ASSIGNMENTS - MBA – II SEMESTER

MB0031
SET 1

MANAGEMENT INFORMATION SYSTEMS

Q.1:- a. Explain the impact of MIS in the area of police Information

system.
b. What are the functions and disadvantages of MIS?

Ans:- MIS is an Information system which helps in providing the management of an

organization with information which is used by management for decision making.

A management information system (MIS) is a subset of the overall internal

controls of a business covering the application of people, documents, technologies, and
procedures by management accountants to solving business problems such as costing a
product, service or a business-wide strategy. Management information systems are
distinct from regular information systems in that they are used to analyze other
information systems applied in operational activities in the organization. Academically,
the term is commonly used to refer to the group of information management methods
tied to the automation or support of human decision making, e.g. Decision Support
Systems, Expert systems, and Executive information systems.

During the period of preindustrial revolution most of the data processing was done manu
ally.It was after the industrial revolution that the computers slowly started replacing
manual labour. The modern digital computer was basically designed to handle scientific
calculations. During the period 1940 to 1960 computers were commercially used for
census and payroll work. This involved large
amount of data and its processing. Since then the commercial application exceeded the
scientific applications for which the computer were mainly intended for. MIS is an
Information system which helps in providing the management of an organization with
information which is used by management for decision making.

Impact of MIS MIS has a major impact on the functions of any organization. The
organization derives benefits from the systems in the following form:
(a) Speedy access to information,
(b) Interpretation of data,
(c) Quick decisions,
(d) Speedy actions,
(e) Increased productivity and thereby increase in the profit
(f) Reduced transaction cost
The usage of Electronic media for data storage and processing the data is an inte
gral part of MIS. The texts and images in electronic forms are effective in
communicating ideas from source to destination. It is technology driven in the
sense it revolves around wireless electronic gadgets, internet, money cards –
credits cards, debit cards, id cards, atm cards etc.
MIS is very significant in modern day education system where we come
across usage of LCDs, Smart

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boards, internet etc in class rooms. In the tourism MIS has led to radical
changes in booking system, tourist information system, hotel facilities,
accommodation facilities, transportation modes available, images of the facilities that
could be provided etc.

Transportation
Teaching planning
methodology

Better Tourists Office

Information automation
MIS

Increased
Production
Better Banking
system

Function of MIS The main function of MIS is to help the managers and the executive
s in the organization in decision making.

1. Large quantities of data like customers information, competitors

information, personnel records, sales data, accounting data etc is collected
from internal sources like the
company records and external sources like annual reports and publications.
2. The collected data is organized in the form of a database.
3. The data from the database is processed and analysed by using
different tools and techniques.
4. The results of the analysis is properly presented to the managers to help
them in decision making.

Disadvantages of MIS

1. Highly senstive requires constant monitoring.

2. Budgeting of MIS extremely difficult.
3. Quality of outputs governed by quality of inputs.
4. Lack of flexiblity to update itself.
5. Effectiveness decreases due to frequent changes in top management
6. Takes into account only qualitative factors and ignores non-qualitative
factors like morale of worker, attitude of worker etc...

Q.2:- a. Write a scenario which shows the applications of OLAP systems.

b. How does Information technology influence the organization ’s goals?

Ans:- Online Analytical Processing (OLAP) OLAP refers to a system in which there
are predefined multiple instances of various modules used in business applications. Any
input to such a system results in verification of the facts with respect to the
available instances. A nearest match is found analytically and the results

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displayed form the database. The output is sent only after thorough verification
of the input facts fed to the system.

The system goes through a series of multiple check of the various parameters use
d in business decision making.
OLAP is also referred to as a multi dimensional analytical model.
Many big companies use OLAP to get good returns in business. The querying process of t
he OLAP is very strong. It helps the management take decisions like which month would
be appropriate to launch a product in the market,
what should be the production quantity to maximize the returns,
what should be the stocking policy in order to minimize the wastage etc.

Demand

Region

Sales

Model of OLAP
IT influences Organizations goals There is always a mention about what IT contributes to
corporate strategy. It was recognized that corporation achieved a
significant competitive advantage by adopting suitable IT concepts in building

While many people think of decision support systems as a specialized part of a

business, most companies have actually integrated this system into their day to day
operating activities. For instance, many companies constantly download and analyze
sales data, budget sheets and forecasts and they update their strategy once they
analyze and evaluate the current results. Decision support systems have a definite
structure in businesses, but in reality, the data and decisions that are based on it are
fluid and constantly changing.

Types of DSS

Data-Driven DSS take the massive amounts of data available through the company's
TPS and MIS systems and cull from it useful information which executives can use to
make more informed decisions. They don't have to have a theory or model but can "free-
flow" the data. The first generic type of Decision Support System is a Data-Driven DSS.
These systems include file drawer and management reporting systems, data

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warehousing and analysis systems, Executive Information Systems (EIS) and Spatial
Decision Support Systems. Business Intelligence Systems are also examples of Data-
Driven DSS. Data-Driven DSS emphasize access to and manipulation of large databases
of structured data and especially a time-series of internal company data and sometimes
external data. Simple file systems accessed by query and retrieval tools provide the
most elementary level of functionality. Data warehouse systems that allow the
manipulation of data by computerized tools tailored to a specific task and setting or by
more general tools and operators provide additional functionality.

Data-Driven DSS with Online Analytical Processing (OLAP) provide the highest
level of functionality and decision support that is linked to analysis of large collections of
historical data.

Model-Driven DSS A second category, Model-Driven DSS, includes systems that use
accounting and financial models, representational models, and optimization models.
Model-Driven DSS emphasize access to and manipulation of a model. Simple statistical
and analytical tools provide the most elementary level of functionality. Some OLAP
systems that allow complex analysis of data may be classified as hybrid DSS systems
providing modeling, data retrieval and data summarization functionality. Model-Driven
DSS use data and parameters provided by decision-makers to aid them in analyzing a
situation, but they are not usually data intensive. Very large databases are usually not
needed for Model-Driven DSS.

Model-Driven DSS were isolated from the main Information Systems of the
organization and were primarily used for the typical "what-if" analysis. That is, "What if
we increase production of our products and decrease the shipment time?" These systems
rely heavily on models to help executives understand the impact of their decisions on the
organization, its suppliers, and its customers.

Knowledge-Driven DSS The terminology for this third generic type of DSS is still
evolving. Currently, the best term seems to be Knowledge-Driven DSS. Adding the
modifier “driven” to the word knowledge maintains a parallelism in the framework and
focuses on the dominant knowledge base component. Knowledge-Driven DSS can
suggest or recommend actions to managers. These DSS are personal computer systems
with specialized problem-solving expertise. The "expertise" consists of knowledge about
a particular domain, understanding of problems within that domain, and "skill" at solving
some of these problems. A related concept is Data Mining. It refers to a class of
analytical applications that search for hidden patterns in a database. Data mining is the
process of sifting through large amounts of data to produce data content relationships.

Document-Driven DSS A new type of DSS, a Document-Driven DSS or Knowledge

Management System, is evolving to help managers retrieve and manage unstructured
documents and Web pages. A Document-Driven DSS integrates a variety of storage and
processing technologies to provide complete document retrieval and analysis. The Web
provides access to large document databases including databases of hypertext
documents, images, sounds and video. Examples of documents that would be accessed
by a Document-Based DSS are policies and procedures, product specifications, catalogs,
and corporate historical documents, including minutes of meetings, corporate records,
and important correspondence. A search engine is a powerful decision aiding tool
associated with a Document-Driven DSS.

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Communications-Driven and Group DSS Group Decision Support
Systems (GDSS) came first, but now a broader category of Communications-Driven DSS
or groupware can be identified. This fifth generic type of Decision Support System
includes communication, collaboration and decision support technologies that do not fit
within those DSS types identified. Therefore, we need to identify these systems as a
specific category of DSS. A Group DSS is a hybrid Decision Support System that
emphasizes both the use of communications and decision models. A Group Decision
Support System is an interactive computer-based system intended to facilitate the
solution of problems by decision-makers working together as a group. Groupware
supports electronic communication, scheduling, document sharing, and other group
productivity and decision support enhancing activities We have a number of technologies
and capabilities in this category in the framework – Group DSS, two-way interactive
video, White Boards, Bulletin Boards, and Email.

The five levels Scott Morton proposes five levels of complexity at which
reconfiguration can be applied. The following five levels indicates how it is possible to
reconfigure strategic information system based on the influence of IT.
1. Localised exploitation This is part of the Evolutionary level and exist
s within individual business functions. It addresses the local efficiency and
effectiveness of a information system.

2. Internal integration
This is part of the evolutionary level and exists between different systems
and applications. It evolves out of rationalization using a common IT
platform. Efficiency and effectiveness are enhanced by coordination
and cooperation within the enterprise;

3. Business process redesign This is part of the revolutionary

level. It involves more thorough reevaluation of the enterprise valuechain and the
production process.

4. Business network redesign This is also part of the

revolutionary level. It
involves reconfiguration of the scope and tasks of the business network. It also
helps in the creation and delivery of products and services. Coordination and
cooperation extend, selectively, beyond the enterprise's boundaries; and

5. Business scope redefinition It is also part of the revolutionary level

. It involves migration of functions across the enterprise's boundaries. It may
change the organization's conception of the business.

Scott Morton's Five Levels of ITInduced Reconfiguration (Scott Morton 1991)

(b) Software Development Life Cycle (SDLC)

India Outsourcing > Software Development Life Cycle

As in any other engineering discipline, software engineering also has some

structured models for software development. This document will provide you with a
generic overview about different software development methodologies adopted by

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contemporary software firms. Read on to know more about the Software Development
Life Cycle (SDLC) in detail.

Curtain Raiser Like any other set of engineering products, software products are
also oriented towards the customer. It is either market driven or it drives the market.
Customer Satisfaction was the buzzword of the 80's. Customer Delight is today's
buzzword and Customer Ecstasy is the buzzword of the new millennium. Products that
are not customer or user friendly have no place in the market although they are
engineered using the best technology. The interface of the product is as crucial as the
internal technology of the product.

Market Research A market study is made to identify a potential customer's need.

This process is also known as market research. Here, the already existing need and the
possible and potential needs that are available in a segment of the society are studied
carefully. The market study is done based on a lot of assumptions. Assumptions are the
crucial factors in the development or inception of a product's development. Unrealistic
assumptions can cause a nosedive in the entire venture. Though assumptions are
abstract, there should be a move to develop tangible assumptions to come up with a
successful product.

Research and Development Once the Market Research is carried out, the
customer's need is given to the Research & Development division (R&D) to conceptualize
a cost-effective system that could potentially solve the customer's needs in a manner
that is better than the one adopted by the competitors at present. Once the conceptual
system is developed and tested in a hypothetical environment, the development team
takes control of it. The development team adopts one of the software development
methodologies that is given below, develops the proposed system, and gives it to the
customer.

The Sales & Marketing division starts selling the software to the available
customers and simultaneously works to develop a niche segment that could potentially
buy the software. In addition, the division also passes the feedback from the customers
to the developers and the R&D division to make possible value additions to the product.

While developing a software, the company outsources the non-core activities to

other companies who specialize in those activities. This accelerates the software
development process largely. Some companies work on tie-ups to bring out a highly
matured product in a short period.

Popular Software Development Models The following are some basic popular
models that are adopted by many software development firms

1. System Development Life Cycle (SDLC) Model

2. Prototyping Model
3. Rapid Application Development Model
4. Component Assembly Model

A. System Development Life Cycle (SDLC) Model This is also known as

Classic Life Cycle Model (or) Linear Sequential Model (or) Waterfall Method. This model
has the following activities.

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1. System/Information Engineering and Modeling As software is always of
a large system (or business), work begins by establishing the requirements for all
system elements and then allocating some subset of these requirements to software.
This system view is essential when the software must interface with other elements such
as hardware, people and other resources. System is the basic and very critical
requirement for the existence of software in any entity. So if the system is not in place,
the system should be engineered and put in place. In some cases, to extract the
maximum output, the system should be re-engineered and spruced up. Once the ideal
system is engineered or tuned, the development team studies the software requirement
for the system.

2. Software Requirement Analysis This process is also known as

feasibility study. In this phase, the development team visits the customer and studies
their system. They investigate the need for possible software automation in the given
system. By the end of the feasibility study, the team furnishes a document that holds the
different specific recommendations for the candidate system. It also includes the
personnel assignments, costs, project schedule, target dates etc.... The requirement
gathering process is intensified and focussed specially on software. To understand the
nature of the program(s) to be built, the system engineer or "Analyst" must understand
the information domain for the software, as well as required function, behavior,
performance and interfacing. The essential purpose of this phase is to find the need and
to define the problem that needs to be solved.

3. System Analysis and Design In this phase, the software

development process, the software's overall structure and its nuances are defined. In
terms of the client/server technology, the number of tiers needed for the package
architecture, the database design, the data structure design etc... are all defined in this
phase. A software development model is thus created. Analysis and Design are very
crucial in the whole development cycle. Any glitch in the design phase could be very
expensive to solve in the later stage of the software development. Much care is taken
during this phase. The logical system of the product is developed in this phase.

4. Code Generation The design must be translated into a machine-readable

form. The code generation step performs this task. If the design is performed in a
detailed manner, code generation can be accomplished without much complication.
Programming tools like compilers, interpreters, debuggers etc... are used to generate
the code. Different high level programming languages like C, C++, Pascal, Java are used
for coding. With respect to the type of application, the right programming language is
chosen.

B. Prototyping Model This is a cyclic version of the linear model. In this model,
once the requirement analysis is done and the design for a prototype is made, the
development process gets started. Once the prototype is created, it is given to the
customer for evaluation. The customer tests the package and gives his/her feed back to
the developer who refines the product according to the customer's exact expectation.
After a finite number of iterations, the final software package is given to the customer.
In this methodology, the software is evolved as a result of periodic shuttling of
information between the customer and developer. This is the most popular development
model in the contemporary IT industry. Most of the successful software products have

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been developed using this model - as it is very difficult (even for a whiz kid!) to
comprehend all the requirements of a customer in one shot. There are many variations
of this model skewed with respect to the project management styles of the companies.
New versions of a software product evolve as a result of prototyping.
Back to top.

C. Rapid Application Development (RAD) ModelThe RAD modelis a linear

sequential software development process that emphasizes an extremely short
development cycle. The RAD model is a "high speed" adaptation of the linear sequential
model in which rapid development is achieved by using a component-based construction
approach. Used primarily for information systems applications, the RAD approach
encompasses the following phases:

1. Business modeling The information flow among business functions is

modeled in a way that answers the following questions:

What information drives the business process?

What information is generated?
Who generates it?
Where does the information go?
Who processes it?

2. Data modeling The information flow defined as part of the business

modeling phase is refined into a set of data objects that are needed to support
the business. The characteristic (called attributes) of each object is identified and
the relationships between these objects are defined.

3. Process modeling The data objects defined in the data-modeling phase

are transformed to achieve the information flow necessary to implement a
business function. Processing the descriptions are created for adding, modifying,
deleting, or retrieving a data object.

4. Application generation The RAD model assumes the use of the RAD
tools like VB, VC++, Delphi etc... rather than creating software using
conventional third generation programming languages. The RAD model works to
reuse existing program components (when possible) or create reusable
components (when necessary). In all cases, automated tools are used to facilitate
construction of the software.

5. Testing and turnover Since the RAD process emphasizes reuse,

many of the program components have already been tested. This minimizes the
testing and development time.
Back to top

D. Component Assembly Model Object technologies provide the technical

framework for a component-based process model for software engineering. The object
oriented paradigm emphasizes the creation of classes that encapsulate both data and
the algorithm that are used to manipulate the data. If properly designed and
implemented, object oriented classes are reusable across different applications and
computer based system architectures. Component Assembly Model leads to software

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reusability. The integration/assembly of the already existing software components
accelerates the development process. Nowadays many component libraries are available
on the Internet. If the right components are chosen, the integration aspect is made
much simpler.

Q.3:- a. Explain the role of systems analyst in SDLC. Explain with a scenario.
b. Draw a data flow diagram for an hospital management system.

Ans:- SDLC System development cycle stages are sometimes known

as system study. System
concepts which are important in developing business information systems expedite
problem solving and improves the quality of decisionmaking. The system analyst has
to do a lot in this connection. They are confronted with the challenging task of
creating new systems an planning major changes in the organization.

The system analyst gives a system development project, meaning and direction.
The typical breakdown of an information systems life cycle includes a feasibility
study, requirements, collection and analysis, design, prototyping, implementation,
validation, testing and
operation. It may be represented in the form of a block diagram as shown below:

1. Feasibility study It is concerned with determining the cost effectivenes

s of various
alternatives in the designs of the information system and the priorities among
the various system components.

2. Requirements, collection and analysis It is concerned

with understanding the mission of the information systems, that is, the
application areas of the system within the enterprise and
the problems that the system should solve.

3. Design It is concerned with the specification of the information

systems structure. There are two types of design, database design and
application design. The database design is the design of the database design and
the application design is the design of the application programs.

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 4. Prototyping A prototype is a simplified implementation that is produced i
n order
to verify in practice that the previous phases of the design were well conducted.

5. Implementation It is concerned with the programming of the final

operational version of the information system. Implementation alternatives are
carefully verifies and compared.

6. Validation and testing It is the process of assuring that each

phase of the development process is of acceptable quality and is an accurate
transformation from the previous phase.

Data Flow Diagram Data flow diagrams represent the logical flow of data within
the system. DFD do not explain how the
processes convert the input data into output. They do not
explain how the processing takes place. DFD uses few symbols like circles and rectangles
connected by arrows to represent data flows. DFD can easily illustrate relationships
among data, flows, external entities an stores. DFD can also be drawn in
increasing levels of detail, starting with a summary high level view and
proceeding more detailed lower level views.

Q.4:- What are the features contributing to success and failures of MIS
models?

Ans:- Factors Contributing to Success of MIS The following features

contributing a lot for the success of MIS and are listed below:-

1. The MIS is integrated into the managerial functions. It sets clear objectives to
ensure that the MIS focuses on the major issues of the business. Also adequate
development resources are provided and the human and organisational barriers to
progress are removed.

2. An appropriate information processing technology required to meet the data

processing and analysis needs of the users of the MIS is selected.

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3. The MIS is oriented, defined and designed in terms of the user’s requirements
and its operational viability is ensured.

4. The MIS is kept under continuous surveillance, so that its open system design is
modified according to the changing information needs.

5. MIS focuses on the business results and goals, and highlights the factors and
reasons for non-achievement.

6. MIS is not allowed to end up into an information generation mill avoiding the
noise in the information and the communication system.

7. The MIS recognises that manager is a human being and therefore, the systems
must consider all the human behavioural factors in the process of the management.

8. The MIS recognises that the different information needs for different objectives
must be met with. The globalisation of information in isolation from the different
objectives leads to information overload and its non-use.

9. The MIS is easy to operate and, therefore, the design of the MIS has such
features which make up a user-friendly design.

10. MIS recognises that the information needs become obsolete and new needs
emerge. The MIS design, therefore, has a basic potential capability to quickly meet new
needs of information.

11. The MIS concentrates on the developing the information support to manage
critical success factors. It concentrates on the mission critical applications serving the
needs of the top management.

Factors Contributing to Failure of MIS The common observed features which are
responsible for the failure of MIS is as follows:-

1. The MIS is conceived as a data processing and not as an information processing

system.

2. The MIS does not provide that information which is needed by the managers but
it tends to provide the information generally the function calls for. The MIS then
becomes an impersonal system.

3. Underestimating the complexity in the business systems and not recognising it in

the MIS design leads to problems in the successful implementation.

4. Adequate attention is not given to the quality control aspects of the inputs, the
process and the outputs leading to insufficient checks and controls in the MIS.

5. The MIS is developed without streamlining the business processing systems in the
organisation.

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6. Lack of training and appreciation that the users of the information and the
generators of the data are different, and they have to play an important responsible role
in the MIS.

7. The MIS does not meet certain critical and key factors of its users such as a
response to the query on the database, an inability to get the processing done in a
particular manner, lack of user-friendly system and the dependence on the system
development personnel.

8. A belief that the computerised MIS can solve all the management problems of
planning and control of the business.

9. Lack of administrative discipline in following the standardised systems and

procedures, wrong coding and deviating from the system specifications result in
incomplete and incorrect information.

11. The MIS does not give perfect information to all the users in the organisation. Any
attempt towards such a goal will be unsuccessful because every user has a human
ingenuity, bias, certain assumptions not known to the designer. The MIS cannot make up
these by providing perfect information.

Q.5:- What are the limitations of ERP systems? How do ERP packages
help in overcoming theses limitations?

Ans:- Enterprise Resource Planning Manufacturing management systems have

evolved in stages over the few decades from a simple
means of calculating materials
requirements to the automation of an entire enterprise. Around 1980, over
frequent changes
in sales forecasts, entailing continual readjustments in production, as well as the
unsuitability
of the parameters fixed by the system, led MRP (Material Requirement Planning) to
evolve into a new concept : Manufacturing Resource Planning (or MRP2) and
finally the generic concept Enterprise Resource Planning (ERP)

The initials ERP originated as an extension of MRP (material requirements

planning then manufacturing resource planning). ERP systems now attempt to
cover all basic functions of an enterprise, regardless of the organization's business or
charter. Nonmanufacturing businesses, nonprofit organizations
and governments now all utilize ERP systems. To be considered an ERP system, a
software package must provide the function of at least two
systems. For example, a software package that provides both payroll and
accounting functions could technically be considered an ERP software package.

However, the term is typically reserved for larger, more broadly based application
s. The introduction of an ERP system to replace two or more independent applications
eliminates the need for external interfaces previously required between systems,

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and provides additional benefits that range from
standardization and lower maintenance to easier and/or greater reporting capabilities.

Some organizations -typically those with sufficient inhouse IT skills to integrate

multiple software products - choose to implement only portions of an ERP system and
develop an external interface to other ERP or standalone systems for their other
application needs. For example, one may choose to use the HRMS from one
vendor, and the financials systems from another, and perform the integration
between the systems themselves.

Ideally, ERP delivers a single database that contains all data for the software mod
ules, which would include:

Enterprise Resource Planning is a term originally derived from manufacturing

resource planning that followed material requirements planning . MRP evolved into
ERP when "routings" became a major part of the software architecture and a
company's capacity planning activity also became a part of the standard software
activity. ERP systems typically handle the manufacturing, logistics, distribution,
inventory, shipping, invoicing, and accounting for a company.
Enterprise Resource Planning or ERP software can aid in the control of many
business activities, like sales, marketing, delivery, billing, production, inventory
management, quality management, and human resource management.

ERP systems saw a large boost in sales in the 1990s as companies faced the Y2K
problem in their legacy systems. Many companies took this opportunity to replace their
legacy information systems
with ERP systems. This rapid growth in sales was followed by a
slump in 1999, at which time most
companies had already implemented their Y2K solution.

ERPs are crossfunctional and enterprise wide. All functional departments

that are involved in operations or production are integrated in one system. In
addition to manufacturing, warehousing, logistics, and information technology, this
would include accounting, human resources, marketing, and strategic management.

The Ideal ERP System

An ideal ERP system is when a single database is utilized and contains all data
for various software modules. These software modules can include:

1. Manufacturing: Some of the functions include; engineering, capacity,

workflow management, quality control, bills of material, manufacturing process, etc.
2. Financials: Accounts payable, accounts receivable, fixed assets, general
ledger and cash management, etc.
3. Human Resources: Benefits, training, payroll, time and attendance, etc
4. Supply Chain Management: Inventory, supply chain planning, supplier
scheduling, claim processing, order entry, purchasing, etc.
5. Projects: Costing, billing, activity management, time and expense, etc.
6. Customer Relationship Management: sales and marketing, service,
commissions, customer

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contact, calls center support, etc.
7. Data Warehouse: Usually this is a module that can be accessed by an organizati
ons customers, suppliers and employees.

Limitations of ERP Success depends on the skill and experience of the workforc
e, including
training about how to make the system work correctly. Many companies cut costs by
cutting training budgets. Privately owned small enterprises are often
undercapitalized, meaning their ERP system is often operated by personnel with
inadequate education in ERP in general, such as APICS foundations, and in
the particular ERP vendor package being used.

1. Personnel turnover; companies can employ new managers lacking

education in the company's ERP system, proposing changes in business practices
that are out of synchronization with the best utilization of the company's selected ERP.
2. Customization of the ERP software is limited. Some customization may involve
changing of the ERP software structure which is usually not allowed.

3. Reengineering of business processes to fit the "industry standard" prescribed

by the ERP system may lead to a loss of competitive advantage.

4. ERP systems can be very expensive to install often ranging from 30,000
US Dollars to 500,000,000 US Dollars for multinational companies.

5. ERP vendors can charge sums of money for annual license renewal that is unrelat
ed to the size of the company using the ERP or its profitability.

6. Technical support personnel often give replies to callers that are inappropriate for
the caller's corporate structure. Computer security concerns arise, for example
when telling a non-
programmer how to change a database on the fly, at a company that requires an audit
trail of changes so as to meet some regulatory standards.

7. ERPs are often seen as too rigid and too difficult to adapt to the specific
workflow and business process of some companies
this is cited as one of the main causes of their failure.

8. Systems can be difficult to use.

9. Systems are too restrictive and do not allow much flexibility in implementation an
d usage.
10. The system can suffer from the "weakest link" problem an inefficiency in one
department or at one of the partners may affect other participants.

11. Many of the integrated links need high accuracy in other applications to work
effectively. A company can achieve minimum standards, then over time "dirty
data" will reduce the reliability of some applications.

12. Once a system is established, switching costs are very high for any one
of the partners (reducing flexibility and strategic control at the corporate level).

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13. The blurring of company boundaries can cause problems in accountability,
lines of responsibility, and employee morale.

14. Resistance in sharing sensitive internal information between departments

can reduce the effectiveness of the software.

15. Some large organizations may have multiple departments with separate,
independent resources, missions, chainsofcommand, etc, and consolidation into a single
enterprise may yield limited benefits.

16. There are frequent compatibility problems with the various legacy systems of the
partners.

17. The system may be overengineered relative to the actual needs of the customer.

Before ERP systems, each department in an organization would most likely have t
heir own computer
system, data and database. Unfortunately, many of these systems would not be able
to communicate with one another or need to store or rewrite data to make it
possible for cross computer system communication. For instance, the financials of a
company
were on a separate computer system than the HR system, making it more intensive and
complicated to process certain functions. Once an ERP system is in place, usually all
aspects
of an organization can work in harmony instead of every single system needing to be
compatible with
each other. For large organizations, increased productivity and less types of
software are a result.

Q.6:- Explain the relationship between artificial intelligence and neural

networks with
the help of a scenario.

Ans:- Artificial Intelligence is the science and technology based on various functions to
develop a system that can think and work like a human being. It can reason,
analyze, learn, conclude and
solve problems. The systems which use this type of intelligence are known as artificial
intelligent systems and their intelligence is referred to as artificial intelligence.
It was said that the computer don’t have common sense. Here in AI, the main idea
is to make the computer think like human beings, so that it can be then said that
computers also have common sense. More precisely the aim is to
obtain a knowledge based computer system that will help managers to take quick decisio
ns in business.

Artificial Intelligence can be classified into various branches like Natural Language
Processing (NLP), Speech Recognition, Automated Programming, Machine Learning,
Pattern Recognition and Probabilistic Networks. Most of the software developed for AI
have been through Prolog, C++, Java and LISP. These programming languages
provide facility of creating various functions of business activity, extension of a

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function, handling dynamic situations in business, providing uniformity
in application etc.

A neuron is a micro cell which is connected to thousands of other micro cells in th

e brain and all the other parts of the human body containing nerves. It is a system
which tries to learn from the database and the manager
then decides what the right answer is. The entire neural network is realized in
the form of software. The software renders the computer as a problem solver. The
neural networks goes on building strong database for problem solving depending
upon the decisions taken by the manager in the form of response confirmation
given to the system by the manager. Neural networks can be used in various
business applications like forecasting, stock analysis, market analysis etc.

Advantages of Neural Networks Neural networks are used to forecast some complex
data patterns. When designed properly, they can be used as experts for a
particular project. They have the ability to adjust to the changing environment and
thus are very flexible. For example, it can forecast net asset values of mutual funds.

Artificial intelligence is a field of science and technology based on

disciplines such as
computer science, biology, psychology, linguistics, mathematics and engineering. The
goal of AI is to develop computers that can simulate the ability to think, see,
hear, walk, talk and feel. In other words, simulation of computer functions
normally associated with human intelligence, such as
reasoning, learning and problem solving. AI can be grouped under three major
areas: cognitive science, robotics and natural
interfaces. Cognitive science focuses on researching on how the human brain works and
how humans think and learn. Applications in the cognitive science area of AI include the
development of expert systems and other knowledgebased systems that add a
knowledge base and some reasoning capability to information systems. Also
included are adaptive learning systems that can modify their
behavior based on information they acquire as they operate. Chess-
playing systems are some examples of such systems.

Fussy logic systems can process data that are incomplete or ambiguous. Thus, th
ey can solve semi
structured problems with incomplete knowledge by developing approximate inferences
and answers, as humans do.

Neural network software can learn by processing sample problems and

their solutions. As
neural nets start to recognize patterns, they can begin to program themselves to solve
such problems on their own. Neural networks are computing systems modeled after
the human brain’s mesh like network of interconnected processing elements, called
neurons. The human brain is estimated to have over 100 billion neuron brain cells.
The neural networks are lot simpler in architecture. Like the brain,
the interconnected processors in a neural network operate in parallel and interact dynam
ically with each other.

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 This enables the network to operate and learn from the data it processes, similar
to the human brain. That is, it learns to recognize patterns and relationships in
the data. The more data examples
it receives as input, the better it can learn to duplicate the results of the examples
it processes. Thus, the neural networks will change the strengths of the
interconnections between the processing elements in response to changing patterns
in the data it receives and results that occur.

For example, neural network can be trained to learn which credit characteristics r
esult in good or bad loans. The neural network would continue to be trained until
it demonstrated a high degree
of accuracy in correctly duplicating the results of recent cases. At
that point it would be trained enough to begin making credit evaluations of its own.

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 ASSIGNMENTS - MBA – II SEMESTER

MB0031

SET 2

MANAGEMENT INFORMATION SYSTEMS

Q.1:- Explain the different business models that work together in an E-

enterprise system. Give example for each.

Ans:- Managing an E-business & Challenges before an E-business -Due to Internet

capabilities and web technology, traditional business organization definition has
undergone a change where scope of the enterprise now includes other company
locations, business partners, customers and vendors. It has no geographic boundaries as
it can extend its operations where Internet works. All this is possible due to Internet and
web moving traditional paper driven organization to information driven Internet enabled
E-business enterprise. E-business enterprise is open twenty-four hours, and being
independent, managers, vendors, customers transact business any time from anywhere.
Internet capabilities have given E-business enterprise a cutting edge capability
advantage to increase the business value. It has opened new channels of business as
buying and selling can be done on Internet. It enables to reach new markets across the
world anywhere due to communication capabilities. It has empowered customers and
vendors / suppliers through secured access to information to act, wherever necessary.
The cost of business operations has come down significantly due to the elimination of
paper-driven processes, faster communication and effective collaborative working. The
effect of these radical changes is the reduction in administrative and management
overheads, reduction in inventory, faster delivery of goods and services to the
customers.

In E-business enterprise traditional people organization based on 'Command

Control' principle is absent. It is replaced by people organization that is empowered by
information and knowledge to perform their role. They are supported by information
systems, application packages, and decision-support systems. It is no longer functional,
product, and project or matrix organization of people but E-organization where people
work in network environment as a team or work group in virtual mode. E-business
enterprise is more process-driven, Technology-enabled and uses its own information and
knowledge to perform. It is lean in number, flat in structure, broad in scope and a
learning organization. In E-business enterprise, most of the things are electronic, use
digital technologies and work on databases, knowledge bases, directories and document
repositories. The business processes are conducted through enterprise software like ERP,
SCM, and CRM supported by data warehouse, decision support, and knowledge
management systems. Today most of the business organizations are using Internet
technology, network, and wireless technology for improving the business performance
measured in terms of cost, efficiency, competitiveness and profitability. They are using
E-business, Ecommerce solutions to reach faraway locations to deliver product and
services. The enterprise solutions like ERP, SCM, and CRM run on Internet (Internet /
Extranet) & Wide Area Network (WAN). The business processes across the organization
and outside run on E-technology platform using digital technology. Hence today's
business firm is also called E-enterprise or Digital firm.

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 The paradigm shift to E-enterprise has brought four transformations, namely:

1. Domestic business to global business.

2. Industrial manufacturing economy to knowledge-based service economy.
3. Enterprise Resource Management to Enterprise Network Management.
4. Manual document driven business process to paperless, automated,
Electronically transacted business process.

These transformations have made conventional organization design obsolete.

In E-enterprise, business is conducted electronically. Buyers and sellers through

Internet drive the market and Internet-based web systems. Buying and selling is
possible on Internet. Books, CDs, computer, white goods and many such goods are
bought and sold on Internet. The new channel of business is well-known as Ecommerce.
On the same lines, banking, insurance, healthcare are being managed through Internet
E-banking, E-billing, E-audit, & use of Credit cards, Smart card, ATM, E-money are the
examples of the Ecommerce application. The digital firm, which uses Internet and web
technology and uses E-business and Ecommerce solutions, is a reality and is going to
increase in number.

MIS for E-business is different compared to conventional MS design of an

organization. The role of MIS in E-business organization is to deal with changes in global
market and enterprises. MIS produces more knowledge-based products. Knowledge
management system is formally recognized as a part of MIS. It is effectively used for
strategic planning for survival and growth, increase in profit and productivity and so on.
To achieve the said benefits of E-business organization, it is necessary to redesign the
organization to realize the benefits of digital firm. The organization structure should be
lean and flat. Get rid of rigid established infrastructure such as branch office or zonal
office. Allow people to work from anywhere. Automate processes after reengineering the
process to cut down process cycle time. Make use of groupware technology on Internet
platform for faster response processing. Another challenge is to convert domestic
process design to work for international process, where integration of multinational
information systems using different communication standards, country-specific
accounting practices, and laws of security are to be adhered strictly. Internet and
networking technology has thrown another challenge to enlarge the scope of
organization where customers and vendors become part of the organization. This
technology offers a solution to communicate, coordinate, and collaborate with
customers, vendors and business partners. This is just not a technical change in
business operations but a cultural change in the mindset of managers and workers to
look beyond the conventional organization. It means changing the organization
behaviour to take competitive advantage of the E-business technology.

The last but not the least important is the challenge to organize and implement
information architecture and information technology platforms, considering multiple
locations and multiple information needs arising due to global operations of the business
into a comprehensive MIS. E-COMMERCE is a second big application next to ERP. It is
essential deals with buying and selling of goods. With the advent of intent and web
technology, E-Commerce today covers an entire commercial scope online including
design and developing, marketing, selling, delivering, servicing, and paying for goods.

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Some E-Commerce application add order tracking as a feature for customer to know the
delivery status of the order.

E-Collaboration helps work effectively on applications like calendaring and

scheduling tasks, event, project management, workflow application, work group
application. E-collaboration system components are internet, Intranet, Extranet and LAN,
WAN networks for communication through GroupWare tools, browser.

Let us illustrate the model using an event in the business such as receipt of
material for a job to be processed on the shop floor. In this event there is a transaction
receipt of material, which needs to be processed, and then a workgroup will use this
information of material receipt. Each member of this workgroup has a different goal.

Q.2:- What are the different emerging fields in MIS? Explain with an
application of your own for each.

Ans:- A Strategic Information System (SIS) is a system to manage information and

assist in strategic decision making. A strategic information system has been defined as,
"The information system to support or change enterprise's strategy."

A SIS is a type of Information System that is aligned with business strategy and
structure. The alignment increases the capability to respond faster to environmental
changes and thus creates a competitive advantage. An early example was the favourable
position afforded American and United Airlines by their reservation systems, Sabre and
Apollo. For many years these two systems ensured that the two carriers' flights
appeared on the first screens observed by travel agents, thus increasing their bookings
relative to competitors. A major source of controversy surrounding SIS is their
sustainability.

SISs are different from other comparable systems as:

1. they change the way the firm competes.

2. they have an external (outward looking) focus.
3. they are associated with higher project risk.
4. they are innovative (and not easily copied).

It is mainly concerned with providing and organization and its members an

assistance to perform the routine tasks efficiently and effectively. One of the major issue
before any organization is the challenge of meeting its goals and objectives. Strategic IS
enable such organization in realizing their goals. Strategic Information System (SIS) is a
support to the existing system and helps in achieving a competitive advantage over the
organizations competitors in terms of its objectives. This unit deals with the critical
aspects of the strategic information system. This units indicates the theoretical concepts
and the way in which the same are realized in practice. The flow of the unit is in such a
way that it starts
with the development of contemporary theory about strategic uses of corporations'
internal information systems leading to systems which transcend the boundaries of
particular organizations. The process whereby strategic information systems are created
or identified is then examined. A number of weaknesses in the existing body of theory
are identified, and suggestions made as to directions in which knowledge is or may be

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progressing. A strategic information system is concerned with systems which contribute
significantly to the achievement of an organization's overall objectives. The body of
knowledge is of recent origin and highly dynamic, and the area has an aura of
excitement about it. The emergence of the key ideas, the process whereby strategic
information systems come into being is assessed, areas of weakness are identified, and
directions of current and future development suggested.

Information system is regarded as a tool to provide various services to different

management functions. The tools have been developing year by year and the application
of the tool has become more and more diverse. In management it is now a very power
means to manage and control various activities and decision making process. The
original idea of automating mechanical processes got quickly succeeded by the
rationalization and integration of systems. In both of these forms, IS was regarded
primarily as an operational support tool, and secondarily as a service to management.
Subsequent to the development, it was during the last few years that an additional
potential was discovered. It was found that, in some cases, information technology (IT)
had been critical to the implementation of an organization's strategy. An organization’s
strategy supported by information system fulfilling its business objectives came to be
known as Strategic Information System. The strategic information system consists of
functions that involved gathering, maintenance and analysis of data concerning internal
resources, and intelligence about competitors, suppliers, customers, government and
other relevant organizations.

Q.3:- How is MIS used for decision making in the organization?

Ans.:- Todays managers depend on information systems for decision making. The
managers have handful of data around them but manually they cannot process the data
accurately and with in the short period of time available to them due to heavy
competition in modern world. Therefore mangers depend on information systems.

The concept of MIS

Management Management has been defined in a variety of ways, but for

our purposes it comprises the process or activities what managers do in the operation of
their organization: Plan, Organize, Initiate and Control operations.

Information Data are facts and figures that are not currently being used in a
decision processes and usually take the form of historical records that are recorded and
filed without immediate intent to retrieve for decision making.

Information consists of data that have been retrieved, processed or otherwise

used for information or inference purposes, argument, or as a basis for forecasting or
decision making.

System can be described simply as a set of elements joined together for a

common objective. A subsystem is is part of a larger system with which we are
concerned. All systems are part of larger systems.

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 The objective of an MIS (Management Information System) is to provide
information for decision making on planning, initiating, organizing, and controlling the
operations of the subsystems of the form and to provide a synergetic organization in the
process.

Decision Support System: It is sometimes described as the next evolutionary step

after Management Information Systems (MIS) . MIS support decision making in both
structured and unstructured problem environments.. It supports decision making at all
levels of the organization .IS (Information Systems) are intended to be woven into the
fabric of the organizations , not standing alone. IS support all aspects of the decision
making process.MIS are made of people, computers, procedures, databases, interactive
query facilities and so on. They are intended to be evolutionary/adaptive and easy for
people to use.

Methods of Decision Making MIS is a technique for making programmed

decisions. If we include the computer and management science as integral parts or tools
of computer –based information systems, the prospects for a revolution in programmed
decision making are very real. Just as a manufacturing process is becoming more and
more automated so is the automation of programmed decisions increasing to support
this production and other information needs throughout the organization.

Q.4:-Below is the list of data from a sample project

Most likely Immediate
Activity duration (Days) Predecessors to
activity
A 4 E,B
B 7 A,E
C 5 ---
D 11 C
E 9 ---

a. Draw the PERT network for the above data. Also draw the critical path
for the network.
b. Given the optimistic time estimate as 3, the most likely time estimate as 12
and the pessimistic time estimate as 21, calculate the activity time estimate.

Ans:- (a) The critical path is that path which takes the longest time for start to end.
The critical path for the above mentioned network is as follows:-

C
2 5
A E

0
4
D 3 B

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 (b) to the optimistic time estimate = 3
tm the most likely time estimate = 12
tp the pessimistic time estimate = 21
te the activity time estimate = to + 4tm +tp
6
- ,- = 3 + 4(12) + 21
6
-,- = 12

Q.5:- Explain the difference between Intranet and Extranet

Ans:- Information Systems have grown powerful year after year. The role of the
traditional MIS has been obscured by newer software applications. Various
applications known collectively as enterprise resource planning (ERP) software
has taken a dominant position among large business applications. These packages,
which typically come in functional modules such as an accounting module,
a human resources module, and a manufacturing supply chain module, serve
many of the functions that a traditional MIS would, and they tend to be more
flexible, integrated, and user-friendly than legacy MIS. While early implementations
of ERP suites were largely cross functional databases with minimal high-level
management tools, later upgrades have added decision support and
data manipulation tools to facilitate a wide range of analyses.

In future, MIS is likely to be verbal and qualitative in nature. It will depend upon
the strength of the organizations Information Systems. Most of the enterprises are growi
ng and their systems also have to grow. The ever growing demands of the systems will f
orce out the old conventional systems by newer systems. The next decade is going to wit
ness several fundamental and qualitative changes in the practice of management of
commercial enterprises and other types of organizations. These changes would be
necessitated by better rates of economic growth, intensification of
competition, diversified and rapid technological developments, continuing fluidity in
economicpolitical environments, and sociopolitical changes involving the values and
attitudes of people working in organizations at all levels.
To support these demands and meet newer challenges in
the business, organizations will have to resort to various technologies. This unit
is based on such possible technologies which
will enable the enterprises to support their MIS.

Extranet An extranet is a private network that uses the Internet protocols and the
public telecommunication system to securely share part of a business's information or
operations with suppliers, vendors, partners, customers, or other businesses. An
extranet can be viewed as part of a company's intranet that is extended to users outside
the company. An extranet requires security and privacy.

A new buzzword that refers to an intranet that is partially accessible to authorized

outsiders. Whereas an intranet resides behind a firewall and is accessible only to people

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 who are members of the same company or organization, an extranet provides various
levels of accessibility to outsiders. You can access an extranet only if you have a valid
username and password, and your identity determines which parts of the extranet you
can view.

An extranet is somewhat very similar to an intranet. Extranets are designed

specifically to give external, limited access to certain files of your computer systems to:

1. Certain large or privileged customers.

2. Selected industry partners.
3. Suppliers and subcontractors... etc.

Therefore, a carefully designed extranet can bring additional business to your

company. Intranets and extranets all have three things in common:

1. They both use secured Internet access to the outside world.

2. Both can drastically save your company or organization a lot of
money.
3. Both need a user ID & password to control access to the whole
system.

The professional development team at My Web Services has the expertise and the
right tools to design the right intranet or extranet that will meet your exact needs, both
for today and the future.

Intranet An internal use, private network inside an organisation that uses the same
kind of software which would also be found on the Internet. Inter-connected network
within one organization that uses Web technologies for the sharing of information
internally, not world wide. Such information might include organization policies and
procedures, announcements, or information about new products.

An intranet is a restricted-access network that works like the Web, but isn't on it.
Usually owned and managed by a company, an intranet enables a company to share its
resources with its employees without confidential information being made available to
everyone with Internet access. A network based on TCP/IP protocols (an internet)
belonging to an organization, usually a corporation, accessible only by the organization's
members, employees, or others with authorization. An intranet's Web sites look and act
just like any other Web sites, but the firewall surrounding an intranet fends off
unauthorized access. Like the Internet itself, intranets are used to share information.

An intranet is an information portal designed specifically for the internal

communications of small, medium or large businesses, enterprises, governments,
industries or financial institutions of any size or complexity. Intranets can be custom-
designed to fit the exact needs of businesses no matter where they are situated. Users
of intranets consists mainly of:

1. Members of the executive team.

2. Accounting and order billing.
3. Managers and directors.
4. Sales people and support staff.

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5. Customer service, help desk, etc.

Q.6:- Explain the control issues in management information systems.

Ans:- A management control systems (MCS) is a system which gathers and uses
information to evaluate the performance of different organizational resources like
human, physical, financial and also the organization as a whole considering the
organizational strategies. Finally, MCS influences the behavior of organizational
resources to implement organizational strategies. MCS might be formal or informal. The
term ‘management control’ was given of its current connotations by Robert N. Anthony
(Otley, 1994).

According to Maciariello et al. (1994), management control is concerned with

coordination, resource allocation, motivation, and performance measurement. The
practice of management control and the design of management control systems draws
upon a number of academic disciplines. Management control involves extensive
measurement and it is therefore related to and requires contributions from accounting
especially management accounting. Second, it involves resource allocation decisions and
is therefore related to and requires contribution from economics especially managerial
economics. Third, it involves communication, and motivation which means it is related to
and must draw contributions from social psychology especially organizational behavior

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Management control systems use many techniques such as

1. Balanced scorecard The balanced scorecard (BSC) is a strategic

performance management tool - a semi-standard structured report supported by proven
design methods and automation tools that can be used by managers to keep track of the
execution of activities by staff within their control and monitor the consequences arising
from these actions.

2. Total quality management (TQM) Total Quality Management (or

TQM) is a management concept coined by W. Edwards Deming. The basis of TQM is to
reduce the errors produced during the manufacturing or service process, increase
customer satisfaction, streamline supply chain management, aim for modernization of
equipment and ensure workers have the highest level of training. One of the principal
aims of TQM is to limit errors to 1 per 1 million units produced. Total Quality
Management is often associated with the development, deployment, and maintenance of
organizational systems that are required for various business processes.

3. Kaizen (Continuous Improvement) Kaizen (Japanese for

"improvement" or "change for the better") refers to a philosophy or practices that focus
upon continuous improvement of processes in manufacturing, engineering, supporting
business processes, and management. It has been applied in healthcare, government,
banking, and many other industries.

4. Activity-based costing Activity-based costing (ABC) is a costing model that

identifies activities in an organization and assigns the cost of each activity resource to all
products and services according to the actual consumption by each: it assigns more
indirect costs (overhead) into direct costs. In this way an organization can precisely
estimate the cost of its individual products and services for the purposes of identifying
and eliminating those which are unprofitable and lowering the prices of those which are
overpriced.

5. Target costing Target costing is a pricing method used by firms. It is

defined as "a cost management tool for reducing the overall cost of a product over its
entire life-cycle with the help of production, engineering, research and design". A target
cost is the maximum amount of cost that can be incurred on a product and with it the
firm can still earn the required profit margin from that product at a particular selling
price.

6. Benchmarking and Benchtrending Benchmarking is the process of

comparing one's business processes and performance metrics to industry bests and/or
best practices from other industries. Dimensions typically measured are quality, time,
and cost. Improvements from learning mean doing things better, faster, and cheaper.

JIT: JIT may refer to:-

(a) Various meanings of Just In Time.

(b) Just-in-time compilation - a technique for improving the
performance of virtual machines in computing.

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 (c) Just-in-time (business) - a business inventory strategy.

7. Budgeting A budget (from old French bougette, purse) is generally a list of all
planned expenses and revenues. It is a plan for saving and spending. [1] A budget is an
important concept in microeconomics, which uses a budget line to illustrate the trade-
offs between two or more goods. In other terms, a budget is an organizational plan
stated in monetary terms.

8. Capital budgeting Capital budgeting (or investment appraisal) is the planning

process used to determine whether a firm's long term investments such as new
machinery, replacement machinery, new plants, new products, and research
development projects are worth pursuing. It is budget for major capital, or investment,
expenditures.

9. Program management techniques, etc.

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