Department of Business Administration

Management Information System

Course Code: IT 227
Credit Hours: 03

Instructor: Kamran Khan Tatari

(Assistant Professor)
WEEK # 10, Lecture # 01

Business Information System

 Definitions
Information Systems
An information system(IS) is typically considered to be a set of interrelated elements
or components that collect(input), manipulate(processes), and disseminate (output)
data and information and provide a feedback mechanism to meet an objective.
Open System
Close System

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 Types of Information Systems

1. Informal Information System

2. Formal Information System

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 Computer-based Information System
An Information System is an organized combination of people, hardware, software,
communication networks and the data resources that collects, transforms and
disseminates information in a organization.

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 IS Vs IT Payroll
System

INFORMATION
TECHNOLOGY Inventory
System
Hardware
Software are used to build
INFORMATION
Databases SYSTEMS
Networks
Marketing
Other related System
components

Customer
Service
System

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 Classification of IS
Information Systems

Operations Support
Management
System
Support System

Transaction Process Office Management Decision Executive

processing control automation information support information
systems
systems systems systems systems systems

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 Human Biases
• Acquisition/Input
– Data availability
– Selective perception
– Frequency
– Concrete information
– Illusory correlation • Output
• Processing – Question format
– Inconsistency – Scale effects
– Conservatism – Wishful thinking
– Non-linear extrapolation – Illusion of control
– Heuristics: Rules of thumb • Feedback
– Anchoring and adjustment – Learning on irrelevancies
– Representative ness – Misperception of chance
– Sample size – Success/failure attribution
– Justifiability – Logical fallacies in recall
– Regression bias – Hindsight bias
– Best guess strategies
– Complexity
– Emotional stress
– Social pressure
– Redundancy

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 Expanding Roles of IS

1. Data Processing: 1950s-1960s

2. Management Reporting: 1960s-1970s
3. Decision support: 1970s-1980s
4. Strategic and End User Support: 1980s-1990s
5. Global Internetworking: 1990s-2000s

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 • Understanding the Process
• Optimization
Why Build Models?
• Prediction
• Simulation or "What If"
Optimization
Scenarios
• Dangers Goal or output Maximum
variables

25

20 Model: defined
by the data points
Output 15 or equation
10
5 5

0 3
1 2 3
4 5 6 1
7 8 9 10
Input Levels

Control variables

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 Model Building
• Understand the Process
– Models force us to define objects and specify relationships. Modeling
is a first step in improving the business process.
• Optimization
– Models are used to search for the best solutions: Minimizing costs,
improving efficiency, increasing profits, and so on.
• Prediction
– Model parameters can be estimated from prior data. Sample data is
used to forecast future changes based on the model.
• Simulation
– Models are used to examine what might happen if we make changes to
the process or to examine relationships in more detail.

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 Prediction
25

20

Economic/
15
regression
Forecast
Output

10

Moving Average
0 Trend/Forecast
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Time/quarters

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 Simulation
Goal or output
variables
25

20

15
Results from altering
Output

internal rules
10

0
1 2 3 4 5 6 7 8 9 10
Input Levels

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 Object-Oriented Simulation Models

Custom Manufacturing
purchase
order

purchase
order Customer
routing Order Entry
& scheduling

Invoice

Parts
List
Shipping
Production
Schedule
Shipping

Inventory

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 Data Warehouse
Predefined
reports
Interactive
data analysis
Operations
data

Daily data
transfer
Database
tables
Data warehouse
Star configuration

Flat files

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Thank You…….