Decision Making and Information Systems

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Management Information System

Submitted To

Lecturer MS. Samima Parvez

Subject : Decision Making and Information Systems

Group : D

PRESENTER ID & NAME

2

4

31

33

5

1022114412 Md. Ariful Islam Saimon Chy

Md.Shahadat Hossain1022114372

Imteaj Ibna Hossain1021114362

Md. Rasel1022114413

Md.Shazzad Hossain1022114384

Decision Making and Information Systems

Introduction: Today information systems provide information to all levels of management of an organization .So all the levels are responsible for decision making.Decision making is the developing concepts leading to the selection of a course of action among variations. Every decision making process produces a final choice, It can be an action or an opinion. It begins when we need to do something but we do not know what e.g. Decision to raise a Purchase Order Management Information Systems

Objectives of the project

The objectives of our project are to find the answer of the following questions

1.What is the business value of improved decision making?

2.How many types of decisions are exist in different levels of management?

3.What information system is needed for what type of decision making /level of management?

4.How decision making process work?

5.How information system effect management role take decision?

Business value of improved decision making

Decisions must be made every level of management of an organization. Improved decisions can increase the average ROI and profitability of an organization.

A single improved decision may effect in business value a little but numerous improved decisions can change the annual business value wholly.

Unstructured

Semi structured

Structured

Decide entrance or exit from approve capital budget Decide long-term goals

Design a marketing planDevelop a departmental budgetDesign a new corporate Web site

Determine overtime eligibility

Restock inventory Offer credit to

customers Determine special offers to

customers

Types of decisions

Information systems requirement for decisionmaking & Mgt. Level

Types of decisions

Managerial levels

information system needed

Aspects

Senior Manager Executive SupportSystem (ESS)

Middle Manager Management Information System(MIS) & Decision Support System (DSS)

Operational management

Transaction Processing System (TPS)

Unstructured

Semi structured

Structured

Unstructured decisions The decisions are made by senior management. It is a non routine type decision. There is no specific procedure or structure for decision making. It includes strategic issues and long term effect of decision.

Structured decisions

These decisions are made by operational managers. It is a repetitive and non routine type decision. There are specific structures and procedures for solving a problem and decision making. It involves operational issues and has a very short time effect.

These decisions are made by operational managers. It is a repetitive and non routine type decision. There are specific structures and procedures for solving a problem and decision making. It involves operational issues and has a very short time effect.

These decisions are made by middle management. It is both routine and non routine type decisions. Usually it gives a clear cut solution of a problem. There is both structured and unstructured procedure for decision making.

These decisions are made by middle management. It is both routine and non routine type decisions. Usually it gives a clear cut solution of a problem. There is both structured and unstructured procedure for decision making.

Semi structured decisions

Types of decisions

What information system is needed for what type of decision making /level of management?

It needs special consideration, insight, judgment and evaluation. So information systems may not effective for all time. In spite of that decision maker can use ESS.

It needs special consideration, insight, judgment and evaluation. So information systems may not effective for all time. In spite of that decision maker can use ESS.

For being a two way decision two different information systems are used for decision making. These are MIS (used for structured decision making) and DSS (for non structured decision making).

It works with daily affairs or transactions.So it uses TPS where such data (credit, reipts, sales, labour works etc.)are recorded.

It works with daily affairs or transactions.So it uses TPS where such data (credit, reipts, sales, labour works etc.)are recorded.

How decision making process work?

Simon (1960)introduced a Decision Making Process which includes four stages. In his theory he discussed in detail that how actually decision making process works. The following diagram was given by Simon. Now we can discuss it in our way:

Intelligence

Design

Choice

Implementation

Problem Discovery :What is the Problem ?

Solution Discovery :What are the possible Solutions?

Choosing Solutions :What is the best solution

Solution Tasting : Is the solution working ? Can we make it work better?

The decision-making process is broken down into four stages

STAGES IN DECISION MAKING

Intelligence :Decision making process starts with discovering (what), identifying (where) and understanding (why) the problem is occurring in the organization. And this is what the intelligence concern with Design :After discovering, identifying and understanding the problem, decision maker find some possible solution for the problem a rised. Which is called Designing the solution. Choice :What solution alternative should be the perfect match for the problem among solution alternatives is the concern of this stage.

Implementation:This is the situation where actually the decision is applied. After applying the decision, Decision makers continuously monitor is the decision is right.The decision making process may work like a cycle when the taken decision works properly. Then decision maker again through same stages. Then the decision cycle will be like following.

Intelligence :Decision making process starts with discovering (what), identifying (where) and understanding (why) the problem is occurring in the organization. And this is what the intelligence concern with Design :After discovering, identifying and understanding the problem, decision maker find some possible solution for the problem a rised. Which is called Designing the solution. Choice :What solution alternative should be the perfect match for the problem among solution alternatives is the concern of this stage.

Implementation:This is the situation where actually the decision is applied. After applying the decision, Decision makers continuously monitor is the decision is right.The decision making process may work like a cycle when the taken decision works properly. Then decision maker again through same stages. Then the decision cycle will be like following.

Coordinating

OrganizingPlanning

5 functions

ControllingDeciding

Managerial Roles& Real world decision making

1.Classical models :It includes the following tradition roles of organization This traditional role cannot give us actual information what managers do in organization

1.Classical models :It includes the following tradition roles of organization This traditional role cannot give us actual information what managers do in organization

Decision making is a part of Managerial role. So we first need to understand what roles a managers play in organization

Managerial Roles: There are two Models to descried managerial roles

Functions of organization

Managerial Roles& Real world Decision Making

Behavioral Models :Actual behavior of managers appears to be less systematic,more informal, less reflective, more reactive, and less well organized than in classical model There managers roles are described more detailed then classical models.Mintzberg tells 10 roles which falls in there dimensions .There are Explained in following figure.

Interpersonal rolesInterpersonal roles Informational rolesInformational rolesDecisional rolesDecisional roles

Nerve center

Disseminator

Spokesperson

Entrepreneur

Disturbance handler

Resource allocator Negotiator

Figurehead

Leader

Liaison

Real World Decision Making

We saw that information System are not needed by all managerial roles but some. But in the real world decision making is something else, for three reasons information systems are not helpful for decision making

Information …Quality

Management ….Filters

Organizational __Culture

Real World Decision Making

REAL WORLD DECISION MAKING

.

1. Information Quality: Decision may suffer if the information quality doesn’t meet the decision quality.

2. Management Filters: Information collected by managers through a series of filters. Where information are rejected if it does not conform to manager

3. Organizational Culture: some strong forces within organization such as their capabilities and competencies resist making decision where major changes in business processes are involved.

1. Information Quality: Decision may suffer if the information quality doesn’t meet the decision quality.

2. Management Filters: Information collected by managers through a series of filters. Where information are rejected if it does not conform to manager

3. Organizational Culture: some strong forces within organization such as their capabilities and competencies resist making decision where major changes in business processes are involved.

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