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Chapter 6

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Information Technology
ITEC 1010
Paul Kashiyama

Chapter 6: Information and decision support system why learn? • Helping you and your coworkers make more informed decisions • find the least expensive way to ship products to market and to solve bottlenecks • management information system (MIS) must provide the right information to the right person in the right format at the right time ◦ a scheduled report, a demand report, a drill down report, key-indicator report, and an exception report. • Decision support system (DSSs) are used when the problems are unstructured Decision making and problem solving • strategic planning and overall goals of the organization set the course for decision making • information systems assist with problem solving, helping people make better decision • decision making phase ◦ intelligence stage: identify and define potential problems or opportunities ◦ design stage: develop alternative solutions to the problem and evaluate their feasibility ◦ choice stage: requires selecting a course of action • problem solving:Aprocess that goes beyond decision making to include the implementation stage. Programmed decision vs non programmed decision • programmed decision ◦ made using a rule, procedure, or quantitative method ◦ easy to computerize using traditional information systems • non programmed decision ◦ decision that deals with 3 approaches to find solutions • optimization model ◦ Aprocess to find the best solution, usually the one that will best help the organization meet its goals. ◦ Ex: consider all cities/towns to find the location that best meets the requirements • satisfying model ◦ Amodel that will find a good—but not necessarily the best—solution to a problem. ◦ Ex: Consider a manageable number of cities that might satisfy the company's requirements • Heuristics ◦ “Rules of thumb,” or commonly accepted guidelines or procedures that usually find a good solution. ◦ Ex: consider cities that are friendly new Benefits • performance of decision support system is typically a function of decision quality and problem complexity • Decision quality can result in increased effectiveness, increased efficiency, higher productivity • Problem complexity depends on how hard the problem is to solve and implement Overview • MIS(management information system) is an integrated collection of people, procedures, databases, and devices that provides managers and decision makers with information • purpose of MIS ◦ to help achieve organizational goals ◦ providing the right information to the right people in the right format and at the right time ◦ transaction can enter the organization inputs • internal data sources include ◦ TPS and ERP systems and related databases • External sources of data include ◦ customers, suppliers, competitors, and stockholders whose data is not already captured by TPS and ERP systems, as well as other sources, such as the Internet output • scheduled report:Areport produced periodically, such as daily, weekly, or monthly. • key-indicator report:Asummary of the previous day’s critical activities, typically available at the beginning of each workday. • demand report:Areport developed to give certain information at someone’s request rather than on a schedule. • exception report:Areport automatically produced when a situation is unusual or requires management action. • drill-down report:Areport providing increasingly detailed data about a situation. Characteristics of a Management Information System • Provide reports with fixed and standard formats • Produce hard-copy and soft-copy reports • Use internal data stored in the computer system • Allow users to develop custom reports • Require user requests for reports developed by systems personnel financial MIS • provides financial info to executives and others • financial forecasting • profit/loss and cost systems • auditing: internal & external • uses and management of funds manufacturing MIS • used to monitor and control the flow of materials, products, and services through the organization • as raw materials are converted to finished goods, the manufacturing MIS monitors the process at almost every stage • common information ◦ design and enginerring ◦ master Marketing MIS • supports managerial activities in product development, distribution, pricing decisions, promotional effectiveness, and sales forecasting Human Reso
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