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[MCS-052] Discuss why management needs information. Is it possible for the management of an organization to make effective decisions without the aid of an information system? Explain.

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To facilitate the management decision making at all levels of company, the MIS must be integrated. MIS units are companywide. MIS is available for the Top management. The top management of company should play an active role in designing, modifying and maintenance of the total organiza tion wide management information system.

Information system and Information technology have become a vital component of any successful business and are regarded as major functional areas just like any other functional area of a business organization like marketing, finance, production and HR. Thus it is important to understand the area of information system just like any other functional area in the  business. MIS is important because all businesses have a need for information about the tasks which are to be performed. Information and technology is used as a tool for solving problems and providing opportunities for increasing productivity and quality.

Information has always been important but it has never been so available, so current and so overwhelming. Efforts have  been made for collection and retrieval of information, However, challenges still remain in the selection analysis and interpretation of the information that will further improve decision making and productivity.

MIS for a Business Organization :

a. Support the Business Process :

Treats inputs as a request from the customer and outputs as services to customer. Supports current operations and use the system to influence further way of working.

b. Support Operation of a Business Organization :

MIS supports operations of a business organization by giving

organizations of the world. Basically the technology based information system is not very old. In past organizations used to use traditional management information system. The main purpose of management information system is to ensure the flow of appropriate information to the appropriate people of organization as well as parties related with organization. So that they can (Internal and external decision makers) can make good decisions for running the organization. The entire process objective is to provide complete, timely, reliable and quality information's to the decision makers. Todays managers depend on information systems for decision making. The managers have handful of data around them but manually they cannot process the data accurately and with in the short period of time available to them due to heavy competition in modern world. Therefore mangers depend on information systems.

Q. What do you mean by the term system?

The word ‘System’ is used quite often in our everyday life.
We talk about an educational system, political system, economic system, circulatory system, solar system, computer system, and so on. The common feature, which all these systems share, is that they are a collection of elements integrated to achieve the required goals. To be more specific and precise, a system may  be defined as a set of elements, joined together to achieve a common objective. For example, a business organisation can  be considered as a system, in which the parts (divisions, departments, sections, units, etc.) are joined together for a common goal. In such an organisation, it is clear that a system is not a randomly assembled set of elements; rather it consists of elements which can be identified as related to each other  because of a common purpose or a goal.
The word ‘system’ means different things to different people in different situations. If an office supervisor in a chairman’s office is asked ‘what is your system, it just means ‘I-Iow do you keep your files in such a way as to take one when wanted by  your boss? Q. Explain the important characteristics of information?  Ans: Some of the characteristics of good information are discussed as follows:

i. Understandable:

Since information is already in a summarized form, it must be understood by the receiver so that he will interpret it correctly. He must be able to decode any abbreviations, shorthand
notations or any other acronyms contained in the information.

ii. Relevant:

Information is good only if it is relevant. This means that it should be pertinent and meaningful to the decision maker and should be in his area of responsibility.

iii. Complete:

It should contain all the facts that are necessary for the decision maker to satisfactorily solve the problem at hand using such information. Nothing important should be left out.  Although information cannot always be complete, every reasonable effort should be made to obtain it.

iv. Available:

Information may be useless if it is not readily accessible ‘ in the desired form, when it is needed. Advances in technology have made information more accessible today than ever  before.

 v. Reliable:

The information should be counted on to be trustworthy. It should be accurate, consistent with facts and verifiable. Inadequate or incorrect information generally leads to decisions of poor quality. For example, sales figures that have not been adjusted for returns and refunds are not reliable.

 vi. Concise:

Too much information is a big burden on management and cannot be processed in time and accurately due to “bounded rationality”. Bounded rationality determines the limits of the
thinking process which cannot sort out and process large amounts of information. Accordingly, information should be to the point and just enough
 no more, no less.

 vii. Timely:

Information must be delivered at the right time and the right place to the right person. Premature information can become obsolete or be forgotten by the time it is actually needed. Similarly, some crucial decisions can be delayed because proper and necessary information is not available in time, resulting in missed opportunities. Accordingly the time gap  between collection of data and the presentation of the proper information to the decision maker must be reduced as much as possible.

 viii. Cost-effective:

The information is not desirable if the solution is more costly than the problem. The cost of gathering data and processing
it into information must be weighed against the benefits derived from using such information.


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