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Decision Making and Information SystemsAriful Saimon
Premier University
[B.B.A]
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Subject : Decision Making and Information
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[B.B.A]
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Semester: 5th Section: “A” Batch :22nd
Group Name: D’5
E-mail : Saimonchy20@gmail.com
A set of interrelated elements or components that collect (input), manipulate (process), and disseminate (output) data and information and provide a feedback mechanism to meet an objective.
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Management 2.0
1. Summary
Web 2.0 provides a revolutionary opportunity to create a system for managing business performance in
the form of a neural network of people and information, self-aware, self-monitoring, and self-correcting.
This submission describes principles currently used for organizational management versus the wonderful
opportunity for a highly advanced management system available in "Management 2.0." We believe the
appropriate management control system for the future is what we call "Advanced Management Insight"
(AMI). We believe it will be a means to transcend and bring alive a complete framework for managing a
business. The AMI architecture and real-world implementations have been proceeding for the past five
years. We believe it is not only a revolutionary concept, but also a practical and easy-to-implement
approach.
Problem
Human capital is a critical asset to all businesses, and the problems associated with capturing it and
leveraging it are well known. One of the primary problems all managers have is implementing newly
gained knowledge and putting best practices into action. Whatever management information system is
used for Management 2.0, it must be simple to implement, as simple as setting up a spreadsheet or
checklist. This narrative describes the ideal management system for any business, the constraints that
keep us from implementing it today, and some of the potential critical success factors.
GOALS AND OBJECTIVES OF AN IDEAL MANAGEMENT SYSTEM
The management information and control system of a business governs collection and flow of information
and also acts to set standards of governance, control, and visibility of business data. It is meant to
ensure the proper flow and use of information upward to various management levels. It is also meant to
serve the purpose of being a conduit of downward-and-across goals, objectives, standards, best
practices, and governance and communications.
Top executives understand that the design and execution of the management system is one of the few
ways in which they can effectively direct the energy of their business. The goals and objectives of the
ideal management system, and the underlying requirements for our vision of “advanced management
insight,” include the following:
•Provide critical information flow throughout the organization to enable visibility, control and governance
•Provide true and insightful information to management by including human feedback of stakeholders
•Provide properly distilled key information to all levels of management to:
•Understand what is occurring in their business, providing visibility into operations and into results
•Allow upper management to use their knowledge and judgment to evaluate operations
•Allow upper management to advise and consult with lower and peer management
•Provide risk assessment and governance facts and warnings
•Make available a common data platform for all management use
•Provide a common language of facts and rules by which the company is managed and governed.
•Drive a fact-based culture and reduce anecdotal and story-telling management practices
•Build a historical repository of business operational data and facts, and a consistent audit trail
•Allow for the spreading of knowledge and best practices
2. In summary, the management control system is the “prescribed information system used by management
to ensure the clean and honest flow of information,” one that provides for efficient management
interaction within the organization.
CLASSIC MANAGEMENT MODEL
In the classic model, information flow is often a collection of individually prescribed networks created by
whoever the current managers are and their view of their own needs, which often changes. It is directly
related to the immediate focus of the individual management unit.
Human feedback data is seldom considered part of the information flow and is seldom formally solicited or
required. Human opinion/perspective from the participating stakeholders is typically provided by word of
mouth in meetings, the hallway, or at the coffee pot. It is seldom in the record, or in individual written
reports. The end result is that the left hand often can’t know what the right hand is doing. At the
operational level, individual islands of information and knowledge exist within a segment of the
organization, and the collective knowledge of the lowest-level workers is never captured, much less
leveraged.
Moreover, as personnel change, the information
desired and the upward flow change. History is
often lost, i.e., the meaning of the empirical data. The
objectives, data flow, etc., run the risk of disruption
and change with every significant change of
manager, executive, or subject matter expert.
Judgment and analysis within the information flow
is then highly impeded by new or less capable
managers. Top management seldom has a
comprehensive information flow within the organization.
Instead of a constantly improving information flow,
they face a constant change and lack of overall
design.
All organizations have a constantly changing mix of
individuals of various capabilities, experience,
and talent. Knowledge drain is a fact of life, particularly in the social world of Web 2.0. Not everyone can
be an “A” player, but the classic model fails to maximize the knowledge of the “A” players and to lift up,
monitor, and systemically improve the B, C, and D players.
CONSTRAINTS OF MANAGEMENT 1.0
Multiple constraints impede the successful execution of current management systems, including all of the
following.
•Information tends to often flow only vertically in a silo-like fashion.
•Two forms of data exist: operational (empirical) data, and feedback data (verbal perspective, opinion,
judgment, etc.). Both are important.
•Classically, there is no formal record maintained of the feedback data.
•There are many human data filters where individuals chose to decide which information flows upward,
goes into the record, is changed, emphasized or filtered.
•True management review and governance is extremely time-consuming or difficult, and in most cases is
done with incomplete and filtered information.
•Smooth information flow and easy reuse of data is limited or non-existent.
3. •Information, facts, risk, etc., can be hidden, either intentionally or unintentionally.
•Bad news is often filtered for too long by individuals before being communicated to management.
•There can be little formal checking and quality assurance (QA) of data and information as the data flows
within the organization
•Formal records or repositories of information sometimes exist but they are most often islands of data that
tend to serve operational objectives well and to serve management visibility, governance, etc., poorly.
Determining a true history is difficult.
•These systems are hard to modify. As the business grows and adapts to a changing world, the
management control system itself is unable to adapt. Whatever change is possible requires computer
programmers, many of whom do not understand the business. And the implementation cycle is months
and sometimes years, by which time the business has moved in another direction.
Solution
Advanced Management Insight is a revolutionary framework for the design, build, control, and operation
of a business’s management data and human reporting. It provides a business knowledge and quality
assurance management control system. Its primary purposes are to (1) programmatically define the
gathering and flow of information in one or all business units and (2) allow for seamless knowledge
dissemination into and within the business. All of this is done by easily designing and networking
individual “control rooms” into a comprehensive network, a business intelligence and reporting system.
As an integrated repository of human knowledge within an enterprise, AMI provides a bold new frame of
reference for effective management. We see it as a means to drive knowledge across the enterprise and
retool management to perform more effectively in a 2.0 world. We also foresee challenges and
tremendous potential for managing a transparent "democracy of information."
4. MANAGEMENT 2.0 MODEL: ADVANCED MANAGEMENT INSIGHT
As noted, the 2.0 community is a neural network. It has a
repository of knowledge, is aware of its mission, and is a
growing and learning entity that will broadcast “critical insights”
to stakeholders and provide unfiltered access to information.
Its lowest unit of self-management is what we call a cell.
All business organizations are made up of collections of
management units, i.e., a group or groups of people overseen
by a manager. In most businesses, this will be a department,
work group, or other similar business unit. As with any
organization chart, the cell can also contain underlying cells,
such as a division made up of underlying departments or a
department made up of underlying teams.
Cells have their own rules of engagement, focused on how to
accomplish their work. The information that the cell uses to
manage itself contains both hard data, such as key
performance indicators (KPIs) and other numerical data; and
soft data, such as opinions, perspectives, and similar human
knowledge about the business and the work at hand.
The challenge for Management 2.0 is to
create a common, easy-to-modify
system that will synthesize rules,
procedures, data, and information from
the business environment and from the
people impacted by it. In AMI terms, we
envision a control unit that manages this
flow of hard and soft information. AMI is
designed to automate and institutionalize
both the objective (empirical) and
subjective (human) knowledge needed
to manage a business. It enables a
business to intermingle this hard and soft
data. In point of fact, the 2.0 business
must have this enhanced view of its
operations in order to remain
competitive.
This allows us to leverage knowledge, shown as “K” in the diagram. This allows AMI to know what data
to collect, who to collect it from, and who to notify in exception conditions. This includes incorporating
perceptive information from all stakeholders and reacting to it, where appropriate.
5. THE AMI CONTROL ROOM: AN EARLY WARNING SYSTEM
One of the key purposes of a great management system is to promote identifying and using knowledge
across the enterprise and to create a system to gather and disseminate knowledge in a business. This
knowledge occurs in the form of books, best practices, rules of engagement, checklists, etc. There are
endless elements of knowledge that we are constantly trying to move into the working elemental cells of
the business, so as to confirm that knowledge is indeed being leveraged at the operational levels. So the
ideal management system is focused on the flow of information through the business, through the
management system itself. It is very focused on widening knowledge, spreading and pushing it into the
business. Leveraging knowledge has consistently proven to have a great return for any business.
A key operational component for industries such as
space flights, television broadcasting, and nuclear
engineering is the use of a control room. A nuclear
control room sits above the power plant, so to speak,
constantly monitoring readings from all systems. The
control room is all electronic. It’s got all the
information. It’s got knowledge and algorithms about
why this temperature is too high, or too low;
combinations of readings and algorithms. Its first job
is to be a “canary in the mine,“ to provide warnings of
danger based on sensory perception. However, a
nuclear control room is much more sophisticated than
a canary. It’s not just a reactionary warning to current
conditions, such as the presence of carbon dioxide.
Because of the continual increase of knowledge,
having the right intelligence embedded within the
system, and the flow of information to the control
room itself, nuclear control rooms have become
extremely sophisticated and even predictive. They
operate within a trajectory of information flows and
provide early warnings of things that might happen.
One of the key discerning points for Management 2.0, and the revolutionary aspect of AMI, is the
introduction of similarly intelligent “controls rooms,” i.e., the capability for greater quality assurance, within
the management control system. These are intellectual control rooms, data flow controls throughout the
whole management system. Imagine a pipeline of information flowing between all the management cells
of a business. AMI applies the concept of having a “best manager” or “best consultant” functioning as a
control unit on this pipeline, constantly examining the flow of data through it, constantly setting up dials
and dashboards for warnings and analytics, constantly creating and enhancing the electronic repository of
all this information. Like our nuclear control room, the AMI control room is aware of past performance,
current operating conditions, and potential danger to the business. It has become a living, breathing
organism, with intellect.
Control rooms thus provide a unique opportunity to apply internal and external knowledge to operational
activities. They synthesize historical data with current knowledge and predict future courses of action.
AMI is designed to enhance the sharing of information and provide agility in control rooms to allow rules
and reasoning procedures to be adapted as needs dictate. In designing it, we enabled “double loop”
learning as defined by Argyris and Schön (1978: 2, and 1996:28 ff). Their classic single-loop example is a
thermostat that turns on/off based upon the temperature of the room. If we apply double-loop thinking, we
realize we aren’t trying to control temperature at all; what we’re trying to control is "comfort." So we
modify our model to incorporate measures and controls for humidity, air flow, and other characteristics in
addition to temperature that impact our situation. This is what the AMI control room allows us to do. An
6. individual manager can establish new perceptive qualifiers at any time, and thereby expand or transcend
the current paradigm for monitoring and control. This is indeed a new paradigm, one which will enlarge
the frame of management capabilities.
This in turn allows total transparency into the operational environment. It addresses these critical factors:
•Available operational data (Where are we now?)
•Desired happenings (Where do we want to go?)
•Internal or external benchmarks (What is our target? What are the danger signs?)
•Must-do items (What are my checkpoints?)
It also incorporates things like "never again” knowledge; analysis and reports; team and management
communications; and early warnings and alerts.
LIKE AN EXCEL SPREADSHEET
The nuclear control room functions as a power center, usually at the center of the organization. The AMI
control room, by contrast, is a "bottom up" model, where every single entity uses a control room - and
shares its information across the organization. It is also easy to implement, similar to plugging an air
filter or carbon monoxide detector into every room in your house. Democracy of information means that
everyone has a control unit, a sensory monitory; it also means all control rooms are cognizant of all other
control rooms, so that all can leverage the collective information of the neural network.
The concept of AMI, control rooms, and knowledge flow is wonderful, but it has to be implemented in a
“traditional” computer system. Historically, we have spent decades doing analysis and architecting
management information systems. Years writing, programming and testing them. And after we
accomplish a certain level of success, they remain at heart computer systems: changes are difficult and
time-consuming. The technology, in fact, can stifle the flexibility we need in order to remain competitive.
What managers need is an implementation
method as easy to use as an Excel spreadsheet, a
model that allows a manager to build a control
room very, very quickly. Where he/she can very
quickly define the data, the rules, and what these
mean to the specific business unit. And where the
manager can quickly change dashboards, events,
rules, etc., as easily as he/she can modify a
spreadsheet. That’s because in the 2.0 world,
once you build your control room, you need the
ability to change it easily. It’s not that you’d “like
to,” it’s that you “NEED to” build those control
rooms in a matter of days, not in months. You
need to be able to build those control rooms
without access to a computer engineer. The
manager is the one who understands the
business. The manager understands the data. He/
she is the one who needs to be able to define it
and use it to manage the cell.
Imagine that one of us can build a control room to monitor our business unit or department or other
organizational entity, just like the nuclear control room. And every manager in the organization can set up
one for his/her business unit. And each control room is like a LEGO piece, that we can snap together into
a coherent, integrated system. The assembled structure is able to leverage the collective awareness of
ALL control rooms, so that a control room at any location in the structure is instantly aware of potential
7. problems anywhere else in the enterprise. This is true democracy of information. All pieces constantly
aware, all assembled by business managers, none requiring computer engineers.
COLLECTIONS OF CONTROL ROOMS: MANAGEMENT 2.0
This is the absolute, stunningly simple value proposition, this ability to combine control rooms into higher-
order, more complex management groupings. The strength of the AMI model lies in its ability to network
all cells in the enterprise, and to add new cells as a
business organization changes. These changes
can occur in the form of mergers and acquisitions,
or by extending the model to incorporate entities
previously excluded from AMI. They can also occur
when a management cell splits into smaller ones.
The management model for the 2.0 world must
allow an infinite number of control rooms. With
increased complexity, the guidance available is
much more than the sum of its parts. This is the
concept of “a rising tide floats all boats.” AMI allows
managers to leverage the human insight of the “A”
players so that B, C, and D players function on the
same level as “A” players. This is a true democracy
of information.
With the addition of formal and informal systemized
knowledge relevant to the operation of the
management cell, we can achieve better outcomes with fewer resources. We do so by:
•Deploying an agile management information flow
•Integrating hard and soft data
•Eliminating human data filters of bad news – or exaggerated good news
•Providing formal checkpoints and quality assurance (QA) of information and information processing
•Ensuring formal records of information exist within a permanent repository
•Providing the ability for true management review and governance without the time-consuming efforts of
needing to form a management picture of the past
•Making all this easy to modify by formalizing the cell model in a control room environment
ARCHITECTURAL PRINCIPLES
Advanced Management Insight is a revolutionary concept for
managing business performance in the Web 2.0 world. At its
core is a management control unit, with five components.
These are summarized in the accompanying AMI graphic,
showing input in the form of operational information and the
expert knowledge system; output via the analysis and
presentation system, including active warnings; and a
comprehensive data repository for all management
information. At its heart, of course, is the AMI control
room.
8. EACH COMPONENT HAS A SPECIFIC FUNCTION:
This combines quantitative data with subjective team feedback to present a constant
stream of operational data to the AMI Control Room. It imports data from existing data
systems and gathers “feedback” from the ground up, in the form of stakeholder responses
to prompts. This is normally yes/no, e.g., “Do you have the tools you need to complete
your task?” These are role-specific, so that all participants in a process are prompted
with identical status checks.
This is a library of expert knowledge including best practices, KPIs, standard processes,
and management expertise. It represents a systematic application of best practices and
standard processes, augmented with discrete business knowledge from the specific
organization. This allows the organization to meld its own knowledge with that of the
external enterprise.
This takes the data from the AMI Control Room engine and provides robust visibility and
insight into the status of the business. For upper management, it comprises robust,
interactive dashboards that provide “at a glance” access to enterprise data with the ability
to drill down into the empirical data and the subjective assessment of that data by
participants. This provides management with insight into the opinions and awareness of
issues that affect the business. It also serves as an early-warning system.
This is the repository of historical data, findings, and analysis. It
reflects all ongoing data as well as data from prior review cycles. It is much more
encompassing than traditional business intelligence data, because it incorporates
subjective knowledge. It is a comprehensive diary for all reviews throughout the life of a
business.
This is the core of AMI, the brains of a control room. It ensures that the organization
conducts consistent, phase-by-phase QA review. It achieves this by constantly feeding
operational and human data through several core systems to identify risks, any activities
off track, and compliance with best practice. It has a built-in issue tracking system and a
risk-assessment and scoring engine. It performs KPI scoring and reporting and schedules
QA reviews and monitors QA compliance.
This is the absolute, stunningly simple value proposition, the ability to combine control rooms into higher-
order, more complex entities.
PRACTICAL IMPACT
The Management 2.0 information and control system will benefit all decision-makers at all levels of the
organization. We believe Advanced Management Insight will function as a knowledge reservoir that is all
of the following:
Complete: AMI is holistic, including economic, political, demographic, and other information. It is also
global and will include information from outside the organizational boundaries of the business entity. This
includes customers, suppliers, shareholders, legislators, etc.
Subjective: AMI contains empirical data, such as that found in production or accounting systems, but
the data will be correlated to opinions, perceptions, concerns, attitudes, needs, wants, skills, etc. It will be
objective data wrapped with subjective knowledge. AMI will continuously, dynamically, and pro-actively
obtain information from multiple human sources.
9. Infinitely Connected : Democracy of data means that all stakeholders are enabled to access all
information, thereby creating a web of unlimited connections.
Self- Aware: AMI will monitor information by inference rules, such as an inference engines deploying
artificial intelligence; it will pro-actively trigger human assessment of what it finds. All data will be
situationally aware, able to self-identify deviations from nominal states and potential risks, and trigger
alerts and dynamically seek data.
Benefits
AMI supports the 2.0 manager by providing benefits in four areas:
INFORMATION FLOW
•Establishes a prescribed, but easily modifiable information network that will constantly gather empirical
data and feedback data (personal perspectives) from all relevant sources of information.
•Builds a complete data repository as a natural by-product of the normal work flow.
KNOWLEDGE REPOSITORY
•Allows for a permanent and easily accessible common repository of the organizational information data.
•Continuously monitors the information flow and has intelligence, review, and quality assurance of the
data, its use, and value.
•Easily facilitates the addition of a “growing and endless” addition of nodes of knowledge, intelligence,
and control rooms at low cost, rework, or time delay.
SPEED TO MARKET
Managers can modify their view of business – and act on the knowledge they are acquiring – in a matter
of hours and days, instead of the weeks and months needed to modify current management information
systems. AMI is a model allowing managers to implement their own configuration without requiring
computer programming.
HUMAN KNOWLEDGE
•Incorporates 360⁰ degree feedback into actionable information for management.
•Provides “intelligent” analytics to help management understand current-state data, the emerging risks,
and trend information.
•Automatically maintains a permanent diary and repository.
•Implements a self-learning and heuristic system.
•Opens role-based actionable information to all levels of management.
•Dramatically reduces or eliminates the hiding and filtering of bad news and information.
•Enables and solicits mass team feedback, advice, suggestions, and collaboration.
•Encapsulates organizational knowledge into the organizational data flow.
In short, AMI elevates the information flow from being a report of “what happened yesterday” into a
dynamic new model that provides a comprehensive knowledge base and intelligently active review
system that will automatically assume many of the current QA functions embedded in the management
review process. AMI provides a solid knowledge base for operational analysis and improvement of
10. people, processes, and effectiveness. It makes the management information system alert, warning
sensitive, and predictive.
Challenges
We believe the primary challenges for implementing AMI are socio-cultural in nature. In implementing
AMI, management must lead the organization in understanding the need for, and value of, comprehensive
data.
As noted, a rising tide floats all boats. We also anticipate that AMI will enable the organization to elevate
the effectiveness of all stakeholders. If our B, C, and D players are now as effective as our "A" players,
we'll have a stellar team. We also won't need as many managers.
First Steps
The first step toward revolutionizing Management 2.0 is to address these challenges, primarily in the form
of management education and training. We anticipate the following steps vis-a-vis our vision:
Enlarge the frame of management education: Business KPIs and subjective perceptions are a
fact of life. The ability to correlate the two in a meaningful fashion, especially from across the enterprise,
is a paradigm shift. We need to teach our managers how to leverage this collective wisdom, how to
apply insight in what will become an open organization.
Moreover, AMI enables the electronic equivalent of "management by walking around" in a virtual
enterprise, where stakeholders are physically dispersed at multiple locations. This provides an entirely
new frame of reference for 2.0 managers, and they will need training in how to best use it to manage
people across an "e-enterprise."
Retool management for an open world: In a similar fashion, 2.0 managers will need to apply new
management techniques to "manage" a shifting mass of people, projects, and cells -- many of whom are
not "owned" by the business. In the borderless world of Web 2.0, the entities participating in a business
enterprise may be internal; they may be external. AMI opens the knowledge base to an infinite number of
participating cells; 2.0 managers need to learn how to then energize, mobilize and "manage" them.
Knowledge has always been an asset to businesses. What's different in Management 2.0 is that
knowledge has also become an active tool in the business, both a strategic and operational tool. We will
need to train our managers how to use it better -- how to partner with it, accept it, and deploy it.
Create a democracy of information: When awareness and knowledge is spread across the
enterprise, all stakeholders are in fact empowered to act. AMI allows managers to "control" employee
behavior by ensuring that everyone is on the same page, so to speak. Instead of issuing edicts, 2.0
managers will need to learn how to manage by transmitting knowledge.
"Democracy of information" doesn't negate the fact that organizations are vertical and that someone
above you is paying your salary. Providing total transparency enables all stakeholders to work with the
same set of data, tools, and business objectives. By creating an enterprise model for collecting subjective
knowledge, in fact, AMI becomes objective in removing the emotion-filled judgments or hype from the
business model. At the operational level, it means the first-level employees in fact can work with totally
objective business rules.
Life happens, and change is part of it. Technology architects are already dealing with designing and
creating a constantly changing management system. This is one of the most technically challenging, and
exciting, environments my industry has faced in the past 30 years. With AMI
(http://www.amiplatform.com/default.aspx?pageid=2777) we are attempting to create an infinitely open
architecture that “automates” human knowledge across an enterprise. We are in effect trying to automate
knowledge across the known universe while simultaneously anticipating the unknown. From our
perspective, we have created an AMI 1.0, and we are eagerly awaiting our next steps as we move toward
2.0.