intro -

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• INTRO -1

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MIS

• Management Information System

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MANAGEMENT

• Management in all business and human organization
  activity is simply the act of getting people
  together to accomplish desired goals and
  objectives.
• Management comprises  planning, organizing, 
  staffing,  leading or directing,
  and controlling an organization (a group of one
  or more people or entities) or effort for the
  purpose of accomplishing a goal.
• Resourcing encompasses the deployment and
  manipulation of human-resources, financial resourc
  es, technological resources, and natural
  resources.

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MANAGEMENT

• Frenchman Henri Fayol considers management to
  consist of seven functions
• planning
• organizing
• leading
• coordinating
• controlling
• staffing
• motivating

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Information

• As a concept has a diversity of meanings, from
  everyday usage to technical settings. Generally
  speaking, the concept of information is closely
  related to notions of constraint,communication, co
  ntrol, data, form, instruction, knowledge, meaning
  , mental stimulus, pattern,perception,
  and representation.

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System

• System (from Latin systema, in turn from Greek )
  is a set of interacting or interdependent entities
  , real or abstract, forming an integrated whole.

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MIS

• Management Information
• Management information system helps middle level
  management planning, controlling and decision
  making.
• The data stored can be used or manipulated to
  produce differently defined reports from
  pre-defined reports.
• It can be presented graphically or pictorically

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DEFINITION

• An 'MIS' is a planned system of the collecting,
  processing, storing and disseminating data in the
  form of information needed to carry out the
  functions of management. In a way it is a
  documented report of the activities those were
  planned and executed.

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DEFINITION

• According to Philip Kotler 
• "A marketing information system consists of
  people, equipment, and procedures to gather,
  sort, analyze, evaluate, and distribute needed,
  timely, and accurate information to marketing
  decision makers

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OVERVIEW

• At the start, in businesses and other
  organizations, internal reporting was made
  manually and only periodically, as a by-product
  of theaccounting system and with some
  additional statistics, and gave limited and
  delayed information on management performance.

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OVERVIEW

• the term "MIS" arose to describe these kinds of
  applications. Today, the term is used broadly in
  a number of contexts and includes (but is not
  limited to) decision support systems, resource
  and people management applications,project
  management and database retrieval application.

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OVERVIEW

• In their infancy, business computers were used
  for the practical business of computing
  the payroll and keeping track of accounts
  payableand accounts receivable. As applications
  were developed that provided managers with
  information about sales, inventories, and other
  data that would help in managing the enterprise,

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MIS IS ???

• The terms MIS and information system are often
  confused.
• Information systems include systems that are not
  intended for decision making.
• MIS is sometimes referred to, in a restrictive
  sense, as information technology management. That
  area of study should not be confused
  with computer science. IT service management is a
  practitioner-focused discipline.
• MIS has also some differences with Enterprise
  Resource Planning (ERP) as ERP incorporates
  elements that are not necessarily focused on
  decision support.

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Various Advantages of Information Management
Systems

• 1. It Facilitates planning MIS improves the
  quality of plants by providing relevant
  information for sound decision making . Due to
  increase in the size and complexity of
  organizations, managers have lost personal
  contact with the scene of operations.
• 2. In Minimizes information overload MIS change
  the larger amount of data in to summarized form
  and there by avoids the confusion which may arise
  when managers are flooded with detailed facts.

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Various Advantages of Information Management
Systems

• 3. MIS Encourages Decentralization
  Decentralization of authority is possibly when
  there is a system for monitoring operations at
  lower levels. MIS is successfully used for
  measuring performance and making necessary change
  in the organizational plans and procedures
• 4. It brings Co ordination MIS facilities
  integration of specialized activities by keeping
  each department aware of the problem and
  requirements of other departments. It connects
  all decision centers in the organization .

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Various Advantages of Information Management
Systems

• 5. It makes control easier MIS serves as a link
  between managerial planning and control. It
  improves the ability of management to evaluate
  and improve performance . The used computers has
  increased the data processing and storage
  capabilities and reduced the cost .
• 6. MIS assembles, process , stores , Retrieves ,
  evaluates and Disseminates the information

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• INTRO -2

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Management Information Systems

• By Sarfraz Haider

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Data Versus Information

• In everyday language data and information are
  used interchangeably. 
• For example, the Oxford American Dictionary
  defines data as
• "facts or information to be used as a basis of
  discussing or deciding something." 
• At the same time information is defined as
• "facts told or discovered or facts to be fed to a
  computer".  
• In both definition, data and information are
  assumed to be one and same concept.

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• Data are collection of observations, which may or
  may not be true.  Thus data may not be facts. 
  Data become information when they are processed. 
  To process data one needs to
• (1) clean the data from errors and reduce sources
  of unreliability,
• (2) analyze data to make it relevant to decision
  at hand, and
• (3) organize data in ways that help
  understanding. 

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Role of Informationin Organizations

• Organizations collect and distribute
  information. In the process, they also distort
  it.  Some distortions are intentional.
• Sometimes employees are asked to summarize data
  and report it to their supervisors.  By
  definition, summarizing data means leaving some
  parts of it out. This is one type of distortion
  that is intentional. 
• Other times, organizations distort data so much
  as to changes its meaning and value.  This
  section describes the importance of information
  within organization and how information is
  acquired and changed within organizations.

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In this definition, information is "meaningful
data."  Data are the building blocks and
information is the finished house.  The raw
materials are useless as a pile but once
organized into a structure they become someone's
home.   Likewise data are useless for managers
unless organized into information.
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Organization

• Basically, an organization is a group of people
  intentionally organized to accomplish an overall,
  common goal or set of goals. Business
  organizations can range in size from two people
  to tens of thousands.

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Organization as a System

• It helps to think of organizations as systems.
  Simply put, a system is an organized collection
  of parts that are highly integrated in order to
  accomplish an overall goal. The system has
  various inputs which are processed to produce
  certain outputs, that together, accomplish the
  overall goal desired by the organization.

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Organization as a System

• There is ongoing feedback among these various
  parts to ensure they remain aligned to accomplish
  the overall goal of the organization. There are
  several classes of systems, ranging from very
  simple frameworks all the way to social systems,
  which are the most complex. Organizations are, of
  course, social systems.

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Organization as a System

• Systems have inputs, processes, outputs and
  outcomes. To explain, inputs to the system
  include resources such as raw materials, money,
  technologies and people. These inputs go through
  a process where they're aligned, moved along and
  carefully coordinated, ultimately to achieve the
  goals set for the system. Outputs are tangible
  results produced by processes in the system, such
  as products or services for consumers.

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Management again

• Management is the process of
• leading,
• controlling,
• planning,
• and organizing.
• The most important thing managers do is make
  quick, accurate, and decisive decisions. The
  manager is important because he/she is the leader
  of the organization that leads people to get
  things done.

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Organization and information

• The issue of information requirements of an
  organization and their specifications span two
  isolated territories. One territory is that of
  organization and management and the other belongs
  to technicians. There is a considerable gap
  between these two territories. Research in
  requirements engineering (technician's side) has
  primarily concentrated on designing and
  developing formal languages to document and
  analyze user requirements, once they have been
  determined.

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Organizational Structure

• Organizational structure is the formal system of
  task and reporting relationships that controls,
  coordinates, and motivates employees so they
  cooperate and work together to achieve
  organizational goals.
• Organizations are
• Social entities
• Goal oriented
• Deliberately structured
• Linked to the external environment

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Components of an Organization

• The environment influences organizational design.
  When uncertainty exists, the ability to respond
  quickly and creatively is important when the
  environment is stable, an organization improves
  performance by making attitudes and behaviors
  predictable. Creativity and predictability are
  fostered by certain structures and cultures.
• Task - an organizations mission, purpose, or
  goal for existing
• People - the human resources of the organization

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Components of an Organization

• Structure - the manner in which an organizations
  work is designed at the micro level how
  departments, divisions, the overall
  organization are designed at the macro level
• Technology - the intellectual and mechanical
  processes used by an organization to transform
  inputs into products or services that meet

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Information System

• Information System (IS) refers to a system of
  people, data records and activities that process
  the data and information in an organization, and
  it includes the organization's manual and
  automated processes. In a narrow sense, the term
  information system (or computer-based information
  system) refers to the specific application
  software that is used to store data records in a
  computer system and automates some of the
  information-processing activities of the
  organization.

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Levels of decision Making

• Strategic Management
• ?? Set long-term objectives, allocate resources
• ?? Tactical Management
• ?? Monitor performance, make adjustments
• ?? Operational
• ?? How to carry out specific day-to-day tasks

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Types of Decisions

• ?? Structured
• ?? A routine decision whose factors are known
• ?? Semi- structured
• ?? A risky decision in which one or more factors
  is
• unknown
• ?? Unstructured
• ?? A unique decision for which the relevant
  factors are
• unknown entails uncertainty and requires judgment

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6 Major Information Sys Types

• by Support Provided
• ?? Transaction Processing Systems (TPS)
• ?? Office (Automation) Systems (OAS)
• ?? Knowledge (Work) Systems (KWS)
• ?? Management Information Systems (MIS)
• ?? Decision Support Systems (DSS)
• ?? Executive Support Systems (ESS)

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IS Types
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Management Information Systems (MIS)

• ?? Mainly support tactical management level
• ?? Deals with structured/semi-structured
  decisions
• ?? Generally reporting and control oriented
• ?? Little analytical capability
• ?? Input data stored in DB by TPS
• ?? Processing simple models
• ?? Output summary and exception reports
• ?? Example inventory control systems, sales
  performance analysis,
• pricing systems
• TPS KWS OAS MIS DSS EIS

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Types of System
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Computer Based Information Sys

• Computer-based information system) refers to the
  specific application software that is used to
  store data records in a computer system and
  automates some of the information-processing
  activities of the organization. Computer-based
  information systems are in the field of
  information technology.

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• a technologically implemented medium for
  recording, storing, and disseminating linguistic
  expressions, as well as for drawing conclusions
  from such expressions

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Decision Making

• Decision Making
• ?? Decision making involves choosing between two
  or more alternatives
• - Remember that not making a decision is a
  decision
• - It has four major elements

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Decision Making

• - Problem definition clearly there are more
  issues, questions, and problems than individuals
  or society has the time or resources to confront.
  
• - Problems are plentiful attention is scarce.
• - In order for problems to get attention they
  have to first get on the policy agenda
• - As the problem emerges and gains attention, it
  also tends to gain focus and take shape
• - See problem definition notes below.

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Decision Making

• - Information search The definition between
  problem definition and information is never
  sharp. When we are vaguely aware of some problem,
  our first step is often to learn more about it.
  This learning process often gives the problem
  focus.
• - Time is often a big factor in information
  search. When time is short we often satisfice
  rather than optimize (see discussion on bounded
  rationality below).

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Decision Making

• - Choice Weighing options and selecting among
  alternatives are often the visible part of
  decision-making processes.
• - However, choices are rarely clear and when
  clear alternatives are know, the consequences of
  these actions is often poorly understood.
• - Similarly, our preferences are rarely clear or
  constant when viewed over time.

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Decision Making

• - Evaluation Decisions do not end with a choice
  among alternatives. Few choices are final and
  most are continually reconsidered in light of new
  information.
• - Even if choices are not repeated, current
  choices become precedents for future decision

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Decision Making

• - Most difficult aspect of evaluating choices is
  to establish criteria for evaluation and to not
  fall victim to common decision-making problems
  like cognitive bolstering (discussed below) where
  you search for information to justify rather than
  scrutinize past decisions.

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Constraints on decision making

• - Upper Limits of a Decision Limitations on how
  far a decisionmaker can go
• - Lower Limits of a Decision Minimum that must
  occur for problem to be solved
• - Strategic Limiting Factors Factor whose
  availability in the right form, at the right
  place and time will establish a new system of
  conditions

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• Individual differences individuals have
  different decision-making styles
• - Different ways of thinking (e.g., some are
  logical, some process information serially, some
  are intuitive or creative, some view
  interconnections better than others, etc.)
• - Some are more tolerant of ambiguity

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• Combination of these two factors creates four
  styles
• - Directive style have low tolerance for
  ambiguity and seek rationality
• - Analytical types accept ambiguity and seek
  rationality
• - Conceptual style tend to be intuitive and
  accept ambiguity
• - Behavioral styles work well with others, are
  intuitive and have a low tolerance for ambiguity

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Organizational constraints

• - Managers are strongly influenced by the
  criteria that they will be evaluated on
• - Reward systems influences decision-makers by
  suggesting to them what choices are preferable in
  terms of a personal payoff
• - Organizations often impose time constraints
• - Organizations often give preference to
  historical precedents and decisions are often
  made in the context of a stream of decisions

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• Decisionmakers tend to rely on heuristics,
• (serving to indicate, Pattern ) judgmental
  shortcuts, when making decisions
• - Availability heuristic the tendency for people
  to base their judgments on information that is
  readily available to them
• - Representative heuristic Decision-makers tend
  to assess the likelihood of an occurrence by
  trying to match it with a preexisting category
• - Escalation of commitment is an increased
  commitment to a pervious decision in spite of
  negative information
• ??

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Improving Creativity

• - Direct instruction ask people to be creative.
  It works because people tend to accept obvious
  solutions and this often prevents people from
  exploring creative solutions
• - Attribute listing list attributes of
  alternatives and examine them fully to generate
  new alternatives or eliminate them
• - Lateral thinking instead of thinking beginning
  to end, other avenues are explored perhaps
  starting with the solution and working towards
  the beginning

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Cultural differences

• - People from different cultures often make
  decisions in different ways by giving different
  importance to rationality, their belief in the
  ability of people to solve problems, and emphasis
  on solving problems

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• INTRO-3

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Chapter 9
Management Information Systems
62
Management Information Systems (MIS)

• Management information system (MIS)
• An MIS provides managers with information and
  support for effective decision making, and
  provides feedback on daily operations
• Output, or reports, are usually generated through
  accumulation of transaction processing data
• Each MIS is an integrated collection of
  subsystems, which are typically organized along
  functional lines within an organization

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Sources of Management Information
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Employees
Corporate databases ofinternaldata
Databasesofexternaldata
Corporateintranet
Decisionsupportsystems
Databasesofvalidtransactions
Application databases
Transactionprocessingsystems
Managementinformationsystems
Executivesupportsystems
Businesstransactions
Operationaldatabases
Expertsystems
Drill-down reports
Exception reports
Demand reports
Key-indicator reports
Input anderror list
Scheduledreports
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Outputs of a Management Information System

• Scheduled reports
• Produced periodically, or on a schedule (daily,
  weekly, monthly)
• Key-indicator report
• Summarizes the previous days critical activities
• Typically available at the beginning of each day
• Demand report
• Gives certain information at a managers request
• Exception report
• Automatically produced when a situation is
  unusual or requires management action

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Scheduled Report Example
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Key Indicator Report Example
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Demand Report Example
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Exception Report Example
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Outputs of a Management Information System
Drill Down Reports Provide detailed data about a
situation.
Etc. See Figure 9.2
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Characteristics of a Management Information System

• Provides reports with fixed and standard formats
• Hard-copy and soft-copy reports
• Uses internal data stored in the computer system
• End users can develop custom reports
• Requires formal requests from users

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Management Information Systems for Competitive
Advantage

• Provides support to managers as they work to
  achieve corporate goals
• Enables managers to compare results to
  established company goals and identify problem
  areas and opportunities for improvement

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MIS and Web Technology

• Data may be made available from management
  information systems on a companys intranet
• Employees can use browsers and their PC to gain
  access to the data

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Functional Aspects

• MIS is an integrated collection of functional
  information systems, each supporting particular
  functional areas.

Schematic
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Internet
An OrganizationsMIS
FinancialMIS
Businesstransactions
Databasesofvalidtransactions
Drill down reports
AccountingMIS
Transactionprocessingsystems
Exception reports
Demand reports
Key-indicator reports
MarketingMIS
Scheduled reports
Businesstransactions
Databasesofexternaldata
HumanResourcesMIS
Etc.
Extranet
Etc.
Figure 9.3
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Financial MIS

• Provides financial information to all financial
  managers within an organization.

Schematic
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Databases ofexternal data
Databases ofinternal data
FinancialDSS
Businesstransactions
Databasesof validtransactionsfor eachTPS
Financialapplicationsdatabases
Transactionprocessingsystems
FinancialMIS
Businesstransactions
Operationaldatabases
Financial statements
FinancialES
Uses and managementof funds
Internet orExtranet
Financial statisticsfor control
Businesstransactions
Customers,Suppliers
Figure 9.3
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Inputs to the Financial Information System

• Strategic plan or corporate policies
• Contains major financial objectives and often
  projects financial needs.
• Transaction processing system (TPS)
• Important financial information collected from
  almost every TPS - payroll, inventory control,
  order processing, accounts payable, accounts
  receivable, general ledger.
• External sources
• Annual reports and financial statements of
  competitors and general news items.

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Financial MIS Subsystems and Outputs

• Financial subsystems
• Profit/loss and cost systems
• Auditing
• Internal auditing
• External auditing
• Uses and management of funds

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Manufacturing MIS
Schematic
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Databases ofexternal data
Databases ofinternal data
ManufacturingDSS
Businesstransactions
Databasesof validtransactionsfor eachTPS
Manufacturingapplicationsdatabases
Transactionprocessingsystems
ManufacturingMIS
Businesstransactions
Quality control reports
Operational databases
ManufacturingES
Process control reports
JIT reports
Internet orExtranet
MRP reports
Production schedule
CAD output
Businesstransactions
Customers,Suppliers
Figure 9.6
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Inputs to the Manufacturing MIS

• Strategic plan or corporate policies.
• The TPS
• Order processing
• Inventory data
• Receiving and inspecting data
• Personnel data
• Production process
• External sources

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Manufacturing MIS Subsystems and Outputs

• Design and engineering
• Master production scheduling
• Inventory control
• Manufacturing resource planning
• Just-in-time inventory and manufacturing
• Process control
• Computer-integrated manufacturing (CIM)
• Quality control and testing

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Marketing MIS

• Supports managerial activities in product
  development, distribution, pricing decisions, and
  promotional effectiveness

Schematic
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Databases ofexternal data
Databases ofinternal data
ManufacturingDSS
Databasesof validtransactionsfor eachTPS
Marketingapplicationsdatabases
Transactionprocessingsystems
MarketingMIS
Businesstransactions
Sales by customer
Operational databases
ManufacturingES
Sales by salesperson
Sales by product
Pricing report
Total service calls
Customer satisfaction
Figure 9.9
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Inputs to Marketing MIS

• Strategic plan and corporate policies
• The TPS
• External sources
• The competition
• The market

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Marketing MIS Subsystems and Outputs

• Marketing research
• Product development
• Promotion and advertising
• Product pricing

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Human Resource MIS

• Concerned with all of the activities related to
  employees and potential employees of the
  organization

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Databases ofexternal data
Databases ofinternal data
ManufacturingDSS
Databasesof validtransactionsfor eachTPS
Humanresourceapplicationsdatabases
Transactionprocessingsystems
HumanResourceMIS
Businesstransactions
Benefit reports
Operational databases
ManufacturingES
Salary surveys
Scheduling reports
Training test scores
Job applicant profiles
Needs and planningreports
Figure 9.12
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Inputs to the Human Resource MIS

• Strategic plan or corporate policies
• The TPS
• Payroll data
• Order processing data
• Personnel data
• External sources

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Human Resource MIS Subsystems and Outputs

• Human resource planning
• Personnel selection and recruiting
• Training and skills inventory
• Scheduling and job placement
• Wage and salary administration

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Other MISs

• Accounting MISs
• Provides aggregated information on accounts
  payable, accounts receivable, payroll, and other
  applications.
• Geographic information systems (GISs)
• Enables managers to pair pre-drawn maps or map
  outlines with tabular data to describe aspects of
  a particular geographic region.

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End of Chapter 9
Chapter 10