MANAGEMENT INFORMATION SYSTEMDATA: data is raw facts and figures typically about both physical phenomena orbusiness transactions. More specifically data are objective measurement ofattributes (characteristics) of entities (such as people, place, things and events).INFORMATION: Processed data is information. Thus we can define information asdata that have been converted into a meaningful and useful context for specific endusers.Difference between Data and Information: DATA INFORMATION Data is generally disorganised and Information is properly arranged, disintegrated in the form classified and organised. Data is in raw form Information is in finished form Data can not be understood or made Information can be understood or made use of by the users used by the users Data does not depends upon Information is based upon and derived information from the data.
DATA PROCESS INFORMATION DECISION SPECIFIC IMPLEMENTATION ACTION
CLASSIFICATION OF INFORMATION SYSTEM INFORMATION SYSTEM OPERATION MANAGEMENT SUPPORT SUPPORT SYSTEM SYSTEMT.P.S. P.C.S. E.C.S. M.I.S. D.S.S. E.I.S.
T.P.S.- Transaction Process SystemP.C.S.- Process Control SystemE.C.S.- Enterprise Collaboration SystemM.I.S.- Management Information SystemD.S.S.- Decision Support SystemE.I.S.- Executive Information System
Operation Support SystemThe information system which supports day to day operations at the lower level management such as cash management, credit management, billing, invoice, selling, purchasing, inventory management, salary and wage records, etc.TPS (Transaction Processing System)Transaction is a process where 2 or more parties are involved in order to exchange of 1 commodity for exchange of other. There are 2 types of processing:a) Batch Processingb) Real Time Processing Batch Processing Real Time Processing Processing does not happen then and there but Processing happens then and there. after a stipulated period of time It is slow process It is fast process Provides obsolete and old information Provides most updated information Cost effective/less costly because load is Costly because good and advance quality of divided into batches processor is required to support the load Less possibility of errors eg. Depositing a More prone to errors eg. When we get cash bill cheque in a bank manually after purchasing items.
P.C.S. (Process Control System)System regulating any kind of process. PCS consists of that broad categoryof information system in which any kind of production process which isphysical, chemical, biological, bio-chemical, production process related todrugs, automobiles etc. In any of these process, production is controlled withhelp of information system.E.C.S. (Enterprise Collaboration System)ECS is that category of information system which helps in collaboration andcoordination among the various stakeholders of business using the internetplatform such as intranet and extranet, where in the basic idea is to formulatea cross functional, multi disciplinary team in order to share assets, resourcesand take GD on virtual basis overcoming the barriers related to time, cost,infrastructural and distance.Some ECS: mobile conferencing, video conferencing, audioconferencing, WAP, electronic meeting system, GD, e-mail, voice mail,extranet, e-mail, voice mail, FTP
MANAGEMENT SUPPORT SYSTEMIt supports critical decision taking at top level, middle level and top levelmanagement. MSS is more specialized system.D.S.S. (Decision Support System)Decision means selecting the best alternative among different availablealternatives. Intelligence Phase Identifying Problem Design Phase Develop Alternatives Choice Phase Selection of Best Alternative Herbert Simon approach to Decision MakingProblem can be faced at any stage of an organisation. In this phase in order tounderstand the problem you are required to apply your brain, intelligence,various statistical data, logical ability etc., designing various alternative whichcan be developed for a single problem
MANAGEMENT INFORMATION SYSTEMProvide information in the form of prescribed reports and displays tosupport business decision making. Eg. Sales analysis, productionperformance, and cost trend reporting system.EXECUTIVE INFORMATION SYSTEMProvide critical information from many sources tailored tothe information needs of executives. Eg. Systems for easyaccess to analyses business performance, action ofcompetitors and economic developments to supportstrategic planning.
PROCESS OF GENERATING INFORMATION Process of generating information begins with process of datacollection. There are several methods of data collection. The choice of methodhas an impact on the quality of information. Some of the methods of datacollections are discussed as under:ObservationIt is a first hand knowledge by a person who is responsible for collecting data.Example: Visit to the customer for assessing the customer complaints. A visit toassess the accidental damage for insurance payment purpose. The mainadvantage of first hand knowledge is less response bias. An accuracy ofobservation will decide the response.ExperimentationConducting an experiment can collect the information on a specific parameter.For example: conducting a control experiment can assess the impact of a newfertilizer dose on the yield of a crop. Conducting a test market trial can assessthe impact of a new packaging of a product. The quality of information will be afunction of design of experiment.
Survey Under this method a part (sample) of population is covered on specificaspects for the purpose of information collection, However, the quality of theinformation depends on the instruments such as questionnaire used forcollecting the information, Examples of Survey are market surveys, opinionpolls, census etc.Subjective Estimation In the absence of experiment, surveys, and first hand information,expert opinion may be called to collect the information. The information may becollected from more than one expert and in more than one round of collectionfrom the same expert. The multiple set of information/data can beanalyzed/processed to get the right information with minimum bias. Datapertaining to future like alternate source of energy, the life style and food habitsof later half of 21st century are collected using subjective estimations. Theseestimates are called subjective since no probability law is being used forcollecting the information.
Transaction ProcessingSources of data for this method are ledgers, payrolls, stock statements andsales reports of an organization. The data collected from these sources willrequire the processing to get meaningful information.PublicationsIn this method, data are collected from secondary sources. The sources arepublication of financial institutions, industrial organization, universities,consulting firms etc. This method of data collection is less costly.Government AgenciesSome of the state agencies in all countries publish reports about the basicparameters of the economy and other facets of the society. For example:Publications of Central Bank of a country, in case of India publications such asRBI Annual Report, Report on Currency and Finance, Economic survey etc.falls in this category. These reports are available to researchers, planners andpolicy makers. In addition, these reports are also available to public. However,this information may not be directly useful but one can make use of thisinformation. In fact all activities in an organization generate data.
Strategic Roles of Information SystemA company has competitive advantage over other companies when it sustains marketability and greater market share. The area of specialisation is above any other company in the industry. i.e. you are ahead your competitors.Who are you competitors?1. Me tools2. Substitutes3. New entrantsMe tools: These are identical products from different companies. i.e. the have similar types product, similar technology and similar target area. Eg. Refrigerators from samsung and LGSubstitutes: replacement of products i.e. tea and coffeeNew Entrants: who are now coming up with new product of the same category. i.e. LG producing electronics now entering in to FMCG
If any firm can overcome 5 forces of business the firm is able to achieve competitiveadvantage in the marketMichael Porter’s 5 forces Model THREATS FROM ME TOOLS & SUBSTITUTE THREATS INTERNAL FROM RIVALRY AMONG NEW ENTRANTS FIRM’S FIRMS COMPETITIVE ADVANTAGE BARGAINING POWER BARGAINING POWER OF SUPPLIERS OF CUSTOMERSBargaining power of customer is due to high supply and low demand. Customer becomechoosy.Bargaining power of supplier is due to high demand and low supply. Eg. Maggi
STRATEGIES TO ACHIEVE COMPETITIVE ADVANTAGES1. Cost Leadership2. Innovation: New offer and never before3. Differentiation: Unique product and features4. Diversification Related Diversification- Johnson & Johnson Non Related Diversification-ITC5. Strategic Alliances: Alliance means ASSOCIATION Mergers: A& B – AB company Acquisition/Takeover: A buys B Joint Ventures: A&B for project. Will separate after project completes Technology Collaboration: Technical Know how is provided by one company to another
ARTIFICIAL INTELLIGENCEArtificial Intelligence is that branch of science which deals with computer in which thegoal is to develop computer which can think, see, hear, talk and feel or in other wordsdeveloped computer which can perform functions equivalent to human intelligence.Artificial Intelligence is multi disciplinary because it has borrowed its principles from: • Mathematics • Operation research • Statistics • Psychology • Engineering Application areas of Artificial Intelligence Artificial Intelligence Cognitive Science Natural Interface Robotics Applications Applications Applications
Cognitive Sciences ApplicationsSomething related to cognition i.e. mental ability to solve a problem usingreasoning, learning ability.Cognitive Science. This area of artificial intelligence is based on research in biology,neurology, psychology, mathematics, and many allied disciplines. It focuses onresearching how the human brain works and how humans think and learn. The resultsof such research in human information processing are the basis for the developmentof a variety of computer-based applications in artificial intelligence.Applications in the cognitive science area of AI include the development of expertsystems and other knowledge-based systems that add a knowledge base and somereasoning capability to information systems. Also included are adaptive learningsystems that can modify their behaviors based on information they acquire as theyoperate. Chess-playing systems are primitive examples of such applications, thoughmany more applications are being implemented. Fuzzy logic systems can process datathat are incomplete or ambiguous, that is, fuzzy data. Thus, they can solveunstructured problems with incomplete knowledge by developing approximateinferences and answers, as humans do. Neural network software can learn byprocessing sample problems and their solutions. As neural nets start to recognizepatterns, they can begin to program themselves to solve such problems on their own.Genetic algorithm software uses Darwinian (survival of the fittest), randomizing, andother mathematics functions to simulate evolutionary processes that can generateincreasingly better solutions to problems. And intelligent agents use expert systemand other AI technologies to serve as software surrogates for a variety of end userapplications.
ROBOTICS:Al, engineering, and physiology are the basic disciplines of robotics. This technologyproduces robot machines with computer intelligence and computer- controlled,humanlike physical capabilities. This area thus includes applications designed to giverobots the powers of sight, or visual perception; touch, or tactile capabilities; or skill inhandling and manipulation; locomotion, or the physical ability to move over any terrain;and navigation, or the intelligence to properly find one’s way to a destination.NATURAL INTERFACES:The development of natural interfaces is considered as a major area of Al applicationsand is essential to the natural use of computers by humans. For example, thedevelopment of natural languages and speech recognition are major thrusts of this areaof AI. Being able to talk to computers and robots in conversational human languagesand have them “understand” us as easily as we understand each other is a goal of AIresearch. This involves research and development in linguistics, psychology, computerscience, and other disciplines. Other natural interface research applications include thedevelopment of multisensory devices that use a variety of body movements to operatecomputers. This is related to the emerging application area of virtual reality. Virtualreality involves using multisensory human- computer interfaces that enable human usersto experience computer-simulated objects, spaces, activities, and “worlds” as if theyactually exist.
Expert System An expert system is a computer based application thatguides the performance of ill-structured tasks which usuallyrequires experience and expertise. Using an expert system,a non-expert can achieve performance comparable to anexpert in that particular domain. Expert systems can beconsidered as an instance of a DSS. The unique feature ofan expert system is the knowledge base, the data anddecision rules which represent the expertise. The concept of expert systems is based on theassumption that an expert’s knowledge can be captured incomputer storage and then applied by others when the needarises.
Components of Expert SystemUser Interface: the user interface allows the user to enter instructionsand information to the expert system and receive information from theexpert system.Knowledge Base: the knowledge base contains the facts that describethe problem area, and knowledge representation techniques thatdescribe how the facts fit together in a logical manner.Inference Engine: the interface engine of an expert system takes therules that defines how the expert processes his factual knowledge andinterprets them as appropriate. Unlike a simple program, the steps arenot sequentially determined by the programmer, but follow from thedata input and the results obtained at earlier stages in the user systemDevelopment Engine: the development engine is used to create theexpert system. The process essentially involves building the rule set.There are two basic approaches: programming languages and expertsystem shells.
System• A System is a set of individual components linked together achieve a common goal.• A group of interrelated components working together towards a common goal by accepting input thereby producing output in an organised transformation process.• A combination of a group of interrelate or interacting elements that form a unified whole.
System Stakeholders System stakeholder means any person who has an interest in an existing or proposed information system. Stakeholders may include technical and non- technical workers as well as internal and external workers.1. System Owners: Any Information System can have one or more owners. Usually, system owners are the managers of the organisation. Hence, they view an information in terms of cost and benefits to solve problems and exploit opportunities.
2. System Analyst: System analyst is a specialist who studies the problems and needs of an organisation to determine how people, data, process and information technology can best accomplish improvements for the business. The system analyst is a unique stakeholder because he serves as a facilitator, bridges the communication gaps that can naturally developed between the technical system designer and builder and non technical owners and users.3. System Designers: A technical experts is someone who translates system users, business requirements and constraints into a technical solutions. A system designer can be a database administrator, network architect, web architect, graphics artists, security experts and technology specialists.
4. System Builders: System builder is a technical specialist who constructs information system and components based on the design specifications generated by the system designers.5. System Users: System user is a person who will use or is affected by an information system on a regular basis. They are the person who are involved in capturing, validating, entering and exchanging data and information. There are broadly two categories of system users:a) Internal System Users: Internal system users are clerical and service workers, technical and professional staff, supervisors, middle managers and top managers.b) External System Users: They are also known as remote user (a user who is located at a distant place but needs the information). Example of external user are customers, suppliers, partners, employees etc.
SDLC (System Development Life Cycle)SDLC describe the various stages throughwhich software goes during itsdevelopment. Each SDLC stage consistshave well Defined activities and methodsto perform their job.
Phases of SDLC:1. Problem Identification: The objective of problem identification phase is to understand the problem. This necessitates the need for preliminary investigation.2. Preliminary Investigation: The main objective of preliminary investigation is to determine whether the request is valid and feasible.
3. Feasibility Study: Feasibility study involves seeing whether it is possible (feasible) to do the change in the system or build a new one, as per the outcome of preliminary investigation. Types of Feasibility study: Economical Feasibility: Study to see that whether it will be economically feasible to go ahead with the system development. If the benefits outweigh costs, then the decision is made to design and implement the new system. Technical Feasibility: It involves studying the system for checking that whether it will be technically feasible to develop and implement the system. Behavioral or Operational Feasibility: The study is done to see that weather the users staff, do will actually be the user of the system, and accept the new system. It is very important that the users are covered to use the new system.
4. System Analysis: System analysis is process of studying existing system and its environment. Interviews, outside observation and questionnaires are different tools used for analysis of the system.5. System Design: System Design consists of design activities that produce system specification satisfying the functional requirements that were developed in the system analysis process. Cost and benefit analysis is also done during this phase.
System DesignUser Interface Data Process Design Design Design• Screen, Form, Data Element Program and Report, and Structure Procedure Dialog Design Design Design
6. Coding: Coding the system involves writingprograms, the design made during the design periodare converted into actual programs.7. Testing: Testing the system involves checking all themodules developed, during the coding phase for theirproper functionality. Testing involves checking thesystem for the result by comparing the result with theintended output.Testing is the quality- control measure of softwaredevelopment. Testing detects errors in all the phases ofsoftware development, discovering requirements,design and coding errors in software.
There are two types of testing techniques: Black Box Testing: Detects errors in the functional behavior of a program. White Box Testing: Detects errors in the internal structure of a program.8. Implementation: Implementation phase of SDLC involves implementation of the system developed at the user site. Implementation involves user training, site preparation and file conversion.
9. Maintenance: When the implementation or installation phase is completed and user staff is adjusted then the system evaluation and maintenance of hardware and software. There are three types of software maintenance: – Corrective Maintenance: Corrective maintenance is concerned with the removal of errors discovered after delivery of software to the customer. For example, when the library management system was delivered, the customer found that the software was not displaying the names of all students who checked out books. – Adaptive Maintenance: Adaptive Maintenance is concerned with changes in the software due to a change in the environment in which the software functions. For example, a banking system showing message starting that the memory is full, after the 1,000th entry. Perfective Maintenance: Perfective Maintenance implements new functional system requirements generated by the customer. For example, after testing the banking system, the customer realizes that the system should also show the details of daily transactions being carried out.