ASSIGNMENTS - MBA – II SEMESTER

MB0031 (4 CREDITS)

SET 1

MANAGEMENT INFORMATION SYSTEMS

Q.1:- a. Explain the impact of MIS in the area of police Information system.
b. What are the functions and disadvantages of MIS?

Ans:- MIS is an Information system which helps in providing the management of an

organization with information which is used by management for decision making.

A management information system (MIS) is a subset of the overall internal controls of

a business covering the application of people, documents, technologies, and procedures by
management accountants to solving business problems such as costing a product, service or a
business-wide strategy. Management information systems are distinct from regular
information systems in that they are used to analyze other information systems applied in
operational activities in the organization. Academically, the term is commonly used to refer
to the group of information management methods tied to the automation or support of human
decision making, e.g. Decision Support Systems, Expert systems, and Executive information
systems.

During the period of preindustrial revolution most of the data processing was done manually.
It was after the industrial revolution that the computers slowly started replacing manual
labour. The modern digital computer was basically designed to handle scientific calculations.
During the period 1940 to 1960 computers were commercially used for census and payroll
work. This involved large amount of data and its processing. Since then the commercial
application exceeded the scientific applications for which the computer were mainly intended
for. MIS is an Information system which helps in providing the management of an
organization with information which is used by management for decision making.

Impact of MIS MIS has a major impact on the functions of any organization. The
organization derives benefits from the systems in the following form:
(a) Speedy access to information,
(b) Interpretation of data,
(c) Quick decisions,
(d) Speedy actions,
(e) Increased productivity and thereby increase in the profit
(f) Reduced transaction cost
The usage of Electronic media for data storage and processing the data is an integral
part of MIS. The texts and images in electronic forms are effective in communicating

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ideas from source to destination. It is technology driven in the sense it revolves around
wireless electronic gadgets, internet, money cards – credits cards, debit cards, id cards, atm
cards etc.
MIS is very significant in modern day education system where we come across
usage of LCDs, Smart boards, internet etc in class rooms. In the tourism MIS has led to
radical changes in booking system, tourist information system, hotel facilities,
accommodation facilities, transportation modes available, images of the facilities that could
be provided etc.

Transportation
Teaching planning
methodology

Better Tourists Office

Information automation
MIS

Increased
Production
Better Banking
system

Function of MIS The main function of MIS is to help the managers and the executives
in the organization in decision making.

1. Large quantities of data like customers information, competitors

information, personnel records, sales data, accounting data etc is collected from
internal sources like the company records and external sources like annual reports
and publications.
2. The collected data is organized in the form of a database.
3. The data from the database is processed and analysed by using different
tools and techniques.
4. The results of the analysis is properly presented to the managers to help them
in decision making.

Disadvantages of MIS

1. Highly senstive requires constant monitoring.

2. Budgeting of MIS extremely difficult.
3. Quality of outputs governed by quality of inputs.
4. Lack of flexiblity to update itself.
5. Effectiveness decreases due to frequent changes in top management

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 6. Takes into account only qualitative factors and ignores non-qualitative factors
like morale of worker, attitude of worker etc...

Q.2:- a. Write a scenario which shows the applications of OLAP systems.

b. How does Information technology influence the organization ’s goals?

Ans:- Online Analytical Processing (OLAP) OLAP refers to a system in which there
are predefined multiple instances of various modules used in business applications. Any
input to such a system results in verification of the facts with respect to the
available instances. A nearest match is found analytically and the results displayed
form the database. The output is sent only after thorough verification of the input
facts fed to the system.

The system goes through a series of multiple check of the various parameters used in
business decision making. OLAP is also referred to as a multi dimensional analytical model.
Many big companies use OLAP to get good returns in business. The querying process of the
OLAP is very strong. It helps the management take decisions like which month would be app
ropriate to launch a product in the market, what should be the production quantity to
maximize the returns, what should be the stocking policy in order to minimize the wastage
etc.

Demand

Region

Sales

Model of OLAP
IT influences Organizations goals There is always a mention about what IT contributes to cor
porate strategy. It was recognized that corporation achieved a significant competitive
advantage by adopting suitable IT concepts in building

While many people think of decision support systems as a specialized part of a

business, most companies have actually integrated this system into their day to day operating

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activities. For instance, many companies constantly download and analyze sales data, budget
sheets and forecasts and they update their strategy once they analyze and evaluate the current
results. Decision support systems have a definite structure in businesses, but in reality, the
data and decisions that are based on it are fluid and constantly changing.

Types of DSS

Data-Driven DSS take the massive amounts of data available through the company's TPS
and MIS systems and cull from it useful information which executives can use to make more
informed decisions. They don't have to have a theory or model but can "free-flow" the data.
The first generic type of Decision Support System is a Data-Driven DSS. These systems
include file drawer and management reporting systems, data warehousing and analysis
systems, Executive Information Systems (EIS) and Spatial Decision Support Systems.
Business Intelligence Systems are also examples of Data-Driven DSS. Data-Driven DSS
emphasize access to and manipulation of large databases of structured data and especially a
time-series of internal company data and sometimes external data. Simple file systems
accessed by query and retrieval tools provide the most elementary level of functionality. Data
warehouse systems that allow the manipulation of data by computerized tools tailored to a
specific task and setting or by more general tools and operators provide additional
functionality.

Data-Driven DSS with Online Analytical Processing (OLAP) provide the highest
level of functionality and decision support that is linked to analysis of large collections of
historical data.

Model-Driven DSS A second category, Model-Driven DSS, includes systems that use
accounting and financial models, representational models, and optimization models. Model-
Driven DSS emphasize access to and manipulation of a model. Simple statistical and
analytical tools provide the most elementary level of functionality. Some OLAP systems that
allow complex analysis of data may be classified as hybrid DSS systems providing modeling,
data retrieval and data summarization functionality. Model-Driven DSS use data and
parameters provided by decision-makers to aid them in analyzing a situation, but they are not
usually data intensive. Very large databases are usually not needed for Model-Driven DSS.

Model-Driven DSS were isolated from the main Information Systems of the
organization and were primarily used for the typical "what-if" analysis. That is, "What if we
increase production of our products and decrease the shipment time?" These systems rely
heavily on models to help executives understand the impact of their decisions on the
organization, its suppliers, and its customers.

Knowledge-Driven DSS The terminology for this third generic type of DSS is still
evolving. Currently, the best term seems to be Knowledge-Driven DSS. Adding the modifier
“driven” to the word knowledge maintains a parallelism in the framework and focuses on the
dominant knowledge base component. Knowledge-Driven DSS can suggest or recommend

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actions to managers. These DSS are personal computer systems with specialized problem-
solving expertise. The "expertise" consists of knowledge about a particular domain,
understanding of problems within that domain, and "skill" at solving some of these problems.
A related concept is Data Mining. It refers to a class of analytical applications that search for
hidden patterns in a database. Data mining is the process of sifting through large amounts of
data to produce data content relationships.

Document-Driven DSS A new type of DSS, a Document-Driven DSS or Knowledge

Management System, is evolving to help managers retrieve and manage unstructured
documents and Web pages. A Document-Driven DSS integrates a variety of storage and
processing technologies to provide complete document retrieval and analysis. The Web
provides access to large document databases including databases of hypertext documents,
images, sounds and video. Examples of documents that would be accessed by a Document-
Based DSS are policies and procedures, product specifications, catalogs, and corporate
historical documents, including minutes of meetings, corporate records, and important
correspondence. A search engine is a powerful decision aiding tool associated with a
Document-Driven DSS.

Communications-Driven and Group DSS Group Decision Support Systems

(GDSS) came first, but now a broader category of Communications-Driven DSS or
groupware can be identified. This fifth generic type of Decision Support System includes
communication, collaboration and decision support technologies that do not fit within those
DSS types identified. Therefore, we need to identify these systems as a specific category of
DSS. A Group DSS is a hybrid Decision Support System that emphasizes both the use of
communications and decision models. A Group Decision Support System is an interactive
computer-based system intended to facilitate the solution of problems by decision-makers
working together as a group. Groupware supports electronic communication, scheduling,
document sharing, and other group productivity and decision support enhancing activities We
have a number of technologies and capabilities in this category in the framework – Group
DSS, two-way interactive video, White Boards, Bulletin Boards, and Email.

The five levels Scott Morton proposes five levels of complexity at which
reconfiguration can be applied. The following five levels indicates how it is possible to
reconfigure strategic information system based on the influence of IT.
1. Localised exploitation This is part of the Evolutionary level and exists
within individual business functions. It addresses the local efficiency and
effectiveness of a information system.

2. Internal integration This is part of the evolutionary level and exists

between different systems and applications. It evolves out of rationalization
using a common IT platform. Efficiency and effectiveness are enhanced by
coordination and cooperation within the enterprise;

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 3. Business process redesign This is part of the revolutionary level. It
involves more thorough reevaluation of the enterprise valuechain and the production
process.

4. Business network redesign This is also part of the revolutionary

level. It involves reconfiguration of the scope and tasks of the business network. It
also helps in the creation and delivery of products and services. Coordination and
cooperation extend, selectively, beyond the enterprise's boundaries; and

5. Business scope redefinition It is also part of the revolutionary level. It

involves migration of functions across the enterprise's boundaries. It may
change the organization's conception of the business.

Scott Morton's Five Levels of ITInduced Reconfiguration (Scott Morton 1991)

(b) Software Development Life Cycle (SDLC)

India Outsourcing > Software Development Life Cycle

As in any other engineering discipline, software engineering also has some structured
models for software development. This document will provide you with a generic overview
about different software development methodologies adopted by contemporary software
firms. Read on to know more about the Software Development Life Cycle (SDLC) in detail.

Curtain Raiser Like any other set of engineering products, software products are also
oriented towards the customer. It is either market driven or it drives the market. Customer
Satisfaction was the buzzword of the 80's. Customer Delight is today's buzzword and
Customer Ecstasy is the buzzword of the new millennium. Products that are not customer or
user friendly have no place in the market although they are engineered using the best
technology. The interface of the product is as crucial as the internal technology of the
product.

Market Research A market study is made to identify a potential customer's need. This
process is also known as market research. Here, the already existing need and the possible
and potential needs that are available in a segment of the society are studied carefully. The
market study is done based on a lot of assumptions. Assumptions are the crucial factors in the
development or inception of a product's development. Unrealistic assumptions can cause a
nosedive in the entire venture. Though assumptions are abstract, there should be a move to
develop tangible assumptions to come up with a successful product.

Research and Development Once the Market Research is carried out, the customer's
need is given to the Research & Development division (R&D) to conceptualize a cost-
effective system that could potentially solve the customer's needs in a manner that is better
than the one adopted by the competitors at present. Once the conceptual system is developed
and tested in a hypothetical environment, the development team takes control of it. The

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development team adopts one of the software development methodologies that is given
below, develops the proposed system, and gives it to the customer.

The Sales & Marketing division starts selling the software to the available customers
and simultaneously works to develop a niche segment that could potentially buy the software.
In addition, the division also passes the feedback from the customers to the developers and
the R&D division to make possible value additions to the product.

While developing a software, the company outsources the non-core activities to other
companies who specialize in those activities. This accelerates the software development
process largely. Some companies work on tie-ups to bring out a highly matured product in a
short period.

Popular Software Development Models The following are some basic popular models
that are adopted by many software development firms

1. System Development Life Cycle (SDLC) Model

2. Prototyping Model
3. Rapid Application Development Model
4. Component Assembly Model

A. System Development Life Cycle (SDLC) Model This is also known as Classic
Life Cycle Model (or) Linear Sequential Model (or) Waterfall Method. This model has the
following activities.

1. System/Information Engineering and Modeling As software is always of a large

system (or business), work begins by establishing the requirements for all system elements
and then allocating some subset of these requirements to software. This system view is
essential when the software must interface with other elements such as hardware, people and
other resources. System is the basic and very critical requirement for the existence of
software in any entity. So if the system is not in place, the system should be engineered and
put in place. In some cases, to extract the maximum output, the system should be re-
engineered and spruced up. Once the ideal system is engineered or tuned, the development
team studies the software requirement for the system.

2. Software Requirement Analysis This process is also known as feasibility

study. In this phase, the development team visits the customer and studies their system. They
investigate the need for possible software automation in the given system. By the end of the
feasibility study, the team furnishes a document that holds the different specific
recommendations for the candidate system. It also includes the personnel assignments, costs,
project schedule, target dates etc.... The requirement gathering process is intensified and
focussed specially on software. To understand the nature of the program(s) to be built, the
system engineer or "Analyst" must understand the information domain for the software, as

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well as required function, behavior, performance and interfacing. The essential purpose of
this phase is to find the need and to define the problem that needs to be solved.

3. System Analysis and Design In this phase, the software development process,
the software's overall structure and its nuances are defined. In terms of the client/server
technology, the number of tiers needed for the package architecture, the database design, the
data structure design etc... are all defined in this phase. A software development model is thus
created. Analysis and Design are very crucial in the whole development cycle. Any glitch in
the design phase could be very expensive to solve in the later stage of the software
development. Much care is taken during this phase. The logical system of the product is
developed in this phase.

4. Code Generation The design must be translated into a machine-readable form.

The code generation step performs this task. If the design is performed in a detailed manner,
code generation can be accomplished without much complication. Programming tools like
compilers, interpreters, debuggers etc... are used to generate the code. Different high level
programming languages like C, C++, Pascal, Java are used for coding. With respect to the
type of application, the right programming language is chosen.

B. Prototyping Model This is a cyclic version of the linear model. In this model, once
the requirement analysis is done and the design for a prototype is made, the development
process gets started. Once the prototype is created, it is given to the customer for evaluation.
The customer tests the package and gives his/her feed back to the developer who refines the
product according to the customer's exact expectation. After a finite number of iterations, the
final software package is given to the customer. In this methodology, the software is evolved
as a result of periodic shuttling of information between the customer and developer. This is
the most popular development model in the contemporary IT industry. Most of the successful
software products have been developed using this model - as it is very difficult (even for a
whiz kid!) to comprehend all the requirements of a customer in one shot. There are many
variations of this model skewed with respect to the project management styles of the
companies. New versions of a software product evolve as a result of prototyping.
Back to top.

C. Rapid Application Development (RAD) Model The RAD modelis a linear

sequential software development process that emphasizes an extremely short development
cycle. The RAD model is a "high speed" adaptation of the linear sequential model in which
rapid development is achieved by using a component-based construction approach. Used
primarily for information systems applications, the RAD approach encompasses the
following phases:

1. Business modeling The information flow among business functions is

modeled in a way that answers the following questions:

What information drives the business process?

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 What information is generated?
Who generates it?
Where does the information go?
Who processes it?

2. Data modeling The information flow defined as part of the business

modeling phase is refined into a set of data objects that are needed to support the
business. The characteristic (called attributes) of each object is identified and the
relationships between these objects are defined.

3. Process modeling The data objects defined in the data-modeling phase are
transformed to achieve the information flow necessary to implement a business
function. Processing the descriptions are created for adding, modifying, deleting, or
retrieving a data object.

4. Application generation The RAD model assumes the use of the RAD
tools like VB, VC++, Delphi etc... rather than creating software using conventional
third generation programming languages. The RAD model works to reuse existing
program components (when possible) or create reusable components (when
necessary). In all cases, automated tools are used to facilitate construction of the
software.

5. Testing and turnover Since the RAD process emphasizes reuse, many
of the program components have already been tested. This minimizes the testing and
development time.
Back to top

D. Component Assembly Model Object technologies provide the technical

framework for a component-based process model for software engineering. The object
oriented paradigm emphasizes the creation of classes that encapsulate both data and the
algorithm that are used to manipulate the data. If properly designed and implemented, object
oriented classes are reusable across different applications and computer based system
architectures. Component Assembly Model leads to software reusability. The
integration/assembly of the already existing software components accelerates the
development process. Nowadays many component libraries are available on the Internet. If
the right components are chosen, the integration aspect is made much simpler.

Q.3:- a. Explain the role of systems analyst in SDLC. Explain with a scenario.
b. Draw a data flow diagram for an hospital management system.

Ans:- SDLC System development cycle stages are sometimes known as system
study. System concepts which are important in developing business information systems
expedite problem solving and improves the quality of decisionmaking. The system analyst

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has to do a lot in this connection. They are confronted with the challenging task of
creating new systems an planning major changes in the organization.

The system analyst gives a system development project, meaning and direction. The t
ypical breakdown of an information systems life cycle includes a feasibility study,
requirements, collection and analysis, design, prototyping, implementation, validation,
testing and operation. It may be represented in the form of a block diagram as shown below:

1. Feasibility study It is concerned with determining the cost effectiveness

of various alternatives in the designs of the information system and the priorities
among the various system components.

2. Requirements, collection and analysis It is concerned with

understanding the mission of the information systems, that is, the
application areas of the system within the enterprise and
the problems that the system should solve.

3. Design It is concerned with the specification of the information

systems structure. There are two types of design, database design and application
design. The database design is the design of the database design and the application
design is the design of the application programs.

4. Prototyping A prototype is a simplified implementation that is produced in

order to verify in practice that the previous phases of the design were well conducted.

5. Implementation It is concerned with the programming of the final

operational version of the information system. Implementation alternatives are
carefully verifies and compared.

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 6. Validation and testing It is the process of assuring that each phase
of the development process is of acceptable quality and is an accurate transformation
from the previous phase.

Data Flow Diagram Data flow diagrams represent the logical flow of data within
the system. DFD do not explain how the processes convert the input data into output. They do
not explain how the processing takes place. DFD uses few symbols like circles and rectangles
connected by arrows to represent data flows. DFD can easily illustrate relationships
among data, flows, external entities an stores. DFD can also be drawn in increasing
levels of detail, starting with a summary high level view and proceeding more
detailed lower level views.

Q.4:- What are the features contributing to success and failures of MIS models?

Ans:- Factors Contributing to Success of MIS The following features contributing a lot
for the success of MIS and are listed below:-

1. The MIS is integrated into the managerial functions. It sets clear objectives to ensure
that the MIS focuses on the major issues of the business. Also adequate development
resources are provided and the human and organisational barriers to progress are removed.

2. An appropriate information processing technology required to meet the data

processing and analysis needs of the users of the MIS is selected.

3. The MIS is oriented, defined and designed in terms of the user’s requirements and its
operational viability is ensured.

4. The MIS is kept under continuous surveillance, so that its open system design is
modified according to the changing information needs.

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5. MIS focuses on the business results and goals, and highlights the factors and reasons
for non-achievement.

6. MIS is not allowed to end up into an information generation mill avoiding the noise in
the information and the communication system.

7. The MIS recognises that manager is a human being and therefore, the systems must
consider all the human behavioural factors in the process of the management.

8. The MIS recognises that the different information needs for different objectives must
be met with. The globalisation of information in isolation from the different objectives leads
to information overload and its non-use.

9. The MIS is easy to operate and, therefore, the design of the MIS has such features
which make up a user-friendly design.

10. MIS recognises that the information needs become obsolete and new needs emerge.
The MIS design, therefore, has a basic potential capability to quickly meet new needs of
information.

11. The MIS concentrates on the developing the information support to manage critical
success factors. It concentrates on the mission critical applications serving the needs of the
top management.

Factors Contributing to Failure of MIS The common observed features which are
responsible for the failure of MIS is as follows:-

1. The MIS is conceived as a data processing and not as an information processing

system.

2. The MIS does not provide that information which is needed by the managers but it
tends to provide the information generally the function calls for. The MIS then becomes an
impersonal system.

3. Underestimating the complexity in the business systems and not recognising it in the
MIS design leads to problems in the successful implementation.

4. Adequate attention is not given to the quality control aspects of the inputs, the process
and the outputs leading to insufficient checks and controls in the MIS.

5. The MIS is developed without streamlining the business processing systems in the
organisation.

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6. Lack of training and appreciation that the users of the information and the generators
of the data are different, and they have to play an important responsible role in the MIS.

7. The MIS does not meet certain critical and key factors of its users such as a response
to the query on the database, an inability to get the processing done in a particular manner,
lack of user-friendly system and the dependence on the system development personnel.

8. A belief that the computerised MIS can solve all the management problems of
planning and control of the business.

9. Lack of administrative discipline in following the standardised systems and

procedures, wrong coding and deviating from the system specifications result in incomplete
and incorrect information.

11. The MIS does not give perfect information to all the users in the organisation. Any
attempt towards such a goal will be unsuccessful because every user has a human ingenuity,
bias, certain assumptions not known to the designer. The MIS cannot make up these by
providing perfect information.

Q.5:- What are the limitations of ERP systems? How do ERP packages help in
overcoming theses limitations?

Ans:- Enterprise Resource Planning Manufacturing management systems have

evolved in stages over the few decades from a simple means of calculating materials
requirements to the automation of an entire enterprise. Around 1980, over frequent changes
in sales forecasts, entailing continual readjustments in production, as well as the unsuitability
of the parameters fixed by the system, led MRP (Material Requirement Planning) to evolve
into a new concept : Manufacturing Resource Planning (or MRP2) and finally the
generic concept Enterprise Resource Planning (ERP)

The initials ERP originated as an extension of MRP (material requirements

planning then manufacturing resource planning). ERP systems now attempt to cover
all basic functions of an enterprise, regardless of the organization's business or charter.
Nonmanufacturing businesses, nonprofit organizations and governments now all utilize ERP
systems. To be considered an ERP system, a software package must provide the
function of at least two systems. For example, a software package that provides both
payroll and accounting functions could technically be considered an ERP software package.

However, the term is typically reserved for larger, more broadly based applications.
The introduction of an ERP system to replace two or more independent applications
eliminates the need for external interfaces previously required between systems, and

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provides additional benefits that range from standardization and lower maintenance to
easier and/or greater reporting capabilities.

Some organizations -typically those with sufficient inhouse IT skills to integrate

multiple software products - choose to implement only portions of an ERP system and
develop an external interface to other ERP or standalone systems for their other application
needs. For example, one may choose to use the HRMS from one vendor, and the
financials systems from another, and perform the integration between
the systems themselves.

Ideally, ERP delivers a single database that contains all data for the software modules,
which would include:

Enterprise Resource Planning is a term originally derived from manufacturing

resource planning that followed material requirements planning . MRP evolved into
ERP when "routings" became a major part of the software architecture and a
company's capacity planning activity also became a part of the standard software activity.
ERP systems typically handle the manufacturing, logistics, distribution, inventory,
shipping, invoicing, and accounting for a company. Enterprise Resource Planning or ERP
software can aid in the control of many business activities, like sales, marketing,
delivery, billing, production, inventory management, quality management, and human
resource management.

ERP systems saw a large boost in sales in the 1990s as companies faced the Y2K
problem in their legacy systems. Many companies took this opportunity to replace their
legacy information systems with ERP systems. This rapid growth in sales was followed by a
slump in 1999, at which time most companies had already implemented their Y2K solution.

ERPs are crossfunctional and enterprise wide. All functional departments that
are involved in operations or production are integrated in one system. In addition to
manufacturing, warehousing, logistics, and information technology, this would include
accounting, human resources, marketing, and strategic management.

The Ideal ERP System

An ideal ERP system is when a single database is utilized and contains all data for
various software modules. These software modules can include:

1. Manufacturing: Some of the functions include; engineering, capacity,

workflow management, quality control, bills of material, manufacturing process, etc.
2. Financials: Accounts payable, accounts receivable, fixed assets, general ledger
and cash management, etc.
3. Human Resources: Benefits, training, payroll, time and attendance, etc

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4. Supply Chain Management: Inventory, supply chain planning, supplier
scheduling, claim processing, order entry, purchasing, etc.
5. Projects: Costing, billing, activity management, time and expense, etc.
6. Customer Relationship Management: sales and marketing, service,
commissions, customer
contact, calls center support, etc.
7. Data Warehouse: Usually this is a module that can be accessed by an organizations
customers, suppliers and employees.

Limitations of ERP Success depends on the skill and experience of the workforce,
including training about how to make the system work correctly. Many companies cut costs
by cutting training budgets. Privately owned small enterprises are often undercapitalized,
meaning their ERP system is often operated by personnel with inadequate education
in ERP in general, such as APICS foundations, and in
the particular ERP vendor package being used.

1. Personnel turnover; companies can employ new managers lacking education in

the company's ERP system, proposing changes in business practices that are out of
synchronization with the best utilization of the company's selected ERP.
2. Customization of the ERP software is limited. Some customization may involve
changing of the ERP software structure which is usually not allowed.

3. Reengineering of business processes to fit the "industry standard" prescribed by

the ERP system may lead to a loss of competitive advantage.

4. ERP systems can be very expensive to install often ranging from 30,000 US
Dollars to 500,000,000 US Dollars for multinational companies.

5. ERP vendors can charge sums of money for annual license renewal that is unrelated to
the size of the company using the ERP or its profitability.

6. Technical support personnel often give replies to callers that are inappropriate for the
caller's corporate structure. Computer security concerns arise, for example when telling
a non programmer how to change a database on the fly, at a company that requires an audit
trail of changes so as to meet some regulatory standards.

7. ERPs are often seen as too rigid and too difficult to adapt to the specific
workflow and business process of some companies this is cited as one of the main causes of
their failure.

8. Systems can be difficult to use.

9. Systems are too restrictive and do not allow much flexibility in implementation and
usage.

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10. The system can suffer from the "weakest link" problem an inefficiency in one
department or at one of the partners may affect other participants.

11. Many of the integrated links need high accuracy in other applications to work
effectively. A company can achieve minimum standards, then over time "dirty data"
will reduce the reliability of some applications.

12. Once a system is established, switching costs are very high for any one of
the partners (reducing flexibility and strategic control at the corporate level).

13. The blurring of company boundaries can cause problems in accountability,

lines of responsibility, and employee morale.

14. Resistance in sharing sensitive internal information between departments can

reduce the effectiveness of the software.

15. Some large organizations may have multiple departments with separate,
independent resources, missions, chainsofcommand, etc, and consolidation into a single enter
prise may yield limited benefits.

16. There are frequent compatibility problems with the various legacy systems of the
partners.

17. The system may be overengineered relative to the actual needs of the customer.

Before ERP systems, each department in an organization would most likely have their
own computer system, data and database. Unfortunately, many of these systems would not be
able to communicate with one another or need to store or rewrite data to make it
possible for cross computer system communication. For instance, the financials of a
company were on a separate computer system than the HR system, making it more intensive
and complicated to process certain functions. Once an ERP system is in place, usually all
aspects of an organization can work in harmony instead of every single system needing to be
compatible with each other. For large organizations, increased productivity and less types of
software are a result.

Q.6:- Explain the relationship between artificial intelligence and neural networks with
the help of a scenario.

Ans:- Artificial Intelligence is the science and technology based on various functions to
develop a system that can think and work like a human being. It can reason, analyze,
learn, conclude and solve problems. The systems which use this type of intelligence are
known as artificial intelligent systems and their intelligence is referred to as artificial
intelligence. It was said that the computer don’t have common sense. Here in AI, the main
idea is to make the computer think like human beings, so that it can be then said that

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computers also have common sense. More precisely the aim is to
obtain a knowledge based computer system that will help managers to take quick decisions in
business.

Artificial Intelligence can be classified into various branches like Natural Language
Processing (NLP), Speech Recognition, Automated Programming, Machine Learning,
Pattern Recognition and Probabilistic Networks. Most of the software developed for AI have
been through Prolog, C++, Java and LISP. These programming languages provide facility
of creating various functions of business activity, extension of a function, handling
dynamic situations in business, providing uniformity in application etc.

A neuron is a micro cell which is connected to thousands of other micro cells in the br
ain and all the other parts of the human body containing nerves. It is a system which tries
to learn from the database and the manager then decides what the right answer is. The
entire neural network is realized in the form of software. The software renders the computer
as a problem solver. The neural networks goes on building strong database for
problem solving depending upon the decisions taken by the manager in the form of
response confirmation given to the system by the manager. Neural networks can be
used in various business applications like forecasting, stock analysis, market analysis etc.

Advantages of Neural Networks Neural networks are used to forecast some complex
data patterns. When designed properly, they can be used as experts for a particular
project. They have the ability to adjust to the changing environment and thus are
very flexible. For example, it can forecast net asset values of mutual funds.

Artificial intelligence is a field of science and technology based on disciplines

such as computer science, biology, psychology, linguistics, mathematics and engineering.
The goal of AI is to develop computers that can simulate the ability to think, see, hear,
walk, talk and feel. In other words, simulation of computer functions normally
associated with human intelligence, such as reasoning, learning and problem solving. AI
can be grouped under three major areas: cognitive science, robotics and natural
interfaces. Cognitive science focuses on researching on how the human brain works and how
humans think and learn. Applications in the cognitive science area of AI include the develop
ment of expert systems and other knowledgebased systems that add a knowledge base
and some reasoning capability to information systems. Also included are adaptive
learning systems that can modify their behavior based on information they acquire as they
operate. Chessplaying systems are some examples of such systems.

Fussy logic systems can process data that are incomplete or ambiguous. Thus, they
can solve semi structured problems with incomplete knowledge by developing approximate
inferences and answers, as humans do.

Neural network software can learn by processing sample problems and their
solutions. As neural nets start to recognize patterns, they can begin to program themselves to

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solve such problems on their own. Neural networks are computing systems modeled after
the human brain’s mesh like network of interconnected processing elements, called
neurons. The human brain is estimated to have over 100 billion neuron brain cells. The
neural networks are lot simpler in architecture. Like the brain,
the interconnected processors in a neural network operate in parallel and interact dynamically
with each other.

This enables the network to operate and learn from the data it processes, similar to the
human brain. That is, it learns to recognize patterns and relationships in the data. The
more data examples it receives as input, the better it can learn to duplicate the results of the
examples it processes. Thus, the neural networks will change the strengths of the
interconnections between the processing elements in response to changing patterns in the
data it receives and results that occur.

For example, neural network can be trained to learn which credit characteristics result
in good or bad loans. The neural network would continue to be trained until it
demonstrated a high degree of accuracy in correctly duplicating the results of recent cases.
At that point it would be trained enough to begin making credit evaluations of its own.

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 ASSIGNMENTS - MBA – II SEMESTER

MB0031 (4 CREDITS)

SET 2

MANAGEMENT INFORMATION SYSTEMS

Q.1:- Explain the different business models that work together in an E-enterprise
system. Give example for each.

Ans:- Managing an E-business & Challenges before an E-business -Due to Internet

capabilities and web technology, traditional business organization definition has undergone a
change where scope of the enterprise now includes other company locations, business
partners, customers and vendors. It has no geographic boundaries as it can extend its
operations where Internet works. All this is possible due to Internet and web moving
traditional paper driven organization to information driven Internet enabled E-business
enterprise. E-business enterprise is open twenty-four hours, and being independent,
managers, vendors, customers transact business any time from anywhere. Internet capabilities
have given E-business enterprise a cutting edge capability advantage to increase the business
value. It has opened new channels of business as buying and selling can be done on Internet.
It enables to reach new markets across the world anywhere due to communication
capabilities. It has empowered customers and vendors / suppliers through secured access to
information to act, wherever necessary. The cost of business operations has come down
significantly due to the elimination of paper-driven processes, faster communication and
effective collaborative working. The effect of these radical changes is the reduction in
administrative and management overheads, reduction in inventory, faster delivery of goods
and services to the customers.

In E-business enterprise traditional people organization based on 'Command Control'

principle is absent. It is replaced by people organization that is empowered by information
and knowledge to perform their role. They are supported by information systems, application
packages, and decision-support systems. It is no longer functional, product, and project or
matrix organization of people but E-organization where people work in network environment
as a team or work group in virtual mode. E-business enterprise is more process-driven,
Technology-enabled and uses its own information and knowledge to perform. It is lean in
number, flat in structure, broad in scope and a learning organization. In E-business enterprise,
most of the things are electronic, use digital technologies and work on databases, knowledge
bases, directories and document repositories. The business processes are conducted through
enterprise software like ERP, SCM, and CRM supported by data warehouse, decision
support, and knowledge management systems. Today most of the business organizations are
using Internet technology, network, and wireless technology for improving the business
performance measured in terms of cost, efficiency, competitiveness and profitability. They
are using E-business, Ecommerce solutions to reach faraway locations to deliver product and

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services. The enterprise solutions like ERP, SCM, and CRM run on Internet (Internet /
Extranet) & Wide Area Network (WAN). The business processes across the organization and
outside run on E-technology platform using digital technology. Hence today's business firm is
also called E-enterprise or Digital firm.

The paradigm shift to E-enterprise has brought four transformations, namely:

1. Domestic business to global business.

2. Industrial manufacturing economy to knowledge-based service economy.
3. Enterprise Resource Management to Enterprise Network Management.
4. Manual document driven business process to paperless, automated,
Electronically transacted business process.

These transformations have made conventional organization design obsolete.

In E-enterprise, business is conducted electronically. Buyers and sellers through

Internet drive the market and Internet-based web systems. Buying and selling is possible on
Internet. Books, CDs, computer, white goods and many such goods are bought and sold on
Internet. The new channel of business is well-known as Ecommerce. On the same lines,
banking, insurance, healthcare are being managed through Internet E-banking, E-billing, E-
audit, & use of Credit cards, Smart card, ATM, E-money are the examples of the Ecommerce
application. The digital firm, which uses Internet and web technology and uses E-business
and Ecommerce solutions, is a reality and is going to increase in number.

MIS for E-business is different compared to conventional MS design of an

organization. The role of MIS in E-business organization is to deal with changes in global
market and enterprises. MIS produces more knowledge-based products. Knowledge
management system is formally recognized as a part of MIS. It is effectively used for
strategic planning for survival and growth, increase in profit and productivity and so on. To
achieve the said benefits of E-business organization, it is necessary to redesign the
organization to realize the benefits of digital firm. The organization structure should be lean
and flat. Get rid of rigid established infrastructure such as branch office or zonal office.
Allow people to work from anywhere. Automate processes after reengineering the process to
cut down process cycle time. Make use of groupware technology on Internet platform for
faster response processing. Another challenge is to convert domestic process design to work
for international process, where integration of multinational information systems using
different communication standards, country-specific accounting practices, and laws of
security are to be adhered strictly. Internet and networking technology has thrown another
challenge to enlarge the scope of organization where customers and vendors become part of
the organization. This technology offers a solution to communicate, coordinate, and
collaborate with customers, vendors and business partners. This is just not a technical change
in business operations but a cultural change in the mindset of managers and workers to look
beyond the conventional organization. It means changing the organization behaviour to take
competitive advantage of the E-business technology.

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 The last but not the least important is the challenge to organize and implement
information architecture and information technology platforms, considering multiple
locations and multiple information needs arising due to global operations of the business into
a comprehensive MIS. E-COMMERCE is a second big application next to ERP. It is essential
deals with buying and selling of goods. With the advent of intent and web technology, E-
Commerce today covers an entire commercial scope online including design and developing,
marketing, selling, delivering, servicing, and paying for goods. Some E-Commerce
application add order tracking as a feature for customer to know the delivery status of the
order.

E-Collaboration helps work effectively on applications like calendaring and

scheduling tasks, event, project management, workflow application, work group application.
E-collaboration system components are internet, Intranet, Extranet and LAN, WAN networks
for communication through GroupWare tools, browser.

Let us illustrate the model using an event in the business such as receipt of material
for a job to be processed on the shop floor. In this event there is a transaction receipt of
material, which needs to be processed, and then a workgroup will use this information of
material receipt. Each member of this workgroup has a different goal.

Q.2:- What are the different emerging fields in MIS? Explain with an application of
your own for each.

Ans:- A Strategic Information System (SIS) is a system to manage information and assist in
strategic decision making. A strategic information system has been defined as, "The
information system to support or change enterprise's strategy."

A SIS is a type of Information System that is aligned with business strategy and
structure. The alignment increases the capability to respond faster to environmental changes
and thus creates a competitive advantage. An early example was the favourable position
afforded American and United Airlines by their reservation systems, Sabre and Apollo. For
many years these two systems ensured that the two carriers' flights appeared on the first
screens observed by travel agents, thus increasing their bookings relative to competitors. A
major source of controversy surrounding SIS is their sustainability.

SISs are different from other comparable systems as:

1. they change the way the firm competes.

2. they have an external (outward looking) focus.
3. they are associated with higher project risk.
4. they are innovative (and not easily copied).

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 It is mainly concerned with providing and organization and its members an assistance
to perform the routine tasks efficiently and effectively. One of the major issue before any
organization is the challenge of meeting its goals and objectives. Strategic IS enable such
organization in realizing their goals. Strategic Information System (SIS) is a support to the
existing system and helps in achieving a competitive advantage over the organizations
competitors in terms of its objectives. This unit deals with the critical aspects of the strategic
information system. This units indicates the theoretical concepts and the way in which the
same are realized in practice. The flow of the unit is in such a way that it starts
with the development of contemporary theory about strategic uses of corporations' internal
information systems leading to systems which transcend the boundaries of particular
organizations. The process whereby strategic information systems are created or identified is
then examined. A number of weaknesses in the existing body of theory are identified, and
suggestions made as to directions in which knowledge is or may be progressing. A strategic
information system is concerned with systems which contribute significantly to the
achievement of an organization's overall objectives. The body of knowledge is of recent
origin and highly dynamic, and the area has an aura of excitement about it. The emergence of
the key ideas, the process whereby strategic information systems come into being is assessed,
areas of weakness are identified, and directions of current and future development suggested.

Information system is regarded as a tool to provide various services to different

management functions. The tools have been developing year by year and the application of
the tool has become more and more diverse. In management it is now a very power means to
manage and control various activities and decision making process. The original idea of
automating mechanical processes got quickly succeeded by the rationalization and integration
of systems. In both of these forms, IS was regarded primarily as an operational support tool,
and secondarily as a service to management. Subsequent to the development, it was during
the last few years that an additional potential was discovered. It was found that, in some
cases, information technology (IT) had been critical to the implementation of an
organization's strategy. An organization’s strategy supported by information system fulfilling
its business objectives came to be known as Strategic Information System. The strategic
information system consists of functions that involved gathering, maintenance and analysis of
data concerning internal resources, and intelligence about competitors, suppliers, customers,
government and other relevant organizations.

Q.3:- How is MIS used for decision making in the organization?

Ans.:- Todays managers depend on information systems for decision making. The managers
have handful of data around them but manually they cannot process the data accurately and
with in the short period of time available to them due to heavy competition in modern world.
Therefore mangers depend on information systems.

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The concept of MIS

Management Management has been defined in a variety of ways, but for our
purposes it comprises the process or activities what managers do in the operation of their
organization: Plan, Organize, Initiate and Control operations.

Information Data are facts and figures that are not currently being used in a
decision processes and usually take the form of historical records that are recorded and filed
without immediate intent to retrieve for decision making.

Information consists of data that have been retrieved, processed or otherwise used for
information or inference purposes, argument, or as a basis for forecasting or decision
making.

System can be described simply as a set of elements joined together for a common
objective. A subsystem is is part of a larger system with which we are concerned. All systems
are part of larger systems.

The objective of an MIS (Management Information System) is to provide information

for decision making on planning, initiating, organizing, and controlling the operations of the
subsystems of the form and to provide a synergetic organization in the process.

Decision Support System: It is sometimes described as the next evolutionary step after
Management Information Systems (MIS) . MIS support decision making in both structured
and unstructured problem environments.. It supports decision making at all levels of the
organization .IS (Information Systems) are intended to be woven into the fabric of the
organizations , not standing alone. IS support all aspects of the decision making process.MIS
are made of people, computers, procedures, databases, interactive query facilities and so on.
They are intended to be evolutionary/adaptive and easy for people to use.

Methods of Decision Making MIS is a technique for making programmed decisions.

If we include the computer and management science as integral parts or tools of computer –
based information systems, the prospects for a revolution in programmed decision making
are very real. Just as a manufacturing process is becoming more and more automated so is the
automation of programmed decisions increasing to support this production and other
information needs throughout the organization.

Q.4:- Below is the list of data from a sample project

Most likely Immediate
Activity duration (Days) Predecessors to
activity
A 4 E,B
B 7 A,E

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 C 5 ---
D 11 C
E 9 ---

a. Draw the PERT network for the above data. Also draw the critical path for the
network.
b. Given the optimistic time estimate as 3, the most likely time estimate as 12 and the
pessimistic time estimate as 21, calculate the activity time estimate.

Ans:- (a) The critical path is that path which takes the longest time for start to end. The
critical path for the above mentioned network is as follows:-

C
2 5
A E

0
4
D 3 B

(b) to the optimistic time estimate = 3

tm the most likely time estimate = 12
tp the pessimistic time estimate = 21
te the activity time estimate = to + 4tm +tp
6
- ,- = 3 + 4(12) + 21
6
-,- = 12

Q.5:- Explain the difference between Intranet and Extranet

Ans:- Information Systems have grown powerful year after year. The role of the
traditional MIS has been obscured by newer software applications. Various applications
known collectively as enterprise resource planning (ERP) software has taken a dominant
position among large business applications. These packages, which typically come in
functional modules such as an accounting module, a human resources module, and a
manufacturing supply chain module, serve many of the functions that a traditional MIS
would, and they tend to be more flexible, integrated, and user-friendly
than legacy MIS. While early implementations of ERP suites were largely cross functional

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 databases with minimal high-level management tools, later upgrades have added
decision support and data manipulation tools to facilitate a wide range of analyses.

In future, MIS is likely to be verbal and qualitative in nature. It will depend upon the
strength of the organizations Information Systems. Most of the enterprises are growing and th
eir systems also have to grow. The ever growing demands of the systems will force out the ol
d conventional systems by newer systems. The next decade is going to witness several funda
mental and qualitative changes in the practice of management of commercial enterprises
and other types of organizations. These changes would be necessitated by better rates
of economic growth, intensification of competition, diversified and rapid technological
developments, continuing fluidity in economicpolitical environments, and sociopolitical
changes involving the values and attitudes of people working in organizations
at all levels.
To support these demands and meet newer challenges in the business, organizations
will have to resort to various technologies. This unit is based on such possible technologies
which will enable the enterprises to support their MIS.

Extranet An extranet is a private network that uses the Internet protocols and the public
telecommunication system to securely share part of a business's information or operations
with suppliers, vendors, partners, customers, or other businesses. An extranet can be viewed
as part of a company's intranet that is extended to users outside the company. An extranet
requires security and privacy.

A new buzzword that refers to an intranet that is partially accessible to authorized

outsiders. Whereas an intranet resides behind a firewall and is accessible only to people who
are members of the same company or organization, an extranet provides various levels of
accessibility to outsiders. You can access an extranet only if you have a valid username and
password, and your identity determines which parts of the extranet you can view.

An extranet is somewhat very similar to an intranet. Extranets are designed

specifically to give external, limited access to certain files of your computer systems to:

1. Certain large or privileged customers.

2. Selected industry partners.
3. Suppliers and subcontractors... etc.

Therefore, a carefully designed extranet can bring additional business to your

company. Intranets and extranets all have three things in common:

1. They both use secured Internet access to the outside world.

2. Both can drastically save your company or organization a lot of
money.
3. Both need a user ID & password to control access to the whole system.

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 The professional development team at My Web Services has the expertise and the
right tools to design the right intranet or extranet that will meet your exact needs, both for
today and the future.

Intranet An internal use, private network inside an organisation that uses the same kind
of software which would also be found on the Internet. Inter-connected network within one
organization that uses Web technologies for the sharing of information internally, not world
wide. Such information might include organization policies and procedures, announcements,
or information about new products.

An intranet is a restricted-access network that works like the Web, but isn't on it.
Usually owned and managed by a company, an intranet enables a company to share its
resources with its employees without confidential information being made available to
everyone with Internet access. A network based on TCP/IP protocols (an internet) belonging
to an organization, usually a corporation, accessible only by the organization's members,
employees, or others with authorization. An intranet's Web sites look and act just like any
other Web sites, but the firewall surrounding an intranet fends off unauthorized access. Like
the Internet itself, intranets are used to share information.

An intranet is an information portal designed specifically for the internal

communications of small, medium or large businesses, enterprises, governments, industries
or financial institutions of any size or complexity. Intranets can be custom-designed to fit the
exact needs of businesses no matter where they are situated. Users of intranets consists
mainly of:

1. Members of the executive team.

2. Accounting and order billing.
3. Managers and directors.
4. Sales people and support staff.
5. Customer service, help desk, etc.

Q.6:- Explain the control issues in management information systems.

Ans:- A management control systems (MCS) is a system which gathers and uses
information to evaluate the performance of different organizational resources like human,
physical, financial and also the organization as a whole considering the organizational
strategies. Finally, MCS influences the behavior of organizational resources to implement
organizational strategies. MCS might be formal or informal. The term ‘management control’
was given of its current connotations by Robert N. Anthony (Otley, 1994).

According to Maciariello et al. (1994), management control is concerned with

coordination, resource allocation, motivation, and performance measurement. The practice of
management control and the design of management control systems draws upon a number of
academic disciplines. Management control involves extensive measurement and it is

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therefore related to and requires contributions from accounting especially management
accounting. Second, it involves resource allocation decisions and is therefore related to and
requires contribution from economics especially managerial economics. Third, it involves
communication, and motivation which means it is related to and must draw contributions
from social psychology especially organizational behavior

Management control systems use many techniques such as

1. Balanced scorecard The balanced scorecard (BSC) is a strategic

performance management tool - a semi-standard structured report supported by proven design
methods and automation tools that can be used by managers to keep track of the execution of
activities by staff within their control and monitor the consequences arising from these
actions.

2. Total quality management (TQM) Total Quality Management (or TQM) is

a management concept coined by W. Edwards Deming. The basis of TQM is to reduce the
errors produced during the manufacturing or service process, increase customer satisfaction,
streamline supply chain management, aim for modernization of equipment and ensure
workers have the highest level of training. One of the principal aims of TQM is to limit errors
to 1 per 1 million units produced. Total Quality Management is often associated with the
development, deployment, and maintenance of organizational systems that are required for
various business processes.

3. Kaizen (Continuous Improvement) Kaizen (Japanese for "improvement" or

"change for the better") refers to a philosophy or practices that focus upon continuous
improvement of processes in manufacturing, engineering, supporting business processes, and
management. It has been applied in healthcare, government, banking, and many other
industries.

4. Activity-based costing Activity-based costing (ABC) is a costing model that

identifies activities in an organization and assigns the cost of each activity resource to all

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products and services according to the actual consumption by each: it assigns more indirect
costs (overhead) into direct costs. In this way an organization can precisely estimate the cost
of its individual products and services for the purposes of identifying and eliminating those
which are unprofitable and lowering the prices of those which are overpriced.

5. Target costing Target costing is a pricing method used by firms. It is defined

as "a cost management tool for reducing the overall cost of a product over its entire life-cycle
with the help of production, engineering, research and design". A target cost is the maximum
amount of cost that can be incurred on a product and with it the firm can still earn the
required profit margin from that product at a particular selling price.

6. Benchmarking and Benchtrending Benchmarking is the process of

comparing one's business processes and performance metrics to industry bests and/or best
practices from other industries. Dimensions typically measured are quality, time, and cost.
Improvements from learning mean doing things better, faster, and cheaper.

JIT: JIT may refer to:-

(a) Various meanings of Just In Time.

(b) Just-in-time compilation - a technique for improving the performance
of virtual machines in computing.
(c) Just-in-time (business) - a business inventory strategy.

7. Budgeting A budget (from old French bougette, purse) is generally a list of all
planned expenses and revenues. It is a plan for saving and spending.[1] A budget is an
important concept in microeconomics, which uses a budget line to illustrate the trade-offs
between two or more goods. In other terms, a budget is an organizational plan stated in
monetary terms.

8. Capital budgeting Capital budgeting (or investment appraisal) is the planning

process used to determine whether a firm's long term investments such as new machinery,
replacement machinery, new plants, new products, and research development projects are
worth pursuing. It is budget for major capital, or investment, expenditures.

9. Program management techniques, etc.

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