MIS - Mr. Sushant Sharma

8/10/2019 MIS - Mr. Sushant Sharma

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ManagementInformation

Systems

| Faculty | Sushant Sharma |SUSHANT SHARMA


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MIS: A Definition:

An MIS is

An integrated (computer-based) user-

machine system

For providing information

To support decision-making functions

In an organization

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Understanding System

&Environment

Data &Information Technical

&Business dimensions

Components of Computer based

Information systems

Business applications of

various Information Systems

Functional Information Systems

Models of File Organization

Data structures Models

Understanding SystemDevelopment Life Cycle

Benefits of Increased capabilities

of IT

1

2

3

4

5

6

7

8

9

Learning Goals

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What is Management Information System?

Subset of the overall internal control procedures, in a business,

which covers the application of people, documents,

technologies and procedures used by management

accountants to solve business problems such as costing a

product, service or a business wide strategy.

Distinct from regular information systems - analyze other

information systems applied in operational activities in the

organization.

The system utilizes:

Computer hardware and software

Manual procedures

Models for decision-making, and

A database

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Systems

A SYSTEM is a set of interrelated and

interdependent elements such as people, resources,

concepts, and procedures intended to perform an

identifiable function or to serve a goal.

System Levels (Hierarchy): All systems are

subsystems interconnected through interfaces

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The Structure of a System

Three Dist inct Parts of Systems Inputs

Processes

Outputs

Systems Are surrounded by an environment

Frequently include a feedback mechanism

A human, the decision maker, is usuallyconsidered part of the system

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Business System

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Closed and Open Systems

A Closed System is total ly independent of other systems andsubsystems: Do not interact, or exchange any inputs or outputswith its environment

An Open System is very dependent on its environment

:Interacts with its environment, exchanges inputs and outputs

a continuum

Defining manageable boundaries isclosing thesystem

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Six stages of processing

Input: Data capturing - collecting and entering the data into the

information system.

Data Processing: here the data is manipulated into

information using mathematical, statistical and other tools.

Output: the information is displayed or presented.

Storage: data and information are maintained for later use.

Retrieval

Dissemination of MI finished product of MIS

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Information

Processed data, presented in a form which assistsdecision-makers

May contain an element of surprise, reduceuncertainty

May provoke a manager to initiate action

Data and Info relative concepts Recency

Producer-consumer relationship

Often used interchangeably

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Characteristics of useful information-

Technical Dimensions

Response Time : Time lapse between the time when query is made and

the time when the results are actually produced . Least response time

preferred . Achieved through capabilities of hardware &software.

Relevant: the information must be pertaining to the problem at hand.

Capacity Condensed and precise reports in the form of analysis of trend

instead of tabular formats.

Complete: partial information is often worse than no information.

Accurate: erroneous information might lead to disastrous decisions.

Recency /Current/Validity : decisions should be based on the latest

information available, because what was a fact yesterday might no longer

be one today. Economical: in business setting ,the cost of obtaining information must be

considered as one cost element involved in any decision.

Security : Users security and privacy of data to be ensured

Interrelations of data elements Sharing of data across the organizationsSUSHANT SHARMA


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Characteristics of useful information-

Business DimensionsStructuredness: The information is structured if it can be discretely defined, forexample, the daily invoice is structured information as it clearly states the need.

However, information of high-income group people is unstructured as it does not

clearly state the income limit of the high income group.

Programmability: It is the ease with which the process of performing a task can

be defined. The approval of a supplier on the basis of the lowest quote is a

decision which can be explained to anyone; thus, it is programmable. However, adecision to approve tenders on the basis of product quality is a vague thing to

explain and can not be easily programmed.

External Scope: Information is external if it belongs to the environment outside

the system boundaries e.g., the data about sales of a competitor gives external

information, whereas the data about the sales of our department generates

internal information.

Time Scope: Information may deal with the future or the past of the company.

Accordingly, it is termed as futuristic or historical. The financial projections for the

next quarter refer to futuristic data whereas the profits and loss statement for the

financial year present historical data.SUSHANT SHARMA


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IS a set of interrelated components working

together to collect, retrieve, process, store, and

distribute information for the purpose of facil itat ing

planning, control, coordination, analysis, and

decision making in business organizations Input-process-output perspective-Accepts inputs

and processes data to provide information to

decision makers and helps decision makers

communicate their results

People-organization-technology perspective Is often at the heart of many organizations

What is IS?

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Technology the means by which data is transformed and organized for business use:

HardwareSoftware

DatabaseTelecommunication

People the users of IS

Organization -- a collection of functional units working together to achieve a common goal

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Computer software, is the collection of computer programs and related data that provide

the instructions telling a computer what to do and how to do it

Computer hardware refers to the physical parts of a computer and related devices.

Internal hardware parts of a computer are often referred to as components. External

hardware devices are usually called peripherals

TELECOMMUNICATIONS-Science and technology associated, in general, withcommunications at a distance. A telecommunications system requires a analogy or digital

transmitter, a compatible receiver, and a physical (cable or wire) or non-physical

(wireless) connection

People -Information systems professionals who analyze organizational information

needs, design and build information systems, prepare computer programs

Procedures refers to rules for achieving optimal and secure operations in dataprocessing

Data refers to representation of facts, concepts, or instructions in a formalized manner

suitable for communication, interpretation, or processing by humans or by automatic

means

MAIN COMPONENTS OF INFORMATION SYSTEMS

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Management

Information

System

-Types

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This could be acall out area.

1. TRANSACTION PROCESSING SYSTEM1. TRANSACTION PROCESSING SYSTEM

Purpose Updating the appropriate database records as soon as a transaction(order, payment, etc.) is entered into the computer. It may also imply

that confirmations are sent at the same time.

Backbone of anorganization because they

update constantly

At any given moment, someone may need an inventory balance, anaccount balance or the total current value of a financial portfolio

Also called "online

transaction processing"(OLTP), the

OLTP market is a demanding one, often requiring 24x7 operation andthe most reliable computers and networks.

manual exampleA manual example of transaction processing would be that every time

you purchased an item, you added the amount paid to a running total.

Contrast with "batch processing,"


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CHARACTERSTICS OF ACHARACTERSTICS OF A TRANSACTIONTRANSACTION

PROCESSING SYSTEMPROCESSING SYSTEM

Rapid Processing

The rapid processing of transactions is vital to the success of any

enterprise now more than ever, in the face of advancing technology

and customer demand for immediate action. TPS systems are designedto process transactions virtually instantly to ensure that customer data isavailable to the processes that require it.

ReliabilityDesigned to ensure that not only do transactions never slip past the net,

but that the systems themselves remain operational permanently. TPS

systems are therefore designed to incorporate comprehensive

safeguards and disaster recovery systems.

Standardization Transactions must be processed in the same way each time to maximizeefficiency. To ensure this, TPS interfaces are designed to acquireidentical data for each transaction, regardless of the customer.

Control led Access

Since TPS systems can be such a powerful business tool, access must berestricted to only those employees who require their use. Restricted access

to the system ensures that employees who lack the skills and ability to

control it cannot influence the transaction process.


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Corporate

databases

ofinternaldata

Databases

of

externaldata

Databases

of

valid

transactions

Operational

databases

Transaction

processing

systems

Management

informationsystems

Decisionsupport

systems

Executive

supportsystems

Expert

systems

Business

transactions

Input and

error list

Drill-down reports

Exception reports

Demand reports

Key-indicator reports

Scheduled

reports

Employees

Corporate

intranet

Application

databases

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22. MANAGEMENT REPORTING. MANAGEMENT REPORTING SYSTEMSYSTEM

PurposeDESIGNED TO SUPPORT THE MANAGEMENT -

Provide managers with pre-defined types of information for relatively

structured type of decisions .

.

Regular, routine operations

Planning &Control Functions -Control, organize and plan better

Inputs to the System Output, or reports, are usually generated through accumulation of transaction

processing data

Data acquired from outside the organization

Data provided by business partners, suppliers&customers

Examples

Information systems support all levels of management, from those in charge of

short-term schedules and budgets for small work groups to those concerned with

long-term plans and budgets for the entire organization.

Provide routine, detailed, and voluminous information reports specific to each

managers areas of responsibili ty. Generally, these reports focus on past andpresent performance, rather than projecting future performance.

To prevent information overload, reports are automatically sent only under

exceptional circumstances or at the specific request of a manager.

Provides reports with fixed and standard formats. Hard-copy and soft-copy reports

Uses internal data stored in the computer system . End users can develop custom reportsRequires formal requests from users


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Outputs of a

Management Information System

Inputs: Information from the TPS

Outputs: hard and softcopy reports1. Scheduled reports

Produced periodically, or on a schedule (daily, weekly, monthly)

2. Key-indicator report

Summarizes the previous days critical activities

Typically available at the beginning of each day

3. Demand report

Gives certain information at a managers request

4. Exception report

Automatically produced when a situation is unusual or requires

management action

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Scheduled Report Example

Daily Sales Detail Report

Prepared: 08/10/xx

Order

#

Customer

ID

Sales

Rep ID

Ship

Date Quantity Item # Amount

P12453 C89321 CAR 08/12/96 144 P1234 3,214

P12453 C89321 CAR 08/12/96 288 P3214 5,660

P12453 C03214 GWA 08/13/96 12 P4902 1,224

P12455 C52313 SAK 08/12/96 24 P4012 2,448

P12456 C34123 JMW 08J/13/96 144 P3214 720

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Key Indicator Report Example

Daily Sales Key Indicator Report

This

Month

Last

Month

Last

Year

Total Orders Month to Date Rs1,808 Rs1,694 Rs1,014

Forecasted Sales for the Month Rs2,406 Rs2,224 Rs2,608

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Demand Report Example

Daily Sales by Sales Rep Summary Report

Prepared: 08/10/xx

Sales Rep ID Amount

CAR Rs42,345

GWA Rs38,950

SAK Rs22,100

JWN Rs12,350

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Exception Report Example

Daily Sales Exception Report ORDERS OVER Rs10,000

Prepared: 08/10/xx

Order

#

Customer

ID

Sales

Rep ID

Ship

Date Quantity Item # Amount

P12453 C89321 CAR 08/12/96 144 P1234 Rs13,214

P12453 C89321 CAR 08/12/96 288 P3214 RS15,660

P12453 C03214 GWA 08/13/96 12 P4902 Rs11,224

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Outputs of a Management

Information SystemEarnings by Quarter (Millions)

Actual Forecast Variance

2ND Qtr 1999 Rs12.6 Rs11.8 6.8%

1st Qtr 1999 Rs10.8 Rs10.7 0.9%

4th Qtr 1998 Rs14.3 Rs14.5 -1.4%

3rd Qtr 1998 Rs12.8 Rs13.3 -3.0%

Drill Down ReportsProvide detailed

data about a

situation.

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Structured vs. Unstructured Problems

Structured problems lend themselves toprogrammed decisions

The implication is that a repeatable processcan be employed and these can be

automated Unstructured problems require unprogrammed

decisions Can be addressed (or partially addressed) with

Decision Support Systems

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The Decision-Making Process

Systematic Decision-Making Process (SimonsModel)

Intelligence

Design

Choice

Implementation

Modeling is Essential to the Process

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Simons Model

Problem Identification

Qualitative

Analysis

Quantitative

Analysis

Decision

External Internal

AI, EIS

ESDbDSS,MbDSS

GDSS

ES

DSS

Intelligence

Design

Choice

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Data

ManagementModel

Management

KnowledgeManagement

User Interface

User

Other

Systems

DSS Architecture components

1. Data Management Subsys tem

2. Model Management Subsystem

3. Knowledge Management Subsystem

4. User Interface Subsys tem

5. The User

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Intelligence phase

Reality is examined

The problem is identified and defined Design phase

Representative model is constructed

The model is val idated and evaluat ion cri ter ia are

set

Choice phase

Includes a proposed solut ion to themodel

If reasonable, move on to the

Implementation phase

Solution to the original problemFailure: Return to the modeling process

Often Backtrack / Cycle Throughout the ProcessSUSHANT SHARMA


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Scan the environment to identify problem situations or

opportunities

Identify organizational goals and objectives

Determine whether they are being met

Explicitly define the problem

Classify the problem

Decompose into sub-problems

Is it my problem (ownership)

Can I solve it

Outcome: Problem statement

1. The Intelligence Phase

Problem or Symptom?SUSHANT SHARMA


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2. The Design Phase

Generating, developing, and analyzingpossible courses of action

Includes

Understanding the problem

Testing solutions for feasibility

A model is constructed, tested, and val idated

Modeling Conceptualization of the problem

Abstraction to quantitative and/or quali tative formsSUSHANT SHARMA


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Types of Decisions

Type of structure - Nature of task

Level of decision making - Scope

StructuredUnstructured

Strategic

Managerial

Operational

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3. The Choice Phase

Search, evaluation, and recommending an appropriatesolution tothe model

Specific set of values for the decision variables in a selectedalternative

The problem is considered solved after the recommendedsolution to the model issuccessfully implemented

Search Approaches Analytical Techniques

Algorithms (Optimization)

Blind and Heuristic Search Techniques

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4. TheImplementationPhase

There is nothing more difficult to carry out, nor moredoubtful of success, nor more dangerous to handle, thanto initiate a new order of things (Machiavelli [1500s])

*** The Introduction of aChange ***

Important Issues

Resistance to change

Degree of top management support

Users roles and involvement in system development

Users training

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(3) Concept of Decision

Support Systems (DSS)

Scott Morton [1971]

DSS are interactive computer-based systems, which help

decision makers utilizedata andmodels to solve

unstructured problems [1971]

Keen and Scott Morton [1978]

Decision support systems couple the intellectual resourcesof individuals with the capabilities of the computer to improve

the quality of decisions. It is a computer-based support

system for management decision makers who deal with

semi-structured problems.

DSS: means di fferent things to di fferent peopleThere is no universally accepted definit ion of DSS

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Working Definition of DSS

A DSS is an interactive, flexible, and adaptableCBIS, specially developed for supporting thesolut ion of a non-structured management problemfor improved decision making. It utilizes data, itprovides easy user interface, and it allows for thedecision makers own insights

DSS may uti lize models, is buil t by an interactiveprocess (frequently by end-users), supports all thephases of the decision making, and may include aknowledge component

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Components of a DSS architecture

The database (orknowledge base),

The model (i.e.,the decisioncontext and

user criteria),

and

The userinterface.

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(A) The Data Management

Subsystem

DSS database

Database management system

Data directory Query facility

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DSS In Focus: The Capabili ties of DBMS in a DSS Captures/extracts data for inclus ion in a DSS database

Updates (adds, deletes, edits, changes) data records and files

Interrelates data from different sources

Retrieves data from the database for queries and reports

Provides comprehensive data security (protection fromunauthor ized access, recovery capabil ities, etc.)

Handles personal and unofficial data so that users can experimentwith alternative solutions based on their own judgment

Performs complex data manipulation tasks based on queries

Tracks data use with in the DSS

Manages data through a data dict ionary

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DSS Database Issues

Data warehouse

Special independent DSS databases

Extraction of data from internal, external andprivate sources

Web browseraccess of data

Multimedia databases

Object-oriented databases

Commercial database management systems

(DBMS)

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(B) The Model Management

Subsystem

Mirrors the database management

subsystem

Model Management Issues

Model level: Strategic, managerial (tactical)

and operational, model building blocks

Modeling languages

Model execution, integration

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DSS In Focus : Major Functions (Capabili ties) of the MBMS

Creates models easily and quickly, either from scratch or f rom existing

models or from the building blocks.

Al lows users to manipulate the models so they can conduc texperiments and sensitivity analyses ranging f rom what-if to goal

seeking.

Stores, retrieves, and manages a wide variety of different types ofmodels in a logical and integrated manner.

Accesses and integrates the model building blocks.

Catalogs and displays the directory o f models for use by several

individuals in the organization.

Tracks models data and application use.

Interrelates models with appropr iate linkages with the database andintegrates them wi thin the DSS.

Manages and maintains the model base with management functionsanalogous to database management: store, access, run, update, link,

catalog, and query.

Uses multiple models to support problem solving.

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(C )The Knowledge Management

Subsystem

Provides expertise in solving complex unstructuredand semi-structured problems

What models to use, how, interpreting results

Reasoning, handling uncertainty, learning from data

Expertise provided by an expert system or other

intelligent system (AI techniques) Leads to intelligent DSS

Example: Data mining Data Mining for Decision Support

Software analyzes vast amounts of data

Attempts to discover patterns, trends, & correlations

May perform regression, decision tree, neural network, cluster

detection, or market basket analysis

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(D) The User Interface (Dialog)

Subsystem

Includes all communication between a

user and the MSS

To most users, the user interfaceis the

system

Managers

Staff specialists

Intermediary:1.Staff assistant2.Expert tool user

3.Business (system)analyst4.Group DSS Facili tator

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Distinguishing DSS from

Management Science and MIS

DSS is a problem solving tool and is

frequently used to address ad hoc and

unexpected problems

Different than MIS

DSS evolve as they develop

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Differences in System Characteristics

Dimensions TPS MIS DSS

Type of

users

Clerical and

supervisory

Middle

Management

All levels

including top

mgmt. and

professionals.Focus Data

transactions

Information Decision,

flexibility

Applications Payroll, sales

data, inventory

Sales

forecasting,

Production

control,

Strategic

planning,

integrated

problems


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Groups

Most major decisions in medium and large

organizations are made by groups

Conflicting objectives are common

Variable size People from different departments

People from different organizations

The group decision making process can be very

complicated

Consider Group Support Systems (GSS)

Organizational DSS can help in enterprise-wide

decision making situationsSUSHANT SHARMA


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4. EXECUTIVE INFORMATION SYSTEM4. EXECUTIVE INFORMATION SYSTEM

Purpose

Critical information readily available in a highly summarized and

convenient form.

Type of management information system intended to facilitate andsupport 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 organization. It is

commonly considered as a specialized form of a Decision Support

System (DSS)

Features The emphasis of EIS is on graphical displays and easy-to-use user interfaces.They offer strong reporting and drill-down capabilities. In general, EIS areenterprise-wide DSS that help top-level executives analyze, compare, and

highlight trends in important variables so that they can monitor performance

and identify opportunities and problems. EIS and data warehousing

technologies are converging in the marketplace.

Users

This assistance is important for the chief executive officer, senior and executive vice

presidents, and the board of directors to monitor the performance of the company, assess thebusiness environment, and develop strategic directions for the future. In particular, these

executives need to compare their organizations performance with that of i ts competitors and

investigate general economic trends in regions or countries for potential expansion. Often

relying on multiple media, executive information systems give their users an opportunity todrill down from summary data to increasingly detailed and focused information.


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EXECUTIVE INFORMATION SYSTEMS - EIS

Business Content Strategic Planning

Uses External data (External Environment)

Unstructured Problems + Executive Experience

For example: Policy formation for Labor strike Where decisions taken are not the results of series of steps

in some order

Presentation content Drill down reporting

Exceptional reporting Graphical summary

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5.5. KNOWLEDGE BASED SYSTEMSKNOWLEDGE BASED SYSTEMS-- EXPERTEXPERT SYSTEMSSYSTEMS

Purpose A software that attempts to reproduce the performance of one or more humanexperts , most commonly in a specific problem domain

Methods to simulate the

expert performance

1) Creation of "knowledgebase" which uses some knowledge representation formalism to

capture the Subject Matter Experts (SME) knowledge and

2) a process of gathering that knowledge from the SME and codifying it according to the

formalism, which is called knowledge engineering.

3) Expert systems may or may not have learning components but a third common element

is that once the system is developed it is proven by being placed in the same real world

problem solving situation as the human SME, typical ly as an aid to human workers or asupplement to some information system.

Feature

Use of "confidences/certainty factors. A human, when reasoning, does not always conclude

things with 100% confidence: he might venture,

These numbers are similar in nature to probabilities, but they are not the same: they are

meant to imitate the confidences humans use in reasoning rather than to fol low the

mathematical definitions used in calculating probabilities.

Individuals involved

with expert systems

1. End-user; the individual who uses the system for its problem solving assistance.

2. Problem domain expert who builds and supplies the knowledge base providing thedomain expertise,

3. Knowledge engineer who assists the experts in determining the representation of their

knowledge, enters this knowledge into an explanation module and who defines the inference

technique required to obtain useful problem solving activity. Usually, the knowledge engineer

will represent the problem solving activity in the form of rules which is referred to as a rule-

based expert system. When these rules are created from the domain expertise, the

knowledge base stores the rules of the expert system.

T f Fil O i tiT f Fil O i ti


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Types of File OrganizationTypes of File Organization

2. Sequential File

Files on sequential access media are generally organized in the sequential mode.

Records arranged in the ascending or descending order of the values of a key attribute in

the record.

Sequence of records in the file can be changed by sorting the file. Updating and processing

of records on a sequential access media is carried out in a batch mode. Transactional

changes are collected in a batch periodically. For example, transfers, promotions,

retirements which lead to changes in the personnel file data can be collected on monthly

basis. These transactions collected in a batch are then recorded in transaction file. Thetransaction file is arranged in the same sequence as the master file to be updated. The

additions, deletions and changes are then carried out in the records of the master file and

the updated records are then written on the new updated master file.

Sequential File Methods

Four Methods:-

1. Sequential Search: Each record is read one after another starting from the first record

in the file till the desired key attributed value is reached.

2. Binary Record: Binary search reduces the search time considerably. In binary search,

the first record to be read is the one in the middle of the file. Example in 200 records,

the 100th record will be read first. By this way, we can decide whether the desired

record lies in the first half of the file. The process is repeated many times till thedesired record has been localized to small area, say 5 or 10 records. This area of 5 or

10 records is then searched sequentially to locate the desired record.

3. Probing: Probing is done where the approximate range in which the desired record

may lie can be ascertained from the value of the key attribute.

4. Skip Search: In skip search, records are accessed in a periodic order. Say, every 20th

record is read till the value of the key attribute exceeds the desired value.

1. Pile Files

Adopted when -records in any logical order or fields of records are not well-

defined.

Files created by punching the documents in the order they arrive.

Location of record can be done by sequentially searching the records ti ll the

desired value of the key attribute is reached. Addition of new records is very

simple. New records are added at the end of the file. Changes or deletions are

possible.

The fi le may be reorganized periodically to remove the holes created by thedeletion of records.

T f Fil O i iT f Fil O i i


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Types of File OrganizationTypes of File Organization

4. Indexed File (Inverted

File)

One index is maintained for each key attribute of the record.

The index file contains the value of the key attribute followed by the addresses of all the

records in the main file with the same value of the key attribute. Addition of records in the

main file can be made at the end of the file since it is not maintained in any sequence.

However, corresponding entries have to be made in all the index files for the key attributes

of the record.

5. Direct File This method is generally used where the range of the key attribute value is large compared

to the number of records. Direct files are maintained in any particular sequence. Instead,

the value of the key attribute is converted in to sector address by a predetermined

relationship. The predetermined relationship converts the value of the key attribute into

the sector address for the storage and retrieval of the record.

The ratio of the number of records stored to the total capacity of the file is called the

loading factor. High loading factor leads to too many collisions thereby increasing the

search time for the records and vice-versa.

3. Indexed Sequential File Delay in search in sequential file can be reduced by providing an index to the file. Such a

file is indexed sequential file. The index of the file contains a pointer record for one group

of records in a main file. The index file can be searched by the sequential search or binary

search method. Files can be indexed on the key attribute in which they are sequenced or

non-sequenced. Addition of records are made in the overflow areas. For this purpose,

some sectors in the area forming the group can be kept blank. The added record is chainedto the records immediately preceding and immediately following the added record in the

sequence by providing a pointer to the added record.

6. Multiring File Where lists of records with specified key attribute value are desired frequently, multiring

files are useful. The directory file, like the one in the inverted file organization, contains

the pointer to the first record with specified key attribute value. The first record contains

the address of the second record in the chain and the second contains the address of the

third record. When the last record in the chain contains pointer to the first record, the

records are said to form a ring. A number of such rings for different key attribute values

and for different attributes can be formed. The directory provides entry point to the rings.

Str ct re of Data Base


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Structure of Data-Base

Models of Data Structure

1. Hierarchical model

2. Network Model

3. Relational Model

Hierarchical Model:

Relationship between entities is stored in the form of a tree which has a root. The root may have a

number of branches and each branch may have a number of sub-branches and this may continue for any

number of levels.

The record at the lower level is called the child of the next higher level and the higher level record is

called the Parent of its child records. For example a project may consist of sub-projects of work centres

and each work centre may have a number of employees in it.

Network Model:The relationships are stored in the form of sets; each set having one owner and a number of members.

For example, to indicate the employee working in a work-centre, the work-centre will be the owner of the

set and each employee a member of that set.

A entity may be a member of more sets and the owner of a set may be member in another set and vice-

versa.

Relational Model: In this approach, both the entityrecords and relationship

Project no. Name Location Budget

E1 X X X

E2 X X X

E3 X X XSUSHANT SHARMA


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Employee

Employee no. Name Designation Pay

E1 X X X

E2 X X X

E3 X X X

E4 X X X

E5 X X X

E6 X X X

E7 X X X

E8 X X X

E9 X X X

Project - EmployeeProject no. Employee no. % Time

P1 E1 20

P1 E3 28

P1 E7 35

P2 E1 25

P2 E4 40

P2 E9 32

P3 E3 15

P3 E7 30

P3 E9 20

Records are stored in the form of tables

called relation. For example, if we want to

store the project records, the employee

records and the relationship between the

project and the employee indicating the

percentage of the employee time devoted to

that project, it may be stored in the form of

three tables.

Relational approach is more amenable tomathematical theory by considering each

table as a mathematical relation, each row of

the table considered as a tuple and each

column in the row as the attribute drawn from

a population domain. For the reason the

relational approach is superior to other

approaches.SUSHANT SHARMA


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Advantages of Data-Base Syst ems

i. Redundancy controlled: In traditional file systems, each application has its own private files. Many of the data items in a file may be common to

other files i.e., the same data items in a file may be stored in a number of files. Apart from wastage of storage space, multiple updation are required

for a single transaction in the real system. This is avoided by maintaining only one copy of the data in the data-base system and interlinking them

by logical relationships. Even if, multiple copies have to be maintained due to technical reasons, this fact is known to the data-base system and the

copies are updated automaticallywith the single user entry.

ii. Inconsistency Avoided: updation of separate application files for the same real transaction leads to inconsistency of data because different

application file are updated at different points according to schedule. Two separate files may, thus, indicate different status of the same data at a

given point of time. For example, the record file may show that employee A is posted in department X while at the same time the department

record file may indicate that he is posted in department Y. Control of redundancy automatically solves the problem of inconsistency, in the data-

base system.

iii. Integrity of Data: Inconsistency between two entries representing the same facts is an example of lack of integrity of data. Even if the redundancy is

controlled, there may still be in accuracies in data. For example an employee may be shown posted in two separate departments in the department

wise file or an employee may be shown to have worked for 200 hours in a week. The central control of data provided in the data-base system helps

to control such inaccuraciesin data and maintainits integrity.

iv. Integrated View of Data: Integrat ion of related files in the data-base system provides an integrated view of data. The data needs of a topmanagement query, like the proportion of a department budget for pay and allowances spent on a specific project, may cut across various

applications.Such queries are extremely difficultto answer in a traditional filesystem.

v. Unstructured information Needs: Information needs of unstructured management decisions are not known in advance and cannot be pre-

programmed. Since the related data are centralized and the relationship structure among entities is built into the data-base, it is more suited to

handle unstructured queries.

vi. Enforcement of Standards: With central control of the data-base, the Data-Base Administrator can ensure that desired standards are followed in

the representation of data. Standardizingof data formatsis particularly important for interchange or migration of data between systems.

vii. Security Restrictions: The Data-base Administrator, having complete jurisdiction over the operational data, can ensure that access to the data-

bases is available only to the authorized users. He can define different authorization checks for each type of access viz., retrieve, modify, delete

etc., to each piece of informationin the data-base.

viii. Data independence: It is a crucial advantage of the data-base system over the traditional file system. Most traditional file systems are highly data-

dependent. This means that the way the data are organized and the way it will be accessed is dictated by the needs of the specific application. The

knowledge of the storage organisation and the access strategy is built into the application software. For example, if the data are organized in the

indexed sequential manner, this fact has to be known to the application software and the procedures for retrieval and updating of data are built in

the application software keeping this fact in view. A change in the storage structure or access strategy of data will drastically affect the application

software. It was found in some of the traditional systems that organizations were spending as much as 6% of their programmers time on the

modificationsof the existing application software and only 40% on the development of new software.SUSHANT SHARMA


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TRANSFORMATION OF BUSINESS

GLOBALIZATION Global Market Environment

KNOWLEDGE-BASED ECONOMIES More jobsin sales ,education& services than factories

PRODUCTIVITY

NEW PRODUCTS & SERVICES

KNOWLEDGE AS AN ASSET

TIME-BASED COMPETITION

SHORTER PRODUCT LIFE

TURBULENT ENVIRONMENT

LIMITED EMPLOYEE

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TRANSFORMATION OF ENTERPRISE

FLATTENING- Squeezing FunctionalHierarchy

DECENTRALIZATION- Distributed Work Load

FLEXIBILITY- Offers openness of workinghours& decision making for employeesconvenience

LOCATION INDEPENDENCE GivesPossibilities of Mobile and virtual offices

LOW TRANSACTION COSTS

EMPOWERMENT

COLLABORATIVE WORK People work incoordination

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Technology Features Description

Processing capability

Increase in computing power and reduction in prices

of hardware has given rise to the availability of

machines to masses.

Portable Computing

Computers are available in handy sizes, which can

be ported, plugged and played at any place. This

adds to the services of mobile business persons,

e.g., directors, managers, sales persons.

Global Networking

Information network infrastructure has advanced to

the extent that today you can access any computer

from any where in the world.

Enterprise Networking

Easy work flow automation can be done to reduce

paper work and speed up the processing of

documents in the offices.

Distributed Computing

This feature facilitates the requirements for

empowerment and decentralization of work to

employees.

Graphical User Interface

Easy to learn graphical interfaces have saved theusers from the unpleasant task of memorizing

commands. Now, end users can operate the

software with great ease. New, fascinating form of

data presentations have given a boost to the usage

of the systems.

INCREASED CAPABILITY OF IT

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MIS is an integrated collection of functional

information systems, each supporting

particular functional areas.

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Etc.

An Organizations

MIS

Financial

MIS

MarketingMIS

HumanResources

MIS

Accounting

MIS

Drill down reports

Exception reports

Demand reports

Key-indicator reports

Scheduled reports

Databases

of

external

data

Databases

of

valid

transactions

Transaction

processing

systems

Business

transactions

Business

transactions

Extranet

Internet

Figure 9.3

Etc.

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Financial MIS

Finance information system help organize

budgets, manage cash flow, analyze

investments, and make decisions that

could reduce interest payments andincrease revenues from financial

transactions

Provides financial information to all

financial managers within an organization.

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Financial statements

Uses and management

of funds

Financial statistics

for control

Operational

databases

Databases

of valid

transactions

for each

TPS

Transaction

processing

systems

Business

transactions

Business

transactions

Internet or

Extranet

Figure 9.3

Financial

MIS

Business

transactions

Databases of

external data

Databases of

internal data

Financial

DSS

Financial

ES

Financial

applications

databases

Customers,

Suppliers

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Inputs to the Financial

Information System Strategic plan or corporate policies

Contains major financial objectives and often projectsfinancial needs.

Transaction processing system (TPS) Important financial information collected from almost

every TPS - payroll, inventory control, order processing, accounts payable, accounts receivable,general ledger.

External sources Annual reports and financial statements of

competitors and general news items.

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Financial MIS Subsystems

and Outputs Financial subsystems

Profit/loss and cost systems

Auditing Internal auditing

External auditing

Uses and management of funds

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Financial Information Systems

Payroll link to human resources system

Accounts payable link to purchasing and

inventory

Patient accounting, billing, accountsreceivable

Cost accounting, including allocating

overhead

General ledger

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Financial Information Systems

(continued)

Budgeting

Internal auditing

Forecasting

Planning financial investments Cash flow vs. cash need

Financial statements

Financial reporting for top management

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Finance

The job of financial managers is to managemoney as efficiently as possible by:

Collecting payables as soon as possible

Making payments by the latest time allowed by

contract or law Ensuring that sufficient funds are available for

day-to-day operations

Taking advantage of opportunities to accrue the

highest yield on funds not used for currentactivities

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Finance

Cash Management Financial ISs help balance the need to accrue

interest against the need to have cash

available.

Cash management systems (CMS): Handlecash transactions specifically.

Electronic fund transfer (EFT): The electronic

transfer of cash from one bank account to

another.

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Finance

Investment Analysis and Service

Analyze and project the prices of aspecific stock or bond.

Transmit buy and sell orderselectronically.

Provide clients with a detailed statement.

Monitor account information and news

online.

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Marketing MIS

Marketing information system help analyze demand for

various products in different region and population

groups in order to more accurately market the right

product to right producer.

Marketing ISs provide information that helps

management decides how many sales representatives to

assign to specific products in specific geographical area

Supports managerial activities in product development,distribution, pricing decisions, and promotional

effectivenessSchematicSUSHANT SHARMA


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Sales by customer

Sales by salesperson

Sales by productOperational

databases

Databases

of valid

transactions

for each

TPS

Transaction

processing

systems

Business

transactions

Figure 9.9

Marketing

MIS

Databases of

external data

Databases of

internal data

Manufacturing

DSS

Manufacturing

ES

Marketing

applications

databases

Pricing report

Total service calls

Customer satisfaction

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Inputs to Marketing MIS

Strategic plan and corporate policies

The TPS

External sources:

The competition The market

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Marketing MIS Subsystems and

Outputs

Marketing research

Product development Promotion and advertising

Product pricing

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What is marketing information

system ?Marketing information consists of people,

equipment and procedures to gather, sort,

analyze, evaluate and distribute needed,timely and accurate information to marketing

decision makers.

Marketing decision makers use the data toidentify and solve marketing related problems.

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Marketing Information system suppliesthree types of information.

Recurrent Information

Monitoring Information

Requested Information

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Recurrent Information

This is the data that an MIS supplies

periodically about the market share of a

specific product and customers awareness

of companys brands. The data may besupplied on weekly, monthly or yearly

basis.

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Monitoring Information

This is the data obtained from the regular

scanning of certain sources. Marketing

managers may need data related to

competition or the industry. It is essential sothat marketing managers can be alert and

identify potential problems

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Requested Information

This information is developed in response

to some specific request by the marketing

manager. Secondary data or primary data

through survey research are collected in

response to the specific request. The MIS

supplies the requested information for

decision making.

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Marketing Information system

External data

Internal data

Requested

information

Marketing

Research

division

Marketing

Information

system

Marketing

Managers

Division

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Sources of Marketing Information .

The MIS information inputs come from differentsources, viz., both within and outside firms .

Some of the commonly used internal sources of

information are:

Sales Analysis- The marketing information

system retrieves sales information and put them

in usable and disaggregated form. It detects

various marketing strengths and weaknesses.

Computer assisted sales analysis uncovers

significant details for management needs.

SUSHANT SHARMA

C t A l i Th t l i i ibl


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Cost Analysis-The cost analysis is possiblewith the effective accounting system. Theclassification and analysis of the cost ofproduction, cost of distribution and sellingmay provide adequate information for themanagement purposes .

Financial Records- The financial records &publications may provide adequateopportunities for management of sales &marketing activities .Many companiesprepare periodical final statement to

observe the balance of each item of financial records.

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Why

InformationIsNeeded

MarketingEnvironment

Strategic

Planning

CustomerNeeds

Competition

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Importance of marketing information system

Anticipation Of Customer Demand-Every

marketer needs up-to-date knowledge aboutconsumer needs and wants.

Systematic Approach-Expanding marketsand competitive marketing environment

require adequate market intelligence system.

Economic indicator -Marketers must havelatest information on the changing trends of

supply, demand and prices

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Significance of Analysing Competition-Marketer

cannot survive without having information regarding

nature , character and size of competition to be met.

Development of Technology-Marketers must have

latest information regarding technological development.

Understanding the Consumer-Information system canestablish proper two way flow of information and

understanding between marketers and consumer.

Marketing Planning-Marketing plans and programmesare based upon information supplied by economic

forecasts and market research.SUSHANT SHARMA


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SYSTEM DEVELOPMENT LIFE

CYCLE METHODOLOGY

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SYSTEMPLANNING


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SYSTEMPLANNING 1Mechanized Vs Non Mechanized IS

2CentralizationVs Decentralization of computing facilities

3Batchmode Vs real Time mode of Info.Processing

4IndependentVs Modular method of designing IS

1, PERFORM COST -BENEFIT ANALYSIS

BENEFITS Reduction in staff , Improved Processing speed per unit of workload, ready access to info, reduction in

expenditure to store ,analyze and organize massive business data

DISADV:- Equipment Cost, Enhancement in the cost More skilled and higher paid staff, technical involvement of professionalprogrammers, expenses encountered for formatting and reproduction of data

DEVELOPMENT STAGE SOFTWARE BASED1Decide coding language based on nature of application area, quantum of data to be handled, and amount of calculation,

basic software language availability to handle any language (BASIC, COBOL, FORTRAN, PASCAL, C, ORACLE, andJAVA etc.

2Decide on capacity of computer ( 8 Bit/ 16 Bit)

3Utility Part of basic software transfer of data from card reader to tape drives , from disk drive to the printer etc. Larger the

computer, more the utilities reducing writing of programs to some extent due to sorting and merging facility.

4Multiprogramming facility with lesser files on the disk for limited memory space and tape disk facilities.

System Feasibil ity Test /Evaluation of c omplete System Plan1Based Checking ability to meet user needs/ Use of resources to generate benefits, Impact on user organization, Workability of

the system ---- Check scope and complexity of computerization

System Design Information base according to Sources, characteristics, Purpose-

1Sources can be single/dual . Eg. Accounts deptt. (single source) .Inventory IS (dual) Stores and Purchase depts.

2Purpose- User how it will be used and when it will be used

3Characteristics of Info- Size, variability , volatility &activity

SUSHANT SHARMA

DEVELOPMENT STAGE PROCESS BASED1Understanding Physical flow of data and current usage


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2Decide outputs attributes- Format /frequency/presentation/ items of output info, level of aggregation

3Decide input requirement source, agency for collection , format, frequency of collection , items of data ,

4Developing Logical questions with Yes /No results leading to further progress and back tracking

5Develop codification sheet for writing programs

6Removal of errors from the program(debugging) and their integration into system design

7Testing with sample data8Ensuring computerized system to deliver results before discontinuing the manual system

9Development of Manuals

1Comprehensive training and instructions to the user.

IMPLEMENTATION STAGE

1Obtaining Input - Output from the computer-2 -way Process . test run and parallel run

2Documentation System Manual , operation manual and user manualSystem Manual indicated complex design of IS showing different elements of computerization linked through flowchart, types of output, and

formats of input.rief outline of IS

Operational Manual Technical instructions for the actual computer operations different job steps

User Manual brief outline of IS, its major benefits, Inputs needed and outputs expected.

3User Training

4Modification to the installed system Continuous Process for the professional so that IS is updated and meaning for the user for changes in the environment

Process Evaluation1Design of the system and quality of programming determine Time taken by processing

2Utilization of hardware resources- different memory partitions &allocating input output devices to each partition

3Lack of debugging leads to time run and again- Best check- Lay down permissible no of development runs before sending it of production runs

Product Evaluation1Ensure acceptable quality of output report and continue to be use in

System Audit1Identifying Locations of control points for system errors and reasons for selection of these points on the basis of frequency of

error ,magnitude of error ,cost of error detection

2Develop Audit trait a series of well defined provisions which permit a person to follow and verify the system process.

3Establish steps for System recovery issue , system processing alternatives ,system security , systems restart

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COMPUTER SOFTWARESCOMPUTER SOFTWARES

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System software


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y

Computer program -designed to run a computers hardware and application program

System software is the interface between the hardware and user applications.

Example Operating System - Manages all the other programs in a computer.

System Software have direct control and access to your computer hardware , and

memory locations . They perform I/O operations on various memory locations , and

control the hardware , to make the application software do a task .

Examples :1) Microsoft Windows

2) Linux

3) Unix

4) Mac OSX

5) DOS

6) BIOS Software

7) HD Sector Boot Software

8) Device Driver Software i.e Graphics Driver etc

9) Linker Software10) Assembler and Compiler Software

Appl ication sof tware


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Appl ication sof tware

Run under System Software , and are made to do a specific task i.e ( Word

Processing etc) , which have indirect access to the hardware (i.e Behind System

Software) .

Unlike system software, an application program performs a particular function for the

user. Examples (among many possibilities) include browsers, email clients, Word

Processor and spreadsheets

Examples :

Web browser, word processing software, spreadsheet software, database software, presentation

graphics software.

1) Opera (Web Browser)

2) Microsoft Word (Word Processing)

3) Microsoft Excel (Spreadsheet software)

5) MySQL (Database Software)

6) Microsoft Powerpoint (Presentation Software)

7) iTunes (Music / Sound Software)

8) VLC Media Player (Audio / Video Software )

9) World of Warcraft (Game Software)

Wh t i th I t t?


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What is theInternet?

The Internet is a public network offering a variety of facilities including:

The World Wide Web (WWW): Used to display hypertext documents andinteractive hypermedia, allow input into forms, and deliver distributed database

applications.

e-mail: Useful for inter- and intra- organisational communication, andFTP (File

Transfer Protocol): for exchanging files.

The Internet can be of business value through:

marketing:development andpromotion of products and services,

sales:processing of business transactions, and

service:provision of information.

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Internet advertising / brand development /

corporate image.

Product Differentiation: Use of the Internet

to offer unique features and electronic

services and to create institutional

distinctiveness.

Product Innovation and Growth: Creation

ofnew products and services, and new

markets;Mass customisation of

products;Global expansion.

Delivering attractivevalue-laden

content at a reasonable price. This entails

the provision of easily accessible, regularly

updated, diverse and elegant content.

Dynamic adaption to customer behaviour

Quickertime to market.

Online, instantaneous quoting.

Fastertransaction speeds

Secure transactionsand order

processing

Automatic integration andcommunication with back-office workflow

system.

Improved user interfaces that

areintuitive andhide the complexity of

the underlying technology

Automated reminders and re-ordering

Faster customer service

Customers engage inself-

service therebyreducing administrative and

processing overheads. For example,

customers can check their own account

information, track parcels, and perform

interactive needs analyses, without

needing human assistance.

Provision ofany time of day or night

services and facilities to customers and

employees around the globetranscends

the limitations of time and place.

Availability ofreal-time, up-to-

dateinformation.

Reduced lead times

Reduced consumer search and selection

cost

Feedback from clients

Business Advantages

Cost Advantages. The Internet can decreased the marginal costs of marketing, sales, and service.

Improving the infor mation metabolism of firms . New Internet information technologies, such as e-mail filtering, can helpreduce co-

ordination costs andmitigate the information overload, thereby speeding up the " information metabolism" of firms - that is, the ability of firms to

take in, move, digest, and respond to data. The Internet provides a useful and low-cost mechanism for information storage, transport, and

processing. The Internet thus becomes an avenue for improving communication and co-ordination and streamlining business processes.

Improving the effectiveness, and thus profit ability, of management decisions and actions . The Internet can add value by providing

managers (including human managers and software agents) with relevant and reliable information, in the right format, anywhere, and in real-

time. For example, managers can do market research through transaction analysis and can view up-to-the-minute management reports.

Intranet -private network that uses Internet software and standards to connectinternal

employees. The Intranet is effectively an in-house version of the Internet. The Intranet


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Process Re-engineering Enterprise Applications

The Intranet can be of business value as a means for

connecting staff and improving internal

communicat ion and co-ordinat ion. The Intranet

provides a means of connecting business units across

multiple computing platforms. The Intranet

thus facilitates effective re-engineering by allowing

business processes to be built across organisational

barriers. Effective re-engineering streamlines the

internal value chain and can drastically reduce costsand lead times, and improve flexibility and customer

service.

The Intranet is well-suited to a variety of enterprise

applications including:

workflow applications

human resource applications

Examples of human resource appl icat ionsinclude

use of the Intranet for performance

management and benefit scheme administration. For

instance, staff could tailor their own benefits package

without creating additional paperwork for the Human

Resources department. The Intranet can also be

aneffective training and information dissemination tool,

providing employees with access to up-to-date

information and tutorials.

Replacing Traditional Client/Server Applications

The Intranet is an ideal mechanism for replacing traditional, platform-specific client/server applications.

Traditional client/server applications promote 'islands of automation' within companies, by restricting inter-

departmental communication and causing rework, duplicate data capture, and errors as data is passed between

different applications and operating systems. Intranets, which are platform independent, promote cross-

functional co-operation,electronic integration, andbusiness synergy.

is fast becoming the network platform of the future. It is also becoming the dominant

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What is anExtranet?

The trend towards integrating with business partners means that Intranetsare no longer strictly private networks, and companies are granting access

to suppliers, vendors, customers, and other business partners. This

extension of the Intranet to permit controlled access to specified third

parties has been termed anExtranet.

Extranets can fully support all transactions between business partners, as

well as provide value-added information. Extranets are appropriate forinfrequent, ad hoc transactions, and short-term trading relationships as well

as for regular transactions and long-term trading relationships.

The Extranet can be of business value as a means of connecting buyers and sellers. The advantages to be


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g y g

found are:

Extranets promote value chain integrat ion. Extranets, which are inter-organisational networks, permit

closer integration of adjacent steps in the value-chain, and allow joint, interpenetrating processes at the

interface between value-added stages. Barriers between the organisation and business partners and

customers are lowered. Electronic integration leads to greater efficiency, data integrity and fewer

errors asdata need only be entered once, at its source. For example, the customer fills in an order form on-line, and the order details are automatically written to the database or electronically forwarded to the

workflow system. Tighter coupling of business partners results in time savings and faster, more cost-

effective client service. Integration can also lead to theelimination of duplicate tasks and resources. Finally,

integration can result inentirely new business models throughintermediation anddisintermediation.

Extranets provide the benefits of Electronic Data Interchange (EDI). Electronic Data Interchange (EDI)

is the inter-process communication of business information in standardised electronic form. Amongst the

benefits of EDI are:

Reduced t ime and expense of paperwork . EDI provides fast, inexpensive, reliable connections to

suppliers and customers. Fullydigital information exchange eliminates paperwork.

Improved speed and efficiency in filling orders (i.e. reduced cycle and order fulfilment times)

Quicker transfer of business documents

Faster customer service

Fewer errors

Automatic audit trails

Expanded customer/supplier baseReduction of manual, labour-intensive activities

Automatic integration with internal business workflow systems

Extranets help improve customer relat ions and foster a better understanding of customer needs


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Extranets help improve customer relat ions and foster a better understanding of customer needs.

This is achieved through transparent customer tracking and transaction analysis, personalization, direct

feedback from customers, and pro-active provision of information to customers. Client and supplier services

are improved and become more cost effective, especially as clients and suppliers engage inself-service.

For instance clients can perform a computerised analysis of their needs, can check their own account

information, or can track the status of orders and deliveries without needing human assistance.

Extranets can help to lock in partners and customers. Information gathered on customer needs and

behaviours represents a switching barrier as "customers would need to teach a competitor all that

information".

Extranets reduce inventory and improve inventory turnover rates.

Extranets reduce procurement costs and time. Extranets reduce search, selection,

andtransaction costs. The purchasing process is thus quicker, more convenient, and cheaper. The use of

advanced computerised search engines as part of the Extranet helps customers to quickly locate the

cheapest or most appropriate products.

Extranets have global reach. Because the Internet is used as the platform for the Extranet, the Extranet

network has global reach.

Extranets enhance the firm's flexibili ty. Because the Internet is an open, public, ubiquitous network it is

easy and cheap for new trading partners to connect to the Extranet network (which has the Internet as its

foundation).

Extranets improve management decis ions through up-to-the-minute management reporting on

transactions and web-site activities.

MIS - Mr. Sushant Sharma

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Transcript of MIS - Mr. Sushant Sharma