DRIVE SUMMER 2014

ASSIGNMENT
PROGRAM- BBA
SEMESTER- 2
SUBJECT CODE & NAME
BBA 205
MANAGEMENT INFORMATION SYSTEM
BK ID- B1522
CREDITS 4
MARKS 60


Q.1:Define MIS. Describe the characteristics and functions of MIS.
Meaning of MIS (2 Marks)
Characteristics of MIS (3 Marks)
Describing the functions of MIS (5 Marks)
ANS:
Meaning of MIS:
MIS is an integrated system which provides informationsupport for decision making in organizations.
MIS is successfully used formeasuring performance and making necessary changes in theorganizational
plans and procedures. It helps to build relevant andmeasurable objectives, to monitor results, and to send
alerts.
Characteristics of MIS:
o It supports transaction handling and record keeping.
o It is also called integrated Database Management System whichsupports in major functional
areas.
o It provides operational, tactical, and strategic level managers with easyaccess to timely and for
the most part, structured information.
o It supports decision making which is a vital role of MIS.
o It is flexible which is needed to adapt to the changing needs of theorganization.
o It promotes security system by providing access only to authorizedusers.
o MIS not only provides statistical and data analysis but also works on thebasis of MBO
(management by objectives). MIS is successfully used formeasuring performance and making
necessary changes in theorganizational plans and procedures. It helps to build relevant
andmeasurable objectives, to monitor results, and to send alerts.
o Coordination: MIS provides integrated information so that all thedepartments are aware of the
problems and the requirements of the other departments. This helps in equal interaction of the
different centersand connects the decision centers of the organization.
o Duplication of data is reduced since data is stored in the central part andthe same data can be used
by all the related departments.
o MIS eliminates redundant data.
Describing the functions of MIS
The main functions of MIS are:
Data Processing: Gathering, storage, transmission, processing andgetting output of the data.
Making the data into information is a majortask.
Prediction: Prediction is based on the historical data by applying theprior knowledge
methodology, by using modern mathematics, statisticsor simulation. Prior knowledge varies on
the application and withdifferent departments.
Planning: Planning reports are produced based on the enterpriserestrictions on the companies and
helps in planning each functionaldepartment to work reasonably.
Control: MIS helps in monitoring the operations, and inspects the plans.It consists in the
differences between operation and plan with respect todata belonging to different functional
departments. It controls the timelyactions of the plans and analyzes the reasons for the differences
between the operations and the plans. Thereby, helps managers toaccomplish their decision
making task successfully.
Assistance: It stores related problems and frequently used information toapply them for relative
economic benefits. Through this it can deriveinstant answers to the related problems.
Database: This is the most important function of MIS. All the informationneeds a storage space
which can be accessed without causing any anomalies in the data. Integrated Database avoids the
duplication ofdata and thereby reduces redundancy and hence consistency will beincreased.
The major function of MIS lies in the application of the above functionsto support the managers
and the executives in an organization indecision-making.

Q.2: What do you mean by ERP? Describe the situations before and after the existence of ERP.
Explain the challenges involved in ERP
Definition of ERP (2 Marks)
Explaining the situations before and after ERP (3 Marks)
Explaining the challenges in ERP (5 Marks)
ANS:
Definition of ERP:
It is an integrated cross functionalsoftware that reengineers manufacturing, distribution, finance,
humanresources and other basic business processes of a company to improve itsefficiency, agility and
profitability. ERP is built with a vision to providingbusinesses with an integrated information system.
Explaining the situations before and after ERP:
Before
Prior to the concept of ERP systems, departments within an organization(for example, the human
resources (HR)) department, the payrolldepartment, and the financial department) would have their own
computersystems. The HR computer system (often called HRMS or HRIS) wouldtypically contain
information on the department, reporting structure, andpersonal details of employees. The payroll
department would typically calculate and store paycheck information. The financial department
wouldtypically store financial transactions of the organization. Each system wouldhave to rely on a set of
common data to communicate with each other.
After
ERP software, among other things, combined the data of formerly separate applications. This made the
worry of keeping numbers in synchronizationacross multiple systems disappear. It standardized and
reduced the numberof software specialties required within large organizations.
Explaining the challenges in ERP
Success depends on the skill and the experience of theworkforce, including training in how to make the
system work correctly.Many companies cut costs by cutting training budgets. Privately ownedsmall
enterprises are often undercapitalized, meaning their ERP system isoften operated by personnel with
inadequate education in ERP in general,such as APICS (advancing productivity, innovations and
competitivesuccess) foundations, and in the particular ERP vendor package beingused.
Personnel turnover: companies can employ new managers, lackingeducation in the company's
ERP system, proposing changes in businesspractices that are out of synchronization with the best
utilization of thecompany's selected ERP.
Customization of the ERP software is limited. Some customization mayinvolve changing of the
ERP software structure which is usually notallowed.
Re-engineering of business processes to fit the "industry standard"prescribed by the ERP system
may lead to a loss of competitiveadvantage.
ERP systems can be very expensive to install often ranging from 30,000US Dollars to
500,000,000 US Dollars for multinational companies.
ERP vendors can charge sums of money for annual license renewal thatis unrelated to the size of
the company using the ERP or its profitability.
Technical support personnel often give replies to callers, that areinappropriate for the caller's
corporate structure. Computer securityconcerns arise, for example when telling a non-
programmer how tochange a database on the fly, in a company that requires an audit trail
ofchanges so as to meet some regulatory standards.
ERPs are often seen as too rigid and too difficult to adapt to the specificworkflow and business
process of some companies this is cited as oneof the main causes of their failure.
Systems can be difficult to use.
Systems are too restrictive and do not allow much flexibility inimplementation and usage.
The system can suffer from the "weakest link" problem inefficiency inone department or in one
of the partners may affect other participants.
Many of the integrated links need high accuracy in other applications towork effectively. A
company can achieve minimum standards, and thenover the course of time "dirty data" will
reduce the reliability of someapplications.
Once a system is established, switching costs are very high for any oneof the partners (reducing
flexibility and strategic control at the corporatelevel).
The blurring of company boundaries can cause problems inaccountability, lines of responsibility,
and employee morale.
Resistance to sharing sensitive internal information betweendepartments can reduce the
effectiveness of the software.

Q.3: Explain the applications and systems used in E-communication.
Application and systems used in E-communication (10 Marks)
ANS:
Application and systems used in E-communication:
In e-business world, e-communication system is a backbone of allprocesses whose role is to share
information by messages or storeinformation to be downloaded on access by the customer. This is
donethrough many applications and systems. Most popular and widely usedmessaging systems are e-mail
& voice-mail. Through these systems bothparties communicate on ongoing basis. It provides facilities to
store deleteand search mails, supporting the reference need of the user. This system ispopular when one to
one communication is needed.When there is a need for communication in real time, systems available
arevoice conferencing, Video conferencing and electronic meeting. Voiceconferencing is conducted on
telephone network using speaker phones ornetworked PCs with Internet telephone connectivity. Video
conferencingprovides capabilities of video and audio for participants situated at differentlocations. Video
conferencing also becomes an interacting and effectivecommunication system when it has a feature of
white boarding anddocument sharing.
In electronic meeting system, participants sit in ameeting room with networked PCs and online screen
projector to discussthe meeting agenda. PC network is chosen for communication, andaccessing databases
and processing and projecting them on the screen forcommon viewing. This system is useful to solve
some problems andcommunication within small groups.
E-communication systems are capable of sending messages, documents,and files in any format over
Internet. The communication could be online inoffline mode and online in real time mode. All e-
communication systemshave sufficient safeguards, which make them secure for use. Internet andweb
technologies are used for forming different interest groups tocommunicate and share the information.
These groups are popularly knownas 'user groups' who have common interest in a subject, technology or
tool,and come together with the objective of improving the quality of the subjectof interest by sharing the
experience.Enterprise information portal is another tool used for information posting andcommunicating
to users or customers. Portal is a web-based interface onan integrated internet / intranet / extranet platform
allowing customers to useapplications and other services. It provides secure access to all users
andconsumers to search for information, analyse the situation andcommunicate. The difference between a
website and a portal is that thelatter is a comprehensive multipurpose repository of
information,applications and tools to serve the consumers.

Q.4: There is an information explosion in todays society. There are lot of advantages of DBMS like
proper maintenance of the data and maintaining security. Explain the process of data transition
using diagram and an example of your own.
Drawing the diagram (2 Marks)
Explaining the process of data transition with an example (3 Marks)
Explaining the process (5 Marks)
ANS:
Process of data transition
Data that has been processed is referred to as information. Information helps in analysis and decision
making. It is observed that information is obtained from the data but not all data produce useful
information. Information is useful when it is relevant, reliable, accurate, up-to-date, timely, complete,
intelligent, consistent and convenient to the recipient. An information system is designed in a way to
process data to a meaningful form, i.e., to accept input, manipulate it in some way and produce output.
DBMS helps in gathering and providing reports. The set of data that is stored in row and columns to
perform a specific task is referred to as DBMS.
The main function of the information systems is to convert data into information. Figure depicts how data
is converted into information using the intermediate processes. The information systems can perform its
function only with the proper organisation and structure to convert data into information. Data represents
a fact or statement of event without relation to other things.

Fig. 1: The Process of Changing Data into Information (Organisation structure

Figure below depicts the diagrammatic representation of data to information, to knowledge and to
wisdom.

Fig. 2: Transition of Data to Information, Knowledge and Wisdom.

E.g.: It is raining.
Here information embodies the understanding of a relationship of some sort,
like cause and effect.
E.g.: The temperature dropped 15 degrees and then it started raining. Knowledge represents a pattern that
connects and provides a high level of predictability as to what is described or what will happen next.
E.g.: If the humidity is very high and the temperature drops substantially, the atmosphere will hold the
moisture so it rains.
Wisdom represents understanding of fundamental principles personified within the knowledge that is the
basis for the knowledge being what it is. Wisdom is essentially systemic.
E. g.: It rains because it rains. And this includes an understanding of all the interactions that happen
between raining, evaporation, air currents, temperature gradients, changes and raining.

Q.5: There are two investment plans in the market whose details are given below based on which
you need to decide which investment plan you need to select. Suggest which investment plan you
prefer and why?
Particulars Plan A Plan B
Investment in Rs. Million 3 2.7
Savings/ gain per year in Rs. Million 1.0 0.75
No. of years savings or gain would occur 5 5
Discount Rate 12% 12%
Reasoning about the 2 plans (2 Marks)
Writing 2 Formulae (2 Marks)
Answering which plan is better (1 Marks)
Calculations and correct answers (5 Marks)
ANS:
Formulae :
In above investment analysis, the Net Present Value (NPV) is calculated and compared with all the
investment alternatives.

NPV = (PV of further Cash flow) Investment = PV I

The formula used for the present value PV is:

Formula: PV= S[1-(1+i)
-T
]/ I

Where T is a number of period, in which an amount S for each period is to be received and i is a discount
rate.

Calculations :
For Plan A:

S = 1.0 i = 0.12 T = 5 I = 3

So after putting all the values in the above formula , we get :

PV = 1.0 [ 1- (1+0.12)
-5
]/ 0.12 = 3.605

Therefore, NPV = 3.605 3 = 0.605

For Plan B:

S= 0.75 i = 0.12 T = 5 I = 2.7

So after putting all the values in the above formula , we get :

PV = 0.75 [ 1- (1+0.12)
-5
] / 0.12 = 2.704

Therefore, NPV = 2.704 2.7 = 0.004

From the above data: since Plan A has more NPV we should select plan A. Plan A is a better investment
plan because NPV of plan A is 0.605 which is more than plan B which is equal to 0.004.


Q.6: Write short notes on the following:
a) Transaction Processing System (TPS)
b) Knowledge Based System (KBS)
Concept of Transaction Processing System (5 Marks)
Concept of Knowledge Based System (5 Marks)
ANS:
Concept of Transaction Processing System:
The act of conducting or carrying out a deal or business agreement, an exchange or trade, as of ideas,
money etc. A transaction is the smallest unitof business activity, may be uses of records are themselves
transactions.Transactions are mainly observed at the bottom level of the management.Plenty of
operational activities at the bottom level result in one or moretransactions. Every transaction may be
considered to generate information.The information generated can be highly structured. Structured
informationis easy to process further. Examples payroll system, transport ticketreservation system,
purchase order entry system, marks tabulation systemetcTPS offers the following characteristics. These
characteristics areresponsible for the TPS to perform methodical, standardized and reliabletransactions.
Reliability: TPS incorporate safeguard and disaster recovery methods toensure transaction
security and also remain operational permanently.
Rapid processing: TPS process transactions very fast due to the virtualtransaction processing.
Standardization: To maximize efficiency of the transactions, TPSinterfaces consider identical
data for every transaction, irrespective ofthe customer.
Concept of Knowledge Based System:
KBS are the systems based on knowledge base. Knowledge base is thedatabase maintained for knowledge
management which provides the meansfor data collections, organization and retrieval of knowledge. The
knowledgemanagement manages the domain where it creates and enables anorganization for adoption of
insights and experiences.
There are two types of knowledge bases:
a. Machine readable knowledge bases: The knowledge base helps thecomputer to process through. It
makes the data in the computer areadable code which makes the operators performance easier.
Suchinformation is used by semantic web. Semantic web is a web that makes
a. description of the system that a system can understand.
b. Human readable knowledge bases: They are designed to help people toretrieve knowledge. The
information needs to be processed by thereader. The reader can access the information and synthesize his
own.