Communication, Decision Making, and Different Types of Information Systems

1. 5 Communication, Decision Making, and Different Types of Information Systems

2. Table 5.1Customizing Jeans at Levi Strauss

3. Table 5.1Customizing Jeans at Levi Strauss CUSTOMER Person purchasing jeans

4. Table 5.1Customizing Jeans at Levi Strauss PRODUCT Customized pair of jeans Measurements representing the best fit Manufacturing specification for the customized pair of jeans

5. Table 5.1Customizing Jeans at Levi Strauss • BUSINESS PROCESS • Major Steps: • Take measurements • Try on special samples to get perfect fit • Transmit to factory in Tennessee • Manufacture jeans • Mail jeans to customer • Store specification for reorders • Rationale: • Sell customized jeans that really fit the customer.

6. Table 5.1Customizing Jeans at Levi Strauss PARTICIPANTS Customer Salesperson INFORMATION Customer’s measurements Manufacturing specifications Delivery address TECHNOLOGY Sample pairs for fitting the customer Technology for producing the jeans Computers and data communication network

7. Table 5.2Ways Information Systems Can Improve Communication and Decision Making Performane within Business Processes RATE OF OUTPUT Improve communication: Communicate more information or more types to more people Improve decision making: Make more decisions using better, more complete information CONSISTENCY Improve communication: Make sure different people receive the same communication Improve decision making: Make sure repetive decisions are made in the same way PRODUCTIVITY Improve communication: Achieve more communication with less effort Improve decision making: Make better decisions with less effort CYCLE TIME Improve communication: Eliminate undesirable delays in communication Improve decision making: Eliminate unnecessary delays in decision making FLEXIBILITY Improve communication: Permit communication in many different forms Improve decision making: Maintain decision quality across a wider range of situations SECURITY Improve communication: Make sure communications go only to the intended recipients Improve decision making: Make sure decisions are controlled only by those authorized to make the decisions

8. Table 5.3Communication Technologies Classified by Time and Place of Communication • SAME PLACE • Same time: • Presentation systems • Group decision support systems (GDSS) • Different time • Transaction databases • World Wide Web • Electronic mail • Voice mail • DIFFERENT PLACE • Same time: • Typical telephones • Computer conferencing • Video telephones and conferencing • Nonrecorded radio or TV broadcast • Different time • Transaction databases • World Wide Web • Electronic data interchange (EDI) • Electronic mail • Voice mail • Fax • Prerecorded radio or TV broadcast

9. Figure 5.1Steps in decision making

10. Table 5.4 How Information Systems Might Help Counteract Common Flaws in Decision Making POOR FRAMING Description: Allowing a decision to be influenced excessively by the language used for describing the decision How an information system might help: Provide information encouraging different ways to think about the definition of the issue RECENCY EFFECTS Description: Giving undue weight to the most recent information How an information system might help: Provide information showing how the most recent information might not be representative PRIMACY EFFECTS Description: Giving undue weight to the first information received How an information system might help: Show how some information is inconsistent with the first information received POOR PROBABILITY ESTIMATION Description: Overestimating the probability of familiar or dramatic events; underestimating the probability of negative events How an information system might help: Make it easier to estimate probabilities based on pertinent data

11. Table 5.4 How Information Systems Might Help Counteract Common Flaws in Decision Making OVERCONFIDENCE Description: Believing too strongly in one’s own knowledge How an information system might help: Provide counterexamples or models showing that other conclusions might also make sense ESCALATION PHENOMENA Description: Unwillingness to abandon courses of action decided upon previously How an information system might help: Provide information or models showing how the current approach might give poor results ASSOCIATION BIAS Description: Reusing strategies that were successful in the past, regardless of whether they fit the current situation How an information system might help: Provide information showing how the current situation differs from past situatioins GROUPTHINK Description: Bowing to group consensus and cohesiveness instead of bringing out unpopular bias How an information system might help: Provide information inconsistent with the current consensus and prove its relevance

12. Figure 5.3Structuring loan authorization

13. Table 5.5Typical Ways Each Type of Information System Supports Communication and Desicion Making OFFICE AUTOMATION SYSTEM: provides individuals effective ways to process personal and organizational business data, to perform calculations, and to create documents COMMUNICATION SYSTEM: helps people work together by sharing information in many different forms TRANSACTION PROCESSING SYSTEM (TPS): collects and stores information about transactions; controls some aspects of transactions MANAGEMENT INFORMATION SYSTEM (MIS) AND EXECUTIVE INFORMATION SYSTEM (EIS): converts TPS data into information for monitoring performance and managing an organization; provides executives information in a readily accessible interactive format DECISION SUPPORT SYSTEM (DDS): helps people make decisions by providing information, models, or analysis tools EXECUTION SYSTEM: directly supports the organization’s value added work (e.g.. helps sales people sell, helps doctors practice medicine, or helps architects design buildings)

14. Table 5.6Examples of Each Type of Information System in Three Functional Areas of BusinessSales, Manufacturing, and Finance • OFFICE AUTOMATION SYSTEMS • COMMUNICATION SYSTEMS • TRANSACTION PROCESSING SYSTEM (TPS) • MANAGEMENT INFORMATION SYSTEM (MIS) AND • EXECUTIVE INFORMATION SYSTEM (EIS) • DECISION SUPPORT SYSTEM (DDS) • EXECUTION SYSTEM

15. Figure 5.4Options for teleconferencing

16. Figure 5.5Data entry screen from a transaction processing system

17. Figure 5.6A management report from an MIS

18. Figure 5.7Use an executive information system (a)

19. Figure 5.7Use an executive information system (b)

20. Figure 5.7Use an executive information system (c)

21. Figur 5.8Graphical output from a decision support system

22. Figure 5.9A GDSS

23. Table 5.7Transferable Features of Particular Types of Information Systems • OFFICE AUTOMATION SYSTEMS • Transferable features: • Multiple forms of information, sometimes used in combination • Immediacy and interactivity of communication • Avoidance of unproductive work • COMMUNICATION SYSTEMS • Transferable features: • Emphasis on communication in addition to data processing • Consideration of social presence and other communication characteristics when building systems • Recognition of the need to handle different combinations of same or different time or place • Sharing information betwween different people working on different parts of a task • Controlling work flows and approval loops within a group • Incorporating efficient methods of scheduling meetings • TRANSACTION PROCESSING SYSTEMS • Transferable features: • Control • Procedures and rules • Repetitions

24. Table 5.7Transferable Features of Particular Types of Information Systems • MANAGEMENT AND EXECUTICE INFORMATION SYSTEMS • Transferable features: • Emphasis on measures of performance • Use of standard formats and measures by people in different departments • User friendly interface • User friendly methods for analyzing data • DECISION SUPPORT SYSTEMS • Transferable features: • User-controlled interaction with computers • Use of models and data • Information systems applied to semistructured tasks • EXECUTION SYSTEM • Transferable features: • Integrating computerized systems into doing the organization’s value added work • Bringing knowledge in active form to people doing the work