Management Information Systems

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Management Information Systems

Functions

MIS Inputs

MIS - Outputs

Characteristics

Overview

Competitive Advantage

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MIS in Perspective

Primary Purpose of an MIS:• To provide managers with information

(reports) for effective decision making and feedback on daily operations.

Without these reports, we’dbe as dumb as we look.

We are the bad guysfrom Bad Guy’s Auto.

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MIS Outputs (Reports)

We use these reports:•scheduled reports,•key-indicator reports,•demand reports,•exception reports, and•drill-down reports.

I get turned on bydemand reports.

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Just what is ascheduled reportfor us at Bad Guy’sAuto?

MIS Scheduled Reports

Scheduled Report:• Reports which are produced on a schedule:

• Daily, weekly, monthly, quarterly, semiannually, and annually.

For us, a scheduledreport might showhow many cars werereturn last weekbecause of seriousdefects.

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MIS Scheduled Report

Weekly Defect ReportWeek Ending November 22, 2020

Scheduled Report

ConditionSold Returns Minor Serious Status 216 129 19 110 Normal( >50%)

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MIS Key-indicator Report

Key-indicator Report:• A special type of scheduled report.• Daily reports which summarize the previous

day’s critical activities.• Usually linked to critical success factors.

What is a key-indicator reportfor us at Bad Guy’sAuto?

For us, a key-indicatorreport would be thenumber of defective carswe sold at our dailyauction.

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MIS Key-indicator Report

Daily Auction ReportWeek Ending November 22, 2020

Key-indicator Report

Qty Amount As Is Status24 $34,023 23 Normal

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MIS Demand Reports

Demand Report:

• A non-scheduled report needed at the moment by management.

• A report produced on demand.

Tell us how weuse demand reports.

Last week I demandeda report showing therevenues for salvagedcars over the last 10years.

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MIS Demand Reports

Salvage Revenues (10 yrs.) ReportWeek Ending November 22, 2020

Demand Report

Cars Lost to Salvage Quanty Amount

24,524 $341,023

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MIS Exception Reports

Exception Report:

• A report automatically generated when an unusual event takes place, which usually requires management action.

Tell us how weuse exceptionreports.

If we have fewer than50 percent returnsbecause of defects,an exception reportis generated.

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MIS Exception Reports

Yes Sir, I saw the exceptionreport. Could it be that weare paying too much for ourcars?

Exception Defect ReportWeek Ending November 27, 2020

ConditionSold Returns Minor Serious Status 126 5 4 1 Abnormal ( <50%)

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MIS Drill-Down Reports

Drill Down Reports:

• These reports provide increasingly detailed information about a situation.

I can’t understand it. Ourearnings are up 25% forthe quarter.

Let’s use drill downreports and find outwhy earnings are upso much.

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MIS Drill-Down Reports

2nd Qtr. 2020 $12.5 $10.0 25.0%

1st Qtr. 2020 $10.8 $10.7 0.9%

Earnings by Quarter (Millions)

Actual Forecast Variance

1st Level

Gross Sales $112.5 $100.0 12.5%

Expenses $100.0 $90.0 11.1%

Profit $12.5 $10.0 25.0%

Sales and Expenses (Millions)

2nd. Qtr. Actual Forecast Variance

2nd Level

3rd Level

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MIS Drill-Down Reports

Adams, Tom 5.5 $5.2 5.7%

Jones, Paul $6.2 $6.0 3.3%

Kim, Jim $2.3 $2.5 -6.7%

Robbins, Julia $15.0 $1.5 900.0%

Etc. ……. ….. ……..%

Sales by Salesperson (Millions)

Actual Forecast Variance

3rd Level

Julia Robbins

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MIS Drill-Down Reports

Boys, as you can see.I’ve got what it takes.

Bad G

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MIS Inputs

Inputs to an MIS:• Internal Data(Always used)

• TPS - Transaction Processing System• External Data (Could be used)

• Customers, suppliers, competitors, marketplace, etc.

What are the inputsto our MIS.

Our inputs are internal data and external data.

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The End of the Bad Guy’s

Sir, five people from the State’sAttorney’s Office are here withwarrants for your arrests. They’reaccusing you guys of consumerfraud.

Bye, bye bad guy’s.

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Characteristics of an MIS

1st Characteristic

Drill Down ReportsException Reports

Demand ReportsScheduled Reports

Basic Reports Standardized and Fixed Report Formats

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Characteristics of an MIS

2nd Characteristic

Use Internal Data Stored in the Computer System

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Characteristics of an MIS

3rd Characteristic

MIS systems are developed & implemented byIS personnel, not users. Users help in the design.

Systems Analyst Programmer

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Characteristics of an MIS

4th Characteristic

MIS systems require formal requests from users.

Oh please acceptthis written request.

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Travel Agent

MIS for a Competitive Advantage

American’s Sabre System

SabreAmerican

Flights

Sabre System:

•American’s flights came up first.

•Gave American too much advantage.

•Legal problems.

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Hospitalpurchasingagent

MIS for a Competitive Advantage

American Hospital Supply’s System

WelcomeAmericanHospitalSupply

American Hospital Supply System (AHS):

•Online order entry system.

•AHS now dominates hospital supply market.

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Functional Organization of MIS

FinancialMIS

ManufacturingMIS

MarketingMIS

HRMIS

R&DMIS

Other ...MIS

MIS

Drill Down ReportsException Reports

Demand ReportsScheduled Reports

Basic Reports

Key-indicatorReports

Businesstrans-actions

TPS

ExternalData

TransactionData

Non-integrated MIS Sub-systems

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Functional Organization of MIS

Integration by Common Database

ManufacturingMIS systemsand databases

Marketing MISsystems anddatabases

Other MISsystems anddatabases

Shared reportsStrategic reports

Tactical reportsOperational reports

Shared reportsStrategic reports

Tactical reportsOperational reports

Shared reportsStrategic reports

Tactical reportsOperational reports

Database

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Manufacturing MIS (Inputs)

Inputs to the Manufacturing MIS:(1) Strategic Plan:

• Quality goals• Production goals• Customer Service goals• Constraints

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Manufacturing MIS (Inputs)Inputs to the Manufacturing MIS:(2) The TPS: Receiving and Inspecting Data

• Receiving Department.• Inspects, accepts, and delivers to depts.

• Quantity, quality, and arrival of raw materials.• Reports used to monitor suppliers.

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Manufacturing MIS (Inputs)

Inputs to the Manufacturing MIS:(3) The TPS: Inventory data.

• Quantity on hand, use of raw materials, work in process, and finished goods.

• Reports used to reorder, identify shortages, surpluses, poor quality, and for tracking.

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Manufacturing MIS (Inputs)

Inputs to the Manufacturing MIS:(4) The TPS: Personnel data.

• Labor data using salaries, time cards and industrial data collection (time study info) devices.

• Reports used to estimate labor costs and develop time schedules.

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Manufacturing MIS (Inputs)

Inputs to the Manufacturing MIS:(5) The TPS: Order Processing.

• Placing, canceling, and making adjustments to orders..

• Reports used for production scheduling, labor and raw material requirements.

• Could be hooked to EDI.

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Manufacturing MIS (Inputs)

Inputs to the Manufacturing MIS:(6) External sources:

• New manufacturing and design techniques collected from outside companies, journals, seminars.

• Prediction of labor and material costs from labor supply and inflation data.

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Manufacturing MIS (Subsystems)

Manufacturing MIS subsystems:(1) Design and Engineering

• CAD - Computer-Assisted Design• Aids in the design of new products.• Aids in updating existing products.• Used to analyze problems with existing

products. CAD

AutoCAD

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Manufacturing MIS subsystems:(2) CAM (Computer Assisted

Manufacturing).• Computers that directly control

production equipment:• Robots.• Drilling Machines.• Welding Machines.• Assembly Lines.

• Have self-diagnostic routines.• Usually easy to program.

Manufacturing MIS (Subsystems)

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Manufacturing MIS (Subsystems)

Manufacturing MIS subsystems:(3) Master Production Scheduling

• Provides a detailed plan for every item to be manufactured.

• Indicates the quantity to be produce by time period, such as, the disks below.

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Manufacturing MIS (Subsystems)

Manufacturing MIS subsystems:(4) Inventory control

• Automatic reordering, forecasting, shop reports and documents.

• EOQ- Economic Order Quantity.• ROP- ReOrder Point.• MRP- Material Requirements and

Planning. More

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Manufacturing MIS (Subsystems)Manufacturing MIS subsystems:(4) Inventory control

• MRPII - Manufacturing Resource Planning, which focuses on three questions for finished products:• What does the customer need?

• Demand forecasting.

• What do we have in inventory?• Inventory control.

• What should we make?• Production planning. More

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Manufacturing MIS (Subsystems)Manufacturing MIS subsystems:(4) Inventory control

• MRPII - Manufacturing Resource Planning, which focuses on three questions for unfinished products:• What materials are needed?

• Bill of materials.

• What do we have in inventory?• Inventory control.

• What do we have to get?• Supply planning. More

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Lucent Technology’s Inventory Control system

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Manufacturing MIS (Subsystems)

Manufacturing MIS subsystems:(4) Inventory control

• JIT - Just-In-Time• Materials and supplies are

delivered JUST in time for use.

• Auto industry approaches zero inventory.

• Has been very successful.

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Manufacturing MIS subsystems:(5) CIM (Computer Integrated Manufacturing).

• CIM’s goal is to tie all aspects of production together.

Manufacturing MIS (Subsystems)

Design

Order Processing

Shipping

Harley

Manufacturing

Inspection

CIM

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Manufacturing MIS subsystems:(5) CIM (Computer Integrated Manufacturing).

• CIM’s goal is to tie all aspects of production together.

Manufacturing MIS (Subsystems)

Play Nucor Steel video-1. (11 minutes)Play Nucor Steel video-2. (5 minutes)

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