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Management Information Systems
  Term Paper ID:31844
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Examines various subsystems within organizations the interrelationships of those subsystems and how information technology ...... More...
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Paper Abstract:
Examines various subsystems within organizations, the interrelationships of those subsystems, and how information technology enhances those relationships through management information systems. Gives examples from various subsystems (e.g. corporate culture, power dynamics).

Paper Introduction:
Management Information Systems Introduction When analysts speak of companies or organizations they are actuallyreferring to open systems composed of subsystems each of which mustfunction efficiently and effectively if the organization is to survive Often these subsystems are viewed independent from the larger whole butin fact they are interrelated and interdependent This interrelationshiphas become increasingly clear as information technology has emerged that isable to bring together various pieces of data generated in different anddisparate subsystems but used by entirely different subsystems Managingthe information

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(1995, March). Originally, executive information systems presented data about acompany's performance up to a particular point in time. Users are able to use such systems more quickly than thecommand systems currently in use, and the results of natural languageprocessing are promising. Thus there is the human resource subsystem,composed of the individuals and resources that focus on the successfulrecruiting, management and training of employees. Thus these systems now include sophisticatedforecasting models and "what-if" scenario builders to help executives trackwhat has been, but also plan what will be (Zimmerman, 1997). Canada: Course Technology.Cassie, C. Information distillation. At the heart of most DSS is the data warehouse. C. Some companies assume that the improvedemployee communication is part of the increased productivity that theyexpect, but companies who take such a simplistic view overlook the veryreal effect that increased and easier communication can have on morale.Companies which have a significant amount of information available, whetherthrough an intranet or through some other means, tend to have higheremployee morale and lower employee turnover as a result, as well (Sharples,1998). Traditionally, DSS provides strong data transformation capabilitiesand strong analysis, but on a limited basis (Shafiei & Sundaram, 2 4).For example, decision support systems might be implemented in individualfunctional areas of an organization, such as the manufacturing group, butisolated from other parts of the organization. Eventually, the company intends to haveall of its more than 1 , employees who use personal computers able toaccess the intranet. Management Review, p. Managing Information Technology. This simple use of a decision support system identifies the keyfeatures of all decision support systems. The resulting information is then prepared and disseminated inways that are readily accessible to the decision maker. Recognizing that strategic decision makers need tools which gowell beyond merely reporting what has already happened, executiveinformation systems now assist decision makers in determine what mighthappen in the future. Nearly allintranets are similar in appearance to the Internet, and provide variousways for users to navigate the site. Thus management information systemsand information technology greatly enhances the decision making potentialof leaders within these organizations and the management expertiseexercised within the organization. Thus, a decision supportsystem might take into account the various factors that influenceproduction capacity and analyze the most efficient quantities forproduction. SRS is a group of independent"boutique" hotels and the company "brands" its products through coordinatedmarketing activities. Fully one-fifth of these companies also offer 4 1(k) retirementinformation or plan to do so in the future, another benefit of the intranetwhich reduces the workload on human resource professionals (Troiano, 1999). The various subsystems in an organization are best described by thefunctions that they perform. Natural language processing is directly related to artificialintelligence (although it can be used with traditional computer techniques,as well). Decision Support Systems Decision support systems provide tools used by decision makers toanalyze data (Cassie, 1997). W., Brown, C. The Data Administration Newsletter. Marketing relies on finance toprovide the cash flow for its activities; manufacturing relies on the salesdepartment to sell products and provide sales forecasts. Other factors, including corporateculture and power dynamics, are also influenced by the externalenvironment. (2 2, July 1). (1997, July-August). The most general benefit thatcompanies expect is an increase in productivity, ostensibly becauseemployees will have access to information which formerly they would nothave had, or which they would have needed the assistance of anotheremployee in order to access. Manufacturing provides yet another subsystem,as does program management, a function found in larger organizations.Individual companies may have more or less subsystems depending on theirorganizations, and individual subsystems may themselves have subsystems.Thus accounting might have subsystems of accounts payable, accountsreceivable and finance while marketing might have subsystems of productmanagement, advertising and promotions. Cincinnati, OH: South Western College Publishing.Hall, M. Training & Development, pp. Neuralnetworks try to reproduce the biological network electronically toapproximate the abilities of the brain and nervous system to recognizepatterns, satisfy constraints and process signals. Executives do not have tosort through the raw data which might exist on the larger computer systemwithin the organization, but are instead able to use information which isalready presented in an easy-to-understand format. An example of asimple decision support system is someone using the Weather Channel to makea decision about whether to carry an umbrella on a given day. This interrelationship among functionaldepartments is not a new phenomenon; it is only with the advent oftechnologies such as those examined here that data sharing has beenpossible on an enterprise-wide level. 17-18. F., & Wagner, B. Intranet booms for midsize companies. Examples of this type of productivityincrease are posting employee benefits on the intranet, including policiesand procedures, and posting access to pricing information for products andservices. A., and Perkins, W. (2 2). W., Hoffer, J. Computerworld, p. There are significant drawbacks to expert systems, including theavailability of an expert, which make them unsuitable for someapplications. Retrieved from the Internet 3 Sep 2 4: http://www.tdan.com/i 2 hy 3.htm.Thomas, V., & Kleiner, B. At AT&T, sales representatives are the primary users of the businessservice group's intranet, with several thousand sales representativescurrently using the system; thousands more are expected to migrate to thesystem prior to the end of 2 1. The decision maker than uses the probability of rainidentified by the Weather Channel to decide whether an umbrella isappropriate. (2 , June 5). Facility layout with fuzzy logic. 1, 7.Shafiei, F., & Sundaram, D. Case based reasoning. Forprofit-making organizations, such interactions can be found in thecompany's relationships with vendors and customers as well as with otherstakeholders (such as owners and even employees, who can change theiremployers). Supermarket News, pp. At that point, thesystems provided little more than the executive could obtain from theinformation system itself. (2 2). Having a system which enables companies toprepare the most efficient bid ensures that potential profits are not lostdue to poor information, but also that the bids are competitive relative tothe rest of the market (Hamblen, 2 ). (2 4). For both of these companies, oneof the most significant results of implementing an intranet has been anincrease in the company's profitability. There is an interconnectednessamong the subsystems critical to the functionality of the company as awhole, and a need for accurate and timely information across the varioussubsystems necessary for effective decision making (Adobor, 2 2). This illustrates one of the drawbacks to DSS andhighlights the need for systems that can pull information from across theorganization (Brady, Monk & Wagner, 2 1). B. Typically, these are sophisticated toolsusing broad-based technology that provides comprehensive data analysis andpresentation. Advances in Competitiveness Research, 1 , pp. Companies which implement intranets fully expectthat employee communication will improve both from a top-down perspectiveas well as peer-to-peer. Industrial Management & Data Systems, 97, pp. This interrelationshiphas become increasingly clear as information technology has emerged that isable to bring together various pieces of data generated in different anddisparate subsystems but used by entirely different subsystems. 24-29.Daft, R. This is a time-consuming process that can have manyiterations before a successful group of rules is arrived at, and thetypical development time for an expert system is 12 to 18 months. In fact, all expert systems require that users be able to retrieveinformation quickly and effectively in order to be useful. Managingthe information technology in this environment is a challenging and evendaunting task, but bringing together key pieces of data and transformingthem into valuable information can be a critical success factor for manycompanies. Upper Saddle River, NJ: Prentice Hall.Rendleman, J. According to a survey of small and medium-sized companies, 26percent currently provide access to employee benefits election informationon their intranets. (1998, November). (1996, November). Neuralnetworks offer a solution to this problem and are being implemented in anumber of different applications and environments (Thomas & Kleiner, 1995). The Automobile Club of Southern California has used its intranet toenhance its internal training program. 22-26.Troiano, P. 1 2-1 3.Smith, A. Expert systems require the assistance of an expert in orderto be implemented. Organization theory and design. This research considers the various subsystems at a typicalcompany and how three different applications of information technology linkthose subsystems together through management information systems. Journal of Systems Management, 46, pp. Neural networks attempt to mimic the processing of the human brain,although on a much smaller scale. Marketing Intelligence & Planning, pp. While intranets can also be used for bottom-upcommunication, companies typically do not expect (nor do they realize)significant benefit in this area. Thus Duke Energy is able touse its intranet to provide critical data to decision makers across itssubsystems which allows the organization to realize maximum profit in ahighly competitive environment. As intranets have become more sophisticated andmoved past being merely company bulletin boards, companies have found waysto use them to provide competitive advantage. (1999, August). Human resourcesboth serves all other subsystems in the organization and receivesinformation from these subsystems, as well. Theworking memory holds the results of the last "thought" and the input whichtriggers the next action. The intranet at SRS World Hotels was originally developed to provideinformation simultaneously to more than 8 sales representatives located in3 different countries. 44-48.Brady, J. Appliance Manufacturer, pp. Some intranets are organized bysubsystem (purchasing, human resources or finance, for example) andmaintained by the individual departments. Expertsystems are rule-based computer programs that enable users to takeadvantage of a vast array of information in order to make decisions. There is also a knowledge acquisition subsystemused to keep the knowledge base up to date, and an explanation system whichcan be used to explain the expert system's "reasoning." Expert systemsalso have a user interface of some type to provide information to the user. Inother words, the organization-as-system takes inputs from the environment,modifies them, and returns the resulting output to the environment (Daft,1998). Decision-support systems. Knowledge-based modeling for strategic decisions. At the same time, companies such as theAutomobile Club of Southern California have improved both the "product"associated with internal training (through having updated courses alwaysavailable on the intranet) while reducing the cost associated withproducing and distributing those courses. Industrial Management & Data Systems, pp. Typically, they are used to improvecommunications and provide access to information among employees, andoccasionally, vendors and clients (Martin, et al, 2 2). In business, DSS evolved from the ability of computers to analyzelarge amounts of data quickly and present the data in an organized fashion,such as in spreadsheets. Accounting is anothersubsystem, as is marketing. Thesystem compares the current situation to a list of rules and determines theappropriate solution. Small and medium-sized companies tend to use intranets to providegeneral information to employees, such as providing the employee handbookon-line and commonly used HR forms. Improved communication among business subsystems is another expectedbenefit of intranets. Expert Systems/Artificial Intelligence Artificial intelligence came to be largely synonymous with "expertsystems" during the 198 s (Yoon, Guimaraes, & O'Neal, 1995). For example, a human resourcessubsystem query might request all individuals who make more than theaverage salary for male employees. H. In addition to having access to an expert, theindividual (or individuals, since more than one expert is often used) mustbe able to explain how they arrive at a particular decision. Increasingly, however, intranetshave a central point where intranet information is developed anddistributed; this usually occurs in larger organizations and the task isoften handled by the MIS or IT group in conjunction with managing thecompany's Web site (Martin, et al, 2 2). This can make it easierfor executives to compare data over time, across product lines, and withindifferent areas of the organization quickly, and can assist in the decisionmaking process much more readily than traditional management systems(Kelleher, 1999). 4 .Kelleher, J. (1997, 25 August). Business Subsystems Fundamental to the understanding of organizations is the concept ofthe organization as system. MIS Quarterly, pp. The intranet made it possible to post theinformation a single time and know that employees could access theinformation from anywhere in the world. Through the use of these executive informationsystems, managers are able to integrate decision support systems, data fromother groups in the company, and (for example) human resource informationin order to better manage their activities and employees. Duke Energy North America, located in Charlotte, North Carolina, setup an intranet which serves as the company's real-time performance costmonitoring system. (2 1). With the advent of thecompany's intranet, the courses are simply uploaded to the intranet andemployees can access the courses on an as-needed basis without beingconcerned that they are running an outmoded version of the course(Abernathy, 1998). 14-2 .Martin, E. Executive Information Systems Executive information systems provide a management team and individualmanagers the ability to retrieve information critical for making timely andeffective decisions. 78-79.Adobor, H. (1996, April). The objective of these systems was to make itpossible for decision makers to make better decisions by using informationthat had been refined from available data. Data about sales to date (marketing,manufacturing and finance subsystems), profitability (finance subsystem),collections (accounts receivable subsystem) and other traditional businessinformation was made available, and could even be presented in chart form. Developers of neural networks learned thatbiological neurons, similar to computer bits, are either on or off. Conclusion Companies are composed of functional subsystems whose information canbe shared and used to create competitive advantage and long-term success.Executive information systems, decision support systems, expert systems andintranets are three examples of ways in which information technology hasbrought these subsystems together in today's organizations, increasing theinterrelationships among subsystems that once operated without the benefitof company-wide data analysis. It was now possible, throughthe use of DSS, for decision makers to take far more factors into accountthan they had been able to do in the past. 83- 1 6.Zimmerman, D. However, decision support systems have their roots in thepractice of someone taking data, applying analysis to create information,and using the resulting information to make a decision. New developments in computer software. Graphic Arts Monthly, pp. Retrieved from the Internet 3 Sep 2 4: http://csdl.computer.org/comp/proceedings/hicss/ 2 4/2 56/ 8/2 568 228aabs.htm.Sharples, H. Executive information systems aretailored the specific needs of individual managers in individual subsystemswhich enhances their productivity and gives them the tools they need tocomplete their tasks. The Complete picture. The company formerly distributedits computer-based training (CBT) on CD-ROMs, which were updated on aregular basis. (1995, June). For example, culture is affected by the various employees andthe backgrounds that they bring to the organization, as well as by thelarger culture in which the company operates (Daft, 1998). Management Information Systems Introduction When analysts speak of companies or organizations, they are actuallyreferring to open systems composed of subsystems, each of which mustfunction efficiently and effectively if the organization is to survive.Often, these subsystems are viewed independent from the larger whole, butin fact, they are interrelated and interdependent. Executiveinformation systems can be expensive because of the high level ofcustomization. (1998). Intranets Intranets are private networks designed to help employees shareinformation within the company. Duke estimatesthat the $2 , system has already paid for itself, but recognizes thatit is impossible to quantify exactly how much of an advantage the systemhas provided to a company which did more than $17 billion in sales prior tointroducing the intranet (Hamblen, 2 ). Marketing decision support systems. Since thesesystems are customized for each individual manager, they can help managerswith specific issues within their group (Martin, et al, 2 2). A., Monk, E. Data is gathered by the systemand analysis performed on that data. As technology progressed, however, so did executive informationsystems. The system helps the company develop and submit bids onpower to the wholesale energy market, a market where prices can vary from$3 per megawatt hour in the Midwest in May to $6, per megawatt hour inthe northeast on the same day. In this context, a system is composed ofinterrelated and interacting components that modify their environment. Duke's system shows bidders, plant managers and corporate assetmanagers a "snapshot" of the production capability of all plants throughoutthe day. When a company implements an intranet, there are several benefits thatit expects to realize in the short-term. By using the intranet,employees are able to gain access to information kept on legacy systemswhich would otherwise be difficult or impossible to retrieve (Rendleman,2 ). As computer technology progressed, it was commonfor functional areas of organizations to implement systems that met theirunique needs although these computer systems were often isolated from otherareas of the organization. 293-296.Curry, B. (1998, November). Intranet enables more competitive energy bids for wholesalers. However, none of the subsystems,or sub-subsystems, operates independently. ReferencesAbernathy, D. In addition, 24 percent use the intranet as a way tocollect and distribute personal data to and from employees, a feature whichcan be particularly useful when employees are located at different worksites. The decisionmaker has the ability to look out the window--gathering data--but theWeather Channel uses additional analytical tools to take the same data anddetermine the likelihood of rain occurring, thus transforming the data intoinformation. However, if the company is unable to sell the units that areproduced, the company is actually worse off than if production had remainedat previous levels. The intranet at AT&T provides access to ordering,billing, credit evaluation and pricing tools. One of the key features of an executive information system is thatinformation is presented in formats (charts, graphs, tables) which are easyfor the executive to assimilate and use quickly. Expert systems have been used in legal practices,physicians' offices, education, insurance and a variety of other fields,and can incorporate information from throughout the various subsystems ofan organization. 1-1 . Competitive success in an age of alliance capitalism. In the beginning, the company focused on havinginformation available to the sales people, but SRS later expanded theintranet to include having member hotels accessing information aboutproperties and clients who might be interested in staying at other SRSproperties (Adams, 2 ). Intranets. Expert systems have a knowledge base similar to the memory of thehuman information processor and an inference mechanism which uses theknowledge base in a way similar to the human cognitive processor. It is notenough for an expert to tell the interviewer what the answer to a problemis; the expert must be able to describe the reasoning behind the solution.In this way, rules can be developed and coded into the expert system forlater extraction. PC Week, pp. The goal of natural language processingis to have computers understand and respond to commands and inquiriesissued in noncryptic, colloquial language, either typed or spoken. J. This eliminates the need for consultingan expert, and development time is greatly reduced (to weeks or months)(Thomas & Kleiner, 1995). Data warehousing and ERP. DSS came to exemplify the modelof "ask a question, get an answer" from computers, and led to thetransformation of computers in business from "data processing" to"management information systems," and then to "information technology"departments (Hall, 2 2). 8.Yoon, Y., Guimaraes, T., & O'Neal, Q. Neural networks do not rely on a set of rulesthat are based on individual interpretation, but use binary processing toarrive at decisions. 31.Hamblen, M. This provides storagefor detailed data that can be either lightly or heavily summarized, and thedata warehouse is excellent at storing and transforming historical data.Typically, data in a data warehouse is structured for query and analysispurposes (Smith, 2 2). To assist inthis retrieval, developers have turned to natural language processing.This type of processing uses everyday speech patterns, words and grammarfor commands. (2 2, April 15). Treasury & Risk Management, pp. The basic difference between expert systems and neural networks isthat expert systems use analytical abstraction, while neural networks relyon binary processing. Computerworld, 36, p. V., DeHayes, D. Exploring the factors associated with expert systems success. L. Company's intranet yields new benefits. (1995, August). For example, an organization thatoperates in a highly dynamic market may succeed with a horizontal structurewhile an organization operating in a highly structured environment mayfavor a more hierarchical structure. Mega AT&T intranet tames mainframe apps. In the case of the Weather Channel and theumbrella, even if the probability of rain is 1 percent, the decisionmaker chooses to participate in activities that do not require him toventure outside at all. When combined with traditional computer technology, natural languageprocessing results in powerful systems. Concepts in Enterprise Resource Planning. Some companies expect more than just improved productivity andenhanced employee morale. The biological brainconsists of 1 billion neurons, each connected to 1 , others bysynapses; neural networks are subject to size constraints and can thus beconstructed for limited applications (Curry, 1996). Management information systems in a workgroup environment providesimilar information to all users. The manufacturing decision makers might well act on thisinformation. Multi-Enterprise collaborative enterprise resource planning and decision support systems. 71-99.Arif, A., & Badiru, A. Open systems must have external interaction in order to survive. The end result is that the user is able to access datawhich the system does not necessarily have discreetly available (Arif &Badiru, 1996). However, companies of this size arealso using intranets to provide benefits information as well as informationabout the company's finances and sales (as deemed appropriate bymanagement). Typically, the system is able tointegrate more relevant data than the decision maker could on his own, andperform more sophisticated analysis than the decision maker couldaccomplish. This required that the company recall the old discs, pressnew ones, and distribute them across remote sites. Instead, the system calculates theaverage for male employees, and then compares that figure to the salariesfor other workers. M. Initially, the success of executive informationsystems was dependent on the willingness of the executives to use thecomputer at all; today, the success depends on the accessibility of companyand industry data, with the data contributed by, and accessed by, thevarious subsystems of the organization. Despite the cost which can be associated with thesesystems, the benefits they produce can be substantial and often justify theinvestment. The natural language processor is ableto calculate the correct list even if the average salary for male employeesis not a discreet value on the system. Proceedings of the 37th Hawaii International Conference on System Sciences, 2 4, pp. (2 , March 13). (1999, February). Note, however,that the decision support system does not make the decision for thedecision maker, but provides the information with which the decision makercan make an informed decision. Internal structure and efficiency are critical success factorsfor these organizations, but are dependent on external factors to determinehow successful the organization will be. It separates out the production needed for existing clients,allowing bidders and others to see what capacity is left for selling on theopen market. Concepts of an intelligent machine are inherently linked to itsuse and the manipulation of the primary representation of knowledge: words(Yoon, Guimaraes, & O'Neal, 1995). 43-44.Kesh, S. With this data, bidders can set a price for wholesale energycontrolled by energy aggregators, shipping power to an area where demand ishigh from an area where production capacity is available. J.

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