INFORMATION-Concepts module-1 Information is a resource like materials and money. Information is vital for survival of busi.firm INFORMATION is Processed data It has a form It is meaningful to the recipient It has a “surprise” value and It is useful in current or prospective decisions or actions

Difference between Data & Info. Dependent to users Independent of user Finished form Row form properly arranged, organized Disorganized & disintegrated refers to those which are needed Refers to details about any event Information Data Eg- Data ------ all the contents in the web Information ------ those we are interested in

Transformation of data into info. DATA STORAGE INFORMATION DATA PROCESSING Data consists of facts and figures that are relatively meaningless to the user. (e.g., number of hours worked by an employee) Information is processed data or meaningful data. (e.g., multiplying the hours worked by the hourly rate to get each employee’s gross earnings)

Steps in data processing Identifying the data Designing forms Entering data Validation Storage Processing the data Generating reports

Identifying the data Accuracy of information depends on accurate data input Locate data sources for information Accurate, adequate, relevant data must be used as input

Designing forms Design form for data entry The forms are linked to database so that it becomes very easy to enter data in to the system

Entering data Actual data must be keyed in to the form Data entry personal will do this job Work has to be done very carefully to avoid any incorrect data

Validation Certain validation process may be built in to the code so that input form do not accept any incorrect data

Storage Store the data in appropriate database to facilitate easy retrieval of data Should take care of security

Processing the data Retrieve the appropriate data for information required & process it The operations to be performed depends on the nature f the data & the information required

Generating the report Each user may want the information in a particular format Applications must be developed to generate report for users Reports must be presented in a form of print out, on screen display etc

Features of information It adds to a representation It corrects or confirm previous information It has surprise element or new value It reduce uncertainty It has value in decision making It is reusable

Dimensions of information Information has many dimensions of interest to the information system people Economic dimension Business dimension Technical dimension

Economic dimension It include both the cost of information and its benefits from use

Business dimension The characteristics of information required by managers at different level of hierarchy are different The characteristics of information for top management are in strictly contrast with those of operating level management The characteristics of information for the middle management lie somewhere between two

Technical dimension It depends on the quality & reliability of technology used for data processing & information communication Also concerned with the database The technical consideration of database are its capacity , response time security validity etc

Types of Information Based on who uses it & what impact its used produce in the organization Strategic information Tactical information Operational information Based on the source of information External Internal Based on its flow within an organization Horizontal vertical

Strategic information Required for long term planning by the top managers Eg: Information about the population changes, natural resources, new technologies

Tactical information Required for short term planning by the middle level managers Eg: sales analysis & forecasts, cash flow projections

Operational information Relates to very short period that may be a few hours to a few weeks It may be about current stock levels of inventory, work schedule for the next shift etc

Internal vs. external information Information generated through the internal sources of the organization is called internal information E.g various information flows through out the organization Information generated through outside sources of organization is called external information E.g. govt reports, industry surveys, market researches, competitor information etc…

Horizontal & vertical Information flowing up or down the organization hierarchy is called vertical information Eg: orders, decisions from higher level and reports originating from the lower level When information flows peer to peer at the same level , then it is called horizontal or lateral Eg: information flows between marketing managers, finance managers etc

OPERATIONAL MANAGEMENT OPERATIONAL MANAGEMENT OPERATIONAL MANAGEMENT EXTERNAL LOW TOP MGMT TOP MGMT TOP MGMT MIDDLE MANAGEMENT MIDDLE MANAGEMENT MIDDLE MANAGEMENT SOURCE OF INFORMATION STRUCTURE OF INFORMATION OPERATIONAL MANAGEMENT OPERATIONAL MANAGEMENT OPERATIONAL MANAGEMENT INTERNAL HIGH

Features/ qualities of information Timeliness Accuracy Relevance Adequacy Completeness Explicitness

Timeliness Information must reach the recipient within the prescribed time frame(at the right time). “Information delayed is information denied” Delays affects the decision –making process adversely Accuracy Information must be free from errors and clear in its meaning. Accuracy means information is free from bias. Wrong information may result into wrong decisions in the business.

Relevance Adequacy Completeness Information is said to be relevant if it answers specifically for the recipient what, why, where, when, who etc…… Information served should be capable of satisfying all the needs of the recipient to take appropriate decisions Adequacy The information should be of sufficient quantity covering all the related aspect of the situation or event. Completeness The information should be complete and should all the needs

Explicitness Information is said to be good quality if it does not require further analysis by the recipient for decision-making. It help the managers to use the information readily without wasting their time by re-analyzing it for decision –making

INFORMATION OVERLOAD Human capacity to accept inputs from environment is limited. Information overload is a state when user is presented too much information in front It will be impossible to find out which information is relevant to the problem context Overload causes a barrier to understanding the information presented and confuses the user

Information overload is avoided using the following techniques Overload affects adversely, the decision-making process and it may lead to wrong decisions. Information overload is avoided using the following techniques Summarizing Filtering Message routing Message Inference

Summarizing Summarizing is a technique that reduces the amount of data without changing/loosing the essential of the original information. E.g. summary reports (monthly sales reports of a product, annual financial statement) The information is get summarized as they move up in the organizational levels The level of summarization is dependent on the organizational level of the decision-maker E.g. the top level (president) may need only the total sales of a product. But the area sales manager need sales by each sales representative Summarization helps to reduce the amount of information that is reaching the users of the organization

Message Routing Routing the message to only those users who require them for some action or decision The information is reported to the needed individuals or functional departments only E.g. the information regarding the purchase order is given to only those departments (production, distribution, billing etc..) which take direct actions to the order

Filtering Filtering is the process of truncating the information content, by deleting the irrelevant part of it. TOP LEVEL FILTERED MIDDLE LEVEL FILTERED LOWER LEVEL ACTIONS EVENTS COMPLAINTS

Information Systems An Information System (IS) collects, stores and processes data to provide useful, accurate and timely information – typically within the context of an organization. Info web: IS case study

Information Systems Support Strategic Planning (long-range goals) Tactical Planning (short-range goals) Operational Planning (day-to-day activities)

IS Major Functions Help people in organizations make decisions in response to problems Decision-making process has 4 phases Recognize a problem Devise/analyze possible solutions or actions to solve the problem Select an action or a solution Implement the solution

Information Systems Can Collect Internal Information External Information

Components of IS

IS Categories Office Automation System Transaction Processing System Decision Support System Executive Information System Expert System Neural Network System

Office Automation System OAS Office Automation System Computerizes routine office tasks Word processing Spreadsheets Scheduling Database E-mail Uses LANs, intranets and the Internet

Transaction Processing System TPS Transaction Processing System Transaction is an exchange of goods, services or funds Collect Process Store Display Modify Cancel Online Transaction Processing (OLTP) CD screentour: transaction processing system

Decision Support System DSS Decision Support System Directly manipulates data Analyzes external data Generates statistical projections Creates data models of various scenarios CD screentour: DSS Info web: DSS

Executive Information System EIS Executive Information System A type of DSS For senior managers For strategic management activities Setting policies Planning Preparing budgets

Expert System ES Also called Knowledge-Based System Analyzes data and produces a recommendation based on the knowledge of a specialist CD screentour: expert system Info web: expert system and neural network

Management Information System (MIS) An MIS provides managers with information and support for effective decision making, and provides feedback on daily operations. MIS provides information to the users in the form of reports Output, or reports, are usually generated through accumulation of transaction processing data. MIS is an integrated collection of subsystems, which are typically organized along functional lines within an organization.

Management Information System MIS Management Information System Creates reports managers can use to make routine business decisions Scheduled reports Key-indicator reports Exception reports Ad hoc (demand) reports Drill-down reports CD screentour: MIS

Definition of MIS A management information system is MIS is a man-machine system that produces information for use in managerial problem-solving and decision-making. A management information system is An integrated user-machine system For providing information To support the operations, management, analysis, and decision-making functions The system utilizes Computer hardware and software Manual procedures Models for analysis, planning, control, and decision making, and A database Gorden B. Davis

Other Definitions……. MIS is a system for producing and delivering timely information that will support management in accomplishing its specific task in enterprise (Robert & George) MIS is an information system that facilitates management by producing structured, summarized reports on regular basis (john & Garg) MIS can also be called as Information Reporting system that provides reports to support management decision-making (James A O’Brien)

Outputs of a Management Information System Scheduled Reports Produced periodically, or on a schedule (daily, weekly, monthly).

Key-Indicator Report Summarizes the previous day’s critical activities and typically available at the beginning of each day.

Demand Report Gives certain information at a manager’s request. Exception Report Automatically produced when a situation is unusual or requires management action.

Drill Down Reports Provide detailed data about a situation.

Framework / Model of MIS Environment Organizational problem solvers Report writing software Mathematical Models Environment Environment Database DATA MIS INFO. Environment

Components of MIS Data to be arranged Classify, sort, summarize, calculate Information/ report Inputs Sales in units by each sales man over a period Estimated sales in units of competitor Economic conditions an trends Outputs Sales by product Sales by salesman Sales by region Sales by trend analysis Sales forecasts