Concept of Management Information Systems Chapter 2 Introduction 1 2 3 4 5 6 • Differentiate between data and information • Understand information as a resource • Understand the role of information in organisational functions • An overview of types of MIS • Understand decision-making with MIS • Understand communication within organisations CASE STUDY - IS IN INDIAN RAILWAYS • PASSENGER RESERVATION SYSTEM – 1980’s • PASSENGER RESERVATION SYSTEM INTERNET • CREW MANAGEMENT SYSTEM • INTEGRATED COACHING MANAGEMENT SYSTEM https://www.youtube.com/watch?v=XMWIfJlyOmw https://www.youtube.com/watch?v=_5GUafrcTcM 3 Data and Information Data is entered here. Raw Facts are data Processed data is Information 4 Measuring Data BITS = Binary Digits 0, 1 5 Information As a Resource • In modern organisations, information, data and information systems are used extensively within and across organisational functions, across hierarchies. • Typical functions in an organisation include accounting and finance, marketing, operations, human resource management and information systems management. Types of Information Technology • Historically, information systems were designed for specific functions within organisations • Modern information systems are designed largely to support individuals, groups or enterprise functions • Functional IT is used by individuals for their own work, Network IT is used within functions to collaborate/ communicate within the group. Enterprise IT is designed for processes in the organisation and is very efficient in moving data between different functions and to communicate with outside partners 7 Types of Information Technology • Diagram – Components of modern information technology infrastructure in an organisation 8 Types of Information Systems: Transaction Processing system • Transaction processing systems record all transactions as they happen, storing transaction data and preserving a digital record of the functioning of the enterprise. • They are designed to respond quickly to the user, through carefully designed interfaces that guide users through various transactions. 9 Types of Information Systems: Management Information Systems • MIS process data generated by Transaction processing systems, by aggregating data into reports to be used by the management, to sense and monitor the organisation. • Real-time monitoring involves presenting data as soon as it is created • Batch mode monitoring aggregates data over a period of time, allowing drilling down to details • Specific reports are tailored for specific decisions and hence the need for MIS to be designed to meet the specific requirements of managers 10 MIS at different levels • Needs of managers at different levels are different • Executives at the highest level require aggregated data – Executive Support Systems (ESS) provide such reports which use graphs, charts and diagrams • Managers who report to Executives use Decision Support Systems which use scientific models of decision making on available data • Knowledge workers use sophisticated models to analyse transaction data and data related to the industry and economy 11 A Screenshot of an ESS (simulated) 12 Decision making with MIS: Tactical Decisions • Tactical decisions are those that have short-term impact and are taken by workers and operators • Examples: Nurse attending to a patient in a hospital ward 13 Decision making with MIS: Tactical Decisions • Tactical decisions are those that have short-term impact and are taken by workers and operators • Examples: Shop Floor Assembly Line worker 14 Decision making with MIS: Operational Decisions • Decisions that have a medium-term scope and are made by managers are Operational decisions • These are based on aggregate data and are often supported by decision support systems • Examples: (Operations Manager, Mktg Manager, Finance Manager, Software Project Manager) • Control and planning are important activities involving operational decisions 15 Decision making with MIS: Operational Decisions • Decisions that have a medium-term scope and are made by managers are Operational decisions • These are based on aggregate data and are often supported by decision support systems • Examples: (Operations Manager, Mktg Manager, Finance Manager, Software Project Manager) • Control and planning are important activities involving operational decisions 16 Travelling Salesman problem This is an example of an operational decision. 17 Strategic Decisions • Decisions that are related to the vision & mission of the organisations with a very long-term horizon in perspective. • ESS is an example of a Strategic decision making tool. – Pharma: Which markets to enter? (ESS→Industry data on competition) – Govt (Indian Railways): How to plan for future capacity? (Long-term infrastructure growth + Planning for future demand for services) 18 Control & Planning Control implies monitoring of activities against given or stated objectives Planning involves forecasting situations in the future & arranging for activities that will address them • Setting up of marketing incentive schemes to help boost slack in sales • Redeploy sales personnel is specific regions • Send personnel for training programs 19 Communication in organisations • Communications occur through various forms within an organisation – text messages, emails, documents and files • As organisations grow their need for communication grows • Communication is critical for transactions, decision making and strategic collaborations. 20 Types of Communication Digital networks allow - • Synchronous communication – two or more parties communicate at the same time. (e.g. Phone conversations) • Asynchronous communication – two or more parties communicate but not simultaneously (e.g. Email exchange, chat messages, etc) • Simplex communication – possible only in one direction between two parties (e.g. Radio receivers) • Half-duplex communication – two parties can communicate with each other, but not at the same time. (Email communication) • Duplex communication – Two parties communicate with each other at the same time (Phone networks are duplex in nature) 21 Examples of Communication in Organisations • Sales • Service • Tracking • Communication 'on the go’. The Internet presents many security challenges 22 Decision making with Communication Technology • Communications in organisations are from people to people, device to device and devices to people. • Such high levels of connectivity leads to information overload and organisations face the challenge of minimising this to present only relevant information • RFID in Banking → 23 Questions ! Fill in the blanks 1. ESS stands for __________________________ True or False 1. When two or more parties communicate at the same time, it is referred to as Synchronous communication. 2. Nurse attending to a patient in a hospital ward is an example of Strategic decision. Select the right option 1. Travelling salesman problem is an example of _________________ decision a) Strategic b) Operational c) Both a and b d) only b Answers 1. Executive Support Systems 2. True 3. False 4. D
