INFS 432 ORGANIZATIONAL INFORMATION SYSTEMS Lecture 4 – Organizational Decision-Making and Information Systems Lecturer: Mr. Michael Allotey & Prof. Harry Akussah Contact Information: mallotey@ug.edu.gh School of Information and Communication Studies Department of Information Studies Second Semester (2018-2019)
Lecture Overview Information systems are used to support the functions of organizations. Organizations employ information systems for various reasons such as simplifying decision making. Students will best appreciate the various type of information systems if they understand decision making and the types of decisions in organizations. Slide 2
Session Outline The key topics to be covered in the session are as follows: 1. Introduction 2. Defining Decision Making 3. Characteristics of Organizational Decisions 4. Types of Organizational Information Systems Slide 3
Reading List • Laudon, C.K. Laudon, J.P. (2000) Management Information Systems (11th Ed.), NJ, Prentice-Hall in Honkong, Pearson. • Senn, J.A. (1982) Information Systems in Management, NY Wadsworth Publishing Company. • Stoner, J.A.F. (1999) Management, (1999) Prentice-Hall of India, New Delhi. • Lucey Terry, (1995) Management Information Systems, DP Publishing Ltd. Aldine Place, London. • Watson, H.J. et al (1991) Information System for Management: A Book of Reading. • Hutchinson , S.E. & Sawyer, S.C. (2000) Computers, Communications and Information: A User’s Introduction. • Alter, S. (1999). Information systems: A management perspective. Reading, Mass. [u.a.: Addison Wesley. • O’Brien , J.A. (2009) Introduction to Information Systems, Boston, Pearson. • Long, P. et al (2016) Cambridge International AS and A Level IT Coursebook, University Printing House, Cambridge CB2 8BS, UK. Slide 4
Topic One INTRODUCTION Slide 5
Introduction • Information gained from the organization's usual activities (Information produced and stored in information systems), are used to help the organization make decisions. • Each type of decision has different characteristics. Slide 6
Topic Two DEFINING DECISION MAKING Slide 7
What is Decision Making? • Decision making is the process of selecting a course of action among several alternatives. • The purposeful selection from among a set of alternatives in the light of a given objective. Slide 8
Types and Levels of Organizational Decisions TYPE OF DECSION ORGANIZATIONAL LEVEL • Structured • Operation Level Decisions • Managerial or • Semi-Structured Tactical Level Decision • Strategic or • Unstructured Executive Level Decisions Slide 9
Topic Three CHARACTERISTICS OF ORGANIZATIONAL DECISIONS Slide 10
Characteristics (Examples) of Organizational Decisions • Operational Decisions • Tactical Decisions • Strategic Decisions Slide 11
Operational Decisions These are decisions about the organization’s activities now and within the next 6 to 12 months. For example: 1. A number of production employees are off sick – what do you do in the short term to ensure that production is not affected? 2. What raw materials will we need today? 3. Can we organize ourselves differently and speed up operations? Slide 12
Discussion Activity • What sort of Information will the organization need in order to make the decisions above? • Who has called in sick today, and how long are they likely to be away from work? • What is going to be produced today (we will assume that the raw material stock was checked a few days prior to today) and do we have assurance that the raw materials have been moved to the production area? • A floor plan and production flow information (looking at how the goods move through the production line). Slide 13
Tactical Decisions These are decisions about what will happen within the organization in the next five years or so. These decisions are often informed by research, to ensure that the organization remains safe in the medium term. Slide 14
Tactical Decisions For example: 1. Are there any new products or service that we should be offering? 2. Are there any existing products or service that we should stop offering? 3. Do we need to make any capital investment to meet the organization's longer-term strategy? 4. Does our workforce need any training to enable us to meet our longer-term goals? Slide 15
Discussion Activity What sort of Information will the organization need in order to make the decisions above? 1. Information about what competitors are making. Information about what customers’ changing wants are. 2. Stock information on existing products and information about stock movement. 3. What our current capital reserves are. If there is insufficient finance available, should we be taking out a business loan to finance future strategies? 4. What training does our workforce have? Will this training be sufficient and suitable to enable us to meet our mid-term goals, or do we need to have some staff trained? What training courses are available? Slide 16
Strategic Decisions These are decisions that have a long time frame and require organizations to look well into the future (in excess of about five years). For example : • Should we expand? • Should we buy larger premises? • How should the organization be structured? Slide 17
Discussion Activity What sort of Information will the organization need in order to make the decisions above? 1. Estimates of how our organization will develop over the next five to ten years. 2. The costs of larger premises, including the anticipated overheads on such a property (such as city tax, average heating and lighting costs), so that they can be compared with current expenditure on these items. 3. The current organizational structure should be identified and written down, so that managers can discuss whether changes in the hierarchy could be achieved and how they see these changes being implemented. Slide 18
Topic Four TYPES OF ORGANIZATIONAL INFORMATION SYSTEMS Slide 19
Introduction In general terms the information produced by information systems is used in the following organizational activities: • Planning • Decision making • Controlling operations • Forecasting the future Realistically, these activities are undertaken in all functional areas of an organization. Slide 20
Types of Organizational Information Systems There are two main categories of organizational information systems: • Operations Support Systems (OSS). • Management Support Systems (MSS). Slide 21
Topic Five OPERATION SUPPORT SYSTEMS Slide 22
Operation Support Systems (OSS) These are information systems which generate a variety of general information products to support the general day-to-day operations of organizations. Their targets are mostly to support operations at the operational levels. Examples of Operations Support Systems are: • Transaction Processing Systems (TPS), • Process Control Systems (PCS) • Enterprise Collaboration System (ECS) Slide 23
Transaction Processing Systems (TPS) • This is a category of OSS that generally record and process data resulting from the fundamental activities of the organization. • TPS generally process sales, purchase, inventory and other organizational database. These database then provide the data resources that can be processed and used by Decision Support Systems (DSS) and Executive Information Systems (EIS). • TPS processes transactions into two ways: – Batch Processing – Online Processing Slide 24
Transaction Processing Systems (TPS) Examples: • Electronic Point of Sales Terminals (EPoST) • Payroll Systems • Stock Control Systems • Reservation Systems • Library Loan Systems • Bill Generating Systems • And many more Slide 25
Discussion Activity Outputs from TPS serves as fundamental inputs for other information systems such as MIS, DSS and EIS. True OR False and Why? Answer: True Slide 26
Process Control Systems This is a category of OSS in which decision about a physical production process are automatically made by computer through routine decisions that control operational process. For Example: A petroleum refining center uses electronic sensors which are linked to the computers to continuously monitor chemical processes and make instant adjustments that control the refined process. Slide 27
Enterprise Collaboration System • This is the information system that uses a variety of information technology to help the people to work together. • ECS helps to collaborate and communicate ideas, share resources and co-ordinate work effort of an organization. • The aim of an ECS is to use the information technology to enhance productivity and creativity of organization and work group in an organization. For Example: Email systems, Chats, video Conferencing etc. Essentially, they are Office Automation Systems . Slide 28
Topic Six MANAGEMENT SUPPORT SYSTEMS Slide 29
Management Support Systems (MSS) • This is generally deals with providing information and support for effective decision making. • Their targets are mostly decision making at the tactical and executive levels. Examples of MSS are: • Management Information Systems • Decision Support Systems • Executive Information Systems Slide 30
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