Information Technology

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UNIT 1

 MIS
 Importance, Evaluation
 Organisational Structure, Features
 Logical foundations, Typical MIS
 DSS-Introduction,Definition,Evaluation,Model
Management, DSS Generators, Multicriteria Modelling.

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MIS : Management Information System
 INTRODUCTION :
 The term Management Information System (MIS) is of relatively
recent origin and is widely adopted following the accelerated use of
computers in the early 1960's.
 The Management Information System to business what is the
nervous system is to the human body. It is described as
"informational blood stream" of an organisation.
 It encompasses a wide range of subject matters like management
theory, communication theory, human processing of data and
information technology.
 Management Information System has something significantly to do
with two important management functions namely, planning and
controlling.
 The basis for Management Information System is that computers, in
addition to data processing, can serve as fine tools to improve the
planning and control of operations by providing better information for
decision making.

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MIS : Management Information System
 Definition :
 Management Information System can be defined as a collection of
data processing equipment, procedures, software and people that
integrates the sub-systems of the organisation and provides
information for decision making on planning and control operations.
 In other words, Management Information System is an integrated
user-machine system that monitors and retrieves data from the
environment, captures data from transactions and operations within
the firm, filters, organises and selects data and presents them as
information to managers, and also provides the means for managers
to generate information as desired.
 In simple terms Management Information System is any organised
approach for obtaining relevant and timely information on which to
base management decisions.

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 Historically, accounting systems provide information for planning and
control in business. Managers have always had sources of
information.
 But Management Information System, with computerised processing
of data provides a comprehensive system of information.
 Management Information System is a powerful method for aiding
managers in operations analysis for solving problems and making
decisions.

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Author Definition

 "Management Information System is a system that aids management

in making, carrying out and controlling decisions". Here management
information system is a system that aids management in performing
its job. - J. Kanter.

 A Management Information System is "an integrated man/machine

system for providing information to hold up the operations,
management and decision making functions in an organization." Here
the system utilizes hardware and software, manual procedures,
management decision model and data base. - GB. Davis.

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Some Examples of MIS

 Airline reservations (seat, booking, payment, schedules, boarding list,

special needs, etc.).
 Bank operations (deposit, transfer, withdrawal) electronically with a
distinguish payment gateways.
 Integration of department with the help of contemporary software’s
like ERP.
 Logistics management application to streamline the transportation
system.
 Train reservation with the help of IRCTC.

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 Nature of MIS

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Nature of MIS

 Management Information Systems (MIS) can be simply referred to as

a system or process that facilitates the smooth working of the
organisation.
 The nature of MIS is truly multifold because it plays a bigger role in
business decisions, from costs to employee management. Here are
the major features that portray the nature of MIS:
 MIS is utilised by every level of a management.
 It clarifies and focuses on the strategic goals and objectives for the
management.
 MIS provides an effective system to analyse costs and revenues and
further reviews effectively and efficiently to bring a balanced in
finances and costs.

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 MIS is maintained either through manual systems or automated
systems or a combination of both.
 It also plays a incremental role in identifying, locating, measuring,
tackling and limiting risks.
 It lays down a framework of rules and regulations for the
management to bring a clear and concise communication between
employees.
 MIS provides an objective system of collecting, assessing and
aggregating information for a business.

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 Most important reasons to have a good
management information system :

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Most important reasons to have a good
management information system :
1. To control the creation and growth of records
 Despite decades of using various non-paper storage media, the
amount of paper in our offices continues to escalate. An effective
records information system addresses both creation control (limits the
generation of records or copies not required to operate the business)
and records retention (a system for destroying useless records or
retiring inactive records), thus stabilizing the growth of records in all
formats.

 To reduce operating costs

 Recordkeeping requires administrative dollars for filing equipment,
space in offices, and staffing to maintain an organized filing system
(or to search for lost records when there is no organized system).

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 3. To improve efficiency and productivity
 Time spent searching for missing or misfiled record is non-productive.
A good records management program (e.g. a document system) can
help any organization upgrade its recordkeeping systems so that
information retrieval is enhanced, with corresponding improvements
in office efficiency and productivity. A well designed and operated
filing system with an effective index can facilitate retrieval and deliver
information to users as quickly as they need it.

 4. To assimilate new records management technologies

 A good records management program provides an organization with
the capability to assimilate new technologies and take advantage of
their many benefits. Investments in new computer systems whether
this is financial, business or otherwise, don't solve filing problems
unless current manual recordkeeping or bookkeeping systems are
analyzed (and occasionally, overhauled) before automation is
applied.

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 5. To ensure regulatory compliance
 In terms of recordkeeping requirements, there are certain laws which
can create major compliance problems for businesses and
government agencies since they can be difficult to locate, interpret
and apply. The only way an organization can be reasonably sure that
it is in full compliance with laws and regulations is by operating a
good management information system which takes responsibility for
regulatory compliance, while working closely with the local
authorities. Failure to comply with laws and regulations could result in
severe fines, penalties or other legal consequences.
 6. To minimize litigation risks
 Business organizations implement management information systems
and programs in order to reduce the risks associated with litigation
and potential penalties. This can be equally true in Government
agencies. For example, a consistently applied records management
program can reduce the liabilities associated with document disposal
by providing for their systematic, routine disposal in the normal
course of business.

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 7. To safeguard vital information
 Every organization, public or private, needs a comprehensive
program for protecting its vital records and information from
catastrophe or disaster, because every organization is vulnerable to
loss. Operated as part of a good management information system,
vital records programs preserve the integrity and confidentiality of the
most important records and safeguard the vital information assets
according to a "Plan" to protect the records. This is especially the
case for financial information whereby ERP (Enterprise Resource
Planning) systems are being deployed in large companies.
 8. To support better management decision making
 In today's business environment, the manager that has the relevant
data first often wins, either by making the decision ahead of the
competition, or by making a better, more informed decision. A good
management information system can help ensure that managers and
executives have the information they need when they need it.

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 9. To preserve the corporate memory
 An organization's files, records and financial data contain its
institutional memory, an irreplaceable asset that is often overlooked.
Every business day, you create the records, which could become
background data for future management decisions and planning.

 10. To foster professionalism in running the business

 A business office with files, documents and financial data askew,
stacked on top of file cabinets and in boxes everywhere, creates a
poor working environment. The perceptions of customers and the
public, and "image" and "morale" of the staff, though hard to quantify
in cost-benefit terms, may be among the best reasons to establish a
good management information system.

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Evaluation of MIS

 Evaluation of MIS is a process in which the performance of an

organizational MIS is determined. According to the performance
results, the organization evaluates and implements the necessary
modifications in MIS. Various terms related to the evaluation of MIS
are,
1. Evaluation approaches
2. Evaluation classes
3. Product-based MIS evaluation
4. Cost/benefit-based evaluation

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1) Evaluation Approaches

 Various approaches are used to evaluate the organizational MIS

performance. The most common approaches are,
 Quality Assurance Review: The quality assurance review is also known as
a technical review. It determines the technical quality performance of MIS.
The quality assurance review determines the data transmission rate, main or
secondary storage, and CPU capacity.
 Reliability and Accuracy: Reliability and accuracy is a key indicator of
measuring the performance of an MIS. The usefulness of the resulting
information is usually determined by the precision of the data, it uses some
parameters to find reliability and accuracy.
 Timeliness of Information: The results of MIS must be recent. And when
evaluating patterns, management must make assumptions about the
organization's future, based on MIS data. A more recent on MIS, decision
making always reflects on current reality and correctly predict their impact on
the business. If the data collection and processing delay its availability, the
MIS must take into account its potential age-related inaccuracies and present
the resulting information accordingly, with probable error ranges.

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2) Evaluation Classes

 To evaluate the performance of MIS, the following two classes are

used,
 Effectiveness: The effectiveness class determines the quality of the
MIS output. MIS is effective if the quality of its output is good and the
process of producing output is right.
 Efficiency: The efficiency class specifies the total amount of
resources required by MIS to obtain the output.
 Completeness of Information: For a specific decision, a successful
MIS provides all the most important and valuable information
completely. If any information is not available due to missing data, the
gaps are highlighted and potential possibilities are either shown or
possible implications arising from missing data are addressed.
 The relationship between effectiveness and efficiency can be defined
as effectiveness is a measure of the quality of an MIS output, while
efficiency is a measure of the resources required to achieve the
output.

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3) Product-based MIS evaluation

 The product-based MIS evaluation is also known as effectiveness

evaluation. Determines the effectiveness of an MIS output. For
assessing the effectiveness of MIS output, a model structure may be
used.
 Model Structure: A model structure is a structure that contains
various information attributes such as timeliness and relevance. To
determine the MIS effectiveness in an organization, we need to
determine the information attributes for the MIS output.

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 Some of commonly used attributes are,Timeliness: Real-time
information may be called information that is evaluated in a very short
period.
 Relevance: Questions such as timeliness, authority or novelty of the
outcome may include significance.
 Accuracy: The accuracy of information or measurements is their
consistency, even in small details, of being accurate or correct.
 Completeness: Completeness' refers to how comprehensive the data is.
 Adequacy: The ability to obtain the information required for decision
making in a timely and reliable manner.
 Explicitness: The degree to which the MIS is consistent with the
particular organization.
 Exception-based: MIS should be built based on the exception-based
reporting concept, which implies an irregular condition where the
maximum, minimum, or predicted values differ outside the limits.
Exception reporting should be given to the decision-maker at the
appropriate level in such cases.

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4) Cost/benefit-based evaluation

 Cost-based evaluation of the MIS system determines the benefits

expected from the developed system. Different approaches are used
to measure the cost and evaluate the various benefits to
organizations. The approaches of cost-benefit analysis are used to
find out the feasible solution. The benefits to be expected from the
system and expected benefits are carried out in the cost/benefit
calculation of the different expected costs. The measurement of
cost/benefit decides the system's cost-effectiveness.

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Structure of MIS

 A management information system (MIS) is an organized

combination of people, hardware, communication networks and data
sources that collects, transforms and distributes information in an
organization.
 An MIS helps decision making by providing timely, relevant and
accurate information to managers. The physical components of an
MIS include hardware, software, database, personnel and
procedures.

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 HARDWARE
 All physical components of a computer system compose the
computer hardware. Important components include the central
processing unit, input/output devices, storage units and
communication devices. Communication can be over fiber-optic
cables or wireless networks.
 SOFTWARE
 Software provides the interface between users and the information
system. Software can be divided into two generic types: system
software and applications. The system software comprises of the
operating system, utility programs and special purpose programs.
Applications are developed to accomplish a specific task. For users
of MIS it is much more important to understand the software than the
hardware. Software maintenance can take 50 to 70 percent of all
personnel activity in the MIS function. When the organization moves
to implement an advanced information system the hardware and
software environment becomes more complex.

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 DATABASE
 A database is a centrally controlled collection of organized data.
Central control reduces redundancy and duplication of data. Data is
stored in an organized and structured way to facilitate sharing and
improve availability to those who need it. The database improves
efficiency of storage by elimination of redundant files and improves
efficiency of processing by providing all required data in a single file
rather than separate files. This also improves efficiency of information
retrieval.

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 PROCEDURES
 Three types of procedures are required for an MIS to operate
effectively: user instructions, instructions for input preparation and
operating instructions for MIS personnel who maintain the MIS.
 PERSONNEL
 The personnel in the MIS function include computer operators,
programmers, systems analysts and managers. Human resource
requirements should be assessed by considering both the present
system needs and the future system growth. The quality of MIS
personnel is a key factor in its effectiveness. An MIS manager needs
a combination of both managerial and technical skills.

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Features of Management Information
System
 1) Integrative system :
 An MIS is logically integrated system comprising of subsystem, where
activities of each are interrelated . this integration is possible by the auto
rotation of data among the sub system.

 2) Sub- system concept:

 Alto system is considered a single entity, but a big system is divided into
sub system. so that one such system can be implemented at a time , for
better effectiveness.

 3) Provides relevant information to management:

 MIS should provide only relevant information to managers. At times ,
determining relevant information becomes very difficult, especially when
and analyses of problems is done differently by different managers,
according to the varying circumstances. Thus, MIS provides relevant
information and helps in reducing confusion and solving problems.

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 4) Flexible :
 A MIS must be one that can be easily modified to changing
circumstances.
 It must be capable of expansion , accommodate growth or new type
of processing activity and contraction as and when required.

 5) Enhances productivity :
 MIS oh whole improves the efficiency of an organization. It helps in
efficient document preparation, provides high level of services to
individuals and external organization, help in early detection of
warning about internal and external problems ,and also in identifying
opportunities. It assist in the overall management of organization and
improve the managers ability to deal with unexpected problems.

 6) Co-ordinated system :
 MIS is centrally synchronized so that all its components such as data
processing, office automation , intelligence and decision support
system, are developed and managed in a planned and coordinated
manner.
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 6) Feed back System :
 MIS provides feedback about its own efficiency and effectiveness.
The system itself provides statistics about by 'whom and 'how much'
the system has been used.

 8) Management Oriented :
 MIS is design from top to bottom corner but not necessarily start from
the management needs of the overall business goals. this means
that the system may be developed keeping in mind the needs of the
middle/operation management as well as the top management to
stop .this ensures a good MIS.

 9) Management Directed :
 It is imperative that management should dynamically direct and
development of system because Management Information System is
management oriented. Management should decided that information
is required and hence help in designing MIS.
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 10) Common Database :
 Since MIS is an integrative system, it has the opportunity to avoid
duplication and redundancy in data collection, storage and sharing.
One master file should be maintained , which can then use be
different function areas from their respective report preparation and
analysis.

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Logical Foundations of MIS

 The logical foundations of Management Information Systems (MIS)

encompass the fundamental concepts and principles that underpin
the design, development, and operation of information systems for
supporting managerial decision-making and organizational
processes.

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 Definition of MIS:

• MIS is a field that focuses on the use of information technology

and systems to assist organizations in planning, controlling, and
making decisions.
 Role of MIS:

• MIS plays a critical role in collecting, processing, storing, and

distributing information to support managerial functions.
• It helps in turning raw data into meaningful information for
decision-makers at various levels of an organization.
 Data vs. Information:

• Data refers to raw facts and figures, whereas information is data

that has been processed, organized, and given context, making it
useful for decision-making.

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 Information System Components:

• MIS typically comprises hardware, software, data, procedures, and

people. These components work together to process and manage
information.
 Information Processing Cycle:

• The information processing cycle consists of input, processing,

output, and feedback. Data is collected, processed, and then
disseminated as output, with feedback mechanisms to enhance
the system's effectiveness.
 Decision Support:

• MIS provides decision support systems (DSS) and executive

support systems (ESS) to assist managers in making both
structured and unstructured decisions.

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 Data Modeling:

• Data modeling involves designing the structure of databases to

ensure efficient storage, retrieval, and manipulation of data.
 Database Management Systems (DBMS):

• DBMS software is used to manage data efficiently, ensuring data

integrity, security, and accessibility.
 Business Processes:

• MIS helps streamline and optimize business processes, leading to

improved efficiency and effectiveness.
 Information Security:

• Ensuring the confidentiality, integrity, and availability of data is a

critical aspect of MIS. Security measures and policies are
implemented to protect data from unauthorized access.

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DSS – Definition and Introduction

 Decision support systems (DSS) are interactive software-based

systems intended to help managers in decision-making by accessing
large volumes of information generated from various related
information systems involved in organizational business processes,
such as office automation system, transaction processing system,
etc.
 DSS uses the summary information, exceptions, patterns, and trends
using the analytical models. A decision support system helps in
decision-making but does not necessarily give a decision itself.
 The decision makers compile useful information from raw data,
documents, personal knowledge, and/or business models to identify
and solve problems and make decisions.

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 A Decision Support System (DSS) is a computer-based information system that
provides interactive support to decision-makers in organizations. It assists individuals
and groups in making informed decisions by offering a range of tools and features,
including data analysis, modeling, and access to relevant information.
 A DSS is designed to help users explore and evaluate options, analyze data, and
ultimately make well-informed choices in both routine and complex decision-making
scenarios.

 Definitions
 Herbert A. Simon:
• "A decision support system is an interactive computer-based system or subsystem
intended to help decision makers use communications technologies, data,
documents, knowledge, and/or models to identify and solve problems, complete
decision process tasks, and make decisions."
 G. B. Davis:
• "A Decision Support System is a computer-based information system that supports
business or organizational decision-making activities."

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Benefits of DSS
 Improves efficiency and speed of decision-making activities.
 Increases the control, competitiveness and capability of futuristic
decision-making of the organization.
 Facilitates interpersonal communication.
 Encourages learning or training.
 Since it is mostly used in non-programmed decisions, it reveals new
approaches and sets up new evidences for an unusual decision.
 Helps automate managerial processes.

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DSS Evaluation

 1. Objective Setting:
• Begin by defining clear and specific objectives for the DSS
evaluation. What are the expected outcomes, and what decisions or
processes should the DSS support or improve?
 2. User Feedback:
• Gather feedback from users who regularly interact with the
DSS. Their insights and experiences can provide valuable
information about its usability and effectiveness.
 3. Performance Metrics:
• Define key performance indicators (KPIs) that are relevant to
the DSS's goals. These may include factors like response time,
accuracy, user adoption, and decision quality.
 4. Data Quality:
• Assess the quality and reliability of the data used by the DSS.
Ensure that the data sources are accurate, up-to-date, and
consistent.
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 5. Functionality Testing:
• Evaluate the functionality of the DSS, including its data
retrieval, analysis, reporting, and modeling capabilities. Verify that it
performs as expected.
 6. Usability:
• Assess the user interface and overall usability of the DSS. Is it
intuitive, and does it meet the needs of the end-users? Usability
testing and surveys can help gather this information.
 7. Security and Privacy:
• Examine the security measures in place to protect sensitive
data within the DSS. Ensure that it complies with data privacy
regulations and internal security standards.
 8. Scalability and Adaptability:
• Consider whether the DSS can scale to handle increased data
volumes and user loads. Assess its ability to adapt to changing
business needs and technological advancements.
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 Cost-Benefit Analysis:
 Perform a cost-benefit analysis to determine whether the DSS
provides value for the investment. Compare the costs of
implementing and maintaining the system with the benefits it delivers.

 Decision-Making Impact:
 Evaluate the impact of the DSS on actual decision-making within the
organization. Does it lead to more informed, efficient, and effective
decision-making processes?

 Feedback Loops:
 Implement feedback mechanisms to continuously gather insights and
recommendations from users and stakeholders. Use this feedback for
ongoing improvements.

 Documentation and Training:

 Ensure that the DSS is well-documented, and users have access to
training materials and resources to maximize its potential.
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DSS Model Management

 Model management in a Decision Support System (DSS) refers to

the process of creating, maintaining, and utilizing various models and
algorithms to support decision-making. Models are essential
components of many DSS, and managing them effectively is critical
to ensuring that the system provides accurate and valuable decision
support.

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 Model Development:
 Model management begins with the development of mathematical,
statistical, or computational models that represent various aspects of
the decision-making process. These models can include forecasting
models, optimization models, simulation models, and more.
 Model Repository:
 DSS often maintain a repository or database where models are
stored, organized, and version-controlled. This repository helps keep
track of different models and their variations.
 Model Selection:
 Depending on the specific decision scenario, the DSS selects the
most appropriate model from the repository. Model selection is based
on the type of decision, data availability, and user preferences.

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 Model Calibration and Validation:
 Models need to be calibrated and validated to ensure their accuracy
and reliability. This involves adjusting model parameters and
validating the model's performance against historical data or real-
world outcomes.
 Model Execution:
 When a decision needs to be made, the selected model is executed
within the DSS. It processes relevant data and provides output, which
may include forecasts, scenarios, or recommendations.
 Data Integration:
 Model management also involves integrating the model with relevant
data sources. Data must be fed into the model to generate
meaningful results. This integration ensures that the model operates
on up-to-date information.

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 Model Monitoring:
 DSS may continuously monitor the performance of models. If a
model's accuracy or relevance degrades over time, the DSS can
trigger an update or alert the user.
 Model Version Control:
 Keeping track of different versions of models is crucial. This helps in
maintaining a historical record of changes and understanding the
reasons behind specific modeling choices.
 Model Maintenance:
 Models are not static; they may require updates to reflect changes in
the environment, data, or business processes. Model management
includes a mechanism for maintaining and improving models over
time.

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 User Interaction:
 DSS users often interact with models through a user-friendly
interface. They can provide input, adjust model parameters, and
interpret the model's outputs.
 Sensitivity Analysis:
 Sensitivity analysis is a crucial aspect of model management. It helps
users understand how changes in input variables impact the model's
output, providing insights into the decision's robustness.
 Documentation:
 Comprehensive documentation of models and their usage is vital.
This documentation includes model descriptions, assumptions,
limitations, and instructions for users.

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DSS Generators

 DSS (Decision Support System) Generators are software tools or

platforms that facilitate the development, customization, and
deployment of DSS applications. They are designed to streamline the
process of creating decision support systems, making it more efficient
and accessible.
 DSS Generators are software solutions that help users create DSS
applications without extensive programming or development skills.
They provide a framework for designing, modeling, and deploying
decision support systems.
 DSS Generators typically offer a range of features, including data
integration, model development, user interface design, reporting
capabilities, and tools for customization.

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 These generators often have user-friendly graphical interfaces that
allow non-technical users to design and configure DSS applications.
This makes DSS development accessible to a broader audience.
 DSS Generators facilitate the integration of data from various
sources, such as databases, spreadsheets, and external data feeds.
This data integration is essential for providing relevant information for
decision-making.
 DSS Generators may include modeling tools for creating forecasting,
optimization, and simulation models. Users can define and customize
models to suit their specific decision needs.
 They offer tools for generating reports, charts, and visualizations that
present data and analysis results in a comprehensible format. This
helps users interpret and communicate the information effectively.

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 DSS Generators often allow users to customize the DSS application
to match their organization's unique requirements and preferences.
This can include designing specific dashboards, adding custom data
fields, or modifying decision algorithms.
 DSS Generators are accessible from various devices and platforms,
enabling users to access decision support systems remotely and on a
range of devices.
 They may offer integration with other systems and data sources, such
as ERP (Enterprise Resource Planning) systems, CRM (Customer
Relationship Management) software, and external APIs, to enhance
the scope of data accessible for decision support.
 DSS Generators often provide user training and documentation to
assist users in effectively utilizing the platform to develop and
maintain DSS applications.

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 DSS Generators can potentially save organizations time and money
in DSS development by reducing the need for extensive custom
coding and development efforts.
 DSS Generators typically include features for data security and
compliance, ensuring that sensitive data is protected and that the
DSS complies with relevant regulations.

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Multi-criteria Modelling

 For any doubts you can ask me in the lecture or email me at

- [email protected]
(WRITE A FORMAL EMAIL)

THANK YOU !

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