UCI 410: INFORMATION SYSTEMS

APPLICATION
 INTRODUCTION
Information Systems
Study of networks of hardware and software that
people and organizations use to collect, filter,
process, create, and distribute information.
Study bridges business and computer science
using the theoretical foundations
of information and computation to study various
business models.
 Cont…..
With the help of information systems,
enterprises and individuals are able to use
computers to collect, store, process,
analyze and distribute information.
Cont…..
Aims to support operations, management
and decision-making. The term is used to refer
not only to the information and communication
technology (ICT) that an organization uses, but
also to the way in which people interact with
this technology.
Information systems are also different from
business processes. Information systems help to
control the performance of business processes
Some types of Information Systems
Decision Support Systems
Knowledge-based systems (Expert systems)
Executive support systems
Manufacturing information systems
Financial information systems
Office Information Systems
Transaction Processing Systems
Management Information Systems
Cont…..
Lesson 1: Decision Making Process

Introduction:
Decision
◦ A choice from two or more alternatives.
Decision making: is the process by which managers respond to
opportunities and threats by analyzing options, and making
decisions about goals and courses of action.
I. Decisions in response to opportunities
II. Decisions in response to threats

Today information systems provide information to all levels of

management of an organization. So all the levels are responsible for
decision making.
Cont…

Decision making is often a manager’s most challenging

role
Information systems have helped managers
communicate and distribute information; however, they
have provided only limited assistance for management
decision making.
 Types of decisions

Senior Decide entrance

or exit from
Manager approve capital
Unstructured budget Decide
long-term goals

Middle Manager
Design a marketing
plan
Develop a
Semi structured departmental
budget
Design a new
Operational management corporate Web site

Individual Employees and teams Determine overtime

eligibility
Structured Restock inventory
Offer credit to
customers Determine
special offers to
customers
 Information systems requirement for decision
making & Mgt. Level
Types of decisions Managerial levels information Aspects
system needed

Senior Manager Executive Support

Unstructured System (ESS)

Middle Manager Management

Information
System(MIS) &
Semi structured Decision Support
System (DSS)

Operational Transaction
management Processing System
Structured (TPS)
 Types of decisions
Unstructured decisions

 The decisions are made by senior management.

 It is a non routine type decision.
 There is no specific procedure or structure for decision making.
 It includes strategic issues and long term effect of decision.
Structured decisions
 These decisions are made by operational managers.
 It is a repetitive and non routine type decision.
 There are specific structures and procedures for solving a problem and decision making.
 It involves operational issues and has a very short time effect.

Semi structured decisions

 These decisions are made by middle management.
 It is both routine and non routine type decisions.
 Usually it gives a clear cut solution of a problem.
 There is both structured and unstructured procedure for decision making.
 How decision making process work?

There are 4 stages in the decision making process

Problem Discovery :
What is the Problem ? Intelligence

Solution Discovery :
What are the possible Solutions?
Design

Choosing Solutions :
What is the best solution

Choice
Solution Tasting :
 Is the solution
working ?
 Can we make it
work better? Implementation

The decision-making process is broken down into four stages

STAGES IN DECISION MAKING

 Intelligence :
Decision making process starts with discovering (what), identifying (where)
and understanding (why) the problem is occurring in the organization. And
this is what the intelligence is concerned with
 Design :
After discovering, identifying and understanding the problem, decision maker
find some possible solution for the problem arising. Which is called Designing
the solution.
 Choice :
What solution alternative should be the perfect match for the problem
among solution alternatives is the concern of this stage.
 Implementation:
This is the situation where actually the decision is applied. After applying the
decision, Decision makers continuously monitor if the decision is right.
The decision making process may work like a cycle when the taken
decision works properly. Then decision maker again through same
stages. Then the decision cycle will be like following.
..cont
In general, the stages of decision making do not
necessarily follow a linear path
Decisions are often arrived at after a series of
iterations and evaluations at each stage in the
process.
The decision maker often must loop back
through one or more of the stages before
completing the process.
3.3 Managers, Decision Making, and Information Systems

Fig 3-10: The decision making process.

 Models of Decision Making
Individual Models of Decision Making
Organizational Models of Decision Making
Bureaucratic Models
Political Models
“Garbage Can” Model
 Individual Models of Decision Making
The basic assumption - human beings are in
some sense rational.
The rational model of human behavior is built
on the idea that people engage in basically
consistent, rational, value-maximizing
calculations.
Under this model, an individual identifies goals,
ranks all possible alternative actions by their
contributions to those goals, and chooses the
alternative that contributes most to those goals.
 Organizational Models of Decision Making
Decision making often is not performed by a
single individual but by entire groups or
organizations.
Organizational models of decision making take
into account the structural and political
characteristics of an organization.
Bureaucratic, political, and even “garbage can”
models have been proposed to describe how
decision making takes place in organizations.
We shall now consider each of these models.
 Bureaucratic Models
Models of decision making where decisions are
shaped by the organization’s standard operating
procedures (SOPs).

An organization’s most important goal is the

preservation of the organization itself.

The reduction of uncertainty is another major

goal.
 Cont…….
Policy tends to be incremental, only marginally
different from the past, because radical policy
departures involve too much uncertainty.

These models depict organizations generally as

not “choosing” or “deciding” in a rational
sense. Rather, according to bureaucratic models,
whatever organizations do is the result of
standard operating procedures (SOPs) honed
over years of active use.
Organizations rarely change these SOPs, because
they may have to change personnel and incur risks
(who knows if the new techniques work better than
the old ones?).
Although senior management and leaders are hired
to coordinate and lead the organization, they are
effectively trapped by the organization’s standard
solutions.
Some organizations do, of course, change; they
learn new ways of behaving; and they can be led.
But all of these changes require a long time. Look
around and you will find many organizations doing
pretty much what they did 10, 20, or even 30 years
 Political Models
Models of decision making where decisions
result from competition and bargaining among
the organization’s interest groups and key
leaders.

Power in organizations is shared; even the

lowest-level workers have some power.
Cont……
In political models of decision making, what an
organization does is a result of political bargains
struck among key leaders and interest groups.

Organizations do not come up with “solutions”

that are “chosen” to solve some “problem.”
They come up with compromises that reflect the
conflicts, the major stakeholders, the diverse
interests, the unequal power, and the confusion
that constitute politics.
“Garbage Can” Model:
Model of decision making that states that
organizations are not rational and that decisions are
solutions that become attached to problems for
accidental reasons.

A more recent theory of decision making, called the

“garbage can” model, states that organizations are not
rational.
Decision making is largely accidental and is the
product of a stream of solutions, problems, and
situations that are randomly associated
 Implications for System Design
Decision making is not a simple process.
Information systems do not make the decision
for humans but rather support the decision-
making process.
How this is done will depend on the types of
decisions, decision makers, and frames of
reference.
 ..cont making in organization is a group and
Decision
organizational process.
So, systems must be built to support group and
organizational decision making.
As a general rule, information systems
designers should design systems that have the
following characteristics:
 Cont…..
They are flexible and provide many options for handling
data and evaluating information.
They are capable of supporting a variety of styles, skills, and
knowledge.
They are powerful in the sense of having multiple analytical
and intuitive models for the evaluation of data and the
ability to keep track of many alternatives and consequences.
They reflect understanding of group and organizational
processes of decision making.
They are sensitive to the bureaucratic and political
requirements of systems.