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Weeks 4-5: Internal Information Systems - PowerPoint PPT Presentation

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Weeks 4-5: Internal Information Systems. MIS 2101: Management Information Systems. Based on material from Information Systems Today: Managing in the Digital World , Leonard Jessup and Joseph Valacich, Pearson Prentice Hall, 2007

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Weeks 4-5: Internal Information Systems

MIS 2101: Management Information Systems

Based on material from Information Systems Today: Managing in the Digital World, Leonard Jessup and Joseph Valacich, Pearson Prentice Hall, 2007

Also includes material by David Schuff, Paul Weinberg, and Cindy Joy Marselis.

Operational Level

Day-to-day business processes

Interactions with customers

Information systems used to:

Automate repetitive tasks

Improve efficiency




Can often be automated using IS


Managerial Level

Functional managers

Monitoring and controlling operational-level activities

Providing information to executive level

Midlevel managers

Focus on effectively utilizing and deploying resources

Goal of achieving strategic objectives

Managers’ decisions


Contained within business function

Moderately complex

Time horizon of few days to few months


Executive Level

The president, CEO, vice presidents, board of directors


Long-term strategic issues

Complex and nonroutine problems

Unstructured decisions

Long-term ramifications



General Types of Information Systems

Input-process-output model

Basic systems model

Payroll system example

Transaction Processing System

Operational level


Processing of business events and transactions

Increase efficiency


Lower costs

Increased speed and accuracy


Payroll processing

Sales and order processing

Inventory management


Architecture of a TPS: Inputs

Source Documents

Different data entry methods

Architecture of a TPS: Processing

Online processing

Immediate results

Batch processing

Transactions collected and later processed together

Used when immediate notification not necessary

Architecture of a TPS: Outputs

Counts, summary reports

Inputs to other systems

Feedback to systems operator

Summary of TPS Characteristics

Management Information Systems

Managerial level


Produce reports

Support of midlevel managers’ decisions


Sales forecasting

Financial management and forecasting

Manufacturing, planning and scheduling

Inventory management and planning


Executive Information Systems

A.k.a. Executive support system

Executive level


Aid in executive decision-making

Provide information in highly aggregated form


Monitoring of internal and external events and resources

Crisis management


Architecture of an EIS: Inputs

Hard data

Facts and numbers

Generated by TPS & MIS

Purchased data

Soft data

Nonanalytical information

Web-based news portals


Delivery to different media

Architecture of an EIS: Processing


Graphical interpreting

Architecture of an EIS: Outputs

Summary reports



EIS Output: Digital Dashboards

Digital dashboard

Presentation of summary information

Information from multiple sources

Ability to drill down if necessary


So what’s the trend as you go down the list/up the pyramid?

  • Executive Information Systems

    • Highest level summary of information

  • Management Information Systems

    • Aggregate and collect data

  • Transaction Processing Systems

    • Collect data

Summary: Types of Information Systems





Controls and Security


Operations Staff



Source: Business Driven Technology, by Haag, Baltzan, Phillips, McGraw Hill, 2006 (with modifications)

Summary: Decision Levels

Decision Level



Type of Information


Competitive advantage

Market leader

Long term

New products

that change

the industry

External events,

rivals, sales, costs

quality, trends.


Improve operations

without restructuring

New tools to

cut costs or imp-

rove efficiency


schedules, sales

models, forecast


Day-to-day actions

keep company running



placing orders.



HRM, inventory

Learning Objectives

Information Systems Today: Managing in the Digital World


1. Decision Support Systems Boundaries

Decision making support for recurring problems

Used mostly by managerial level employees (can be used at any level)

Interactive decision aid

What-if analyses

Analyze results for hypothetical changes

Common DSS Models Boundaries

Information Systems Today: Managing in the Digital World


Using DSS to Buy a Car Boundaries

Selling price – $22,500

Down payment – $2,500

Monthly payment – about $400

Interest rate information from the bank

2. Intelligent Systems Boundaries

Artificial intelligence

Simulation of human intelligence

Reasoning, learning, sensing, hearing, walking, talking, etc.

Intelligent Systems Boundaries

Three types

Expert systems

Neural networks

Intelligent agents

Expert Systems Boundaries

Use reasoning methods

Manipulate knowledge rather than information

System asks series of questions

Inferencing/pattern matching

Matching user responses with predefined rules

If-then format

Neural Network System Boundaries

Approximation of human brain functioning

Training to establish common patterns

Past information

New data compared to patterns

E.g., loan processing

Example: Neural Network System Boundaries

Loan processing system relying on a neural network


Intelligent Agent Systems Boundaries

Program working in the background

Bot (software robot)

Provides service when a specific event occurs

Intelligent Agent Types Boundaries

Buyer agents (shopping bots) – search for best price

User agents – perform a task for the user

Monitoring and sensing agents – keep track of key information

Data-mining agents – analyze large amounts of data

Web crawlers (web spiders) – browse the Web for specific information

Destructive agents – malicious agents designed by spammers

3. Data Mining and Visualization Systems Boundaries

Application of sophisticated statistical techniques

What-if analyses to support decision making

Capabilities can be embedded into a large range of systems

Visualization Boundaries

Display of complex data relationships using graphical methods

Visualization of a weather system

Text Mining Boundaries

Extraction of information from textual documents

Web crawlers used to extract information from Internet

4. Office Automation Systems Boundaries

Developing documents, scheduling resources, communicating


Word processing

Desktop publishing

Electronic calendars


5. Collaboration Technologies Boundaries

Increased need for flexible teams

Virtual teams – dynamic task forces

Forming and disbanding as needed

Fluctuating team size

Easy, flexible access to other team members

Need for new collaboration technologies

Video Conferencing Boundaries

Costs – few thousand dollars to $500,000

Dedicated videoconferencing systems

Located within organizational conference rooms

Highly realistic

Groupware Boundaries

Enables more effective team work

Distinguished along two dimensions

6. Knowledge Management Systems Boundaries

Generating value from knowledge assets

Collection of technology-based systems

Knowledge assets

Skills, routines, practices, principles, formulas, methods, heuristics and intuition

Used to improve efficiency, effectiveness and profitability

Documents storing both facts and procedures


Databases, manuals, diagrams, books, etc.

7. Functional Area Information Systems Boundaries

Cross-organizational-level IS

Support specific functional area

Focus on specific set of activities

Cases Systems Systems

Personalized greeting

Memory for recent purchases

Targeted “gold box” offers and bargains

Fraud protection

Shipping vs. billing address comparison

Method of shipment checks

Credit card sources checks

“One-click” shopping

  • 35 million customers worldwide

  • Innovations leading to satisfaction

The Growing Blogosphere Systems

One of the fastest growing phenomena in the digital world

Too Much Technology? SystemsRFID and Privacy

RFID tags

Latest in technological tracking devices

Information imprinted on a tag

Tag generates signature signal

Special RFID reader interprets signal

Use of RFID tags

Pharmaceutical industry

Tracking of medication from factory to pharmacy

Retail businesses