MDBS

(Managing Digitization of Business Systems)

UNIT 1: Introduction and Overview

Shreekant Deshpande
July 2022

Mission Vision Core Values

Christ University is a nurturing ground for an Excellence and Service Faith in God | Moral Uprightness
individual’s holistic development to make effective Love of Fellow Beings | Social
contribution to the society in a dynamic environment Responsibility | Pursuit of Excellence
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Introduction and Overview – This week plan

Course Pack / Course Plan (CP) walkthrough.

Contents, Cases, Recommended book, CIAs, Rubrics

Class -1 ( Book section 1.2, 1.6)

• Information Systems vs Information Technology, Cases:

• Interaction Model for Managing Information Systems. Tata Motors (1)
Article DIKW (HBR)
Class -2 ( Book section 3.1-3.4)

• DIKW hierarchy,
• Information as a Resource,
• Information in Organisational Functions,
• Types of Information Technology.

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MDBS - Course Pack / Course Plan (CP) walkthrough

Reference Book -
De, R. (2018). Managing Information Systems in Business, Government
and Society (2nd ed.). Wiley India Pvt. Ltd

- Units
- Resources
- Text (from the reference book, Chapter/Section)
- Text Cases ( from the Reference Book, Chapter)
- Cases – 10 cases for discussion in class. Class participation counted.
- Articles
- CIAs
- Rubrics

Class Participation Marks –

- 10 Marks for class participation
- 15 Marks for Decision sheets

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Introduction and Overview

Class -1

Information Systems vs Information Technology

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Introduction

Information flow in a business transaction (Information system)

Business Process : Converts inputs into Output and adds economic value by adding utility in the
process (Form, Place and Time utility).
Outputs
Inputs Conversion
(Products/Services)

2. Flow of Material/Product, Finance and Information in an organization :

Raw Materials or components or product move from stage to stage till they are converted into
finished goods, for delivery to customers. Information facilitates this flow, at different stages in the
supply chain. Applies to products and services.
Ex:
Purchase Dept. Stores Shop Floor Dispatch
Customer
Material Receipt Material Issue Shift Report Delivery order
Information Flow

Information System - an enabler to manage business by coordinating usage of all the

resources at different stages of management across all the functional departments
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Data Vs Information

1. Student list -
Data elements: student id, name, dob, gender, mobile number,
email id, UG Degree, etc…
Information: Number of students, boys, girls, UG Degree wise, etc..

2. Invoice/Bill-
Data elements: Product name, quantity, price, GST rate,
Information: Invoice/Bill Total amount

2. Marks Card: <class discussion>

Data elements:
Information:

Data is quantified observation of a process, person or a material.

Data is collected at atomic level
Information is processed data.
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Introduction and Overview

Information Systems Vs Information Technology (IS Vs IT)

Information Systems (IS)

 Management information system is a system that enables people to gather,

consolidate, and compute data, and present the information in a meaningful and
intelligent (that makes sense to the user) format, either with the help of computers or
manually, to support decision making.

 Businesses have been using information (Manual Information system- Physical

files/records) for decision making for centuries.

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Introduction and Overview

Information Systems Vs Information Technology (IS Vs IT)

Information Systems (IS)

 CBIS: Computer based information system

 Intuition/Thumb rule based decisions Vs Informed decisions

 Information System is made up of interrelated components (computers, network,

software, people and data) that collect, retrieve, process, store, and distribute
information to support decision making, planning, coordination and control in an
organization.

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Introduction and Overview

• Information Technology (IT)

Information Technology (IT) refer to the material enablers of IS in the form of

• Hardware
• Computer
• Software
• application and
• networks
that make up the IS.

People build IS using IT and defined processes and enable managers to take
decisions by managing data/information to run the business.

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Data processing cycle in a MIS

1. Input/Data collection : Form, upload, key pad entry, interface data transfer

2. Data processing, computation : Data cleansing, Aggregation, classification, Logical

transformation, algorithmic computation
Business
Organization:
3. Output : Reports, List, Graphs, Dash boards (drill down and roll-up features) • Dispersed
• Networked
• Knowledge
4. Storage : Storing data for future use and retrieval based
• IT Enabled
5. Archiving and/or deleting : x years old data stored in another database for performance
reason, ex: 7 years data required for tax purposes, soft delete, hard delete

Examples: IRCTC, ATM, Billing app, Air ticket Reservation app, Uber, Swiggy, Adhaar,
PAN card, NGOs, etc..
• Role of MBA : Functional Analyst and Quality assurance
BookMyShow, etc.. • Needs Domain knowledge coupled with MIS knowledge

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Components of Business Information Systems

1. Hardware
2. Software
3. Data
4. People
5. Internet
 Hardware: In addition to resources like
desktops, laptops, and servers, hardware
resources cover peripherals like printers,
storage devices. Client and Server.

 Software: These applications are used for

processing the data and presenting it in
meaningful form for managerial decision
making. Software systems not only include
applications but system software, utilities,
programming languages, procedures,
Interfaces, Workflow and operating systems.
 Application software – Talley, SAP,
Excel, Word, Work flow, Interfaces,
Components of MIS
database, etc..
 System software – Windows, Unix,
Device driver, android, MAC, etc…

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Components of Business Information Systems
 Network: Play important role in the world of
1. Hardware ICT. Comprises of computers and
2. Software communication processors.
3. Data
4. People • Data: Data is the most indispensable
5. Internet component of an information system and a
valuable resource.

• People: People resources are very critical

component of any management information
system as they are instrumental in developing,
using and managing the systems. (Functional
analysts, DBA’s, Programmers, Quality
control/Testers, Project leaders, Hardware
experts, Network engineers, etc..)

Components of MIS

• MBA’s play role of Functional Analyst and

Quality managers
• Domain Knowledge coupled with MIS
knowledge

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The IT interaction model

Organizations and IS both do not remain static over time due to change in
market, technology and changes in the external environment.

Organizations need to change their products, services, internal processes and

organization structure to remain current. Management has to ensure that the IS
is updated with latest developments to remain competitive.

People also change with the evolution in technology, office processes and
appropriate IS have to be adopted by the organizations to enhance productivity
and keep people satisfied.

Close interaction exist between IS and Organization, resulting in continuous

changes through adoption of new technology and processes to facilitate new IS

Ex: IS in banks : Product centric to customer centric, Better SLAs, quicker response to
complaints, ATMs, Call centers, Cashless payments, e-business, etc..

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The IT interaction model
Competitive environment: Organizations
adopt evolving practices and IS to remain
competitive in the market.

Competitive strategy: Can be cost based or

response based strategy and adopt a
corresponding IS to meet their objectives.

Work culture: Depends on the value system

of an organization and the way in which work
is accomplished- cooperation, competitive,
transparency, delegation, team work, etc.
System Implementation process:
Involves analysis, buy/build decision, IT infrastructure: Selecting a IT that leads to
design, development, testing, training, an IS is an important decision based on
implementation and maintenance. organizational/operational readiness, technical
Change management is important to feasibility and financial viability.
get the new system/processes
accepted by the employees. .
Use & Consequences: Organizations carefully design the transition from manual to automation or
to a better system by planning change management process/training the work force to realize the
objective.

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Effects of MIDBS:
First-Order, Second-Order and Third-order effects of implementing IS

The outcome of implementing IS can be positive or negative

The consequences of implementing an IS spread over time
The immediate consequence visible in organization in the form of
• Increased speed of processing transactions or data
• Resulting higher volume of transactions
Theses are called First-Order effects (Ex: Payroll processing) .

Some effects take time to become visible and also may require some additional changes
in the organization process.
In HR dept. hiring process becomes faster
Introduction of incentive scheme to further increase volume of transactions
Automation helps to improve overall productivity and profitability

These are called Second-Order effects.(Incentive scheme)

The long term effects become visible as time passes ( 3-5 years)

Others follow IS to keep up with the trends and competition

Government has to make suitable changes in the regulations
These are called Third-order effects. (Industry wide adoption, Govt. schemes…)
Ex: Cash less transactions (PhonePe, Google Pay, e-Commerce, e-Learning, etc)
Car pooling …?

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Effects of Competition and Organization culture

Competitive environment:

It is an environment in which a firm operates and faces competition is marketing and

selling its products and service.
Majority of firms are forced to adopt new IS due to peer pressure
Objectives can be :
• Cost reduction
• Customer response
• Differentiation

Organization culture:

The organization culture is the result of shared set of values and practices in in an
organization.

Two types: Competitive and cooperative

Competitive : Firms have equal level of competition outside and inside the organization
( focused/tailor made IS)
Cooperative: Competition is mainly with outside/others players in the domain ( shared IS)

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Effects of Organizational structure:

Organizations have a defined hierarchy to facilitate easy implementation of policy,

procedure and rules ( Governance)

• Hierarchy
• Matrix
• SBU, etc..

IS components:

• Workflow
• Interfaces

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Support for Organizational processes:

• Computerization of the process

• Automating the process
• Upgrading the Process/IS – migrating to new system from Legacy system

Choosing and Implementing an Information System:

It is a challenging task to choose and implement a new IS

• In-house or Outsource the project
• Make or Buy the system/App
• Managers have to change IS based on the competition and evolving IT

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MIS Concepts

Data: Quantified observation of a process, item, person, etc..

Information: Processed data, aggregated, consolidated, etc..
Programming : Systematic process of converting a logical process to computer understandable
language. Algorithms, Logic, Languages, Coding, database, etc...
•Reports : Static reports. Monthly sales reports. Managers use reports to plan and take decisions
•Dynamic reports: What-If analysis, analyzing change in sales Vs change in price
•Dash boards : BSC (Balanced score card) based, Or Department based: HR, Marketing, Finance,
Production.
•Algorithm: Logic for data manipulation (Marks card preparation, deciding first/second class)
•Alerts : Preventive mechanism before danger level is reached
• Users : Two types – Power users and business users
• Work flow system : Automated process flow (for series of approvals) eg. Pega systems
• Interfaces : Two types – Internal and External

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DIKW hierarchy

Data : Raw facts, quantified

details of a process or an
entity

Information: Processed data

useful for decision making

Knowledge: Synthesized
with other related contextual
information over time

Wisdom: Ability to say good

or bad, Correct or wrong,
Ethical and not-ethical, to
make choice/decision with
internal and external
information

What is the rain fall- When does it rain more-which crop is suitable - what to
sow now?

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DIKW hierarchy

Data is stored in tables in terms of 0 and 1, in the form of bits and bytes.
8 bits make one byte.
Memory is measured as KB, MB, GB, TB, PB.
1 KB – 1000 bytes ( 1024 bytes)
1 MB - 1000000 bytes ( 1024*1024 bytes)
Types of memory: RAM ( Random Access memory) and ROM ( Read only Memory).

Refer to an article : The Problem with the Data-Information-Knowledge-Wisdom Hierarchy by David

Weinberger, February 02, 2010, HBR article

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Information as a Resource

Along with 4 M’s, INFORMATION is an important resource for business. Details of

customer preferences, market trend, competitors prices, raw material prices, automation
possibilities, etc…

Using information, organizations can use resources in a better way to control cost and
be more responsive to customers/market demand.

Information can be either generated in-house or it is available for a price.

Information in Organisational Functions

Functional departments (HR, Finance, Marketing, Operations/Production) use IS to run

their activities and exchange information among themselves and with external entities.

Use of MIS: (P-D-A-C) Types of MIS:

• Marketing • Sports
• Production • Politics
• CAD/CAM • Entertainment
• Transactions • Navigation ( Air, Water, Road)
• HR • Finance

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Types of Information Technology

1. IT tools used by individual users

2. IT tools for people working in groups
3. IT tools for the entire organization

There are three types of IT in an organization:

Functional/Department level: CAD, MS Word, Excel, PPT

.. For individuals to perform their task.

Network/Collaboration level: facilitate collaboration and coordination in

groups- emails, webinar meetings, documents sharing etc..

Enterprise Level: Supports activities of individuals, groups and entire

organization. Ex: Procurement, Accounts, Marketing, HR systems by using
integration . Also interact with external players like supplier, customers, etc..

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Case study:
Two types –
• Problem /Opportunity
• Success story

• Identify Symptom and Problem

• Develop the alternatives
• Recommend solution

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Case study:
Two types –
• Problem /Opportunity
• Success story

• Identify Symptom and Problem

• Develop the alternatives
• Recommend solution

Tata Motors Case study:

Integrated operations across different departments,
Information flow and Student activity
benefits derived
Reverse engg.

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Thank You

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Additional info:
Strategic advantages

• Cost : Automation, reduced quality problems

• Response : Response to customer requirements/changes, 24*7 availability, alerts, workflow

Operational advantages

• Productivity
• Repeatability
• Volume of transactions
• Quality
• Uniformity/Standardized process
• Easy to monitor
• Security
• Easy retrieval
• Easy to train work force

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Additional info:

IS and Decision Making

Two situations when we need decision making either in business or personal life.

• Opportunity

• Challenge/problem

Decision making is a process of defining

• Intelligence (Problem definition)
• Design ( looking at alternatives)
• Choice ( selecting best solution based on cost benefit analysis (CBA)

INFORMATION is the basis for the entire decision making process.

MIS helps to manage it in a PAPERLESS way.

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Additional info:

Modular structure

Department wise subsystems. Departments

exchange information as per their needs.
Helps in phased development and
implementation.

Head of the organization gets integrated view

of the performance by aggregating
data/information across all the divisions and
departments.

Centralized and De-centralized IS.

SBU- Strategic Business Units can be
Also referred as federated structure.
another dimension for the IS structure

Exercise: Identify information exchanged between different

departments in an organization

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