Session 1-2
Dr. Manojit Chattopadhyay
Associate Professor
Outline
What is an Information System
Role of MIS in Business
MIS-Business Relationship
MIS in an Organization
The Right Mindset for Managing IT
Conclusion
What is an Information System?
Definition
InformationSystem: A set of interrelated components that
collect (or retrieve), process store, and distribute
information to support decision making and control in an
organization.
Information
Technology: All hardware and software that a
firm needs to use in order to achieve its business
objectives
Hardware: Computer machines, storage devices, mobile devices
Software: Operating systems, application software etc.
What is an Information System?
Data Vs Information
Data Vs Information
Data are streams of raw facts
Information is data shaped into meaningful form
Input Process Output
A Framework for Information Sytems
Operational Systems (primary concern is to collect,
validate, record transactional data describing the acquisition
or disbursement of corporate resources) e.g., payroll system
Characteristics are:
Repetitiveness, predictability, emphasis on past, detailed
nature, internal, structured form, great accuracy
Tactical Systems (provide middle level managers with the
information they need to monitor and control operations and
to allocate their resources effectively. In this system
transaction data is summarised, aggregated or analysed and
generate a number of reports)
Following are the types of reports:
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A Framework for Information Sytems
Following are the types of reports:
Summary reports (weekly sales by month by each
product), Exception report (warn managers when results
do not meet a standard e.g. list of all plants having more
overtime than in a week), ad hoc report (managers need
usually quickly that may never be required again,
presents information that managers use for specific
solution, managers may ask for such report when
exception occurs)
The tactical and operation IS differ in that the purpose of
tactical IS is not to support execution of operational task
but to help managers controlling these operations.
Thus the characteristics are:
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A Framework for Information Sytems
Thus the characteristics are:
Periodic in nature, unexpected findings, comparative nature,
summary form, both internal and external sources
Strategic Planning Systems (are designed to provide top
managers with information that assist them in making
long range planning decisions.). The difference between
tactical and strategic system is not always clear because
both of them may use same data.
The characteristics are:
ad hoc basis, unexpected information, predictive nature,
summary form, external data, unstructured format,
subjectivity
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A comparison of IS in operational, tactical and
strategic planning systems
Characteristics Operational Tactical Strategic planning
Frequency Regular, repetitive Mostly regular Often ad hoc
Dependability of Expected results Some surprise may Results often contained
results occur surprise
Time period overhead The past Comparative Predictive of the future
Level of detail Very detailed Summarises of data Summarises of data
Source of data Internal Internal and Mostly external
external
Nature of data Highly structured Some unstructured Highly unstructured
Accuracy Highly accurate Some subjective Highly subjective data
data data
Typical user First line supervisor Middle managers Top management
Level of decision Task oriented Oriented toward Goal oriented
control and
resource allocation
A MIS is:
• Integrated user-machine system
• For providing information
• To support the operation,management, analysis and
decision making functions
• In an organisation
This system utilises
• Computer h/w & s/w
• Manual procedures
• Models for analysis, planning, control and decisions
making &
• A database
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Quality of Information:
Timeliness, accuracy,
relevance,(Whs), adequacy,
completeness, explicit exception
based
Utility Approach:
Form: form vs requirement
Time: in time value
Place: access/deliver
Possession: owner influence
MIS as evolving concept
MIS is envisioned as a single, highly integrated system
bringing together processing of all the functions.
Itis also designed CBIS to support management planning and
decision making functions like strategic plan.
Highly integrated system is difficult to implement
MIS is now considered as federation of sub system developed
& implemented as needed but conforming to overall plan,
standard and procedures for MIS
Thus instead of single global MIS an organisation may have
many related IS that served managerial need in various ways.
MIS still continues to evolve
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Role of MIS in Business
How information systems are transforming business
Increase in wireless technology use, Web sites
Shifts in media and advertising
New security and accounting laws ITC
e-Choupal
Globalization opportunities
Internet has drastically reduced costs of operating on global scale
Presents both challenges and opportunities
UPS
Emergence of Digital Organizations
Significant business relationships are digitally enabled and mediated
Core business processes are accomplished through digital networks
Key corporate assets are managed digitally
Digital firms offer greater flexibility in organization and
management (Time shifting, space shifting)
India ranks 91 on the Networked Readiness Index (NRI) 2016, a key
component of the World Economic Forum’s The Global Information
Technology Report 2016.
The report assesses the state of networked readiness of 139 economies
using the NRI and examines the role of information and communication
technologies (ICTs) in driving innovation.
The NRI is thus a key tool in assessing a country’s preparedness to reap
the benefits of emerging technologies and capitalize on the opportunities
presented by the digital transformation.
Role of MIS in Business
Smart Phones Changing the Shape of Businesses
Increased web-presence
Online transactions and purchases
Fast supply chains (Push to demand pull)
Hear my voice, please (Blogging and Voicing)
Online campaigning and Canvassing (Anna’s Threat)
New ways of advertising through social media
Online marketplaces (www.metaljunction.com)
MIS-Business Relationship
Interdependence between organizations and information technology
In contemporary systems there is a growing interdependence between a firm’s information
systems and its business capabilities. Changes in strategy, rules, and business processes
increasingly require changes in hardware, software, databases, and telecommunications. Often,
what the organization would like to do depends on what its systems will permit it to do.
MIS-Business Relationship
Operational
excellence
New products,
Survival services, and
business models
MIS and
Business
Customer and
Competitive supplier
advantage intimacy
Improved
decision making
MIS-Business Relationship
Operational excellence:
Improvement of efficiency to attain higher profitability
Information systems, technology an important tool in achieving
greater efficiency and productivity
Wal-Mart’s Retail Link system links suppliers to stores for superior
replenishment system
New products, services, and business models:
Business model: describes how company produces, delivers, and
sells product or service to create wealth
Information systems and technology a major enabling tool for new
products, services, business models
Examples: Apple’s iPod, iTunes, and iPhone, Netflix’s Internet-
based DVD rentals
MIS-Business Relationship
Customer and supplier intimacy:
Serving customers well leads to customers returning, which raises
revenues and profits
Example: High-end hotels that use computers to track customer
preferences and use to monitor and customize environment
Intimacy with suppliers allows them to provide vital inputs, which
lowers costs
Example: J.C. Penney’s information system which links sales
records to contract manufacturer
MIS-Business Relationship
Improved decision making
Without accurate information:
Managers must use forecasts, best guesses, luck
Leads to:
Overproduction, underproduction of goods and services
Misallocation of resources
Poor response times
Poor outcomes raise costs, lose customers
Example: Verizon’s Web-based digital dashboard to provide
managers with real-time data on customer complaints, network
performance, line outages, etc.
MIS-Business Relationship
Competitive advantage
Delivering better performance
Charging less for superior products
Responding to customers and suppliers in real time
Example: Toyota and TPS (Toyota Production System) enjoy a
considerable advantage over competitors – information systems are critical
to the implementation of TPS
Survival
Information technologies as necessity of business
May be:
Industry-level changes, e.g. Citibank’s introduction of ATMs
Governmental regulations requiring record-keeping
Examples: Toxic Substances Control Act, Sarbanes-Oxley Act
MIS in an Organization
Infrastructure (IT
Hardware, Network
components)
IT
Data (Text,
Organization
(People that MIS Audio, Video
and Images)
use IT)
Each element of the IT
framework is vital for
Applications generating market-viable
(Computer products and services
Programs and
Other software)
MIS in an Organization
Functions
An information system
contains information about
an organization and its
surrounding environment.
Three basic activities—input,
processing, and output—
produce the information
organizations need.
Feedback is output returned
to appropriate people or
activities in the organization
to evaluate and refine the
input. Environmental actors,
such as customers, suppliers,
competitors, stockholders,
and regulatory agencies,
interact with the organization
and its information systems.
MIS in an Organization
Dimensions
Computer Hardware
Computer Software
Data Management
Technology
Networking and
Communications Technology
Formulate Create new
Scanning Decision Recreate
Action products
Environment Making organization
Plans and services
The Right Mindset for Managing IT
Usual complaints about IT in US / Europe
IT Investments are unrelated to Business
Payoff from IT Investments is inadequate
There too much ‘technology for technology’s sake’
Relations between IT users and IT specialists are poor
Systems designers do not consider users’ preferences and habits
The Right Mindset for Managing IT
Why is there such Confusion?
On the one hand, managers insist on elevating IT to the
level of strategy; on the other, they recognize that
integrating IT with business goals is only marginally
easier than reaching the summit of Everest. It can be
done, but it’s difficult – and the cost of failure is high.
The Right Mindset for Managing IT
Why is there such Confusion?
People think that IT Well, it doesn’t.
needs special tools, Technology should
special strategies, be managed –
and a special controlled, even –
mindset. like any other
competitive weapon
in a manager’s
arsenal
The Right Mindset for Managing IT
Japanese Vs Western Outlook
Issue Western Framing Japanese Framing
How to decide on what Strategic Alignment – Develop IT Strategic Instinct – Org. goals drive
is our business needs? that aligns with business strategy IT investment
How to know whether Value for Money – Capital budgeting Performance Improvement –
IT investment is process to manage and evaluate IT Judgment is based on operational
worthwhile? investments performance improvement
When trying to Technology Solutions – Assuming Appropriate Technology – Identify
improve a business that technology offers the smartest a performance goal and select
process, how does and cheapest way to improve technology that help achieve it in a
technology fit into our performance way that supports the people doing
thinking? the work
How should IT users IS user relations – We teach Organizational bonding –
and IT specialists specialists about business goals and Encourage integration by rotating
connect in our org.? develop technically adept, business manages through IT function,
savvy CIOs. colocating specialists and users.
How to design systems Systems Design – We design the Human Design – Design the system
that improves org. most technically elegant system to make use of the tacit and explicit
performance? possible and ask employees to adapt knowledge that employees already
to it possess
The Right Mindset for Managing IT
Sometimes the most advanced form of IT makes sense;
sometimes simpler forms will do. Sometimes high tech
should cohabit with low tech.
Theintegration between IT function and IT users should be
from top to bottom and systemic and not structural
The bridges will collapse as long as there is one IT culture and another
business culture.
Principle of organizational bonding will keep them strong and stable.
The role of culture in business practices cannot be ruled out
and therefore, it is better to focus on best principles rather
than best practices or benchmarking. Companies must learn
to adapt best principles to their business culture.
Conclusion
MIS is not just about technology, but it encompasses
people, culture, the organization and business practices.
MIS and Business should complement each other.
ITshould not be seen as a panacea. It should be inducted
into a company according to the need of the business.
Japanese way of managing IT provides and excellent
foundation for implementing IT in an organization.
Videocase
UPS 1.21:..\Video Case\UPS Package Flow Technology—DIAD.mp4
UPS 3.21:..\Video Case\UPS’s Next-Generation Mobile Devices Are
Here.mp4
UPS 4.58:..\Video Case\UPS Tour—That’s UPS.mp4
Walmart: 7.13 ..\Video Case\Walmart’s Retail Link Supply Chain.mp4
Sanfrancisco CRM: ..\..\PGP2_2014\MIS2015-17 Lecture
Notes\VideoCasesMIS\L3Case2SFGTV Customer Relationship
Management CRM San Francisco.mp4
GE 10.49:..\Video Case\GE’s Jeff Immelt on digitizing in the industrial
space McKinsey.mp4
