MIS by tempvaltemp

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   Management Information System   1
           Management Information System

What is an Information System?
• An information system (IS) - or application landscape - is
  any combination of information technology and people's
  activities that support operations, management, and
  decision making
• In a very broad sense, the term information system is
  frequently used to refer to the interaction between people,
  processes, data, and technology.
• In this sense, the term is used to refer not only to the
  information and communication technology (ICT) an
  organization uses, but also to the way in which people
  interact with this technology in support of business

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         Management Information System

• Some experts make a clear distinction between
  information systems, computer systems, and business
• Information systems typically include an ICT
  component but are not purely concerned with ICT,
  focusing instead on the end use of information
• Information systems are also different from business
• Information systems help to control the performance
  of business processes.

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• Another perception for an information system is to
  treat is as a special type of work system.
• A work system is a system in which humans
  and/or machines perform work using resources to
  produce specific products and/or services for
• Thus, An information system is a work system
  whose activities are devoted to processing
  (capturing, transmitting, storing, retrieving,
  manipulating and displaying) information.

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• Hence, it can be said that information systems
  inter-relate with data systems on the one hand and
  activity systems on the other. which supports
  human decision making and provides basis for the
  purpose of taking action.

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   Management Information System

Components of Information

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The following are the components of Information
  –   Management Information System (MIS)
  –   Decision Support System (DSS)
  –   Executive Information System (EIS)
  –   Transaction Processing System (TPS)

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         Management Information System

• A Management Information System (MIS) provides
  information which is needed to manage organizations
  efficiently and effectively.
• Management information systems involve three
  primary resources:
         – People
         – Technology
         – Information.
• Management information systems are distinct from
  other information systems in that they are used to
  analyze operational activities in the organization
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          Management Information System

• A Decision Support System (DSS) is a computer-based
  information system that supports business or
  organizational decision-making activities.
• DSSs serve the management, operations, and planning
  levels of an organization and help to make decisions,
  which may be rapidly changing and not easily
  specified in advance.
• DSSs include Knowledge-based systems

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         Management Information System

• An Executive Information System (EIS) is a type of
  Management Information System intended to
  facilitate and support the information and decision-
  making needs of senior executives by providing easy
  access to both internal and external information
  relevant to meeting the strategic goals of the
• It is commonly considered as a specialized form of
  decision support system (DSS)

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          Management Information System

• A Transaction Processing System is a type of
  information system in which information is collected,
  stored, modified, and retrieved. The information
  pertains to the transactions of an organization.
• The essence of a transaction processing is that it
  manages data that must be left in a consistent state,
  e.g. if an electronic payment is made, the amount
  must be both withdrawn from one account and added
  to the other; it cannot complete only one of those
  steps. Either both must occur, or neither.

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   Management Information System

Role of Information Systems

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Information Systems play the following role in the
functioning of an organization
  • Integration of the entire business unit i.e.
     integration of people, technology and data
  • Provision of data for the purpose of making
  • Provision for automation of manual tasks
  • Channelizing the process for data and information
     flow across various functional units in an

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•   Playing the role of information disseminator across
    the various segments of an organization
•   Playing the role of an assistant in providing the
    necessary information related to day today
    operational, managerial and other tasks of an
•   Playing the role of an observer in the form of
    generating reports /information highlighting the
    critical and potential grey areas so that action can
    be taken accordingly

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•   Playing the role of a catalyst in developing and
    enhancing the operational effectiveness
•   Playing the role of enabler so as to help the
    organization in performing SWOT analysis

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    Management Information System

Impact of Information Systems

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Information Systems impact the organization in the
following manner
• It empowers the employees to quickly and easily
   manage, access, create, share and act on information
   any time, any place and on any device
• It increases organizational knowledge through
   collaboration, by integrating content management,
   tracking and analysis systems.
• This involves easy to use and easy to manage
   development tools, integration with back-end and
   legacy systems, and high levels of security and
   authentication to protect organizational data.
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• It brings about a culture change in an organization
  such as people are more likely to look things up if
  information is easy to access
• It assists in establishing a culture of transparency and
  standardization in the day to day recording and
  classification of operational data
• It impacts in removing the organizational boundaries
  and helps in achieving a 3600 culture
• It impacts the organization in ensuring that the correct
  data /information is recorded and circulated across
  the organization and if not it helps in establishing this
  culture in an organization
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 Management Information System

Different Approaches to
  Information Systems

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Based on the needs of an organization Information
Systems are developed on the following:

             • Conceptual Approach

             • Behavioral Approach

             • Socio Technical Approach

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The Conceptual Approach
This approach takes an holistic, socio-technical
stance, rather than the traditional mechanistic
approach which places most emphasis on the
information technology aspect of the information
system. It focus on four distinct components:
• The information strategy
• The information technology strategy
• The information management strategy
• The change management/ implementation
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The information strategy
The information strategy focus on the following aspects
• What information is required from strategic
• Why this information is required from strategic
• When this information is required
• What is the frequency of this information
• What is the criterion that this information if correct
  and accurate

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Behavioral Approach
• Deals with behavioral issues that arise in the
  development, and long term maintenance of the
  information system
• Different disciplines, such as psychologists,
   sociologists, Economists, study information
   systems, and the impacts they have in the
   organizational environment
• Behavioral changes can occur within the
   organization during, and after information system
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Technical Approach
•   The technical approach uses mathematical
    models to test the capabilities of information
These include:
  •    Computer Science - concerned with methods
       of computability, computation, and data
       storage and access.
  •    Management Science - emphasized the
       development of models for decision making,
       and management practices
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Socio Technical Approach
• An organization can't afford to view its
   information resources as belonging to either the
   techies (technical approach) or the non-techies
   (behavioral approach).
• Responsibility for information belongs to
   everyone in the organization.
• This is the sociotechnical approach — a
   combination of the two approaches i.e. everyone
   has to work together to ensure that information
   systems serve the entire organization
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  Management Information System

Information Systems in the

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           Management Information System

The following are the components of Information
   –   Management Information System (MIS)
   –   Decision Support System (DSS)
   –   Executive Information System (EIS)
   –   Transaction Processing System (TPS)
We are now going to cover the following :
   – Expert systems
   – Enterprise Systems (ERP/SAP, CRM, SCM, BI, DW)

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Expert System
• An Expert system is a computer system that emulates
  the decision-making ability of a human expert.
• Expert systems are designed to solve complex
  problems by reasoning about knowledge, like an
  expert, and not by following the procedure of a
  developer as is the case in conventional programming
• The first expert systems were created in the 1970s and
  then proliferated in the 1980s.
• Expert systems were among the first truly successful
  forms of AI software

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•    An expert system has a unique structure,
    different from traditional programs.
•   It is divided into two parts, one fixed,
    independent of the expert system: the inference
    engine, and one variable: the knowledge base.
•   To run an expert system, the engine reasons about
    the knowledge base like a human.
•   In the 80's a third part appeared: a dialog
    interface to communicate with users.
•   This ability to conduct a conversation with users
    was later called "conversational”
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Enterprise Systems
• Enterprise resource planning (ERP) systems integrate
  internal and external management information across an
  entire organization, embracing finance/accounting,
  manufacturing, sales and service, customer relationship
  management, etc.
• ERP systems automate this activity with an integrated
  software application. Their purpose is to facilitate the flow
  of information between all business functions inside the
  boundaries of the organization and manage the
  connections to outside stakeholders.
• ERP systems can run on a variety of computer hardware
  and network configurations, typically employing a database
  as a repository for information.

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Enterprise Systems contd…
• ERP (Enterprise Resource Planning) systems
  typically include the following characteristics:
   – An integrated system that operates in real time (or next
     to real time), without relying on periodic updates
   – A common database, which supports all applications
   – A consistent look and feel throughout each module
   – Installation of      the system without elaborate
     application/data integration by the Information
     Technology (IT) department

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         Management Information System

• SAP is an acronym for “Systems, Applications and
  Products in data processing which means "Systems,
  Applications and Products in data processing".
• The company was founded in 1972 by the former IBM
  employees Claus Wellenreuther
• SAPs products are in the Enterprise resource
  planning ERP business sector.
• The company's main product is SAP R/3, where the
  "R" stands for Realtime, the number 3 relates to the
  three tier application architecture: database,
  application server and client

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• The main advantage of using SAP as the company ERP system is that
  SAP has a very high level of integration among its individual
  applications which guarantee consistency of data throughout the
  system and the company itself

• In a standard SAP project system, it is divided into three environments,
  Development, Quality Assurance and Production

• The development system is where most of the implementation work
  takes place.

• The quality assurance system is where all the final testing is conducted
  before moving the transports to the production environment.

•   The production system is where all the daily business activities
    occur. It is also the client that all the end users use to perform their
    daily job functions.

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• SAP is a table drive customization software.
• It allows businesses to make rapid changes in their
  business requirements with a common set of
• User-exits are provided for business to add in
  additional source code.
• Tools such as screen variants are provided to let
  the user set fields attributes whether to hide,
  display and make them mandatory fields

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• This is what makes ERP system and SAP in
  particular so flexible
• The table driven customization are driving the
  program functionality instead of those old
  fashioned hard-coded programs
• Therefore,      new    and  changed   business
  requirements can be quickly implemented and
  tested in the system

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Management Information System

   Modules in SAP

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•   ABAP/4 Programming
•   FICO (Financial Accounting &Controlling)
•   HR (Human Resource)
•   SD (Sales and Distribution)
•   MM (Materials Management)
•   Quality Management (QM)

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ABAP/4 Programming
• ABAP       (Advanced     Business    Application
  Programming, ABAP is an object-oriented
  programming language used to develop
  applications for the SAP R/3 system. The ABAP
  programming language was originally used by
  developers to develop the SAP R/3 platform and
  was also intended to be used by SAP customers to
  enhance SAP applications – customers can develop
  custom reports and interfaces with ABAP

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          Management Information System
• An important core module, designed for meeting all
  the accounting and financial needs of an organization.
  Within this module Financial Managers as well as
  other Managers within our business can review the
  financial position of the company in real time and at
  the same time represent the company’s flow of cost
  and revenue, offers all the support information needed
  by Management for the purpose of planning,
  reporting and decision making. Decision making can
  be achieved with a high level of information reducing
  drastically risks. Basically It is a management
  instrument for organizational decisions.

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• HR (Human Resource)
• It deals with various activities done in the human
  resource department of an organization, such as,
  Personal administration, personnel development,
  training and event management, payroll etc. This
  module enables customers to effectively manage
  information about the people in their organization,
  and to integrate that information with ”other SAP
  modules” and external systems

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• SD (Sales and Distribution)
• The SAP sales and distribution is part of the
  logistics module that support your customers,
  starting from quotations, sales order and all the
  way towards billing the customer. It is tightly
  integrated with the MM (Material Management)
  and PP (Product Planning) functional modules. It
  allows companies to input their customer sales
  price, check for open orders and forecast etc.

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• Materials Management (MM)
• Is the materials management module of the SAP.
  This module is used for Procurement Handling
  and     Inventory     Management.    Materials
  management (MM) is integrated with other
  modules such as SD (Sales & Distribution), PP
  (Product    Planning)    and   QM     (Quality
  Management). Materials management is used for
  procurement and inventory management

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• Quality Management
• Quality management is a method for ensuring that
  all the activities necessary to design, develop and
  implement a product or service are effective and
  efficient with respect to the system and its
  performance. Quality management is the
  comprehensive solution that supports the company
  throughout the product life cycle and along the
  supply chain.

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• Customer Relationship Management (CRM)
• CRM stands for Customer Relationship
  Management and is a set of methodologies and
  tools that helps to manage customer relationship
  in an organized way

• A CRM is used for many a business process but let
  consider a very typical workflow for SAP -CRM

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Management Information System

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• A customer may raise an issue with the vendor via
  any medium like Fax, email , telephone etc. If the
  resolution can not be provided immediately by the
  front – end customer representatives they raise a
  ticket in SAP – CRM which is addressed by a more
  technically equipped personnel.
• The resolution is then forwarded to the customer.

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Supply Chain Management (SCM)
• SCM includes features and functions to support
  collaborative supply chain planning processes, including
  strategic, tactical, and operational planning as well as
  service parts planning
• With SAP SCM, you can optimize a full range of planning
  activities, including:
   – Demand planning and forecasting – Forecast and plan anticipated
     demand for products or product characteristics. Use state-of-the-art
     forecasting algorithms for product life-cycle planning and trade
     promotion planning.
   – Safety stock planning – Assign optimal safety stock and target stock
     levels in all inventories in the supply network. Meet your desired
     customer service levels while maintaining a minimum amount of
     safety stock.

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– Supply network planning – Integrate purchasing, manufacturing,
  distribution, and transportation plans into an overall supply picture – so
  you can simulate and implement comprehensive tactical planning and
  sourcing decisions based on a single, globally consistent model. This can
  involve heuristics and capacity planning, optimization, and multilevel
  supply and demand matching.

– Distribution planning – Determine the best short-term strategy to allocate
  available supply to meet demand and to replenish stocking locations. To
  achieve this, planners can determine which demands can be fulfilled by
  existing supply elements.

– Supply network collaboration – Work with partners across your supply
  network. Using collaboration features that improve visibility into supply
  and demand, you and your partners can reduce inventory buffers, increase
  the velocity of raw materials and finished goods through the pipeline,
  improve customer service, and increase revenues.

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– Parts demand planning – Improve the accuracy of forecasts through better
  modeling of demand quantities, events, and their respective deviations. You
  can select sophisticated forecast models and optimize model parameters to
  improve forecasting for slow-moving parts or for parts with irregular demand
  patterns. Through aggregated forecast-parameter profile maintenance, you can
  make data maintenance more efficient.
– Parts inventory planning – Reduce inventory levels and achieve retail service
  levels by providing more precise demand modeling. You can distribute
  inventory optimally within the multi-echelon supply chain to ensure high
  service levels while keeping inventory levels at a minimum.
– Parts supply planning – Reduce inventory in the supply chain by improving
  supplier alignment, increasing automation, and developing accurate supply
  plans. You can also reduce operational cost through efficient purchasing
– Parts distribution planning – Set up stock transfers for parts within a service
  parts network to reduce stock-out situations and operational costs.
– Parts monitoring – Work with suppliers and customers to exchange information
  and handle alerts collaboratively.

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Business Intelligence (BI) and Data warehousing (DW)
• Business intelligence (BI) mainly refers to computer-based
  techniques used in identifying, extracting, and analyzing
  business data, such as sales revenue by products and/or
  departments, or by associated costs and incomes
• BI technologies provide historical, current and predictive views
  of business operations. Common functions of business
  intelligence technologies are reporting, online analytical
  processing, analytics, data mining, process mining, complex
  event processing, business performance management,
  benchmarking, text mining and predictive analytics
• Business intelligence aims to support better business decision-
  making. Thus a BI system can be called a decision support
  system (DSS)

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Data Warehousing
• A data warehouse (DW) is a database used for reporting and
  analysis. The data stored in the warehouse is uploaded from the
  operational systems. The data may pass through an operational
  data store for additional operations before it is used in the DW
  for reporting.
• Data warehouses can be subdivided into data marts. Data marts
  store subsets of data from a warehouse.
• This definition of the data warehouse focuses on data storage.
  The main source of the data is cleaned, transformed, catalogued
  and made available for use by managers and other business
  professionals for data mining, online analytical processing,
  market research and decision support

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   Management Information System

Impact of IT on Management
      Decision Making

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Information Technology impacts the Management Decision
in the following manner
• Reduction in Information Uncertainty
• Improvement in the Quality of Information in terms of
• Productivity
• Profitability
• Stock Market Share
• Share ability of Information among different stakeholders
• Online Decision Making

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•   Cost Effectiveness
•   Information consistency across the various functional
•   Impact Analysis
•   Metrics , facts and data driven decision making assists the
    management in taking prompt and effective decisions

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MIS Reporting using Microsoft

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Microsoft Excel has proved to be a boon for the MIS reporting
on account of the following features provided in the excel
• Pivot Table & Pivot Table Reports
   –   A Pivot Table is a data summarization tool found
   –   pivot-table tools can automatically sort, count, total or give the
       average of the data stored in one table or spreadsheet.
   –   It displays the results in a second table (called a "pivot table")
       showing the summarized data.
   –   Pivot tables are also useful for quickly creating cross tabulations

   An Example of a Pivot table is given in the next

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•   Charts & Graphs
    –   A Pivot Table is a data summarization tool found
    –   Charts and graphs are a great way of representing the data.
    –   Microsoft Excel offers almost every chart type
    –   This makes it easier to draw them
    –   This in turn helps us in understanding the data quickly
    –   This graphical description makes it all the more easier to know the
        trends or patterns and thus help in taking Decisions

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Goal Seek Scenarios
Goal Seek Scenarios are used to answer the following
  –   You had a meeting with your staff, and it has been decided that a
      price change from 25 to 35 is not a good idea. A better idea is to
      sell more items. You still want a profit of 35 000.
  –   Your business has a modest profit of 25,000. You have set yourself
      a new profit Goal of 35,000. At the moment, you are selling 1000
      items at 25 each. Assume that you will still sell 1000 items. The
      question is, to hit your new profit of 35,000, by how much do you
      have to raise your prices?

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  Management Information System

System Analysis & Design

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Need For System Analysis

•   When we are asked to computerize a system, as a
    requirement of the data processing or the information

•   It is necessary to analyze the system from different angles
    or perspectives

•   This requires analysis of the system as the basic necessity
    for an efficient system design.

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The need for analysis stems from the following point of view
   • System Objective
      –   This means what the system is supposed to do i.e. the end
          objective. Eg. An establishment of computerized payroll
          system which will generate MIS reports for day to day
          operational tasks
   • System Boundaries
      –   This means the boundaries of the system i.e. the range ; the
          limit eg. This system will cover HR, Finance & Admin
          processes only.
   • Nature of The System
      –   This means that whether the system is an open system or a
          closed system i.e. whether it will accept input from outside or
          will generate reports from an internal input

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• Role of the System as an Interface
  –   This means that whatever the output that this system will
      generate whether this output will form input to other systems
      or not. Eg. The output of Salary report of an employees
      forming an input to Income tax system
• Understanding of Resource Needs
  –   This means that the resources that are required to run this
      system eg. Hardware, software etc.

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Management Information System


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Do Any one
(Submit your assignment by 22nd Feb, 2012 mail to sanjive.saxena@jimsindia.org)
a. In the current business scenario either in the Indian context or in global context,
    find out where the failure of MIS system has led to catastrophic results to the
    organization. You are required to prepare a detailed report supported by facts and
    clearly highlighting the failure of MIS

b.   Make a list of the systems within an organization and identify their type and the
     various reports that are being used with the possibility of improving the same

c.      Make appropriate and detailed information systems plans for creating a
     Management Information Systems for managing the placement activity of your

d.   Your institute organizes various events in a year. Identify the various MIS reports
     that are required and analyzed these reports for the purpose of decision making so
     that the findings you generate can be implemented in future events of your

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  Management Information System

Systems Analysis & Design
      Process Models

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•   There are many different methods and techniques used to
    direct the life cycle of a Management Information System
    development project

•   Most real-world models are customized adaptations of the
    generic models

•   While each is designed for a specific purpose or reason,
    most have similar goals and share many common tasks

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Typical activities Tasks that are involved in developing a MIS
       •   System conceptualization
       •   System requirements and benefits analysis
       •   System design
       •   Specification of software requirements
       •   Architectural design
       •   Detailed design
       •   Software Development
       •   Software Testing
       •   Installation
       •   Training and documentation
       •   Implementation
       •   Maintenance

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•   System conceptualization – This refers to the conceptualization of the
    system that is thinking of the system what exactly it would be like when
    this system is implemented

•   System requirements and benefits analysis – This means determining the
    requirements of the system that is whether the system is worth while to
    go ahead or not

•   System design – This means designing the system that is how the system
    should be designed so as to deliver as to what is asked for

•   Specification of software requirements – This deals with the requirements
    of the software

•   Architectural design – this is related to the design of the software that the
    technical aspects from the conceptual viewpoint

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•   Detailed design – This means that designing the software to a very
    specific detail

•   Software Development – this means writing the program for the software

•   Software Testing – this means testing the software which has been

•   Installation – this means installing the software on the user machines

•   Training and documentation – this means providing the training to the
    end users

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   Management Information System

Tools for Systems Analysis &

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There are several tools and techniques used for designing.
These tools are :
      • Flowchart
      • Data flow diagram (DFDs)
      • Data dictionary
      • Decision table
      • Decision tree

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 • The pictorial representation of the programs or the
   algorithm is known as flowcharts. It is nothing but a
   diagrammatic representation of the various steps involved
   in designing a system
 • The purpose of using flowcharts is to graphically present
   the logical flow of data in the system and defining major
   phases of processing along with the various media to be
 • A flowchart consists of a set of ‘flowchart symbols’
   connected by arrows. Each symbol contains information
   about what must be done at that point & the arrow shows
   the ‘flow of execution’ of the algorithm i.e. they show the
   order in which the instructions must be executed

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       Management Information System

Symbols used in Flowchart

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Data flow diagram (DFDs)
• Data flow diagrams are the most commonly
  used way of documenting the process of
  current & required systems

• They are a pictorial way of showing the
  flow of data into, around & out of a system

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Difference between Flowchart & DFD
• Unlike, flowcharts, DFDs do not give
  detailed descriptions of modules but
  graphically describe a system’s data and
  how the data interact with the system
• Flowchart represent a process while a
  DFD’s represents the flow of the data
  within the system

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DFD’s are constructed using the four major components
•   External entries: External entities represent the source of data as input to the
    system. They are also the destination of system data. External entities can be
    called data stores out side the system. These are represented by squares.

•   Data stores :Data stores represent stores of data within the system. Examples,
    computer files or databases. An open-ended box represents a data/store – data
    at rest or a temporary repository of data.

•   Processes: Process represents activities in which data is manipulated by being
    stored or retrieved or transferred in some way. In other words we can say that
    process transforms the input data into output data. Circles stand for a process
    that converts data into information.

•   Data flows: Data flows represents the movement of data from one component
    to the other. An arrow identifies data flow – data in motion. It is a pipeline
    through which information flows... Data flows are generally shown as one-way
    only. Data Flows between external entities are shown as dotted lines.

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Data dictionary
• A data dictionary, or metadata repository, is
  a "centralized repository of information
  about data such as meaning, relationships
  to other data, origin, usage, and format
• It is widely used when we are designing
  databases which has large number of
  tables, indexes, records etc.

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Decision Table & Decision trees
• A decision table is a chart with four sections
  listing all the logical conditions and actions
• It is used to solve problems such as
  – If order is from book store And if order is for 6
    copies Then discount is 25% Else (if order is for
    less then 6 copies) No discount is allowed Else (if
    order is from libraries) If order is for 50 copies or
    more Then discount is 15% Else if order is for 20 to
    49 copies Then discount is 10% Else if order is for 6
    to 19 copies Then discount is 5% Else (order is for
    less then 6 copies) No discount is allowed

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From the figure, it is concluded that a decision table
  consists of 4 sections
• Condition Stub & Action Stub
   – The condition stub contains a list of all the necessary
     tests in a decision table. In the lower left-hand corner of
     the decision table we find the action stub where one may
     note all the processes desired in a given module. Thus
     Action Stub contains a list of all the processes involved
     in a decision table
• Condition Entry & Action Entry
   – The Condition entry contains a list of all the yes/no
     permutations in a decision table. The lower right corner holds
     the action entry. X’s or dots indicate whether an action should
     occur as a consequence of the yes/no entries under condition
     entry. X’s indicate action; dots indicate no action

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 Decision tree
 The decision tree defines the conditions as a sequence of left to
right tests. A decision tree helps to show the paths that are possible
in a design following an action or decision by the user

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 Decision tree
 Decision tree turns a decision table into a diagram. This tool is read from
left to right, decision results in a fork, and all branches end with an
outcome. The figure illustrates the decision tree for the book order
decision table.

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Role & Responsibilities of a
      Systems Analyst

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• A system analyst is a person who is
  responsible for the operating system and
  associated subsystems
• He provides system-level support of multi-
  user operating systems, hardware and
  software tools, including installation,
  configuration, maintenance, and support of
  these systems He Identifies alternatives for
  optimizing computer resources
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His responsibilities include

•   Collect information to analyze and evaluate existing or proposed
•   Research, plan, install, configure, troubleshoot, maintain and upgrade
    operating systems.
•   Research, plan, install, configure, troubleshoot, maintain and upgrade
    hardware and software interfaces with the operating system. Analyze
    and evaluate present or proposed business procedures or problems to
    define data processing needs. Prepare detailed flow charts and
    diagrams outlining systems capabilities and processes.
•   Research and recommend hardware and software development,
    purchase, and use. Troubleshoot and resolve hardware, software, and
    connectivity problems, including user access and component

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• Install, configure, and upgrade desktop hardware
  and peripherals to include; network cards, printers,
  modems, mice and add-in boards
• Work as a team member with other technical staff,
  such as networking to ensure connectivity and
  compatibility between systems
• Write and maintain system documentation
• Conduct technical research on system upgrades to
  determine feasibility, cost, time required, and
  compatibility with current system

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Electronic Commerce and

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What is E-Commerce?
• A type of business model, or segment of a larger business
  model, that enables a firm or individual to conduct business
  over an electronic network, typically the internet

•   Electronic commerce operates in all four of the major market
    segments: business to business, business to consumer,
    consumer to consumer and consumer to business

•   E Commerce functionality is to allow for the online purchase of
    goods or services by credit cards or Pay Pal. Buying products
    over the Internet

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Advantages & Disdvantages of

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The following     are        the          advantages   of   E-

  –   Global presence
  –   24/7 opening
  –   Reduced costs
  –   Increased sales and profit
  –   Improved customer information

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The following are the disadvantages of E-
  – Start up costs
  – Issues with access
  – Not suitable for all products
  – Increased competition

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Categories of E-Commerce

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Ecommerce is broken into the following main
            •   B2B
            •   B2C
            •   C2B
            •   C2C

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Ecommerce Categories
•   B2B (Business-to-Business)
     – Companies doing business with each other such as manufacturers selling
       to distributors and wholesalers selling to retailers. Pricing is based on
       quantity of order and is often negotiable

•   B2C (Business-to-Consumer)
     – Businesses selling to the general public typically through catalogs utilizing
       shopping cart software. By dollar volume, B2B takes the prize, however
       B2C is really what the average people has in mind with regards to
       ecommerce as a whole

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• C2B (Consumer-to-Business)
  – A consumer posts his project with a set budget online and
    within hours companies review the consumer's requirements
    and bid on the project. The consumer reviews the bids and
    selects the company that will complete the project. Elance
    empowers consumers around the world by providing the
    meeting ground and platform for such transactions

• C2C (Consumer-to-Consumer)
  – There are many sites offering free classifieds, auctions, and
    forums where individuals can buy and sell thanks to online
    payment systems like PayPal where people can send and
    receive money online with ease. eBay's auction service is a
    great example of where person-to-person transactions take
    place everyday

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Companies using internal networks to offer their
employees products and services online--not necessarily
online on the Web--are engaging in B2E (Business-to-
Employee) ecommerce

G2G (Government-to-Government), G2E (Government-
to-Employee), G2B (Government-to-Business), B2G
(Business-to-Government),       G2C      (Government-to-
Citizen), C2G (Citizen-to-Government) are other forms
of ecommerce that involve transactions with the
government--from procurement to filing taxes to
business registrations to renewing licenses

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  Telecommunications &
networking in Business World

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• Telecommunication simply involves sharing
  information over a distance, which has made
  globalization in business possible
• Networking means forging connections with
  other business people and clients in order to
  maximize your opportunities for growth
• Every business is taking advantage of
  emerging networking opportunities that use
  telecommunication to share its message with
  a broader audience

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Modes of Telecommunication in business
• Telecommunication involves communication via
  email, which is widely used in carrying out
  various business operations
• It involves sharing of information via social-
  networking sites, websites and a blog
• Software-sharing      programs      and    web-
  conferencing programs allow for an instant
  exchange of ideas and business operations
• Online chats are another example, and so are
  phone calls, including those between two parties
  or more than two individuals

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• Determine how telecommunication will most benefit the
   business, rather than haphazardly testing different
• For example, if we believe our products would succeed in
   another country, we should web conferencing to build a
   strategic alliance with a company based in that country
• If we wish to save on overhead costs and don't need our
   employees to work on-site, we should use software that lets
   them collaborate on projects from a distance
• We must also consider using phone conferencing to discuss
   ideas as a team in real time.
• We should also consider hiring a virtual assistant to book
   appointments from a remote location if we don't have a
   full-time assistant.

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• Use telecommunications to improve communication when
  in-person communication is difficult or impossible
• Don't use it to eliminate all interpersonal interaction in the
  name of efficiency
• If our employees work from home, have them meet in the
  office once a week to maintain a sense of team spirit
• Additionally, if we are presenting in a web conference, we
  must remember that it can seem more difficult than an in-
  person presentation
• Not seeing our audience can be daunting, and we probably
  won't have any breaks for questions until the end, so
  practice giving our speech to a computer screen

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• Employees will probably respond positively to technologies that
  allow them to work from home or increase their productivity
• In fact, they tend to become more productive when working
• Evaluate the changing communication systems to ensure they
  function at their best
• Spending money on fancy new technology does not in itself ensure
  strong communication
• The information-technology staff should explain how to use
  communication tools to all staff members, and when web
  conferencing, have a knowledgeable IT staff member on hand
• Introduce new technologies gradually, too, so that the are not

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• Employees will probably respond positively to technologies that
  allow them to work from home or increase their productivity
• In fact, they tend to become more productive when working
• Evaluate the changing communication systems to ensure they
  function at their best
• Spending money on fancy new technology does not in itself ensure
  strong communication
• The information-technology staff should explain how to use
  communication tools to all staff members, and when web
  conferencing, have a knowledgeable IT staff member on hand
• Introduce new technologies gradually, too, so that the are not

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Wireless Computer Networks and
          Internet Access

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The Wireless Revolution
• Mobile phones have become mobile platforms for
  delivering digital data, used for recording and downloading
  photos, video and music, Internet access, and transmitting

• An array of technologies provides high-speed wireless
  access to the Internet for PCs and other wireless handheld
  devices and cell phones

• Businesses increasingly use wireless to cut costs, increase
  flexibility, and create new products and services

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Business Value of Wireless Networking
• Wireless communication helps businesses
  easily stay in touch with customers, suppliers,
  and employees

• Wireless networking increases worker
  productivity and output, as workers take less
  time to establish contact with people and to
  access information
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• Companies can save on wiring offices,
  moving, and making network changes by
  using wireless networks

• Wireless technology has also been the
  source of new products, services, and
  sales channels in a variety of industries,
  e.g. OnStar, Starbucks “hot spots”

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Devices for Wireless Transmission
• Paging systems

• E-mail handhelds

• Cellular telephones

• Personal Digital Assistants (PDAs)

• Smart phones

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• M-commerce: The use of the Internet for
  purchasing goods and services and also for
  transmitting messages using wireless mobile devices

• Mobile computing: Enables internet-enabled cell
  phones, PDAs, and other wireless computing devices
  to access digital information on the Internet from
  any location

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M-Commerce Services and Applications
• Information-based services: Instant messaging, e-mail,
  searching for a movie or restaurant using a cell phone or
  handheld PDA

• Transaction-based services: Purchasing stocks, concert tickets,
  music, or games; searching for the best price for an item using a
  cell phone and buying it in a physical store or on the Web

• Personalized services: Services that anticipate what a customer
  wants based on that person’s location or data profile, such as
  updated airline flight information or beaming coupons for
  nearby restaurants

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Accessing Information from the Wireless Web

• Wireless portals: Content and services optimized for
  smaller screens of mobile devices to steer users to
  the information they are most likely to need

• Voice portals: Accept voice commands for accessing
  Web content, e-mail, and other electronic
  applications from a cell phone or standard telephone

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Digital Payment Systems and M-Commerce

• Micropayment system
  o Individual service providers run their own separate
    payment systems
  o Small payments added on to single bill

• Stored payment system
   o Cell phone equipped with smart card storing
     rechargeable electronic cash

• Mobile Wallets (m-Wallets): Store personal data to use in
  online transactions

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M-Commerce Challenges
• Slow data transfer speeds on second-generation
  cellular networks, resulting in higher costs to
• Limited memory and power supplies
• More Web sites need to be designed specifically for
  small wireless devices.
• Keyboards and screens on cell phones are still tiny
  and awkward to use.

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Wireless Applications

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Wireless Customer Relationship Management

Wireless CRM enables sales and field service
professionals to:
Access customer account records and information at
any time or location
• Update customer accounts and deal information to
  update customer database instantaneously
• Receive      alerts    to     important      events
  Enter, perform, and update transactions and product

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Wireless Supply Chain Management (SCM) and Radio
Frequency Identification (RFID)

• Wireless supply chain management systems: Provide
  simultaneous accurate information about demand,
  supply, production, and logistics as goods move
  among supply chain partners

• Radio Frequency Identification (RFID) systems:
  Provide a powerful technology for tracking the
  movement of goods throughout the supply chain

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Wireless in Health Care

• Electronic Medical Record (EMR) retrieval

• Wireless note taking for patient charts

• Lab test results

• Prescription generation

• Medical databases

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Management Opportunities:
Wireless technology offers:
• Flexible business processes
• Business processes not limited by time or space
• New channel for communicating with client
• Source of new products and services

Management Challenges
• Integrating wireless technology into the firm’s IT
• Maintaining security and privacy

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Solution Guidelines
The following are some of the guidelines for managing
mobile technology in the enterprise

•   Identifying areas in which wireless can provide value

•   Creating a management framework for wireless

•   Using a pilot program before full-scale rollout of
    wireless systems

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Quality in Information

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Concept of Quality

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Some Concepts of Quality
 Quality, It's a Way of Life
 Quality Is Our Most Important Product
 Quality is a degree of excellence... (Webster)
 A function of continuous improvement              based on
   reduction in variation around the desired output (Deming)
• Quality is fitness for use. (Juran, 1974)
• Quality means conformance to requirements (Crosby,
• [Quality is] a system of means to economically produce
  goods or services which satisfy customers'
  requirements (Japanese Industrial Standards Committee,

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Why so many definitions of Quality?

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Quality is based on many Perspectives

         »Judge-mental criteria
         »Product based criteria
         »User based criteria
         »Value based criteria
         »Manufacturing based criteria

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    Benefit of Quality

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Quality has the following benefits
 •Project productivity is higher
    –Because of reduced rework
  •Costs of the project's product is lower
    –With reduced rework
  •The cost of product-in-use is lower
    –Due to lower maintenance costs
    –And higher in-use productivity
  •Hence, customer satisfaction is increased

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•   Increased Efficiency
•   Increased Revenue
•   Employee Morale
•   International Recognition
•   Factual Approach to Decision Making
•   Supplier Relationships
•   Documentation
•   Consistency
•   Customer Satisfaction
•   Improvement Processes

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Quality Assurance Process

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• Quality assurance (QA) refers to the planned
  and systematic activities implemented in a
  quality system so that quality requirements
  for a product or service are fulfilled
• It is the systematic measurement,
  comparison with a standard, monitoring of
  processes and an associated feedback loop
  that confers error prevention

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In order to implement quality assurance in a organization, we need to address
the following issues
The basic Documentation Requirements
     •    Management Commitment
     •    Management Responsibility
     •    Customer Focus
     •    Quality Policy
     •    Responsibility and Authority
     •    Communication
     •    Management Reviews
     •    Resource Management
     •    Design and Development Process
     •    Customer Related Process
Etc. etc….
AND The Related QA Process

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Quality Management Standards

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ISO Standard

  •   International Organization for Standardization.
  •   This is a worldwide federation of national standards
      bodies from some 100 countries, one from each
  •   ISO is a non-governmental organization established in
  •   The mission of ISO is to promote the development of
      standardization and related activities in the world .
  •   ISO's work results in international agreements which
      are published as International Standards.

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Advantages of ISO Standard
  – The process analyses that go along with ISO
     certification results in streamlining processes and
     more efficient use of resources and raw materials
     and subsequently reduce the company's costs.
  – Helps in reducing the amount of raw materials
     and utilities used.
  – Improved employee morale may result when
     employees feel that the workplace is safer and they
     are contributing to the environmental effort
  – The ISO certification establishes a unique identity
     across the globe
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Six Sigma

     • International Originated at Motorola in
       the early 80’s
     • Is a methodology for disciplined quality
     • Doesn’t use “Quality” in the name only
     • Focus on Juran’s observation and saying
       “All quality improvement occurs on a
       project-by-project basis and in no other
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Advantages of Six Sigma

   – With the inclusion of Six Sigma into a sound business
     system, the major ingredients of a Total Quality
     Management System are usually in place
   – Six Sigma’s goal is the near elimination of defects from
     any process, product, or service.
   – The numerical goal is 3.467 defects per million
     opportunities. Quality Guru, Juran, once concluded
     that in the US, close to 1/3 of the work done consisted
     of redoing what had already been done.
   – Depending on the industry, this Cost of Poor Quality
     (COPQ) could be 20 to 40% of total effort!
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 • The Capability Maturity Model (CMM) is a model
   developed by Carnegie Mellon University
 • It is a development model that was created after
   study of data collected from organizations that
   developed the software for U.S. Department of
 • The term "maturity" relates to the degree of
   formality and optimization of processes, from ad
   hoc practices, to formally defined steps, to managed
   result metrics, to active optimization of the

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Benefits of SEI- CMM
  – When the CMM is applied to an existing
      organization's software-development processes, it
      allows an effective approach toward improving
  – It reduced the rework and bug fixing efforts in the
      software development process.
  – On account of this it was eventually clear that the
      model could be applied to other processes
  – This gave rise to a more general concept that is
      applied to business

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        Case Study

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Read the Case and answer the questions that follow:

Multi Pak Company Limited is a diversified business group
with interests in fabric and yarn manufacturing, paper and
pulp, and cement. Its manufacturing units are located across
the country and number eight- one for fabric, two for yarn,
two for paper and pulp, and three for cement. While the head
of each unit has considerable operational autonomy, strategic
decisions considering these units, such as capacity expansion,
procurement of new technology involving substantial
investment, etc., are made at the headquarters, located in
Delhi. The head quarters monitor the performance of every
unit though weekly and monthly reports are which are
prepared by CBIS installed at each unit. Contd……-

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Often considerable amount of time of the senior executives
based at the headquarters is taken away in analyzing these
reports and drawing inferences for planning and control. The
result is that the senior executives have little time for strategic
thinking which they feel is a must in the present competitive
environment. The CEO of the company has thus proposed to
develop suitable computer based systems which might be
helpful in understanding the current status of various
manufacturing units in terms of their overall performance, the
type of environmental constraints that operate in the three
business that exist for enhancing capacity in these business
Now Answer the questions that follow:

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a. What systems would you propose that would
  serve the company’s needs?

b. Considering that the company already has CBIS
  installed, will you contemplate complete overhaul
  of the systems or add functionalities of the
  existing systems? Justify your line of action.

c. Justify the requirement of a Chief Information
  Officer (CIO) in the context of the given case let.
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