Management Information

System
Credit Units: 3

Surbhi Tyagi
Ass. Prof. - IT
Module II: Introduction to Information Systems
in Business Management

• Introduction to commonly used system and models

• Types of IS(TPS, OAS, MIS, DSS, ESS)
• Relationship between IS, organizations and business processes
• Information management and decision
• Making Managing international Information systems
MANAGEMENT INFORMATION SYSTEMS

There are different interests, specialties and levels in an organization and

accordingly there are different kinds of system and information requirements.
No single system generally provides all the information needs of an
Organization.The above diagram illustrates one way to depict the kinds of
systems found in an organization:

• Top or Strategic level

• Middle or Tactical Level

• Bottom or Supervisory or Operational Level

 Categories of Information System

Management at different level take decisions matching to their hierarchy position in the
organization and different types of information system are designed and developed for them.
• The lowest level/operational/ is managed by operational level mangers. The routine office
work are mostly done at this level. No decision-making process is carried out here, but
proper organization and processing of data is important task. So, data processing systems
like TPS are developed for them.

• levels/ Tactical/Managerial management is responsible for routine decision makingThe

middle . To help them information system like MIS is designed for them. It collects data
from internal and external sources and provides information to management.

• The top-level/ Strategical/Executive management is responsible for non-routine, strategic

decision making. To help them information system like DSS is designed for them. It helps
them by providing information and decision model.
Key Characteristics and Purposes:
•Data Focus:
• TPS: Data capture and processing for operational activities.
• MIS: Summarized data for monitoring and control.
• DSS: Analytical tools for decision support.
• ESS: High-level data for strategic planning.
•User Levels:
• TPS: Used by operational staff.
• MIS: Utilized by middle managers.
• DSS: Targeted at managers and analysts.
• ESS: Designed for top executives.
•Decision Types:
• TPS: Routine, structured decisions.
• MIS: Tactical decisions based on summarized data.
• DSS: Semi-structured and unstructured decisions.
• ESS: Strategic decisions for long-term planning.
Commonly used system and models

Tele conferencing
system
• Types of Information Systems (IS):

• Transaction Processing Systems (TPS):

• TPS are used to record and process day-to-day business
transactions.
• Focus is on data collection, storage, and retrieval for
operational tasks.
• Examples: Sales transactions, inventory management,
payroll processing.
• Office Automation Systems (OAS):
• OAS support routine administrative tasks within an office
or organization.
• They automate document management, communication,
and collaboration.
• Examples: Word processing, email systems, scheduling
tools.
• Management Information Systems (MIS):
• MIS provide middle managers with summarized, structured
reports and information.
• They aid in monitoring, controlling, and decision-making at
the tactical level.
• Examples: Sales reports, inventory summaries, performance
dashboards.
• Decision Support Systems (DSS):
• DSS assist managers in making semi-structured or
unstructured decisions.
• They use data analysis tools and models to provide insights
for decision-making.
• Examples: What-if analysis, forecasting tools, scenario
planning.
Operations Support System (OSS)
OSS is aimed to improve operational efficiency of the enterprise for day-to-day operations & daily
routine tasks. It is further classified into three categories : TPS, MIS and ERP.

Transaction Processing System (TPS)

• All business activity such as Sales, Purchase, Production, Transportation, Payment, Receipt etc.
involves transaction and these transactions are to be organized and manipulated to generate
information.

• TPS is fully automated system which is aimed at improving routine transaction processing
activities. Reports generated by TPS are used by bottom level of
management.

Typically, TPS involves the following activities –

1. Capturing data to organize in files or databases related to any transaction.
2. Processing of files / database using application software.
3. Generating information in the form of reports.
4. Processing of queries from various functional areas of organization.
Transaction Processing System

Features of TPS –

• Large volume of data: TPS is transaction-oriented hence it generally

handles large volume of data.

• Automation of basic operations : TPS aims to automate the day-to-day

functioning of the enterprise related to transactions.

• Benefits are easily measurable ".Most of the benefits of TPS are tangible
and easily measurable.

• Source of input for other systems: Output of TPS is used as input to other
systems.
ERP : Enterprise Resource Planning

"An ERP is a fully integrated business management system that integrates the
core business and management processes to provide an organization a structured
environment in which decisions are supported by accurate and reliable real-time
information.” It serves as the business backbone by providing a centralized
database and real-time visibility into critical data, streamlining operations, and
improving decision-making in terms of resources i.e., money, people & time.

Objectives
• Provide support for adopting best business practices
• Implement these practices with the view towards enhancing productivity and
• Empower the customers and suppliers to modify the implemented business
processes to suit their need.
Management Support Systems (MSS)
MSS focus on the managerial uses of information resources and provide information to
managers for planning and decision making. It is further classified into three categories:
DSS, EIS and ES.

Decision Support System (DSS)

DSS is a system that provides tools to managers to assist them in solving semi-structured
and unstructured problem in their own way. DSS is not intended to make decisions for managers,
but rather to provide managers with a set of capabilities that enable them to generate the
information's required by them. Such systems are particularly useful to higher level managers
whose requirement for information are somewhat unpredictable. Unlike MIS, which provide
fixed, pre-formatted information in a standardized way, DSS is more flexible and adaptable to
changing decision making requirement.
Components of A DSS : A DSS has 4 basic components : User, Data bases,
Planning language and Model Base.

• A manager with an unstructured or semi- structured problem at any level of

authority is the user of DSS.

• User need not have computer background to use DSS, but thorough
understanding of the problem and factors to be considered in finding the
solution is important.

• A special planning language perform the communication between DSS and

user, therefore user can concentrate on what should be accomplished rather than
how to accomplish.
Executive Information System (EIS)
EIS, sometimes referred to as an Executive support system (ESS) is designed to meet the
special need of top-level executives. Executive is a managers at or near the top of the
organization hierarchy who has a strong influence on the plans and operations taken by
the organization. Executives are the good link between top and other level of
management.

Characteristics of EIS

"An EIS is a tool that provides direct on-line access to relevant information in a useful &
navigable Format. It has the following characteristics -
• Specifically designed to meet executive's information need.
• Able to access data about specific issues and problems.
• Used directly by executive with out technical assistance
• Present summary information instead of details
• Able to manipulate data to perform “what –if” analysis
• Require large amount of storage & processing capacity in both terminal & server
Expert System (ES)
Expert systems are the software's that imitate the reasoning processes of human experts and
provide decision makers with the type advice they would normally receive from such
experts.
Business Application of ES are :-
•Accounting and Finance: Tax advice and assistance, Forecasting, Providing investment
advice etc.
• Marketing: Sales quotas, Handling customers inquiries, Discount policies, Telemarketing
• Manufacturing: Process controlling, Quality controlling, Production scheduling, Selecting
transporting route, Fault monitoring etc.
• Personnel: Recruitment, Training, Task assignment, Performance appraisal
• General business: Evaluating project proposal, Strategy selection, Reporting etc.
Benefits of ES
• ES preserve the knowledge of an expert who is leaving the organization.
• ES put information into an active-form(readily accessible).
• ES assist in solving the problem they professionals do.
Office Automation Systems (OAS) OAS are among the newest and most rapidly expanding
computer-based information systems. Different office activities can be broadly grouped
together into following categories
Document capture: This consists of capturing incoming documents such as mails, notes,
handouts, graphs etc.
Document creation: This consists of preparation of documents, tacking dictation, editing texts
etc.
Receipts and Distribution : This includes distribution of correspondence to designated
recipients.
Filling, Search, Retrieval and Follow up: This includes document filling, indexing and
searching.
Calculation: This includes routine arithmetic calculation for bill processing, interest
calculation, commission calculation etc.
Recording usage of resources: This includes Record keeping, Logbook maintenance etc.
Benefits of OAS
• Improve communication within and between organization
• Reduce cycle time between preparation of messages and receipts of messages
• Reduce cost and time of office communication.
• Ensure accuracy of processing, calculation and communication.
 Management Information Decision Support Systems
Aspect Systems (MIS) (DSS)
Provides information for managerial Offers tools for complex decision
Purpose
oversight. analysis.

Managers, analysts, decision-makers at all

Users Middle-level managers.
levels.

Data Focus Structured data. Unstructured data.

Provides interactive analysis tools,

Functionality Generates reports and summaries.
modeling.

Advanced analysis, explores insights,

Analysis Basic analysis.
scenarios.

Semi-structured, unstructured,
Decision Types Routine decisions, operational oversight.
exploration.

Examples Sales reports, inventory summaries. What-if analysis, scenario planning.

Relationship between Information Systems, Organizations, and Business
Processes:

1.Information Systems (IS):

1. Information Systems encompass the integration of people, processes, data,
and technology to support business activities and decision-making.
2. IS collect, process, store, and distribute information for various
organizational functions.
2.Organizations:
1. Organizations are structured entities with defined goals, roles, and
responsibilities.
2. They use Information Systems to manage operations, coordinate activities,
and achieve objectives.
3.Business Processes:
1. Business Processes are structured sets of tasks that transform inputs into
outputs to achieve specific objectives.
2. They span various functions within an organization and often involve
multiple steps and participants.
Relationship between Information Systems, Organizations, and
Business Processes:
Impact of IS on Business Processes:

1. Efficiency: IS streamline processes, reducing time and

resource consumption.
2. Accuracy: Automation minimizes errors and ensures data
accuracy.
3. Visibility: IS provide real-time visibility into process status
and performance.
4. Standardization: IS enforce consistent processes, leading
to standardization and quality control.
5. Innovation: IS can enable process innovation by
introducing new technologies or approaches.
Information Management:
1. Information Management (IM) involves the process of
collecting, organizing, storing, retrieving, and disseminating
information within an organization.
2. IM aims to ensure that the right information is available to
the right people at the right time to support decision-making
and business processes.

Role of Information Management:

1. Provides a structured approach to handling information
assets.
2. Ensures data accuracy, integrity, security, and availability.
3. Facilitates efficient access and retrieval of relevant
information.
4. Supports knowledge sharing and collaboration among
employees.
Decision Making: Decision-making is the process of selecting the best course of
action among available alternatives to achieve a specific goal or objective. It involves
analyzing information, evaluating options, and choosing the most suitable solution.

Role of Information in Decision Making:

1. Data Collection: Relevant data and information are gathered to provide a
basis for decisions.
2. Analysis: Information is analyzed to identify trends, patterns, and insights.
3. Contextualization: Information is placed in the context of the decision at
hand.
4. Options Evaluation: Different courses of action are evaluated based on
available information.
5. Risk Assessment: Information helps assess potential risks and outcomes of
decisions.
6. Informed Choices: Decision-makers use information to make well-informed
choices.
Impact of Effective Information Management on Decision Making:

•Accuracy: Reliable and accurate information leads to sound

decisions.
•Timeliness: Timely information ensures decisions are made in a
relevant context.
•Relevance: Access to pertinent information prevents making
decisions based on incomplete data.
•Consistency: Consistent information across departments fosters
alignment in decision-making.
•Efficiency: Efficient information retrieval speeds up the decision-
making process.
Decision-Making Process:

Step 1: Identification of the Problem or Opportunity

•Recognize the need for a decision due to a problem or an opportunity.
Step 2: Gathering Information
•Collect relevant data and information to understand the situation and potential
options.
Step 3: Identifying Alternatives
•Generate a range of possible solutions or courses of action.
Step 4: Evaluating Alternatives
•Assess the pros and cons of each alternative based on criteria and priorities.
Step 5: Making the Decision
•Choose the best alternative that aligns with goals, constraints, and available
information.
Step 6: Implementation
•Put the decision into action by executing the chosen alternative.
Step 7: Monitoring and Evaluation
•Continuously assess the outcomes of the decision to ensure it meets expectations.
Types of Decision-Making Process:

1. Structured

2. Unstructured

3. Semi-Structured:
Structured Decision Making:

•Definition: Structured decision making involves well-defined,

routine decisions that follow established procedures and rules.

•Characteristics:
• Clear and repetitive nature of the decision.
• Objective criteria and guidelines are available.
• The process is usually highly formalized.
•Examples:
• Processing customer orders.
• Calculating employee payroll.
• Inventory replenishment based on predefined thresholds.
Unstructured Decision Making:

•Definition: Unstructured decision making pertains to

complex, novel, and non-repetitive situations lacking
clear guidelines.
•Characteristics:
• Lack of predetermined steps or established
procedures.
• Ambiguity and uncertainty are prevalent.
• Decision makers rely on intuition and creativity.
•Examples:
• Developing a new product concept.
• Crafting a crisis response strategy.
• Addressing an unforeseen market disruption.
Semi-Structured Decision Making:
•Definition: Semi-structured decision-making falls between
structured and unstructured decisions, incorporating
elements of both.
•Characteristics:
• Some aspects follow established procedures, while
others require flexibility.
• Specific guidelines may apply to certain parts of the
decision process.
• Decision makers have room for judgment and
interpretation.
•Examples:
• Evaluating job candidates during a hiring process.
• Selecting a vendor for a project.
• Determining pricing strategy for a new product.
Managing International Information Systems:

International Information Systems (IIS): International Information Systems (IIS)

refer to the management of information systems in a global context. Businesses
operate in a highly interconnected world, necessitating effective management of IIS.

International information systems are a general class of computer networks that

operate in more than one nation- state. General international systems can be
distinguished from more specific systems through their linkage to functionality, the
sole limiting criteria being the providing of informational support to transactions
that originate in one nation-state and terminate in another

The basic strategy to follow when building an international system is to understand

the global environment in which your firm is operating. This means understanding
the overall market forces, or business drivers, that are pushing your industry toward
global competition
The major elements for developing International
information systems architecture are:

1. Global environment

2. Corporate global strategies

3. Structure of the organization

4. Management and business process

5. Technology platform
Challenges in International Information Systems Management:
1. Cultural Diversity: Different cultures affect communication, collaboration, and
decision-making.
2. Legal and Regulatory Variations: Compliance with diverse international laws
and regulations.
3. Language Barriers: Effective communication and information sharing across
languages.
4. Time Zone Differences: Coordination and real-time collaboration across time
zones.
5. Infrastructure Disparities: Varied technology infrastructure and internet
access in different regions.
6. Data Security and Privacy: Ensuring data protection in compliance with
various laws.
7. Global IT Governance: Coordinating IT operations and standards across global
subsidiaries.
1.Emerging Technologies and IIS:
1.Blockchain: Enhancing transparency and security
in global supply chains and transactions.
2.AI and Machine Learning: Improving decision-
making and customer experiences globally.
3.IoT (Internet of Things): Monitoring and
managing global operations and assets in real time.
2.Case Studies and Best Practices:
1.SAP's Global Implementation: An example of a
company implementing a global ERP system.
2.McDonald's Localization Strategy: Tailoring
menus and marketing to local tastes.
THANK YOU!
Q1. The routine office work are mostly done at this level. No decision-making process is carried
out here, but proper organization and processing of data is important task including transactions.
a. Operational
b. Strategic
c. Tactical

Q2. Which level of management is responsible for routine decision making. To help them
information system like MIS is designed for them.
a. DSS
b. MIS
c. TPS
d. OAS

Q3 Strategic level takes decision on which type of data?

a. Structured
b. Unstructured
c. Semi structured
Q4 In tactical level which type of decision type is used?
a. Structured
b. Unstructured
c. Semi structured

Q5 Which type of E commerce system is used to sell products directly to customers?

a. B2B
b. C2C
c. B2C
d. C2 B

Q6. Which level deals with day-to-day documentation and scheduling of the business process?
a. Operational
b. Strategic
c. Tactical
Q7 5 years sales trend forecasting is an example of which type of level of management?

a. Operational
b. Strategic
c. Tactical

Q8 What-if analysis is done in which type of model?

a. MIS
b. DSS
c. TPS
d. OAS

Q9 Which level deals with decision making which are routine based of the business process?
a. Operational
b. Strategic
c. Tactical

Q10 Which level deals with decision making which are unpredictable scenario based of the business process?
a. Operational
b. Strategic
c. Tactical