MIS

Unit 3
3.1 MIS and decision making concept

MIS

Management information systems (MIS) is a discipline that sits at

the intersection of the business and computing disciplines. MIS is an
increasingly important discipline as it supports organizations as they
move from paper-based systems to computerized systems. The digital
transformation of business data and processes requires employees with
knowledge that spans across business domains, such as accounting,
finance, and marketing; and across computing and information
technology domains, such as software development, data science, and
networking. The MIS discipline prepares students to assist organizations
in digitizing work and managing an increasingly remote workforce.

An MIS is a system that provides managers with the necessary

information to make decisions about an organization's operations. The
MIS gathers data from various sources and processes it to provide
information tailored to the managers' and their staff's needs.

 Improved Decision-Making: One of MIS's most

significant benefits is its improved decision-making capabilities.
With real-time data and information at their fingertips, managers
can make informed decisions quickly and effectively, improving
their overall decision-making accuracy and efficiency.
 Increased Efficiency: Another major advantage of MIS is increased
efficiency. By automating repetitive tasks, MIS frees up employees
to focus on more important tasks, allowing them to work more
efficiently and effectively. Increased efficiency can help
 organisations stay ahead of the competition and achieve their
goals more quickly and effectively.

 Better Data Management: With a centralised location for storing

and accessing data, another importance of MIS is making it easier
to manage and analyse data. This improved data management
allows organisations to gain valuable insights into their operations,
identify areas for improvement, and make more informed
decisions.

 Enhanced Collaboration: Management Information Systems

importance facilitates collaboration between departments and
employees. By providing a common platform for exchanging
information, MIS allows employees to work together more
effectively, improving overall collaboration and communication
within the organisation.

 Increased Customer Satisfaction: Finally, MIS helps better

understand an organisation's customers and respond to their
needs. With real-time data and information about customer
preferences and behaviours, organisations can tailor their offerings
and services to meet the needs of their customers, leading to
increased customer satisfaction.

 Decision making system

Decision-making with MIS involves utilizing information and insights

provided by the Management Information System (MIS) to make
informed decisions. MIS offers a broad range of data and analysis,
including data processing, prediction, planning, control, and assistance,
to aid in making the best possible decisions.
The MIS provides quick, reliable, and accurate information, enabling
managers to make informed and prompt decisions. By leveraging the
insights provided by MIS, managers can analyze a variety of factors,
including financial, operational, and customer-related data, among
others.

A decision support system (DSS) is a computer-based information

system that supports business or organizational decision-making
activities, typically resulting in ranking, sorting, or choosing from among
alternatives. DSSs serve the management, operations, and planning
levels of an organization (usually mid and higher management) and help
people make decisions about problems that may be rapidly changing
and not easily specified in advance (i.e., unstructured and semi-
structured decision problems). Decision support systems can be either
fully computerized, human-powered or a combination of both.

Types of dms

Tactical Decisions
An important task of all employees within the organization is to make
decisions about various things. At the lowest level of the organization,
the workers have to decide how to go about their work. Although their
work is usually quite structured, they have to make choices and evaluate
consequences, using the given details.

For example, a salesperson may have a fixed route to travel to meet

several clients during the day, but he still has to decide how to proceed
given the actual conditions on the ground and also how many
appointments he already has, and how many are pending. These are
called tactical decisions. The salesperson has clear objectives to attain
and has to make minute, low-level decisions to achieve those objectives.

Consider another example of a shop-floor assembly line worker. In a

typical manufacturing assembly line, say in a factory that makes
automobiles, the worker is given a fixed set of jobs to do. The worker is
provided with the equipment and the material required to do the job and
is given a timeline for completing the work. The worker also has to
attend to other constraints that involve communicating with the
supervisor; adhering to company rules regarding safety, security, and
health, and interacting with co-workers.

Operational Decisions
Decisions made by managers that have a medium-term scope are often
called operational decisions. These decisions are based on aggregate
data and impact the activities for the medium term which could range
from the next few months to the next few quarters. Operational decisions
are often supported by decision support systems that use specialized
models to provide detailed and carefully analyzed solutions to decision
problems.

Travelling Salesman Problem

The traveling salesman problem is an example of an operational
decision. The problem is depicted. The salesman has to cover all the
cities in one tour at the lowest possible cost.

The salesman can start from Bangalore and then follow any sequence,
such as Chennai– Mumbai–Bhopal–New Delhi–Kolkata–Ranchi or
Kolkata–Ranchi– New Delhi–Mumbai– Bhopal–Chennai. If all the
combinations of cities are counted, there are 720 ways in which the
salesman can cover all the cities after starting from Bangalore.

Each of these is called a tour. For the lowest cost tour, the salesman
would have to calculate the distance covered for each possible tour and
take the shortest one. If the salesman starts the tour from any of the
other six cities, the problem increases to 5040 possible tours! It is very
difficult to compute the lowest cost for such a large number of tours.
Hence it is a wise step to rely on a decision support system that can do
the job efficiently.

The traveling salesman problem is a very well-known and well-

researched problem. When the number of cities increases to about 20,
the possible tours increase to more than 2 × 1018 tours which is about 2
million trillion tours! Such a large number of calculations become hard to
complete, even for computers.

Control and Planning

Supervisors, managers, and knowledge workers have to make decisions
that are more long-term in nature and are far removed from the hour-to-
hour and day-to-day activities of the firm. Managers and supervisors
need information for control and planning. Control implies monitoring
activities against given objectives, and taking action relevant to the
situation. To exercise control, managers need summary information that
shows how the activities of the organization have progressed and how
close they are to the given objectives.
Strategic Decisions
Another set of decisions made by top managers of an organization is
termed strategic decisions. These are long-term in scope and have a
long time horizon of years. By nature, these decisions impact the very
manner in which the organization does its work. Strategic decisions are
related to the vision and mission of the organization – the decisions
determine how the organization will realize what it was created for
originally and what it strives to achieve eventually.

3.2 Decision making process

Step 1 − Identification of the Purpose of the Decision

In this step, the problem is thoroughly analyzed. There are a

couple of questions one should ask when it comes to identifying
the purpose of the decision.

Step 2 − Information Gathering

A problem of an organization will have many stakeholders. In

addition, there can be dozens of factors involved and affected
by the problem.

In the process of solving the problem, you will have to gather

as much as information related to the factors and stakeholders
involved in the problem. For the process of information
gathering, tools such as 'Check Sheets' can be effectively used.

Step 3 − Principles for Judging the Alternatives

In this step, the baseline criteria for judging the alternatives

should be set up. When it comes to defining the criteria,
organizational goals as well as the corporate culture should be
taken into consideration.

As an example, profit is one of the main concerns in every

decision making process. Companies usually do not make
decisions that reduce profits, unless it is an exceptional case.
Likewise, baseline principles should be identified related to the
problem in hand.

Step 4 − Brainstorm and Analyze the Choices

For this step, brainstorming to list down all the ideas is the
best option. Before the idea generation step, it is vital to
understand the causes of the problem and prioritization of
causes.

For this, you can make use of Cause-and-Effect diagrams and

Pareto Chart tool. Cause-and-Effect diagram helps you to
identify all possible causes of the problem and Pareto chart
helps you to prioritize and identify the causes with the highest
effect.

Then, you can move on generating all possible solutions

(alternatives) for the problem in hand.

Step 5 − Evaluation of Alternatives

Use your judgment principles and decision-making criteria to

evaluate each alternative. In this step, experience and
effectiveness of the judgment principles come into play. You
need to compare each alternative for their positives and
negatives.

Step 6 − Select the Best Alternative

Once you go through from Step 1 to Step 5, this step is easy.

In addition, the selection of the best alternative is an informed
decision since you have already followed a methodology to
derive and select the best alternative.

Step 7 − Execute the decision

Convert your decision into a plan or a sequence of activities.

Execute your plan by yourself or with the help of subordinates.

Step 8 − Evaluate the Results

Evaluate the outcome of your decision. See whether there is

anything you should learn and then correct in future decision
making. This is one of the best practices that will improve your
decision-making skills.

3.3 system approach to problem solving in mis

The systems approach to problem solving used a systems orientation to
define problems and opportunities and develop solutions. Studying a
problem and formulating a solution

1. Defining Problems and Opportunities

Problems and opportunities are identified in the first step of the systems
approach. A problem can be defined as a basic condition that is causing
undesirable results. An opportunity is a basic condition that presents the
potential for desirable results. Symptoms must be separated from
problems. Symptoms are merely signals of an underlying cause or
problem.

2. Systems Thinking

Systems thinking is to try to find systems, subsystems, and components

of systems in any situation your are studying. This viewpoint ensures that
important factors and their interrelationships are considered. This is also
known as using a systems context, or having a systemic view of a
situation. I example, the business organization or business process in
which a problem or opportunity arises could be viewed as a system of
input, processing, output, feedback, and control components. Then to
understand a problem and save it, you would determine if these basic
system functions are being properly performed.

3. Developing Alternate Solutions

There are usually several different ways to solve any problem or pursue
any opportunity. Jumping immediately from problem definition to a
single solution is not a good idea. It limits your options and robs you of
the chance to consider the advantages and disadvantages of several
alternatives. You also lose the chance to combine the best points of
several alternative solutions.

Where do alternative solutions come from/ experience is good source.

The solutions that have worked, or at least been considered in the past,
should be considered again. Another good source of solutions is the
advice of others, including the recommendations of consultants and the
suggestions of expert systems. You should also use your intuition and
ingenuity to come up with a number of creative solutions. These could
include what you think is an ideal solution. The, more realistic
alternatives that recognize the limited financial, personnel, and other
resources of most organizations could be developed. Also, decision
support software packages can be used to develop and manipulate
financial, marketing, and other business operations. This simulation
process can help you generate a variety of alternative solutions. Finally,
don’t forget that “doing nothing” about a problem or opportunity is a
legitimate solution, with its own advantages and disadvantages.

4. Evaluating Alternate Solutions

Once alternative solutions have been developed, they must be evaluated

so that the best solution can be identified. The goal of evaluation is to
determine how well each alternative solution meets your business and
personal requirements. These requirements are key characteristics and
capabilities that you feed are necessary for your personal or business
success.

5. Selecting the Best Solution

Once all alternative solutions have been evaluated, you can being the
process of selecting the best solution. Alternative solutions can be
compared to each other because they have been evaluated using the
same criteria.

6. Desingning and Implementing Solution

Once a solution has been selected, it must be designed and

implemented. You may have to depend on other business end users
technical staff to help you develop design specifications and an
implementation plan. Typically, design specifications might describe the
detailed characteristics and capabilities of the people, hardware,
software, and data resources and information system activities needed
by a new system. An implementation plan specifies the resources,
activities, and timing needed for proper implementation.

7. Post Implementation Review

The final step of the systems approach recognizes that an implemented

solution can fail to solve the problem for which it was developed. The
real world has a way of confounding even the most well-designed
solutions. Therefore, the results of implementing a solution should be
monitored and evaluated. This is called a postimple-implemented. The
focus of this step is to determine if the implemented solution has indeed
helped the firm and selected subsystems meet their system objectives. If
not, the systems approach assumes you will cycle back to a previous step
and make another attempt to find a workable solution.

3.4 system approach of planning mis

What is Systems Approach?

Systems approach is a management perspective which advocates that
any business problem should be seen as system as a whole which is
made up of an hierarchy of sub-systems. So rather than seeing the
problem in parts it should be seen as whole. Systems approach can be
applied to all the business domains like administration, insurance,
banking, hospitality etc.
Though it defines system as a whole but it keeps focus on the
subsystems and components as well on their role in the entire system. It
is linked closely to Systems Thinking. A defined system has a clear
boundary and is separate from the environment. This makes it stand
apart to look at the problem and its solution. Each subsystem contributes
to making this system as a whole.
Many administrators and designers use the system approach to solve
and articulate a complex problem. It was first initiated by Ludwing Von
Bertalanfty.

The system approach is based on the generalization that all things are
inter-related and inter-dependent with one another. A system is made
up of related and dependent elements that form a unique system. A
system is simply an assemblage of things to forming a single unit.
One of the most significant characteristics is that it consists of a
subsystem hierarchy. These are the components that form the main
device, and so on. For instance, it is possible to view the world as a
system in which different national economies are sub-systems.

Features

 A system consists of interacting elements. It is set of inter-related and

inter-dependent parts arranged in a manner that produces a unified
whole.
 The various sub-systems should be studied in their inter-relationships
rather, than in isolation from each other.
 An organisational system has a boundary that determines which parts
are internal and which are external.
 A system does not exist in a vacuum. It receives information, material
and energy from other systems as inputs. These inputs undergo a
transformation process within a system and leave the system as output
to other systems.
 An organisation is a dynamic system as it is responsive to its
environment. It is vulnerable to change in its environment.
 It helps to see the problem at holistic level and resolves the issues
 Systems approach helps understand the problem in a better way and
comes up with more efficient solution
 It clearly defines the scope or the boundary for systems and problems
where in influence of internal and external factors can be seen

System Approach in Planning

Planning is an essential feature of management. Planning involves

deciding what needs to be done, who needs to do it, when to do it, and
how to do it in advance. Two phases are part of the preparation process:

 Developing the strategic.

 Formulating the steps which are necessary to accomplish the plan,
timing and expense.

System Approach in Planning: Planning means deciding in advance,

 What has to be done?
 Who has to do it?
 When is to be done?
 How it is to be done?
3.5 system approach in organizing and controlling mis

System Approach in Organizing

Organizing is important for managers because it leads to successful

group action. It also helps to keep people working together. The
following points are shows about the System Approach in Organizing -

The good structure of the organization as outlined in the policies and

procedure.

 Informal organizing.
 The individual as a device
 The method of organizational contact.
 The power chain.
 The functional method.
 The system for management process.

System Approach in Controlling

Controlling is necessary because the outcome of the desire needs to be

achieved. The most popular approach consists of a three-step procedure
—

Setting a performance standard requires the quality of performance we

need. Quantitative or qualitative maybe these parameters.

Performance assessment against this standard is important to assess

performance against standards once a standard has been developed.

Deviation Control-we understand that the first comparison of the norm

with real results is made to calculate the deviation.