Q1: Define what does it mean by management information system? What role do MIS play in an organization?
Definition of Management Information System:
A Management Information System is a computer system that stores and distributes information on how a business can successfully be managed in the best way. There are three primary components by which Management Information Systems collect and analyze information, these are people, technology, organizations and the relationships among them. It is a way of using a complete selection of raw data to see how the business can be more productive, efficient, cost effective and faster etc.
Role of Management Information System
The role of the Management Information System in an organization can be compared to the role of heart in the body. The information is the blood and Management Information System is the heart. In the body the heart plays the role of supplying pure blood to all the elements of the body including the brain. The heart work faster and supplies more blood when needed. It regulates and controls the incoming impure blood, processed it and sends it to the destination in the quantity needed. It fulfills the needs of blood supply to human body in normal condition and also in crisis.
The Management Information System plays exactly the same role in the organization. The system ensures that an appropriate data is collected from the various sources, processed and send further to all the needy destinations. The system is expected to fulfill the information needs of an individual, a group of individuals, the management functionaries, the managers and top management.
Here are some of the important roles of the Management Information System:
- The Management Information System satisfies the different needs through variety of systems such as query system, analysis system, modeling system and decision support system.
- The Management Information System helps in strategic planning, management control, operational control and transaction processing. The Management Information System helps in the clerical personal in the transaction processing and answers the questions on the data belong to the transaction, the status of a particular record and reference on a variety of documents.
- The Management Information System helps the junior management personnel by providing the operational data for planning, scheduling and control and helps them further in decision making at the operation level to correct an out of control situation.
- The Management Information System helps the middle management in short term planning, target setting and controlling the business functions. It is supported by the use of the management tools of planning and control.
- The Management Information System helps the top level management in goal setting, strategic planning and evolving the business plans and their implementation.
- The Management Information System plays the role of information generation, communication, problem identification and helps in the process of decision making. The Management Information System plays a vital role in the management, administration and operation of an organization.
Management Information System has assumed all the more important role in today’s environment because a manager has to take decisions under two main challenges: - Because of the liberalization and globalization, in which organizations are required to compete not locally but globally, a manager has to take quick decisions, otherwise his/her business will be taken away by his/her competitors. This has further enhanced the necessity for such a system.
- In this information age, where information is doubling up every two or three years, a manager has to process a large voluminous data, failing which he/she may end up taking a strong decision that may prove to be very costly to the company.
Q2: Explain why it is very important for the managers to keep updating themselves according to the new technology? And also explain the disadvantages to the managers to not update themselves according to the technology?
It is very important for the managers to keep updating themselves according to the technology because technology is essential to every business, even those that are not considered technology companies. You deal with technology in your office productivity software, security system, air conditioning, computers and networks, phone systems, and much, much more. Whether it is a simple cash register program that tracks inventory and daily purchases or a sophisticated network that links people and places around the world, technology helps organizations maintain a competitive edge and build a strong presence in business world. If you want to compete in today business world, then it is important to keep up with technology in order to get the most out of the technology you have, to keep abreast of emerging new technology and to find the information that will help you make the right buying decisions.
Technology is a broad concept that has come to refer to breakthroughs in science that allow for a better or automated solution. While the most obvious benefit to technology in business is increased productivity, which translates into a lower cost structure, without using technology you can’t increase productivity there are some other benefits that can help the bottom line as well. Improved speed, the ease of sharing and storing information and a decrease in human error through automation add up to a reduction in costs and an increase in revenue.
Disadvantages of not Using Technology:
Can’t reach a much larger audience from greater geographic locations.
Can’t help employee with busy schedules, freedom to work at home on their own time
Can’t decrease paper and photocopying costs, promoting concept of "green revolution"
Difficult to access and save information about every employee.
Difficult to train employee to learn new technology skills they can use in the work place
Difficult to manage, develop and retain ideas and internal knowledge.
Difficult to communicate and interact more effectively within an organization.
Difficult to create more environmentally friendly and sustainable business practices.
Q3: What is the purpose of Decision Support System in MIS? List few characteristics of DSS?
Decision Support System refers to a class of systems which help in the process of decision making and not always give a decision itself. Decision Support Systems (DSS) are a specific class of computerized information system that supports business and organizational decision making activities.
A properly designed Decision Support System is an interactive software based system intended to help decision makers collect useful information from raw data, documents, personal knowledge or business models to identify and solve problems and make decisions.
The Decision Support System basically helps in the information system in the intelligence phase where the objective is to identify the problem and then go to the design phase for solution. The choice of selection criteria varies from problem to problem.
It is therefore, required to go through these phases again and again till satisfactory result is found. In the following three phase cycle, we may use inquiry, analysis, models and accounting system to come to rational solution.
These systems are helpful where the decision maker calls for complex manipulation of data and use of several methods to reach an acceptable result using different analysis approach. The decision support system helps in making a decision and also in performance analysis. Decision Support System can be built around the rule in case of programmable decision situation. The rules are not fixed or predetermined and requires every time the user to go through the decision making cycle.
Attributes:
I) Decision Support System should be adaptable and flexible.
II) Decision Support System should be interactive and provide ease of use.
III) Effectiveness balanced with efficiency.
IV) Complete control by decision makers.
V) Ease of development by (modification to suit needs and changing environment) end users.
VI) Support modeling and analysis.
VII) Data access.
VIII) Standalone, integration and Web based
Decision Support System Characteristics:
I) Support for decision makers in semi structured and unstructured problems.
II) Support for managers at various managerial levels, ranging from top executive to line managers.
III) Support for individuals and groups. Less structured problems often requires the involvement of several individuals from different departments and organization level.
IV) Support for interdependent or sequential decisions.
V) Support intelligence, design, choice, and implementation.
VI) Support variety of decision processes and styles.
VII) Decision Support Systems are adaptive over time.
Q4: How are databases used in e-business? How e-business fit into different locations within the production chain?
Databases are integral to the success of an e-business. They enable us to store, analyze and manage essential information about our products, our sales and our customers so we can quickly and easily respond to changing market conditions. We can also share information in the database with suppliers and logistics partners to improve the efficiency of our e-business operations.
Product Information:
We can use our e-business database to hold and update information on our products, including detailed product descriptions and specifications, product reference numbers, prices, promotional offers and availability. We can also include details of the supplier for each product that we stock. By updating the information in the database, rather than changing and publishing individual website pages, we can save time and ensure our website always shows visitors the latest information.
Customer Information:
The database should hold information on our customers, including their full names and contact details. For business customers, include the type and size of business and their industry sector. For consumers, add any personal information that would be relevant to their buying potential, such as age range, income, demographic details and interests. In some countries, data protection legislation applies to personal information that organizations hold on a database, so ensure that we comply if our sell in export markets.
Transactions:
The basic customer information is important for administration of our e-business. By recording information on customer’s product searches, information requests and purchases, we can also build a detailed picture of individual customer’s product preferences, purchasing history and future buying potential.
Personalization:
The detailed customer profiles enable us to make personalized offers to customers based on their preferences. If our website sells sportswear, for example, we could create promotional campaigns targeted at all the male customers in our database who play golf and prefer a specific brand. We can also use the database to customize prices for our larger business customers. When a customer selects a product and requests a price, the database returns the price or discount us have set for that company.
Campaign Management:
We can assess the effectiveness of our marketing campaigns and product offers by analyzing the transaction information in our database and producing reports. Compare sales before and after the campaign to identify the most successful campaigns. By analyzing trends in sales of different products in our portfolio, we can make changes to prices, product mix or stock levels.
Self Service:
With the right level of security in place, we can give customers, suppliers and logistic partners access to certain areas of our database. Customers, for example can check on their order history and delivery status of outstanding orders. By giving suppliers access to stock levels, we can help them to plan their own production schedules more efficiently. Logistics partners can check on current orders so they can plan their delivery schedules.
E Business in a Supply Chain:
A supply chain is a system of people, resources, organizations, activities, technology and information involved in moving a product or service from supplier to customer. Supply chain activities transform natural resources, raw materials and components into a finished product that is delivered to the end customer.
E-business involves the execution of business transactions over the Internet. Companies conducting e-business perform some or all of the following activities over the Internet across the supply chain:
I) Tracking orders
II) Filling and delivering orders
III) Paying and receiving payment.
E-Business on Supply Chain Performance:
Impact of E-business:
E-business allows firms to enhance revenues by direct sales to customers. Manufacturers and other members of the supply chain that do not have direct contact with customers in traditional retail channels can use the Internet to shrink the supply chain by bypassing retailers and selling direct to customers. This geographical centralization reduces required inventory levels because of increased economies of scale in the supply and reduced aggregated variability in the demand.
An e-business can decrease processing cost if they can increase the amount of customer participation. For example, customers purchasing online from L.L. Bean do all the work of selecting the product, placing and order, and paying.
Maintaining a competitive supply chain requires relentless reduction of costs. In the area of order operations this includes reducing the steps and time required to enter an order, as well as avoiding mistakes that would require manual corrections later.