MANAGEMENT INFORMATION SYSTEM

Q1.In the current e-world any organisations massive operations are managed by various types of
information systems that help them to achieve their goals of servicing their clients. This can be done
by the growth of modern organization. Discuss some of the essential features of modern organisation.

Essential features of modern organization:

1 IT-Enabled organisation
2 Networked organisation
3 Dispersed organisation
4 Knowledge organisation

IT-Enabled organization:The organisations discussed above are modern in the sense that they have built
into their structure the elements of information technology (IT) that enable them to function in a
manner appropriate to the demands of the environment. This is a fundamental difference between a
modern organisation and its older, pre modern incarnation. Tata Motors, for instance, upon its initiation
in 1945 would also have put in place built-in mechanisms to respond to its environment andto function
in a manner appropriate to that time. However, what distinguishes Tata Motors functioning then and
now is the difference in the current use of IT to shape its functioning and responsiveness.

Networked organization:Modern organisations function in a world of digital networks in addition to the

physical world that was the same for the old organisations. The organisations are linked as nodes on the
network where they receive and transmit information. Remaining on the network requires sensing and
responding to this flow of information. The digital network consists of the Internet and
telecommunication networks that rely on digits (ones and zeros) to carry information across large
distances. Sensing the world means frequent monitoring of the news and information that becomes
available. This information is in the form of text, audio, or video. Organisations such as Tata Motors have
to constantly monitor their digital environment to learn about the markets, their competition, their
partners, and the business they operate in.
Responding to the digital information available to organisations is also a modern challenge. Information
is widely available instantly and in multiple forms. Responding means taking those actions that will move
the organisation towards its goals. The response could be in the form of further transfer of information
on the digital networks, say, by issuing messages or by taking action in the physical world. Responses are
shaped by the context of the situation that the organisation operates in and by the nature of the sensed
information. For example, when Tata Motors launched its widely popular Nano car, it anticipated a huge
demand for information from its website by prospective customers. Therefore, it designed the site in
such a manner that it could handle the rush adequately.

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Dispersed organization:Another key aspect of many large modern organisations is that they are highly
dispersed. Tata Motors, for instance, has operations in many cities in India and in other parts of the
world. The companies disperse their operations to best meet customer needs or to locate functions
where the resources such as skilled labour or raw materials are available. Multinational organisations
are well known to seek out new destinations fortheir operations and also new markets. They are able to
do this owing to laws and facilities that are created by host nations, as it benefits their economy. The
challenge for multinational organisations is to fully use the opportunities thus created and manage work
and organisational issues in a new environment.

Knowledge organization:Modern organisations rely on knowledge workers to a much larger extent than
older organisations. These workers differ from blue-collar workers as their work responsibilities involve
accessing and dealing with knowledge about the work and the environment, as opposed to repetitive
manual labour related to production. Knowledge workers enjoy greater autonomy in their work and the
variety of work they have to perform. Consequently, they are better educated and more informed about
the business they are working in.
A major function of modern organisations is to process information. They create information about
goods and services, accumulate it within the organisation and use it to achieve their goals. Information
is like glue that binds the organisation and its functions together. For commercial organisations, it is a
key component for competing in the market. Information is stored, processed and converted into forms
that make it an integral part of an organisation. This is referred to as the organisations knowledge base.
Knowledge stored and accessed in this manner enables the organisation to drive action and shape its
own understanding of the world.

2.Marketing managers are keener to look for a least cost route that also allows a sales person to meet
all his customers. Identifying a least cost route with this features is slightly complicated. Therefore,
managers depend on decision support tools to find the most cost effective routes to cover the market.
The travelling salesman problem is one of such tool. Describe the tool with a diagram.

The figure below depicts the travelling salesman problem which is an example of an operational
decision. The salesman has to cover all the cities in one tour at the lowest possible cost.

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 Fig: Travelling salesman problem (the figure shows the distances between seven cities in India)
The salesman can start from Bangalore and then follow any sequence, such as ChennaiMumbai
BhopalNew DelhiKolkataRanchi or KolkataRanchiNew DelhiMumbaiBhopalChennai. 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 travelling 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 are about
2 million trillion tours! Such a large number of calculations become hard to complete, even for
computers.

3.There are many examples of digital goods. Companies such as Amazon.com are selling digital
versions of books over their site. These digital books can be read on special readers that display the
pages on a screen.
a. List the important properties of information goods
b. Explain positive feedback with diagrams

a)Information goods have certain properties that make them distinct from physical goods.
Information goods are typically expensive to produce but very cheap to reproduce. For example, the
original cost of producing a music track by a professional band may run into millions of rupees.
However, once the digital version of the track is available, it can be reproduced or copied for almost
no cost or at a very low cost.

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To broadcast cricket scores in India, the mobile phone companies have to pay a high upfront fee to
the cricket match organisers. Once the scores are purchased and sent out on SMS networks, as is
the case for many international cricket matches in India, the cost of reproducing the message across
the network is very low. It is widely believed that owing to the spread of MP3 music fi les across the
Internet, the music industry as a whole has been deeply affected. Many new businesses have
evolved that directly sell music files off the Internet; the most famous example of this is the iTunes
store that sells music fi les for the Apple music players. Many bands and music groups have also
started selling and distributing their songs directly over the Internet. Many argue that the life of the
physical, paper-based book is about to decline with the advent of the digital book readers. Book
buyers can now buy books directly over the Internet and have them instantly available on their
digital readers. The digital readers have massive capacities; one such device can store thousands of
books. Besides, some of them provide access through wireless networks to a huge library of free and
paid books that the readers can access instantly. Another property of digital goods is that they can
be converted into versions quite easily. A version of a good is a form that is different from the
original, yet of the same nature. For example, physical books are typically released in the market as
cloth-bound books that are more expensive; and a few months later the same book is released in a
paper-bound version. The content of both the books is exactly the same except that the expensive
version has a better quality of binding and better printing; and the cheaper version usually has
smaller print and the paper is of lower quality. The main difference in the two is that one is released
earlier and one later. Those customers who are keen to read the book early pay a higher price for
the cloth-bound book. Information goods that have a time value can be versioned quite easily using
information technology. For example, cricket scores that are sent out on SMS have a small price.
However, the same scores can be obtained a few minutes later in an online form for free. Many
providers of free stock quotes still give a delayed version, whereas the real-time quote is available
for a small fee.
Many software makers give away a free version of their software for users to sample, and keep a
priced version for sale. This addresses another property of digital goods many information goods
are experience goods. This implies that the true value of the goods is evident only after they have
been experienced. For example, the value of a magazine article or a book can only be realised after
it has been read. This is true for all magazine articles and all books. Even the value of weekly
magazines, which arrive every week, can only be gauged when they have been read. This is a strong
contrast to consumables such as a soft drink whose value is known after consuming it only once.
Owing to the property of experience, sellers of information goods often find it useful to allow
customers to sample the goods, often through a free download of a lesser quality version. Many
websites allow visitors to hear portions of a music track or see clips of videos to allow them to
experience the goods and make a choice about purchasing them.

b)Positive feedback: In a situation where there is a benefit for individual users when many others
start using a network technology, the benefit from using the network acts as a boost for all the
users. For example, when people start using e-mail that allows them to send messages and
documents to many others, they realise the benefit or value of the network and then are
encouraged to use it even more. When they use the e-mail network more often, others are further

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 encouraged too, and the usage of the technology grows. This is positive feedback. Positive feedback
has been observed in many technologies that have network externalities. The growth in users of a
network technology that has positive feedback follows an S-shaped curve. Thefigure below shows
positive feedback influencing users and the S curve showing growth of users. At the initial stages of
introducing a technology, there are few users and they realise less value from their use as there are
very few other users. When the usage grows, over a period of time, the value to individual users
grows and this fi res greater positive feedback. At a certain point, a critical mass of users is reached,
where the positive feedback is so strong that many other users now start to join the network
quickly. The curve rises sharply at this time. The number of users finds a saturation point at which
time the curve levels off.

Fig: (a) Positive feedback influencing users of Facebook and (b) the S curve of growth of users

The S-shaped curve of positive feedback depicts the phenomenon explained above. However, there are
some issues that are pertinent. The flat part of the curve, where users are still adding to the network
and the critical mass has not been reached, may last for a long time. For example, the fax machine was
at the flat part of the curve for over a hundred years before it reached critical mass and lots of
organisations started buying and using fax machines. The effect of positive feedback is strongly evident
in social networking sites such as Facebook. When people join the site and become users of Facebook,
they may like the experience. This prompts them to encourage their friends, family and colleagues to
join too. Potential users find that it is easy to join a networking site like Facebook. This encourages new
users to join and the cycle continues. As more users join the network, the value that each derives is
increased and thus their enjoyment too increases. The opposite of positive feedback is negative
feedback. In the above example, if the new users find that they do not like the social networking site
then they will not encourage others to join. This will cause negative feedback which will not allow the
network to grow.

4.Decision support systems (DSS) are used extensively across organisations to assist managers with
making decisions. Decision making by managers involves the phases of intelligence, design, and
choice, and DSS help mainly with the choice part as they support structured and unstructured types of
decisions.

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a. What is it that managers do when they make decisions?
b. Explain the different types of decisions

Decision making process:

When making a decision, humans tend to follow Simons Intelligence-Design-Choice Model. In the
first stage, that of intelligence, they collect information about the issue from the environment and
the surrounding context. For example, if a person is faced with the problem of travelling from
Bangalore to New Delhi, a distance of about 2000 km, then in the intelligence stage the person will
seek all possible information of how to travel by air, by train, by bus, or by a personal vehicle. This
inquiry is open-ended and will involve searching for all possible avenues by which the problem can
be solved.
Once the intelligence information is available, the decision maker moves on to the next stage which
is the design stage. This question requires the decision maker to settle on the criteria that are
important, and then select or rank-order them. For example, the choice of cost and time may be the
most important criteria for the decision-making process. In our example of the BangaloreNew Delhi
journey, it may also be specified that no more than a certain amount of money may be spent and no
more than a certain amount of time can be used for the journey.
At the next stage, that of choice, the criteria are applied to select the best answer from the available
choices. For example, based on the criteria of cost and time available, it may be best to travel to
Delhi from Bangalore by train.
At the choice stage, the criteria and parameters for the decision help curtail the amount of search
required to arrive at a decision. If the criteria are not specified sharply then the number of
alternatives to be considered to arrive at a decision may be very large. This stage may also require
returning to the intelligence gathering activity, and then to the design stage to change or modify the
criteria and the weights used to apply them.
DSS are designed to support mainly the choice stage of the decision-making process. Managers can
enter the relevant data into the system, select or prioritise their criteria and let the system decide
on the final solution. Mathematical models are usually built into the system to help analyse the data
and arrive at solutions.

Types of decisions:
The problem is to then find the best solution among the many possible tours the salesman could go
on. DSS effectively tackle such structured problems. However, it should be mentioned that the
travelling salesman problem is very hard to solve, especially if the number of cities exceeds 30.

Unstructured problems do not have clearly defined parameters or criteria for selecting solutions.
For example, finding the best candidate for filling the position of a Chief Executive Officer of a firm is
an unstructured problem. The criteria may not be sharply defined, the parameters by which to
describe and evaluate the candidates may also not be sharply identified, as they pertain to
subjective concepts like personality, leadership skills, vision, motivation, and so on. Unstructured
decision problems are usually solved by imposing some form of structure in order to apply the
analysis and select the best candidate.

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 Large classes of problems are of the nature of semi-structured problems - where some parameters
are specified, but other parameters have to be determined by studying the problem domain
carefully. The problem of finding the best marketing campaign for a product, for example, is a semi-
structured problem where some parameters such as the budgets, the target population, etc., are
known, but others such as the effectiveness of the media may not be known.

5.What is crowdsourcing? How does the site Galaxy Zoo manage crowdsourcing?

Crowdsourcing:
Crowdsourcing is the process of obtaining needed services, ideas, or content by soliciting
contributions from a large group of people, and especially from an online community, rather than
from traditional employees or suppliers. While this definition from Merriam Webster is valid, a more
specific definition is heavily debated.

Galaxy Zoo is a crowdsourced astronomy project which invites people to assist in the morphology
classification, large numbers of galaxies. It is an example of citizen science as it enlists the help of
members of the public to help in scientific research.
Galaxy Zoo recruited volunteers to help with the largest galaxy census ever carried out. Opening the
project to amateurs saved the professional astronomers the job of studying all the galaxies
themselves, and it meant that the project could classify over 900,000 galaxies in months rather than
years. Computer programs had been unable to reliably classify galaxies: several groups had
attempted to develop image-analysis programs. However, volunteers astonished the projects
organizers by classifying the entire catalog years ahead of schedule. Indeed, because of the flood of
emails with images and queries, an online forum was set up two weeks after the initial start.
This Galaxy Zoo forum became a hotbed for the discussion of the SDSS images and more general
science questions. The contributions, both creative and academic, that people have made to the
forum are as stunning as the sight of any spiral, and never fail to move me.
One of the original aims for Galaxy Zoo was to explore which way galaxies rotated. Cosmologist Kate
Land stated:" Some people have argued that galaxies are rotating all in agreement with each other,
not randomly as we'd expect. We want people to classify the galaxies according to which way
they're rotating and I'll be able to go and see if there's anything bizarre going on. If there are any
patterns that we're not expecting, it could really turn up some surprises.

6.Data and information relating to individuals could be of sensitive nature. Give some examples of
such kind of data.

Data and information relating to individuals could be of sensitive nature. Some examples of such kind of
data are as follows
1. Employees, who work extensively with computers, log in every morning when they come to work and
log out in the evening when they leave. During the working day, every time they leave their desk or are
not working on the computer, the system logs their inactivity at work. For example, a United Airlines

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worker, in the USA, was threatened with job loss on the grounds that she had spent more than the
allotted time in the bathroom, making her co-workers take up her work.
2. Medical records detailing illnesses and treatments, hospital visits, and medication routines are all
stored on organisational databases that contain personnel data. The data is specific to individuals and,
for some organisations, also contains details about the individuals family members. In the USA, for
example, the medical records of the famous singer Britney Spears were read by employees of a hospital
in which she was treated. The employees later leaked the information to the press. Spears took legal
action against the hospital, which had to fire several employees.
3. Web surfing activities of individuals are also logged by corporate web servers. Which sites individuals
have visited, how long they have been on the site, and what kind of material they have downloaded are
also logged. A multinational media firm, for example, threatened to fire an employee based on his visits
to Yahoo.com from an office computer. The firm had obtained details about the employees surfing
behaviour from server logs.
4. Security systems in some organisations, which are based on swipe cards or security cards that enable
doors and office buildings to be opened or accessed, retain records of all individual movements across
buildings and workplaces. Data pertaining to individual movements is available in security logs. In the
Vatican, for example, swipes were re-introduced in 2008 to monitor the movement of employees. This
was in response to criticism that employees were slacking off. Even though the Pope was not entirely in
favour of such monitoring, it was introduced to improve efficiency of staff.
5. Many organisations also check all incoming and outgoing e-mails of their personnel. The e-mails are
checked for content and attachments. Some organisations either remove e-mails containing certain
keywords, such as expletives, or flag them to warn employees.