DEVELOPMENTS OF
MANAGEMENT INFORMATION SYSTEMS
Information is a corporate resource,
as important as the capital, labour, know-how etc. and is being used for
decision-making. Its quality, therefore, is required to be very high. Low
quality information would adversely affect the organizational performance as it
affects decision-making. The quality of information is the result of the
quality of the input data, processing design, system design, system and
procedures which generate such a data, and the management of the data
processing function. Quality, unlike any other product, is not an absolute concept.
Its level is determined with reference to the context and its use, and the
user. Perfect quality just as perfect information is non-achievable and has
cost-benefit implications.
However, it is possible to measure
the quality of information on certain parameters. All these parameters need not
have a very high value. Some parameters may have lesser importance in the total
value on account of their relevance in the information and its use. The quality
of these important parameters is ensured by conducting a proper systems
analysis, designing a suitable information system and ensuring its maintenance
from time to time, and also subjecting it to audit checks to ensure the system
integrity. The quality of the parameters is assured if the following steps are
taken.
·
All
the input is processed and controlled, as input and process design.
·
All
updating and corrections are completed before the data processing begins.
·
Inputs
(transactions, documents, fields and records) are subject to validity checks.
·
The
access to the data files is protected and secured through an authorization
scheme.
·
Intermediate
processing checks are introduced to ensure that the complete data is processed
right through, i.e. run to run controls.
·
Due
attention is given to the proper file selection in terms of data, periods and
so on.
·
Backup
of the data and files are taken to safeguard corruption or loss of data.
·
The
system audit is conducted from time to time to ensure that the information
system specifications are not violated.
·
The
system modifications are approved by following a set procedure which begins
with authorization of a change to its implementation followed by an audit.
·
Systems
are developed with a standard specification of design and development.
·
Information
system processing is controlled through program control, process control and
access control.
·
Ensure
MIS model confirms consistency to business plan satisfying information needs to
achieve business goals.
The assurance of quality is a
continuing function and needs to be evolved over a period and requires to be
monitored properly. It cannot be assessed in physical units of measure. The
user of the information is the best judge of the quality.
9.1 COMPONENTS FOR DESIGN IN MIS
The business application system
demands designing of systems suitable to the application in project. The major
steps involved in the design are the following:
9.1.1 INPUT DESIGN
Input design is defined as the input
requirement specification as per a format required. Input design begins long
before the data arrives at the device. The analyst will have to design source
documents, input screens and methods and procedures for getting the data into
the computer
9.1.2 OUTPUT DESIGN
The design of the output is based on
the requirement of the user – manager, customer etc. The output formats have to
very friendly to the user. Therefore the designer has to ensure the
appropriateness of the output format.
9.1.3 DEVELOPMENT
When the design and its methodology
is approved, the system is developed using appropriate business models. The
development has to be in accordance to a given standard. The norms have to be
strictly adhered to
9.1.4 TESTING
Exhaustive and thorough testing must
be conducted to ascertain whether the system produces the right results.
Testing is time consuming: Test data must be carefully prepared, results
reviewed and corrections made in the system. In some instances, parts of the
system may have to be redesigned. Testing an information system can be broken
down into three types of activities: unit testing, system testing and
acceptance testing
1. Unit testing – also the program testing consists
of testing each program separately in the system. The purpose of such testing
is to guarantee that programs are error free, but this goal is realistically
impossible. Instead, testing should be viewed as a means of locating errors in
programs, focusing on finding all ways to make a program fail. Once pinpointed,
problems can be corrected
2. System testing - tests the functioning of the
information system as a whole. It tries to determine if discrete modules will
function together as planned and whether discrepancies exist between the way
the system actually works and the way it was conceived. Among the areas
examined are performance time, capacity for file storage and handling peak
loads, recovery and restart capabilities and manual procedures
3. Acceptance testing provides the final certification
that the system is ready to be used in a production setting. Systems tests are
evaluated by users and reviewed by management. When all parties are satisfied
that the new system meets their standards, the system is formally accepted for
installation.
9.2 IMPLEMENTATION AND
MAINTENANCE
Define systems conversion as
the process of changing from the old system to the new system. Four main
conversion strategies can be employed. They are the parallel strategy, the
direct cutover strategy, the pilot strategy and the phased strategy.
9.2.1
PARALLEL STRATEGY
Both the old system and its potential
replacement are run together for a time until everyone is assuring that the new
one functions correctly. This is the safest conversion approach because, in the
event of errors or processing disruptions, the old system can still be used as
a backup. But, this approach is very expensive, and additional staff or
resources may be required to run the extra system.
9.2.2
DIRECT CUTOVER STRATEGY
It replaces the old system entirely
with the new system on an appointed day. At first glance, this strategy seems
less costly than the parallel conversion strategy. But, it is a very risky
approach that can potentially be more costly than parallel activities if
serious problems with the new system are found. There is no other system to
fall back on. Dislocations, disruptions and the cost of corrections are
enormous.
9.2.3
PILOT STUDY STRATEGY
It introduces the new system to only
a limited area of the organization, such as a single department or operating
unit. When this version is complete and working smoothly, it is installed
throughout the rest of the organization, either simultaneously or in stages.
9.2.4
PHASED APPROACH STRATEGY
It introduces the new system in stages,
either by functions or by organizational units. If, for example, the system is
introduced by functions, a new payroll system might begin with hourly workers
who are paid weekly, followed six months later by adding salaried employees(
who are paid monthly) to the system. If the system is introduced by
organizational units, corporate headquarters might be converted first, followed
by outlying operating units four months later.
Moving from an old system to a new
system requires that end users be trained to use the new system. Detailed
documentation showing how the system works from both a technical and end-user
standpoint is finalized during conversion time for use in training and everyday
operations. Lack of proper training and documentation contributes to system
failure, so this portion of the systems development process is very important.
9.3 PRODUCTION AND
MAINTENANCE
After the new system is installed and
conversion is complete, the system is said to be in production. During this
stage the system will be reviewed by both users and technical specialists to
determine how well it has met its original objectives and to decide whether any
revisions or modifications are in order. In some instances, a formal post
implementation audit document will be prepared. After the system has been fine-tuned,
it will need to be maintained while it is in production to correct errors, meet
requirements or improve processing efficiency. Once a system is fully
implemented and is being used in business operations, the maintenance function
begins.
·
Systems
maintenance is the monitoring, or necessary improvements. For example, the
implementation of a new system usually results in the phenomenon known as the
learning curve. Personnel who operate and use the system will make mistake
simply because they are familiar with it. Though such errors usually diminish
as experience is gained with a new system, they do point out areas where a
system may be improved.
·
Maintenance
is also necessary for other failures and problems that arise during the
operation of a system. End-users and information systems personnel then perform
a troubleshooting function to determine the causes of and solutions to such
problems.
·
Maintenance
also includes making modifications to an established system due to changes in
the business organizations, and new e-business and ecommerce initiatives may
require major changes to current business systems.
9.4 MANAGING AN
E-BUSINESS
Due to Internet capabilities and web
technology, traditional business organization definition has undergone a change
where scope of the enterprise now includes other company locations, business
partners, customers and vendors.
·
It
has no geographic boundaries as it can extend its operations where Internet
works. All this is possible due to Internet and web moving traditional paper
driven organization to information driven Internet enabled E-business
enterprise.
·
E-business
enterprise is open twenty-four hours, and being independent, managers, vendors;
customers transact business anytime from anywhere. Internet capabilities have
given E-business enterprise a cutting edge capability advantage to increase the
business value.
·
It
has opened new channels of business as buying and selling can be done on
Internet.
·
It
enables to reach new markets across the world anywhere due to communication
capabilities.
·
It
has empowered customers and vendors / suppliers through secured access to
information to act, wherever necessary.
·
The
cost of business operations has come down significantly due to the elimination
of paper-driven processes, faster communication and effective collaborative
working. The effect of these radical changes is the reduction in administrative
and management overheads, reduction in inventory, faster delivery of goods and
services to the customers.
·
In
E-business enterprise traditional people organization based on 'Command
Control' principle is absent.
·
It
is replaced by people organization that is empowered by information and
knowledge to perform their role.
·
They
are supported by information systems, application packages, and
decision-support systems.
·
It
is no longer functional, product, and project or matrix organization of people
but E-organization where people work in network environment as a team or work
group in virtual mode.
·
E-business
enterprise is more process-driven, Technology-enabled and uses its own
information and knowledge to perform. It is lean in number, flat in structure,
broad in scope and a learning organization.
·
In
E-business enterprise, most of the things are electronic, use digital
technologies and work on databases, knowledge bases, directories and document
repositories.
The business processes are conducted
through enterprise software like ERP, SCM, and CRM supported by data warehouse,
decision support, and knowledge management systems. Today most of the business
organizations are using Internet technology, network, and wireless technology
for improving the business performance measured in terms of cost, efficiency, competitiveness
and profitability. They are using E-business, Ecommerce solutions to reach faraway
locations to deliver product and services. The enterprise solutions like ERP,
SCM, and
CRM run on Internet (Internet /
Extranet) & Wide Area Network (WAN).
The business processes across the
organization and outside run on E-technology platform using digital technology.
Hence today's business firm is also called E-enterprise or Digital firm. The
paradigm shift to E-enterprise has brought four transformations, namely:
·
Domestic
business to global business
·
Industrial
manufacturing economy to knowledge-based service economy
·
Enterprise
Resource Management to Enterprise Network Management
·
Manual
document driven business process to paperless, automated, electronically
transacted business process.
These transformations have made
conventional organization design obsolete. In E-enterprise, business is
conducted electronically. Buyers and sellers through Internet drive the market
and Internet-based web systems. Buying and selling is possible on Internet.
Books, CDs, computer, white goods and many such goods are bought and sold on
Internet.
The new channel of business is
well-known as Ecommerce. On the same lines, banking, insurance, healthcare are being
managed through Internet E-banking, E-billing, E-audit, & use of Credit
cards, Smart card, ATM, E-money is the examples of the Ecommerce application.
The digital firm, which uses Internet and web technology and uses E-business
and Ecommerce solutions, is a reality and is going to increase in number.
MIS for E-business is different
compared to conventional MIS design of an organization. The role of MIS in
E-business organization is to deal with changes in global market and enterprises.
MIS produces more knowledge-based products. Knowledge management system is formally
recognized as a part of MIS. It is effectively used for strategic planning for
survival and growth, increase in profit and productivity and so on. To achieve
the said benefits of E-business organization, it is necessary to redesign the
organization to realize the benefits of digital firm.
·
The
organization structure should be lean and flat.
·
Get
rid of rigid established infrastructure such as branch office or zonal office.
·
Allow
people to work from anywhere
·
Automate
processes after reengineering the process to cut down process cycle time.
·
Make
use of groupware technology on
·
Internet
platform for faster response processing
Another challenge is to convert
domestic process design to work for international process, where integration of
multinational information systems using different communication standards,
country-specific accounting practices, and laws of security are to be adhered
strictly.
Internet and networking technology
has thrown another challenge to enlarge the scope of organization where
customers and vendors become part of the organization. This technology offers a
solution to communicate, coordinate, and collaborate with customers, vendors
and business partners. This is just not a technical change in business
operations but a cultural change in the mindset of managers and workers to look
beyond the conventional organization. It means changing the organization
behaviour to take competitive advantage of the E-business technology.
The last but not the least important
is the challenge to organize and implement information architecture and
information technology platforms, considering multiple locations and multiple information
needs arising due to global operations of the business into a comprehensive
MIS.
9.5 E-COMMERCE
E-commerce is a second big
application next to Enterprise Resource Planning (ERP). It is essential deals
with buying and selling of goods. With the advent of intent and web technology,
E-Commerce today covers an entire commercial scope online including design and
developing, marketing, selling, delivering, servicing, and paying for goods.
Some E-Commerce application adds order tracking as a feature for customer to
know the delivery status of the order.
The entire model successfully works
on web platform and uses internet technology.
Ecommerce process has two
participants, namely Buyer and Seller, like in traditional business model.
Unique and typical to E-commerce there is one more participant to seller by authorization
and authentication of commercial transaction. E-Commerce process model can be
viewed in four ways and categories:
·
B2C:
Business Organization to Customer
·
B2B:
Business Organization to Business
·
C2B:
Customer to Business Organization
·
C2C:
Customer to Customer
B2C model - Business organization uses websites
or portals to offer information about product, through multimedia clippings,
catalogues, product configuration guidelines, customer histories and so on. A
new customer interacts with the site and uses interactive order processing
system for order placements. On placements of order, secured payment systems
comes into operation to authorize and authenticate payment to seller. The
delivery system then takes over to execute the delivery to customer.
B2B model - Buyer
and seller are business organizations. They exchange technical and commercial
through websites and portals. Then model works on similar line like B2C. More advanced
B2B model uses Extranet and Conducts business transaction based on the
information status displayed on the buyer’s application server.
C2B model - Customer
initiates actions after logging on to seller’s website or to server. On the server
of the selling organization, E-Commerce applications are present for the use of
the customer. The entire Internet banking process work on C2B model where
account holders of the bank transact a number of requirements such as seeking
account balance, payment and so on
C2C model - Customer
Participates in the process of selling and buying through the auction website.
In this model, website is used for personal advertising of products or
services. E-Newspaper website is an Example of advertising and selling of goods
to customer.
B2B model - The
participants in E-business are two organizations with relations as buyer-seller,
distributor-dealer and so on.
9.6 E-COLLABORATION
Every business has a number of work
scenarios where group of people work together to complete the tasks and to
achieve a common objective. The group could be teams or virtual teams with
different member strength. They come together to platform a task to achieve some
results. The process is called Collaboration. The Biggest Advantage of E-Collaboration
·
It
taps the collective wisdom, knowledge and experience of the members.
·
The
collaboration team or group could be within the organization and between the organizations
as well
·
Since,
E-Collaboration works on an internet platform and uses web technology, work
group/team need not be at one physical location.
·
E-collaboration
uses E-Communication capabilities to perform collaborative tasks or project
assignment.
·
Its
effectiveness is increased by software ‘GroupWare’ that enables the members of
the group to share information, invoke an application and work together to
create documents and share them and so on.
·
E-Collaboration
helps work effectively on applications like calendaring and scheduling tasks,
event, project management, workflow application, work group application.
·
E-collaboration
system components are internet, Intranet, Extranet and LAN, WAN networks for
communication through GroupWare tools, browser.
Let us illustrate the model using an
event in the business such as receipt of material for a job to
be processed on the shop floor. In
this event there is a transaction receipt of material, which needs to be
processed, and then a workgroup will use this information of material receipt.
Each member of this workgroup has a different goal.
9.7 INTRANET
An Intranet is an internal use,
private network inside an organization that uses the same kind of software
which would also be found on the Internet. It is an inter-connected network
within one organization that uses Web technologies for the sharing of information
internally, not worldwide. Such information might include organization policies
and procedures, announcements, or information about new products.
An intranet is a restricted-access
network that works like the Web, but isn't on it. Usually owned and managed by
a company, an intranet enables a company to share its resources with its
employees without confidential information being made available to everyone
with Internet access. A network based on TCP/IP protocols (an internet)
belonging to an organization, usually a corporation, accessible only by the
organization's members, employees, or others with authorization. An intranet's
Web sites look and act just like any other Web sites, but the firewall
surrounding an intranet fends off unauthorized access. Like the Internet
itself, intranets are used to share information.
An intranet is an information portal
designed specifically for the internal communications of small, medium or large
businesses, enterprises, governments, industries or financial institutions of
any size or complexity. Intranets can be custom-designed to fit the exact needs
of businesses no matter where they are situated. A user of intranets consists
mainly of:
·
Members
of the executive team
·
Accounting
and order billing
·
Managers
and directors
·
Sales
people and support staff
·
Customer
service, help desk, etc.
9.8 EXTRANET
An extranet is a private network that
uses the Internet protocols and the public telecommunication system to securely
share part of a business's information or operations with suppliers, vendors,
partners, customers, or other businesses. An extranet can be viewed as part of
a company's intranet that is extended to users outside the company. An extranet
requires security and privacy.
A new buzzword that refers to an intranet
that is partially accessible to authorized outsiders. Whereas an intranet
resides behind a firewall and is accessible only to people who are members of
the same company or organization, an extranet provides various levels of
accessibility to outsiders. You can access an extranet only if you have a valid
username and password, and your identity determines which parts of the extranet
you can view. An extranet is somewhat very similar to an intranet. Extranets
are designed specifically to give external, limited access to certain files of
your computer systems to:
·
Certain
large or privileged customers
·
Selected
industry partners.
·
Suppliers
and subcontractors etc
Therefore, a carefully designed
extranet can bring additional business to your company. Intranets and extranets
all have three things in common:
·
They
both use secured Internet access to the outside world.
·
Both
can drastically save your company or organization a lot of money.
·
Both
need a user ID & password to control access to the whole system.
The professional development team at My Web Services has the
expertise and the right tools to design the right intranet or extranet that
will meet your exact needs, both for today and the Future.
9.9 THE INTERNET
Internet is a global network of
interconnected computers, enabling users to share information along multiple
channels. Typically, a computer that connects to the Internet can access
information from a vast array of available servers and other computers by
moving information from them to the computer's local memory. The same
connection allows that computer to send information to servers on the network;
that information is in turn accessed and potentially modified by a variety of
other interconnected computers. A majority of widely accessible information on
the Internet consists of inter-linked hypertext documents and other resources
of the World Wide Web (WWW). Computer users typically manage sent and received
information with web browsers; other software for users' interface with
computer networks includes specialized programs for electronic mail, online
chat, file transfer and file sharing.
The movement of information in the
Internet is achieved via a system of interconnected computer networks that
share data by packet switching using the standardized Internet Protocol Suite
(TCP/IP). It is a "network of networks" that consists of millions of
private and public, academic, business, and government networks of local to
global scope that are linked by copper wires, fiber- optic cables, wireless
connections, and other technologies. Difference between internet, intranet and
extranet as follow:
Internet is an electronic network of
computers that includes nearly every university, government, and research
facility in the world. Also included are many commercial sites. It started with
four interconnected computers in 1969 and was known as ARPAnet. A network of
computer networks which operates world-wide using a common set of
communications protocols. The vast collection of inter-connected networks
across the world that all use the TCP/IP protocols
Internet is a global network
connecting millions of computers. It is a worldwide network of computer
networks. It is an interconnection of large and small networks around the
globe. The Internet began in 1962 as a resilient computer network for the US
military and over time has grown into a global communication tool of more than
12,000 computer networks that share a common addressing scheme.
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