Week 5 Management Information Systems by Alper Özpınar

Information Management and Decision Making

What is Management Management is the process of planning, organizing, leading, and controlling the resources of an organization in order to achieve stated goals.

Who are the Managers  Persons who are appointed to position of authority  Persons who enable others to do their work effectively  Persons who are responsible for resource utilization  Persons who are accountable for work results

Classification of Managers  By level in the organization: senior, middle, or first line  By overall nature of the position: policy, human resources (HR), operations,..  By extent of use of certain skills (e.g., )  By nature of activities

What Managers Do (1) 1. Assume responsibility 2. Balance completing goals (prioritize) 3. Think conceptually 4. Work through or with other people 5. Act as mediators, serving as arbitors and judges

What Mangers Do (2) 6. Are politicians - building alliances, coalitions, and mutual obligations - using persuasion and compromise to achieve organizational goals 7. Represent their work unit and organization 8. Make difficult decisions

Classical Model of Management  Composed of interrelated social and technical functions and activities  Multiple ongoing functions involved: - Planning - Directing - Organizing- Controlling - Staffing- Decision-making

Behavioral Model of Management  Descriptions of management based on behavioral scientist’s observations of what managers actually do in their jobs  Studies show that managers engage in more than 600 different activities  Less systematic  More informal  Less reflective  More reactive

Behavioral Model of Management  High volume, high speed work  Varietyi fragmentation, brevity  Issue preference current, ad hoc, specific  Less attention to historical, routine information  Complex web of interactions, cantacts  Strong preference for verbal media  Control of the agenda

ROLE OF MANAGERS (Mintzberg)  INTERPERSONAL ROLES  INFORMATIONAL ROLES  DECISIONAL ROLES

Interpersonal Roles  Figurehead : Managers act as figureheads for the organization when they represent their company to oıtside world and perform symbolic duties such as employee awards  Leader : Act as leaders attempting to motivate counsel and support subordinates  Liaison : Act as liaison among the members of management team >>Electronic Communication Systems

Informational Roles  Act as Nerve centers : Receive concrete, most up to date information and distribute information  MIS  Disseminator :  , Office Automation Systems (OAS)  Spokesperson  OAS

Decisional Roles  Makes decisions  Entrepreneur  Disturbance handler  Resource allocator  Decision support systems (DSS)  Negotiator

What Managers Decide - Wrapp  Good managers do not make swweping policy decisions but istead give the organization a general sense of direction and become skilled in developing opportunities.  Succesfull managers spend much time and energy getting involved in operational decisions and problems in order to stay well informed

Wrapp’s SUCCESSFUL MANAGER: OPERATING PROBLEMS GENERAL MANAGER OPERATING DECISIONS CORPORATE STRATEGY According to Wrapp, succesfull managers are high involved in operating problems and decisions. Since corporate strategy derives from operating problems ; corporate strategy tends to not to be systematic or comprehensive but instead is an outgrowth of day to day operating decisions

LEVELS OF DECISION MAKING  STRATEGIC: Long-term objectives; resources; policies  MANAGEMENT CONTROL: Monitor use of resources; performance  KNOWLEDGE-BASED: Evaluate potential innovations; knowledge  OPERATIONAL: How to carry out specific day-to-day tasks

TYPES OF DECISIONS  STRUCTURED: Repetitive; routine; definite procedure; certainty for handling them  SEMISTRUCTURED: One or more factors not structured; only a part of the problem has a clear-cut answer provided by an accepted procedure  UNSTRUCTURED: Unique; non-routine; uncertainty; requires evaluation,judgment. No agreed-upon procedure for making such decisions

INFO SYSTEMS, LEVELS, DECISIONS TPS OAS MIS KWS DSS ESS ORGANIZATIONAL LEVEL TYPE OF DECISIONOPERATIONALKNOWLEDGEMANAGEMENTSTRATEGIC STRUCTURED ACCOUNTS RECEIVABLE ELECTRONIC PRODUCTION SCHEDULING COST OVERRUNS SEMI-BUDGET STRUCTUREDPREPARATION PROJECT SCHEDULING FACILITY LOCATION UNSTRUCTUREDPRODUCT DESIGN NEW PRODUCTS NEW MARKETS

ORGANIZATIONAL STAGES OF DECISION MAKING  INTELLIGENCE: Collect information; identify problem >>MIS  DESIGN: Conceive alternatives; select criteria >> DSS, KWS SOURCE: Simon, The New Science of Management Decision (1960)

ORGANIZATIONAL STAGES OF DECISION MAKING  CHOICE: Use criteria to evaluate alternatives; select, what if simulation >>DSS large models  IMPLEMENTATION: Put decision into effect; allocate resources; control >> Microcomputers SOURCE: Simon, The New Science of Management Decision (1960)

 RATIONAL MODEL: Model of human behavior based on the belief that people, organizations and nations engage in basically consistent, value maximizing calculations or adaptations within certain constraints. Comprehensive rationality; evaluate all alternatives and choose the best alternative INDIVIDUAL MODELS OF DECISION MAKING

 SATISFICING-BOUNDED RATIONALITY MODEL: Choose the first available alternative in order to move closer toward the ultimate goal instead of searching for all alternatives and consequences.  Bounded rationality idea that people will avoid new uncertain alternatives and stick with tried-and true rules and procedures INDIVIDUAL MODELS OF DECISION MAKING

 MUDDLING MODEL: Method of decision making involving successive limited comparisons where the test of a good decision is whether people agree on it; marginal changes.  Examine alternatives to establish a mix of goals consequences  Choices are not “made”, final decisions are always being modified to accommodate changin objectives, environments, value preferences INDIVIDUAL MODELS OF DECISION MAKING

 PSYCHOLOGICAL MODEL: Human being are value maxizers  Systematic decision makers approach problem by structuring it in terms of some formal form  Intuitive decision makers approach problem with multiple methods in an unstructured manner, using trial and error to find a solution INDIVIDUAL MODELS OF DECISION MAKING

 RATIONAL ACTOR:, examine all alternatives and consequences and then choose a policy that maximize organization’s benefits, the goal or preference function  BUREAUCRATIC: Follow standard operating procedures (SOP) ORGANIZATIONAL MODELS OF DECISION MAKING

 POLITICAL: Key groups compete and bargain, key players are involved in a game of influence, bargaining and power.Organizational outcomes are determined by the beliefs of players, their skills in playing the game, resources they bring to bear, and the limits on theri attention and power ORGANIZATIONAL MODELS OF DECISION MAKING

 “GARBAGE CAN”: Most Organizations are nonadaptive, temporary and disappear over time. Organizational decisions result from interactions among the stream of problems, potential actions, participants and chance. ORGANIZATIONAL MODELS OF DECISION MAKING