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Management comprises of processes and activities like planning, organizing, controlling, directing and initiating. Decision making is a fundamental prerequisite for management processes There are two tools for the decision making framework: Highlighting the characteristics of Mission ,Objectives, Goals, Strategies The other one underlying the policies, programmes and procedures.
MISSION
OBJECTIVES
Action orientation of its mission Segmented into workable objectives and assigned at all levels of management hierarchy Objectives are manifold and priority levels are to be set for allocation of resources, to meet the objectives within specific timeframe
GOALS
Are time bound targets a desired future state that the organization attempts to realize Are necessary to move in the direction of achievements of organization objectives Fulfillment of objectives is dependent on the goals such as allocation of resources that are specific to objectives
STRATEGY
POLICIES
Are the guidelines framed to gear up the internal structure and operational activities of the business enterprise They provide the backup support to meet the objectives of an organization Org. efficiency depends directly upon framing up the right guidelines within the purview of the goals of an org. They are dynamic in nature
PROGRAMMES
They are concerned with the scheduling and organizing of the repetitive activities The constitution of the pragramme is based on the policies
PROCEDURES
These are the specifications of the sequence of steps to be undertaken in the activities to be performed. Are laid down to assist in a proper implementation of the programme by ensuring that the task activities are completed as per the prescribed schedule
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FUNCTIONS OF A MANAGER
To be skilled in functional specialty, such as engineering, marketing, sales, IT, legal or HR Traditional functions of planning, organizing, controlling, and initiating To be able to participate in design and utilization of computerized IS
FUNCTIONING OF MANAGEMENT
Planning: includes the strategy to select the course of action The following processes are needed in the course of planning Forecast Set objectives Develop strategies Decide programme Set budget Set procedures Develop policies
Organizing: Work is arranged efficiently Staffing : selection of qualified persons Directing : steps associated with getting things done through people Controlling : measures taken to carry out plan effectively and efficiently in pursuit of satisfactorily implementation of action towards the predetermined goals of an organization.
INFORMATION
Data that has been organized into a meaningful context. The processes such as collection, summarizing, analysis, interpretation, presentation of data leads to value addition to data. Cluster of facts that are meaningful and useful in various processes like decision making It is data that has been processed to add or create meaning and knowledge for the person who receives it.
USE OF INFORMATION
Information
Difference Between Data & Information
1) 2)
3)
Information is useful for decision making but data has got no value. Information brings clarity and creates an intelligent human response in the mind. Information is like a finished product whereas data is like raw material.
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Types of information
Information could be classified on the basis of the purpose for which it is utilized: Strategic information: required by the managers at the strategic level of management for the formulation of the organizational strategies. these relate to long term planning policies of the organization eg information pertaining to new technologies, new products, competitors etc. Tactical information: is used at management control level and is a short term planning. eg sales analysis and forecasts, production resource requirement etc
Operational information: applies to short periods which may vary from an hour to few days. It is generally used by decision makers at the operational level. (often required to take immediate actions) eg stock-inhand, work-in-progress levels, outstanding orders from the customers etc
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INFORMATION QUALITY
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SYSTEM
Is assembly of interrelated elements/components comprising a unified whole The term system means to combine, to set up ,to place together A system typically consists of components that are connected together in order to facilitate the flow of information , matter or energy A system is set of interrelated components working together to achieve a common purpose eg Education system, computer system, respiratory system. System works towards a common goal by accepting inputs and producing outputs
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System
control
feedback
input
process
output
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The systems approach is a way of analyzing business problems This approach views the business organization as a system of interrelated parts designed to accomplish goals Each subsystem is a self-contained unit, but is also a part of the whole system Managers need to understand the goals of the business and design the functions of the subsystems to achieve these goals
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An information system is the set of interrelated components that collect, process, store and distribute information used by/support one or more business process.
Input: The collection of raw data. Processing: The manipulation of data into information. Output: Distributing valuable information.
Also Includes both technology and people
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Input
Manufacturing subsystem
Process
Output
Customer needs
Input
Marketing subsystem
Process
Output
Finished goods
Process
Output
Product in use
Output
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INPUT
OUTPUT
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Hardware is a device such as a processor, monitor, keyboard or printer Software is a program or collection of programs that enable hardware to process data. Database is a collection of related files or tables containing data. Network is a connecting system (wireline or wireless) that permits different computers to share resources. Procedures are the set of instructions about how to combine the above components in order to process information and generate the desired output. People are those individuals who use the hardware and software,
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The major purpose of an information system is to convert data into information The information system is a subsystem of the business system of an organization Information systems that provide information on day to day activities of a business are known as operational systems Information systems that provide information to allow the management to allocate resources effectively are known as tactical systems Information systems that support the strategic plans of a business are known as strategic planning systems
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Data: Elementary description of things, events, activities, and transactions that are recorded, classified, and stored, but not organized to convey any specific meeting
Information Data that has been organized so that they have meaning and value to the recipient Knowledge Information that has been organized and processed to convey understanding, experience and expertise as they apply to a current problem or activity
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Roles of IS
Support daily tasks of line workers within a business function across business functions knowledge work and production work support effectiveness and efficiency Support decision making across management levels and functions individual and group strategic, control (e.g., scheduling, resource allocations) Provide feedback Effectiveness (e.g., conformance), Efficiency (e.g., cost, cycle time), Adaptability (e.g., response time) Between levels, between functions Facilitate communication Policy and Goals Coordination and direction Interact with environment (e.g., Customers, Suppliers).
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Operational-level
Elementary activities and routine transactions Data current and accurate Support knowledge and data workers Integrate new knowledge into the business Office automation Periodic monitoring, control, decision-making and administration Is the business working well?
Knowledge-level
Management-level
Strategic-level
Long-term (e.g. 5 year) planning and strategy Internal and external information
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Examples
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Its acronym of three words Management Information System It is a set of organized procedures which when executed provides information to support decision making Its a combination of human and computer based resources which result in collection , storage, retrieval, communication, and use of data for the purpose of efficient management of operation and for business planning A system to convert data from internal and external sources into information to communicate the information in an appropriate form to managers at all levels , in all functions, directing and controlling the activities for which they are responsible. A set of computer based systems and procedures implemented to help managers in their crucial job of decision making
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CHARACTERISTICS
System approach Management oriented Management directed Need based Exception based Future oriented Integrated Common data flows Long term planning Sub system concept Control database Flexible Reliable Simple
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MIS FUNCTIONS
Data capturing Processing of data Storage of information Retrieval of information Dissemination of management information Confirmation of validity of data and transactions Reactive and proactive response Communication of information
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GROUPS SERVED
SENIOR MANAGERS
MANAGEMENT LEVEL
MIDDLE MANAGERS
KNOWLEDGE LEVEL
OPERATIONAL LEVEL
SALES & MARKETING
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TYPES OF IS
Executive Support Systems (ESS) Management Information Systems (MIS) Decision Support Systems (DSS) Knowledge Work Systems (KWS) Office Automation Systems (OAS) Transaction Processing Systems
(TPS)
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Payroll System
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Operational-level Systems Sales and marketing Order tracking Order processing Manufacturing Finance Accounting Human Resources Compensation
Machine control
Payroll
Plant scheduling
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Management-level Systems Sales and Marketing Manufacturing Finance Accounting Human Resources
Production scheduling
Cost analysis
Types of Decisions 1. Unstructured Decisions Novel, non-routine decisions requiring judgment and insights Examples: Approve capital budget; decide corporate objectives 2. Structured Decisions Routine decisions with definite procedures Examples: Restock inventory; determine special offers to customers 3. Semistructured Decisions Only part of decision has clear-cut answers provided by accepted procedures Examples: Allocate resources to managers; develop a marketing plan
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Information system at the management level of an organization that serves the functions of planning, controlling, and decision making by providing routine summary and exception reports.
Type: Inputs: Processing: outputs: Users: Decision-making: Example: Management-level High volume data Simple models Summary reports Middle managers Structured to semi-structured Annual budgeting, Capital investment
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Strategic Level Aggregate Data; Internal And External Interactive Projections Senior Managers Highly Unstructured 5 year operating plan
Strategic-level Systems
Manufacturing
Finance
Accounting
Human Resources
Profit planning
Personnel planning
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M IS DSS
M anage me nt-Le ve l Sys te ms Capital Annual Re location Inve s tme nt analys is analys is budge ting Cos t analys is Pricing/profitability Contract cos t analys is analys is
KWS OAS
Orde r proce s s ing M ate rial move me nt Cas h manage me nt control Sale s and mark e ting M anufacturing Finance
Accounting
Human Re s ource s
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Expert System
An expert system is a computer program that represents and reasons with knowledge of some specialist subject with a view to solving problems or giving advice. Possess knowledge Specific domain Solving problem or giving advice
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Expertise Capable of making expert level decisions Deep knowledge Knowledge base contains complex knowledge Self-knowledge Able to examine own reasoning
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1. Knowledge base Facts Special heuristics to direct use of knowledge the software that represents the knowledge 2. Inference engine Brain Control structure Rule interpreter The reasoning mechanism that draws conclusions (the interpreter or control structure) 3. User interface Language processor
The hardware and software that provide the dialog between user and the computer
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LIMITATIONS
Knowledge not always readily available Difficult to extract expertise from humans Approaches vary Natural cognitive limitations Vocabulary limited Wrong recommendations Lack of end-user trust Knowledge subject to biases Systems may not be able to arrive at conclusions
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Increased outputs Increased productivity Decreased decision-making time Increased process and product quality Reduced downtime Capture of scarce expertise Flexibility Ease of complex equipment operation Elimination of expensive monitoring equipment Operation in hazardous environments Access to knowledge and help desks
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Ability to work with incomplete, imprecise, uncertain data Provides training Enhanced problem solving and decision-making Rapid feedback Facilitate communications Reliable decision quality Ability to solve complex problems Ease of knowledge transfer to remote locations Provides intelligent capabilities to other information systems
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Finance Insurance evaluation, credit analysis, tax planning, financial planning and reporting, performance evaluation Data processing Systems planning, equipment maintenance, vendor evaluation, network management Marketing Customer-relationship management, market analysis, product planning Human resources HR planning, performance evaluation, scheduling, pension management, legal advising Manufacturing Production planning, quality management, product design, equipment maintenance and repair
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Functional Examples
Examples of IS by function:
Sales and marketing Manufacturing and production Finance and accounting Human resources
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The accounting information system The finance information system The manufacturing (operations, production) information system The marketing information system The human resources information system
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Systems that help the firm identify customers for the firms products or services, develop products and services to meet customers needs, promote products and services, sell the products and services, and provide ongoing customer support.
EXAMPLES System Order processing Market analysis Description Enter, process, and track orders Identify customers and markets using data on demographics, markets, consumer behavior, and trends Determine prices for products and services Organizational Level Operational Knowledge
Pricing analysis
Management
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Systems that deal with the planning, development, and production of products and services and with controlling the flow of production.
Examples System Description Machine control Control the actions of machines and equipment Computer-aided design (CAD) Design new products using the computer Production planning Decide when and how many products should be produced Facilities location Decide where to locate new production facilities
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Systems that keep track of the firms financial assets and fund flows.
Examples System Description Accounts receivable Track money owed the firm Portfolio analysis Design the firm's portfolio of investments Budgeting Prepare short-term budgets Profit planning Plan long-term profits
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Systems that maintain employee records; Track employee skills, job performance, and training; And support planning for employee compensation and career development.
Examples System Description Training and development Track employae training, skills, and performance appraisals Career pathing Design career paths for employees Compensation analysis Monitor the range and distribution ofemployee wages, salaries, and bene6cs Human resources planning Plan the long-term labor force needs of the organization
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