Management Information System for BCA

INTRODUCTION TO INFORMATION SYSTEMS

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Management Information Systems

Management Information System Management

Art of knowing what you want to do and then seeing that it is done in the best and the cheapest way.

(Taylor) Functions: Planning, Organising, Staffing, Directing,

Controlling. Decision making is the fundamental Task.Job of MIS is to facilitate decision making.

Management Information System Information

Data Information:

Data have been put in to a meaningful and useful context is information.

Processed data. Corrects/ Confirms previous information. Has a surprise element/ news value.

Management Information System System

Set of elements joined together for a common objective. Subsystem is part of system. All systems are part of larger systems. Divisions, departments, functions, units etc. of

organisation. Concept of Synergism – Integration of subsystems

through information interchange.

A system that aids management in making, carrying out and controlling Decisions. [Jerome Kanter]

An integrated user-machine system for providing information to support operations, management, and decision making functions of an organisation.

[Davis and Olson]

Management Information System

Objective Decision Support System (DSS) To Provide information for decision making on

Planning, initiating, organizing and controlling the operations of subsystems of the firm.

To provide a synergistic organisation in the process. To Determine and provide what managers needs to

know as efficiently, effectively and economically as possible.

To facilitate accomplishment of objectives, and prevent failure to reach objectives.

Objectives Operational Control. Managerial Control. Strategic Planning. To help in decision making. To ensure co-ordination. To Save time and ensure economy. To ensure reliability and quality of work. To integrate systems. To avoid redundancy. To establish uniform procedures. To fix responsibility To improve services

System Approach 1960s. Synergism- sum of the parts is greater than the whole. Information system should be designed based on

synergy of subsystems. The approach of building information systems is

system approach.

Relevance of System approach The increased complexity of business Increased complexity of management

Increased complexity of business, because... The Technological revolution Research and development Product changes Information explosion

Increased complexity of Management, because... The theory of information feedback system Decision making Management Science Electronic computer

Features of a System Objective Components or Elements Entity Relationship Interdependence Structure Inputs Processing of Inputs Outputs Interactions Common Objective

Types of Systems Conceptual and Empirical Natural and Artificial Social and Machine Open and Closed Adaptive and Non Adaptive Probabilistic and Deterministic Permanent and Temporary Stationary and Non stationary Subsystems and Super systems

System View of Business Manufacturing System:

A group of people, machines and facilities, work to produce a specified number and types of products by operating on products specifications, schedules, raw materials, and electrical power converted to mechanical power.

Management Information system: A group of people and data processing equipments

select, store, process an retrieve data to reduce the uncertainty in decision making.

Business Organisation System: A group of people gathers and processes material and

informational resources toward a set of common goals including an economic profit of the business by performing financing, design, production and marketing.

MIS organisation within the company Location of MIS in the organisation structure Common- under VP of Finance MIS reporting to President

Organisation within the MIS function Steering committee

MIS Manager Sales Manager Production Manager Finance Manager

Design Project team composed of representatives from

functional areas plus technical system people

Management, Organisational Theory and System Approach Management existing from the beginning of society Management of social groups With development of science and Technology,

management gained importance Started investigating management process Companies attempt structuring organizations Structuring function performed by managers.

Management, Organisational Theory and System Approach Manager influences organisation to work cooperatively As organisation grow, complexities also grow Industrial Revolution Manager must be satisfied with Information Flow MIS designed on the basis of management tasks,

management principle, Managers’ style and behaviour and organisational structure and behaviour

Development of Organisational Theory Management theory deals with theories of how to

achieve organisational objective Relatively older Organisation theory concerned with structure of

interpersonal relationship and views organisation as a mechanism for promoting human collaboration

New discipline Based on Bureaucratic model by Max Weber

Organisational Theory More Prevalent models of organisation theory:

Classical Process Theory Bureaucracy Theory Behaviorial Theory Decision Theory Social Systems Theory System Theory

Classical Process Theory Contributors:

Fayol Taylor L.Gullick and Urwick Mooney

1930s Mooney with Book “Principles of Organisation” Process of Managing ‘POSDCORB’ Clear Lines of Authority Specialisation of Labour Unity of Command Span of Control Clear separation of Line and Staff

Classical Process Theory [Contd..] Given the objective to be accomplished, determine the

work to be done, group the work into logical units, define positions and accountability.

Form Organisation chart with position description of duties.

Work will be done if everyone follows organisation structure

Assumed: Workers are logical and perform as expected Workers prefer to have their job limits clearly defined

Merits of Classical Theories First theories Provided framework for

later Made aware of basic

organisational problems Many principles are valid

even today Provides for education

and training of management

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Demerits of Classical Theories Organisations were stable

and simple. Employees were viewed as

tools. Focus on jobs rather than

people. Monetary rewards were

more important. Initiative and creativity

were ignored. Principles are not

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Bureaucratic Management/ Bureaucracy Theory Bureaucracy! How an entire

organisation should operate!

Designing the ideal type of organisation.

Most efficient form for a complex organisation

Max Weber

Merits Increase efficiency and

consistency Optimum utilisation of

HR Uniformity of operations Equal treatment to all Large organisations

Demerits Rigid Rules & Procedures Slow Decisions Limit personal skills No informal

organisations Difficult in control and

co-operation Protecting authority

rather than increasing productivity

Behaviour approach• No positive response for Scientific Management• Modification to classical theory (Neo-classical)• Organisation is a social system and human factor is most

important.• Importance of human relations and human value• The ways in which the managers interact with the society.• Leadership/ human resource approach/ organisational

behaviour approach• Interdisciplinary approach• Motivation, leadership, communication, group dynamics…• Emphasis on participative decision making

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Behaviorial Theory Hawthorne Experiments (1927-

1932) Hawthorne effect — workers’

attitudes toward their managers affect the level of workers’ performance than technical and Physical environment.

Elton Mayo F.J Roethlisberger

Decision Theory Management is essentially decision making. The members of organisation are decision makers and

problem solvers. The importance of members are determined by the

importance of their decisions. Quality of decisions affect the organisational

effectiveness. MIS, process and techniques are subject matter of

study.

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Contributors and criticisms Herbert Simon Chester Barnard James March Richard Cyert Forrester

Limited scope. No total view of Management

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Vilfredo ParetoChester BarnardAn organisation is essentially a cultural system composed

of people who work in co-operation.For achieving organisational goals, a co-operative system

can be developed by understanding the behaviour of people in groups.

Relationships exist among the external as well as internal environment of the organisation.

For effective management efforts should be made for establishing harmony between the goals of the organisation and the various groups therein.

Social systems approach

System is combination of parts, subsystems. Subsystems are mutually related to each other. Interdependent subsystems and synergy. System has boundary- to relate with environment. Closed system and open system. System transforms inputs into outputs. Developed by Kenneth Boulding, R.A Johnson, Rosen

Zweig…

System Theory of Organisation and Management

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Social system Open system Adaptive system Dynamic System Probabilistic System, not deterministic Multidimensional system Multivariable system

Management as a system

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Theoretical and vague. Lacks universality. Not specifying interactions and

interdependencies.

Criticisms

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anishgeorge37

Management and Organisational Behaviour Managing HR is difficult Structuring Organising Workers participation Productivity affected by Motivation, Managerial

leadership, Organisational behaviour, Govt regulation, Innovation, Technology etc.

Motivation Behaviour of people All people are equal, but some are more equal than

others. Behavioural differences Physical differences Mental capabilities Life experiences Culture Behaviour changes over time

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Definition of motivation:

* The driving force within individuals by which they attempt to achieve some goal in order to fulfill some needs or expectation.

* The degree to which an individual wants to choose in certain behavior.

Motivation is…

ComplexPsychologicalPhysical Unique to each and every personContext sensitiveNot fully understood

Basic model of motivation

Needs or expectations

Result in Drive force(Behavior or

Action)

To Achieve

Desired Goals

Which Providesfulfillments

Feedback

Needs models of Motivation Needs are motivators. Satisfied needs are not. Incentives to achieve needs. Hierarchy of Needs – A.H Maslow Two Factor Theory- Herzberg Achievement model- McClelland

Need Hierarchy According to Maslow, human behavior is related

to his needs. It is adjusted as per the nature of needs to be satisfied.

Maslow identified five types / sets of human need arranged in a hierarchy of their importance and priority :

1. Physiological Needs2. Security / Safety Needs3. Social /Love Needs4. Esteem Needs5. Self-actualization Needs

*Lower order ( External ) : Physiological and safety needs

*Higher order ( Internal ) : Social, Esteem, and Self-actualization

Individual must satisfy lower-level needs before they can satisfy higher order needs.

Motivating a person depends on knowing at what level that a person is on the hierarchy.

Herzberg’s two factor theory Job satisfaction and job dissatisfaction are created by different

factors.Hygiene factors- Extrinsic ( Environmental ) factors that

create job dissatisfaction.Motivation Factors- Intrinsic ( Psychological ) factors that

create job satisfaction.

Attempted to explain why job satisfaction does not result in increased performance

The opposite of satisfaction is not dissatisfaction but rather no satisfaction.

Hygiene factors avoid job dissatisfaction

• Company policy & administration

• Supervision• Interpersonal relations• Working conditions• Salary• Status• Security

• Achievement• Achievement recognition • Work itself• Responsibility• Advancement• Growth

Motivation factors increase job satisfaction

McClelland’s Need Theory

Need for Achievement

The desire to excel and succeed

Need for Affiliation –

The desire for interpersonal relationship

Need for Power –

The need to influence the behavior of others.

Expectancy Models of Motivation• Victor H Vroom, Lyman Porter and Edward Lawler.• Motivation depends on strength of an individual’s

desire for a set of goals.The theory states that individuals have different sets of

goals and can be motivated if they believe that:

1. There is a positive correlation between efforts and performance.

2. Favorable performance will result in a desirable reward.

3. The reward will satisfy an important need

Motivation

Expectancy

• The belief that higher or increased work effort will result to better performance or completion of a task.

Instrumentality

• The perception of the person that if he or she /person performs well, a desired outcome will result from it.

Valence

• This refers to the person’s emotional orientation to the value of the outcome or rewards that were brought about by the person’s effort to the performance shown.

What the management should do?

• The management must know what supervision, trainings or resources the employees need.

• The management must ensure that promises of rewards are fulfilled and that the employees are made aware of that.

• The management must know the employees value.

Management, Information and the System Approach

• Tasks of management– Match the capabilities of institution to various

needs of the environment.– Establish work environment and allocation of

resources for maximum productivity.– Manage responsibilities to stakeholders

• Get ready to do something.• Forecast the future.• Deciding in advance what to do, how to do,

when to do and who is to do it.• Bridges the gap from where we are, to where

we want to go.

Planning

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• Intellectual process• Planning is an integrated process• Planning is Continuous• Selective process• Dynamic process• Focused on objectives• Primacy of planning• Planning is Pervasive• Future oriented• Planning leads to efficiency• Makes control effective

features

• Without plans actions are producing chaos.• To achieve organisational objectives.• Growing complexities and competitions.• Rapid social, economic and political changes.• Social Responsibilities.• Uncertainties caused by business cycle.• Scarcity of resources.• Increasing govt. control.• R&D activities.

Is it necessary?!

• Corporate level Plans /Strategic/ Long term plans

• Department level plans/ Tactical/ short term plans

Types of Plans

• Analyse the environment• Identify company strengths and weaknesses• Consider personal values of top management• Identify opportunities and risks• Define product/market scope• Define the competitive edge• Establish objectives and measures of

performance• Determine deployment of resources

Information and Planning• Environmental Information

– Political and governmental– Demographic and social trend– Economic Trend– Technological Environment– Factors of production

• Competitive information– Industry demand– Firm demand– Competition

• Internal Information– Sales forecast– Financial plan– Supply factors– policies

Organising

• Process of identifying and grouping the work to be performed, defining and delegating responsibility and authority and establishing relationships for the purpose of enabling people to work most effectively together in accomplishing objectives. – Luis A. Allen.

• It is grouping of activities necessary to attain enterprise objectives and assignment of each group to a manager, with authority necessary to supervise it.- Koontz and O’Donnell.

Process of Organising

• Identification of activities• Division of work• Grouping of activities• Assigning activities• Defining authority and responsibility• Co-ordination

Importance

• Facilitates administration.• Facilitates growth and diversification.• Ensures optimum use of human resources.• Stimulates creativity.• Facilitates stability of enterprise.• Ensures optimum use of resources.• Effective control.• Avoids duplication of work.

Information and Organising• Organisation structure is human

anatomy and information is nervous system.

• Each organisation entity is an information system with the components of input, processor and output.

• Each is connected to others through information and communication channels

• Each organisational entity becomes a decision point.

• Organisation must be designed around information flow

• Information needed for planning and implementation of organising.

• Information needed to manage change

Staffing

• Process of obtaining and maintaining capable and competent people to fill all positions from top management to operative level.

• Process of acquiring, developing, appraising, remunerating and retaining people so that right type of people are available at right positions and at right time in the organisation.

Importance

• Filling organisational positions• Developing competencies• Retaining personnel• Making other functions effective• Increasing the productivity• Builds sound organisation• Activates organisation• Ensures effective utilisation of HR

Directing

• Direction consists of the process and techniques utilized in issuing instructions and making certain that operations are carried as originally planned.

Directing involves…..• Telling people what is to be done

and explaining how to do it. • Issuing instructions and orders to

subordinates.• Inspiring them to contribute

towards the achievement of objectives,

• Supervising their activities; • Providing leadership and

motivation

ELEMENTS OF DIRECTION

• Communication• Leading• Motivation• Supervision• Coordination

Controlling

• Evaluating the actual performance and if necessary, taking corrective actions so that the performance is in accordance with planned performance.

• End function.• Continuous process.• Closely related with planning.• Forward looking process.• Pervasive function.

Pre-requisites of control system

• Planning.• Action.• Delegation of authority.• Flow of information.

Process of Control

• Establishing of standards.• Measurement of actual performance.• Comparing the actual performance with the

standards.• Taking corrective actions.• Feedback.

System Theory & System Approach

• Organisations being a system are complex entities with multiple relationships.

• System is composed of many subsystems and relationships existing among them.

• System explained as a whole. It is more than sum of its parts (holism/synergism)

• System and subsystems form a hierarchal structure.

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• The parts of the system constitute an indissoluble whole, so that no part can be altered without affecting other parts.

• The subsystem should work toward the goal of their higher system and not pursue their own objectives.

• The nature and functions of the part are derived from its position in the whole.

• Behaviour of the part is regulated by the whole to part relationships

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