MC0076 Set1

8/2/2019 MC0076 Set1

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MCOO76 - Management Information Systems –

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1. What do you understand by Information processes data?

Data are generally considered to be raw facts that have undefined usesand application; information

is considered to be processed data thatinfluences choices, that is, data that have somehow been

formatted, filtered, and summarized; and knowledge is considered to be an understanding derived

from information distinctions among data, information, and knowledge may be derived from

scientific terminology. The researcher collects data to test hypotheses; thus, data refer to

unprocessed and unanalyzed numbers. When the data are analyzed, scientists talk about the

information contained in the data and the knowledge acquired from their analyses. The confusion

often extends to the information systems context, and the three terms maybe used interchangeably.

The acquisition of information is a first step in its use. We can obtain information from either formal

or informal sources. Formal sources provide information in a relatively organized and predictable

fashion, for example, business forms; electronic monitoring equipment such as digital

thermometers; and machine-readable purchased data such as an encyclopedia (Personal records,

corporate annual reports, summarized transaction histories) on a compact disc. Informal sources

provide information in a less structured way and include conversations with customers, suppliers,

and other employees, as well as general observations of personal and organizational activities.

Generally, acquiring information through informal sources costs less, but the information acquired

may be harder to organize and use effectively. Data acquisition can occur manually or electronically.

Managers often hand-write evaluation reports or salespeople maintain written records of customer

orders. Increasingly, managers can enter evaluation data directly into the computer, and salespeople

can use point-of-sale terminals to record detailed sales information electronically. Experts estimate

that electronic forms for capturing data cost at least 70 percent less to design, purchase, use, carry,

and revise than the equivalent paper forms.

Processing information describes transforming it into a usable form. Processing typically occurs at

two times: first, between the acquisition and storage of information, and second, between its

retrieval and communication. The processing that occurs between acquisition and storage generally

requires a large amount of personal labor. Manual processing, involves duplicating, sorting, and

filing data. Electronic processing, such as with electronic scanners, involves transforming and

entering the data into an electronic form. Although both manual and computerized processing may

require significant clerical time and incur high costs, electronic processing can reduce these costs.

Processing occurs between storing and communicating information for both manual and

computerized systems. In manual systems, filing clerks typically perform the processes of retrieval,

formatting, and display. When summaries or special analyses are required, analysts with specialskills, such as skills in finance or accounting, may process the data. Manual information processing

involves high labor and time costs but low equipment costs. Manual processing of large volumes of

data tends to be more expensive than computer processing. In computerized systems the processing

between retrieval and communication allows more analysis and display possibilities in a shorter

time. The costs of computerized processing include rental or depreciation of computer equipment,

the labor costs of operating the equipment, and the costs associated with programming software to

retrieve, format, and display information.

Computerized processing involves lower labor and time costs but higher equipment costs than

manual processing.

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2. How do you retrieve information from manual system?

Retrieving desired data from manual systems can be time consuming and expensive. Executives

spend approximately six weeks a year on average looking for misplaced material. Secretaries may

spend as much as 30 percent of their time looking for paper documents and approximately 20

percent of that time searching for misfiled items.

Manual transmission of information occurs frequently and easily in most organizations. Most

organizational members rely on face-to-face communication in formal or informal setting or on

written publications for much of the information they require to do their jobs. But face-to-face

communication requires ‘extensive amounts of time, a scarce resource in most organizations.

Written media, such as memos, reports, advertisements, or other document can effectively transmit

small amounts of information to large numbers of people. Transmitting information long distance or

exchanging large volumes of data can occur more effectively by electronic communication.

Telephone, television, videoconferencing, fax or other electronic data transmission can

instantaneously establish communication in among individuals, groups, organizations, or data

repositories or each unit of information transmitted, electronic media are much less expensive than

written or oral media.

3. What are the challenges of information management?

In identifying their information management requirements, individuals face four major challenges in

addition to securing the most appropriate information. First, they must deal with large quantities of

information that may create overload. Second, they may face insufficient or conflicting information.

Third, they must find ways to enhance their personal productivity. Fourth, they must acquire and

maintain the technical skills needed for effective personal information management.

Dealing with Quantities of Information

The gap between the amount of information that an organization can collect and the ability of its

employees to make sense of that information has been widening rather than narrowing. The early

fear that computers would so improve a person’s ability to process and manage information that a

job holder would need only one-third to one-half the time to do his or her job has been dispelled he

reverse has occurred. Often employees face an infoglut, an overload of information. As individuals

move higher in the organizational hierarchy and assume more managerial responsibility, information

overload become an even more significant challenge. To avoid such overload individuals must

carefully asses their information needs and then find effective ways of managing the required and

available information. They must also find ways to manage data better.

Facing Insufficient or Conflicting Information

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Although compute rs can make large quantities of information available to individuals, such

information may not address their needs. Ramesh, ASM of Airtel, may wish to do some library

research about com petitors’ products. In spite of the large amount of information in the library’s

electronic catalog, she may not be able to secure the precise information she needs. Because

computers process input from diverse sources, users may also obtain conflicting information if one

source updates information more frequently than another does.

Enhancing Personal Productivity

Employees in any organization increasingly use information technology to improve their personal

productivity. To ensure high productivity, employees must know how to use computers to facilitate,

not hinder, their performance. They must know how to access the information they require and

recognize when manual data collection and processing is adequate. Often employees must lobby

their employers to add new technology that will help increase personal productivity. The ability to

show the cost-effectiveness of additional expenditures for diagnosing and meeting information

needs is critical. Employees must also understand and demonstrate when advanced technology is a

detriment rather than an asset.

Maintaining Technical Skills

Finally, using information technology effectively requires continuous updating of technical skills.

Although many companies provide training to their employees, others do not. Ensuring that

employees have the appropriate skills has both financial and time cost implications. As a result,

employees may find their mobility and productivity limited by the extent to which they can learn

new technical skills independently of their employer

4. Explain the different components of MIS.

In our broad interpretation of the MIS concept, these information systems include all of the

following:

· Transaction processing systems for operational data processing that are needed, for example, to

register customer orders and to produce invoices and payroll checks.

· Management reporting systems capable of producing reports for specific periods, designed for

managers responsible for specific functions in a firm.

· Decision support systems (DSS) expressly designed for the support of individual and collective

decision making.

· Executive information systems, which support the work of senior executives and of company

boards by giving them ready access to a variety of summarized company data against a background

of general information on the industry and the economy at large.

· Office information systems, which support and coordinate knowledge work in an office

environment by handling documents and messages in a variety of forms-text, data, image, and voice.

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In a broader sense, knowledge work is also supported by computerized systems assisting

professionals in non-managerial functions. For example, diverse professional support systems help

designers, such as engineers, architects, commercial artists, or scientists who model molecular

structures or study the genetic codes of living matter.

5. Mention different characteristics of MRS.

1) MRS are usually designed by MIS professionals, rather than end users, over an extensive period

time, with the use of life-cycle oriented development methodologies (as opposed to first building a

simpler prototype system and then refining it in response to user experience). Great care is

exercised in developing such systems because MRS is large and complex in terms of the number of

system interfaces with various users and databases.

2) MRS is built for situations in which information requirements are reasonably well known and areexpected to remain relatively stable. Modification of such systems, like their development, is a

rather elaborate process. This limits the informational flexibility of MRS but ensures a stable

informational environment.

3) MRS does not directly support the decision-making process as a search for alternative solutions to

problems. Naturally, information gained through MRS is used in the manager’s decision-making

process. Well-structured decision rules, such as economic order quantities for ordering inventory or

accounting formulas for computing various forms of return on equity, are built into the MRS itself.

4) MRS is oriented towards reporting on the past and the present, rather than projecting the future.

5) MRS generally has limited analytical capabilities-they are not built around elaborate models, but

rather rely on summarization and extraction from the database according to given criteria. Based on

simple processing of the data summaries and extracts, report information is obtained and printed

(or, if of limited size, displayed as a screen) in a prespecified format.

6) MRS generally report on internal company operations rather than spanning the company’s

boundaries by reporting external information.

6. List down the Potential External Opportunities, potential internal Weaknesses.

Corporate level strategy addresses which lines of business a company should pursue. It views an

organization as a portfolio, agglomeration, federation, or amalgam of businesses or sub units.

Strategic management at the corporate level focuses on decisions about acquiring new businesses,

divesting old businesses, establishing joint ventures, and creating alliances with other organizations.

Determining its corporate-level strategy requires top management to obtain information about

business growth rate-the speed of industry growth-and market share-the portion of the industry

market captured by the business unit, among other information. Information on industry growth and

market share is often public, due to the disclosures required of companies issuing stocks and bonds.Industry lobbyists, stock market researchers, trade magazine journalists, and other researchers also

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act as sources of this information. Information systems can regularly provide organizations with such

information by tapping into commercially sold databases that offer extensive economic,

technological, demographic, and even legal information. This ongoing availability of information

allows organizations to determine their strategic position as well as the appropriate actions for

maintaining or changing this position. Information systems can provide the information for making

resource allocation and other investment decisions. Information about market share, profit margins,

patent ownership, technical capability, competitive strengths and weaknesses, quality of the

management team, ability to compete on price and quality, customer requirements, and markets

helps management determine its investment strategy. For example, business units with high ratings

on both industry attractiveness and business strength make good financial investments; those low

on both dimensions have no growth potential, and managers should consider divesting or liquidating

them. Strategic management also involves business-level strategy, matching the strengths and

weaknesses of each business unit or product line to the external environment to determine how

each unit can best compete for customers. Strategic decisions include what products or services the

company should offer, what customers it should service, and how it will deploy resources foradvertising, research and development, customer service, equipment, and staffing.

Potential External Opportunities

Serve additional customer groups

Enter new markets or segments

Expand product line to meet broader range of customer needs

Diversify into related products

Vertical integration

Falling trade barriers in attractive foreign markets

Complacency among rival firms

Faster market growth

Potential Internal Weaknesses

No clear strategic direction

Obsolete facilities

Lack of managerial depth and talent

Missing key skills or competence

Poor track record in implementing strategy

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Plagued with internal operating problems

Falling behind in R&D

Too narrow a product line

Weak market image

Weaker distribution network

Below-average marketing skills

Unable to finance needed changes in strategy

Higher overall unit costs relative to key competitors

7. What are the technology evaluation factors that need to be considered during ERP

selection.

The major technology evolution factors that needs to considered while ERP selection are,

Is the technology robust enough to handle current and future transactions load? Is it scalable?

- Is the system’s speed acceptable for daily usage?

- Is source code provided for customisations or modifications without hefty charges?

- Do customisations hamper upgrading to future software releases?

- Is the software Open Database Connectivity (ODBC) compliant?

- Does the software support eCommerce, Radio Frequency (RF) and bar coding, and Electronic Data

Interchange (EDI) transactions?

- Does the software support multi-company, multi-division, and multi-currency environments? Are

there any restrictions to this type of environment?

8. What are the common business exposures and risk of using internet by organization.

Contracting viruses

· Interception of passwords by hackers

· Interception of sensitive/commercial data

· Illegal/objectionable use of site by users

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· Inability to effectively disconnected Internet to own employees

· Misrepresentation of identity by site visitors

· Legal loopholes in electronic contracts

· No security against eavesdropping

· No security against interception

· Misuse of supplied/captured information

· Misrepresentation of identity of site

9. Explain with relevant example the concept of business process. Also mention their

elements.

The business process is defined as ‘a set of activities performed across the organisation creating an

output of value to the customer’. Every process has a customer who may be internal or external to

the organisation. The scope of the process runs across the departments and functions and ends up in

substantial value addition which can be measured against the value expectation of a customer.

For example, the order processing scope in the traditional sense is within the marketing department.

But when it comes to re-engineering, the scope expands to manufacturing, storing, delivering andrecovering the money. Likewise, the scope of the bill payment is not limited to the accounts and

finance departments but it covers ordering the vendors, receipt and acceptance or goods and paying

the bill amount.

In a classical organisational set-up, the different processes are handled in parts within the four walls

of the department and the functions are limited to the responsibility assigned to them. When the bill

payment process is to be re-engineered, it will be re-engineered right from the purchase ordering to

cheque payment to the vendor. The reason for covering the purchase ordering as a part of the bill

payment process, is that the purchase order information decides the number of aspects of bill

payment.

The basic element of the processes is motivation to perform certain activities. In the process

execution, the data is gathered, processed and stored. The data is used in the process to generate

the information which would be checked, validated and used for decision making. The decision is

then communicated. The process is executed through the basic steps such as receiving the input,

measuring the input, analysing the document, performing, processing, recording, accessing data,

producing the results and communicating them.

Basic elements of business process are:

· Motivation to perform

· Data gathering, processing and storing

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· Information processing

· Checking, validating and control

· Decision making

· Communication

10. Explain the link between MIS and BPR.

Any exercise towards building design of the management information system will be preceded by an

exercise of business process re-engineering. Building the MIS is a long-term project. It is, therefore,

essential to have a relook at the organisation where the mission and goals of the organisation are

likely to be replaced. The business itself would undergo a qualitative change in terms of the businessfocus, work culture and style and the value system. This would change the platform of business

calling for a different MIS.

The MIS will concentrate more on the performance parameter evaluation which is different in the

re-engineered organisation. The data capture, processing, analysis and reporting would be process

central and performance efficiency would be evaluated in relation to the value generated by the

processes.

The decision support systems will be integrated in the business process itself, where triggers are

used to move the process. The triggers could be business rules and stored procedures, enabling the

process to become automotive in its execution. The MIS in the re-engineered organisation would be

more of a performance monitoring tool to start with and then a control for the performance. The

traditional MIS is function-centered like finance, production, material, etc. The Management

Information System in a re-engineered organisation would be process centred, evaluating customer

satisfaction, expectations and perceptions.

The role of Management Information System will be raised to a level where the following activities

would be viewed for the management action:

· Control of process cycle time

· Work group efficiency

· Customer satisfaction index

· Process efficiency and effectiveness

· Effectiveness of the Management in enterprise management and not in enterprise resource

· The strength of the organisation in terms of knowledge, learning and strategic effectiveness

The traditional role of the MIS as a decision supporter will continue, however

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Part 2

Explain the needs for information in the following areas

a) Cost leadership b) Global corporation

c) ERP architecture d) Technology Evaluation Factor

Cost Leadership

Cost leadership strategy seeks to achieve competitive advantage by allowing the business unit to

make more profit than its competitors when selling to customers at the same price. Complete

information about costs makes costs easier to control and creates a competitive advantage. The

company requires quality internal information to reduce costs by achieving efficiencies in

production, distribution, and sales. Even hospitals can use information technology to reduce costs byeliminating paperwork and improving services. Bedside terminals can store patient records;

electronic conferencing can bring the expertise of a team of physicians in remote locations to a

single problem; home health terminals allow patients to consult with doctors online; and diagnostic

systems can support physicians’ diagnoses, identify preferred treatments, and specify their cost

benefits.

Global Corporation

A global corporation has rationalized its international operations to achieve greater efficiencies

through central control. Although its strategy and marketing are based on the concept of a global

market, a headquarters organization makes all major decisions. A company pursuing a global

strategy needs to transfer the operational and financial data of its foreign subsidiaries to

headquarters in real time or on a frequent basis. A high level of information flows from subsidiary to

parent, while limited data move from parent to subsidiary.

ERP Architecture

Any information system has three basic components, viz., the Data Management, the Application

Logic, and the Presentation. These components can be built with the client server role definitions.

The client is a user and the server provides the services required by the user them to run the system.

Since, the information needs are dynamically changing, the architecture required is to separate the

data and its management from its application. The user requires the choice of using the data as it

suits him the most. Hence, the application logic has to be separate from the data. There is also

variability in the manner how the application logic is developed and presented. The architecture

could be a two tier or three tier as shown below.

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Since, the ERP is a generic solution for the business operations, in each case of implementation,

customization should suit the specifics of the business or customer. The architecture choice is

influenced by this requirement. In a two-tier system architecture, there is a rigid division of roles.

The data management is by the server and its processing is through the application logic by client. In

this architecture all the requirements are sent to the server by all the users in the network. This

affects the load on the server and the response time to the user increases. However, there could

bean application which deals with high volume and complex data structure and this approach is

more efficient, if response issue is taken care of by the high end multiple CPU and the parallel

processing hardware platforms. There could be a case where the user is dumb and is required to use

the system in a guided manner with the ‘help’ assistance. Then the three tier architecture is suitable.

The client uses the GUI(Graphical User Interface) tools for simplicity while the application logic is

processed on another machine. In this architecture three distinct roles are defined and three

hardware platforms are made responsible to perform. The servers play two distinct roles of handling

the data and the applications logic. This architecture is useful when there is not much change in the

application logic and it is complex. Further, this architecture is useful when the user does not want

to change the application logic but may want to change the presentation logic. The third possibility is

a golden mix of the two architectures. Here the application logic is split into two. The logic which

deals with the data more is attached to the server platform, where the data is being managed. The

logic, which deals with the presentation and the specific needs of the user, is left to the client

platform as shown bellow.

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Technology Evaluation Factor

1) Client server architecture and its implementation-two tier or three tier.

2) Object orientation in development and methodology.

3) Handling of server and client based data and application logic.

4) Application and use of standards in all the phases of development and in the product.

5) Front end tools and back end data based management system tools for the data, process

presentation management.

6) Interface mechanism: Data transfer, real time access, OLE/ODBC compliance.

7) Use of case tool, screen generators, report writers, screen painter and batch processor.

8)Support system technologies like bar coding, EDI, imaging, communication, network.

9) Down loading to PC based packages, MS-Office, lotus notes, etc.

10) Operating system and its level of usage in the system.

11) Hardware-software configuration management

2. How information is selected and organized?

The Components of Perception

Perception is an active process by which an individual attends to certain stimuli and then organizes

them in a meaningful way. Individuals attend to certain features of a situation or select specific

pieces of information to see or hear because of their needs, personality, or experiences. The

information itself may also influence whether attention occurs: Individuals select stimuli that are

more intense, repetitive, in motion, novel, very familiar, or in contrast with their background. People

tend not to see information that they are exposed to repeatedly without consequence. Try to recall,

for example, the pictures and shapes on the back of a five hundred rupee note. In addition, people

tend to ignore information that runs counter to deep or long held beliefs. Consider why companies

such as IBM or Dig ital Equipment Corporation failed to recognize the changing nature of the

computer market in the late 1980s. Clearly, the subjectivity of perception limits the processing of

information. Once individuals attend to information about a situation, they organize it in several

ways. They may try to fit it into prototypes or categories that represent typical aspects of similar

situations. They may match it to concrete examples. They may view it against a background, for

example, within an environmental or situational context. Finally, they may group stimuli into

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patterns, trying to form a complete picture, sometimes even trying to do so using incomplete

information.

An understanding of how people select and organize information is critical to designers of information systems. Managers rely on information systems to collect and summarize data about

their organization, so systems designers must present information in ways that have the greatest

chance of being seen and remembered to ensure that users select the most important information

and organize it in the most effective way. Extensive research in information systems has addressed

questions such as how much information to put into a single table, what type of data to present as

tables and what type as charts, and how best to use color to convey information and facilitate

quality decisions. Managers and other jobholders also have a responsibility to ensure that they

receive and select the information they need in order to operate effectively. Some managers may

receive insufficient information for decision-making; others obtain so much information that they

cannot separate the important from the unimportant. Individuals who hold jobs that require

extensive coordination with other jobholders, as well as those who have a high ability and desire to

communicate more frequently, experience overload more than those who do not. This overload can

be particularly problematic: Decision quality declines as the amount of relevant information

increases beyond a manageable limit.

Humans versus Computers

Humans and computers are complementary in their ability to filter and save information. Humans

can effectively decide what is important; computers cannot. Computers generally can retain much

more information and collect it faster than humans collect. For example, computers at stores such asBig Bazaar can maintain a complete, instantaneous, accurate inventory on the thousands of items in

a store; manual tabulation by a store clerk would take weeks. In addition, computers often process

information more accurately than individuals do. Marine biologists obtain the information they

require by counting fish, checking maps, and diagnosing equipment flaws under water; under water

personal computers could make the data collection easier. People can think easily in terms of

symbols, objects, and concepts that have meaning

They can draw conclusions from data. Increasingly computers are able to think in this way, but they

still have only a primitive ability to draw conclusions. Although physicians can use computer

programs to help organize disparate symptoms into a pattern that assists with diagnosis, fewpatients would want a computer acting alone to treat their life-threatening disease. Computers can

perform computations much more quickly and accurately than people can: They can add a column of

50 ten-digit numbers in less than a second, whereas such addition would take even the most facile

individual several minutes. They can sort a list of one million addresses by ZIP code to prepare

envelopes for bulk mailing; to do so manually in a timely fashion would take hundreds of people.

3. Briefly explain components of MIS.

The physical components of MIS comprise the computer and communications hardware, software,

database, personnel, and procedures. Almost all organizations employ multiple computer systems,

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ranging from powerful mainframe machines (sometimes including supercomputers) through

minicomputers, to widely spread personal computers (also known as micro computers). The use of

multiple computers, usually interconnected into networks by means of telecommunications, is called

distributed processing.

The driving forces that have changed the information processing landscape from centralized

processing, relying on single powerful mainframes, to distributed processing have been the rapidly

increasing power and decreasing costs of smaller computers.

Components Description

Hardware Multiple computer systems: mainframes, minicomputers, personal

computers Computer system components are: central processor(s),

memory hierarchy, input and output devices Communications: local

area networks, metropolitan area networks, and wide area networks

Software Systems software and applications software

Database Organized collections of data used by applications software

Personnel Professional cadre of computer specialists; end users in certain

aspects of their work

Procedures Specifications for the use and operation of computerized information

systems collected in user manuals, operator manuals, and similar

document

4. Explain with relevant examples the ascertaining the class of information need for the business

execution.

Ascertaining the information needs of the management for the business execution is a complex task.

The complexity can be handled if the information is classified on the basis of its application and the

user, which becomes the basis for the ascertainment. The classification could be as shown in table

below.

Class Example of information User

Organisational The number of employee’s. products, services,

locations, the type of business ,turnover and

variety of the details each of one of these

entities.

Many users at all the

levels

Functional Purchases, sales. production, stocks.

receivables, payables, outstanding, budgets,

statutory information.

Functional heads

Knowledge The trends in sales, production technology.

The deviations from the budgets, targets,norms etc. Competitor s information, industry

Middle and-the Top

Management

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and business information plan performance

and target; and its analysis.

Decision support Status information on a particular aspect, such

as utilisation, profitability standard,

requirement versus availability. Information

for problem solving and modelling.Quantitative information on the business

status. Non-moving inventory, overdue

payments and receivables.

Middle Management

and Operations

Management.

Operational Information on the production, sales.

Purchase, despatches consumptions, etc. In

the form of planned versus actual. The

information for monitoring of execution

schedules.

Operational and

Management Supervisor,

Section officer

5. How do you define Management Reporting Systems?

Management reporting systems (MRS) are the most elaborate of the management-oriented MIS

components. Indeed, some writers call MRS management information systems, the name we

reserve for the entire area of informational support of operations and management. The main

objective of MRS is to provide lower and middle management with printed reports and inquiry

capabilities to help maintain operational and management control of the enterprise.

6. Explain with relevant examples the concept of business process. Also mention their elements.

For initiating business re-engineering, one is required to make some very basic and fund a- mental

changes in one’s conventional thinking. The business is re-engineered through process re

engineering and the business has a number of processes which together produce the business

results. You concentrate on the ‘process’ and not on the task when it comes to re- engineering. The

business process is defined as ‘a set of activities performed across the organisation creating an

output of value to the customer’. Every process has a customer who may be internal or external to

the organisation. The scope of the process runs across the departments and functions and ends up

insubstantial value addition which can be measured against the value expectation of a customer. For

example, the order processing scope in the traditional sense is within the marketing department.But when it comes to re-engineering, the scope expands to manufacturing, storing, delivering and

recovering the money. Likewise, the scope of the bill payment is not limited to the accounts and

finance departments but it covers ordering the vendors, receipt and acceptance or goods and paying

the bill amount.

Basic elements of business process are:·

Motivation to perform

Data gathering, processing and storing

Information processing Checking, validating and control

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Decision making

Communication

7. What are the uses of Executive Information Systems?

Executive information systems (EIS) provide direct support for top managers. Characteristically,

senior managers employ a great variety of informal sources of information, so that computerized

information systems are able to provide only limited assistance. However, the chief executive

officer, senior and executive vice presidents, and the board of directors also need to be able to track

the performance of their company and of its various units, assess the business environment,and

develop strategic directions for the company’s future. In particular, these executives need a great

diversity of external information to compare their company’s performance to that of its competition,

and to investigate the general trends of the economies in the many countries where the company

may be doing business. Frequently, top managers equip a special "war room" with large screensonto which the EIS projects color displays

The main uses are,

1) EIS provide immediate and easy access to information reflecting the key success factors of the

company and of its units.

2) "User-seductive" interfaces, such as color graphics and video, allow the EIS user to grasp trends at

a glance. Users’ time is at a high premium here.

3) EIS provide access to a variety of databases, both internal and external, through a uniforminterface-the fact that the system consults multiple databases should be transparent to the users.

4) Both current status and projections should be available from EIS. It is frequently desirable to

investigate different projections; in particular, planned projections may be compared with the

projections derived from actual results.

5) An EIS should allow easy tailoring to the preferences of the particular user or group of users (such

as the chief executive’s cabinet or the corporate board).

6) EIS should offer the capability to "drill down" into the data: It should be possible to see

increasingly detailed data behind the summaries.

8. Explain various Organizational limits to Relational Decision Making.

The rational model of organizational decision making reflects only some aspects of the decision-

making environment: those that lend themselves most readily to receiving support from information

systems. Other aspects include incrementalism, chance-driven choice making, political/competitive

behaviour, and programmed choice making. As you shall see, most of these decision-makingbehaviors are rooted in the divergent interests of the people involved in making a decision.

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Therefore, various types of group decision support systems (GDSSs) can help these groups to

negotiate, foresee, and manage a crisis, or to look at a broad array of alternatives before arriving at

a decision.

Charles Lindblom analyzed how the decision-making process, particularly in large

organizations(including governments), differs from the rational model. He contended that decisionmaking in large organizations under ordinary circumstances is a process of "muddling through"-

making small, incremental changes from existing actions and policies. The important criteria in this

decision-making mode are avoiding the uncertainty of major changes and maintaining the consensus

of all involved. Making a decision is not concluded by the "choice" of an alternative; it is rather a

continuous process, during which any chosen course of action may be modified as it is implemented.

The more recent, and most pessimistic, so-called garbage can theory of organizational decision

making is based on the premise that not all organizations are destined to succeed-many

companies(even those considered excellent at some point) will fail. These firms are unable to adapt

to the changing environment, and much of their decision making consists of attaching solutions to

problems in a rather random manner. In one sense, "garbage-can" decision making is present tosome extent in all companies: because of the difficulty in forecasting outcomes, chance does playa

role in providing a solution to many an organizational problem.

Other aspects of organizational decision making are reflected by what George Huber called the

political/competitive model. A decision process generally includes several participants, each of

whom may seek to influence the decision in a direction favourable to themselves or to the unit they

represent. For example, several studies of budget development clearly point to it being a political

process. The need to reconcile the diverging interests of various stake holders (for example, senior

management, labor, government, and others) often leads participants to avoid making major

departures from current policies-and is thus one of the reasons for incremental decision making.

Rational decision making in organizations is also limited by programmed behavior. When decisionmakers engage in this type of behavior, they follow standard operating procedures, which constrain

their choices and prevents creative problem solving as they opt for the "safe and tried."An analysis

of the results of previous choices, assisted by information systems, may help decision makers relax

the constraints of programmed choice making.

9. Explain different components of DSS.

The three principal DSS subsystems and their principal capabilities are shown in figure 10.1. Various

commercial systems support DSS development and package these DSS capabilities in a variety of

ways by distributing them among a series of optional modules.

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Data Management Subsystem

The data management subsystem of a DSS relies, in general, on a variety of internal and external

databases. Indeed, we have said that the power of DSS de rives from their ability to provide easy

access to data. This is not to say that a simple, usually spreadsheet-based DSS for the personal use of

a manager cannot rely on the manager’s limited personal database. It is simply that maintaining the

currency and integrity of a significant database of this kind is usually a daunting task. Proliferation of

personal databases also contradicts the principles of information resource management.

The Model Management Subsystem

The power of DSS rests on the user’s ability to apply quantitative, mathematical models to

data.Models has different areas of application and come from a variety of sources. Software

packages for developing DSS (so-called DSS generators) contain libraries of statistical models. Thesemodels include tools for the exploratory analysis of data-tools designed to obtain summarized

measures such as mean and median values, variances, scatter plots, and so forth. Other statistical

model shelp analyze series of data and forecast future outcomes by approximating a set of data with

a mathematical equation, by extending the trend of a curve by extrapolation techniques, or by

providing for seasonal adjustment.

The Dialog Management Subsystem

Along with DSS’s ability to apply models to large volumes of data from a variety of sources, a single

advantage of DSS is the user-friendly and flexible interface between the human decision maker and

such a system. This stands in contrast to management reporting systems. The notable feature issupport of multiple forms of input and output. By combining various input and output capabilities of

a DSS, users can engage in the individual dialog styles that best support their decision-making styles.

The field of artificial intelligence has made some notable contributions to dialog management, such

as the ability to specify what is wanted in a subset of natural language or to activate the system by

voice. The window capability enables the user to maintain several activities at the same time, with

the results displayed in screen windows (the user employs a mouse to move between the

windows).A variety of help and even training-by-example capabilities may be offered. Significant

attention has been devoted by researchers to the effectiveness of computer graphics, as opposed to

the tabular display of data. Gary Dickson and his colleagues found that, in general, one cannot claim

an advantage (however intuitively appealing it may he) for graphics throughout all decision-related

activities. They did find, however, that graphs outperform tables when a large amount of information must be presented and a relatively simple impression is desired. This is very often the

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case-and the main reason why executive information systems, discussed later in this chapter, rely

heavily on graphics.

10. Write a note on Ethical and Social issues with E-Commerce.

1. Internet can be used in illegal ways, as there are no laws related to its use. Many servers contain

illegal, immoral, defamatory information (which cannot be legally communicated using facilities like

TV, radio, etc.)

2. There is minimal or no control over the Internet (unlike telephone, radio, TV, etc.). Limited

banning of material in Internet is not possible i.e. all-or-none rule.

3. Free speech advocates say that screening of incoming material is the responsibility of the

receiving end

4. There is no law against Spamming i.e. sending unsolicited mail

5. Massive flaming of large quantity of e-mail to one address. The question arises – Is

sending/receiving large quantity of mail ethical?

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MC0076 Set1