IT for Management 22MBA302

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MODULE 1: Intro to Management Information Systems (MIS)
1.1) Concepts, Roles, Impacts, MIS & its users
The objective of the MIS is to provide information for a decision support in the process
of management. It should help in such a way that the business goals are achieved in the
most efficient manner. Since the decision-making is not restricted to a particular level, the
MIS is expected to support all the levels of the management in conducting the business
operations. Unless the MIS becomes a management aid, it is not useful to the
organization
The MIS provides facilities to analyze the data and offers the decision support systems to
perform the task of execution. The MIS provides an action-oriented information.
Every person in the organization is a MIS user. So it caters to the needs of all persons
MIS user is expected to be a rational person and its design is based on this assumption.
MIS does the job of data manipulation and integration. It analyses the data in a
predetermined manner. This means that the knowledge of business is transferred from
an individual to the MIS and is made available to all in the organization. This change
arising out of the MIS creates a sense of being neglected for knowledge, information and
advice. The psychological impact is larger if the person is not able to cope up with this
change by expanding or enriching the job and the position held by him. The nature of the
impact in a few cases is negative. However, this negative impact can be handled with
proper training and counseling.
The positive effects of the individuals at all levels are that they have become more
effective operators. The impact of the MIS on people of the organization is phenomenal
as it has made the same body of people collectively more effective and productive
Through MIS, the information can be used as a strategic weapon to counter the threats
to business, make businesses more competitive, bring about the organizational
transformation through integration. A good MIS also makes an organization seamless by
removing all the communication barriers.

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1.2) Components of an IS
The fund of information motivates an enlightened manager to use a variety of tools of
the management. It helps him to resort to such exercises as experimentation and
modeling.
The use of computers enables him to use the tools and techniques which are impossible
to use manually. The ready-made packages make this task simple.
MIS works on the basic systems such as transaction processing and databases

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1.3) Management as Control systems
Planning, organizing, staffing, coordinating, directing and controlling are the various
steps ina management process. All the steps prior to a control are necessary but are not
necessarily self-assuring the results unless it is followed by a strong control mechanism.

The hypothesis is that unless a control is exercised on the process, the goals will not be
achieved. A definition of control is the process through which managers assure that
actual activities conform to the planned activities, leading to the achievement of the
stated common goals. The control process measures a progress towards those goals, and
enables the manager to detect the deviations from the original plan in time to take
corrective actions before it is too late.
Key attributes of a Control system are: Early Warning Mechanism; Performance
Standard; Strategic Controls; Feedback; Realistic; Information Flow; Exception Principle
– Management by Exception;
It creates an information-based work culture in the organization

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1.4) MIS support to Organization Effectiveness
MIS helps the clerical personnel in transaction processing and answers their queries
on the data pertaining to the transaction, the status of a particular record and reference
on a variety of documents.
MIS helps the junior management personnel by providing the operational data for
planning, scheduling and control, and helps them further in decision making at the
operations level to correct an out of control situation.
MIS helps the middle management in short term planning, target setting and controlling
the business functions. It is supported by the use of the management tools of planning and
control.
MIS helps the top management in goal setting, strategic planning and evolving the
business plans and their implementation.
The MIS plays the role of information generation, communication, problem
identification and helps in the process of decision-making. It therefore, plays a vital
role in the management, administration and operations of an organization

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1.5) MIS for E- business (or for any competitive Business)

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21st century organizations are E-Enterprises. They run their major operations on Internet/On-
Premises Infrastructure/WAN spread over large areas.
The term ‘E- Business enterprise’ was coined to convey the use of Internet and IT in key
resource management processes and to transact the business with customers, suppliers and
business partners. ERP, SCM, CRM, PLM and home grown legacy systems are the main
applications in the business

Figure 1.9 is a Model of MIS for a digital firm’s IS stack

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1.6) Digital Firms – E-Commerce, E – Communication, E-Collaborations
With the advancement of Internet, Web communication, network and Information technology,
business process management crossed the boundaries of the organization and embraced every
aspect of the business making all its operations ‘Digital’. That is capturing the data or event,
validating, processing, decision making, storing, and delivering. The extent of use of these
technologies is so much across the boundaries of the organization that E- Business enterprise has
become completely digitized all its operations, and hence is now called as a “Digital Firm”.
Going digital has a clear strategic advantage to the firm and its stake holders. Supply chain
management systems, customer relationship management systems, enterprise management
systems (ERPs), and knowledge management systems, content management systems are the
main systems which drive the function of a digital firm.
In a digital firm, relationships with customers, suppliers, and employees are digital, meaning all
transactions, communications, pictures, images, drawings, data, and information are exchanged
through digital medium. Customer orders, delivery, billing and payment, purchases and so on are
through web and internet using enterprise software. Information like product details is
communicated through web to the customer. Using organisation’s Web portal customer can build
the order to the self requirement accessing this information and post it to the organization’s order
book, and keep its track till it is delivered.
In Digital Firm traditional people organization based on ‘Command Control’ principle is absent.
It is replaced by people organization who are empowered by information and knowledge to
perform their role. They are supported by information systems, application packages, decision
supported 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.

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Generic Digital Firm Model

Organization Structure of a Digital Firm

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Digital Firm is more a process driven, technology enabled, and uses its own information and
knowledge to perform. It is lean in size, flat in structure, broad in scope and a learning
organization
The paradigm shift to Digital Firm has brought four transformations, namely
• Domestic business to global business.
• Industrial manufacturing economy to knowledge based service economy
• Enterprise Resource Management to Enterprise Network Management.
• Manual document driven biz process to automated electronically transacted biz process
Managers in Digital Firm must be highly IS and IT literate to meet their own information and
knowledge needs. Major management challenge to build and use MIS is developing competitive
information systems, understanding the character of global business heterogeneity, variability &
risk, creation of IS and IT platform for achieving MIS goals.
The enabling capabilities of technology have given rise to four business models that together
work in an E-enterprise organization. They are
• E-business
• E-communication
• E-commerce
• E-collaboration

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Customer-Centric E-Biz System

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E-Commerce: Biz Channel(s) of an Enterprise
E-commerce is a second big application next to ERP. E-commerce process has two participants,
namely buyer and seller, like in traditional business model. And unique and typical to E-
commerce there is one more participant known as ‘Merchant Server’. Merchant server role in E-
commerce ensure secures payment to seller by authorization and authentication of commercial
transaction. E-commerce process model can be viewed in four ways and categories.
• B 2 C: Business Organiztion to Customer
• B 2 B: Business Organization to Business
• C 2 B: Customer to Business Organization
• C 2 C: Customer to Customer

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E-Communication:
E-communication system is a backbone of all processes whose role is to share information by
messages or store information to download on access by the customer. This is done through
many applications and systems
Ex: E-Mail; Voice Mail; Messaging (Secure; Public); Conferencing (Audio/Video/MS
Teams/Google Meet); Corporate Wiki(s)
Another E-communication system which is a kind of offline is known as web publishing. Web
publishing uses websites and portals for storing documents, catalogs, drawings, pictures and so
on for sharing. Such information is stored on documents. In this system, a user searches,
navigates, selects and downloads document for self-use. Web publishing is popular among
research organizations, educational bodies, government organizations, and large business and
commercial bodies. These organizations have large information set and document to share with
the community.
Enterprise information portal is another tool used for information posting and communication
to users or customers. Portal is a web-based interface on an integrated internet/intranet/extranet
platform allowing customers to use application and other services. It provides secured access to
all users/consumers to search information, analyse the situation and communicate. The difference
between a website and a portal is that the latter is a comprehensive multipurpose repository of
information, applications, tools to serve the consumers. Most of the information needs are met at
one place like portal eliminating excessive surfing, quick access to various resources and
application. Relatively, website is a very focussed platform with limited objective of sharing and
communicating the information

E-Collaboration:
Every business has number of work scenarios where group of people work together to complete
the tasks and to achieve a common objective. The groups could be teams or virtual teams with
different member strength. They come together to perform a task to achieve some results. The
process is called collaboration. The collaboration now is possible with e-technologies, which put
these teams in network with Internet support for communication, access to different databases
and servers. These capabilities help to create collaborative work systems and allow members to
work together cooperatively on projects and assignments
GroupWare is a collaboration software. For example, Lotus Notes, Novell GroupWare,
Microsoft exchange and Netscape communicator are GroupWare tools. These tools are designed
to make communication and coordination between members of the group more easily,
disregarding their physical location

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MIS in E-organization deviates from the conventional model of ‘Capture -
Compute - Process - Analyze - Report - Think and Act’ to ‘Point - Click -
Respond - Act’.

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1.7) Real Time Enterprise (RTE)
Real Time Enterprise (RTE) is a special case of a digital firm. In RTE the business needs are to
be executed in real time mode i.e. functions in critical areas in real time. In real time mode,
decision makers’ responses have to be faster and correct. In a digital firm, there is an automation
of data or event capturing, assessing, analyzing, inferring and decision making. Fairly large
amount of decision making responsibility is embedded into information driven decision making
systems.
MIS’ focus needs to shift from just in time information to just in time actionable information.
The just in time actionable information is a result of analytical processing of the business results
and the strategy behind it. This is best handled by introducing an information systems designed
to produce Balance Score Card, Score card and Dashboard.
An efficiently working RTE would have the following characteristics.
• Business process automation bridging the gap between organizations, systems and processes.
• Real time creation/storage of information ready for exchange to customers, vendors and
business partners.
• Processes to ensure currency and consistency of information across the global network.
* Event driven processes with automated sense and respond trigger eliminating human
intervention
Four Tech Components that support RTE
1) Internet/Intranet & Web Technology
2) Enterprise Software – ERP/SCM/CRM
3) Infrastructure – Hardware; Software, Security, Connectivity
4) Solution providers for Information Sharing

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 Real Time Enterprise MIS model

There are five forces which are driving the move for an Organization to RTE
1. The differentiation between competition and the organization is zeroing down to the quality of
delivery in terms of cost, time and speed. RTE approach ensures such delivery.
2. The demand for operational excellence through value based management supported by
information through score card and dash board.
3. The competition is now on how you integrate SCM and CRM on the platform of ERP and
leverage the integration to mutual advantage.
4. The rapid development and convergence of emerging technologies such as RFID, Ubiquitous
Computing, Neural Network, Pattern recognition, and Mobile computing into Internet, web, IT ,
Network, Communication , Wireless technology. These technologies enable automation of
processes with least human intervention.
5. It offers competitive advantage due to
• Availability of superior competitive intelligence.
• Reduced response time to customer call.

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• Transparency and visibility to entire value chain.
• Significant reduction in cost of serving customer needs.
To build sustainable competitive advantage an organization needs a real time response to all the
events in the organization. Transforming to RTE is the solution. There are many ways to achieve
this, but the best long term strategy is to invest fi rst in systems that are built to support RTE.
Goal Displacement & Sigmoid / S Curve
Organization continuously exchanges the information with the environment and is influenced by
the changes in it. Therefore, has to be built in such a fashion that it adjusts with the changes in
the environment and that the goals and objectives are achieved. MIS has to be designed as an
open system capable of adjusting itself to the changing environment. Hence, organization is a
socio-technical system whose sub-systems are tasks, people, technology, culture and structure,
each having its own input and output satisfying at first its own objectives and eventually the
corporate organization’s goals and objectives. If the subsystem’s goals and objectives are not
congruent with the corporate objectives, poor performance, resistance to change and non-
attainment of corporate goals will be the consequences.
The system and their goals are not stable. The goals change in response to the changes in the
business focus, the environment and in the people in the organization. A significant change
calls for change in the organization structure.
A goal displacement is said to have occurred when the system goals replace the organization
system goals. When a goal displacement occurs, it affects the organization’s goals significantly.
Another reason for goals change is due to the natural process of growth and decline. This
phenomenon is best described by a Sigmoid or S curve (Fig. 1.7). All organizations and their
business go through the different phases of growth cycle in stages as, introduction, growth,
maturity and decline. Each phase generates new goals to be served. If the changed or displaced
goals are not reflected in the organization as a system, the organization starts decaying

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1.8) MIS: Strategic Business Planning
Strategic Biz planning is an essential management process to keep the biz competitive:
1. Market forces
2. Technological change
3. Complex diversity of business
4. Competition
5. Environment (Threats, Challenges, and Opportunities)
Peter Drucker defines long-range planning as the process of making the present managerial (risk
taking) decisions systematically and with the best possible knowledge of their futurity,
organizing systematically the efforts needed to carry out these decisions and measuring the
results of these decisions against the expectations through organized systematic feedback.
Planning is neither forecasting nor making future decisions today; it is making current decisions
in the light of future.

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1.9) Concept of Corporate planning
Planning does not eliminate the risk but provides an effective tool to face it. Comprehensive
corporate planning is not an aggregate of the functional plans, but it is a systematic approach
aiming to manoeuvre the enterprise direction over a period of time through an uncertain
environment, to achieve the stated goals and the objectives of the organization
1.10) Essential of Strategic Planning
Planning, long-range or short-range, strategic or tactical, involves a series of decisions to be
taken by the managers in the organization. Decisions relate to several aspects of corporate
business planning. There are a number of alternatives, choices and options available while
planning the business. Further, there is selection of resources and their allocation in an
optimum manner to maximize the gains. Then there is selection of methods whereby the efforts
at all the levels are coordinated towards a common goal and direction. The planning, therefore,
involves decision-making with the help of tools. These tools are based on one or more factors.
These factors are:
Creativity: When decision-making is called for a situation which has no precedent then creativity
is the only tool to resolve the problem of decision-making
Systems approach: Helps to understand the situation with clarity. It helps to sort out the factors
on the principles of critical and non-critical, significant and insignificant, relevant and irrelevant,
and finally controllable and uncontrollable. It tests the solutions for feasibility — technical,
operational and economic. The systems approach is a way of looking at a problem in a
systematic manner using the scientific methods and applying the principles of a rational
decision-making to solve the problem.
Sensitivity analysis: Helps to test the validity of the solution in variable conditions. Sensitivity
analysis requires to know whether the solution will still remain valid if the assumptions changed,
constraints were relaxed and new conditions emerged. It helps to assess the impact of change on
the solution in economic terms. Sensitivity analysis helps to test the solutions on the principle of
utility. A solution which is economically rational and is based on a sound business principles may
be rejected on the principle of utility. It uses techniques such as the decision tree analysis,
methods of discounting, payoff matrix, simulation, and the modeling
Biz Modeling: A model is a meaningful representation of a real situation on a mini scale, where
only the significant factors of the situation are highlighted. The purpose of a model is to
understand the complex situation based on only the significant factors. The Business Model
(BM) is a simpler way of representing complex framework of business operations and how they
deliver [Link] are several types of models.
Physical model; Scale model; Mathematical model like break even analysis model, linear
programming model, queuing model, network model, etc.

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1.11) Balance Score card (BSC), Score Card (SC) & Dash Board (DB)
From the view point of MIS, it can be said that BSC provides a clear platform to work upon to
develop information system to support. BSC implementation information systems should be
designed to capture data and process it to analyse and evaluate BSC effectiveness in attaining the
business performance and organisation development.
The balance score card is a strategic planning and management tool that is used in organizations
to align business activities to the vision and strategy of the organization. It was originated by Dr.
Robert Kaplan and Dr. David Norton as a performance measurement framework that added
strategic non-financial performance measures to traditional financial measures represent a more
‘balanced’ view of organizational performance.
Unlike the traditional approach which rely on accounting data, BSC takes a comprehensive
balance view of four business aspects; Finance, Process, People and Customer. The view talks
about objectives, measures, targets and initiatives in these four aspects of the business.
Advantage of BSC is that it clarifies the organization’s vision and enables to think in terms of
clear strategy for action. BSC deals with internal business processes and their outcomes, and
impact of outcomes on business performance. BSC approach recommends view of organization
in four perspectives with setting clear vision and then for evolving effective competitive
strategy. The perspectives are
• The learning and growth HR perspective
• The business process perspective
• The customer perspective
• The financial perspective

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Benefits of BSC approach to strategic management of business can be summarized as follows:
• It helps link performance measures to strategy at all levels in the organization i.e. strategy –
plan and action, operations, and outcomes and impact on targets.
• It provides a multidimensional comprehensive view of operations and performance, and its
impact on vision and target.
• People (Customers, Suppliers, Employees) have one method (BSC) to understand and
communicate vision, goals, strategies, plan, action, targets and achievements.
• Generates business knowledge on continuing basis through strategic feedback to be come a
learning organization.
Score card and Dashboard are tools for displaying, trending, analyzing and executing actions to
improve performance using the balanced scorecard concepts. The score card and dash board are
the tools used for assessing and monitoring the business performance and the process
performance which achieves it. A majority of organizations have adopted scorecards and dash
boards as their preferred way of viewing performance information
Dashboards and scorecards represent the culmination of business intelligence. A dashboard or
scorecard interface finally makes it easy for a majority of key managers to quickly find, analyze,
and explore the information they need to perform their jobs on a daily basis.

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Dashboards monitor and measure processes performance. more real-time in nature. Dashboards
provide alignment, visibility and collaboration across the organization by allowing decision
makers to defi ne, monitor and analyze business performance and business strategy via key
performance indicators (KPIs).
Scorecard charts progress at a point of time, day, week or month towards reaching objective. Its
built for key result areas in business operations by choosing Key Operations Indicators.
Dashboard informs executives how processes are doing and a scorecard tells them how well they
are doing. In other words, a dashboard records performance while a scorecard charts progress.
Dashboard is a performance monitoring system, whereas a Scorecard is a performance
management system.
Dashboards and scorecards are mutually exclusive and hence both are required for use to do
well in business. Dashboards measure performance against key business objectives. Score cards
empower users with actionable information to change business outcomes

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1.12) Security Challenges in E- Enterprises
As business organizations have moved into E-enterprise mode, it has raised certain issues in the
areas of Secrecy, Privacy, Confidentiality, Destruction and Theft of information and information
systems. These issues assumed more importance when business processes are managed through
internet and telecommunication networks. The security threats are posed from internal as well as
external sources of the organization. There are five reasons, which affect the security of the
information and information systems. The reasons are:
• Destruction
• Deletion
• Bugs infection
• Theft
• Corruption
The threat to information and information systems could be accidental or malicious, and it could
get generated from personnel within the organization who have an authorized access or from
personnel who are not authorized to access the system. The security challenges need to be met on
three fronts:
• Prevention
• Limitation
• Protection
One more challenge is to setup a system of recovery, should the system is affected for any
reason. All this is possible through a formal security management system (SMS). The security
management system, therefore has to have goals to control the impact of security threat to
business. Security Management System is designed to meet security threats and has the
following scope:
• Identification of threat sources and possibilities of its occurrence.
• Protecting the Information and information system from unauthorized access.
• Ensure the privacy of individual and personal information.
• Check the misuse of information obtained from unauthorized access.
• Provide methods/systems to recover from damage and put the ISon track for normal use.

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The vulnerability of the systems to security threats can be met effectively only with Security
Management Systems (SMS) with specific following objectives:
• Minimise the loss of physical and information assets.
• Minimise the loss of business or business opportunities.
• Ensure system integrity and reliability of data.
• Keep quality of information systems highest.
• Recover fast from any disaster.
Threats to information systems are caused from several sources and reasons. All the reasons can
be put in three classes namely failure of system, human actions, and damage due to natural
calamities.
• Failure of system: Hardware, Software, Network, and Telecommunication functioning.
• Human actions: Illegal access, Theft, User Errors, Program changes.
• Natural Calamities: Fire, Earthquake, Floods.

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The entire SMS works with security controls designed for specifi c purpose and introduced at
appropriate place. Security controls can be explained by classifying them in different categories
as shown in Table 4.1.

Security measures in E-business have to be enabled. Successful Measures are:

• Firewall: Prevent unauthorized user’s access.
• Encryption: Prevent reading of information, messages, reports.
• Authentication: Confirm the authenticity of a claim of other party.
• Message Integrity: Ascertaining that communication content is not disturbed.
• Digital Signature: Confirmation of sender’s authenticity
Disaster management plan (DMP). DMP is a plan of action to recover from the impact on the
information systems. They are either collapsed or dysfunctional. You need a recovery process to
start them all over again. DMP also provides guidance on how to keep organization running
while DMP is being acted upon. DMP plan includes measures such as following:
• Alternative processing arrangements.
• Duplicate and offsite storage of data, hardware and software.
• Choice of systems and Applications, which should run, in any case

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Information security Risk Management:
Let us know the terms used in risk management through information security measures.
• Risk = Threat to asset × Vulnerability of asset.
• Risk Factor: Probability of risk occurrence. A threat turning into a reality.
• Risk exposure: Risk factor × Money value of the damage on risk occurrence.
• Threat: Actions, activities, situations, events which would harm information and systems.
• Degree of threat: Depends on potential capability of threat agent.
• Vulnerabilities: Weaknesses, shortcomings in systems, people, technology that allow a threat to
become effective reality
The ISO/IEC 27002:2005 Code of practice for information security management recommends
the following for examination during a risk assessment and its management:
• Security policy
• Organization of information security
• Asset management
• Human resources security
• Physical and environmental security

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• Communications and operations management
• Access control
• Information systems acquisition, development and maintenance
• Information security incident management
• Business continuity management
• Regulatory compliance
In broad terms, the risk management process consists of:
• Identification of assets.
• Estimating their value. Include: people, buildings, hardware, software, data (electronic, print,
other), supplies.
• Conduct a threat assessment. Include: Acts of nature, acts of war, accidents, malicious acts
originating from inside or outside the organization.
• Conduct a vulnerability assessment, and for each vulnerability, calculate the probability that it
will be exploited.
• Evaluate policies, procedures, standards, training, physical security, quality control, technical
security.
• Calculate the impact that each threat would have on each asset. Use qualitative analysis or
quantitative analysis.
• Identify, select and implement appropriate controls.
• Provide a proportional response. Consider productivity, cost effectiveness, and value of the
asset.
• Evaluate the effectiveness of the control measures.
• Ensure the controls provide the required cost effective protection without discernible loss of
productivity.
Management can choose risk management policy based upon value of the asset, frequency of
occurrence, and the impact on the business.

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A broad classification structure is suggested for customization by each organization meeting its
value proposition and security environment needs.

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1.13) Impacts of Information Technology on society.
Individuals and organisations exist in a society in a social environment. Technology affects this
existence, due to impact on privacy, culture, job opportunities, and markets. Government,
Business, Individuals and Organizations are changing to new social and environment order
creating a new society. In summary, IT applications affect individuals, their family, work groups,
organization and business at large. It threatens the violation of privacy of individual or a work
group or organization. It affects, favorably, the cost of job and time taken to complete but it has a
negative impact on job opportunities, puts pressure on job holder to learn continuously, raises
stress level due to continuous impending job insecurity. It reduces social interaction in the job as
most of the business processes are de-humanised due to extensive use of IT application on the
positive side. Information Technology has contributed to material progress by way of reduced
cost, faster delivery, better quality, functions and features in the product and variety of product
options to the consumer. The question, therefore, arises whether it is ethical to use IT so
aggressively and accept its negative impact. Issue, therefore, is how to balance benefits of IT
against its negative impact and also be ethical in handling the social issues.

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