Management Information System

Management: Management is the process of planning and regulating the activities of an enterprise. it is commonly used to cover the formulating of policies, its execution, the designing of the organization and its employment. 2) Information: Information is the data that have been retrieved, processed, or otherwise used for informative purposes 3) System: A system is a set of element joined together for a common purpose. A sub-system is a part of large system with which we are concerned. but all system are part of large systems.
1)

Management Functions
Planning Devise short-range and long-range plans and set goals to help achieve the plans Organizing How to use resources Staffing Directing Guiding employees to perform their work Controlling Monitoring progress towards goals

Get the job done On time Within budget Satisfactoril y Using available resources

Management Levels

Flattening the pyramid

Data + Organization Set of formal business systems designed to provide information for an organization. MIS is a system in which defined data are collected, processed and communicated to assist those responsible for the use of resources. MIS is an integrated man/machine system for providing information to support the operations, management and decision making function in an organization. MIS is a system that aids management in making, carrying out and controlling decisions.

Management Information System (MIS)

Role of MIS

MIS is the networking of information that supports management decision making. The role of MIS in business is to identify the information needs at different level of management and prepare a system to satisfy those needs satisfactorily.
Determination of information needs Data gathering and Processing

Evaluation Indexing Abstraction

Dissemination

Storage

Information Use

1.MIS is an integrative system (activities of each are interrelated to others) 2.MIS is a subsystem concept 3.MIS provides relevant information to management 4.MIS is flexible (it can be easily modified) 5.MIS enhances productivity 6.MIs is coordinated system 7.MIS is a feedback system 8.MIS is management Oriented 9.Management Directed 9.MIS is common database 10.MIS is distributed data processing (DDP) [DDP can be thought of as the delivery system, placing the information in the hands of those who need it when they need it] 11.MIS is a computerized system 12.MIS transforms Data into Information

Characteristics of MIS

Nature of MIS 1)Report Orientation 2)Action Oriented 3) Exception Oriented (MIS is related to the exceptional situation of the business rather than routine matters) 4)Data- Base Orientation (use common data base which can be used by any individual accordingly) 5)End user Orientation Application of MIS
1.Strategy support 2.Data processing

Objectives of MIS

Organization must be very clear about the need of information required by the different levels of management. Following are the reason of adoption of MIS: To store and manage data efficiently from all the functional areas of business To process the collected data and derive information out of them To provide information quickly as and when required. To collect and store data for the purpose of internal research. To provide the information for planning, organizing, controlling purposes, regarding production and inventory and financial health of the organization. To speed up the execution of the results with the reliable data available. To smooth up the flow of data through various levels of the organization.

Functions of MIS
Collect Data The first function of MIS is to determine the information needed to make decisions and to organize it into a database. A Database is an integrated collection of data stored in one place for efficient access and information processing. Store and process data After creation of data, a database must be stored and processed information useful to managers. Present information to managers After storing and processing, the next step is to present the information to managers for their use.

Decision Support System The term decision support system (DSS) refers to a class of systems, which support the process of making decisions. The emphasis is on Support rather than on automation of research. DSS allow the decision maker to retrieve the data and test alternative solutions during the process of problem solving. DSS is a specialized MIS designed to support an Executives skills at all stages of decision making i.e, Problem identification, selecting relevant data, picking the approach to be used in decision making and evaluating the alternative courses of action. The DSS enables the business executives to take the efficient, effective and economic decisions.

DSS are computer based information systems that provide interactive information support to managers and business professionals during the decision making process. Decision Support Systems use: 1)Analytical Models 2)Specialized databases 3)A decision makers own insights and Judgments, and 4)An interactive computer based modeling process to support the making of semi structured and unstructured business decisions.

Information, decision and Management Decision Structure

Unstructured Information characteristics

Semi-structured

Strategic Management

Ad Hoc Unscheduled summarized infrequent forward looking

Pre-specified Scheduled Detailed Frequent Structured Historical Internal Narrow Operational management Fig. Information Requirements for Decision makers Focus Operating Managers And Self directed teams Tactical Management Business Unit Managers and self directed teams

Characteristics of DSS
1)Provide rapid access to information 2)Handle large amounts of data from different source 3)Provide report and presentation flexibility 4)Offer both Textual and Graphical Orientation 5)Support Drill- Down Analysis 6)Perform Complex, Sophisticated Analysis and comparisons using advanced software packages

Components of DSS
1)Hardware Resources (executive workstations connected through networks) 2)Software Resources DSS software packages are called DSS generators. They contain models of databases, model and Dialogue managers. A Database management module provides the creation, interrogation and maintenance of the DSS database. A Model base management module provides the ability to create, maintain, and manipulate the mathematical models in the model base using the capabilities provided by modeling packages. A dialogue generation and management module provides an attractive user interface that support interactive input and output by managers

3)Data Resource: DSS contains data and information most needed by the managers for specific type of decision 4)Model Resource : The model base includes a library of mathematical models and analytical techniques stored in a variety of program modules and files. 5)People Resource : The managers or their staff specialists to explore decision alternatives can use a DSS. 6)Decision Support System Packages: Many DSS generators are available from Independent consulting firm and computer manufacturers. IFPS-Personal (Interactive Financial Planning system), SAS systems and SPSS-X are used as DSS generators for decision support that require extensive statistical analysis and EXCEL.

Fig. Components of Decision Support Systems

Model Base

DSS Generation
Manager Interactive Decision Support System Model Base Management Dialogue Generation Management Data base Management

Management workstations

Data Base

Functions of DSS 1)What-If Analysis: In what-if analysis, an end user makes changes to variables, or relationship among variables, and observes the resulting changes in the value of other variables. It is used to explore major changes in the parameters. e.g. what if we cut advertisement by 10 percent? What would happen to sales? 2) Sensitivity Analysis: It is a special case of what-if analysis. In this typically, the value of only one variable is changed repeatedly and the resulting changes on other variable are observed. e.g. let us cut advertising by Rs.100 repeatedly so we can see its relationship to sales.

3)Goal Seeking Analysis: Goal seeking analysis reverses the direction of the analysis done in what if analysis and sensitivity analysis. Goal seeking Analysis (how can analysis) sets a target value (a goal) for a variable and then repeatedly changes other variables until the target value is achieved. e.g. let us try increase in advertising until sales reach 1 million 4)Optimization Analysis: It is a more complex extension of goal seeking analysis. Instead of setting a specific target value for a variable, the goal is to find the optimum value for one or more target variables, given certain constraints . e.g. what is the best amount of advertising to have, given our budget and choice of media?

Types of DSS
There are two types of DSS systems, model driven and data driven. 1)Model Driven DSS :These systems are stand alone systems isolated from major organizational information systems that use some type of model to perform what-if analysis and other kinds of analysis. 2)Data Driven DSS : These systems analyzed large pools of data found in major organizational systems. They support decision making by allowing users to extract useful information that was previously buried in large quantities of data

Applications of DSS
1)Independent problems: These are Standalone problems whose solutions are independent from other problems 2)Interrelated Problems: In these problems solutions are interrelated by each other, to find the most effective solution to the group of interrelated problems. 3)Organizational problems: In this all department of organization are included. such problems require team effort

Benefits OF DSS
1)Improving Personal Efficiency 2)Improving problem solving 3)Facilitating communications 4)Promoting Learning and training 5)Incresing Organizational control

EXECUTIVE INFORMATION SYSTEM

Executive Information System (EIS) is a type of management information system intended to facilitate and support the information and decision making needs of senior executives by providing easy access to both internal and external information relevant to meeting the strategic goals of the organization. It is a specialized form of DSS. The first goal of EIS is to provide top executives with immediate and easy access to information about a firms critical success factors (CSFs), that is. key factors that are critical to accomplishing an organizations strategic objectives.

EIS is also called Executive Support Systems, it supports decision making of members of the Board of Directors, who are responsible to stockholders. These top level decision making strata are shown in fig.
Board of Directors

President

Functional Area Vice President

Functional Area Managers

Fig. Layers of Executive Decision Making

Characteristics of EIS 1)Are tailored to Individual Executives 2)Are easy to use 3)Have drill down Abilities 4)Support the need for external data 5)Can help with situations that have a high degree of uncertainty 6)Have a future orientation 7)Are linked with value- added Business processes

Components of EIS

1) Hardware a) Input data entry device b) The central processing unit c) Data storage files d) Output devices 2) Software a) Text base software b) Database c) Graphic base d) Model base 3) Interface (in forms, reports, question/answer) 4) Telecommunication

Capabilities of EIS 1)Support 2)Support 3)Support 4)Support 5)Support for for for for for Defining an Overall Vision strategic planning strategic staffing strategic control Crisis Management

Advantages of EIS
1)

2)
3) 4) 5)

6)

Easy for upper level executives to use, extensive computer experience is not required in operations. Provides timely delivery of company summary information Information that is provided is better understood Filters data for management Improves tracking of information Offers efficiency to decision makers.