Management Information Systems

SESSION 2 - STRATEGIC INFORMATION SYSTEMS

Assignment
Case Study You are the Senior Manager of a major wireless telecommunications provider. Your main competitor in this industry has recently announced that they will be releasing a new generation internet service that will significantly increase internet access speeds for wireless devices (e.g. smartphones, tablets)

In the last Board Meeting, you were chosen to determine whether your company should also consider deploying a similar service. The new generation service is based on an entirely new technology and as such will require customers to buy new wireless devices

Assignment
The Board has a few concerns:

High cost associated with replacement of IT equipment and systems Will this new technology be readily adopted by customers Is this the technology of the future? Will the competitor be stealing your customers?

Requirements:
Submit a report of 1500 words for the Board discussing the benefits of your suggested plan of action and risks associated to it.

How long to wait? Adopt / Ignore the new technology What information will you look at for the basis of your decision

Assignment
Being a senior manager, you have access to various resources:

corporate database Information on billing, customers Marketing team Information on the IT infrastructure

DEADLINE: 16th November 2013

Evolution of IS
The earliest IS developed in the 1960s Evolution from local business environments to emerging interconnected ones Enterprises with blurred boundaries and increasing interconnections

Evolution of Information Systems

Eras of IS:
Data Processing (1960s +) Management Information Systems - MIS (1970s +) Strategic Information Systems - SIS (1980s +) Inter-organisational Operating Systems - IOS / Extended Business Networks(1990s +)

Data Processing Era

Automate business processes Focus on Processing predefined transactions

Purchase Orders, Customer Orders, Payroll Records

Only processing transaction data
Did not meet information needs of managers, no ad hoc reports

Limitations:

MIS Era
Data stored across the organisation + more flexible and user friendly tools Development of IS that support management decision making New capabilities of IS

Enquiry (searching database) Analysis (what-if scenarios)

SIS Era

Aim:

improving an organisations competitive position changing the way business is conducted Establishing links to business partners and customers Flexible, externally focused, driven by business requirements and customer requirements

SIS

IOS / Extended Business Networks

Extend between two or more organisations with distinct structures, strategies, business processes, IT infrastructure Added complexity: important alliances and linkages to suppliers and business partners

Key Characteristics of SIS

Significantly changes business performance Contributes to attaining a strategic goal (e.g. increase sales volume by a percentage) Fundamentally changes the way the organisation does business

Dealing with suppliers, customer Changing the way it competes e.g. a supermarket developing a cyberstore (ASDA, TESCO, Sainsburys)

Objectives, Decisions and Information

Information Manager How do we determine what information a manager needs?

Information determined by decisions

How do we determine what decisions need to be taken?

Decisions determined by Objectives

Objectives Decisions Information Needs

Objectives, Decisions and Information

Example

Objective is to increase net profit by 50% Decisions?

Which products should be emphasised? Do we buy the product externally?

Where do we get the information to formulate the decisions?

From MIS E.g. How well each product is selling

Levels of Decision Making

Decision

Strategic (Top management) Tactical (Middle management) Operational (Lower level management)

Levels of Decision Making

Strategic

Establish objectives for organisation and long range plans to attain objective e.g. decision on location of plants, sources of capital, which products to produce

Levels of Decision Making

Tactical

Implement decisions made at strategic level Allocate resources to pursue organisation objectives
e.g. plant layout, budget allocation, personnel concerns, production scheduling

Levels of Decision Making

Operational

Executing specific tasks and assuring they are carried out effectively and efficiently
e.g. accepting/rejecting, determining inventory reorder times and quantity, assigning jobs to workers

Characteristics of Levels of Decision Making

Characteristic Operational Tactical Strategic

Degree of Low judgement Planning Few Decisions Problem Variety Low

Time Horizon Days

Moderate About Half

Moderate Months

High Most
High Years

Characteristics of Information
Information Characteristic Operational Tactical Strategic

Dependence on IS
Dependence on Info Summarisation Need for computer graphics

High
Very low Low

Low
Moderate Moderate

Low to Moderate
High High

Use of Real Time info

Use of Predictive info

Very high
Low

High
High

Moderate
Very High

Decision Support Systems (DSS)

In the past, MIS have provided routine, structured and anticipated types of information Less successful in providing unstructured decisions DSS

An extension of MIS Set of computer tools to allow decision maker retrieve info for unstructured decisions

Components of a DSS
Language System Procedural language Non Procedural Language

Problem Processing System

Management Science Models Graphics Spreadsheet Financial Functions

Knowledge System
Expert System DBMS

Allows users to interact with DSS

Perform Processing Tasks

Provides data + AI capabilities to the DSS

Components of a DSS

Procedural language: User provides logical steps to solve problem Non-procedural language: User specifies characteristics of the problem (query) ; DSS determines logical steps to provide info Management Science models: regression, time analysis

Expert system: provides advice and explains the advice where necessary

Expert System

Component of DSS Computer program that enables computer to make an unstructured decision (normally made by human with expertise)

e.g. diagnosis of diseases, loan approvals, sizing of computer systems based on workload

Benefits of Expert System

Improve Consistency and Accuracy of decisions Documentation of the Rationale