Mis & Decision Making


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Mis & Decision Making

  1. 1. MIS & Decision Making<br />By ArunMishra<br />
  2. 2. DECISION MAKING<br />Decision making is the developing concepts leading to the selection of a course of action among variations. Every decision making process produces a final choice<br />It can be an action or an opinion. It begins when we need to do something but we do not know what<br />e.g. Decision to raise a Purchase Order<br />
  3. 3. Decision making in business and management<br />In general, business and management systems should be set up to allow decision making at the lowest possible level.<br />Several decision making models or practices for business include:<br />SWOT Analysis - Evaluation by the decision making individual or organization of Strengths, Weaknesses, Opportunities and Threats with respect to desired end state or objective.<br />Buyer decision processes - transaction before, during, and after a purchase<br />Corporate finance:<br />The investment decision<br />The financing decision<br />The dividend decision<br />working capital management decisions<br />Cost-benefit analysis - process of weighing the total expected costs vs. the total expected benefits<br />
  4. 4. Types of Decisions<br />Unstructured/ Nonprogrammed<br />Structured/ Programmed<br />Semi-structured<br />
  5. 5. Information Requirements of Key Decision-Making Groups in a Firm<br />
  6. 6. The Decision-Making Process<br />Phases of Decision Making Process<br /><ul><li>Intelligence
  7. 7. Design
  8. 8. Choice
  9. 9. Implementation</li></li></ul><li>Stages in Decision Making<br />
  10. 10. Phases of Decision Making Process<br />Intelligence gathering<br />Definition of problem<br />Data gathered on scope<br />Constraints identified<br />Design phase<br />Alternatives identified and assessed<br />Choice<br />Selection of an alternative<br />Implementation<br />Testing the selected alternative.<br />
  11. 11. Typical Inputs and Outputs<br />Inputs: Information from the TPS<br />Outputs: hard and softcopy reports<br />Scheduled reports<br />On-demand reports<br />Key-indicator (business fundamentals)<br />Exception reports<br />
  12. 12. MIS Support to Decision Making Process<br />
  13. 13. Functional Perspectives of MIS<br />Financial MIS<br />Will integrate information from multiple sources<br />Functions<br />Costing<br />P&L reporting<br />Auditing<br />Funds management<br />
  14. 14. Functional Perspectives of MIS<br />Manufacturing<br />Design and Engineering<br />Master Production Scheduling<br />Inventory Control<br />Materials Planning<br />Manufacturing and Process Control<br />Quality Control<br />
  15. 15. Functional Perspectives of MIS<br />Marketing<br />Market research<br />Web-based market research<br />Pricing<br />
  16. 16. Functional Perspectives of MIS<br />Transportation and Logistics<br />Route and schedule optimization<br />Human Resources<br />Accounting<br />
  17. 17. Systems for Supporting Decisions<br /><ul><li>Management information systems (MIS)
  18. 18. Decision-support systems (DSS)
  19. 19. Executive support systems (ESS)
  20. 20. Group-decision support systems (GDSS)
  21. 21. Intelligent techniques</li></li></ul><li>Management Information Systems (MIS)<br /><ul><li>Help managers monitor and control a business
  22. 22. Produce regular reports on performance, such as monthly or annual sales
  23. 23. Sometimes highlight exceptional conditions
  24. 24. Reports often available online</li></li></ul><li>Decision Support Systems (DSS)<br /><ul><li>Support semi-structured and unstructured problem analysis
  25. 25. Characteristics</li></ul>Data from multiple sources internal and external to organization<br />Presentation flexibility<br />Simulation and what-if capability<br />Support for multiple decision approaches<br />Statistical analysis<br />
  26. 26. Components of DSS<br /><ul><li>DSS database
  27. 27. DSS software system
  28. 28. Models
  29. 29. Sensitivity analysis
  30. 30. DSS user interface</li></ul>Examples of DSS<br /><ul><li>DSS for pricing decisions in FMCG & Pharma Companies.
  31. 31. DSS for customer relationship management in Banks</li></li></ul><li>Group Decision-Support Systems (GDSS)<br />Very interesting field<br />How can information technology improve how decisions are made by groups?<br />Interactive, computer-based systems that facilitates solving of unstructured problems by a set of decision makers<br />Used in conference rooms with special hardware and software<br />Support increased meeting sizes with increased productivity<br />
  32. 32. Group Decision-Support Systems (GDSS)<br />Applications<br />Where time is critical<br />Where participants are geographically dispersed<br />Where authority obstructs communication<br />Military<br />Business<br />Government<br />
  33. 33. Group Decision-Support Systems (GDSS)<br />Common characteristics<br />Meeting moderation/facilitation<br />Signed and anonymous comments<br />Structured deliberations<br />Presentation period<br />Comment period<br />Automated collation of comments<br />“Voting”<br />Face-to-face and remote<br />
  34. 34. Executive Information Systems<br />What information does a chief executive of board member require?<br />High level with drill down<br />Key business and industry data<br />Structured and unstructured information<br />Structured: orders<br />Unstructured: Industry newsfeed<br />Graphical<br />
  35. 35. Executive Information Systems<br /><ul><li>Give senior executives a picture of the overall performance of an organization
  36. 36. Enable an executive to zoom in on details or zoom out for a broader view
  37. 37. Drill down capability
  38. 38. Digital dashboard</li></li></ul><li>Intelligent Systems for Decision Support<br /><ul><li>Artificial intelligence (AI)
  39. 39. Expert systems
  40. 40. Case-based reasoning
  41. 41. Intelligent agents</li></li></ul><li>Intelligent Agents in P&G’s Supply Chain Network<br />Intelligent agents are helping Procter & Gamble shorten the replenishment cycles for products, such as a box of Tide.<br />