information systems for managers smitha ramachandran units 5 – 6
TRANSCRIPT
Information Systems for Managers
Smitha Ramachandran
Units 5 – 6
Management Information Systems (MIS)
Defined as an integrated system of man and machine for providing the information to support the operations, the management and the decision-making function in the organizationDeals with information that is systematically and routinely collected in accordance with a well-defined set of rulesInformation provided by an MIS assists managers in planning, organizing, staffing,coordinating,directing and controlling the operations of an organization
Unit:5
Connective Actions
Planning
Control
Operations
Plan & Targets
Management Control Systems
•MIS is concerned with planning and control
•Has large amount of data as its integral part that is stored and managed by a data base management system
Features
Must be capable of handling voluminous data. The data and transactions must be validatedMust be able to perform operations on the data irrespective of the complexity of the operationsShould facilitate quick search and retrieval of information. Must support mass storage of data and informationInformation must be communicated to the receipt in time
IS uses in Functional Areas
Finance and Accounting To forecast revenue and business activity To determine the best sources and uses of funds To manage cash and other financial resources and
analyzing investment To check the financial health of an organization
Sales and Marketing Product Analysis: Used to develop new goods and
services Site Analysis: to determine the best location for
production and distribution facilities Promotion Analysis: to determine the best advertising
and sales approaches Price Analysis: to set product prices to get the highest
total revenuesContd…
Manufacturing To process customer orders Develop production schedules Control inventory Monitor product quality
Service industry To serve the customer better and
maximize their profit
Banks and other investment firms To make good investments and sanction
sound loans
Contd…
•An organization
• must respond to market forces, competition, to environmental and technological changes
•Must do long term planning
•Different Methodologies for Strategic Planning are available
•According to the model suggested by Robert Anthony Strategic Planning plays an important role in planning and control system
Framework of Business Planning and Control
Strategic Planning
Management Control
Operation Control
Planning and
Control Systems
•Strategic Planning: the process of the organization, determining the possible shift in objectives, deciding on the resources used to attain their objectives and the policies that govern the acquisition, use and disposition of there resources
•Management Control: the process by which managers assure that the resources are obtained and used effectively and efficiently to attain the objectives of the organization
•Operational Control: the process of assuming that specific task are carried out effectively and efficiently
Planning and Control Activities in Different Functional Areas
Strategic Planning
Management Control
Operational Control
Production
Location of new factory
Determine the product mix
Scheduling specific jobs on specific machines in a shift
Marketing
Entering the export market
Media Planning for advertising expenditure
Planning sales contacts to be made in the next week
Finance Raising capital by issuing new shares
Determining maximum levels of credit for customers
Determining what action to take against on payment by a specific customer
Personal Deciding on changes to be made in the organization Structure
Determining who will be promoted to fill a vacated post at middle or lower level,in the organization
Determining which workers will be on each shift
Anthony’s Framework: Differences in Information Required for three types of Planning and Control Process
Information characteristic
Strategic planning
Management Control
Operational Control
Volume Low Intermediate High
Levels of Aggregation
High Intermediate Low
Frequency of use of particular type of data
Low Intermediate High
Currency Requirement
Low Intermediate High
Accuracy Low Intermediate High
Scope Wide Intermediate High
Source Significant amount from external sources
Mostly Internal Entirely internal
Predictability with user
Low Fairly high Very high
Variability with user High Intermediate Low
Distance of user from sources within organization
Fair Fairly close close
Simon’s Framework
Broken down the process of decision making into three stages Intelligence: stage in which decision
maker recognizes that there is a problem or opportunity that requires him to make a decision
Design: decision maker determines the alternatives that are available to him to resolve the problem
Choice: finalizes from the alternatives. The selection process requires feasibility analysis or cost-benefit analysis
The three major classes of decisions with Simon’s framework
Programmed decisions: All stages are handled by following a preset well-defined
procedure Decisions are repetitive and routine that arise often Mathematical model can be made in their entirety Eg: inventory-ordering decisions
Non-programmed decision: Difficult to structure in logical-mathematical terms Cannot be handled by following preset or well-defined
procedures Not repetitive in nature and require fresh intelligence,design
and choice phases to be executed Eg: setting up of a factory or new product
Semi-programmed decision: At least one or maximum of two can be handled by preset
well-defined procedures
Zani’s model for MIS design
Important determinants in the MIS design: Opportunities and risk Company strategy Company structure Management and decision-making
process Available technology Available information sources
Factors Facilitating Implementation of MIS
Involvement of top management in the computerization effort, in defining the purpose and goals of computers within the organizationSelection of an EDP manager who has political skills to involve managers in choosing application areas, identifying information needs and designing reportsA computer staff, who has interdisciplinary skills in computers, management and operations managementA balanced expenditure in hardware and software
Organization and IS: A 2-way relationship
An organization is an open system that adjust according to the changing environmentWhile designing MIS for an organization the requirements to be kept in mind: MIS should be designed viewing organization as a system Should give weightage to human side of the organization
and its culture Should give reports to main decision maker Should give control information to the higher
management, if organization follow hierarchy with a high degree of centralization
should give functional design if the organization is structure on a functional basis
If the organization works on a standard system where rules, policies, systems and procedures have been laid down, then these becomes part of MIS
Unit 6:
Information Systems Economics
Data Raw material
Information Processed data Defied as data that have been put into a
meaningful and useful context and communicated to a recipient who uses it to make decisions. It reduces uncertainty, reveals additional alternatives or helps eliminate irrelevant or poor ones
Data-Information-Knowledge
DATA
CONTEXT INDEPENDENCE
UNDERSTANDING
INFORMATION
KNOWLEDGE
WISDOM
understanding relations
understandingpatterns
understandingprinciples
Desired characteristics of Information•Accurate
•Complete
•Economical
•Flexibility
•Reliable and verifiable
•Relevant
•Simple
•Timely
•Accessible and Secure
Generate Manipulate
Synthesize
Sort
store
RetrieveStore
Destroy
Utilize
Data Life Cycle
IS: Success and Failures•A project is success
•If it is completed within time and budget
•It must meet needs of its users and organization
Over a period of time the success and failure factors identified are:•Project scope: should be stable and well understood
•An MIS project that aims for BPR are of high-risk but at the same time have high potential for
major benefits
•Technology development platform and development language exposure
•Support from the management
•Objective of MIS must be in tune with that of the organization
•System should be user friendly and the response time should be reasonable
•MIS should be developed with a clear objective and that must be documented before the implementation
•Data policy should be formulated
•Quality control plan must be in place
•concerned people must be adequately trained
•System should be properly documented so that attrition does not affect MIS adversely
Thank You