UNIT – 1
Management Information System
1.1.1 Definition
MIS is an organized integration of technologies, data, processes, and human elements of hardware and software. It is a software system that focuses on information technology management in order to provide effective and efficient strategic decision-making.
For Management Information Systems, MIS is the acronym. MIS is a set of the procedures which provide information to support decision making when executed.
An integrated user-machine system is a Management Information System used for
● For data provision.
● To support the functions of operations, management, analysis, and decision-making.
● The system uses Computer Hardware & Software Manual Procedures Models for analysis, planning, control, and decision-making in an organization, and a database.
MIS Meaning: A management information system is an acronym of three words, viz., Management, information, system.
Let us try to understand these three words in order to fully comprehend the term MIS:
Management: Management is the art of getting things done in formally organized groups, through and with people.
Information: Information is data that is processed and presented in a form that helps to make decisions. It may contain a surprise element, decrease uncertainty or cause an action to be initiated by a manager.
System: A system is an orderly grouping of interdependent components linked together to achieve a particular goal according to a plan. Because of its use in various contexts, the term system is the most loosely held term in management literature.
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Major components of MIS are:
● People Resources: People are required for the operation of all of the information system.
● Data Resources: Database holds processed and well organized data.
● Software Resources: It includes all set of information processing instruction and commands.
● Hardware Resources: Include all physical devices and materials required for information processing.
● Process: is a step undertaken to achieve a desired goal.
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The goal of MIS is given in detail below.
Data Capturing: MIS collects information from various internal and external sources within the company. Data collection may take place manually or via computer terminals.
Processing of Data: Captured data is processed in order to be converted into the information required. Data is processed by activities such as calculating, sorting, classifying, and summarizing.
Storage of Information: For future use, MIS stores the data processed or unprocessed. If any data is not immediately required, it is saved for later use as an organizational record.
Retrieval of Information: As and when required by different users, MIS retrieves information from its stores.
Dissemination of Information: Information, which is a completed MIS product, is disseminated to users within the company. It is available regularly or online through a computer terminal.
Characteristics of MIS:
- System Approach
- Management Oriented
- Need-Based
- Exception Based
- Future Oriented
- Integrated
- Long Term Planning
- Sub-System Concept
- Central Database
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- System Approach
The information system follows the principles of a system. The approach of the system implies a holistic approach to the system's study and its performance in the light of the objective for which it has been established.
2. Management Oriented
While designing the MIS, the top-down approach must be followed. The top-down approach suggests that the development of the system begins with the determination of management needs and general business goals.
From the overall business plan, the MIS development plan should be derived. The management-oriented feature of MIS also means that management actively directs the efforts to develop the system.
3. Need-Based
The design and development of MIS should be in accordance with the information requirements of managers at different levels, level of strategic planning, level of management control and level of operational control. In other words, MIS should cater to the specific needs of managers within the hierarchy of an organization.
4. Exception Based
The MIS should be developed on the basis of an exceptional reporting principle, meaning an abnormal situation, i.e. a maximum; the minimum or expected values vary beyond the limits of tolerance. In such situations, the BE exception should be reported at the required level to the decision-maker.
5. Future Oriented
MIS should also look at the future in addition to exception-based reporting. In other words, MIS should not merely provide historical or past information; rather, it should provide information based on projections that can be used to initiate actions.
6. Integrated
Integration is a necessary characteristic of an information system for management. Due to its ability to produce more meaningful information, integration is significant.
For example, To develop an effective production scheduling system, it is necessary to balance such factors as setup costs, Workforce, Overtime rates, Production capacity, Inventory level, Capital requirements & Customer services.
7. Long Term Planning
Over relatively long periods, MIS is generated. Such a program does not evolve overnight. A heavy planning element is involved. The MIS designer must have the company's future goals and needs in mind.
8. Sub-System Concept
The MIS development process is quite complex, and one is likely to frequently lose insight. Thus, although viewed as a single entity, the system must be broken down into digestible sub-systems that at the planning stage are more significant.
9. Central Database
A mortar that holds the functional systems together is a central database. Each system requires access to the master data file covering inventory, staff, suppliers, clients, etc. Collecting data once, validating it properly and placing it on a central storage medium that can be accessed by any other subsystem seems logical.
Systems are made up of numerous sub-systems, each with elements, interactions, and goals. Subsystems carry out specialized tasks linked to the overall goals of the overall system.
On more than one level, a system exists and can be composed of subsystems or component parts.
The following are the Management Information System subsystems of:
- Transaction Processing System.
- Management Reporting System.
- Decision Support System.
- Office Information System.
- Business Expert System.
Transaction Processing System - An exchange between two or more business entities is defined as a transaction. Total processing of transactions, also known as data processing, reflects a company's main business activities such as sales, manufacturing, inventory, shipping, receiving, billing, accounts payable, accounts receivable, payroll, general ledger, etc. Transactions are important events for an organization, and transaction processing is called collecting data about them.
The main purpose of the Transaction Processing System is to record, process, validate, and store transactions that take place for future recovery and use in the various functional areas of a company. Transaction processing systems are cross-functional information systems that process information resulting from business transactions occurring.
● For a company, a TPS records internal and external transactions.
● A TPS performs repetitive and routine tasks. In order to make operational decisions, it is mostly used by lower level managers.
● In batch mode or online, transactions can be recorded. Files are updated periodically in batch mode; and, in online mode, each transaction is recorded as it happens.
● TPS is a six-step process that supports data entry, data capture, data validation, processing and re-validation, storage, generation of output and query.
Management Reporting System - The most elaborate of management-oriented MIS components are Management Reporting Systems. Its main goal is to provide printed reports and investigation capabilities for lower and middle management to help maintain enterprise operational and management control.
● MRSs are usually created by professionals in the information system, rather than by end users.
● Instead of projecting the future, MRSs are geared towards reporting on the past and present.
● MRSs report on internal company activities in large part.
● Generally, MRSs have restricted analytical capabilities.
● MRSs do not support the decision-making process directly.
● Scheduled or periodic reports, exception reports, and demand or ad hoc reports are provided by MRSs.
Decision Support System - Decision support systems are a class of computerized information systems that support the activities of decision-making. DSS are computer-based interactive systems and subsystems that are intended to assist decision-makers. A DSS may graphically present information and may involve an expert system or artificial intelligence. DSS tends to be primarily designed to serve managers at the level of management control and strategic planning.
● DSSs support semi-structured and unstructured issues for decision-makers.
● DSSs are more focused on particular decisions rather than routine information flows.
● DSS graphically presents information and may include an expert system or artificial intelligence.
● DSSs, over time, are adaptive.
Office Information System - The Office Information System is an information system that uses hardware, software and networks to improve the flow of work and improve employee communication. The application of computer and communication technology to office functions refers to office automation. Office automation systems are designed to enhance managers' productivity at different management levels by providing secretarial assistance and better communication facilities.
The combination of hardware, software and people in information systems is office automation systems, which process office transactions and support office activities at all levels of the organization. These systems include a broad range of support facilities, including word processing, electronic filing, electronic mail, switching messages, data storage, communication of data and voice, etc.
Business Expert System - A knowledge-based information system that uses its knowledge of a specific, complex application area to act as an expert is a business expert system. One of the information systems based on knowledge is this system. In the form of advice from an expert in a particular problem area, the Expert System provides decision support to managers. In various areas, ranging from medical, engineering and business, expert systems are applied.
Key Takeaways:
- MIS is an organized integration of technologies, data, processes, and human elements of hardware and software. It is a software system that focuses on information technology management in order to provide effective and efficient strategic decision-making.
- The approach of the system implies a holistic approach to the system's study and its performance in the light of the objective for which it has been established.
- Total processing of transactions, also known as data processing, reflects a company's main business activities such as sales, manufacturing, inventory, shipping, receiving, billing, accounts payable, accounts receivable, payroll, general ledger, etc.
- The combination of hardware, software and people in information systems is office automation systems, which process office transactions and support office activities at all levels of the organization.
Planning - For example, top-level management is primarily concerned with strategic planning. For example, top management strategic planning activities involve future interaction between the organization and its external environment.
Planning Computational Support:
1. Historical data analysis to obtain a relationship that is useful for projection.
2. Various techniques for projection and forecasting to estimate future value.
3. Internal plan computations and the computation required for outputs.
4. Output in a meaningful planning format of the results.
Historical data analysis techniques
Analyzed historical data to discover patterns or relationships that will be useful in projecting the future value of variables of significance. Even if the quantitative relationships are not sufficiently stable to be used for forecasting data analysis, input into the judgmental forecast is useful.
Historical extrapolation techniques
Historical data describes past planning that involves future estimation, usually based on historical analysis combined with different techniques to generate information for planning purposes.
Financial planning computation
Depreciation computation rate of return analysis and break even analysis are models that include financial plan need to provide different computations and analyzes commonly needed to measure or evaluate profitability examples. In most financial planning, depreciation is an important calculation that affects profit calculation because it is an expense and because of its impact on taxes, it affects cash flow. There are several methods available to the planner for computer deprecation, all of which should be accessible. These techniques are straight line double declining balance sum of the digits of the year and basis of production or use.
Controlling - Information is managerial control at the middle level of management. Managers at the middle level, such as departmental heads, are concerned with their units' current and future performance. They therefore need aggregate data on sales, profit, etc. Such information is available from both within and outside the organization of their units, such as financial data for budgets and ratio analysis from the company's records.
However, by means of special surveys and reports from outside the organization, market data can be collected. Top level managers also require information about management control. However, this information must be smaller in scope and more precise in detail than the information required for strategic planning. It should also occur more frequently because the decision time horizon is shorter. Examples of operational control are production scheduling, cost and credit control, etc., exercised at the supervisory level of management operational control. Therefore, a detailed report on a daily and weekly basis is required. Examples of such information are inventory report, operating costs, production rate, etc. Such data is available from within the company.
For system design, the control feedback loop is basic. In several ways, the computer can enhance the control process:
1. This standard can be complicated. There is no need for computational simplifications.
2. Deviation calculation and cause identification can be more sophisticated.
3. Computer reporting may use irregular time intervals, which are very difficult and can be done more frequently with manual processing.
Limitation
1. Aggression - People can hit the system back and may even sabotage it by incorrectly using equipment by putting incomplete information into the system or purchasing actual hardware or software destruction.
2. Projection - It is a psychological mechanism to blame someone or something else for difficulties. The projection takes place when employees blame the management information system for problems caused by human error or other factors unrelated to the system.
3. Avoidance - It happens when people, by withdrawing from or avoiding a frustrating situation, defend themselves. By ignoring its output, managers may avoid the system, in favor of their own sources of information.
Management Information System Planning - General business planning of the Management Information System begins with the following concepts:
1. Corporate Mission.
2. Corporate objectives and goals in all key areas of performance. These are alignments of
With a corporate mission.
3. Strategic planning for an overall approach to how long-term objectives can be achieved.
4. Operational planning for specific guidance on the transformation of short-term milestones
Many organizations successfully use MIS, and others do not. Although the hardware and software are the newest and have adequate technology, their use is more for data collection and storage and basic processing. There are some variables that make it a success for the MIS and some others that make it a failure. You can summarize these factors as follows:
Factors Contributing to Success
If a MIS is to be successful, all the characteristics should be listed as follows:
● MIS is incorporated into the management functions. It sets clear goals to ensure that the MIS focuses on the company's main questions.
● Appropriate information processing technologies are selected to meet the data processing and analysis needs of MIS users.
● In terms of user requirements, the MIS is oriented, defined and designed and its operational viability is ensured.
● The MIS is maintained under continuous surveillance in order to modify its open system design according to changing information needs.
● MIS focuses on the outcomes and objectives, highlighting the non-achievement variables and reasons.
● MIS is not permitted to end up in an information generation facility to prevent information and communication system noise.
● The MIS acknowledges that a manager is a human being and, therefore, in the management process, the systems must consider all the human behavioral factors.
● The MIS acknowledges that the various information requirements for different objectives must be met. In isolation from the various goals, the globalization of information leads to too much information and information and its non-use.
● The MIS is simple to operate and therefore the MIS design has such characteristics that make up a user-friendly design.
● MIS acknowledges that the requirements for information are obsolete and new needs are emerging. Therefore, the MIS design has a fundamental potential capability to satisfy new information needs quickly.
● MIS focuses on the development of data support for critical success factors for managers. It focuses on the critical applications of the mission that serve the needs of top management.
Factors contributing to failure
MIS is, many times, a failure. As follows, the common factors responsible for this are listed:
● The MIS is designed as a processing system for data and not as an information processing system.
● The MIS does not provide the information the managers need, but tends to provide the information usually called for by the function. The MIS then becomes a system that is impersonal.
● Underestimating and not recognizing the complexity of the business systems in the MIS design leads to problems in successful implementation.
● The quality control aspects of the inputs, processes and outputs, which lead to insufficient controls and controls in the MIS, are not given adequate attention.
● MIS is developed without streamlining the organization's transaction processing systems.
● Lack of training and appreciation that information users and data generators differ, and that they have an important responsible role to play in the MIS.
● The MIS does not meet some of its users' critical and key factors, such as a response to the database query, an inability to perform the processing in a specific way, lack of a user-friendly system, and reliance on system staff.
● A belief that all the management problems of business planning and control can be solved by computerized MIS.
● Incomplete and incorrect information results from a lack of administrative discipline in following the standardized systems and procedures, wrong coding and deviating from the system specifications.
● MIS does not provide all the users in the organization with perfect information.
Key Takeaways:
- Even if the quantitative relationships are not sufficiently stable to be used for forecasting data analysis, input into the judgmental forecast is useful.
- Many organizations successfully use MIS, and others do not. Although the hardware and software are the newest and have adequate technology, their use is more for data collection and storage and basic processing.
- MIS is not permitted to end up in an information generation facility to prevent information and communication system noise.
- The MIS acknowledges that a manager is a human being and, therefore, in the management process, the systems must consider all the human behavioral factors.
Marketing & Sales Systems
The Marketing Management Information System (MIS) supports product development, distribution, pricing decisions, promotional efficiency and sales forecasting managerial activities.
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Inputs to Marketing MIS
● Strategic Plan and Corporate Strategies
● The TPS
● External sources:
● The rivalry
● The market
MIS Subsystems and Outputs Marketing
● Marketing research studies
● Web-based market studies
● Development of products
● Advertising and promotion
● Pricing of products
Finance & Accounting Systems
Financial MIS All financial managers within an organization are provided with financial information. This integrates financial & operational data from various sources.
By providing fast financial data, Financial MIS facilitates analysis. This allows financial analysis of various aspects; time, product, customer. One can analyze historical and current data with Financial MIS. One can also track the use of funds. Costing, P&L reporting, auditing, management of funds, etc. are some examples or functions of Financial MIS.
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Inputs to the Financial Information System
● Strategic Plan or Corporate Strategies
● Contains significant financial goals and often projects financial needs.
● System of transaction processing (TPS)
● Important financial information from nearly every TPS collected - payroll, payroll,
● Inventory control, order processing, payable accounts, receivable accounts, general ledger.
● External sources
● Competitors' annual reports and financial statements and general news items.
● Subsystems and Outputs for Financial MIS
● Financial subsystems
● Profit/loss and expense systems
● Auditing
● Internal auditing Inside auditing
● External auditing External auditing
● Applications and management of funds
Manufacturing & Production Systems
One component of a manufacturing MIS that relies on the production schedule is inventory control programs. Inventory control programs can forecast future production, reorder items automatically when a certain threshold is met, determine manufacturing costs, and develop production schedule resource requirement plans. Manufacturing Requirements Planning (MRP) programs allow thousands of inventory items to be coordinated when demand for one item depends on demand for another. When finished products are required, MRP systems determine, then work backward to determine deadlines and resources needed to complete the final product on schedule. The money of a company is tied up in unused inventory when high inventory levels are maintained. This implies higher costs for the organization. A Just-in-time (JIT) inventory approach ensures that only when they are needed are inventory and materials delivered. This keeps inventories at their lowest level possible, but ensures that materials are on-hand for production in time. Although JIT is beneficial, whether internal or external, it also makes a company vulnerable to supply chain disruptions. For example, if a machine breaks down and a component needs to be assembled by another unit, the assembly may have to stop due to a lack of components.
To control and streamline the manufacturing process, technologies have been developed. Using computer assisted manufacturing software, computers can control manufacturing equipment directly. All aspects of production are linked together by computer-integrated manufacturing software, including order processing, product design, manufacturing, quality control, and shipping. After an engineer designs a product using CAD software, for example, MRP systems can use design information as input to plan and order materials. The design specifications can be used by production scheduling systems as an input to the scheduling process. And the design specifications can be used by computer-aided manufacturing systems as input for setup.
This greatly enhances the efficiency of production. A flexible manufacturing system allows a facility to change from one product to another quickly and efficiently, often using robotics and other automation. The changeover is usually computer controlled. Finally, for manufacturing firms, quality control has become paramount. For monitoring product quality, control charts or sample testing are used. Subsystems and outputs of the production MIS monitor and control the flow of materials, products and services through the organization.
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Inputs to the Manufacturing MIS
● Strategic strategy or corporate policy.
● The TPS:
● Processing of orders
● Data on inventory
● Data receiving and inspection
● Personnel data
● Process of production
● External sources
Manufacturing MIS Subsystems and Outputs
● Engineering and design
● Scheduling of master production
● Inventory control
● Planning of production resources
● Inventory and production just-in-time •
● Control of processes
● Computer-assisted production (CAM)
● Computer-integrated production • (CIM)
● Flexible system of production
● Control and testing of quality
Manufacturing MIS
● Planning of material requirements (MRP)
● Determine when you need finished goods
● Set deadlines accordingly
● Planning of production resources (MRPII)
● Scheduling the network
● Improve service and productivity for customers
● Inventory system just in time (JIT)
● Inventory and materials shipped prior to use
Human Resources MIS:
The Human Resource Management Information System (MIS) deals with all the activities related to the organization's employees and potential employees.
Information systems for human resources management are concerned with activities related to employees, managers, and other individuals employed by the organization. The human resources management information system plays a valuable role in ensuring organizational success because the staff function relates to all other areas in business. Activities carried out by information systems for human resources management include work-force analysis and planning, recruitment, training, and job assignments.
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Inputs to the Human Resource MIS
● Strategic Plan or Corporate Strategies
● The TPS:
● Data on payrolls
● Order data processing
● Personnel data
● External sources
Subsystems and outputs of Human Resource MIS
● Planning for human resources
● Selection of personnel and recruiting
● Inventory of training and skills
● Scheduling and the placement of jobs
● Salary and wage administration
Key Takeaways:
- The Marketing Management Information System (MIS) supports product development, distribution, pricing decisions, promotional efficiency and sales forecasting managerial activities.
- Inventory control programs can forecast future production, reorder items automatically when a certain threshold is met, determine manufacturing costs, and develop production schedule resource requirement plans.
- A Just-in-time (JIT) inventory approach ensures that only when they are needed are inventory and materials delivered. This keeps inventories at their lowest level possible, but ensures that materials are on-hand for production in time
- The Human Resource Management Information System (MIS) deals with all the activities related to the organization's employees and potential employees.
Different organizational levels are served by three main categories of information systems: operational systems, management systems, and strategic systems. By keeping track of the organization's basic activities and transactions, such as sales, receipts, cash deposits, payroll, credit decisions and the flow of materials in a factory, operational-level systems support operational managers. At this level, the primary purpose of systems is to answer routine questions and to monitor the flow of transactions through the organization.
Examples of operational-level systems include a system for recording bank deposits from automatic teller machines or one that monitors the number of hours employees work on a factory floor each day.
The monitoring, control, decision-making, and administrative activities of middle managers are served by management-level systems. The main question addressed by such systems is this: Are things functioning well? Typically, management-level systems provide periodic reports rather than instant operating information. An example is a relocation control system that reports on the total costs of employees in all company divisions for moving, house-hunting, and home financing, noting where actual costs exceed budgets.
Non-routine decision making is supported by some management-level systems. They tend to focus on less-structured choices for which the requirements for information are not always clear. "What-if" questions are often answered by these systems:
If we were to double sales in the month of December, what would the impact on production schedules be? What would happen to our return on investment if six months were delayed by a factory timetable? Answers to these questions often require new data from outside the company, as well as information from within that can not be easily obtained from existing operational-level systems.
Strategic-level systems, both in the company and in the external environment, help senior management address and address strategic issues and long-term trends. Matching changes in the external environment with existing organizational capacity is their main concern. What are the job levels going to be in five years? What are the cost trends of the long-term industry, and where does our firm fit in? In five years, what products should we be making?
The main business functions, such as sales and marketing, production and production, finance and accounting, and human resources, are also served by information systems. For each functional area, a typical organization has operational-, management-, and strategic-level systems. For instance, the sales function usually has an operational-level sales system to record daily sales figures and to process orders. A system at the management level tracks monthly sales figures by sales territory and reports on territories where sales are above or below expected levels. A scheme
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Decision support systems (DSS) are software-based interactive systems designed to assist decision-making managers by accessing large volumes of information generated from various related information systems involved in organizational business processes, such as the office automation system, the transaction processing system, etc.
Using analytical models, DSS uses summary data, exceptions, patterns, and trends. In decision-making, a decision support system helps but does not necessarily give a decision itself. To identify and resolve problems and make decisions, decision makers compile useful information from raw data, documents, personal knowledge, and/or business models.
Programmed and Non-programmed Decisions
There are two types of decisions - programmed and non-programmed decisions.
Programmed decisions are basically automated processes, general routine work, where −
● Such decisions have been adopted several times.
● Some guidelines or rules are followed by these decisions.
Selecting a reorder level for inventories, for example, is a scheduled decision.
In unusual and non-addressed situations, non-programmed decisions happen, so
● It would be a new decision.
● There won't be any rules to be followed.
● Based on the information available, these choices are made.
● These choices are based upon the discretion, instinct, perception and judgment of the manger.
For instance, a non-programmed decision is to invest in a new technology.
In general, Decision Support Systems involve non-programmed decisions. For these systems, therefore, there will be no exact report, content, or format. On the fly, reports are generated.
DSS attributes
● Adaptability and versatility
● High interactivity level
● Simplicity of use
● Efficiency and efficacy
● Full control by decision makers
● Ease of creation
● Extendibility
● Modeling and analysis support
● Support to access data
● Standalone, built-in, and Web-based
Characteristics of a DSS
● Support for semi-structured and unstructured problems for decision-makers.
● Support for executives at various levels of management, ranging from top executives to line managers.
● Support for people and groups. The participation of several individuals from different departments and organizational levels often requires less structured issues.
● Support for decisions that are interdependent or sequential.
● Intelligence, design, choice, and implementation support.
● Support for a variety of styles and decision processes.
● DSSs, over time, are adaptive.
Benefits of DSS
● Improves the effectiveness and speed of decision-making operations.
● Increases the organization's control, competitiveness and capability of futuristic decision-making.
● Ease interpersonal communication.
● Encourages study or training.
● Since it is mostly used in non-programmed decisions, new approaches are revealed and new evidence for an unusual decision is established.
● Helps automate procedures for management.
● DSS Components
● Database Management System (DBMS) − The necessary data may come from internal or external databases to solve a problem. In an organisation, a system such as TPS and MIS generates internal data. External information comes from a number of sources, such as newspapers, online data services, databases, etc (financial, marketing, human resources).
● Model Management System - It stores and accesses models used by executives to make decisions. Such models are used to design manufacturing facilities, to analyze an organization's financial health, to forecast demand for a product or service, etc.
● Support Tools − Support tools such as online help, pull down menus, user interfaces, graphical analysis, error correction mechanism, facilitate system user interactions.
DSS Classification
There are several ways of categorizing DSS. DSS is defined by Hoi Apple and Whinstone as follows.
● Text Oriented DSS − It contains textually represented information that could have a bearing on decision. It allows documents to be electronically created, revised and viewed as needed.
● Database Oriented DSS − Here, the database plays a significant role; it contains organized and highly structured information.
● Spreadsheet Oriented DSS - Includes information in spreadsheets that enables procedural knowledge to be generated, viewed, modified and also instructs the system to execute self-contained instructions. Excel and Lotus 1-2-3 are the most popular tools.
● Solver oriented DSS - It is based on a solver, which is an algorithm or procedure written to perform certain calculations and specific kinds of program.
● Rules Oriented DSS - certain procedures adopted as rules are followed.
● Rules Oriented DSS - In rules-oriented DSS, procedures are adopted. The export system is an instance.
● Compound DSS - It is constructed using two or more of the above five structures.
Types of DSS
● Status Inquiry System − It helps to take decisions on operational, management level or middle level management, such as daily schedules of machine jobs or machines for operators.
● Data Analysis System − It requires comparative analysis and uses a formula or an algorithm, such as analysis of cash flow, inventory analysis, etc.
● Information Analysis System − Data is analyzed in this system and an information report is generated. Sales analysis, account receivable systems, market analysis, etc., for example.
● Accounting System − It keeps track of information related to accounting and finance, for example, final account, receivables of accounts, payables of accounts, etc., which keep track of the company's main aspects.
● Model Based System − Simulation models or optimization models used for decision-making are rarely used and provide general operational or management guidelines.
Key Takeaways:
- Different organizational levels are served by three main categories of information systems: operational systems, management systems, and strategic systems
- The main business functions, such as sales and marketing, production and production, finance and accounting, and human resources, are also served by information systems.
- Using analytical models, DSS uses summary data, exceptions, patterns, and trends. In decision-making, a decision support system helps but does not necessarily give a decision itself
- In general, Decision Support Systems involve non-programmed decisions. For these systems, therefore, there will be no exact report, content, or format
