Weeks 4-5: Internal Information Systems

1. Weeks 4-5: Internal Information Systems MIS 2101: Management Information Systems Based on material from Information Systems Today: Managing in the Digital World, Leonard Jessup and Joseph Valacich, Pearson Prentice Hall, 2007 Also includes material by David Schuff, Paul Weinberg, and Cindy Joy Marselis.

2. Learning Objectives

3. Learning Objectives

4. Decision-Making Levels of an Organization

5. Operational Level Day-to-day business processes Interactions with customers Information systems used to: Automate repetitive tasks Improve efficiency Decisions: Structured Recurring Can often be automated using IS Examples?

6. Managerial Level Functional managers Monitoring and controlling operational-level activities Providing information to executive level Midlevel managers Focus on effectively utilizing and deploying resources Goal of achieving strategic objectives Managers’ decisions Semi-structured Contained within business function Moderately complex Time horizon of few days to few months Examples?

7. Executive Level The president, CEO, vice presidents, board of directors Decisions Long-term strategic issues Complex and nonroutine problems Unstructured decisions Long-term ramifications Examples? 7-7

8. Comparison of Decision-Making Levels

9. Learning Objectives

10. General Types of Information Systems Input-process-output model Basic systems model Payroll system example

11. Transaction Processing System Operational level Purpose: Processing of business events and transactions Increase efficiency Automation Lower costs Increased speed and accuracy Examples Payroll processing Sales and order processing Inventory management Etc.

12. Architecture of a TPS

13. Architecture of a TPS: Inputs Source Documents Different data entry methods

14. Architecture of a TPS: Processing Online processing Immediate results Batch processing Transactions collected and later processed together Used when immediate notification not necessary

15. Architecture of a TPS: Outputs Counts, summary reports Inputs to other systems Feedback to systems operator

16. Summary of TPS Characteristics

17. Management Information Systems Managerial level Purpose: Produce reports Support of midlevel managers’ decisions Examples Sales forecasting Financial management and forecasting Manufacturing, planning and scheduling Inventory management and planning Etc.

18. Architecture of an MIS

19. Architecture of an MIS: Processing Aggregation Summary

20. Architecture of an MIS: Outputs

21. Summary of MIS Characteristics

22. Executive Information Systems A.k.a. Executive support system Executive level Purpose Aid in executive decision-making Provide information in highly aggregated form Examples Monitoring of internal and external events and resources Crisis management Etc.

23. Architecture of an EIS

24. Architecture of an EIS: Inputs Hard data Facts and numbers Generated by TPS & MIS Purchased data Soft data Nonanalytical information Web-based news portals Customizable Delivery to different media

25. Architecture of an EIS: Processing Summarizing Graphical interpreting

26. Architecture of an EIS: Outputs Summary reports Trends Simulations

27. EIS Output: Digital Dashboards Digital dashboard Presentation of summary information Information from multiple sources Ability to drill down if necessary

28. Summary of EIS Characteristics

29. Summary So what’s the trend as you go down the list/up the pyramid? • Executive Information Systems • Highest level summary of information • Management Information Systems • Aggregate and collect data • Transaction Processing Systems • Collect data

30. Summary: Types of Information Systems Weaker EIS MIS TPS Controls and Security Stronger Operations Staff Transaction Processing Source: Business Driven Technology, by Haag, Baltzan, Phillips, McGraw Hill, 2006 (with modifications)

31. Summary: Decision Levels Decision Level Description Example Type of Information Executive Competitive advantage Market leader Long term New products that change the industry External events, rivals, sales, costs quality, trends. Management Improve operations without restructuring New tools to cut costs or imp- rove efficiency Expenses, schedules, sales models, forecast Operations Day-to-day actions keep company running Scheduling employees, placing orders. Transactions, accounting, HRM, inventory

32. Learning Objectives Information Systems Today: Managing in the Digital World 7-32

33. Seven Information Systems that Span Organizational Boundaries

34. 1. Decision Support Systems Decision making support for recurring problems Used mostly by managerial level employees (can be used at any level) Interactive decision aid What-if analyses Analyze results for hypothetical changes

35. Architecture of a DSS

36. Common DSS Models Information Systems Today: Managing in the Digital World 7-36

37. Using DSS to Buy a Car Selling price – $22,500 Down payment – $2,500 Monthly payment – about $400 Interest rate information from the bank

38. 2. Intelligent Systems Artificial intelligence Simulation of human intelligence Reasoning, learning, sensing, hearing, walking, talking, etc.

39. Intelligent Systems Three types Expert systems Neural networks Intelligent agents

40. Expert Systems Use reasoning methods Manipulate knowledge rather than information System asks series of questions Inferencing/pattern matching Matching user responses with predefined rules If-then format

41. Neural Network System Approximation of human brain functioning Training to establish common patterns Past information New data compared to patterns E.g., loan processing

42. Example: Neural Network System Loan processing system relying on a neural network -42

43. Intelligent Agent Systems Program working in the background Bot (software robot) Provides service when a specific event occurs

44. Intelligent Agent Types Buyer agents (shopping bots) – search for best price User agents – perform a task for the user Monitoring and sensing agents – keep track of key information Data-mining agents – analyze large amounts of data Web crawlers (web spiders) – browse the Web for specific information Destructive agents – malicious agents designed by spammers

45. 3. Data Mining and Visualization Systems Application of sophisticated statistical techniques What-if analyses to support decision making Capabilities can be embedded into a large range of systems

46. Visualization Display of complex data relationships using graphical methods Visualization of a weather system

47. Text Mining Extraction of information from textual documents Web crawlers used to extract information from Internet

48. 4. Office Automation Systems Developing documents, scheduling resources, communicating Examples Word processing Desktop publishing Electronic calendars E-mail

49. 5. Collaboration Technologies Increased need for flexible teams Virtual teams – dynamic task forces Forming and disbanding as needed Fluctuating team size Easy, flexible access to other team members Need for new collaboration technologies

50. Video Conferencing Costs – few thousand dollars to $500,000 Dedicated videoconferencing systems Located within organizational conference rooms Highly realistic