Management Information System

Organization And Information Systems

System:
A system is a collection of elements/components that interact with each other to accomplish the defined goal
Eg:
University system
Banking system
University system:
The components are: admission, teaching, examination, evaluation
Each of these components interacts to train and graduate the student

Page | 1
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems

Each component in turn may be system (sub)

In general, a system has 3 basic elements;
Input
Processing
Output
To support interaction a feedback mechanism is incorporated and graphically shown as;

Page | 2
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems

Information System (IS):

An information system is a set of interrelated elements that collect (input) data, manipulate (process) data and
disseminate (output) information and provide a reaction (feedback) to meet the objective
If an information system is automated using computer as machine, then it is referred as Computer Based Information
System (CBIS) and is the blend of Information System and Computer System (Hardware & Software)
Information Technology:
Refers to the technology of
 storing
 retrieving
 processing
 communicating
 sharing
 protecting/securing

Page | 3
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems
Data/information across geographical locations
Makes use of
Computer (hardware/software) technology
Storage technology
Communication technology

Organizational structure:

Page | 4
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems

Environment:
It is the real world surrounding the boundary of a system
Boundary:
An imaginary area encompasses the system and separates it from the environment
Changing Environment and its impact on business:
Any change in the environment will introduce some sort of pressure/stress on system to undergo change in the system
If changes are not accommodated in the system, the system starts decaying and terminates finally
The changes are accommodated by:
- changing the goal set of the system (new goals)
- changing the levels in achieving the goals
Page | 5
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems
Types of changes in environment:
- Economical (Capital, Labor, Price change, Fiscal and monetary policy, customers)
- Technological
- Social
- Political
- Ethical
Data: The term ‘data’ represents
Facts or figures
About an event/object/entity
Eg:
USN, Name, Branch, DOB, Sex... etc,
Represents data about the entity/object student
Acc#, prev_bal, amt_credited, new BAL... Etc,
Represents data about the event of bank transaction

Page | 6
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems
Information:

Information is the data that has been processed into a form that is meaningful to the recipient in order to take
appropriate actions/decisions
Eg:
Summing all the marks and finding the average of marks scored by students to declare the class obtained.
Searching all the customers in the bank who have not remitted the last 3 installments towards loan to send reminder
Terms data and information are interchangeably used in many context but in reality the two are different
In a vague way, data is like the raw material for processing and information is like the finished product of processing
Information of one processing may become data for another processing
Attributes of data:
The quality of data/information depends on the attributes associated with it
- Accuracy
- Timeliness
- Completeness

Page | 7
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems
- Consistency
- Reliability
- Relevance
- Privacy/protection
- Source
- Communication ability
Levels of people:
3 levels of people are involved in any typical organization
- Operational level Management
- Middle level Management
- Top level Management
Operational management involved in
 planning
 scheduling
 controlling and
 decision making for routine operations

Page | 8
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems
Unit manager, supervisor
Eg: production of number of items to be manufactured/fabricated per unit to meet the production target
Middle management involved in
 short term planning
 setting targets
 controlling
 business functions
Production manager, purchase manager
Eg: A production mangers sets the target for production of number of items for next quarter based on demand from the
marketing division and plan to ship the same across business centers.
Top management involved in
 goal setting
 strategic planning
 evolving business plans
 implementation of plans
Managing Director, CEO, CAO, CE, Chairman
Eg: Planning for production of new product

Page | 9
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems

Information needs for different levels of people:

Page | 10
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems

According to decision oriented view Management mainly comprises of the following:

 Planning
 Organizing
 Coordinating
 Directing
 Control
Decisions:
Decisions are the actions to be taken in order to support the management in the business activities.
Two types of decisions:
- programmed decisions
- Non-programmed decisions
Programmed decisions:
These decisions are characterized by large volume of data and predefined
 rules
 procedures
Page | 11
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems
 algorithms
And decisions can automated easily
Handled by operational management
Decisions are structured and frequency for decision is frequent
The result of the decision guarantees optimal solution

Techniques used:
Linear programming
Simulation models
Statistical models
Eg: finding optimal product mix,
Minimum cost production schedule,
Optimal sequencing of machines,
Minimizing mean flow time
Non-programmed decisions:
Page | 12
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems
These decisions do not have pre-established
 rules
 procedures
 algorithms
 data requirements are not known advance
Cannot be automated easily and completely

Need for decision is not frequent

Environmental, social, technical information is required which keep changing with respect to time, geographical location
Unstructured decisions due to change in type of parameters and number parameters keep changing
The outcome of the decision will not guarantee optimal solution but it may be near to optimal solution
Eg:
Decision Support systems – interactive information systems that support/help in taking unstructured/ non-programmed
decisions
JIT – Just-In-Time production decisions
TQM – Total Quality Management decisions

Page | 13
MIT- Maharaja Institute of Technology
Management Information System
Organization And Information Systems

Page | 14
MIT- Maharaja Institute of Technology