Mis unit i

 Data is individual elements of transaction
 Information is data with meaning for
decision making
 System is simply as a set of elements
joined together for a common objective
 Information System is set of procedures
organized to generate information
 MIS is designed to process information for
effective planning and tactical decision
making

Evolution:
 Before the concept of MIS was created,
computer programmers are just creating
applications for science and with calculations
 As computer usage evolved in fields of
business and data management, software
applications were need to process non-
scientific data
 Needed a field of study to bridge the gap
between computer programmers and business
world.

Mainframe processing of data:
 In 1939, Dr. John V. Atanasoff & his asst.
Clifford Berry, constructed first electronic
digital computer.
 This invention led to a career field
established as computer science.

ENIAC computer(1944):
 ENIAC played a role in development of
atomic bomb
 Developed for applying computers in other
areas of education, business and every
day life

Creation of Business Applications for
Industry:
 In 1952, the evolving punch card system
created by IBM would change the way Govt,
business & education would perceive the way
that data way to be processed.
 In late 1950’s and 1960’s computers would
start to integrate into other areas of society,
accounting, retail sales, transportation and
online services would benefit from the advent
and use of computers.

Creation of MIS field (1970):
 Still a language problem between
programmers and business people who
wanted certain applications developed for
their business.
 The idea was to create “Workforce who could
bridge the communication & technical gaps
between management & computer
programmers”.

MIS network:
 From 1980 to present, there has been an
explosion of technology in field of IS
 The concept of MIS has expanded to
include data mining, data retrieved
sciences, and technology used in every
day devices
 Computers have assisted centuries into
information age by merging concept
through various MIS applications

Business Information System
 Business information systems are sets of
inter-related procedures using IT
infrastructure in a business enterprise to
generate and disseminate desired
information.
 Such systems are designed to support
decision making by the people associated
with the enterprise in the process of
attainment of its objectives.

Key Components of Business
Information System:
Information systems can be described by
four of their key components which
are:
 1. Decisions
 2. Transactions and processing
 3. Information and its flow
 4. Individuals or functions involved.

Corporate
Headquarters
Finance Production
Marketing
and Sales
Corporate
Databases
Mainframe
Divisional
Databases
Local Area Network:
PCs with Local Databases
Salesforce
Notebooks
Regional
Office
Work-
stations Plant Minicomputers
Telecommunications
Link
Divisional
Minicomputers
with Divisional
Databases
Management Information System:
Three-Tier Architecture

 MIS and Accounting
 MIS and Management Theory
 MIS and Operations Research
 MIS and Computer Science
MIS and Other Academic
Disciplines

MIS and Accounting
 Managerial accounting is concerned with
determining relevant costs and performing other
useful analysis useful for managerial control and
managerial decisions.
 It tends to focus on the preparation of budgets and
performance analysis based on budgets.
 The MIS concept includes much of the contents of
managerial accounting.

MIS and OR
 OR is important in relation to the MIS
because it has developed procedures for
the analysis and computer based solutions
for many types of decision problems.
 The systematic approach to problem
solving, use of models, and computer
based solution algorithms are generally
incorporated in the decision support
system component of MIS.

MIS and Organizational Theory
 Since MIS is a support system for
organizational functions, it draws upon
concepts of organization, OB,
management and decision making

MIS and Computer Science
 Computer science is important to MIS
because it covers topic such as
algorithms, soft wares, data structures,
computations etc.

MIS Professionals
 The profiles of MIS professionals are varied, but in general,
such individuals possess many of the following traits:
 good problem solving skills
 ability to effectively manage time and resources
 a clear vision of “the big picture” as well as the “small
details”
 a desire to work closely with other people
 excellent communication skills
 ability to think strategically about technology
 a desire to take responsibility for developing and
implementing their own ideas

What are typical career options
for MIS professionals?
 IT Consultant
 Web Developer
 Information Systems
Manager
 Business Intelligence
Analyst
 Network Administrator
 Business Application
Developer
Systems Analyst
Technical Support
Specialist
Business Analyst
Systems Developer

Need for MIS
 Increasing impact of information processing for
organizational decision making.
 Dependency of services sector including banking,
financial organization, health care, entertainment,
tourism and travel, education and numerous others on
information.
 Changing employment scene world over, shifting base
from manual agricultural to machine-based
manufacturing and other industry related jobs.
 Information revolution and the overall development
scenario.
 Growth of IT industry and its strategic importance.

Need For MIS
 Strong growth of information services fuelled by
increasing competition and reduced product life
cycle.
 Need for sustainable development and quality
life.
 Improvement in communication and
transportation brought in by use of information
processing.
 Use of information processing in reduction of
energy consumption, reduction in pollution and a
better ecological balance in future.

Strategic Role of Information Systems
■Information systems are no longer restricted to
backroom support roles.
■Organizations are increasingly aware of the
potential strategic applications of information
systems.

Competitive Forces
■Michael Porter discussed 5 organization-level competitive
forces in an industry which together determine how strong
an organization is in its industry.
■These forces are:
◆Bargaining Power of Suppliers
◆Bargaining Power of Buyers
◆Threats of New Entrants
◆Threats of Substitution
◆Intensity of Rivalry

Bargaining Power of Suppliers
■The bargaining power of suppliers is high if there are
concentrated sources of supply and few substitutes.
■If these near monopoly situations, the suppliers can
push prices upward and can be indifferent about service
or quality.
■Information Technology can be used to reduce supplier
power by developing in-house capability to produce or
service or buying into a supplier.

Bargaining Power of Buyers
■When buyer is high (e.g. when the buyer is large and/or the
products are undifferentiated), then there is downward pressure on
prices and upward pressure on both product quality and service.
■Information Technology can be used to reduce buyer power such as
increasing switching costs.

Threats of New Entrants
■When an industry experiences good profit margins, it
is attractive for new entrants to join the industry and
this will create downward pressure on prices due to
the increased availability of products and service.
■An existing player in the market can create can entry
barrier by using IT to make the cost too high for any
new player.
■A new entrant can use IT to improve its services or
product and thereby, overcome barriers set up by
existing players.

Threats of Substitution
■Substitution of products and services can reduce or
eliminate the market for existing organizations and
thereby weaken it.
■A late entrant to the market may choose to introduce a
product that is a technological advancement over the
existing products in the market, and thereby weaken
existing players by the threat of substitution.

Intensity of Rivalry
■The intensity of rivalry in the market affects the overall
profitability, and it is usually greater in mature or declining
markets.
■Price wars usually benefit the consumer and eliminate some of
the weaker players in the market.
■IT can be used to overcome the dilemma of having to lower
prices while increasing levels of service.

Data vs. Information
There is a subtle difference between data and
information. Data are the facts or details from
which information is derived. Individual pieces of
data are rarely useful alone. For data to become
information, data needs to be put into context.

Data Information
Meaning Data is raw,
unorganized facts that
need to be processed.
Data can be something
simple and seemingly
random and useless
until it is organized.
When data is processed,
organized, structured or
presented in a given
context so as to make it
useful, it is called
information.
Example Each student's test
score is one piece of
data.
The average score of a
class or of the entire
school is information that
can be derived from the
given data.

Data are simply facts or figures — bits of
information, but not information itself. When data
are processed, interpreted, organized, structured or
presented so as to make them meaningful or useful,
they are called information. Information provides
context for data.

Examples of Data and Information
•The history of temperature readings all over the world for the
past 100 years is data. If this data is organized and analyzed to
find that global temperature is rising, then that is information.
•The number of visitors to a website by country is an example of
data. Finding out that traffic from the U.S. is increasing while
that from Australia is decreasing is meaningful information.
•Often data is required to back up a claim or conclusion
(information) derived or deduced from it. For example, before a
drug is approved by the FDA, the manufacturer must conduct
clinical trials and present a lot of data to demonstrate that the
drug is safe.

Five characteristics of high quality
information
•Accuracy
•Completeness
•Consistency
•Uniqueness
•Timeliness.

•Information needs to be of high quality to be useful and accurate. The
information that is input into a data base is presumed to be perfect as
well as accurate.
•The information that is accessed is deemed reliable. Flaws do arise
with database design but do not let something in your control, accurate
and reliable data, be one of them.
• A database design that is accurate and reliable will help achieve the
development of new business ideas as well as promoting the
organizational goals.
Accuracy

•Completeness is another attribute of high quality
information. Partial information may as well be incomplete
information because it is only a small part of the picture.
•Completeness is as necessary as accuracy when
inputting data into a database.
Completeness

•Consistency is key when entering information into a
database. For example, with a column for a phone number
entry 10 digits is the expected length of the field. Once the
fields have been set in the database, a number more or
less than 10 digits will not be accepted.
• The same applies for any field, whether it is an entry that
requires a number, a series of numbers, an address, or a
name, etc. If the fields are not set to a specific limit for
information then consistency is even more important.
Consistency

•Uniqueness is the fourth component of high quality
information. In order to add value to any organization,
information must be unique and distinctive. Information is a
very essential part of any organization and if used properly
can make a company competitive or can keep a company
competitive.
Uniqueness

• New and current data is more valuable to organizations
than old outdated information. Especially now, in this era of
high technological advances, out-of-date information can
keep a company from achieving their goals or from
surviving in a competitive arena.
•The information does not necessarily need to be out of
date to have effect, it just needs to not be the most
current. Real-time information is an element of
timeliness.
Timeliness

INFORMATION SYSTEM RESOURCES
• PEOPLE RESOURCES
•HARDWARE RESOURCES
•SOFTWARE RESOURCES
•DATA RESOURCES

(i) PEOPLE RESOURCES
People are required for the operation of all
information systems. These people resources include
end users and IS specialists.
· End users (also called users or clients)
are people who use an information system or the
information it produces. They can be accountants,
salespersons, engineers, clerks, customers, or
managers. Most of us are information system end
users.
· IS Specialists are people who develop
and operate information systems. They include
systems analysts, programmers, computer operators,
and other managerial technical, and clerical IS
personnel.

(I) HARDWARE RESOURCES
The concept of Hardware resources includes all physical devices
and materials used in information processing. Specially, it includes not
only machines, such as computers and other equipment, but also all
data media.
Example of hardware in computer-based information systems are:
Computer systems, which consist of central processing units
containing microprocessors, and variety of interconnected peripheral
devices. Examples are microcomputer systems, midrange computer
systems, and large mainframe computer systems.
Computer peripherals, which are devices such as a
keyboard or electronic mouse for input of data and commands, a video
screen or printer for output of information, and magnetic or optical disks for
storage of data resources.

(iii) SOFTWARE RESOURCES
The concept of Software
Resources includes all sets of information
processing instructions. This generic concept
of software includes not only the sets of
operating instructions called programs, which
direct and control computer hardware, but also
the sets of information processing instructions
needed by people, called procedures.

The following are the examples of software resources:
· System Software, such as an operating system
program, which con controls and supports the operations of a
computer system.
· Application Software, which are programs that
direct processing for a particular use of computers by end users.
Examples are a sales analysis program, a payroll program, and a
work processing program.
· Procedures, which are operating instructions for the
people who will use an information system. Examples are
instructions for filling out a paper form or using a software
package.

(iv) DATA RESOURCES
The data resources of information systems are
typically organized into:
· Database that hold processed and
organized data.
· Knowledge bases that hold
knowledge in variety of forms such as facts,
rules, and case examples about successful
business practices.

The type of information required by
decision makers in a company is directly
related to:
•the level of management decision making
•the amount of structure in the decision
situations managers face

The levels of management decision making that must be
supported by information technology in a successful
organization
Strategic management: As part of a strategic
planning process top executives
•develop overall organizational goals, strategies,
policies, and
•monitor the strategic performance of the
organization and its overall direction in the political,
economic, and competitive business environment

Tactical management: Business unit managers and
business professionals in self-directed teams
i.develop short- and medium-range plans, schedules,
budgets and specify policies, procedures, and business
objectives for their sub-units of the company, and
ii.allocate resources and monitor the performance of their
organizational sub-units, including departments, divisions,
process teams, project teams, and other workgroups.

Operational management: Operating managers and
members of self-directed teams
i.develop short-range plans (e.g. weekly production
schedules), and
ii.direct the use of resources and the performance of
tasks according to procedures and within budgets and
schedules they establish for the teams and other
workgroups of the organization.

Stages
of Decision-
making
Role of Information in decision making
Identification
and structuring
of
problem/opport
unity
One needs information to identify a problem and put it in a
structured manner. Without information about a problem or
opportunity, the decision-making process does not even
start.
Putting the
problem/
opportunity in
context
Without information about the context in which the problem
has occurred, one cannot take any decision on it. In a way,
the .information about the context defines the problem.
Generation of
alternatives
Information is a key ingredient in the generation of
alternatives for decision-making. One has to have
information about possible solutions to generate
alternatives.
Choice of best
alternative
Based on the information about the suitability of the
alternatives, a choice is made to select the best alternative.

Information systems can be regarded as a strategic
resource in an organization. The opportunities can
be classified in 4 areas:
To gain competitive advantage.
To improve productivity and performance.
To enable new ways of managing and
organizing.
To develop new businesses.
Role of Information in strategic decision
making

•The MIS is as good as its design-MIS if designed in an
improper manner does not serve the management and
hence is of little relevance.
•The MIS is as good as its users-if the users do not know
how to leverage the information available from MIS then
MIS is of little use.
•The MIS is no good if the basic data is obsolete and
outdated (for example, MIS will only facilitate garbage
with information and in about garbage-out-process).
Limitations of MIS

Mis unit i

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Mis unit i