle • Requirement Analysis • User Needs – Collection of Data on volumes, input/outputs, files, boundary settings • Design • Ideal System unconstrained revision to make ideal acceptable • Specifications • Processing logic, File Design, Input/Output, Programming requirement, Manual Procedures

  37. The System Life Cycle • Programming & Testing • Unit Tests, Combined Module Tests, Acceptance Tests • Training, Conversion & Installation Operation • Maintenance & Enhancements

  38. Tools for a S/w Project • Data Collection Tools: • Observation • Interviews • Questionnaires • Comparisons • Seminars • Presentations

  39. References • Information Systems for Modern Management – 3ed • Robert G Murdic, Joel E Ross, James R Colggett – PHI • Management Information System • Gerald V Post, David L Anderson – TMH • Management Information System • Mc-Lead • Management Information System • Kroonke – Macmillan Publishing • Management Information System • Senn • Analysis & design of Information System • Senn • Software Engineering – 3ed • Pressman

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