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management information system


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management information system

  1. 1. Foundation of information systems ; Evolution of MIS: Concepts; framework for understanding and designing MIS in an organization; Concept of information; definition, features, types, process of generation and communication; quality and value of information; information overload; techniques for managing overload; summarizing; filtering ;inferences and message routing. System concept; definition, types and characteristics of system-control in systems : feedback: positive and negative; negative feedback control system, input, process and output control; law of requisite variety.
  2. 2.  Its an organized combination of people, h/w, s/w, communication networks and data resources that collects, transforms & disseminate information in an organization.  An information system and MIS (IS) - or application landscape - is any combination of information technology and people's activities that support operations, management and decision making.
  3. 3.  Components of IS  People  H/W  S/W  N/W  Data
  4. 4.  ISs can be categorized in four parts: ―Management Information System (MIS) ―Decision Support System (DSS) ―Executive Information System (EIS) ―Transaction Processing System (TPS)
  5. 5. Roles of IS Support Strategies for CompetitiveAdvantage Support Business Decision Making Support Business Processes and Operations
  6. 6. MIS Management Information System
  7. 7.  It describes What managers do in the operation of their organization: Plan, organize, initiate and control operations  They plan by setting strategies and goals and selecting the best course of action to achieve the plan.  They organize the tasks necessary for the operational plan.  They Control the performance of work by setting performance standards and avoiding deviations from standard.  The most important task of managers is decision making.
  8. 8. Information consists of data that have been retrieved , processed or otherwise used for informative or inference purposes of decision making. Information improves the quality of decision making.
  9. 9. •A group of interrelated or interacting elements forming a unified whole, •A group of interrelated components working together toward a common goal by accepting inputs and producing outputs in an organized transformation process (dynamic system).  A system can be described simply as a set of elements joined together for a common objective.  Systems can be viewed as process models in terms of their inputs, outputs, processing, and feedback/control mechanisms. •Three basic interacting components: – Input – Processing (transformation process) – Output
  10. 10. • System:A set of components that work together to achieve a common goal • Subsystem:One part of a system where the products of more than one system are combined to reach an ultimate goal Two types of Systems:  Closed system: Stand-alone system that has no contact with other systems  Open system: System that interfaces with other systems
  11. 11.  A management information system (MIS) provides information that organizations need to manage themselves efficiently and effectively.  The MIS is defined as a system which provides information support for decision making in the organization.  The MIS is defined as a system based on the database of the organization evolved for the purpose of providing information to the people in the organization.  The MIS is defined as a Computer based Information System.
  12. 12. Management Information Systems (MIS)(Contd…) • 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
  13. 13. Schematic
  14. 14. Corporate databases of internal data Databases of external data Databases of valid transactions Operational databases Transaction processing systems Management information systems Decision support systems Executive support systems Expert systems Business transactions Input and error list Drill-down reports Exception reports Demand reports Key-indicator reports Scheduled reports Employees Corporate intranet Application databases
  15. 15.  The MIS is an idea which is associated with man, machine, marketing and methods for collecting information’s from the internal and external source and processing this information for the purpose of facilitating the process of decision-making of the business.
  16. 16. Management oriented. Management directed. Integrated Common data Flows Strategic Planning Bias towards centralization Information and communication technology enabled.
  17. 17. Management oriented. Management directed. Integrated Common data Flows Strategic Planning Bias towards centralization Information and communication technology enabled. Top down design. Focus is to satisfy the information needs of the management
  18. 18. Management oriented. Management directed. Integrated Common data Flows Strategic Planning Bias towards centralization Information and communication technology enabled. Management is involved in the design process ,continuous review and up gradation of MIS in order to develop a good quality system. The system is structured. Minimizes the gap between expectation of the management and the actual system
  19. 19. Management oriented. Management directed. Integrated Common data Flows Strategic Planning Bias towards centralization Information and communication technology enabled. Integrated with all the operations and functional activities of the management. Only an integrated system can provide the complete picture of the scenario.
  20. 20. Management oriented. Management directed. Integrated Common data Flows Strategic Planning Bias towards centralization Information and communication technology enabled. Data being stored into the system, retrieved from the system, disseminated within the system or processed by the system can be handled in an integrated manner. Avoids data duplication, data redundancy, and help simplify operations.
  21. 21. Management oriented. Management directed. Integrated Common data Flows Strategic Planning Bias towards centralization Information and communication technology enabled. A high degree of planning goes into creating an MIS.
  22. 22. Management oriented. Management directed. Integrated Common data Flows Strategic Planning Bias towards centralization Information and communication technology enabled. Centralized data management helps an MIS to exercise version control as well as provide an integrated view of data to the managers.
  23. 23. Management oriented. Management directed. Integrated Common data Flows Strategic Planning Bias towards centralization Information and communication technology enabled. Information should be timely and accurate for effective decision making
  24. 24. 27 MIS Functions: The broad functions of MIS are •To improve decision making. •To improve efficiency. •To provide connectivity. The main functions of MIS are Data Processing Prediction Planning Control Assistance
  25. 25.  The main scope of MIS corresponds to different phases such as analysis, design, planning and construction.  These also include many other activities such as implementation, utilization , evaluation and handling of information systems for coordinating various activities in the organization.  The MIS helps in strategic planning, management control, operational control and transaction processing.  The MIS plays the role of information generation, communication, problem identification and helps in the process of decision-making.
  26. 26. Outputs of a Management Information System • Scheduled reports • Produced periodically, or on a schedule (daily, weekly, monthly) • Key-indicator report • Summarizes the previous day’s critical activities • Typically available at the beginning of each day • Demand report • Gives certain information at a manager’s request • Exception report • Automatically produced when a situation is unusual or requires management action
  27. 27. 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
  28. 28. Organization and Management Technique of Management Function of Management 1. Behavioral ScienceTechnique 2. QuantitativeTechnique 3. DecisionTechnique 4. Experience Rule Planning Organization Directing Staffing Controlling Man Power Resource Flows Money, Material M/c Facilities MIS Structure of MIS
  29. 29. MIS structure be described by following a variety of different approaches:  Physical components,  Information system processing functions,  Decision support  Levels of management activities  Organizational functions
  30. 30. Structure of MIS may be understood by looking at the physical components of the information system in an organization.  Hardware: Hardware refers the physical data processing equipment and peripheral devices.  Software: software is broad term given to the instruction or program that direct the operation of the hardware.  Database: the data base consist of all data utilized by application software.  Input and output: various physical input and output from the information system, existing in the form like printout, report etc.
  31. 31. Information system structure can also be understood in term of its processing functions.The main processing functions of information system are described below:  To ProcessTransactions: Information systems process transaction may be defined as an activity taking place in an organization.  To Maintain Master files: Information systems create and maintain master files in the organization. A master file stores the historical data about the organization.  To Produce Reports: Reports are significant products of an information system. Many reports are produces on a regular basis, which are called scheduled reports.  To Process Interactive Support Applications
  32. 32. Decision vary with respect to the structure that can be provided for making them. A highly structured decision can be pre-planned. A structured decision, because of its well defined nature can be said to be programmable.
  33. 33.  The structure of an information system can be categorized in terms of level of the management activities.  Strategic planning deals with long-range considerations. The decisions include the choice of business directions, market strategy, product etc.  Management control level includes acquisition and organization of resource, structuring of work and training of personnel.  Operational control is related to short-term decision for current operations. Pricing, ,inventory level etc
  34. 34.  The structure of management information system can also be described in terms of the organizational functions.
  35. 35.  Information, in its most restricted technical sense, is a sequence of symbols that can be interpreted as a message.  Information can be recorded as signs, or transmitted as signals.  The information has a value in decision making while data does not have.  Information brings clarity and creates an intelligent human response in the mind.  information is the message (utterance or expression) being conveyed.
  36. 36. The first business application of computers (in the mid- 1950s) performed repetitive, high-volume, transaction-computing tasks. The computers” crunched numbers” summarizing and organizing transactions and data in the accounting, finance, and human resources areas. Such systems are generally called transaction processing systems (TPSs)
  37. 37.  Data that is (1) accurate and timely, (2) specific and organized for a purpose, (3) presented within a context that gives it meaning and relevance, and (4) can lead to an increase in understanding and decrease in un certainty.  Information is valuable because it can affect behavior, a decision, or an outcome.
  38. 38. „ Management Information Systems (MISs): these systems access, organize, summarize and display information for supporting routine decision making in the functional areas. „ Office Automation Systems( OASs): such as word processing systems were developed to support office and clerical workers. Decision Support Systems: were developed to provide computer based support for complex, nonroutine decision. „ End- user computing: The use or development of information systems by the principal users of the systems’ outputs, such as analysts, managers, and other professionals.
  39. 39.  Improves representation of an entity  Updates the level of knowledge  Has a surprise value  Reduces uncertainty  Aids in decision making
  40. 40. 1. Primary (Think of this as Firsthand) Primary information is comprised of original materials that were created first hand.This type of information is from the time period involved and has not been filtered through interpretation. Examples are:  Diaries  Interviews (legal proceedings, personal, telephone, email)  Letters  Original Documents (i.e. birth certificate or a trial transcript)  Patents  Photographs  Proceedings of Meetings, Conferences and Symposia.  Survey Research (such as market surveys and public opinion polls)  Works of Literature
  41. 41. 2. Secondary (Think of this as Second Hand) Secondary information is made up of accounts written after the fact with the benefit of hindsight. It is comprised of interpretations and evaluations of primary information. Secondary information is not evidence, but rather commentary on and discussion of evidence. Examples are:  Biographies  Books  Commentaries  Dissertations  Indexes, Abstracts, Bibliographies (used to locate primary & secondary sources)  JournalArticles
  42. 42. 3. Tertiary (Think of this asThird Hand) Tertiary information is a distillation and collection of primary and secondary information. Examples are:  Almanacs  Encyclopedias  Fact books
  43. 43.  The decision making process includes the following stages:  Identification and structuring of problem: One needs information to identify a problem and put it in a structured manner.  Putting the problem in a context: Without information about the context in which the problem has occurred, one cannot take any decision on it. In a way , the context defines the problem.
  44. 44.  Generation of alternatives: Information is a key ingredient in the generation of alternatives for decision-making.  Choice of the best alternative: Based on the information about he suitability of the alternatives, a choice is made to select the best alternative.
  45. 45.  Data Repository: This is a subsystem which is at the core of any information system. These structures are arranged in a way that helps in faster storage and retrieval of data with adequate security.  User Interface: This subsystem handles the interaction of the system with the user and hence it has to manage issues related to the display of data on an output medium.
  46. 46.  Network:This subsystem ensures communication between the different entities of an information system.  Computer Hardware:An IT infrastructure is needed in an effective manner.  System Software : Some basic software is required for the efficient functioning of information system.  Input/Output: I/O must be user independent.
  47. 47.  Business rule(process) : This is a set rules which governs how a system should function to imitate the real business process.  Algorithm/program/ application software: This is the actual invisible component, which integrates all the components.The logic is defined in the program.
  48. 48. Data processing can be defined as the processing of data to make it more usable and meaningful and thus converting into information. It covers all activities required for generating information from data.
  49. 49. 1. Origination: 2. Input: 3. Processing: 4. Storing: 5. Data retrieval: 6. Production of documents: 7. Data communication:
  50. 50. 1. Origination: 2. Input: 3. Processing: 4. Storing: 5. Data retrieval: 6. Production of documents: 7. Data communication: The main source of records used in data processing is sales orders, purchase orders or employee time cards stored in magnetic tapes, disks and terminals.
  51. 51. 1. Origination: 2. Input: 3. Processing: 4. Storing: 5. Data retrieval: 6. Production of documents: 7. Data communication: The input of data stored on these source documents into the data processing system.The data records stored in secondary devices is now fed into the computer for processing.
  52. 52. 1. Origination: 2. Input: 3. Processing: 4. Storing: 5. Data retrieval: 6. Production of documents: 7. Data communication: Computer and other electronic devices are used for processing data. Data should be sorted and verified before processing. Processing involves calculation, comparison, filtering and modification of data according to user’s requirements.
  53. 53. 1. Origination: 2. Input: 3. Processing: 4. Storing: 5. Data retrieval: 6. Production of documents: 7. Data communication: The result of processing of data must be kept for future reference. This function is called storage.
  54. 54. 1. Origination: 2. Input: 3. Processing: 4. Storing: 5. Data retrieval: 6. Production of documents: 7. Data communication: With the introduction of information technology users will be able to search and retrieve files records on-line with direct access devices.
  55. 55. 1. Origination: 2. Input: 3. Processing: 4. Storing: 5. Data retrieval: 6. Production of documents: 7. Data communication: Copies of documents and reports are prepared as an output of the information system.
  56. 56. 1. Origination: 2. Input: 3. Processing: 4. Storing: 5. Data retrieval: 6. Production of documents: 7. Data communication: On-line transmission of information is possible in electronic data processing system.
  57. 57.  The quality and value of information can be described as how it contributes for effective decision making.  The quality of information is high, if it creates managerial impact leading to attention, decision and action.
  58. 58. Value of Information:  Timeliness  Presentation  Accuracy  Context  Expectation
  59. 59. The quality of information can be measured on the four dimensions: utility, satisfaction, error, bias.
  60. 60. 1)The utility Dimension:-  The utility dimension has four components namely the form, the time, the access and the procession.  If the information is presented in the form of manager requires, then its utility increases.  If it is available(time) when needed, the utility is optimized.  If the information is easily and quickly accessible through the online access system, its utility gets an additional boost.  If the information is processed by the manager who needs it, then its utility is the highest.
  61. 61. 2)Satisfaction Dimension:-  The degree of satisfaction would determine the quality of the information.  If the organization has a high degree of satisfaction, then one can be safe in saying that information systems are designed properly to meet the information needs of the managers at all the levels.
  62. 62. 3)Error Dimension:-  The error creep in on account of various reasons, namely:  An incorrect data measurement  An incorrect collection method.  Failure to follow the prescribed data processing procedure.  Loss of data or incomplete data.  Poor application of data validation and control systems.  A deliberate falsification.  The data should be avoided of errors, care should be taken that the information is processed after ensuring the correctness of the data in terms of time and the number of document, and the transactions in the period.
  63. 63. 4. Bias Dimension:-  The procedure of communicating the information should be such that the system is able to detect the degree and the nature of the bias and correct the information accordingly.
  64. 64.  It is a situation where a manager is given too much information and as a result his is confused and cannot make optimal decisions.
  65. 65.  Refers to the difficulty a person can have understanding an issue and making decisions that can be caused by the presence of too much information.  Information overload occurs when the amount of input to a system exceeds its processing capacity.  information overload is simply the inability for a person or entity to digest and apply all of the information provided to them.
  66. 66.  Stress induced by reception of more information than is necessary to make a decision and by attempts to deal with it outdated time management practices.  information overload is a phenomenon of having so much information that the very volume creates the additional work of having to decide what is important, rather than helping executives to solve problems and make decisions.  Information overload is a fact of life for company directors, senior managers, and all professionals.
  67. 67.  Increasing globalization  Diversification of business forces
  68. 68.  A rapidly increasing rate of new information.  The ease of duplication and transmission of data across the Internet  An increase in the available channels of incoming information (e.g. telephone, e-mail, instant messaging)  Large amounts of historical information to dig through  Contradictions and inaccuracies in available information  A low signal-to-noise ratio  A lack of a method for comparing and processing different kinds of information  The pieces of information are unrelated or do not have any overall structure to reveal their relationships
  69. 69. 1. Focus and specialize in one thing 2. Take Control 3. Follow only valuable sources 4. Unsubscribe from most of the unwanted subscription 5. Organize the time…
  70. 70. The main important techniques are:- 1. Data summarizing 2. Message modification or filtering 3. Inferences 4. Message routing
  71. 71. SYSTEM CONCEPTS……..
  72. 72.  A system is a group of interrelated components, with a clearly defined boundary, working toward the attainment of a common goal by accepting inputs and producing outputs in an organized transformation process.  Derived from Greek word 'Systema'.  Means an organised relationship among functional units or components.
  73. 73.  A system is an orderly grouping of interdependent components linked together according to a plan to achieve a specific objective. It can be defined as a set of interacting entities with interrelationships/interconnections amongst each other forming an integrated whole.
  74. 74.  A set of components that interact to accomplish goals.  Systems can be viewed as process models in terms of their inputs, outputs, processing, and feedback/control mechanisms. System Examples:  University – an example  Inputs: students, faculty, textbooks  Processing mechanisms: teaching, research, service  Output: graduates  Goal: acquisition of knowledge
  75. 75. SYSTEM Processing Input Output
  76. 76.  Input  Processing  Output
  77. 77.  Have a specific structure  Are a model of reality  Has a purpose  Have inputs and outputs.  Will have measures of performance  Has an environment
  78. 78. 1. Closed and Open system 2. Deterministic, Probabilistic and Random systems 3. Human, Machine and Human-machine system 4. Abstract and Concrete Systems 5. Adaptive and Non-adaptive systems 6. Simple and Complex Systems
  79. 79.  The mechanism of feedback has a very simple definition: "the return to the input of a part of the output"  It is data about the performance of a system.  The information measuring the goals and providing control to the system.  feedback generally as "information about the gap between the actual level and the reference level of a system parameter which is used to alter the gap in some way",.  It provides a perfect regulatory mechanism.
  80. 80.  Positive feedback  Negative feedback
  81. 81.  positive feedback is defined as a positive loop gain around a feedback loop.  positive feedback is in phase with the input, in the sense that it adds to make the input larger.  Positive feedback tends to cause system instability.  positive feedback is also known as regenerative feedback.
  82. 82.  Negative feedback is also known as degenerative feedback.  Feedback that reduces the output of a system.  Negative feedback tends to make a system self-regulating; it can produce stability and reduce the effect of fluctuations.
  83. 83.  Negative feedback control is system means keeping the system operating within certain limit of performance.
  84. 84. Input Process Output Storage Feedback
  85. 85.  Law of requisite variety is one of the basic notation of system control theory, to obtain control.  This has various rigorous formulations, but a commonsense, understanding is that to control each possible state of system elements.
  86. 86.  This means also that the control for the system must be able to determine of variables and send system change instructions for each change.The Law of requisite variety needs that for a system to be control, every controller (human/machine) must be provided with enough control responses (what to do in each case) to cover all possible condition the system may face.
  87. 87.  The law of requisite variety means that for a system to be controlled, every controller(human and machine) must be provided with:- 1. Enough control responses (what to do in each case) to cover all possible conditions the system may face. 2.The decision rules for generating all possible control responses OR 3.The authority to become a self organizing system in order to generate control responses.  Enumerating all responses is possible in simple cases. In complex systems providing control responses is very difficult.
  88. 88. End of 1st module…… References: 1. Introduction to information systems- O’Brien 2. MIS- O’Brien, Marakas, Behl (ninth edition) 3. Mis- Mcgraw hill Publication 4. MIS- Nirmalya Bagchi 5. Websites……
  89. 89.  Date: