Management Information System Argumentative
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The scope and purpose of MIS is better understood if each part of the term is defined. Thus,
Management:-It has been defined in a variety of ways, but for our purposes it comprises the processes of activities that describe what managers do in their organization, plan, organize, initiate, and control operations. They plan by setting strategies and goals and selecting the best course of action to achieve the plan. They organize the tasks necessary for the operational plan, set these tasks up into homogeneous groups, and assign authority delegation. They control the performance of the work by setting performance standards and avoiding deviations from the standards.
Because decision making is such a fundamental prerequisite to each of the foregoing processes, the job of an MIS becomes that of facilitating decisions necessary for planning, organizing, and controlling the work and functions of the business.
Information:-Data must be distinguished from information, and this distinction is clear and important for our purposes. Data are facts and figures that are not currently being used in a decision process and usually take the form of historical records that are recorded and filed without immediate intent to retrieve for decision making.
Information consists of data that have been retrieved, processed, or otherwise used for informative or inference purposes, argument, or as a basis for forecasting or decision making.
Systems: – A system can be described simply as a set of elements joined together for a common objective. A subsystem is part of a larger system with which we are concerned. All systems are parts of larger systems. For our purposes the organization is the system and the parts (divisions, departments, functions, units, etc.) are the subsystems.
WHAT IS AN INFORMATION SYSTEM
An information system can be any organized combination of people, hardware, software, communications networks, and data resources that collects, transforms, and disseminates information in an organization.
Hardware: People have relied of information systems to communicate with each other using a variety of physical devices
Software: information processing instructions and procedures
Networks: Communications channels
Data resources: stored data
Business professionals rely on many types of information systems that use a variety of information technologies. For example, some information systems use simple manual (paper and pencil) hardware devices and informal (word of mouth) communications channels. However, in this text, we well concentrate on computer based information systems that use computer hardware and software, the internet and other telecommunications networks, computer-based data resource management techniques, and many other computer-based information technologies to transform data resources into an endless variety of information products for consumers and business professionals.
INFORMATION SYSTEM FRAMEWORK FOR BUSINESS PROFESSIONALS
The field of information systems encompasses many complex technologies, abstract behavioral concepts, and specialized applications in countless business and non business areas. As a manager or business professional you do not have to absorb all of this knowledge.
•Foundation concepts: fundamental behavioral, technical, business, and managerial concepts about the components and roles of information systems.
•Information technologies: major concepts, developments, and management issues in information technology- that is, hardware, software, networks, data resource management, and many internet-based technologies. •Business applications: the major uses of information systems for the operations, management, and competitive advantage of a business, including electronic business, commerce, collaboration and decision making using the internet, intranets, and extranets. •Development processes: how business professionals and information specialists plan, develop and implement information systems to meet business opportunities using several application development approaches. •Management challenges: the challenges of effectively and ethically managing information technologies, strategies and security at the end user, enterprise and global levels of a business.
THE FUNDAMENTAL ROLES OF I S APPLICATIONS IN BUSINESS
•Support business processes: As a consumer, you have to deal regularly with the information systems that support the business processes and operations at the many retail stores where you shop. For example, most retail stores now use computer-based information systems to help them record customer purchases, keep track of inventory, pay employees, buy new merchandise, and evaluate sales trends. Store operations would grind to a halt without the support of such information systems •Support decision making: Information systems also help store managers and other business professionals make better decisions and attempt to gain a competitive advantage. For example, decisions on what lines of merchandise need to be added or discontinued, or on what kind of investment they require, are typically made after an analysis provided by computer-based information systems.
This not only supports the decision making of store managers, buyers and others, but also helps them look for ways to gain an advantage over other retailers in the competition ofr customers. •Support competitive advantage: Gaining a strategic advantage over competitors requires innovative use of information technology. For example, store management might make a decision to install touch-screen kiosks in all of their stores, with links to their e-commerce website for online shopping. This might attract new customers and build customer loyalty because of the ease of shopping and buying merchandise provided by such information systems. Thus, strategic information systems can help provide products and services that give a business a comparative advantage over its competitors.
WHAT IS A SYSTEM
System is a group of interrelated components working together toward a common goal by accepting inputs and producing outputs in an organized transformation process.
Components or functions
Such a system has three basic interacting components or functions
•Input: It involves capturing and assembling elements that enter the system to be processed. For example, raw materials, energy, data and human effort must be secured and organized for processing. •Processing: It involves transformation processes that convert input into output. Examples are a manufacturing process, the human breathing process, or mathematical calculations. •Output: It involves transferring elements that have been produced by a transformation process to their ultimate destination. For example, finished products, human services, and management information must be transmitted to their human users.
Concept of system:
The system concept becomes even more useful by including two additional components: feedback and control. A System with feedback and control components is sometimes called a Cybernetic system that is a self-monitoring, self-regulating system. •Feedback: It is data about the performance of a system. For example, data about sales performance is feedback to a sales manager. •Control: It involves monitoring and evaluating feedback to determine whether a system is moving toward the achievement of its goal. The control function them makes necessary adjustments to a systems input and processing components to ensure that it produces proper output. For example, a sales manager exercises contro when reassigning salespersons to new sales territories after evaluating feedback about their sales performance.
SIX MAJOR TYPES OF SYSTEMS
OPERATION SUPPORT SYSTEMS MANAGEMENTSUPPORT SYSTEMS
Transaction processing system Management information system Process control system Decision support system Enterprise collaboration system Executive information system
Operation Support Systems
TRANSACTION PROCESSING SYSTEM (TPS)
TPS are the basic business system that serve the operational level of the organization. A transaction processing system is a computerized system that performs and records the daily transactions necessary to conduct the business. Examples are sales order entry, hotel reservation system, payroll and shipping.TPS supplies data to the company’s general ledger system, which is responsible for maintaining records of the firm. PROCESS CONTROL SYSTEM:
Process control systems monitor and control physical processes. for example , a petroleum refinery uses electronic sensors linked to computers to continually monitor the chemical processes and make instant adjustments that control the refinery process.
ENTERPRISE COLLOBORATION SYSTEMS: (ECS)
ECS enhances team and work group communications and productivity and are sometimes called as office automation systems .
Management support systems
MANAGEMENT INFORMATION SYSTEM (MIS)
MIS serve the management level of organization, providing managers with reports and, in some cases, with online access to the organization’s current performance and historical records. MIS primarily serve the functions of planning, controlling, and decision making at the management level. Generally they depend on underlying transaction processing systems for their data.
DECISION SUPPORT SYSTEMS (DSS)
DSS help managers make decisions that are unique, rapidly changing, and not easily specified in advance. They address problems where the procedures for arriving at a solution may not be fully pre defined in advance. Although DSS use internal information from TPS and MIS, they often bring in information from external sources, such as current stock prices or product prices of competitors. In short DSS is the information system a organization’s management level that combine data and sophisticated analytical models or data analysis tools to support semi structured and unstructured decision making.
EXECUTIVE SUPPORT SYSTEM (ESS)
ESS serve the strategic level of the organization. They address non routine decisions requiring judgment, evaluation, and insight because there is no agreed on procedure for arriving at a solution. ESS create a generalized computing and communications environment rather than providing any fixed application or specific capability. They filter, compress, and track critical data, emphasizing the reduction of time and effort required to obtain information useful to executives. ESS is the information system at the organization strategic level designed to address unstructured decision making through advanced communication and graphics.
Structure of MIS
COMPONENTS OF MIS
The components of MIS are as follows
PEOPLE: people are required for the operation of all information systems. these people include end users and IS specialists. end users are people who use an information system or the information it produces. IS specialists are those who develop and operate information systems. HARD WARE: the concept of hard ware includes all physical devices and materials used in information processing. SOFT WARE: it includes all sets of information processing instructions. Examples are system software, application software, procedures. DATA: data are more than the raw materials of information systems. Data can take many forms like traditional alpha numeric data, composed of numbers and alphabets. the data resources of IS are typically organized, stored, and accessed by variety of data resource management. NET WORK: net work consists of computers , communication processors, and other devices inter connected by communications media and controlled by communications software.
Scope of Information System in an Organisation
1.Meeting global challenges
The fast growth in international trade and the emergence of a global economy call for information systems that can support both producing and selling goods in many different countries.
The fundamental changes in the organization behaviour, develop new business models, and eliminate the inefficiencies of outmoded organizational structures which increase the quality.
3.Linking department whose functions are different
Information technologies such as internet, intranets and extranets enable the development of inter organisational information systems and network organizational structures.
4.Capturing Opportunities in Market
The use of information technology to design, produce , deliver, and maintain new products according to trends. 5.Enhancing Productivity of Labour.
6.Supporting Corporate Stratergy
Need of Information in Business Management
Data and Information
Data (collection of raw facts) are generally in the form of names, roll nos, times, dates, images, etc. Informtion are data which have been converted or organized into a more useful or meaningful form for direct utilization of mankind. This information helps in decision making process
Information in an Organisation can be in any one of the forms – 1.As Document
4. As Queries
5.As Storage Records
Need for Information in Decision making
1.Define the problem
2.Analysing the problem
3.Develop alternate solutions
4.Select the best solution
5.Convert the decision in to an effective action
People resources include end users like Kepler’s customers, employees, business partners , and owner Clark Kepler, and the IS specialists they must hire and contract with to develop and maintain their computer network and website.
Data resources would include files and database of data about their customers, products, sales, and inventory and other business information.
Clark Kepler’s Information System Resources
•A Field is a grouping of characters that represent a characteristic of a person, place, thing or event. For example , an employee’s name field. •A Record is a collection of interrelated fields. For example, an employee’s payroll record might consist of a name field, a social security number field, a department field, and a salary field. •A File is a collection of interrelated records. For example, a payroll file might consist of the payroll records of all employees of a firm. •A Database is an integrated collection of interrelated records or files .for example, the personnel database of a business might contain payroll, performance review, and career development files.
Fundamental Roles of IS Applications in Business
•Support of its business process and operations.
•Support of decision making by its employees and managers. •Support of its strategies for competitive advantage.
System Application in the Organisation
kinds of ISGroups served
Strategic level long term goals Senior manager And planning
Management level Monitoring, controlling, And administrative activities Middle managers
Of middle managers
Knowledge level Knowledge into business,Knowledge and
Work station and office systemsdata workers
Eg, sales, receipts, cash deposit, payrollOperational
Credit information and flow of materials managers
Operation level In a factory.
Operation level –
The recent information technology and information systems can be managed by functional and process based organizational structures and managerial techniques commonly used throughout other business units.
Information system that supports knowledge and data workers in an organization.
IS that supports the monitoring, controlling, decision making and administrative activities of middle managers.
Strategic level system-
The recent information technology should contribute to a firm’s strategic objectives and competitive advantages, not just for operational efficiency or decision support.
Characteristic of MIS-
1.MIS is management oriented
-Takes care of managers who meet the information requirement. -Keeps in view the overall objectives of the managers
2.MIS is management directed
It deeply involved in the design, implementation and maintenance of the system.
The integrated system as five Ms- Men, Money, Material, Machines and Methods.
4.Avoids redundancy in data storage
It avoids unnecessary duplication and redundancy in data gathering and storage.
5.common data flow
Objectives of integration and to avoid duplication and redundancy in data gathering, storage and retrieval .
6.Heavy planning element
Acquistion and deployment of hardware, software, data processing operation, information presentation and feedback.
It gives provision for breaky into various subsystems based on the activity as well as the functions of the organization, so that effective implementation of each subsystem in possible at a time.
8.Common data base
The data requirements for different levels of management also supports the need of more than one database, unique databases and common database.
9.Flexebility and ease of use
The system is easy to operate so that not much computer skills are required on the part of the user to access database for information on for carrying out special analysis of data.
It provides speed in creating and accessing files, accuracy, consistency in data processing, reduction in clerical work, avoid human error, etc.
It expresses a fundamental conceptual framework for the major components and activities of information system. A business model is a method of doing business by which a company can sustain itself to generate revenue. The business model spells out how a company makes money by specifying where it is positioned in the value chain
E-Commerce as a business model
Buying and selling through internet is known as e-commerce. A company’s business model is the way in which it conducts business in order to generate revenue. There are four segments of e-commerce business models available in the market. They are –
B2B Business to Business – It should be web based exchanges B2C Business to Consumer – Retailing activity of the web C2B Consumer to Business – Consumer bidding
C2C Consumer to Consumer – Consumer auctions
B2CSells products or services directly to consumerwww. Amazon.com rediff. Com
B2BSells products or services to other business people or bring multiple buyers or sellers together in a central market placetradegain.com matexnet.com
C2CConsumers sells directly to other consumersBazee.com
C2BConsumers fix prices on their own which business people accept or declinePriceline.com Razorfinish.com
e-business modelFunctionsBenefits for the company or products E –shopTo mark a business. This method often combined with transaction methodsIncrease in demand low cost route to regional and global trade. Bazaar.e.com e-procurementElectronic tendering and procurement of goods and servicesWide choice for the suppliers lower cost, better quality, improved delivery time savings and convenience. Maatexnet.com e-mallsE supermarket ( collection of e shops) To email members in terms of lower cost, brand equity and cost savingBababazar.com e- virtualCustomer adding information to a business environmentBuilding customer loyalty by receiving customer feedback. India-apparel.com, electricmela.com
Information System Architecture
It refers to how information is organized within a system. It is concerned with the Organisation information requirement and the way in which the requirement are met. Information architecture helps the Organization to meet its strategy business need if properly build. The basic architecture of the organization will influence the kind of system that are developed and the linkages develops with other Organisation.
Classification of Information system Architecture
Old ArchitectureNew Architecture
Distributed NetworkClient server architecture
PC’s and workstationE-commerce application
LANInternet or web base application
Mid range Architecture
Main frame architecture
Evolution of Information System
3rd millennium BC Sumerian people, used clay tablets for recording data Changes made during industrial revolution
Now, in an Organisation information system is regarded as separate department. 1. Manual Information system
2Computer based information system Manual Information System –
Is the oldest method
People receive data by viewing or hearing them. These data are stored in the minds of individual which also act as a control and logic unit. The output may be written or oral
Here human minds can perform many operations on data – coding, subtracting, multiplying and dividing.
Computer based information system
It uses computer hardware and software to perform its operations – information processing system – people, programs, procedures, data, computers. 1.Computers can serve several roles in the production of information data storage and retrival device. – data librarian
can provide processing capabilities for the production of Information 3.Computer can serve as a communicational device to obtain data or information from other computers 4.The computer can present information by producing tables, reports, charts, graphs, formatted documents.
1990’s – 2000 e business & commerce – Internet based e business & e commerce system Internet worked enterprises and global e-business operations 1980’s – 1990’s – Strategy and Enterprise application. End user computing systems EIS, Executive information system, Strategic Information System 1970’s – 1980’s – Decision support. Interactive Adhoc support of the managerial decision making process 1960’s – 1970 – Management reporting (MIS introduced) Mgt reports of 3 specified information to support decision making 1950 -1960’s – Data processing – Electronic data processing system, Transaction processing system, Record keeping, Traditional accounting applications.
Until 1960’s the role of most information system are simple. The various systems such as transaction processing, Record keeping, tradition accounting application, Electronic data processing application. Another role was added as the concept of MIS was conceived.
During 1970’s information products produced by MIS were not adequately meeting many of the decision making needs of the management. Hence the concept of DSS were introduced.
In 1980’s several new roles for information system appeared many number of top corporate executives did not directly use the reports of MIS or the analytical capability of DSS. So the concept of executive information system (EIS) was developed. Due to the rapid development of micro computer processing, software packages and telecommunications network which gave birth to the phenomenon of end user. Apart from EIS there is a great break through in the development and application of Artificial Intelligence to Business information systems, the areas such as expert system, rural networks, robotics and other knowledge base system forge a new role for information system.
By 1990’s the concept of strategic role for information system caused Strategic information system was developed. It becomes an integral component of business processes that help a company to gain competitive advantage in a global market.
Finally a rapid growth of internet, intranet (information only within the Organisation) and extranet (it covers external environment in boundary) and other inter connected global networks has dramatically changed the capabilities of information system in business. Global electronic business and commerce system and revolutionalising the operation and management of todays business enterprise.
2.What are the contemporary approaches of MIS
3.What are the components in MIS
4.Differentiate Data and information
5.Differentiate between manual based information and CBIS
7.What do you mean by hardware and software
8.What is a business model
9.Distinguish between B2C and B2B electronic commerce
10.What do you mean by electronic shopping
1.Explain the evolution of MIS
2.Explain the impact of IT in redefining modern business
3.Explain the different types of information system
4.What are E-business model? What are the advantages of using the Internet as the infrastructure for electronic commerce.
5.Explain MIS framework
6.Explain the components of MIS
7.Explain the scope, characteristic and IS resources