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Management Information System

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Dynamic Business Environment

Blurring Business Boundary

Cut-Throat Competition

Demanding Customers

Vigilant Government, Regulator and Judiciary Changing Role of Trade Partners

Wider Choice with Employees

* No Space for Complacency

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Management Information System

Management : Optimal Resource Utilisation

Decision Making (Structured Vs. Unstructured)

Information: Processed Data (Types)

System: Composed of 4 Ms

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Management Information System (contd..)

MIS is an integrated man/machine system for providing

information to support operations, management and decision

making function in an organisation. This system utilises computer

hardware, software, manual procedures, management, decision

models and a database.

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The Interdependence between Organizations and

Information Systems

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MIS functioning

Data Collection

Data Entry

Data Transformation

Information

Dissemination

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TheBusiness Information Value Chain

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E-Business

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MIS Model

SDLC, Prototyping, CASE Tools

Facilitates Strategic Decision Making

Supports Management Control

Supports Operational Control

Improves Product Quality

Improves Product Delivery

H

A

R

D

W

A

R

E

S

O

F

T

W

A

R

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D

A

T

A

P

E

O

P

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E

P

R

OC

E

D

U

R

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Why ??

What ??

How ??

* Impro vement in Eff iciency, Effect iveness ?

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Characteristics of MIS

Management Oriented

Management Directed

Common Database

Common Dataflow

Integrated Sub-System concept

Heavy Planning element

Flexibility

Computerised

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Pre-requisites of Effective MIS

Top Management Support

Qualified systems

Technology Oriented Staff

Database Control of MIS

Evaluation of MIS

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Constraints in Implementing MIS

Lack of skilled professionals

High Turnover of experts

Lack of staff cooperation

Large investment & huge time requirement Benefits not known to management

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Limitations of MIS

Most suitable for structured decisions

Lesser fit for qualitative data

Not a substitute for effective management

Rapidly changing environment requires rapidcustomisation in IS

Quality of inputs determines quality of output

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Types of Information Systems

in the

Enterprise

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TypesofInformationSystems

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MajorTypesofInformationSystems

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TransactionProcessingSystems

(TPS) Basic business systems that serve the operational

level

A computerized system that performs and records the

daily routine transactions necessary to the conduct of

the business

Includes set of procedures for handling transaction

activities calculation, classification, sorting,storage, summarisation

High volume but similar with few exceptions

What is Transaction? Examples

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A SymbolicRepresentationfor a

PayrollTPS

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TypicalApplicationsofTPS

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TypesofTPS

Online (Real time) Vs. Offline (Batch

Processing) System

Master Files Vs. Transaction Files

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ManagementInformation

Systems(MIS)

Management level

Inputs: High volume transaction level data

Processing: Simple models

Outputs: Summary reports (Types)

Users: Middle managers for Structured &Semi-structured Decisions

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ManagementInformationSystems

(MIS)(continued)

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Decision-SupportSystems

(DSS)Management level

Inputs: Transaction level data & MISReports

Processing: Interactive

Outputs: Decision analysis

Users: Middle & Top-Level Managers

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Decision Support System

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DSS is an interactive CBIS which help decision makers

utilise data & models to solve unstructured problems

- Scott Morton

DSS is an interactive, flexible & adaptable CBIS that

utilises decision rules, models and a modelbase

coupled with a comprehensive database & the decisionmakers own insight.

DecisionSupportSystems

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Ability to support solution of complex problems

Designed to support semistructured and unstructured

problems

May be constructed to support one-time decision Typically designed for one decision-maker or a group of

decision-makers

Ability to quickly & objectively try different strategies under

different configuration

Greater emphasis on models, ad-hoc queries, display

graphics

Emphasizes change, flexibility, and a rapid response

CharacteristicsofDSS :

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DSS database: A collection of current or historical data

from a number of applications or groups

DSS software system: Contains the software tools for

data analysis, with models, data mining, and other

analytical tools

DSS user interface: Graphical, flexible interaction

between users of the system and the DSS software

tools

ComponentsofDSS

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Statistical models

Optimization models

Forecasting models

Sensitivity analysis (what-if models)

Model: An abstract representation that illustrates the

components or relationships of a phenomenon

ComponentsofDSS

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A DSSforCustomerAnalysisand

Segmentation

What is Data Visualisation?What is Geographic Information System ?

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GDSS is an interactive computer-based system used to

facilitate the solution of unstructured problems by a set ofdecision makers working together as a group.

GroupDecision-Support System

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Hardware (conference facility, audiovisual

equipment, etc.)

Software tools (Electronic questionnaires,

brainstorming tools, voting tools, etc.)

People (Participants, trained facilitator, support staff)

MainComponentsofGDSS:

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In a GDSS electronic meeting, each attendee has a workstation.

The workstations are networked and are connected to the facilitators

console, which serves as the facilitators workstation and control

panel, and to the meetings file server.

All data that the attendees forward from their workstations to the

group are collected and saved on the file server.

The facilitator is able to project computer images onto the projection

screen at the front of the room.

Overviewofa GDSSMeeting

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GDSS allows a greater number of attendees.

Enables collaborative atmosphere by guaranteeing contributors

anonymity.

Enables non-attendees to locate organized information after the

meeting.

Increases the number of ideas generated and the quality of decisions

while producing the desired results in fewer meetings

Can lead to more participative and democratic decision making

BusinessValueofGDSS

What is Customer Decision Support System ?

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Stagesin DecisionMaking

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Information quality: Accuracy, integrity, consistency,

completeness, validity, timeliness, accessibility

Management filters: Biases and bad decisions of managers

Organizational inertia: Strong forces within organization that

resist change

DecisionMakingintheRealWorld

In the real world, investments in decision-support systems

do not always work because of

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Six Major Trends:

Detailed enterprise-wide data

Broadening decision rights and responsibilities

Intranets and portals

Personalization and customization of information

Extranets and collaborative commerce

Team support tools

TrendsinDecisionSupport &

BusinessIntelligenceThe rise of client/server computing, the Internet, and Webtechnologies made a major impact on systems that support

decision making.

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ExecutiveSupportSystems(ESS) /

StrategicInformationSystem(SIS)

Inputs: Aggregate data

Processing: Interactive

Outputs: Projections

Users: Senior managers

Example: 5 year operating plan

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ObjectiveofESS/SIS

Involves a study of how the IS function can contribute to the

achievement of goals contained in the strategic plan

To improve firms performance & competitive position

What is Strategy?

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BenefitsofESS/SIS

Pinpoints ways to achieve competitive advantage of using IS as a

strategic weapon

Stimulates creative use of IS technology & encourages innovations

in applying it to organisational needs

Redeploys resources to the important IS projects for business

Encourages the integration of existing & future IS to eliminateredundancy, inconsistency & inefficiency

Establishes priority & timeframe for development of IS in future

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OfficeAutomationSystem (OAS)

IS for making offices more efficient

IS that collect, process, store & transmit e-messages, documents

and other forms of communications among individuals, workgroups

and organisations.

Increases productivity of managers Reduction in time & efforts

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ComponentsofOAS

Office Publishing System: Word-processing, DTP

Image Processing: Scanning, Interactive videos, Storage

Electronic Communications: emailing, tele/Video-conferencing, Fax

Support system : e-Calendar, Task Management System,Directory System, Work Schedule

Limitations: Compatibility, storage?

What are Functional Information system?

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SalesandMarketingSystems

SYSTEM DESCRIPTION ORGANIZATIONAL

LEVEL

Order

processing

Enter, process, and track orders Operational

Pricing analysis Determine prices for products and

services

Management

Sales trend

forecasting

Prepare 5-year sales forecasts Strategic

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SYSTEM DESCRIPTION ORGANIZATIONAL

LEVEL

Machine

control

Control the actions of machines and

equipment

Operational

Production

planning

Decide when and how many products

should be produced

Management

Facilities

location

Decide where to locate new production

facilities

Strategic

ManufacturingandProduction

Systems

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Financing& AccountingSystems

SYSTEM DESCRIPTION ORGANIZATION-

AL LEVEL

Accounts

receivable

Tracks money owed the firm Operational

Budgeting Prepares short-term budgets Management

Profit

planning

Plans long-term profits Strategic

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HumanResourceSystems

SYSTEM DESCRIPTION ORGANIZATIONAL

LEVEL

Training anddevelopment

Tracks employee training, skills,and performance appraisals

Operational

Compensation

analysis

Monitors the range and distribution

of employee wages, salaries, and

benefits

Management

Human resources

planning

Plans the long-term labor force

needs of the organization

Strategic

Need for Enterprise Systems?

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Designed to support organization-wide process

coordination and integration

Consist of :

Enterprise systems

Supply chain management systems

Customer relationship management systems

Knowledge management systems

EnterpriseApplications

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EnterpriseSystems

Also known as enterprise resource planning (ERP)

Provides a single information system for organization-wide

coordination and integration of key business processes.

Seamlessly flow of Information throughout the firm

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BenefitsofEnterpriseSystems

Help to unify the firms structure and organization: One

organization

Management: Firm wide knowledge-based management

processes

Technology: Unified platform

Business: More efficient operations & customer-drivenbusiness processes

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ChallengesofEnterpriseSystems

Difficult to build: Require fundamental changes in the way

the business operates

Technology: Require complex pieces of software and large

investments of time, money, and expertise

Centralized organizational coordination and decision

making: Not the best way for the firms to operate

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Network of organizations and business processes for

procuring raw materials, transforming into products, and

distributing them to customers

SCM: Coordination of business processes to optimise

information, product, and fund flows up and down a supply

chain to reduce time, redundant effort, and inventory costs

SupplyChain

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SupplyChain

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SupplyChainManagement(SCM)

Network of organizations and business processes

Integrates supplier, manufacturer, distributor, and customer logistics time

Reduces time, redundant effort, and inventory costs

Helps in procurement of materials, transformation of raw materials intointermediate and finished products

Helps in distribution of the finished products to customers

Includes reverse logistics - returned items flow in the reverse directionfrom the buyer back to the seller

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Information& SCM

Decide when and what to produce, store, and move

Rapidly communicate orders

Track the status of orders & inventory levels

Reduce inventory, transportation, and warehousing costs

Track shipments

Plan production based on actual customer demand

Rapidly communicate changes in product design

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Scheduling system for minimizing inventory by having

components arrive exactly at the moment they are needed

and finished goods shipped as soon as they leave the

assembly line

Just-in-time strategy :

InformationandSupplyChainManagement

Inaccurate or untimely information causes inefficiencies in

supply chain, such as shortages, excessive inventory

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CustomerRelationshipManagement

(CRM)

Manages all ways used by firms to deal with existing and

potential new customers

Business and technology discipline

Uses information system to coordinate entire business

processes of a firm

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CustomerRelationship

Management(CRM) (Continued) Provides end- to- end customer care

Provides a unified view of customer across the company

Consolidates customer data from multiple sources and provides

analytical tools for answering questions

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CustomerRelationshipManagement

andPartnerRelationshipManagement CRM

Business and

technology discipline for

managing customer

relationships to optimize

revenue, profitability,

customer satisfaction,

and customer retention

PRM

Automation of the firms

relationships with its

selling partners using

customer data and

analytical tools to

improve coordination

and customer sales

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CRMApplications

Capture and integrate customer data from all over the

organization

Consolidate and analyze the data

Distribute results to various systems and customer touch

points across the enterprise

What is a touch point ?

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OperationalandAnalyticalCRM

O-CRM

Customer-facing

applications, such as call

center and customerservice support,

telemarketing and

marketing automation

A-CRM

Applications that

analyze customer data

generated by O-CRMapplications to provide

information for

improving business

performance

What is Collaborative CRM?

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BusinessValueofCRM

Increased customer satisfaction

More effective marketing and reduced direct marketing costs

Lower costs for customer acquisition and retention

Increased revenue from identifying most profitable customers

and segments for marketing, cross-selling, up-selling

Reduced customer churn

l d S

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KnowledgeManagementSystems

(KMS)

Collects relevant knowledge and make it available wherever and

whenever it is needed

Support business processes and management decisions

Also link the firm to external sources of knowledge

Support processes for acquiring, storing, distributing, and

applying knowledge

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KnowledgeManagementValueChain

E S

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ExpertSystem

Term originated as it was aimed initially at replicating theabilities of human expertise

A kind of KMS which employs human knowledge stored incomputer to solve problems that originally require expertise

Can be used by non-experts to improve their problem solvingabilities

Can function better than an expert specialised in narrow domain

S f ES

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StructureofES

Development Environment: Used by ES builder to build thecomponents & introduce experts knowledge into ES

knowledge-base

Consultation Environment: Used by a non-expert to obtain theexpert knowledge & advise

C f ES

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ComponentsofES

Knowledge Acquisition Expert & Knowledge Engineer

Knowledge Base Rules & Facts

Inference Engine (Brain)

Blackboard (Workplace)

User Interface Natural Language

Explanation (Justifier)

Reasoning Capability Improvement Knowledge Refinement

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TheSystemsDevelopmentProcess

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SYSTEMSDEVELOPMENTPROCESS

Systems analysis: The analysis of a problem that the

organization will try to solve with an information system

A detailed statement of the information needs that a

new system must satisfy

Identifies who needs what information, and when,where, and how the information is needed

Feasibility study: Process of determining whether the solution

is achievable, given the organizations resources andconstraints

Technical/ Economic/ Behavioural Feasibility

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Unit Testing: Testing each program separately in the system

(program testing) System testing: Testing the information system as a whole to

determine if discrete modules function together as planned

Acceptance testing: Provides the final certification that the

system is ready to be used in a production setting

The exhaustive testing to determine whether the system

produces the desired results under known conditions

Testing

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Conversion

1. Parallel strategy

2. Direct cutover strategy

3. Pilot study strategy

4. Phased approach strategy

Process of changing from the old system to the newsystem

Four main conversion strategies

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Post-implementation Audit & Review by users and

technical specialists to determine how well it has met its

original goals

Production

Changes in hardware, software, documentation, or

procedures to a production system to correct errors,meet new requirements, or improve processing

efficiency

Maintenance:

Limitation of SDLC Approach?

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Prototyping

Building an experimental system quickly and inexpensively for

demonstration and evaluation and used as a template for the

final system

Iterative & interactive process that combines steps of

traditional SDLC

Prototype is modified several times before end-users find it

acceptable

Hastily constructed systems, however, may not accommodatelarge quantities of data or numbers of users.

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ThePrototypingProcess

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Software tools to automate development and modeling

methodologies

Enforce a standard development methodology and design

discipline Organize and correlate design components and provide rapid

access to them using a design repository

Automate tedious and error-prone portions of analysis and design

Automate code generation and testing and control rollout

Computer-AidedSoftwareEngineering

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ManagementofData

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FileOrganization

Bit: Smallest unit of data; binary digit (0,1)

Byte: Group of bits that represents a single character

Field: Group of words or a complete number

Record: Group of related fields

File: Group of records of same type

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Database: Group of related files

Entity: Person, place, thing, event about which information is

maintained

Attribute: Description of a particular entity

Key field: Identifier field used to retrieve, update, sort a record

FileOrganization

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Entitiesand Attributes

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DatabaseManagementSystem(DBMS)

Software for creating and maintaining databases

Acts as interface between application programs and data files

Separates logical and design views of data

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ComponentsofDBMS:

Data definition language: Specifies content and structure of

database and defines each data element

Data manipulation language: Used to process data in a

database

Data control language: Used to control data in a database

Data dictionary: Stores definitions of data elements and datacharacteristics

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Typesof Databases

Hierarchical and network DBMS

Relational DBMS

Object-oriented databases

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HierarchicalandNetworkDBMS

Organizes data in a tree-like structure

Supports one-to-many parent-child relationships

Prevalent in large legacy systems

Hierarchical DBMS:

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HierarchicalDatabaseforHumanResourcesSystem

N t k DBMS

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Depicts data logically as many-to-many relationships

NetworkDBMS:

R l ti l DBMS

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RelationalDBMS:

Represents data as two-dimensional tables called relations

Relates data across tables based on common data element

Concept of Primary, Foreign, Candidate, Alternate, Composite

Key (s)

Examples: DB2, Oracle, MS SQL Server

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TheRelationalDataModel

Obj O i d D b

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Object-oriented DBMS: Stores data and procedures as

objects that can be retrieved and shared automatically

Object-relational DBMS: Provides capabilities of both

object-oriented and relational DBMS

Object-OrientedDatabases:

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Identification of Entities

Data Attributes/ Fields

Data Type

Data Size

Constraints

Establishing Relationship

Normalisation

DesigningDatabases:

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CentralisedVs. Decentralised

Database

E ri D t Q lit

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EnsuringDataQuality:

Accuracy

Completeness

Relevance

Timeliness

What is Data Quality Audit, Data Cleansing?

M ltidim nsi n l D t An l sis

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Online Analytical Processing (OLAP):

Multidimensional data analysis

Supports manipulation and analysis of large volumes of data

from multiple dimensions/perspectives

MultidimensionalDataAnalysis

D W h i

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Stores current and historical data

Supports reporting and query tools

Consolidates data for management analysis and

decision making

DataWarehousing

What is Data Mart/ Data Mining ?

DATABASE TRENDS

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Database Presence on Web

Hypermedia Database

DATABASE TRENDS

Application of Information system

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Application of Information system

E-Commerce

E-Banking

E-Governance

E-Learning

Trends in Information Technology

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Trends in Information Technology

Grid Computing:

Involves connecting geographically remote computers into

a single network capable of working in parallel on

business problems that require short-term access to large

computational capacity

Rather than purchase huge mainframes or super

computers, firms can chain together thousands of smaller

desktop clients into a single computing grid.

Saves infrastructure spending, increases speed of

computing, and increases the agility of firms.

What is Virtualisation, Green Computing?

On-Demand (Utility) Computing

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( y) p g

Firms off-loading peak demand for computing power to remote,

large-scale data processing centers

Developed by IBM, SUN, and HP

Firms pay only for the computing power they use, as with an

electrical utility.

Excellent for firms with spiked demand curves caused by

seasonal variations in consumer demand, e.g. holiday shopping

Saves firms from purchasing excessive levels of infrastructure

What is Software As A Service (SAAS)?

Autonomic Computing

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Autonomic Computing

Computer systems (both hardware and software) have become

so complex that the cost of managing them has risen.

Thirty to fifty percent of a companys IT budget is spent

preventing or recovering from system crashes.

Operator error is the most common cause of crashes.

Autonomic computing is an industry-wide effort to develop

systems that can:

Configure, optimize, and tune themselves

Heal themselves when broken

Protect themselves from outside intruders and self-

destruction

Edge Computing

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g p g

A multitier, load-balancing scheme for Web-based applications.

Processing load is distributed closer to the user and handled by

lower-cost servers.

Lowers cost of hardware

Increases service levels

Provides firm greater flexibility in responding to service requests

Seasonal spikes in demand can be off-loaded to other edge

servers.

Service-Oriented Architecture

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Service Oriented Architecture

SOA refers to the use of Web services in a firm to achieve

integration among disparate applications and platforms.

A firm might have applications (payroll) running on older AS400

IBM machines, IBM mainframes (customer data and inventory)

and newer applications running on client/server networks.

In SOA, these applications are integrated so that information

stored on various systems can be brought together and fed into

newer applications running on more contemporary equipment.

SOA is generally less expensive than rebuilding all the older

applications and adopting a new enterprise wide system.