Management Information Systems

ManagementInformation

Systems

| Faculty | Sushant Sharma |SUSHANT SHARMA

MIS: A Definition:

• An MIS is– An integrated (computer-based) user-

machine system– For providing information– To support decision-making functions– In an organization

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Understanding –System&Environment

Data &Information –Technical&Business dimensions

Components of Computer basedInformation systems

Business applications ofvarious Information Systems

Functional Information Systems

Models of File Organization

Data –structures Models

Understanding SystemDevelopment Life Cycle

Benefits of Increased capabilitiesof IT

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Learning Goals

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What is Management Information System?

• Subset of the overall internal control procedures, in a business,which covers the application of people, documents,technologies and procedures used by managementaccountants to solve business problems such as costing aproduct, service or a business wide strategy.

• Distinct from regular information systems - analyze otherinformation systems applied in operational activities in theorganization.

• The system utilizes:– Computer hardware and software– Manual procedures– Models for decision-making, and– A database

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MIS Characteristics:• System approach

– Takes Comprehensive view in the light of its objective

• Management oriented– Top down approach followed– Derived from the overall business objectives

• Need based– Caters to info needs at different levels

• Exception based

• Exception based reporting principle

• Futuristic– On the basis of projections

• Integrated– Blends info from several operational areas

• Common data flows– Should avoid data duplication and redundancy

• Long term basis– Strive to be futuristic

• Divide and conquer– Use partitioning into subsystems

• Central database– Let subsystems access the master data

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Systems

• A SYSTEM is a set of interrelated andinterdependent elements such as people, resources,concepts, and procedures intended to perform anidentifiable function or to serve a goal.

• System Levels (Hierarchy): All systems aresubsystems interconnected through interfaces

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The Structure of a SystemThree Distinct Parts of Systems

• Inputs• Processes• Outputs

Systems• Are surrounded by an environment• Frequently include a feedback mechanism

A human, the decision maker, is usuallyconsidered part of the system

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Business System

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Closed and Open Systems

• A Closed System is totally independent of other systems andsubsystems: Do not interact, or exchange any inputs or outputswith its environment

• An Open System is very dependent on its environment:Interacts with its environment, exchanges inputs and outputs

a continuum

Defining manageable boundaries is closing thesystem

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Six stages of processing• Input: Data capturing - collecting and entering the data into the

information system.

• Data Processing: here the data is manipulated into

information using mathematical, statistical and other tools.

• Output: the information is displayed or presented.

• Storage: data and information are maintained for later use.

• Retrieval

• Dissemination of MI – finished product of MIS

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Information• Processed data, presented in a form which assists

decision-makers

• May contain an element of surprise, reduceuncertainty

• May provoke a manager to initiate action

• Data and Info – relative concepts– Recency– Producer-consumer relationship

• Often used interchangeably

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Characteristics of useful information-Technical Dimensions

• Response Time : Time lapse between the time when query is made andthe time when the results are actually produced . Least response timepreferred . Achieved through capabilities of hardware &software.

• Relevant: the information must be pertaining to the problem at hand.

• Capacity –Condensed and precise reports in the form of analysis of trendinstead of tabular formats.

• Complete: partial information is often worse than no information.

• Accurate: erroneous information might lead to disastrous decisions.

• Recency /Current/Validity : decisions should be based on the latestinformation available, because what was a fact yesterday might no longerbe one today.

• Economical: in business setting ,the cost of obtaining information must beconsidered as one cost element involved in any decision.

• Security : Users security and privacy of data to be ensured

• Interrelations of data elements – Sharing of data across the organizationsSUSHANT SHARMA

Characteristics of useful information-Business Dimensions

Structuredness: The information is structured if it can be discretely defined, forexample, the daily invoice is structured information as it clearly states the need.However, information of high-income group people is unstructured as it does notclearly state the income limit of the high income group.

Programmability: It is the ease with which the process of performing a task canbe defined. The approval of a supplier on the basis of the lowest quote is adecision which can be explained to anyone; thus, it is programmable. However, adecision to approve tenders on the basis of product quality is a vague thing toexplain and can not be easily programmed.

External Scope: Information is external if it belongs to the environment outsidethe system boundaries e.g., the data about sales of a competitor gives externalinformation, whereas the data about the sales of our department generatesinternal information.

Time Scope: Information may deal with the future or the past of the company.Accordingly, it is termed as futuristic or historical. The financial projections for thenext quarter refer to futuristic data whereas the profits and loss statement for thefinancial year present historical data.

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• IS – a set of interrelated components workingtogether to collect, retrieve, process, store, anddistribute information for the purpose of facilitatingplanning, control, coordination, analysis, anddecision making in business organizations

• Input-process-output perspective-Accepts inputsand processes data to provide information todecision makers and helps decision makerscommunicate their resultsPeople-organization-technology perspective

• Is often at the heart of many organizations

What is IS?

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Technology – the means by which data is transformed and organized for business use:HardwareSoftwareDatabaseTelecommunication

People – the users of ISOrganization -- a collection of functional units working together to achieve a common goal

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Computer software, is the collection of computer programs and related data that providethe instructions telling a computer what to do and how to do it

Computer hardware refers to the physical parts of a computer and related devices.Internal hardware parts of a computer are often referred to as components. Externalhardware devices are usually called peripherals

TELECOMMUNICATIONS-Science and technology associated, in general, withcommunications at a distance. A telecommunications system requires a analogy or digitaltransmitter, a compatible receiver, and a physical (cable or wire) or non-physical(wireless) connection

People -Information systems professionals who analyze organizational informationneeds, design and build information systems, prepare computer programs

Procedures refers to rules for achieving optimal and secure operations in dataprocessing

Data refers to representation of facts, concepts, or instructions in a formalized mannersuitable for communication, interpretation, or processing by humans or by automaticmeans

MAIN COMPONENTS OF INFORMATION SYSTEMS

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Data, Information, Knowledge

• Relationships – simple just in textbooks

Data(Letters, numbers, graphics…

Representing reality and knowledge)

Information(Data understood,

meaning)

Knowledge(Complex cognitive entity;

cause-effect theories,vocabularies/conceptual maps,

know-how, experience)

Domain ofTechnology

Domain of Human Brain

More…

• Knowledge is also embedded in computer software! (e.g., mathoperations in Excel, procedures in Accounting IS, decision trees inExpert Systems)

• In plain English, we often do not differentiate between data,information and knowledge, simply calling it all “information”.

Sources of Management Information

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Data, Information, Knowledge and Occupations

Professionals

Clerks

Managers

• Where the primary focus of job is.

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• What do we mean by "IT"?Any tool for manipulating data, information

- electronic: computer software and hardware - our focus

_Concept of Information Technology (IT)_Concept of Information Technology (IT)

- paper: documents, filing techniques… - still there,gradually transformed into electronic

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Data

Information

Knowledge

Informationis a

differencethat makes a

difference

unstructured,uninformed

facts

To conceive ofknowledge as a

collection ofinformation seems to

rob the concept of all ofits life... Knowledge

resides in the user andnot in the collection. Itis how the user reacts

to a collection ofinformation that

matters(Experience)

Understanding the nature of information

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Concept of Information System (IS, system)

Information Technology (IT)(Computers, Other)

Users(Organizational members:

Managers, Professionals, Clerks)

• Data (organized,meaningful)

• Representations ofKnowledge

UseProcedures

InformationSystem (IS)

UseInformation,Knowledge

-----------------Task, Business

ProcessPerform on

Supports

• In plain English, we often do not differentiate between data, informationand knowledge, simply calling it all “information”.

• We often use term “technology” to refer to either IT or IS.SUSHANT SHARMA

ManagementInformation

System-Types

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(I). TRANSACTION PROCESSING SYSTEM

A Transaction Processing System(TPS) is a type of informationsystem that collects, stores,modifies and retrieves the datatransactions of an enterprise.

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Characteristics of TPS

Support operationManagement and controlRoutine, normal operations

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Transaction Processing Functions

1. Book Keeping- keeping accurate records of a firm’s business transactions2. Data Gathering – TPS gathers data that describes firm’s internal actions and environmental

transactions .Assigning specific responsibility for data gathering . Key function for IS accuracy3. Data Editing –4. Data Manipulation- classification , sorting ,calculating , summarizing the data5. Data storage – stored securely until needed for usage –reliable storage media6. Issuance- refers to production of such documents as reqd. by individuals . Generation of

document not needing any complex logic of computation. These are generally schedule or eventdriven

7. Information documents – documents to verify ,confirm /prove the transactions occurred eg. Salesreceipt , order confirmations ,customer invoices etc

8. Turnaround documents – Documents used as output and input forms simultaneously .An Invoicecan be used as turnaround document which gets the feedback of the customer ,to be fed inanother set of data .

9. Error reports – record of errors occurred in recording of transactions10. Control reports – detailed listing that describe each transaction occurring during specific time

period . Also called transaction logs . Eg, Payroll register, a journal a cash register.

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Structured vs. Unstructured Problems

• Structured problems lend themselves toprogrammed decisions– The implication is that a repeatable process

can be employed and these can beautomated

• Unstructured problems require unprogrammeddecisions– Can be addressed (or partially addressed) with

Decision Support Systems

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Structured Problems• Can be addressed by an MIS• Three decision models or techniques

– Optimization• Find the best solution

– Satisficing• Find a solution which meets certain criteria

– Heuristics• Rule-based solution generation

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Corporatedatabasesofinternaldata

Databasesofexternaldata

Databasesofvalidtransactions

Operationaldatabases

Transactionprocessingsystems

Managementinformationsystems

Decisionsupportsystems

Executivesupportsystems

Expertsystems

Businesstransactions

Input anderror list

Drill-down reportsException reportsDemand reports

Key-indicator reports

Scheduledreports

Employees

Corporateintranet

Applicationdatabases

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(II). Management Reporting System• Provide managers with pre-defined types of

information for relatively structured type ofdecisions .

• Regular, routine operations• Planning &Control Functions -Control, organize and

plan better• Closely linked to and fed by TPS• Output, or reports, are usually generated

through accumulation of transactionprocessing data

• Each MIS is an integrated collection ofsubsystems, which are typically organizedalong functional lines within an organization

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Characteristics of a ManagementReporting System

• Provides reports with fixed and standardformats– Hard-copy and soft-copy reports

• Uses internal data stored in the computersystem

• End users can develop custom reports• Requires formal requests from users

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Management Information Systemsfor Competitive Advantage

• Provides support to managers as theywork to achieve corporate goals

• Enables managers to compare results toestablished company goals and identifyproblem areas and opportunities forimprovement

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Outputs of aManagement Information System

• Inputs: Information from the TPS• Outputs: hard and softcopy reports

1. Scheduled reports– Produced periodically, or on a schedule (daily, weekly, monthly)

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

3. Demand report– Gives certain information at a manager’s request

4. Exception report– Automatically produced when a situation is unusual or requires

management action

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Scheduled Report Example

Daily Sales Detail ReportPrepared: 08/10/xx

Order#

CustomerID

SalesRep ID

ShipDate Quantity Item # Amount

P12453 C89321 CAR 08/12/96 144 P1234 3,214P12453 C89321 CAR 08/12/96 288 P3214 5,660P12453 C03214 GWA 08/13/96 12 P4902 1,224P12455 C52313 SAK 08/12/96 24 P4012 2,448P12456 C34123 JMW 08J/13/96 144 P3214 720

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Key Indicator Report Example

Daily Sales Key Indicator Report

ThisMonth

LastMonth

LastYear

Total Orders Month to Date Rs1,808 Rs1,694 Rs1,014

Forecasted Sales for the Month Rs2,406 Rs2,224 Rs2,608

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Demand Report Example

Daily Sales by Sales Rep Summary ReportPrepared: 08/10/xx

Sales Rep ID AmountCAR Rs42,345GWA Rs38,950SAK Rs22,100JWN Rs12,350

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Exception Report Example

Daily Sales Exception Report – ORDERS OVER Rs10,000Prepared: 08/10/xx

Order#

CustomerID

SalesRep ID

ShipDate Quantity Item # Amount

P12453 C89321 CAR 08/12/96 144 P1234 Rs13,214

P12453 C89321 CAR 08/12/96 288 P3214 RS15,660

P12453 C03214 GWA 08/13/96 12 P4902 Rs11,224

… … … … … … …… … … … … … …

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Outputs of a ManagementInformation System

Earnings by Quarter (Millions)

Actual Forecast Variance

2ND Qtr 1999 Rs12.6 Rs11.8 6.8%

1st Qtr 1999 Rs10.8 Rs10.7 0.9%

4th Qtr 1998 Rs14.3 Rs14.5 -1.4%

3rd Qtr 1998 Rs12.8 Rs13.3 -3.0%

Drill Down ReportsProvide detaileddata about asituation.

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Decision Making• Decision: a reasoned choice among alternatives• Examples:

– Where to advertise a new product– What stock to buy– What movie to see– Where to go for dinner

Decision Making: a process of choosing amongalternative courses of action for the purposeof attaining a goal or goals

Decision making vs. problem solving?• ART or SCIENCE?

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The Decision-Making Process

Systematic Decision-Making Process (Simon’sModel)

• Intelligence• Design• Choice• Implementation

Modeling is Essential to the Process

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Simon’s Model

Problem Identification

QualitativeAnalysis

QuantitativeAnalysis

Decision

External Internal

AI, EIS

ESDbDSS,MbDSS

GDSS

ES

DSS

Intelligence

Design

Choice

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DataManagement

ModelManagement

KnowledgeManagement

User Interface

User

OtherSystems

DSS Architecture components

1. Data Management Subsystem2. Model Management Subsystem3. Knowledge Management Subsystem4. User Interface Subsystem5. The User

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• Intelligence phase– Reality is examined– The problem is identified and defined

• Design phase– Representative model is constructed– The model is validated and evaluation criteria are

set• Choice phase

– Includes a proposed solution to the model– If reasonable, move on to the

• Implementation phase– Solution to the original problem

Failure: Return to the modeling processOften Backtrack / Cycle Throughout the Process

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Scan the environment to identify problem situations oropportunities

• Identify organizational goals and objectives• Determine whether they are being met• Explicitly define the problem

Classify the problemDecompose into sub-problemsIs it my problem (ownership)Can I solve it

Outcome: Problem statement

1. The Intelligence Phase

Problem or Symptom?SUSHANT SHARMA

2. The Design Phase

• Generating, developing, and analyzingpossible courses of action

Includes• Understanding the problem• Testing solutions for feasibility• A model is constructed, tested, and validated

Modeling• Conceptualization of the problem• Abstraction to quantitative and/or qualitative forms

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Types of DecisionsType of structure - Nature of task

Level of decision making - Scope

Structured Unstructured

Strategic

Managerial

Operational

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Nature of Decision• Structured Problems

– Routine and repetitive with standard solution– Well defined decision making procedure– Given a well-defined set of input, a well defined set of

output is defined• Semi-structured Problems

– Has some structured aspect– Some of the inputs or outputs or procedures are not well

defined• Unstructured Problems

– All phases of decision making process are unstructured– Not well defined input, output set and procedures

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(III) Concept of DecisionSupport Systems (DSS)

Scott Morton [1971]DSS are interactive computer-based systems, which helpdecision makers utilize data and models to solveunstructured problems [1971]

Keen and Scott Morton [1978]Decision support systems couple the intellectual resourcesof individuals with the capabilities of the computer to improvethe quality of decisions. It is a computer-based supportsystem for management decision makers who deal withsemi-structured problems.

DSS: means different things to different peopleThere is no universally accepted definition of DSS

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Working Definition of DSS

• A DSS is an interactive, flexible, and adaptableCBIS, specially developed for supporting thesolution of a non-structured management problemfor improved decision making. It utilizes data, itprovides easy user interface, and it allows for thedecision maker’s own insights

• DSS may utilize models, is built by an interactiveprocess (frequently by end-users), supports all thephases of the decision making, and may include aknowledge component

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Components of a DSS architecture

The database (orknowledge base),

The model (i.e.,the decisioncontext and

user criteria),and

The userinterface.

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(A) The Data ManagementSubsystem

• DSS database• Database management system• Data directory• Query facility

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DSS In Focus: The Capabilities of DBMS in a DSSCaptures/extracts data for inclusion in a DSS databaseUpdates (adds, deletes, edits, changes) data records and filesInterrelates data from different sourcesRetrieves data from the database for queries and reportsProvides comprehensive data security (protection fromunauthorized access, recovery capabilities, etc.)Handles personal and unofficial data so that users can experimentwith alternative solutions based on their own judgmentPerforms complex data manipulation tasks based on queriesTracks data use within the DSSManages data through a data dictionary

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DSS Database Issues

• Data warehouse• Special independent DSS databases• Extraction of data from internal, external and

private sources• Web browser access of data• Multimedia databases• Object-oriented databases• Commercial database management systems

(DBMS)

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(B) The Model ManagementSubsystem

• Mirrors the database managementsubsystem

Model Management Issues• Model level: Strategic, managerial (tactical)

and operational, model building blocks• Modeling languages• Model execution, integration

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DSS In Focus : Major Functions (Capabilities) of the MBMSCreates models easily and quickly, either from scratch or from existingmodels or from the building blocks.Allows users to manipulate the models so they can conductexperiments and sensitivity analyses ranging from “what-if” to goalseeking.Stores, retrieves, and manages a wide variety of different types ofmodels in a logical and integrated manner.Accesses and integrates the model building blocks.Catalogs and displays the directory of models for use by severalindividuals in the organization.Tracks models data and application use.Interrelates models with appropriate linkages with the database andintegrates them within the DSS.Manages and maintains the model base with management functionsanalogous to database management: store, access, run, update, link,catalog, and query.Uses multiple models to support problem solving.

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(C )The Knowledge ManagementSubsystem

• Provides expertise in solving complex unstructuredand semi-structured problems

• What models to use, how, interpreting results• Reasoning, handling uncertainty, learning from data• Expertise provided by an expert system or other

intelligent system (AI techniques)• Leads to intelligent DSS• Example: Data mining• Data Mining for Decision Support

– Software analyzes vast amounts of data– Attempts to discover patterns, trends, & correlations– May perform regression, decision tree, neural network, cluster

detection, or market basket analysis•

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(D) The User Interface (Dialog)Subsystem

• Includes all communication between auser and the MSS

• To most users, the user interface is thesystem

• Managers• Staff specialists• Intermediary:

1.Staff assistant2.Expert tool user3.Business (system)analyst4.Group DSS Facilitator

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DSS In Focus : Major Capabilities of the UIMS

Provides graphical user interface.Accommodates the user with a variety of input devices.Presents data with a variety of formats and outputdevices.Gives users “help” capabilities, prompting, diagnosticand suggestion routines, or any other flexible support.Provides interactions with the database and the modelbase.Stores input and output data.Provides color graphics, three-dimensional graphics, anddata plotting.Has windows to allow multiple functions to be displayedconcurrently.Can support communication among and between usersand builders of MSS.Provides training by examples (guiding users through theinput and modeling process).Provides flexibility and adaptiveness so the MSS will beable to accommodate different problems andtechnologies.Interacts in multiple, different dialog styles.Captures, stores, and analyzes dialog usage (tracking), toimprove the dialog system. Tracking by the user is alsoavailable.

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Distinguishing DSS fromManagement Science and MIS

• DSS is a problem solving tool and isfrequently used to address ad hoc andunexpected problems

• Different than MIS• DSS evolve as they develop

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Table --The Major Characteristics of MIS, MS /OR, and DSS

Management Information Systems

The main impact has been on structured tasks, where standard operatingprocedures, decision rules and information flows can be reliable predefined.

The main payoff has been in improving efficiency by reducing costs, turnaroundtime, and so on, and by replacing clerical personnel.

The relevance for managers’ decision making has mainly been indirect; forexample, by providing reports and access to data.

Management Science/Operations Research

The impact has mostly been on structured problems (rather than tasks), wherethe objective, data, and constraints can be prespecified.

The payoff has been in generating better solutions for given types of problems.

The relevance for managers has been the provision of detailed recommendationsand new methodologies for handling complex problems.

Decision Support Systems

The impact is on decisions in which there is sufficient structure for computerand analytic aids to be of value but where the manager’s judgment is essential.

The payoff is in extending the range and capability of computerized managers’decision processes to help them improve their effectiveness.

The relevance for managers is the creation of a supportive tool, under their owncontrol, that does not attempt to automate the decision process, predefineobjectives, or impose solutions.

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Models

• Major Component of DSS

• Use Models instead of experimenting on the realsystem

• A model is a simplified representation or abstractionof reality.

• Reality is generally too complex to copy exactly

• Much of the complexity is actually irrelevant inproblem solving

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Degrees of Model Abstraction(Least to Most)

• Iconic (Scale) Model: Physical replica of a system

• Analog Model behaves like the real system butdoes not look like it (symbolic representation)

• Mathematical (Quantitative) Models usemathematical relationships to representcomplexity

• Used in most DSS analyses

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Benefits of ModelsAn MSS employs models because

1. Time compression

2. Easy model manipulation

3. Low cost of construction

4. Low cost of execution (especially that of errors)

5. Can model risk and uncertainty

6. Can model large and extremely complex systems with possibly infinitesolutions

7. Enhance and reinforce learning, and enhance training.

Computer graphics advances: complement math models using moreiconic and analog models (visual simulation)

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Modeling--PreviewSeveral Solution Approaches• Trial-and-Error• Simulation

• Optimization– Find the best solution

• Heuristics– Rule based solution generation

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Mathematical Model• Identify Variables• Establish Equations describing their

Relationships• Simplifications through Assumptions• Balance Model Simplification and the

Accurate Representation of Reality

Modeling: An Art and Science

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DecisionVariables

MathematicalRelationships

ResultVariables

Uncontrollablevariables

Quantitative Models

Decision Variables• Describe alternative courses of action• The decision maker controls themResult Variables• Reflect the level of effectiveness of the system• Dependent variablesResults of Decisions are Determined by the• Decision• Uncontrollable Factors• Relationships among Variables

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TABLE -- Examples of the Components of Models.

AreaDecisionVariables

ResultVariables

UncontrollableVariables andParameters

Financialinvestment

Investmentalternatives andamountsHow long to investWhen to invest

Total profitRate of return (ROI)Earnings per shareLiquidity level

Inflation ratePrime rateCompetition

Marketing Advertising budgetWhere to advertise

Market shareCustomersatisfaction

Customers' incomeCompetitors' actions

Manufacturing What and howmuch to produceInventory levelsCompensationprograms

Total costQuality levelEmployeesatisfaction

Machine capacityTechnologyMaterials prices

Accounting Use of computersAudit schedule

Data processingcostError rate

ComputertechnologyTax ratesLegal requirements

Transportation Shipments schedule Total transport cost Delivery distanceRegulations

Services Staffing levels Customer satisfaction Demand for servicesSUSHANT SHARMA

Uncontrollable Variables orParameters

• Factors that affect the result variables• Not under the control of the decision maker• Generally part of the environment• Some constrain the decision maker and are called

constraints

Intermediate Result Variables• Reflect intermediate outcomes

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The Structure of QuantitativeModels

• Mathematical expressions (e.g., equationsor inequalities) connect the components

• Simple financial-type modelP = R – C

• Present-value modelP = F / (1+i)n

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Example: Linear ProgrammingModel

• ComponentsDecision variablesResult variableUncontrollable variables (constraints)

• SolutionX1 = 333.33X2 = 200Profit = $5,066,667

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• What-If Analysis– End user makes changes to variables, or relationships among variables, and

observes the resulting changes in the values of other variables• Sensitivity Analysis

– A special case of what-if analysis– The value of only one variable is changed repeatedly, and the resulting changes

on other variables are observed– Typically used when there is uncertainty about the assumptions made in

estimating the value of certain key variables• Goal-Seeking Analysis

– Instead of observing how changes in a variable affect other variables, goal-seeking sets a target value (a goal) for a variable, then repeatedly changes othervariables until the target value is achieved

• Optimization Analysis– A more complex extension of goal-seeking– The goal is to find the optimum value for one or more target variables, given

certain constraints

An interactive modeling processFour types of analytical modeling

What-if analysisSensitivity analysisGoal-seeking analysisOptimization analysis

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Descriptive Models

• Describe things as they are, or as theyare believed to be

• Extremely useful in DSS for evaluatingthe consequences of decisions andscenarios

• No guarantee that a solution is optimal• Often a solution will be "good enough”• Simulation: Well-known descriptive

modeling techniqueSUSHANT SHARMA

Satisfying (Good Enough)- find asolution which meets certain criteria

• Most human decision makers will settle for agood enough solution

• There is a tradeoff between the time andcost of searching for an optimum versus thevalue of obtaining one

• A good enough or satisfying solution may befound if a certain goal level is attained(Simon [1977])

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3. The Choice Phase

• Search, evaluation, and recommending an appropriate solution tothe model

• Specific set of values for the decision variables in a selectedalternative

The problem is considered solved after the recommendedsolution to the model is successfully implemented

Search Approaches• Analytical Techniques• Algorithms (Optimization)• Blind and Heuristic Search Techniques

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TABLE Examples of Heuristics

Sequence jobs through amachine

Do the jobs that requirethe least time first.

Purchase stocks If a price-to-earnings ratioexceeds 10, then do notbuy the stocks.

Travel Do not use the freewaybetween 8 and 9 a.m.

Capital investment inhigh-tech projects

Consider only thoseprojects whose estimatedpayback period is lessthan two years.

Purchase of a house Buy only in a goodneighborhood, but buyonly in the lower pricerange.

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Evaluation of Alternatives• Evaluation (coupled with the search process) leads to a

recommended solution

• Multiple Goals, often Conflicting goals

• Typical quantitative models have a single goal

• Multiple goals: Utility theory, Goal programming,Expression of goals as constraints, etc.

• Sensitivity Analysis Change inputs or parameters, look atmodel results

• Automatic, Trial and errorSUSHANT SHARMA

What-If Analysis• Figure Spreadsheet example of a what-if query for a

cash flow problem

Goal Seeking• Backward solution approach• Example: Figure 2.9• Example: What interest rate causes an the net

present value of an investment to break even?

• In a DSS the what-if and the goal-seeking optionsmust be easy to perform

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4. The Implementation Phase

There is nothing more difficult to carry out, nor moredoubtful of success, nor more dangerous to handle, thanto initiate a new order of things (Machiavelli [1500s])

*** The Introduction of a Change ***

Important Issues

• Resistance to change• Degree of top management support• Users’ roles and involvement in system development• Users’ training

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TABLE -- Cognitive-style Decision Approaches.

Problem-solving

Dimension Heuristic Analytic

Approach to learning Learns more by acting

than by analyzing the

situation and places

more emphasis on

feedback.

Employs a planned

sequential approach to

problem solving; learns

more by analyzing the

situation than by acting

and places less

emphasis on feedback.

Search Uses trial and error and

spontaneous action.

Uses formal rational

analysis.

Approach to analysis Uses common sense,

intuition, and feelings.

Develops explicit, often

quantitative, models of

the situation.

Scope of analysis Views the totality of the

situation as an organic

whole rather than as a

structure constructed

from specific parts.

Reduces the problem

situation to a set of

underlying causal

functions.

Basis for inferences Looks for highly visible

situational differences

that vary with time.

Locates similarities or

commonalities by

comparing objects.

(Source: G. B. Davis. Management Information Systems: Conceptual

Foundations, Structure, and Development.

New York: McGraw-Hill, 1974, p. 150. Reproduced with permission of McGraw-SUSHANT SHARMA

Differences in System Characteristics

Dimensions TPS MIS DSSType ofusers

Clerical andsupervisory

MiddleManagement

All levelsincluding topmgmt. andprofessionals.

Focus Datatransactions

Information Decision,flexibility

Applications Payroll, salesdata, inventory

Salesforecasting,Productioncontrol,

Strategicplanning,integratedproblems

Differences in System CharacteristicsDimensions TPS MIS DSS

Ease of use Low Moderate High

ProcessingInterest

Expediency Efficiency Effectiveness

Reason fordevelopment

Cost saving,customer service

Reporting basicinformation

Improved decisionmaking

SUSHANT SHARMA

Groups

• Most major decisions in medium and largeorganizations are made by groups

• Conflicting objectives are common• Variable size• People from different departments• People from different organizations• The group decision making process can be very

complicated• Consider Group Support Systems (GSS)• Organizational DSS can help in enterprise-wide

decision making situationsSUSHANT SHARMA

EXECUTIVE INFORMATION SYSTEMS - EIS

• Business Content• Strategic Planning• Uses External data (External Environment)• Unstructured Problems + Executive Experience• For example: Policy formation for Labor strike• Where decisions taken are not the results of series of steps

in some order

• Presentation content• Drill down reporting• Exceptional reporting• Graphical summary

SUSHANT SHARMA

The Artificial Intelligence Family

KNOWLEDGE BASED SYSTEMS

SUSHANT SHARMA

• Artificial Intelligence:

– Stores information in active form

– Creates mechanism not subjected to human feelings

– Eliminates routine and unsatisfying jobs

– Enhances organization’s knowledge base

– Generates solution to specific problems

Why Business is Interested in Artificial Intelligence

Effort to develop computer-based systems that behave as humans.

Capability that can be imparted to computers to enable them to displayintelligent human like behavior .

Potential to extend manager problem solving ability beyond his normalability

KNOWLEDGE BASED SYSTEMS

ARTIFICIAL INTELLIGENCE

SUSHANT SHARMA

• Knowledge Base

• Rule-based Expert System

• Rule Base

• Knowledge Frames

Capturing Knowledge: Expert Systems


SUSHANT SHARMA

1. Knowledge engineer• Specialist eliciting information and expertise from other

professionals• Translates information into set of rules, or frames, for an expert

system

2. Interacts with human3. Considers multiple hypothesis simultaneously

Building an Expert System


SUSHANT SHARMA

MODELSOF

FILE ORGANIZATION

SUSHANT SHARMA

1. Pile FileSet of records in no particular order.Records do not follow any particular sequence of attribute values.Adopted

When it is not possible to arrange the records in any logical orderFields of the record are not well defined.Exact usage of the file cannot be anticipated.

Files created punching the documents in the order they arrive. Thepile file so created may be then organised into another mode.Location of a record in a pile file can be done by sequentially

searching the records till the desired value of the key attribute isreached.Addition of new records is very simple. New records are added at the

end of the file.Changes and deletions of records in a pile file stored on random

access media can be done by locating the record and changing itscontents or flagging the record to indicate that the record has beeninvalidated.The file may be reorganised periodically to remove the holes created

by the deletion of records. However, updating of the file on sequentialaccess media can be done only by creating a new file.SUSHANT SHARMA

2. Sequential File

Files on sequential access media are generally organised in the sequential mode.However, sequential files may also be maintained on the random access media.The records are arranged in the ascending or descending order of the values of a

key attribute in the record.Sequence of records in the file can be changed from one key attribute to another

key attribute by sorting the file.Key for sequencing the records may also consist of a group of attributes.Updating and processing of records of a sequential file stored on a sequential

access media is carried out in a batch mode.Transactions leading to changes in the file data are collected in a batch

periodically. For example, transfers, promotions, retirements which lead to changesin the personnel file data can be collected on monthly basis.These transactions collected in a batch are then recorded in the form of a

transaction file. The transaction file is arranged in the same sequence as the masterfile to be updated. The updating involves the reading of records from bothtransaction and the master file and the matching the two for their key attribute. Theadditions, deletions and changes are then carried out in the records of the masterfile and the updated records are then written on the new updated master file.

SUSHANT SHARMA

Sequential File

The location of record in the sequential file stored on random accessmedial can be done by one of the following methods:

Sequential searchBinary searchProbingSkip search

In sequential search, each record is read one after another starting fromthe first record in the file till the desired key attributed value is reached.

Binary search can reduce the search time considerably as compared tothe sequential search.In binary search, the first record to be read is the one in the middle of the

file. Say, in a file containing 200 records, the 100th record will be read first.The value of the key attribute of this record will either be less or more than

the attribute value of the desired record. By this way, we can decidewhether the desired record lies in the first half of the file. The next recordread is the one which lies in the middle of the area localized from theprevious read operation. For example, if the record lies in the first 100records, the next record is the 50th record to decide whether the desiredrecord lies amongst the first fifty or the next fifty.SUSHANT SHARMA

Sequential File

The process is repeated many times till the desired record has beenlocalized into a very small area consisting of, say 5 or 10 records.

This area of 5 or 10 records is then searched sequentially to locate thedesired record.

Probing is done where the approximate range in which the desired recordmay lie can be ascertained from the value of the key attribute. Say, if thekey attribute is the name of the teacher and it is known that a name startingwith K like KRISHNA LAL lies between 38 percent and 46 percent of therecords, only this area may be searched sequentially to locate the desiredrecord.

In skip search, records are accessed in a periodic order. Say, every 20th

record is read till the value of the key attribute exceeds the desired value.By this method, an area of 20 records is localized for the search of thedesired record by sequential search.

SUSHANT SHARMA

3. Indexed Sequential File

Search in a long sequential file can be very time-consuming leading tounnecessary delays in the location of the record and avoidable computertime being spent in the search routine.The search can be made faster if an index to the file is provided. Such a

file organisation is called Indexed Sequential File.The index of the file contains a pointer record for one group of records in a

main file. The index file can be searched by the sequential search or binarysearch method. For very long file, index file itself can be long. In such acase, an index of the index file may be necessary, called the higher levelindex to search the record in the lower level index file. A number of levels ofindex file can be kept so that the highest level of index is small enough tostore in the main memory or the computer.Files can be indexed on the key attribute in which they are sequenced.

They may also be indexed on other attributes on which they are notsequenced. In that case, one pointer record will be required in the index foreach record of the main file. Such a file becomes an indexed non-sequential file. Indexed non-sequential file makes it possible to locate therecord by more than one key attributes of the record.

SUSHANT SHARMA

Indexed Sequential File

The file may be organised in the indexed sequential mode for the attributemost commonly used to locate the record and in the indexed non-sequential mode for other attributes.Addition of records in the sequential file are made in the overflow areas

provided in each group. For this purpose, some sectors in the area formingthe group can be kept blank, while organising the file, as a overflow are.

Additional overflow areas may be kept at the end of the file. The addedrecord is chained to the records immediately preceding and immediatelyfollowing the added record in the sequence by providing a pointer to theadded record in the record proceeding it and to the succeeding record inthe added record. Such chaining retains the facility of sequential searchwithin the group.

The indexed sequential files will hove to be reorganised periodically whenthe overflow areas become full or too many holes have been created due tothe deletion of obsolete records or the sequential search through thechained records has become too time-consuming.The reorganisation can be done by reading the old file, regrouping the

updated records, and writing a new file with new indices.SUSHANT SHARMA

4. Indexed File (Inverted File)

In the inverted file organisation, one index is maintained for each keyattribute of the record. The index file contains the value of the key attributefollowed by the addresses of all the records in the main file with the samevalue of the key attribute.

Ref.No

Name Date ofBirth

Districtof

Posting

EducationalQualification

SubjectTaught

1 Badri Nath 04.01.43 Bikaner Graduate Hindi2 Ram Lal 03.05.46 Ajmer Post Graduate Physics3 Neena Mathur 15.05.51 Jaipur Post Graduate History4 Anjana Roy 14.04.49 Udaipur Graduate Physics5 Pushpa Batra 07.09.45 Bikaner Ph. D History6 Kripa Ram 08.08.49 Jaipur Graduate Economics

SUSHANT SHARMA

Indexed File (Inverted File)

In the example of personnel information for school teachers, say the mainfile contains the records of six teachers, as follows:

The index file for key attribute, Educational Qualification would contain

GRADUATE 1,4,6POST GARDUATE 2,3Ph. D 5

And that for key attribute, Subject taught would contain

ECONOMICHINDIHISTORY

The main file need not contain the values of those attributes for whichindices have been maintained since these are already contained in theindex files. The main file may also be in any sequence. It can just be a pilefile. SUSHANT SHARMA

Indexed File (Inverted File)

The inverted file organisation requires three kinds of files to be maintained,the main file, the directory files and the index files.

The directory file contains the value of the key attributes and thepointer to the first record in the index file of the addresses of all therecords in the main file with that value of the key attribute arecontained. There is a separate directory file for each key attribute.

Inverted file is very useful where the list of records with specified value ofkey attribute is required. For example, we want to have a list of all theteachers posted in Bikaner district or all those teaching physics.Addition of records in the main file can be made at the end of the file since

it is not maintained in any sequence. However, corresponding entries haveto be made in all the index files for the key attributes of the record.

Changes in the key attributes of the record and deletions will also have tobe accompanied by corresponding changes in the index file. Themaintenance of index files, therefore, can be very time consuming.

SUSHANT SHARMA

6. Direct File

Direct files are maintained in any particular sequence. Instead, the valueof the key attribute is converted in to sector address by a predeterminedrelationship. The predetermined relationship converts the value of the keyattribute into the sector address for the storage and retrieval of the record.The method is generally used where the range of the key attribute value is

large compared to the number of records.

The method of converting the value of the key attribute into the address isknown as ‘randomising’ or ‘hashing’. Many different methods of hashing arein use.The most common method of hashing is the division method. In this

method, the value of the key attribute is converted into an integer if itsalready not an integer. It is than divided by another integer, often a primenumber, just smaller than the file size. The remainder of the division is usedas the address. The other methods used for hashing are the ‘mid-square’and ‘folding’ method.For example, if the personal record of NEENA MATHUR is to be stored the

name NEENA may be converted into an integer by stripping of the zone bitsto get 55551. SUSHANT SHARMA

Direct File

If the teacher code number is used as the key attribute, it may already be aninteger. For a file size of 1000, the prime number used is 997. the integer 5551is then divided by 997 to get the remainder as 816. the record is then stored insector with address 816.It is quite possible that two different values of key attributes may get converted

to the same address on hashing, when a ‘collision’ is said to have occurred.The collision is handled by storing the record immediately following theprevious record stored with the same hashed address.Collisions can also be handled by providing blocks or ‘buckets’ or records to

store all the records with the same hashed address. When the bucket is full,additional records with the same hashed address can be stored in the overflowareas provided at the end of the file. The overflow records are chained to thelast record in the bucket.The storage of records in a direct file are randomly scattered in a file. It is not

possible to utilize full storage on the file.

The ratio of the number of records stored to the total capacity of the file iscalled the ‘loading factor’. High loading factor leads to too many collisionsthereby increasing the search time for the records. On the other hand, a verylow loading factor leads to under-utilization of the file area.SUSHANT SHARMA

7. Multiring File

Where lists of records with specified key attribute value are desiredfrequently, multiring files are useful.

For example, we may like to have the list of teachers teaching physics or thelist of teachers retiring in a particular year. In this file organisation, all therecords with a specified key attribute value are chained together.

The directory file, like the one in the inverted file organisation, contains thepointer to the first record with specified key attribute value. The first recordcontains the address of the second record in the chain and the secondcontains the address of the third record. When the last record in the chaincontains pointer to the first record, the records are said to form a ring. Anumber of such rings for different key attribute values and for differentattributes can be formed. The directory provides entry point to the rings.

SUSHANT SHARMA

Structure of Data-BaseModels of Data Structure

1. Hierarchical model2. Network Model3. Relational Model

Hierarchical Model:

•Relationship between entities is stored in the form of a tree which has a root. The root may have anumber of branches and each branch may have a number of sub-branches and this may continue for anynumber of levels.

• The record at the lower level is called the ‘child’ of the next higher level and the higher level record iscalled the ‘Parent’ of its child records. For example a project may consist of sub-projects of work centresand each work centre may have a number of employees in it.

•Network Model:•The relationships are stored in the form of sets; each set having one owner and a number of members.For example, to indicate the employee working in a work-centre, the work-centre will be the owner of theset and each employee a member of that set.

• A entity may be a member of more sets and the owner of a set may be member in another set and vice-versa.

Relational Model: In this approach, both the entityrecords and relationship

Project no. Name Location Budget

E1 X X X

E2 X X X

E3 X X XSUSHANT SHARMA

Employee

Employee no. Name Designation Pay

E1 X X X

E2 X X X

E3 X X X

E4 X X X

E5 X X X

E6 X X X

E7 X X X

E8 X X X

E9 X X X

Project - Employee

Project no. Employee no. % Time

P1 E1 20

P1 E3 28

P1 E7 35

P2 E1 25

P2 E4 40

P2 E9 32

P3 E3 15

P3 E7 30

P3 E9 20

Records are stored in the form of tablescalled relation. For example, if we want tostore the project records, the employeerecords and the relationship between theproject and the employee indicating thepercentage of the employee time devoted tothat project, it may be stored in the form ofthree tables.

Relational approach is more amenable tomathematical theory by considering eachtable as a mathematical relation, each row ofthe table considered as a ‘tuple’ and eachcolumn in the row as the attribute drawn froma population ‘domain’. For the reason therelational approach is superior to otherapproaches.

SUSHANT SHARMA

Advantages of Data-Base Systems

i. Redundancy controlled: In traditional file systems, each application has its own private files. Many of the data items in a file may be common toother files i.e., the same data items in a file may be stored in a number of files. Apart from wastage of storage space, multiple updation are requiredfor a single transaction in the real system. This is avoided by maintaining only one copy of the data in the data-base system and interlinking themby logical relationships. Even if, multiple copies have to be maintained due to technical reasons, this fact is known to the data-base system and thecopies are updated automatically with the single user entry.

ii. Inconsistency Avoided: updation of separate application files for the same real transaction leads to inconsistency of data because differentapplication file are updated at different points according to schedule. Two separate files may, thus, indicate different status of the same data at agiven point of time. For example, the record file may show that employee ‘A’ is posted in department ‘X’ while at the same time the departmentrecord file may indicate that he is posted in department ‘Y’. Control of redundancy automatically solves the problem of inconsistency, in the data-base system.

iii. Integrity of Data: Inconsistency between two entries representing the same facts is an example of lack of integrity of data. Even if the redundancy iscontrolled, there may still be in accuracies in data. For example an employee may be shown posted in two separate departments in the departmentwise file or an employee may be shown to have worked for 200 hours in a week. The central control of data provided in the data-base system helpsto control such inaccuracies in data and maintain its integrity.

iv. Integrated View of Data: Integration of related files in the data-base system provides an integrated view of data. The data needs of a topmanagement query, like the proportion of a department budget for pay and allowances spent on a specific project, may cut across variousapplications. Such queries are extremely difficult to answer in a traditional file system.

v. Unstructured information Needs: Information needs of unstructured management decisions are not known in advance and cannot be pre-programmed. Since the related data are centralized and the relationship structure among entities is built into the data-base, it is more suited tohandle unstructured queries.

vi. Enforcement of Standards: With central control of the data-base, the Data-Base Administrator can ensure that desired standards are followed inthe representation of data. Standardizing of data formats is particularly important for interchange or migration of data between systems.

vii. Security Restrictions: The Data-base Administrator, having complete jurisdiction over the operational data, can ensure that access to the data-bases is available only to the authorized users. He can define different authorization checks for each type of access viz., retrieve, modify, deleteetc., to each piece of information in the data-base.

viii. Data independence: It is a crucial advantage of the data-base system over the traditional file system. Most traditional file systems are highly data-dependent. This means that the way the data are organized and the way it will be accessed is dictated by the needs of the specific application. Theknowledge of the storage organisation and the access strategy is built into the application software. For example, if the data are organized in theindexed sequential manner, this fact has to be known to the application software and the procedures for retrieval and updating of data are built inthe application software keeping this fact in view. A change in the storage structure or access strategy of data will drastically affect the applicationsoftware. It was found in some of the traditional systems that organizations were spending as much as 6% of their programmers time on themodifications of the existing application software and only 40% on the development of new software.

SUSHANT SHARMA

• TRANSFORMATION OF BUSINESS– GLOBALIZATION – Global Market Environment– KNOWLEDGE-BASED ECONOMIES –More jobs

in sales ,education& services than factories– PRODUCTIVITY– NEW PRODUCTS & SERVICES– KNOWLEDGE AS AN ASSET– TIME-BASED COMPETITION– SHORTER PRODUCT LIFE– TURBULENT ENVIRONMENT– LIMITED EMPLOYEE

SUSHANT SHARMA

• TRANSFORMATION OF ENTERPRISE– FLATTENING- Squeezing Functional

Hierarchy– DECENTRALIZATION- Distributed Work Load– FLEXIBILITY- Offers openness of working

hours& decision making for employee’sconvenience

– LOCATION INDEPENDENCE – GivesPossibilities of Mobile and virtual offices

– LOW TRANSACTION COSTS– EMPOWERMENT– COLLABORATIVE WORK –People work in

coordination

SUSHANT SHARMA

Technology Features Description

Processing capabilityIncrease in computing power and reduction in pricesof hardware has given rise to the availability ofmachines to masses.

Portable Computing

Computers are available in handy sizes, which canbe ported, plugged and played at any place. Thisadds to the services of mobile business persons,e.g., directors, managers, sales persons.

Global NetworkingInformation network infrastructure has advanced tothe extent that today you can access any computerfrom any where in the world.

Enterprise NetworkingEasy work flow automation can be done to reducepaper work and speed up the processing ofdocuments in the offices.

Distributed ComputingThis feature facilitates the requirements forempowerment and decentralization of work toemployees.

Graphical User Interface

Easy to learn graphical interfaces have saved theusers from the unpleasant task of memorizingcommands. Now, end users can operate thesoftware with great ease. New, fascinating form ofdata presentations have given a boost to the usageof the systems.

INCREASED CAPABILITY OF IT

SUSHANT SHARMA

• MIS is an integrated collection of functionalinformation systems, each supportingparticular functional areas.

SUSHANT SHARMA

Etc.

An Organization’sMIS

FinancialMIS

MarketingMIS

HumanResources

MIS

AccountingMIS

Drill down reports

Exception reports

Demand reports

Key-indicator reports

Scheduled reports

Databasesof

externaldata

Databasesof

validtransactions

Transactionprocessing

systems



Extranet

Internet

Figure 9.3

Etc.

SUSHANT SHARMA

Financial MIS

• Finance information system help organizebudgets, manage cash flow, analyzeinvestments, and make decisions thatcould reduce interest payments andincrease revenues from financialtransactions

• Provides financial information to allfinancial managers within an organization.

SUSHANT SHARMA

Financial statements

Uses and managementof funds

Financial statisticsfor control

Operationaldatabases

Databasesof valid

transactionsfor each

TPS


systems



Internet orExtranet

Figure 9.3

FinancialMIS


Databases ofexternal data

Databases ofinternal data

FinancialDSS

FinancialES

Financialapplicationsdatabases

Customers,Suppliers

SUSHANT SHARMA

Inputs to the FinancialInformation System

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

financial needs.• Transaction processing system (TPS)

– Important financial information collected from almostevery TPS - payroll, inventory control, orderprocessing, accounts payable, accounts receivable,general ledger.

– External sources– Annual reports and financial statements of

competitors and general news items.SUSHANT SHARMA

Financial MIS Subsystemsand Outputs

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

SUSHANT SHARMA

SUSHANT SHARMA

Financial Information Systems

• Payroll – link to human resources system• Accounts payable – link to purchasing and

inventory• Patient accounting, billing, accounts

receivable• Cost accounting, including allocating

overhead• General ledger

SUSHANT SHARMA

Financial Information Systems(continued)

• Budgeting• Internal auditing• Forecasting• Planning financial investments

– Cash flow vs. cash need• Financial statements• Financial reporting for top management

SUSHANT SHARMA

Finance• The job of financial managers is to manage

money as efficiently as possible by:– Collecting payables as soon as possible– Making payments by the latest time allowed by

contract or law– Ensuring that sufficient funds are available for

day-to-day operations– Taking advantage of opportunities to accrue the

highest yield on funds not used for currentactivities

SUSHANT SHARMA

Finance• Cash Management

– Financial ISs help balance the need to accrueinterest against the need to have cashavailable.

– Cash management systems (CMS): Handlecash transactions specifically.

– Electronic fund transfer (EFT): The electronictransfer of cash from one bank account toanother.

SUSHANT SHARMA

Finance

• Investment Analysis and Service– Analyze and project the prices of a

specific stock or bond.– Transmit buy and sell orders

electronically.– Provide clients with a detailed statement.– Monitor account information and news

online.

SUSHANT SHARMA

Marketing MIS• Marketing information system help analyze demand for

various products in different region and populationgroups in order to more accurately market the rightproduct to right producer.

• Marketing ISs provide information that helpsmanagement decides how many sales representatives toassign to specific products in specific geographical area

• Supports managerial activities in product development,distribution, pricing decisions, and promotionaleffectiveness

SchematicSUSHANT SHARMA

Sales by customer

Sales by salesperson

Sales by productOperationaldatabases

Databasesof valid

transactionsfor each

TPS


systemsBusiness

transactions

Figure 9.9

MarketingMIS

Databases ofexternal data

Databases ofinternal data

ManufacturingDSS

ManufacturingES

Marketingapplicationsdatabases

Pricing report

Total service calls

Customer satisfaction

SUSHANT SHARMA

Inputs to Marketing MIS

• Strategic plan and corporate policies• The TPS• External sources:

– The competition– The market

SUSHANT SHARMA

Marketing MIS Subsystems andOutputs

• Marketing research• Product development• Promotion and advertising• Product pricing

SUSHANT SHARMA

What is marketing informationsystem ?

Marketing information consists of people,equipment and procedures to gather, sort,analyze, evaluate and distribute needed,timely and accurate information to marketingdecision makers.

Marketing decision makers use the data toidentify and solve marketing related problems.

SUSHANT SHARMA

Marketing Information system suppliesthree types of information.

• Recurrent Information• Monitoring Information• Requested Information

SUSHANT SHARMA

• Recurrent InformationThis is the data that an MIS supplies

periodically about the market share of aspecific product and customer’s awarenessof company’s brands. The data may besupplied on weekly, monthly or yearlybasis.

SUSHANT SHARMA

• Monitoring InformationThis is the data obtained from the regularscanning of certain sources. Marketingmanagers may need data related tocompetition or the industry. It is essential sothat marketing managers can be alert andidentify potential problems

SUSHANT SHARMA

• Requested InformationThis information is developed in responseto some specific request by the marketingmanager. Secondary data or primary datathrough survey research are collected inresponse to the specific request. The MISsupplies the requested information fordecision making.

SUSHANT SHARMA

Marketing Information system

External data

Internal data

Requestedinformation

MarketingResearchdivision

MarketingInformation

system

MarketingManagersDivision

SUSHANT SHARMA

Sources of Marketing Information .

The MIS information inputs come from differentsources, viz., both within and outside firms .Some of the commonly used internal sources ofinformation are:Sales Analysis- The marketing informationsystem retrieves sales information and put themin usable and disaggregated form. It detectsvarious marketing strengths and weaknesses.Computer assisted sales analysis uncoverssignificant details for management needs.

SUSHANT SHARMA

Cost Analysis-The cost analysis is possiblewith the effective accounting system. Theclassification and analysis of the cost ofproduction, cost of distribution and sellingmay provide adequate information for themanagement purposes .Financial Records- The financial records &publications may provide adequateopportunities for management of sales &marketing activities .Many companiesprepare periodical final statement toobserve the balance of each item offinancial records.

SUSHANT SHARMA

WhyInformation

IsNeeded

MarketingEnvironment

StrategicPlanning

CustomerNeeds

Competition

SUSHANT SHARMA

Importance of marketing information system• Anticipation Of Customer Demand-Every

marketer needs up-to-date knowledge aboutconsumer needs and wants.

• Systematic Approach-Expanding marketsand competitive marketing environmentrequire adequate market intelligence system.

• Economic indicator-Marketers must havelatest information on the changing trends ofsupply, demand and prices

SUSHANT SHARMA

• Significance of Analysing Competition-Marketercannot survive without having information regardingnature , character and size of competition to be met.

• Development of Technology-Marketers must havelatest information regarding technological development.

• Understanding the Consumer-Information system canestablish proper two way flow of information andunderstanding between marketers and consumer.

• Marketing Planning-Marketing plans and programmesare based upon information supplied by economicforecasts and market research.

SUSHANT SHARMA

SYSTEM DEVELOPMENT LIFECYCLE METHODOLOGY

SUSHANT SHARMA

SYSTEM PLANNING –1Mechanized Vs Non –Mechanized IS

2Centralization Vs Decentralization of computing facilities3Batch mode Vs real Time mode of Info. Processing4Independent Vs Modular method of designing IS1, PERFORM COST -BENEFIT ANALYSIS

BENEFITS – Reduction in staff , Improved Processing speed per unit of workload, ready access to info, reduction inexpenditure to store ,analyze and organize massive business dataDISADV:- Equipment Cost, Enhancement in the cost –More skilled and higher paid staff, technical involvement of professionalprogrammers, expenses encountered for formatting and reproduction of data

DEVELOPMENT STAGE –SOFTWARE BASED1Decide coding language based on nature of application area, quantum of data to be handled, and amount of calculation,basic software language availability to handle any language (BASIC, COBOL, FORTRAN, PASCAL, C, ORACLE, andJAVA etc.

2Decide on capacity of computer ( 8 Bit/ 16 Bit)

3Utility –Part of basic software –transfer of data from card reader to tape drives , from disk drive to the printer etc. Larger thecomputer, more the utilities reducing writing of programs to some extent due to sorting and merging facility.

4Multiprogramming facility with lesser files on the disk for limited memory –space and tape disk facilities.

System Feasibility –Test /Evaluation of complete System Plan1Based Checking ability to meet user needs/ Use of resources to generate benefits, Impact on user organization, Workability ofthe system ---- Check scope and complexity of computerization

System Design – Information base according to Sources, characteristics, Purpose-1Sources can be single/dual . Eg. Accounts deptt. (single source) .Inventory IS –(dual) Stores and Purchase depts.

2Purpose- User how it will be used and when it will be used

3Characteristics of Info- Size, variability , volatility &activity

SUSHANT SHARMA

DEVELOPMENT STAGE –PROCESS BASED1Understanding Physical flow of data and current usage

2Decide outputs attributes- Format /frequency/presentation/ items of output info, level of aggregation3Decide input requirement – source, agency for collection , format, frequency of collection , items of data ,4Developing Logical questions with Yes /No results leading to further progress and back tracking5Develop codification sheet for writing programs6Removal of errors from the program(debugging) and their integration into system design7Testing with sample data8Ensuring computerized system to deliver results before discontinuing the manual system9Development of Manuals1Comprehensive training and instructions to the user.

IMPLEMENTATION STAGE

1Obtaining Input - Output from the computer- 2 -way Process . test run and parallel run –2Documentation – System Manual , operation manual and user manual

System Manual – indicated complex design of IS showing different elements of computerization linked through flowchart, types of output, andformats of input.rief outline of ISOperational Manual – Technical instructions for the actual computer operations – different job stepsUser Manual – brief outline of IS, its major benefits, Inputs needed and outputs expected.

3User Training –4Modification to the installed system – Continuous Process for the professional so that IS is updated and meaning for the user for changes in the environment

Process Evaluation1Design of the system and quality of programming –determine Time taken by processing

2Utilization of hardware resources- different memory partitions &allocating input output devices to each partition3Lack of debugging leads to time run and again- Best check- Lay down permissible no of development runs before sending it of production runs

Product Evaluation1Ensure acceptable quality of output report and continue to be use in

System Audit1Identifying Locations of control points for system errors and reasons for selection of these points – on the basis of frequency oferror ,magnitude of error ,cost of error detection

2Develop Audit trait –a series of well defined provisions which permit a person to follow and verify the system process.3Establish steps for System recovery issue , system processing alternatives ,system security , systems restart

SUSHANT SHARMA

SUSHANT [email protected]: 9910039373

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