Ebus3010 -Lecture 01 - Definition of MIS - A Chapter From Davis & Olson

5/11/2018 Ebus3010 -Lecture 01 - Definition of MIS - A Chapter From Davis & Olson

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McGraw-Hill Series fn ManagementInformation SystemsGordon B. Davis. ConSultillg Editor

Davis and 01s011; M af !( l8 et ne nt I nf or ma ti on S ys te ms : C on ce pt uo ! F au nd at io ns , S tr uc tu re , a ndDi'v.lapmenl

D a vi s a nd Everest: Readillgs it, Ma t li 1 gem en t l i if o T71 J l 1! i on S y s tem s!Jic!


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CHAPTER 2STRUCTURE OFA MANAGEMENT INFORMATIONSYSTEM

OPERATING E L EM ENT S O F AN INFORMATION SYSTEMPhysical ComponentsP ro c es s in g F u nc t io n sOUlput. for US41>

M AN AG EM EN T IN FO RM AT IO N S YS TE M S UPP OR T F OR DECISION MAKINGStructured, Programmable DecisionsU n s rr uc ru re d , N a np ro g ramma b le D e c is io n .

M AN AG EM EN T IN FO RM A TIO N S YS TE M S TR UC TU REBASED ON MANAGEMENTACfIVITYH ie ra rc hy o f M e na ge me m A c tl vi ty

I nf er rn ad on S ys ie ms f or O p er at io na l C on tr olI ni 'Q nn at io n S ys te ms f or M a na ge me nt C on tr olleformatic n Sy'tem, for Str~logic PIenning

'M AN AG EM EN T IN FO RM A TIO N S YS TE M S TR Uc ru REB AS ED O N O RG AN IZ AT IO NA L F UN CT IO N

S al e, a nd M a rk et in g S ub sy s! el T\ SP r od u c ti o n Sub s ys t er nL o gi st ic s S ubsysiemP e r so n n el S ub sy s t em


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F in a nc e o n d Ao co u nt in g SubsystemInformation P.-ocessing SubsystemT ap M o n" ge me nt S ub sy st em

S YN TH ES IS O F M AN AG EM ENT IN FO RM AT IO N S YS TEM S TR UC TU REConceptual StruerurePhysical Structure

SOM E ISSU ES OF M ANAG EM ENT INfORM AT ION SYST EM ST RU CTU REF e rm a l v e rs us Informal l nf or m at lo n S ys te m sEx ten t o f Tn ! "8 r ,n ion

,- '" E xte nt of User-Mach in e InteractionSUMMARYMINICASESEXERCISESS EL E CT ED R EF ER EN C ES

W hat does a m anagem ent inform ation system look like? W hat is its concep tualst ructure?Wh at i s i ts p hy si c al s tr uc t ur e ? Th is c ha p te r a d dr es se s these quest ions. T he re i sn o s ta n da r d, a g re e d- up o n f ram ewo rk for describing management information systems:How e ve r, t he c en tr al tendency i s r ef h; ct ed i n t he c ha pt er .

This chapter emphasizes the scope of MrS as a broad concept and thus reflects M . ideal"' toward which an o rga ni za ti on m ay m ov e as il designs o r r ed e si gn s itsinformation systems. The organization '5 management information s ys te m i s nOI ad i st in c t e n ti ty , s ep a ra t e from i ts o t he r i n fo rm a ti on s ys tem s. Rather i t represents 3 broadframework w i th in w h ic h i n di vi d ua l information sys tems (or subsystems) lit. In the text,"management i nf orma ti on s ys tem" and " In fo rma ti on system" are used interchan-geably t o r ef er t o t hi s b ro ad f ramewo rk .

L ike most complex sys tems, a management inforrnation system can be descr ibed inanumber of different ways, For example, imagine descr ib ing an a ut om ob il e t o someonew i th ou t p ri or experience with" car . lt m ig ht b e explained in te rm s o f its physicalcharacteristics of s ha p e, c o lo r , sealing capacity, number of doors , c tc .J r cou ld also bedescribed i n t erm s of Ihe componeru s ys tem s s uc h a s c ha s si s, e n gi ne . o r t ra n sm i ss io n ,and h ow t he s e components are relared 10 achieve a working automobile. On e might alsoclassify cars i n t e rm s o f m a jo r u se , s uc h ali a s t at i on wagon. s ed an . a nd s po rt s c ar . Eachof these c lass i f ica t ions wou ld p ro vi de in si gh t t o th e p er so n s ee ki ng t o underst andautomobiles .

Multiple approaches are used in this chapter to explain the structure of lino r ga n iz a ti on a l i n fo rm a~ io n s ys tem O rmanagement. information system, Tile inlortl1,tions ys tem i s d es cr ib ed 1 .0 terms of four separate bUI related classifications:

I Operoting elements2 Dec i sion s uppo r t3 Managemen t Dctivity4 Orgenizauonst function

A ft er d es cr ib in g m a na ge rn em l nf or ma nc n s ys te m s from t he se f ou r p er sp e ct iv e s, t hec h ap te r p re se n ts a synthesis or the last three categories into a s in gl e m o de l of am a na geme nt i nf or ma ti oa s ys te m ,OPERATING ELEMENTS OF AN INFORMATION SYSTEMIf one reques ted to be shown t he i n fo rma rl o n s ys tem of a n o r ga n iz a ti on , h e or she wouldprobably he s hown i ts phys i cal componen ts . An inquir y as to what these physicalcompcnents do might be answered in terms o f p roces sing funcdons or perhaps in termsof system OUtputs for users.

Physical ComponentsThe physi cal components requir ed for an organizational information system arehardware, sof tware, database, p rocedures, and operations personnel. Th es e e lem e nt s,shown below. a re d es cr ib ed i n f ur th er detail ill Chapters 3, 4. and 5.Physlc.1o:omponent DescriptionHardware Hardware rer~rs 10 phyl"" l COmi>Ulerequipment!11da.sodat"" d."'oos.

Hardware mus l p rovide ( or f iv e major r uncuons ~, I np "1 or entry2 O u tp utJ Secondo ry .[orag. l o r d a t a ono prcgrom'4 Central processor (computaUon,control. and primary otorege)5 CommunicationsSQUwIB.rflIs a broad term glven to Ihe Ins"ruc:t]ons Ihal dfrect Ihe oparanon01lhe hardware. The software ca n be ctasslfTed Into two maJo, types: systemscHwam an d application sollware.The database contains all data uti lized by appllcatlon scltwara. An tndMduaJse t o f stored data Is often referred to a. a file. The physicat existence 01stored data Is 9vlderu:ed by t he p h~ l ca l s to r ag e media (computer tapes,disk packs, diskettes. "tc.) useol for . !!


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peeeaes t :ransaclionS

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Figure 2-1. .!_~ ',,~_I''''''''''1fo

why i t is conf igured in t hat way. Another way t o describe a n i nf orma ti on s ys tem i s i nt erms o f p ro ce ss in g f un ct io ns (Fi gu re 2 -1 ). T he ma jo r processing f un ct io ns a re t hefollowing:

P ro c es s I og l u n , , !I onProeass transacilons A t ra ns a cU o n I s a n . c~ lI i1 y such as making a purohase or a sal.or ma nu la o tu ri ng a p ro d uc t. I I m e y b. Inlernal 10 !he organ izaUono r m ay InvolVe il ia olganiUl.Uon and an ,,. temal ent ity.

Pertorrnance 01 a Iran.actlon l eq ui re . r e co rd . 10 ('1) d ir ec l at r an sact io n 1 0 Iel


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S al es a nd M a rk et in g S ub sy st em sTh e sales a nd m ar ke ti ng f un ct io n g en er al ly i nc lu de s all activities related to thep ro mo ti on a nd s a le s o f p r od u ct . o r s e rv i ce s . T I ,e t ra n sa c ti o ns a r e s a le s o r de r s, p romo ti o norders , ere. The o p er a ti o na l c o nt ro l a c ti v it ie s i n cl u de the h i ri n g a n d trainiug of tile salesf o r ce , th eday - to -day scheduling o f s a le s a n d p romo ti o n e f fo r ts , and p e r iod i c ana lys es ofs al es v ol um e s b y r eg io n , p ro du ct , c us to m er , e tc . M a na ge ri al c on tr ol c on ce rn s c om pa ri -s on s o f o ve ra ll pe rf orm an ce a ga in st a m ar ke ti ng p la n. I nfo rm ar ic n f or m an ag er ia lc on tr ol m ay i nc lu de d at a o n c us to me rs , c om pe ti to rs , c om pe ti to r p ro du ct s, a nd s al esforce requirements. Strategic p la n n in g f o r t h e m a rk e ti n g f u nc t io n i n vo l ve s c o ns id e ra t io no f n ew m arke ts a nd n ew m ark etin g stra te gie s. The information r eq ui re m en ts f ors tr at eg ic p la nn in g i nc lu de c us to m er a na ly se s. c om pe ti to r analyses, c o n sume r s u rv e yi n fo rm at io n , i n come p ro j ec t io n , d emog ra p hi c p ro j ec t io n s, a n d t e ch n ol o gy p ro j ec t io n s.

I"u,~,II,"D P r od u et lo n S u b sy st emI(

Ie,~n~UItdIft . I :;i

The r es po ns ib il it ie s o f t he p ro du ct io n O r m an uf ac tu ri ng f un ct io n i nc lu de p ro du cte ng in ee ri ng , p la nn in g o f p ro du ct io n f ac il it ie s, s ch ed ul in g a nd o pe ra ti on o f p ro du ct io nfaciliti es, employment and l lainjng of p ro du ct io n p er oo nn e l, .n d q ua U ty c on tr ol andi n sp e ct io n . T y pi c al transactions 10 b e p r oc e ss e d arc p ro du ct io n o rd er s ( ba se d o n ane xp lo si on o f t he s al es o rd er s a nd i nv en to ry r eq ui re me nt s into c om p on en t p an s) ,a ss em bl y o rd er s, f in is he d p ar ts t ic ke ts , s cr ap t ic ke ts , a nd t im e- ke ep in g t ic ke ts .O pe ra ti on a l c on tr ol r eq ui re s d et ai le d r ep or ts c om pa ri ng a ct ua l p er fo rm a nc e to thep ro du ct io n s ch ed ul e a n d highlightlng areas w he re b ot tl en ec .k s o cc u r. M a na gem en tcontrol r eq ui re s s umm ar y r ep or ts w hi ch c o mp ar e o v er al l p la nn ed o r s ta n da rd p er fo r-m a nc e t o a c tu al p er fo rm a nc e f or s uc h c la ss if ic at io ns as c os t p er u ni t and labor usee.S t ra t eg ic p la n ni n g f o rm a n uf a cLU r i ng i n cl u de s a l te r na t iv e m a n uf a ct u ri n g a p pr o ac h es a n da l te r na t iv e a pp ro a ch es t o a u tom a ti o n.

U tl 0 ~ E~ " -ijo e (; e.~ 0 .3 . . c E 0I i : . Q u : >-

Strategic planning~ ~ ~ ~ ~ ~ ~

Ir II[ II[ II'-- L_ L_ L_ L- l_ L

Management control

Operational control

' r ransactton prOtessUlg

Ftgure 24The ma in > o t l u nc t lo n al s u b sy s tem n d man ag emen t se l l .I l l . . , ,

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c Higher r eq u ir em e nt s f or a c cu ra c yLi s t t b e g oo d a nd b ad r es ul ts o f th e a b ov e I ac ro rs a . t he y . ff ec . i .n di vi du .1 s w ho w or k i n t h eorgl:lnl 'Zation _Z I nf or ma ti on p ro ce ss in g I or * d, io . s up po rt will d if fe r d ep en di ng o n w he th er t he d ec is io n i ss tr uc tu re d o r u ns tr uc tu re d. E ~ pJ .i n wily t hi s i s t ru e. C ho os e o n. s tr uc tu re d d ec is io n a nd o n.un.truclured deeisjon ' 0 i Uu .l ra te y ou r exp lan e t io n ,3 B a si c r ra n sa c ti on p ro c es .i ns will always be p e rf or me d : p ro vi di ng i nf or ma li on f or s .r a. eg icp la n ni ng r na }' n e v e r o c cu r, a n d n o o ne w i ll n o ti ce . E :< p la .i n wny t hi s s t at em en t i s t ru e i n m a nyorganizations.4 T Il e C QQ C cp lI Ja Js uu ct ur e o f a n i nf or ma ti on s ys te m e nc om pa ss es a c om pl et e pcrtfclic ofa pp li ca ti on s t ha t p op ul at e a ll o f t he c el ls in F ig u ", 2 4 , In a c tu a l i rn pl cme n ta ti on , s o me c e ll sm ay n ot h av e a ny a pp l. ic at io ns , E xp la in why.5 T he t ra ns ac ti on p ro ce ss in g a pp lk ati on m us t u su al ly be d on " b ef or e o pe rn ti Qn .1 c on tr olapplications co. b e i mp le me nt ed . W ha t o rg an iz au cn al p ro ce ss es m us t t ak e p la ce i n o r de r t o

have the oecessery i np ut f or m a na g em e nt c o nr rn l a p pl ic a ti on s ?Discuss dlC advantages and di. ,.dva.nlages of ex.ending the formal, public system al~.." JlC '1 ,e o f t he fo rm al p ri va te s ys te m a nd t he i nfo nn .l p ub li c s ys te m.7 Personal computers allow individuals in an organization 10 have private files and privatesy"ems, Discuss advantages and disadvantages of this trend.As sale, m an ag er . y ou h av e been p ro vi de d w it h. p er so na l c om pu te r t ha t c an o ct a s a , om l; na JLa m e m ain c om pute r a s :P81 o f a n e le ct ro ni c m ai l n et wo rk o r a s a S Ia nd -a l o ne computer ford o in g m o de li ng , m a in t. in in g m e s, a nd w or d p ro ce ss in g, H ow m ig ht t hi s s ys te m be "o ed i nc on ne ct io n w it h y ou r p ri .O Ie v er su s p ub li c i nf or ma ti on s ys te ms , b ot b f or ma l a nd i nf or m. l?.9 A c om pa ny d ec id ed to implement a h i gh l y i n teg ra l l: < ! managemen t information system. AnyfmnS2 IC [JOn entered i nt o t he ! Sy st em would im mediately a f ie e l ; !' } ll eelated r u n c ti on a ] s ubsyste ensa t a ll t ev e ls o f a c dv ir y, T h o s ys tem w a s n e ve r i mp lem en te d s uc c es sf ul ly . Why d o y ou t hi nk itw as . f .i l. ", 1

10 Wh y i s u s e r- ma c hi ne i nt er ac ti on n e t " '' 1u .i rc d for a n i nf or ma ti on s ys te m? W hy i s it consideredv e ry d e s ir a bl e ?

SELECTED REFERENCESThe re a re a f ew n ow cl as si c r ef er en ces t hat w er e signif!c ::tIH i n t h e devel opment c f r he c once pt Or;Qmanagement i nf or ma ti on s ys te m; o th er r ef er en ce s d e s cr ib e d ou bt ' a bo ut t he c on ce pt or definep ro bl em s i n i ts i mp le me at at ic u. T he re a re a ls o s om e c ur re nt r ea di ng s [0 g 'i vc s om e b re a dt h o rb ae k ll ro u nd f or l at er c h ap te rs .Signi ficant Historical MIS Concepi ReferencesAron, 1. D.: " In fo rm a ti on S y st em s i n P e rs pe c ti ve . " Compulillg S,,,.eys. D ec em be r 1 96 9 . . p p.216-236,Blumentha l, Sherman: MafjiIg~rmml Information S)',su:ms:A Framework [or- Planl!iJlg and

DIN.topmenl, P r en t ic e -Ha l l, En g lewo od Cliffs. N J. 1 96 9,D ru ck er , P el er F. : " Wh at m e C om pu te rs wm Be Telling You, 0, NmiO"II'sBu$I'llesst Au gu s [ 1 96 6 ,pp. 84-90.Gorry, G, A., a nd M , S. Scott Merton: '''A Framewo rk for Man agement I n fo rma t lc n Syslem,."

Stoo.l ! Managemt!n.t Revieul' t F al l 1 97 1,Zani, William M.: " Bl ue pr in t f or MlS," H a rv a rd B II ,I " e s , R ev i e .. , NovemOOt-December 1970.PI'. 95-100.

Pro and Con Discuss ion of MIS Concept (Histor ical )A ck of f, R . L ,; " Ma na ge me nt M i. ;n fo nn at io n S ys te ms ." Man{lgtm.nl Sci/.ce, D e cem be r ) 96 1,

P I'. B 47 -2 1 56 .De ar den , J oh n; " Car l M an ag em en t i nfo rm ati on B e ALUOm at ed ':r ' Harvard Busi 'l~ .s;SRt:vltw,March-April 1964. pp. 128-135.D ea rd en , J oh n: " Co mp ute rs : N o Impact o n D iv is io n al C o nt ro l, " Harvard Business R. .yi"~,

J anua ry -F eb ru . ry 1967. pp. 99-1 Cl4.Dea rden , John; "MIS I, a Mir'll!c." Harvard BUS/frost Review. Janua r y- Febr uar y 1 972, pp.90-99. S L e ue r s t o E d il o, in M.y-June 1972 isue.Dearden, John: "Myth of Real-Time Management Informancn," HaTVo .r d B u s t' n rs s R ev itw .May-Jun. 1966, p p. 1 2 3- 13 2 ,W i ll , H a n J.: " MIS -M ira ge o r M ir ro r Im ag e? " Jou rna l o f S yS 'l em sMo"eg .mem , September1973, PI'. 24-3 J.

C u r re nt R c a d I n gsD ic ks on , G _ w. : "Management Infoml:a! ton Systems: evolution an d S t a tu s ," ; o Advances inCompsaers. M. Youts Ied.I, Academic Press . New York. 1981.Keen, Peter G . W ,: " 'I n . . r ac ti ve ' Ccrnpu tor Sysiems f o r Man .ger s, A Modes t Proposal," Sloon

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r eq ui re s d at a o n p la nn ed v er su s a ct ua l u ti li za ti on , e qu ip m en t c os ts . o ve ra ll p ro gr am m erp er fo rm an ce , a nd p ro gre ss c om pa re d t o s c he du le fo r p r oj ec ts t o d e ve lo p a nd i mp le me ntn ew a pp li ca ti on s. S tr at eg ic p la nn in g f or i nf or ma ti on s ys te m s i nv ol ve s t he o rg an iz at io no f t he f un ct io n (such a s c en tr a l iz e d or d ec en tr al iz ed ), t he o ve ra ll i nf or ma ti on systemp la n, s el ec ti on o f s tr at eg ic u se s o f i nf or ma ti on , a nd t he g en er al s tr uc tu re o f t he h ar dw a reand softw areenv ironrnen t. For exam ple , a major strategic decision might be toi mp le me nt m ic ro co mp ut er w or ks ta ti on s f or all a na ly st s, p la nn er s, a nd m an ag er s.

O ffice automation may be defined as a separate subsystem o r i n cl ud e d withini nf or ma ti on p ro ce ss in g. O ff ic e a ut om at io n i nc lu de s a w id e r an ge o f s up po rt f ac il it ie s f ork no wl ed ge w or k a nd c le ri ca l a ct iv it ie s. E xa mp le s a re w ord p ro ce ss in g, e le ct ro ni c m ai l,electronic flling, and data and v o i ce communi c a ti o n s.TOp Management SubsystemT he t op m an ag em en t fu nc tio n ( ch ie f executive o ff ic er p lu s s ta ff ) o pe ra te s s ep ar at el yf ro m t he f un ct io na l a re as , b ut a ls o i nc lu de s t he fu nc tio na l v ic e p re si de nt s a ct in g i n a t opm an ag em en t c ap ac it y s uc h a s i n m an ag em en t c om mi tt ee s. T he tr an sa ct io ns p ro ce ss edby t op m an ag em e nt a re p ri ma ri ly i nq ui ri es f or i nf or ma ti on a nd support o f d e c is io ns . T het r a nsa c t io n d o cumen t s, the re fo re , tend to be leuers a nd m em or an d . . R e sp on din g t o t heinquiries and m altin g d ec isio ns re qu ire s e ith er a cc es s to m e d ata bas e and decisionmodels of the organ ization or transm itta l of the requests to o ther parts of theo rg an iz at io n. T he i nf orm at io n f or o pe ra ti on al c on tro l i n t he t op m an ag em en t fu nc ti oni nc lu de s m e et in g s ch ed ul es , c or re sp on de nc e c on tr ol f il es , a nd c on ta ct f il es . M a na ge ri alc on tr ol b y t op m an ag em e nt u se s i nf or ma ti on w h ic h s um m ar iz es t he m an ag em e nt controlbe i ng ex e rc i s ed by o th er fu nc tio ns t o e v al ua te w he th er t he fu nc tio ns a re p er fo rm in g a sp la nn ed . T hi s re qu ire s a cc es s t o t he p la ns and a c t ua l p e r fo rmanc e of a l l t h e f un c ti on s .S tr at eg ic p la nn in g a ct iv it ie s r el at e to m at te rs s uc h a s d ir ec ti on o f t he c om pa ny (w hi chb usin es s it sh ou ld b e in) a nd p la ns fo r e ns uring n ec es sa ry res ou rce s, T he s trate gydetermined by lOp m an ag em e nt s et s t he f ra me w or k f or s tr at eg ic p la nn in g w i th in f un ct io nand also c oo rd in at es p la nn in g t o r e m ov e m a jo r i nc on si st en ci es . S tr at eg ic p la nn in g a t t h et op m an ag em en t l ev el r eq ui re s a w id e v ar ie ty of s um m ar iz ed e xt er na l a nd i nt er na l d at a.I nf or ma ti on s ys te m s up po rt f or s tra te gic p la nn in g m ay i nc lu de a d h oc re tr ie va l o f d at a,a d hoc a na ly se s, a nd d ec is ion s u pp o rt ' sy s tem s.

EXTERNAL INFORMATION DOMINATES EtSI n t h edasign o f an execut ive i nf orma ti on sy. tem (EIS) f or ! he chief o ft icer . o f a l a rge regionalb anking sys lem. t he requi rement s we" , d om inat ed by ext .rna l i nf orma ti on nOI p roduced by!he transaction system 01 dala processing. Exampl e .s 01 external in'mmallan requirementsWi3r1; :1, :

C om pe t it .o r information R ag uU o/ y Inlormalion Reg iona l e conomic ind icat ors Cuslom.r prelere nOIlS for . .. Mces O ua li ly of services being provided

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SYNTHES!S OF A MANAGEMENT tNFORMATtON SYSTEMSTRUCTURE'The MJS structure has been described in terms of suppor t for decision making,m an ag em en t a ct iv it y, a nd o rg an iz at io na l f un ct io ns . T he se t hr ee a pp ro ac he s w il l n ow b es yn the siz ed in to a m an age me nt in fo rm ation s yste m s tru ctu re . T his is " s entia lly c on ce pt ua l f ra me w or k w h ic h a ll ow s one t o d es cr ib e a n e xi st in g o r p la nn ed informations y st em. T h er e is also a p hy si ca l s tr uc tu re w h ic h d ef in es t he w ay a n M IS is implemented.

Conceptual StructureThe conceptual structure of a m an ag em en t i nf or ma tio n s ys te m i s d e fi ne d a s a federationo f fu nc tio na l s ubs ys tem s, e ac h of w hic h is d iv ide d in to fo ur m ajo r in fo rm ationp r o ce s s i ng componen t s: transacricn p r o ce s s i ng , o pe ra t i on a l control i nformation systems up po rt , m a na ge ri al c on tr ol i nf or ma ti on s ys te m s up po rt , a nd s tr at eg ic p la nn in g i nf or ma -t io n s ys te m s up po rt . E ac h o f th e f un ct io na l s ub sy st em s o f t he i nf orm at io n s ys te m h ass om e u ni qu e d at a f li es w hi ch a re u se d o nl y b y t ha t s ub sy st em . T he re a rc also,files whichneed 10 b e a c ce s se d by m or e t ha n o ne a pp li ca ti on a nd n ee d t o b e a va il ab le f or g en era lretrie val. T he se files are o rga niz ed in to a g ene ra l d ata ba se m an ag ed by a d atab as em a na ge me nt s ys te m .A f ur th e r am p li fi c at io n of th e s tr uc tu re i s t he i ntr od uc ti on o f c omm on s of tw a re . Inaddition 10 ap plica tio n p rog ra ms w ritten es pe cia lly for ea ch s ub sys te m. th ere a rec om mo n a pp li ca ti on s w hi ch s erv e m ul ti pl e f un ct io ns . E ac h s ub sy st em h as l in ka ge s t ot he se c om m on a pp li ca ti on s. ' Th er e a re a ls o many a na ly ti ca l a nd d ec is io n m od el s t ha i c an

UnIque 10appncancnCommon. to rn,any

applIcatIons

M. no gement c e nt r c I Modalbase

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StrategIC plannIng

Commonapplications:;oflware

OperatIonal contrOl

Transact,on prooesslng

Unique subsyslem fIles

Da ta . b e s a m i3 rLagerne rlt system

C ommo n d al a b a se

F i gu re 2 - 5The Information subsystem for 8 function ( su ch a s markoting or product ion) .


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Fluwe 2-6Tl M Clllii!lnizilllonal MIS,


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' FT 9 Ur o 2 - 8The managem.nt Information"Y'!em as a pyramid.g oo d e x am p le i s a n o rd er e n tr y s ys te m . T Il e r e c or di ng o f a n o rd e r i ni ti at es asequence ofp r oc e ss in g , e a ch s te p using n ew d at a b ut a ls o much of the data f rom p ri o r p r oc e ss in g .The majo r steps in a typical sequence are:Step

O r d er . c i< n owl e d. gm en lNew d . ! " .n !e r ed Documents producod

Order enlry

ShIPpingInvoicing

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F u nC I i on s u bs y st e msStrategic plannlnq

VAWf----

Mallagement control

o p e ra t i on . I co n t ro t

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C om m o n m od u Ie iose n ed l or called I DVa I I p r og r a m s n e e d i n . g t h e funct ion

Figure 2-10Use 01 common rnodul as In physical strucnna of MIS.i nf or ma l i nf or ma ti on s ys te m s, m a na ge r r es is ta nc e 10 f or m al l nf or ma tl on s ys te m s, t hee x te nt o f i nt eg ra ti on o f f il es an d p ro ce ss in g, t he e xt en t o f u se r- ma c hi ne i nt er ac ti on , an dgeneralized VsrSUB i n di v id u al iz e d s y st ems .

F o rm a l v er su s l nforma! Inform allDr) SystemsTo e managemen I i n fo rm a ti on s ys te m a s d es cr ib ed i n this chap ter encompasses on Iyparro f t he t ot al i nf or ma ti on p ro ce ss in g t ha t t ak es p la ce i n a n o rg an iz at io n. T he c om pl et ei nf or ma ti on p ro c es si ng s ys te m o f an o rg an iz at io n c on si st s o f b o th p ub li c s ys te m s andp ri va te s ys te ms . . "P ub li c" i s u se d i n t he s en se o f b e in g k no wn t o r e le va nt p er so ns i n t heo rg an i~a . li on and a va i la b l e t o a ll w ho h av e a ut ho ri ty t o a cc es s t he i nf or ma uo n. P Mv at es ys te m s a re k ep t b y i nd iv id ua ls . T h es e m a y s up pl em e nt Of d u pl ic a te t he p u bl ic s y st ems ,a nd t he y m ay be u n s an c ti on ed a nd d is co u ra ge d o r s a nc ti on e d a nd e nc ou ra ge d. T h er e a rew it hi n t he p ub li c a nd p ri va te s ys te m s b o th f or ma l a nd i nf or ma l i nf or m at io n s ys te m s. T I, ef or ma l i n- fo rm a ti on s y st e Ell is m an i f es te d b y d oc um en ts a nd o the r re co rd s, u su all yl n di c au n g c ompl i an c e w i th p r es pe c if re d r u le s a n d p r oc e du r es . . Th e i n fo rm al i n fo rm at io ns ys te m m ay p ro ce ss i nf or ma ti on t ha t is v it al t o o rg an iz at io na l f un ct io ni ng b ur w i th ou tf or ma l r ec or ds o f t ha t p ro ce ss .

T he m an ag em en t i nf or m a tl 0n s ys t e rn d ef in ed i n t hi s c h a pt er , w i t ll i ts p re sp ec if ie dp rc ce d u re s a nd p ro gr a r ns f or a pp li ca ti on s ,. i s p ar r o f t he f or ma l pub) ic system 1t iso r ga n iz a ti o na l ly p u bl ic a n d a c ce s s is d ep en de nt o nl y u po n b av io g a pp ro pr ia te o rg an i" a-t io na l a ut ho ri ty t o e n te r o r r et ri ev e d at a o r t o r ec ei v e r e po rt s o r i nq ui ry r es po ns es . T he rei s a ls o a n i nf or ma l p ub li c s ys te m t ha t s er ve s a ll p er so ns i n t he o rg an iz a ti on w ho c on ne c tw ith it. T he in fo rm al syst em 11 M f ew p re de te rm in ed r ul es . E xa mp le s o f t il e p ub l i ci nf or ma l i nf or ma ti on s ys te m a re e le ct ro ni c m ai l, t el ep ho ne c al ls , c on ve rs at io ns a t

g at he ri ng p oi nt s s uc h a s t he w a te r c o ol er , D o te s o n t he b ul le ti n b oa rd , a rt ic le s a n d o th erp ub li ca ti on s d is tr ib ut ed i n t he o ff ic e ( pe rh ap s a nn ot at ed ), a nd p re se nt at io n s b y e xt er na li n fo rm at io n SOU rc e s such as salesrepreseruanves.

I n a dd it io n t o t he se f or ma l a nd i nf or ma l p ub li c s ys te ms , m an y p ri va te i nf or ma ti ons ys te m. t en d t o e xi st in o rg an iz at io n s. S om e 0r t he se a re q u it e formal, .a.t I e a s t f or t hei nd iv id ua l o w ne r a nd a ny s up po rt s ta ff w ho h el p m a in ta in i t. F or e x am pl e. a n i nd us tr ia ls al es m a n" g" r r ni gh r m a in ta in a s e p ar at e f il e o f p e rf or ma nc e d a ta o n s al es r ep re se nt at iv eswhich B h e u se s t o " ug me nt t he i nf or ma ti 0n r ec ei ve d f ro m t he form 31s a l es in f o rma t ions y


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PRIVATE, FORMAL SYSTEM TO TRACK ADMISSIONSThO'Gradusis F'rog r am Ofl lc a keeps tne lorma l pub li c mee on ,al l s iudenl " who o,pply loradmission 10!hedoel,oraJprogram of the School01Man.yement_ IIs omeonewho isaUlllon.adwanls 10look atan appllesn!' . nra,lhay have iI_ However , they keep no records on applicantsby program, The MIS area s ec re t a ry h as a p nva te !o!Tllal'Y5Iem. (\nyone whowan t s "Iracklngd at a" a sk s h er . I t i s h e r p ri va te s ys 'l em ; I f s he l ea ve s, it ls u n lJ k el y t h e s y st e m w O u ld perstst,There Is no lormal cocumantanon,A s s h ow n i n F i gu re 2 -1 1, t he p ub li c i nf or ma ti on s ys te m o f a n o rg an iz at ic n t en d s 1 0 be

l ar ge r t ha n t he p ri va te s ys te m , b u t t he t ar te r i nc lu de s a S ig ni fi ca nt p or ti on o f o rg an iz a -t io na l i nf or ma ti on f lo w s, T he e ff ec t o f a c o mp re he ns iv e i nf or ma ti on s ys te m o f t he t yp ed es cr ib e d i n t hi s chapteris 10 i nc re as e t he s co pe o f t he f or ma l, p ub li c s ys te m. T hi si nc re as e r ed u ce s t be n ee d f or p ri va te , f or m al s ys te m s a nd p ro ba b ly r ed uc es t he n e ed f orboth p ub li c a nd p ri va te i nf or ma l s ys te ms . O ne a dv an ta ge o f t he f or ma l p ub li c s ys te mo ve r p ri va te i nf or ma ti on S Y Sl em S is t ha t i t b e l on gs t o t h e p os it io n r at he r t ha n t he p er so n,s o t ha i w he n a n ew p er so n c om e s i nt o a p os it io n h e o r s he w il l h av e i n p la ce t he n ec es sa ryi nf or ma ti on s up po rt t o f un ct io n i n l hm p os hi on ,

I nc re as in g t he s co pe o f t he p ub li c f or ma l s ys te m a ls o h as a ss oc ia te d c os ts . T he re a ret he c o st s o f e l i ci ti ng r eq u ir em e nt s. d es ig ni ng t he s ys te m , p ro gr amm in g, t es ti ng , a n dw ri ti ng p ro ce du re s f or o pe ra ti ng a nd u si ng t il e s ys te m, B ec au se o f t he h ig h c os t o fd ev e lo pi ng s ys te m . th e t en de nc y h as b ee n t o o n ly a u to m at e s ys te m s t ha t c a n b e j us ti fi eda s p u b li c s ys te m s s o t h at t he c os ts a re s ha re d o ve r m a ny u se rs . H o we ve r, t he t re nd t o e n du se r c om pu tin g, a s d esc rib ed in C ha pte r I , m ea ns u se rs ha ve a cc ess to te rm in als o rp e r- s on a l c ompu t er s a n d p ow er fu l a p pl ic 3 li < ;> nd e ve l opment l a ng u ag e s w h ic h f a dl it a lch av in g t he m d ev el op t he ir o wn s ys te ms . M an y a pp li ca ti on s d ev el op e- d b y u se rs O np er so na l c om p Ul er s a re h ig hl y i nd iv id ua li ze d, a nd a re t hu s f or ma l, p ri va te s ys te m s.

T he re i s o n go in g d eb at e a s t o h ow m uc h o rg an iz at io na l i nf or ma ti on p ro ce ss in g c ane ffe ctiv ely b e m ad e pa n o f the fo rm al sy ste m a nd ho w m uc h sho uld re ma in in theinfo rm al system s, 11 c an be argued thai m any im portant decisions are based o ni n fo rma t io n r e ce i ve d t hr o ug h i n fo rma l c h an n el s t h at c a n no t be f o rm a li z ed , e s pe c ia l ly a tt op m an ag em en t l ev el s, A w el l- kn ow n s tu dy h y M in tz be rg '' s ho ws ! ha t a s m uc h a s 80pe rc en t o f a c hie f e xe cu tiv e's tim e is sp en t io v erb al c om mu nle atic n. A stu dy o fi n fo rma t io n s ys tem s man ag e rs by Iv es a nd O lso n' sho we d a sim ila r pa tte rn . T his ise sp ec ia ll y n ot ew o rt hy b e ca us e t he se m a na ge rs c an no t b e s ai d t o b e u nf nm il i ar w it h l hec ap ab il it ie s o f t he f or ma l, p ub li c i nf or rn a ti on s ys te m ,

A dv oc at es o f i nc re as in g [ he s co pe o f t he f on na l p ub li c s ys te m c la im t ha t if i t c anr ed uc e t he t im e s pe nt b y m a na ge rs i n i nf or ma l c omm un ic at io n, t he ir p ro du ct iv it y w il li nc re as e a nd t hu s b en ef it t he o rg an iz at io n. S ke pt ic s o f t hi s v ie w c la im t ha t t he o nl yinformatjon s ys te ms I ha l w il l a ff ec t m an ag er ia l p ro du ct iv it y a re e nh an ce me nt s 1 0i nf or ma l s ys te ms s uc h a s e le ct ro ni c m ai l a nd t o f or ma ! p ri va te s ys te ms s uc h a s u se r-d ev el op ed d ec is io n u pp or t s ys te ms , T hi s d eb at e will b e c on si de re d a ga in i n l at erell.pters.

"Hen ry M in r zberg . The Namre ofMal/oguinl Work, Harper & R ow , N e w Y o rk , 1 97 3,'s. l v es a n dM , H . O l so n , "M ana g er o r T e c h n ic i an " )T h e NOlO'" o f th o In fo rma tion Sy s temM"n.~"r"s Job," MIS Q"arr.,ly, 5,4, December 1 98 1 p p. 49-63.

Exlen t 01 Integ rationS om e a dv oc at es o f " to ta l s ys te m s" h av e a rg ue d f or c om pl et e i rr re gr au nn o f a ll f or ma lin f orma t ion p roces s ing . The experience 10date s u gg e st s [ ha t .such" l i g ht ly in t eg r a tedsystem is irnpractical. T here are too m any fa ctors to consider all at once, andm a in te n an ce i s d if fi cu lt . F or [ hi s r ea so n , i nf or ma ti on s ys te m s t en d t o h av e a m o du la rd es ig n w it h i nt eg ra ti on o n ly w h er e r eq ui re d (as i n t he o rd e r e nt ry s ys te m e xam pl e) ,I nc on si st en ci es a m on g s ub sy st em s a re r ed uc ed b y t he u se o f s ta n da rd s a n d m e c omm ondatabase.

D ata in te gra ti on is a cc om plishe d b y the u sc o f a c om mo n d ata ba se . A c om mo nd ata ba se d oe s n ot n ec essa rily e lim in ate the n ee d fo r se pa ra te flie s. S om e fi le s a reS i gn i fi c an t o n ly t o On e a pp li ca ti on a nd t he re fo re m a y be d es ig ne d f or a nd m a in ta in ed b yth a t ap p li ca ti on .D a ta r eq ui re m en ts f or d if fe re nt l ev el s o f rnanagementactiviry a ls o s ug ge st t he n ee df or m or e t ha n o ne d at ab as e r at he r t ha n c om pl et e i nt eg ra ti on , F or e xa mp le , t he d at ac cl le ct ec f ro m e xt er na l s ou rc es a nd s to re d f or s tr at eg ic p la nn in g i s s o d if fe re nt f ro min ler n a .! d at a f or o pe ra ti on al c on tr ol I h. 1 s om e d if fe re nt d at ab as es m ay be des irable.

Exlent of User-Machine Interact ionT he i nf or m at io n s ys te m s tr uc tu re d oe s n o t s p- e- ci fy o nl in e u se r- m ac hi ne i nt er ac ti on ; i ti nd ic at es o nl y s up pa n f or v ar io us o pe ra ti on al a nd m an ag em en t a ct iv it ie s. O nl in ep ro ce ss in g o f t ra ns ac ti on s i s o ft en d es ir ab le b ec au se t he t ra ns ac ti on i s c om pl et edi mm e di at el y, I nq ui ri es a re g en er al ly m o re e tf ec uv e i f i mm e di at e r es po ns e i s a v a il ab le .T he u se o f a n a ly si s, p la nn in g, a nd d ec is io n m o de ls i s f re qu en tl y e nh an ce d if t h e ana lys t ,p la nn er , o r d ec is io n m ak er c an i nt er ac t d ir ec tl y w it h t he c om pu te r p ro gr am , a sk in g.. w ha t if" q ue st io ns d urin g p ro ble m a na lys is, W ith (he d ec re asin g c os ts o f b othc om p ut er a nd c omm un ic at io n s t ec hn ol og y, t he t re nd i s t o o nl in e i nt er ac ti ve p ro ce ss in gf or b ot h t ra ns ac ti on p ro ce ss in g a nd d ec is io n s up po rt s ys te m s.

T he c om p ut er s ys te m t ha t s up po rt s o nl in e t ra ns ac ti on p ro ce ss in g m a y n ot b e a bl e t oSUppO!1 l nr er ac ri ve m o de ls . H o we v er , h av in g a n l nf or ma ti on s ys te m d o es n o t i m p ly t ha ta s in gl e c om pu te r s ys te m m us t b e u s ed , A n o rg an iz at io n m ay u se ii, i n -hous e compute rro r t ra ns a ct i on p ro ce ss in g b ut pro vid e a lte rn ati v es fo r ir ne ra cu v e m od e I s s ue t. a sp ro vi di ng a s ma ll i n- ho us e i nt er ac ti ve s ys te m, r en ti ng l im e o n a n o ut si de c om pu te rt hr ou gh t im e sh ar in g, O r p ro vi di ng p er so na l c om p ut er s. T he se a pp ro a ch es e nc ou ra gem a ringers and s t a ff s p eci a l is t s 10d ev el op t he ir Ow n s u pp or t m o de ls , r at he r t ha n d ep en d-i ng o n t he s ta ff o f t he i nf or ma ti on p ro ce ss in g f un ct io n t o p ro vi de t he m.

SUMMARYT h is c ha pt er h as d ef in ed a c on ce pt ua l s tr uc tu re f or a man ag emen t i n fo n n at io n s ys tem .An a c tu a l o r ga n iz a ti o na l i n fo rma t io n s ys tem will d if fe r f ro m t hi s m o de l b ec au se c er ta ine le me nts a rc n or c ost-ju stifie d o r b ec au se th e im ple me nta tio n is pe rfo rm ed in a ne vo lu ti on ar y m an ne r r at he r t ha n a ll a t o nc e,

T he i nf or ma ti on s ys te m m ay be d es cr ib ed i n t er ms o f i ts o pe ra ti ng e le me nt s. l isp hy si ca l c om po n en ts a re h ar dw a re , s of tw a re , d at ab as e, p ro ce d ur es , a nd p er so n ne l, l is


17/17

p ro ce ss in g r eq ui re me nt s, a re t o p ro ce ss t ra ns ac ti on s, m ai nt ai n m as te r f il es , p ro du cer ep or t s" p roces s inquiries", and p roces s interactive s up po rt a pp li ca ti on s. T he o ut pu ts f orusers are transaction documents, preplanned reports , preplanned i nqui r y r e sp on .s e~ , adh oc r ep or ts a nd i nq ui ry r es po ns es , a nd u se r- ma ch in e d ia lo g r es po ns es , T he se p ro vi dem a na geme nt a nd o th er d ec is io n m a ke rs w it h m on it or in g i nf or ma ti on , a ct io n i nf cr ma -l io n, a n d d e c is i on s up po r t. i n fo rm a ti .o n c a n b e p ro v i de d f o r b o t h s tr u ct ur e d, p ro g ram r na -b le d ec is io ns a nd unstructured, nonprngrammable decisions.M a na gem em i nf or ma ti on s ys te m s tr uc tu re i s a ff ec te d b y r na na ge rq er u a et iv it y a ndorganlzarional function. Information requirements vary w it h t he l ev el o f m a na geme nt"eli vity supported: strategic pi ann iIlg, managerial centro I, Of operatic naI c on tr ol . T he yalso vary depending on the degree of s truc tu re o f the dec is ion s up po rt ed . E ac horganizau 0n al fu nc t io n su ppo rted b y the in fo rm al ion sys te rn b as its o w n u rtiq uei n fo rm a t ion p ro ce ss i og r eq ui re me nt s a s well as so me wh i ch a re com men to severalfunctions.

T he c on ce ptu al stru cta re o f a n in fo rm ation syste m c on sists o f n fC dl!ralio n o fin f orm at io n s ub s ys t er n s J o r cli f fe r en t f un ct io ns . E ac h s ub s y s te rn p ro vi de s s up p o rt f or

. t ra n sa c ti o n p ro c es si n g, operational c on tr ol , m an ag em e nt c on tr ol , and s tr a te gi c p la n -n in g. S om e t yp ic al s ub sy st em s m ig ht b e m ar ke ti ng , p ro du ct io n, l og is ti cs , p er so nn el .f ina11ce and ac coun ti ng, i n fon1 la t i, on s yst em s, a nd t op m an ag em en t. T he c on ce pt ua ls tr uc tu re i nc lu de s s om e u ni qu e f il es f or e ac h s ub sy st em p lu s a c omm on d at ab as e. T he rej s un iq ue software for each subsystoen, and therc ls common software used by Oravailable 10 all subsystems-ee databas e management system, c omm on s of tw ar eroutines, and a model b as e o f a na ly si s, planning, and decision models .

S om e i ss ue s o f M I S s tr uc tu re a ro un d w hi ch t he re i s 311 ongoing debate a r e th eex tento f t he f or ma l i nf or ma ti on s ys te m v er su s i nf or ma l s ys te ms , t he e xt en t o f i nt eg ra ti on o fp ro c e: ;s io g a n d d a ta , and t he e xt en t o f u se r- ma ch in e interaction.

MINICASESI TIME TO REVIEW

T he G BD C om pa ny h as h ad a c om pu te r f or se ve ra l y ea rs a nd h as a dd ed a pp lic atio ns b ase do n t h e p o~ r OT p er su as io n o f e xe cu tl v es o f d if fe rc nr f un ct io ns , T he y n ow w is h 10 e xa m i ne t he i rs ta tu s r el a u ve t o t he c on ce pt o f a m an ag em en t l nf or ma tl on sysie m. Th" follow i n ll i s the tt,t(portfol.io}of applications currently on the system fer sales and markelingT I1tt1)Unlln,g andfi I l J . 1 nee I p ro d u ct io n , a nd infctmMiQn, systems.PayrollAccounts r eeei . . ..hleCompetitive i n I . el lgence no te sA c co un t. p ay ab leD a ta p ro c es s i l \gerror logDaily cash reportWeek. ly p r od e c t lo n sched ul eC o mp el it iv o p c si ti on "n.I~C " ,s i ng < I TOr r e po r t

Questionsill C I a s . : ! : i I y t he se a pp uc a tl on s a c co rd in g t o t he m n na g em e nr lnJOrTtl81lonsystem conceplui l l model.b If the ap'pnc.a~ions: reflect t he a re as w he re information is mo s t n e ed e d . what c ar l y ou s ay a bo ut

t he natur e o f the bu sines> and the fac lo rs c ri t] col to is success?e A ssum ing tha t the m ost critical s uc c es s f a cr or ror Ill" company i,on-time delivery of highq,ualJty products. where i.. theconceptual model should furore 'pplk.tions bedeveloped?

] ; THE COMPUTER !N THE RESTAURANTT he In sta lla tio n o f a m in ic om pu te r- ba se d in fo rm ati on . sy :su ;m h as e na bl ed Dililcy'iR e't .l im n! i n A tl an ta 1 0 s tr ea ml ln e t he ir o pe ra ti on s a nd p rc rn ot e t ig ht '" internal c on tr ol s o ve rtheir business,A waiter UtiW a n o r de r a t a t ab le , a nd lnen e nt er s IL00Jl i n e ' " LaOD eo r t he s i; l' i. erminals locatedln t he r es ta ur am d in in g r oo m. T he Older is rt ; tutL":::d'o a p rin ter in me a pp ro pr la tc p re pa ra ti on a re a:t h e c o ld - It em p r in t er if h i s a s al ad , t he h ot -i te m p ri nt er I I i t i s a h OI s a nd wi ch , o r t he b ar p ri nt er ifit ls u dr ink. A custom er 's rn~ 211 ch eck listing [he items ord er ed and the respective prices isauiomaucatly generated. Thi . ' o r i l or in&systom eliminate, thecld lil~-c.mon-copy guestchecks ys te m a s w e l l a s , an y p ro bl em , c au se d by a waiter'. h an dw r it in g. W h en Ih. kitchen runsoui o r .road i tem. the conks send an "out of 'lock" message. which will be d;'p.l.yed on the diningr oo m r en ni n a ls w he n w alt er s u 'Y to o rd er [hal it em . T his g iv es t he w ai t c rs raster feedback,en.bl ing them roglve bener '.IV lee 10 [I'e cusromers.O th er s ys te m t teres aid rn a" ' gem.n , in the planni n g a nd c on tr ol 0 [ Ih .i , r e st au ra n t.business. The system provides up-to- the-minura l n r o ' r r n _ a t l o n on the fuQd items ordered andbreaks curpercentsges ,how;ng s.les o f e a ch item v e r su s t ot al , .1 ", . T h; . hel ps managemen tp io n menu s a t

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