Management Information System

Session 1

What is in store in MIS Course?

• Information Technology• Enterprise Systems• E-Business• Business Process• Decision Making

THEMES

Information Technology

• Hardware and Software• Enabling the enterprise systems and e-

business applications of the organization• Necessary for security, privacy and internal

control• Business professional need to be aware of the

latest available technology to evaluate them.

Enterprise Systems

• Sharing of data across the organization• Functional Modules – Accounting– Manufacturing– Human Resources– Logistics

• Integrated software packages

E-Business

• Application of Electronic Networks to undertake business processes.

• Has created entirely new ways of working within and across organizations

• Buying and selling of goods at virtual market places

Business Process

Any process that makes the business work.

A business process is an activity or set of activities that will accomplish a specific organizational goal.

A business process is a collection of related, structured activities or tasks that produce a specific service or product (serve a particular goal) for a particular customer or customers. It often can be visualized with a flowchart.

What is in store today?• Concept of Data, Information• What is Information Systems? Purpose of Information

Systems • Decision Making - The Business Environment• Foundations of Information Systems in Business• Creating Information, Sources of Information• Organizations and IS • Role of IS in Business & Management • Managerial challenges of IT • Digital Enterprises, Web-Powered Enterprises • Information Systems in global business today

What is Information System?

Let’s watch a video

The Purpose of Information Systems

• Businesses use information systems– To make sound decisions– To solve problems

• Problem is any undesirable situation• Decision arises when more than one solution

to problem exists

The Purpose of Information Systems (continued)

• Problem solving and decision making require information

• Keys to success in business are– Gathering correct information– Storing information– Using information

Generating Information

• A process is manipulation of data• Process usually produces information• Process may produce more data• A piece of information in one context may be

considered data in another context

Concept of Data

Data are raw facts or observations that are considered to have little or no value until they have been processed and transformed into information.

Examples??- Today’s Date- Marks in a quiz- Records of a business transactions

Information is Critical

• The information we have is not what we want

• The information we want is not the information we need

• The information we need is not available.

Information is a Resource

• It is scarce• It has a cost• It has alternative uses• There is an opportunity cost factor involved if

one does not process information

15

Data, Information and Systems• Generating Information– Computer-based ISs take data as raw material, process it,

and produce information as output.

Input-process-output

Why need Information?

To ensure effective and efficient decision –

making leading to prosperity of the Organization.

Data vs. Information• A house number• A bank statement• The number 3.142• A National Insurance number• A balance sheet• A bus timetable• A car registration plate• A student grade sheet• A temperature reading in the day’s weather

Data vs. Information• A house number - Data• A bank statement – Information• The number 3.142 – Data• A National Insurance number – Data• A balance sheet – Information• A bus timetable – Information• A car registration plate – Data• A student grade sheet – Information• A temperature reading in the day’s weather - Data

Information Creation• Classifying– Categorizing Data

• Rearranging / sorting– Group data in a particular order

• Aggregating– Summarizing data. Average, subtotals, total

• Performing Calculations– Employee pay slip

• Selection– Choosing or discarding data on the basis of a

condition / criteria.

Decision Making• A step in problem solving• Intelligence gathering– Definition of problem– Data gathered on scope– Constraints identified

• Design phase– Alternatives identified and assessed

• Choice– Selection of an alternative

Scorecard / Dashboard

IS, IT in a Firm and Business Environment

IT

Business Environment

Company

IS

What is MIS?

Short for Management Information System – MIS refers broadly to a computer-based

system that provides managers with the tools for organizing, evaluating and efficiently running their departments.

Currently also defined as Management Information (MI) & System (S)

MIS Definition

System that provides information support for decision-making in the organization

Integrated system of people, processes, hardware and software (now Internet) to provide information to support operations, the management and the decision-making function in the organization.

Role of MIS in an Organization

• Appropriate data collected from various sources, processed and sent further to the needful destinations – Support business processes and operations

• Helps in Strategic Planning, Management Control, Operational Control, Transaction Processing– Support strategies for competitive advantage

• Information generation, communication, problem identification, and aid decision making– Support decision making by employees and managers

IS - First Order Effect

• Outcomes that arises as a direct consequences of the implementation of an IS known as the first order effect

• Can be negative or positive

IS - Second Order Effect

• Increased use of IS may lead to further changes over a period of time.

• It may improved decision making, processes are easier to manage, customers have lesser complaints.

• These may not be visible / measurable immediately.

IS – Third Order Effect

• Large scale consequences of implementation of IS.

• Competitive pressure may force firms to adapt a particular type of IS.

Examples for IS?(sans computers)

• Card catalog in a library• Your books, bag, day planner, notebooks• An physical / manual accounting ledger

Business Environment• That influences the way in which the

organization operates.• Dynamic• External and internal• Other factors of IS– Purpose – Inputs – Outputs– Boundary

External Business Environment

• The Internet Economy• Global Market place• Business Ecosystems• De-capitalization• Faster Business Cycles• Accountability and Transparency• Rising Societal risks of IT

Internal Organization Environment

• From Supply-Push to Demand-Pull• Self-service• Real-Time Working• Team-Based Working• Anytime, Anyplace information• Outsourcing and strategic alliances• Demise of Hierarchy

Business Drivers To IS Foundations

• The Internet Economy• Global Market place

New products, services, and business models: Information systems and technologies create opportunities for products, services, and new ways to engage in business.

Customer and supplier intimacy: Improved communication with and service to customers raises revenues, and improved communication with suppliers lowers costs

Business Ecosystems

Operational excellence: Efficiency, productivity, and improved changes in business practices and management behavior

• Real-Time Working• Team-Based Working• Anytime, Anyplace information• Demise of Hierarchy

Competitive advantage: Implementing effective andefficient information systems can allow a company to charge less for superior products, adding up to higher sales and profits than their competitors. Also for survival.

• Outsourcing and strategic alliances• Faster Business Cycles

Foundations of IS in Business

• Amazon• Dell• IRCTC• e-Bay• HUL• HDFC, ICICI, SBI, Citibank et al

Goals of new work environment

• Leverage knowledge globally

• Organize for complexity

• Work electronically

• Handle continuous and Discontinuous Change

Case - Tata Motors• What does Tata Motors use its IS for?• Relate the Business ecosystems driver discussed in class

with the case.• What is the system used to manage the suppliers and

vendors?• List the advantages of such a system.• Quickly draw a workflow – how the system works• How does the IS help in managing the marketing channel?• Discuss the first, second and third order effect of the Tata

Motors IS.• What are the challenges faced by the IS manager(s) of

Tata Motors?

Managerial Challenges

• What Information Systems to build?• How much to spend on Information systems?• What level of capabilities should be created

with Information Systems?• How centralized should the services be?• What are the security levels are required?• What is the technology road map for

organization?