BUS 330 - Chapter 10
Problem Solving Process: Monitoring Stage (Definition)
The final stage of the problem solving process in which decision makers evaluate the implementation to determine whether the anticipated results were achieved and and to modify the process in light of new information. - Monitoring can involve feedback and adjustment.
Decision Making Phase (Definition)
The first part of problem solving, including three stages: intelligence, design, and choice
What are the most significant internal data sources for a Management Information System (MIS)
The most significant internal data sources for an MIS are the organization's various TPS and ERP systems and related databases
Goals of Material Requirements Planning (MRP)
To determine when finished products, such as automobiles or airplanes, are needed and then to work backward to determine deadlines and resources needed, such as engines and tires, to complete the final product on schedule.
What is the primary purpose of a Management Information System (MIS)?
To help an organization achieve its goals by providing managers with insight into the regular operations of the organization so that they can control, organize, and plan more effectively
Information Subsystems and Outputs in Manufacturing: Master Production Scheduling
To provide detailed plans for both short-term and long-range scheduling of manufacturing facilities.
Decision Support Systems (DSSs) are used when the problems are:
Unstructured
When is satisficing used?
Used when modeling the problem properly to get an optimal decision would be too difficult, complex, or costly
What can business intelligence be used to turn a database into?
Useful information throughout the organization
Companies use data ___ and data ___ to store valuable business information.
Warehouses; Marts
Geographic Information Systems (GIS) (Definition)
- A computer system capable of assembling, storing, manipulating, and displaying geographically referenced information, that is, data identified according to its location.
Human Resource Management Information Systems (HRMISs) (Definition)
- Also called the personnel MIS - Concerned with activities related to previous, current, and potential employees of the organization - Because the personnel function relates to all other functional areas in the business, the HRMIS plays a valuable role in ensuring organizational success.
Heuristics
- Also known as "rules of thumb," - Commonly accepted guidelines or procedures that usually find a good solution
Flexible Manufacturing System (FMS)
- An approach that allows manufacturing facilities to rapidly and efficiently change from making one product to another - By using an FMS, the time and cost to change manufacturing jobs can be substantially reduced, and companies can react quickly to market needs and competition
Just-in-Time (JIT) Inventory and Manufacturing
- An approach that maintains inventory at the lowest levels without sacrificing the availability of finished products. With this approach, inventory and materials are delivered just before they are used in a product. - However, JIT can result in some organizations running out of inventory when demand exceeds expectations or there are problems with the manufacturing process
Marketing Management Information System (MIS) Subsystem: Product Pricing
- Another important and complex marketing function. - Retail price, wholesale price, and price discounts must be set. - Companies often try to develop pricing policies that will maximize total sales revenues. - Computers are often used to analyze the relationship between prices and total revenues.
Information Subsystems and Outputs in Manufacturing: Inventory Control Question: How is the "when to order" question calculated/answered?
- Based on inventory usage over time - Answered in terms of a Re-Order Point (ROP), which equals a critical inventory quantity level
Marketing Management Information System (MIS) Subsystem: Sales Analysis
- Computerized sales analysis is important to identify pro- ducts, sales personnel, and customers that contribute to profits and those that do not. - Can be done for sales and ads that help generate sales. - Several reports can be generated to help marketing managers make good sales decisions
Non-programmed Decisions (Definition)
- Deal with unusual or exceptional situations. - Contains unique characteristics, and standard rules or procedures might not apply to them - These decisions are difficult to quantify -Examples: -- Determining the appropriate training program for a new employee -- Deciding whether to develop a new type of product line -- Weighing the benefits and drawbacks of installing an upgraded pollution control system
Capabilities of a Decision Support System (DSS): Support Various Decision-Making Levels
- Decision support systems can provide help for managers at various levels within an organization. - Operational managers can get assistance with daily and routine decision making. - Tactical decision makers can use analysis tools to ensure proper planning and control. - At the strategic level, DSSs can help managers by providing analysis for long-term decisions requiring both internal and external information.
Capabilities of a Decision Support System (DSS): Support Various Problem Structures
- Decisions can range from highly structured and programmed to unstructured and non-programmed. - Highly structured problems are straightforward, requiring known facts and relationships. - Semistructured or unstructured problems, on the other hand, are more complex.
Capabilities of a Decision Support System (DSS): Support Various Decision Frequencies
- Decisions can range on a continuum from one-of-a-kind to repetitive decisions. - One-of-a-kind decisions are typically handled by an ad hoc DSS. - Repetitive decisions are handled by an institutional DSS
Profit/Loss Center (Definition)
- Departments within an organization are profit centers, which means that they focus on generating profits. - Example: Investment division of an insurance or credit card company
What are some common information subsystems and outputs used in manufacturing?
- Design and Engineering - Master Production Scheduling - Inventory Control - Process Control - Quality Control and Testing
Human Resource Management Information System (HRMIS) Subsystems: Human Resource Planning
- Determining personnel and human needs. - The overall purpose of this MIS subsystem is to put the right number and type of employees in the right jobs when needed, including internal employees who work exclusively for the organization and outside workers who are hired when they are needed. - Determining the best use of existing employees is a key component of human resource planning
Management Information System (MIS) Reports: Demand Reports
- Developed to provide certain information upon request. - Produced on demand rather than on a schedule. - Often come from an organization's database system. - Can be generated to provide the requested information by querying the company's database
Cost Center (Definition)
- Divisions within a company that do not directly generate revenue - Example: Manufacturing or research and development departments
Revenue Centers (Definition)
- Divisions within the company that focus primarily on generating sales or revenues - Example: Marketing or sales departments
Human Resource Management Information System (HRMIS) Subsystems: Scheduling and Job Placement
- Employee schedules are developed for each employee, showing job assignments over the next week or month. - Job placements are often determined based on skills inventory reports showing which employee might be best suited to a particular job.
Human Resource Management Information System (HRMIS) Subsystems: Training and Skills Inventory
- HR managers are to train new employees - Some jobs require very specific training for new employees. Other jobs may require general training about the organizational culture, orientation, dress standards, and expectations. - When training is complete, employees often take computer-scored tests to evaluate their mastery of skills and new material.
Capabilities of a Decision Support System (DSS): Support Various Decision Frequencies Question: Institutional Support System (DSS) (Definition)
- Handles situations or decisions that occur more than once, usually several times per year or more. - Used repeatedly and refined over the years. Support for Various
Decision Making Phase: Intelligence Stage
- Identify and define potential problems or opportunities. - Investigate resource and environmental constraints.
Human Resource Management Information System (HRMIS) Subsystems: Personnel Selection and Recruiting
- If the human resource plan reveals that additional personnel are required, the next logical step is recruiting and selecting personnel. - Companies seeking new employees often use computers to schedule recruiting efforts and trips and to test potential employees' skills. - Many companies now use the Internet to screen for job applicants and for career postings. Thus, HR managers can then access these applications and identify applicants of interest.
What has the Programmed Decision-Making Process improved?
- Improved forecasting accuracy and reduced the possibility of manufacturing the wrong types of inventory - This has saved money and preserved cash reserves.
What can Decision Quality result in?
- Increased effectiveness - Increased efficiency - Higher productivity - Ect.
What functions do most Financial Management Information System (MIS) perform?
- Integrate financial and operational information from multiple sources, including the Internet, into a single system - Provide easy access to data for both financial and non-financial users, often through the use of a corporate intranet to access corporate Web pages of financial data and information - Make financial data immediately available to shorten analysis turnaround time - Enable analysis of financial data along multiple dimensions (time, geography, product, plant, and customer) - Analyze historical and current financial activity. Monitor and control the use of funds over time.
Auditing (Definition)
- Involves analyzing the financial condition of an organization and determining whether financial statements and reports produced by the financial MIS are accurate. - Internal auditing is performed by individuals within the organization
Human Resource Management Information System (HRMIS) Subsystems: Wage and Salary Administration
- Involves determining wages, salaries, and benefits, including medical payments, savings plans, and retirement accounts. - Wage data, such as industry averages for positions, can be taken from the corporate database and manipulated by the HRMIS to provide wage information and reports to higher levels of management.
Programmed Decisions (Definition)
- Made using a rule, procedure, or quantitative method. - Easy to computerize using traditional information systems.
Marketing Management Information System (MIS) Subsystem: Promotion and Advertising
- One of the most important functions of any marketing effort - Product success is a direct function of the types of advertising and sales promotion done. - Many small businesses are effectively advertising their products and services using Internet sites
Human Resource Management Information System (HRMIS) Subsystems: Outplacement
- Outplacement services are offered by many companies to help employees make the transition. - Outplacement can include: - Job counseling and training - Job and executive search - Retirement and financial planning - A variety of severance packages and options
Accounting Management Information System (MIS) (Definition)
- Performs a number of important activities - Provides aggregate information on accounts payable, accounts receivable, payroll, and many other applications.
Management Information System (MIS) Reports: Scheduled Reports
- Produced periodically, such as daily, weekly, or monthly - Scheduled reports can help managers control customer credit, performance of sales representatives, inventory levels, and more.
Management Information System (MIS) Reports: Drill-Down Reports
- Provide increasingly detailed data about a situation. - Using these reports, analysts can see data at a high level first (such as sales for the entire company), then at a more detailed level (such as the sales for one department of the company), and then a very detailed level (such as sales for one sales representative)
Characteristics of a Decision Support System (DSS)
- Provide rapid access to information - Handle large amounts of data from different sources - Provide report and presentation flexibility - Offer both textual and graphical orientation - Support drill-down analysis - Perform complex, sophisticated analyses and comparisons using advanced software packages - Support optimization, satisficing, and heuristic approaches - Perform simulation analysis - Forecast a future opportunity or problem
What functions do Management Information Systems (MISs) perform?
- 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 Management Information Systems (Definition)
- Provides financial information for executives and for a broader set of people who need to make better decisions on a daily basis - Help companies raise funds through loans and stock offerings
Management Information System (MIS) Reports: Exception Reports
- Reports that are automatically produced when a situation is unusual or requires management action. - Most often used to monitor aspects important to an organization's success. - When an exception report is produced, a manager or executive takes action.
Management Information System (MIS) Reports: Key-Indicator Reports
- Summarizes the previous day's critical activities and is typically available at the beginning of each workday. - Summarize inventory levels, production activity, sales volume, and the like. - Used by managers and executives to take quick, corrective action on significant aspects of the business.
What are the 4 main "Capabilities of a Decision Support System (DSS)"?
- Support problem-solving phases - Support various decision frequencies - Support various problem structures - Support various decision-making levels
Information Subsystems and Outputs in Manufacturing: Inventory Control
- Techniques are used to minimize inventory costs - Techniques determine when to restock and how much inventory to order
Capabilities of a Decision Support System (DSS): Support Problem-Solving Phases
- The objective of most decision support systems is to assist decision makers with the phases of problem solving. - Phases include intelligence, design, choice, implementation, and monitoring. - A specific DSS might support only one or a few phases.
What is the true potential of information systems?
- The potential is in helping you and your coworkers make more informed decisions - The result can be increased revenues, reduced costs, and the realization of corporate goals
Marketing Management Information System (MIS) Subsystem: Marketing Research
- To conduct a formal study of the market and customer preferences - Computer systems are used to help conduct and analyze the results of surveys, questionnaires, pilot studies, and interviews
What is Manufacturing Management Information System (MIS) Subsystems and Outputs used for?
- 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.
1. Where do many Management Information System (MIS) reports come from? 2. What is the output of most Management Information Systems (MISs)?
1. An organization's databases, data warehouses, and other sources 2. A collection of reports that are distributed to managers
1. Parameters, or trigger points, should be set ___ for an exception report. 2. What happens when trigger points are set too low? 3. What happens when trigger points are set too high?
1. Carefully 2. Low Trigger Points: Might result in too many exception reports 3. High Trigger Points: Could mean that problems requiring action are overlooked
1. Most organizations are structured along ___ . This functional structure is usually apparent from a(n) ___, which typically shows a ___ in roles or positions. 2. What are some traditional functional areas? 3. The Management Information System (MIS) can also be divided along those functional lines to produce:
1. Functional Areas; Organization Chart; Hierarchy 2. Include: - Finance - Manufacturing - Marketing - Human resources 3. Reports tailored to individual functions
1. What to subsystems for Marketing Management Information System (MIS) and their outputs help marketing managers and executives do? 2. What are the subsystems for Marketing Management Information System (MIS)?
1. Helps increase sales, reduce marketing expenses, and develop plans for future products and services to meet the changing needs of customers. 2. Include: - Marketing Research - Product Development - Promotion and Advertising - Product Pricing - Sales Analysis
1. Who developed the "Decision Making Phase" model? 2. Who later incorporated the model into an explained model of the entire problem-solving process?
1. Herbert Simon 2. George Huber
1. Internal uses of funds includes: 2. External uses of funds includes:
1. Internal Includes: - Purchasing additional inventory - Updating plants and equipment - Hiring new employees - Acquiring other companies - Buying new computer systems - Increasing marketing and advertising - Purchasing raw materials or land - Investing in new products - Increasing research and development. 2. External Includes: - Uses of funds are typically investment related.
Satisficing Model (Definition)
A model that finds a good—but not necessarily the best—solution to a problem.
Problem Solving Process (Definition)
A process that goes beyond decision making to include the implementation stage.
Problem Solving Process: Implementation Stage (Definition)
A stage of problem solving in which a solution is put into effect.
Why is satisficing a good alternative modeling method?
Because it is sometimes too expensive to analyze every alternative to find the best solution.
What does a Human Resource Management Information System (HRMIS) oversee and/or manage?
Being used to oversee and manage: - Part-time - Virtual work teams - Job sharing - Traditional job titles and duties.
How can Management Information Systems (MIS) reach programmed decisions?
By providing reports on problems that are routine and in which the relationships are well defined (structured problems)
How can Management Information System (MIS) give companies and other organizations a competitive advantage?
By providing the right information to the right people in the right format and at the right time
Information Subsystems and Outputs in Manufacturing: Inventory Control Question: What is one method of determining the amount of inventory to order? Give description and how to calculate.
Economic Order Quantity (EOQ). - Calculated to minimize the total inventory costs. - When the inventory level for a particular item falls to the reorder point, or critical level, the system generates a report so that an order is immediately placed for the EOQ of the product.
Optimization Model (Definition)
Finds the best solution, usually the one that will best help the organization meet its goals.
Decision Support Systems (Definition)
Help solve many nonprogrammed decisions in which the problem is not routine and rules and relationships are not well defined (unstructured or ill-structured problems).
In which stage of the "Decision Making Phase" can various factors influence the decision maker's selection of a solution?
In the choice stage
What are some examples of what external sources of data can include?
Include customers, suppliers, competitors, and stockholders, whose data is not already captured by the TPS and ERP systems, as well as other sources, such as the Internet.
Human Resource Management Information System (HRMIS) Subsystems: List
Include: - Human Resource Planning - Personnel Selection and Recruiting - Training and Skills Inventory - Scheduling and Job Placement - Wage and Salary Administration - Outplacement
Types of information and Decision Support Systems
Include: - Management information systems - Decision Support Systems (DIS) - Group Support System (GSS) - Executive Support System (ESS) - Knowledge Management Systems (KMS) - Special-Purpose Systems (SPS)
What do Management Information System Reports include?
Include: - Scheduled reports - Key-indicator reports - Demand reports - Exception reports - Drill-down reports
The Management Information System (MIS) must provide the right ___ , to the right ___ , in the right ___ , and at the right ___.
Information; Person; Format; Time
Marketing Management Information System (MIS) Subsystem: Product Development
Involves the conversion of raw materials into finished goods and services and focuses primarily on the various attributes of the product and its supply chain.
Information Subsystems and Outputs in Manufacturing: Process Control
Managers can use a number of technologies to control and streamline the manufacturing process.
Information Subsystems and Outputs in Manufacturing: Design and Engineering
Manufacturing companies often use computer-assisted design (CAD) with new or existing products
Information Subsystems and Outputs in Manufacturing: Quality Control and Testing
Manufacturing organizations are placing more emphasis on quality control, a process that ensures that the finished product meets the customers' needs.
What inventory technique is used when demand for one item depends on the demand for another item?
Material Requirements Planning (MRP)
In general, computerized decision support systems can either ___ or ___.
Optimize; Satisfice
Where does the data that enters a Management Information System (MIS) originate from?
Originates from both internal and external sources, including a company's supply chain The m. External sources of data can include customers, suppliers, competitors, and stockholders, whose
What does a Management Information System (MIS) provides managers with?
Provides information, typically in reports, that supports effective decision making and provides feedback on daily operations
Outputs of Human Resource Management Information Systems (HRMISs)
Reports: - Human resource planning reports - Job application review profiles - Skills inventory reports - Salary surveys
Decision Making Phase: Choice Stage
Requires selecting a course of action
What are some of the activities performed by Human Resource Management Information Systems (HRMISs)?
Some of the activities performed by HRMIS include: - Workforce analysis and planning - Hiring - Training - Job and task assignment - Many other personnel-related issues
What does a Marketing Management Information System (MIS) support?
Supports managerial activities in product development, distribution, pricing decisions, promotional effectiveness, and sales forecasting
These reports can be ___ for each user and can be delivered in a ___ fashion.
Tailored; Timely
Explain what an effective Human Resource Management Information System (HRMIS) allows/does?
Allows a company to keep personnel costs at a minimum while serving the required business processes needed to achieve corporate goals.
Optimization software also allows decision makers to explore various ___ .
Alternatives
Management Information System (MIS) (Definition)
An integrated collection of people, procedures, databases, and devices that provides managers and decision makers with information to help achieve organizational goals.
Optimization models use problem ___ .
Constraints
Although human resource information systems focus on ___ , many of today's HR systems concentrate on ___ and ___ existing employees to get the total potential of the human talent in the organization.
Cost reduction; Hiring; Managing
In what was can a business transaction be made with Management Information Systems (MISs)?
Can enter the organization through: - Traditional methods - Via the Internet - Via an extranet connecting customers and suppliers to the firm's ERP or transaction processing systems
Capabilities of a Decision Support System (DSS): Support Various Decision Frequencies Question: Ad Hoc Decision Support System (DSS) (Definition)
Concerned with situations or decisions that come up only a few times during the life of the organization - In small businesses, they might only happen once
The performance of these systems is typically a function of:
Decision Quality and Problem Complexity
What does Problem Complexity depend on?
Depends on how hard the problem is to solve and implement
Decision Making Phase: Design Stage
Develop alternative solutions to the problem and evaluate their feasibility
