Management Information System - MIS by Ashish Ukidve M.E, CSSLP, CISA ( USA) ISO LA

MIS in today’s environment Today MIS must be seen w.r.t. IT systems as all business is done thru IT Today MIS must be seen w.r.t. IT systems as all business is done thru IT Data when processed gives Information Data when processed gives Information It is useful for managing data or information It is useful for managing data or information For understanding MIS we have to understand Information Systems and how they are developed or acquired For understanding MIS we have to understand Information Systems and how they are developed or acquired

Management ( &) Information Systems Management essentials & Levels of management Management essentials & Levels of management What do information systems do? What do information systems do? MIS as an evolving concept MIS as an evolving concept MIS and Organizational Fit MIS and Organizational Fit MIS as a Discipline MIS as a Discipline

4 Management: What is management? Management: What is management? Planning Planning Organizing Organizing Leading Leading Controlling Controlling Management essentials….

5 Planning Planning Goal setting Goal setting Environmental scanning Environmental scanning Forecasting Forecasting Data collection Data collection Management essentials….

6 Organizing Organizing Staffing Staffing Coordinating Coordinating Delegating Delegating Understanding Understanding Procedures/ Policies Procedures/ Policies Management essentials….

7 Leading Leading Authority Authority Motivating Motivating Directing: Delegation of responsibilities activating Directing: Delegation of responsibilities activating Supervising Supervising Negotiation Negotiation Persuading Persuading Due Diligence Due Diligence

8 Management essentials…. Controlling: Resources- Money (capital), manpower (people), materials, machines, movement (Distribution, flow), and Information Controlling: Resources- Money (capital), manpower (people), materials, machines, movement (Distribution, flow), and Information Measuring Measuring Evaluating Evaluating Reporting Reporting Corrective action Corrective action Feed back Feed back

9 Communicating: Goals/Objectives, standards Communicating: Goals/Objectives, standards of desirability of desirability Informing Informing Persuading Persuading Negotiation Negotiation Corrective action Corrective action Listening Listening Management essentials….

Organisational Levels Four organizational levels Four organizational levels Operational personnel Operational personnel Lower management Lower management Middle management Middle management Top management Top management Responsibilities, decision-making styles, and information system requirements vary depending on where you are positioned Responsibilities, decision-making styles, and information system requirements vary depending on where you are positioned

11 MIS Raw Material- DATA Information: What is information? Information: What is information? Raw material - DATA Raw material - DATA Stored facts Stored facts inactive (they exist) inactive (they exist) technology based technology based gathered from various places gathered from various places

12 Information: What is information? Processed data - transformed form data Processed data - transformed form data meaningful meaningful Has perceived value Has perceived value Has Surprise value Has Surprise value Has news value Has news value Presented as facts Presented as facts Domain based - business based Domain based - business based Model Model entity entity attribute attribute relationship relationship Reduces Uncertainty? Reduces Uncertainty? Provides Competitive Edge Provides Competitive Edge ……. Adds Value to business operations & decisions ……. Adds Value to business operations & decisions

13 Information: What is information? Information is data that has been processed into a form that is meaningful to the recipient (USER) and is of real or perceived value in current or prospective actions or decisions. Information is data that has been processed into a form that is meaningful to the recipient (USER) and is of real or perceived value in current or prospective actions or decisions.

14 Transforming Data Into Information Data Inputs Information Outputs Capture Manipulation Storage Provision of Access at User Location External Data Internal Data Information System Query Response Decision Outcome Expert-System Advice Transaction Document Report Organization Environment

15 Systems Concepts Definition … Definition … input-process-output an orderly arrangement of interdependent ideas or constructs (ABSTRACT SYSTEM) input-process-output an orderly arrangement of interdependent ideas or constructs (ABSTRACT SYSTEM) a set of elements which operate together to accomplish an objective a set of elements which operate together to accomplish an objective (PHYSICAL SYSTEM) (PHYSICAL SYSTEM) Network: An Integrated environment for a specific set of tasks Network: An Integrated environment for a specific set of tasks General Model of a System: Input, process and output. General Model of a System: Input, process and output. The features which define and delineate a system form its boundary. The system is inside the boundary and the environment is outside the boundary. The features which define and delineate a system form its boundary. The system is inside the boundary and the environment is outside the boundary. a system is composed of subsystems a system is composed of subsystems The interconnections and interactions between the subsystems are the INTERFACES. The interconnections and interactions between the subsystems are the INTERFACES.

16 System

17 System: Black Box or General View System Environment InputsOutputs Constraints Objectives

18 A System and its Subsystems Environment System Interconnection Subsystems (components) Constraints InputsOutputsObjectives System Boundary

19 Systems Approach Systems Approach: Systems Approach: Identify & establish the objective of the system Identify & establish the objective of the system Consider the totality of its relationships with its environment Consider the totality of its relationships with its environment Can not ignore the importance of the environment internal or external Can not ignore the importance of the environment internal or external

20 Systems Approach Identify its components and their interactions. Identify its components and their interactions. examples: examples: Human Resources Human Resources skills inventory system skills inventory system managerial promotion system managerial promotion system should they be separate or linked? should they be separate or linked? Brokerage house Brokerage house central client or central client or individual broker system individual broker system TPS that has a very long response time TPS that has a very long response time

21 Systems Approach Effectiveness: the extend to which a systems achieves its objectives Effectiveness: the extend to which a systems achieves its objectives Efficiency: consumption of inputs relative to outputs Efficiency: consumption of inputs relative to outputs Usability: the ability of the uses to use the system Usability: the ability of the uses to use the system Satisfaction: A subjective measure of "like" or usability or effectiveness Satisfaction: A subjective measure of "like" or usability or effectiveness

22 Systems Types Deterministic versus probabilistic Deterministic versus probabilistic Deterministic: The interaction between the parts or subsystems is known for certain; Deterministic: The interaction between the parts or subsystems is known for certain; example: a computer program which performs exactly to a set of instructions example: a computer program which performs exactly to a set of instructions Probabilistic: A system that can be described in terms of probable behavior (a certain degree of error); Probabilistic: A system that can be described in terms of probable behavior (a certain degree of error); examples: An inventory system, a five year old (who does not follow a certain set of instructions). examples: An inventory system, a five year old (who does not follow a certain set of instructions).

23 SYSTEM INTERDEPENDENCE BUSINESS Strategy Strategy Rules Rules Procedures Procedures ORGANIZATION INFORMATION SYSTEM INTERDEPENDENCE SOFTWARE HARDWARE DATABASE TELE- COMMUNICATION S

Information System Components Hardware – Servers, PCs, laptops, routers, UPS etc Software – Application software, system software etc Data – data associated with real life events Procedures – logic to process data to generate information People – to operate procedures either on computer or manually and also to consume the information generated

Business Information Systems Characteristics of business information systems - 4 main characteristics affect a business information system’s complexity Characteristics of business information systems - 4 main characteristics affect a business information system’s complexity Relationships with other systems Relationships with other systems Boundaries Boundaries Specialized business needs Specialized business needs Size of the company Size of the company

Information System Components Companies are classified based on their main activities: Production-oriented (industrial) companies that manufacture & sell goods Service companies that mainly offer information, services, or sell goods made by others Combined industrial & service companies

Systems Development Life Cycle Systems planning Systems analysis Systems design Systems implementation Systems operation and support

Systems Development Life Cycle… Systems planning Preliminary investigation report Systems analysis System requirements document Systems design System design specification Systems implementation Complete functioning information system Systems operation and support Operational information system

Systems Planning Purpose – identify problem’s nature/scope Systems request – begins the process & describes desired changes/improvements Systems planning – includes preliminary investigation or feasibility study End product – preliminary investigation report

Systems Analysis Purpose is to learn exactly how the current system operates Fact-finding or requirements determination is used to define all functions of the current system This is done by interviewing people, collecting and studying documents and forms handled in a company Writing down procedures along with diagrammatic representations

System Development Options Options Develop a system in-house Purchase a commercial package Outsource the development Modify an existing system Stop development The end product for this phase is the systems requirements document

Systems Design Purpose is to satisfy all documented requirements Purpose is to satisfy all documented requirements Identify all outputs, inputs, files, manual procedures, & application programs Identify all outputs, inputs, files, manual procedures, & application programs Avoid misunderstanding through manager and user involvement Avoid misunderstanding through manager and user involvement End product is system design specification consisting of End product is system design specification consisting of Tables design Tables design Screen / dialogue boxes design Screen / dialogue boxes design Report / query design Report / query design Validation rules design Validation rules design Processing logic design Processing logic design Deployment design Deployment design Others Others

Systems Implementation Construct/deliver information system Prepares functioning, documented system Write, test, document application programs User and manager approval obtained File conversion / data conversion occurs Users, managers, IS staff trained to operate and support the system Post-implementation evaluation performed

Systems operation and support New system supports business operations New system supports business operations Maintenance changes correct errors or meet requirements Maintenance changes correct errors or meet requirements Enhancements increase system capability Enhancements increase system capability After several years of operation, systems MAY need extensive changes After several years of operation, systems MAY need extensive changes Systems development life cycle ends with system replacement Systems development life cycle ends with system replacement

Today’s Indian Industry Manufacturing Manufacturing Trading Trading Banking, Finance & Insurance Banking, Finance & Insurance Service Service Agriculture & agriculture products Agriculture & agriculture products Govt Sector – Pure Govt and Govt companies Govt Sector – Pure Govt and Govt companies

Information System Applications Called as Business Applications Called as Business Applications They can be stand-alone or integrated They can be stand-alone or integrated They can be distributed or centralised They can be distributed or centralised They can be non-web-based or web-based They can be non-web-based or web-based They can be text based or GUI based They can be text based or GUI based They can be custom-built or ready-made as a product They can be custom-built or ready-made as a product

Some Business Applications Function oriented applications e.g. Purchase, inventory processing, sales & distribution systems, share accounting, banking etc Function oriented applications e.g. Purchase, inventory processing, sales & distribution systems, share accounting, banking etc Integrated systems such as ERP e.g. SAP, BaaN, JDE, Oracle Financials Integrated systems such as ERP e.g. SAP, BaaN, JDE, Oracle Financials Customer support such as Talisma Customer support such as Talisma Insurance such as Genesis Insurance such as Genesis Centralised banking such as Finacle, Flexcube etc Centralised banking such as Finacle, Flexcube etc

What a system does? A system captures data – either off-line or on-line A system captures data – either off-line or on-line This data is stored in a database This data is stored in a database The data is processed either immediately or in batch mode The data is processed either immediately or in batch mode The result of processing may be for final human consumption or fed to other application The result of processing may be for final human consumption or fed to other application The data from transaction systems (or operations systems) is uploaded in a batch mode to Data Warehouse Systems The data from transaction systems (or operations systems) is uploaded in a batch mode to Data Warehouse Systems DSS are built around Data Warehouse Systems DSS are built around Data Warehouse Systems

Purchase to Pay Cycle Get Purchase requisition from depts - system Get Purchase requisition from depts - system Collate all requisitions – semi-system Collate all requisitions – semi-system Call quotations / tenders - manual Call quotations / tenders - manual Evaluate vendors - manual Evaluate vendors - manual Select vendor - manual Select vendor - manual Prepare & place purchase order – system Prepare & place purchase order – system Delivery of goods – manual Delivery of goods – manual GRN GRN

Purchase to pay cycle… Quality control – manual Quality control – manual Approval – system Approval – system Supplier submits bill/s – system Supplier submits bill/s – system Approve bills – system Approve bills – system Prepare and pay supplier – semi-system Prepare and pay supplier – semi-system Closure of cycle Closure of cycle

Sales & distribution Inquiry - Customer makes an enquiry about a product / products Inquiry - Customer makes an enquiry about a product / products Quotation -A quotation presents the customer with a legally binding offer for delivering a product or providing a service within certain fixed conditions. This offer is legally binding for the company within a specified time period. Quotation -A quotation presents the customer with a legally binding offer for delivering a product or providing a service within certain fixed conditions. This offer is legally binding for the company within a specified time period.

Sales & distribution… Sales Order - A Sales Order consists of one or several items containing the quantity of the material or service specified for the order. The total quantity can be subdivided into schedule lines which contain different partial quantities and the relevant delivery dates. Sales Order - A Sales Order consists of one or several items containing the quantity of the material or service specified for the order. The total quantity can be subdivided into schedule lines which contain different partial quantities and the relevant delivery dates. Delivery - Sales and distribution document for processing a delivery of goods. The delivery serves as a basis for : Planning material requirements, Picking, Creating shipping documents, Creating shipping units, Transportation, Billing. Delivery - Sales and distribution document for processing a delivery of goods. The delivery serves as a basis for : Planning material requirements, Picking, Creating shipping documents, Creating shipping units, Transportation, Billing. Goods Issue - A reduction in stock on hand in the warehouse/stores Goods Issue - A reduction in stock on hand in the warehouse/stores

Sales & distribution… Billing - Creation of commercial invoice is done as intermediate document (It is required for preparation of Excise Invoice and posting into account). This is to be based on Delivery document. Billing - Creation of commercial invoice is done as intermediate document (It is required for preparation of Excise Invoice and posting into account). This is to be based on Delivery document. Excise Invoice - In order to generate an Excise Invoice number and update excise accounts, the Excise Invoice will be created with reference to the billing document, by specifying the date and the billing document number. Excise Invoice - In order to generate an Excise Invoice number and update excise accounts, the Excise Invoice will be created with reference to the billing document, by specifying the date and the billing document number.

Payment Card Process and/or Issuer Acquirer Merchant Cardholder uses card to buy from is a member of provides processing services to issues cards to may or may not be the same as

Typical system modules

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