MIS 648 Lecture 141 MIS 648 Presentation Notes: Lecture 14 Selecting Offshoring Sites.
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Management Information System
Prof. Arathi S. Purohit
Basic Terminologies Data : Unstructured Raw Facts, Observations
or unevaluated messages. Information : Finished Product Database : Finished Product laid in a
systematic format. File : Logical Existence / name given Document : Textual Record
Stages in converting Data to Information
Capturing Verifying Classifying Arranging / Sorting Summarizing Calculating Storing Retrieving Reproducing Communication
Classification of Information Action Information : Induces action Non – Action Information : Communicates the
status Recurring : Regular Information Non – Recurring : Non repetitive Internal Information External Information
Types of Information Strategic Level
For strategic decision making one needs strategic information. It needs more futuristic inputs.
Tactical Level Tactical information used for medium and short
term planning by middle level management. Operational Level
It covers current happenings, information about specific product or task.
Introduction to MIS
An MIS provides managers with information and support for effective decision making, and provides feedback on daily operations.MIS is a system, which makes available the Right Information to the Right Person at the Right place at the Right Time in the Right Form and at Right Cost.
Purpose & Scope
The Purpose and Scope of MIS can be defined as “The combination of human and computer based resources that results in the collection, storage, retrieval, communication and use of data for the purpose of efficient management of operations and for business planning”.
Expectations from MIS Handling of Corpus data Confirmation of validity of data Complex processing through Multi
Dimensional analysis. Quick Retrieval Mass Storage Dynamic Timely Communication
MIS Reports Scheduled reportsProduced periodically, or on a schedule (daily, weekly, monthly) Key-indicator reportSummarizes the previous day’s critical activitiesTypically available at the beginning of each day Demand reportGives certain information at a manager’s request Exception reportAutomatically produced when a situation is unusual or requiresmanagement action Drill Down ReportsProvide detailed data about a situation.
Functional Systems Financial MIS Manufacturing MIS Marketing MIS Human Resource MIS Accounting MIS Geographic information systems
Financial Subsystems Financial information to all financial
managers within an organization. Profit/loss and cost systems Auditing
Internal auditing External auditing
Uses and management of funds
Manufacturing Subsystems Product Designing Production scheduling Inventory control Manufacturing resource planning (Materials
Requirement Planning with Capacity Requirements Planning)
Just-in-time inventory and manufacturing (Toyota Processing System)
Process control Quality control and testing
Marketing Subsystems Marketing research Product development Promotion and advertising Product pricing
Human Resource Subsystems Human resource planning Personnel selection and recruiting Training and skills inventory Scheduling and job placement Wage and salary administration
Accounting Subsystems Detailed information on accounts payable,
accounts receivable, payroll and other petty expenses.
Geographic Information systems
Capable of assembling, storing, manipulating and displaying geographically referenced information.e.g. Segmentation , Targeting, Water Consumption Ratio, Property Tax,
GIS FrameworkASK Acquire Examine Analyze Act
GIS Subsystems Measure (natural & human made
phenomenon) Store (measurements in digital format) Analyze (to create more useful information) Depict ( in form of maps, graphs, lists)
Case Study – Role of GIS in NHAI
Elements of Information Systems
Hardware Software Data People Procedures
Types of Information Systems TPS MIS DSS EIS KS
Note : Basically divided based on Strategic, Managerial & Operational levels.
Evolution of MISKS / ES
OAS
MIS
TPS
DSS
ESS / EIS AI
Information as a Strategic Resource
Achieving strategic competitiveness in the present competitive environment could be enhanced through capturing data, processing the same, analyzing & transforming into useable knowledge.
Contemporary Approaches to MIS
Technical Approach – Based on Operation Research techniques
Behavioral Approach – Based on user requirement/friendliness
Socio – Technical Approach - Combination
Use of Information in Competitive Advantage
Due to globalization business environment have become highly competitive and information - based. ”Competitive Advantage is about changing the balance of power between a firm and its competitors in the industry, in the firm’s favor”.
Case Study: IS in RestaurantCase Study: IS in SystemX
Porter – Miller IT affecting competition
Changes the Industry Structure Produces new business Creates competitive advantage by giving
companies new ways to out – perform their rivals.
Changes the Industry Structure
Bargaining power of customers Bargaining power of suppliers Threat from new entrants in the firm’s market Threat from substitute products or services Positioning of traditional industry competitors
Produces new business Information derived from the surveys and the
analysis of the same may lead to birth of a new business in the existing one. Thus information confers competitive advantage to the firm as it can offer a bundle of goods / services.
New ways to out – perform Functional Uses Strategic Uses
Decision Making Models Classical Model Administrative Models Herbert Simon Model Rational Decision Making
Bounded Vroom – Jago Six Step
Classical Model Decisions are in Best Interest of its
organization
Administrative Model Decisions are in Best Interest of the
Manager.
Herbert Simon Model
Phases – Intelligence, Design, Choice
Choice Design
Intelligence
Org
Rational Decision Making Bounded Vroom-Jago
5 processes and 7 questions AutocraticI(A1) – You AutocraticII(A2) – team you ConsultativeI(C1) – you – team ConsultativeII(C2) – team + you GroupII(G2) - team
Vroom-Jago Do you want High quality solution or best fit
solution? Is information gathered sufficient to take your
own decisions? Do you have structured problems? Do the members agreement towards the
towards is mandatory to accomplish a task? Will your group accept your decision? Chances of Disagreement from the group Goal Congruence (Mgr & Group)
Six-Step Model Define the problem Identify decision criteria Weigh the criteria Generate alternatives Rate each alternative Compute the ultimate option
Decision Analysis What If Analysis Sensitivity Analysis Goal Seeking Analysis – Goal Seek Goal Achieving Analysis - Scenarios
Decision Making Tools Decision Tree Decision Rule Decision Table Payoff Matrix Queuing Models
Decision Tree Decision Node – Initial Decision Point Chance Node – Options generated from
Decision Points
Decision Rule
List out all available options
Decision Tables
Tables may include both qualitative & quantitative bases for decisions based on the decision rules.
Payoff Matrix
Is a quantitative technique. It identifies the degree of likelihood of the occurrence of an event.EV – Expected value derived from possible consequences.
EV= prob (possibility1) + prob(possibility2)
Queuing Models Queue – Is a line of waiting customers who
require service from one or more service providers.
Queuing System – Waiting + Customers + Service Providers
Types of Queues Single – Channel, Single – Phase (Clinic) Single – Channel, Multiphase (Dual window) Multi – Channel, Single – Phase (Bank) Multi – Channel, Multiphase (Registration
Process) Parallel Single – Phase (Super Markets) Customer Discrimination (Insurance Co.) Converging Arrivals (Traffic Management)
Data Base Management Systems
DBMS Concepts
DBMS Components Transaction Management Concurrency Control Recovery Management Security Management Language Interface Storeage Management Database Catalog Management
Data Warehouse Every organization generates corpus data
from their day-to-day operations. Such data is considered to be the most powerful asset of the company.
The data collected in this way needs to be only in “update only” format.
For this activity the organization would require high end databases.
Data Warehouse
Data Warehousing is a new technology that provides the users the tools to store the summarized information from multiple, assorted databases in a single repository.A Data Warehouse is a Subject-Oriented, Integrated, Time-Varying, Non-Volatile collection of data.
Data Warehouse Structure
Data Warehouse Structure Data Marts are usually smaller chunks
extracted from Data Warehouse and focus on a particular subject or department.
Data Farm is a location all the data storing servers and other computer systems are placed.
Components/Elements of Data Warehouse
The major components of a Data Warehouse are:Source of Data Warehouse: (Transactional or Operational Database) from which the data warehouse is populated.Processes involved in creating a data warehouse:1.A process to extract data from the database, and bring it to data warehouse.
Components/Elements of Data Warehouse
2. A process to cleanse the data, to ensure its quality for decision making.3. A process to load the cleansed data into the data warehouse database.4. A process to create any desired summaries of the data like pre-calculated totals, averages etc which can be requested often.
Components/Elements of Data WarehouseMetadata: It is “data about data”. Query tools: include an end-user interface for asking questions to the database, in a process called On-Line-Analytical Processing (OLAP). They may also include automated tools called as Data Mining.Users: Finally, there is User or Users for whom the data warehouse exists and without whom it would be useless.
Data Warehouse Benefits Time Quantity & Quality Decision Making Business Processes Business Objectives
Note : Slice and Dice operations
Data Warehouse Tools Access Tools Retrieval Tools Database Reporting Tools Data Analysis Tools Data Mining Tools
Data Mining
“Data Mining” or “Knowledge Discovery Databases (KDD)”, is the non-trivial extraction of implicit, previously unknown and potentially useful information from the data.
Synonyms of Data Mining Knowledge Discovery in Databases (KDD Knowledge Extraction Data Analysis Information Harvesting Data Fishing, Data Dredging Data Archaeology Information Discovery
Need of Data MiningThe massive growth of data is due to the wide availability of data in automated form from various sources as Web, Business, Research etc. We are “Data Rich but Information Poor” Data is useless, if it cannot deliver knowledge. That is why data mining is gaining wide acceptance in today’s world. Data Mining is likely to emerge as an important managerial decision making tool.
Functioning of Data Mining
The cyclical functioning of Data Mining consists of the following:Understand the situationBuilding/Developing (suitable) model/sUndertaking analysis based on the model/sInitiating appropriate actionMeasuring the resultsIterations/Repetition
Technologies used in DataMining Decision rules Decision Trees Generic Algorithms Non-Linear Regression Methods – Dependencies
are checked Case Based Reasoning – Closest past similarities of
the present situation. Neural Networks: An Artificial Neural Network (ANN)
is an information processing paradigm that is inspired by the way biological nervous systems, such as the brain, process information.
Advantages of Neural Networks
Adaptive learning Self-Organization Real Time Operation Fault Tolerance via Redundant Information
Coding
Data Mining Applications Marketing Finance Human Resources / Personnel Manufacturing Services Retail
Data Mining – Banking Case
Customers apply for a loan / credit card. Information such as age, income, employment history, education, bank accounts, existing debts etc. is provided.The bank does further verification and further decides whether to issue the loan / credit card.
Trends affecting Data Mining
Grossman has identified five external trends which affect Data Mining. They are:Data Trends - avoid dumping of data. Hardware Trends – speedy processNetwork Trends – New protocols & languagesScientific Computing Trends - SimulationBusiness Trends - predict opportunities and risks
DSS DSS are interactive information systems, that
rely on an integrated set of user-friendly hardware & software tools to produce and present information that is targeted to support the management in the decision making process.
Components of DSS Database Model Base
Behavioural model Trend Analysis, Forecasting
Management Science Model PPM-OB (Budgets)
Operations Research Model Mathematics (MRP)
DSS Software System
Components of DSS ProgramModel Base
Model ManagementDialogue Management
Data Management
(DSS Database) (Enterprise Data) (External Data Source)
Types of DSS Status Inquiry Systems – Searching the
available vendors, products availability, procurement, stocks
Data Analysis System – Pricing, Promotional activities, positioning
Information Analysis System – selection of vendor/product/services based on price, performance, quality etc.
Accounting Systems – ROI, Payables, Receivables could be calculated
Decision Support Systems GDSS – User Interactive computer based
systems which facilitates the solution by set of decision makers in a group.
EIS / ESS – It can handle any type of new situations from which summaries/snapshots can be generated for assisting the top management in effective decision-making.
ES – Expert Systems are computer programs that represents the knowledge of some subject specialist with a view to solvig problems or giving advice.
Decision Support Systems KBES – Knowledge based expert systems
AI - Artificial Intelligence is a technology which helps the application of computers to the areas that require knowledge, perception, reasoning, understanding which distinguish the human behaviour from computers.
Issues in MIS
Security and Control – External Threats –
through internet connection without a firewall. Dial-up connections
Internal Threats Passwords Employee Discrimination Access Ids disclosed to unauthenticated user Authorization levels
Issues in MIS Quality Assurance – Quality indicates the
degree of excellence of a product or service. Factors:
Scale (Measurement Tool), Test (Implement), Worst (The least acceptable value) , Plan (Desired Values), Best (Best Fit value that a system is capable of), Now (the actuals derived)
Models : Quality Profile Model, Constructive Quality Model, TickIT Initiative
Issues in MIS Ethical and Social Dimensions Ethics means
system or code of conduct. Ethical & Social Dimension
Obligation to Management Obligation to Society Obligation to Employer Obligation to Country
Issues in MIS IPR in ITInformation or related products such as process, code ofconduct, business models, diagrams, layouts can be
classified as intellectual property which can be viewed, copied &
shared. In this process it may loose its original identity. Such information requires protection provisions from: 1. Trade Secrets,2. Copyright3. Patents Managing Global Information Systems
Issues in MIS
Managing Global Information Systems A Global Information Systems architecture consists of
basic information systems required by organizations to coordinate worldwide trade and other tasks.
A business driver is an environmental force to which businesses must respond and that influence a business’s direction
Global Information System
Application of MIS NHAI Hotel Information System HRIS eHRM Applicant Tracking Systems SystemX – Budgeting Tools ITES