Mis dss

ITEC 1010 Information and Organizations

Management Information Systems


MIS Model


Management Information Systems (MIS)

Management information system (MIS)

• An MIS provides managers with information and support for effective decision making, and provides feedback on daily operations

• Output, or reports, are usually generated through accumulation of transaction processing data

• Each MIS is an integrated collection of subsystems, which are typically organized along functional lines within an organization

• A combination of computers and people that is used to provide information to aid in making decisions and managing a firm.


Managers and Information

Generally, managers at different levels of an organizational hierarchy: Make different types of decisions Control different types of processes Therefore, they have different information needs


Managers and Information


The Traditional Organizational Pyramid

Many organizations follow pyramid model CEO at top Small group of senior managers, one level down Larger number of middle managers, reporting to senior managers Many more lower-level managers who report to middle managers

Clerical and Shop Floor Workers Bottom of organizational pyramid

Operational Management In charge of small groups of front-line workers


Tactical Management Also called middle managers Make decisions for subordinates, affecting the near

and somewhat more distant future Strategic Management

Decisions affect entire or large parts of the organization; “what to do” decisions

The Traditional Organizational Pyramid


Characteristics of Information at Different Managerial Levels

Different management levels have different information needs

Information needed by different managerial and operational levels varies in the time span covered, level of detail, source, and other characteristics over a broad spectrum


Data Range Amount of data from which information is extracted

Time Span How long a period the data covers

Level of Detail Degree to which information is specific




Source: Internal versus External Internal data: collected within the organization External data: collected from outside sources

• Media, newsletters, government agencies, Internet


The Nature of Managerial Work

Planning Planning at different levels

• Long-term mission and vision• Strategic goals• Tactical objectives

Most important planning activities• Scheduling• Budgeting• Resource allocation



An example of a mission statement, strategic goals, and tactical objectives for an in-line skate manufacturer



The main ingredients of planning


Figure 9.5 Examples of processes used to control projects


Controlling Managers control activities by comparing plans to

results.



Decision Making Both planning and control call for decision making The higher the level of management:

• The less routine the manager’s activities

• The more open the options

• The more decision-making involved


Sources of Management Information

Schematic


Corporatedatabasesofinternaldata

Databasesofexternaldata

Databasesofvalidtransactions

Operationaldatabases

Transactionprocessingsystems

Managementinformationsystems

Decisionsupportsystems

Executivesupportsystems

Expertsystems

Businesstransactions

Input anderror list

Drill-down reports

Exception reports

Demand reports

Key-indicator reports

Scheduledreports

Employees

Corporateintranet

Applicationdatabases


Outputs of a Management Information System

Scheduled reports• Produced periodically, or on a schedule (daily, weekly,

monthly)

Key-indicator report• Summarizes the previous day’s critical activities• Typically available at the beginning of each day

Demand report• Gives certain information at a manager’s request

Exception report• Automatically produced when a situation is unusual or

requires management action


Scheduled Report Example

Daily Sales Detail Report

Prepared: 08/10/xx

Order#

CustomerID

Sales Rep ID

ShipDate 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


Key Indicator Report Example

Daily Sales Key Indicator Report

ThisMonth

LastMonth

LastYear

Total Orders Month to Date $1,808 $1,694 $1,014

Forecasted Sales for the Month $2,406 $2,224 $2,608


Demand Report Example

Daily Sales by Sales Rep Summary Report

Prepared: 08/10/xx

Sales Rep ID Amount

CAR $42,345

GWA $38,950

SAK $22,100

JWN $12,350


Exception Report Example

Daily Sales Exception Report – ORDERS OVER $10,000

Prepared: 08/10/xx

Order#

CustomerID

Sales Rep ID

ShipDate Quantity Item # Amount

P12453 C89321 CAR 08/12/96 144 P1234 $13,214

P12453 C89321 CAR 08/12/96 288 P3214 $15,660

P12453 C03214 GWA 08/13/96 12 P4902 $11,224

… … … … … … …

… … … … … … …


Outputs of a Management Information System

Earnings by Quarter (Millions)

Actual Forecast Variance

2ND Qtr 1999 $12.6 $11.8 6.8%

1st Qtr 1999 $10.8 $10.7 0.9%

4th Qtr 1998 $14.3 $14.5 -1.4%

3rd Qtr 1998 $12.8 $13.3 -3.0%

Etc. See Figure 9.2

Drill Down ReportsProvide detailed data about a situation.


Characteristics of a Management Information System

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 reports Requires formal requests from users


Management Information Systems for Competitive Advantage

Provides support to managers as they work to achieve corporate goals

Enables managers to compare results to established company goals and identify problem areas and opportunities for improvement


MIS and Web Technology

Data may be made available from management information systems on a company’s intranet

Employees can use browsers and their PC to gain access to the data


Functional Aspects

MIS is an integrated collection of functional information systems, each supporting particular functional areas.

Schematic


An Organization’sMIS

FinancialMIS

MarketingMIS

HumanResources

MIS

Etc.

AccountingMIS

Drill down reports

Exception reports

Demand reports

Key-indicator reports

Scheduled reports

Databasesof

externaldata

Databasesof

validtransactions

Transactionprocessing

systems



ExtranetExtranet

InternetInternet

Figure 9.3

Etc.


Financial MIS

Provides financial information to all financial managers within an organization.

Schematic


Financial statements

Uses and managementof funds

Financial statisticsfor control

Operationaldatabases

Databasesof valid

transactionsfor each

TPS

Transactionprocessing

systems



Internet orExtranet

Internet orExtranet

Figure 9.3

FinancialMIS


Databases ofexternal data

Databases ofinternal data

FinancialDSS

FinancialES

Financialapplications

databases

Customers,Suppliers


Inputs to the Financial Information System

Strategic plan or corporate policies Contains major financial objectives and often projects

financial 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.


Financial MIS Subsystems and Outputs

Financial subsystems Profit/loss and cost systems Auditing Internal auditing External auditing Uses and management of funds


Decision Support Systems


Decision Support Systems

Decision support systems (DSS) Offer potential to assist in solving both semi-

structured and unstructured problems


Decision Making as a Component of Problem Solving

Intelligence

Design

Choice

Implementation

Monitoring

Problemsolving

Decisionmaking


Solution Types

Optimization model Finding the best solution

Satisficing model Finding a good -- but not necessarily the best

-- solution to a problem Heuristics

Commonly accepted guidelines or procedures that usually find a good solution


Problem Solving Factors

Multiple decision objectives Increased alternatives Increased competition The need for creativity Social and political actions International aspects Technology Time compression


Characteristics of a DSS (1)

Handles large amounts of data from different sources

Provides report and presentation flexibility Offers both textual and graphical

orientation



Supports drill down analysis Performs complex, sophisticated analysis

and comparisons using advanced software packages

Supports optimization, satisficing, and heuristic approaches



Performs different types of analyses “What-if” analysis

• Makes hypothetical changes to problem and observes impact on the results

Simulation• Duplicates features of a real system

Goal-seeking analysis• Determines problem data required for a given result


Goal Seeking Example

You know the desired result You want to know the required input(s) Example:

Microsoft Excel’s “Goal Seek” and “Solver” functions


Exceldemo


Capabilities of a DSS (1)

Supports Problem solving phases Different decision frequencies

Frequencylow high

Merge withanother

company?

How many widgets

should I order?


Capabilities of a DSS (2)

Highly structured problems Straightforward problems, requiring known

facts and relationships.

Semi-structured or unstructured problems Complex problems wherein relationships

among data are not always clear, the data may be in a variety of formats, and are often difficult to manipulate or obtain


Decision Making Levels

Operational-levelmanagers involved withdaily decisions

Strategic-level managersinvolved with long-term

decisions

LowHigh

Decision Frequency

Strategic

Tactical

Operational


Integration ofTPS, MIS, and DSS

In many organizations they are integrated through a common database

Separation of DSS transactions in the database from TPS and MIS transactions may be important for performance reasons


Web-Based Decision Support Systems

Web-based decision support systems Decision support system software provides

business intelligence through web browser clients that access databases either through the Internet or a corporate intranet


Components of a DSS

Model management software (MMS) Coordinates the use of models in the DSS

Model base Provides decision makers with access to a

variety of models Dialogue manager

Allows decision makers to easily access and manipulate the DSS


Database Model base

External databaseaccess

Access to theinternet, networks,and other computersystems

Dialogue manager

DBMS MMS

Externaldatabases


Model Base

Model Base Provides decision makers with

access to a variety of models and assists them in decision making

Models Financial models Statistical analysis models Graphical models Project management models


Advantages and Disadvantagesof Modeling

Advantages• Less expensive than custom approaches or real systems.• Faster to construct than real systems• Less risky than real systems• Provides learning experience (trial and error)• Future projections are possible• Can test assumptions

Disadvantages• Assumptions about reality may be incorrect• Accuracy of predications often unreliable• Requires abstract thinking


Group Decision Support System

Group Decision Support System (GDSS) Contains most of the elements of DSS plus

software to provide effective support in group decision-making settings


Databases

Model base GDSS processor GDSS software

Dialoguemanager

External databaseaccess

Users

Access to the internetand corporate intranet,

networks, and othercomputer system

Externaldatabases


Characteristics of a GDSS (1)

Special design Ease of use Flexibility Decision-making support

Delphi approach (decision makers are geographically dispersed)

Brainstorming Group consensus Nominal group technique


Characteristics of a GDSS (2)

Anonymous input Reduction of negative group behaviour Parallel communication Automated record keeping Cost, control, complexity factors


Components of a GDSS and GDSS Software

Database Model base Dialogue manager Communication capability Special software (also called GroupWare) E.g., Lotus Notes

people located around the world work on the same project, documents, and files, efficiently and at the same time


GDSS Alternatives

Local areadecision network

Wide areadecision network

Decisionroom

Teleconferencing

Location of group members

close distant

high

low

Dec

isio

n fr

eque

ncy


Decision Room

Decision Room For decision makers located in the same geographic

area or building Use of computing devices, special software,

networking capabilities, display equipment, and a session leader

Collect, coordinate, and feed back organized information to help a group make a decision

Combines face-to-face verbal interaction with technology-aided formalization



Wide Area Decision Network

Characteristics Location of group members is distant Decision frequency is high Virtual workgroups

• Groups of workers located around the world working on common problems via a GDSS


Executive Support System

Characteristics A specialized DSS that

includes all the hardware, software, data, procedures, and people used to assist senior-level executives within the organization

Board of directors

President

Function areavice presidents

Function areamanagers


Characteristics of ESSs

Tailored to individual executives Easy to use Drill down capabilities Support the need for external data Help with situations with high degree of

uncertainty Futures orientation (predictions, forecasting) Linked with value-added business processes


Capabilities of an ESS

Support for defining overall vision strategic planning strategic organizing and staffing strategic control crisis management