Chapter 8: Management
Information and Decision Support
Systems
Principles
Good decision-making and problem-solving skills are the key to developing effective
information and decision support systems
A management information system (MIS) must provide the right information to the right
person in the right format at the right time
Decision support systems (DSS) support decision-making effectiveness when faced with
unstructured or semi-structured business problems
Specialized support systems, such as group support systems (GSS) and executive support
systems (ESS), use the overall approach of a DSS in situations such as group and executive
decision making.
Decision Making and Problem Solving
Every organization needs effective decision making
In most cases, strategic planning and overall goals of the organization set the course for decision
making
Information systems can assist with strategic planning and problem solving
Decision-making phase: first part of problem-solving process
Intelligence stage: potential problems or opportunities are
identified and defined
Design stage: alternative solutions to the problem are
developed
Choice stage: selecting a course of action
Problem solving goes beyond decision making to include
implementation and monitoring stages
Implementation stage: a solution is put into effect
Monitoring stage: decision makers evaluate the implemented solution
Programmed vs. Non-programmed decisions
o Programmed decision
Decision made using a rule, procedure, or quantitative method
Structured, routine, well-defined decisions
Easy to computerize using traditional information systems Decisions
o Non-programmed decision
Decision that deals with unusual or exceptional situations
Not easily quantifiable
Unstructured
Standard rules, procedures not available/applicable
, Optimization, Satisficing and Heuristic Approaches (Decision Support Models)
o Optimization model: find the best solution, usually the one that will best help the
organization meet its goals
o Satisficing model: find a good, not necessarily the best, problem solution
o Heuristics: commonly accepted guidelines or procedures that usually find a good
solution
Sense and Respond
Big Data
An Overview of Management Information Systems
Management information system (MIS) Integrated collection of people, procedures, databases,
and devices. Provides managers and decision makers with information to help achieve
organizational goals. Can give the organization a competitive advantage Providing the right
information to the right people in the right format and at the right time. Provides managers with
information that supports effective decision making and provides feedback on daily operations.
Inputs to a Management Information System:
o MIS Inputs Internal data sources
TPSs and ERP systems and related databases
Data warehouses and data marts
Specific functional areas throughout the firm
o External data sources
Customers, suppliers, competitors, and stockholders whose data is not already
captured by the TPS
Internet
Extranets
Outputs of a management Information System:
o Scheduled Reports
Scheduled reports: are produced periodically, or on a schedule, such as daily,
weekly, or monthly.
- For example: a production manager could use a weekly summary report
that lists total payroll costs to monitor and control labour and job costs.
A manufacturing report generated once per day to monitor the production of a
new item is another example of a scheduled report.
Other scheduled reports can help managers control customer credit,
performance of sales representatives, inventory level and more.
o Key-Indicator Reports
Key indicator report: a summary of the previous day’s critical activities;
typically, available at the beginning of each workday.
These reports can summarize inventory levels, production activity, sales volume,
and the like.
Key indicator reports are used by mangers and executives to take quick,
corrective action on significant aspects of the business.
o Demand Reports
