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Chapter Thirteen

Chapter Thirteen. Information Technology in Management. Chapter Outline. Managing a Business or Organization Information Technology to Support Managerial Decision Making. The Traditional Functions of a Manager. Managers seek to accomplish organizational goals.

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Chapter Thirteen

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  1. Chapter Thirteen Information Technology in Management

  2. Chapter Outline • Managing a Business or Organization • Information Technology to Support Managerial Decision Making  1999 Addison Wesley Longman

  3. The Traditional Functions of a Manager • Managers seek to accomplish organizational goals. • Information technology supports managerial functions.  1999 Addison Wesley Longman

  4. The Traditional Roles of a Manager • Managers may need to perform all three roles at one time.  1999 Addison Wesley Longman

  5. Types of Management Decisions • Managers use several methods to solve different types of problems in a variety of situations.  1999 Addison Wesley Longman

  6. Levels of Management  1999 Addison Wesley Longman

  7. Information Requirements of a Manager • Organizational goal: • Provide the right information at the right time in the right form. • Example: semistructured decision about a marketing plan. • Historical sales data • Future-oriented sales data  1999 Addison Wesley Longman

  8. Dimensions and Characteristics of Information: Time • Timeliness • Currency • Frequency • Time period  1999 Addison Wesley Longman

  9. Dimensions and Characteristics of Information: Content • Accuracy • Relevance • Completeness • Scope  1999 Addison Wesley Longman

  10. Dimensions and Characteristics of Information: Form • Clarity • Detail • Order • Presentation • Media  1999 Addison Wesley Longman

  11. Information and Management Levels  1999 Addison Wesley Longman

  12. Information Technology and Managerial Communication • Information technology can: • Increase the number of messages transmitted to more people • Ensure messages go only to those who need the information • Eliminate unnecessary time delays • Vary the form of the message with multimedia.  1999 Addison Wesley Longman

  13. Communication Concepts • Communication is the expression of an idea. • Communication is sent through a channel. • Communication requires a receiver. • Feedback clarifies garbled messages.  1999 Addison Wesley Longman

  14. Collaborative Work  1999 Addison Wesley Longman

  15. Office Automation Evolution • Mainframes were used for accounting and payroll. • Personal computers with office application software became popular. • Power struggles often occurred between mainframe and PC supporters.  1999 Addison Wesley Longman

  16. Office Automation Evolution • Today companies network PCs, mainframes and thin clients together. • Groupware allows sharing calendars, documents and messages among workers.  1999 Addison Wesley Longman

  17. Distributed Computing • Today companies may have PCs, mainframes, workstations and thin clients networked together. • Workers may access mainframe database using their PC or terminal. • Workers may use Web browser to access data on company intranet. • May not even know where the data is stored.  1999 Addison Wesley Longman

  18. Paperless Office • Computers now deliver more mail messages than postal carriers. • The volume of on-line publishing is rapidly growing. • The amount of paper used is not decreasing as much as once predicted, but we do use paper differently.  1999 Addison Wesley Longman

  19. Information Technology and Decision Making • Decision making involves: • Understanding the problem • Identifying possible solutions • Selecting the most desirable solution • Implementing the decision.  1999 Addison Wesley Longman

  20. Types of Decision Making Models • Mental model: how a person’s beliefs, assumptions, and interpretation of reality are organized. • Mathematical/quantitative model: reality represented as numerical relationships among key variables (e.g., budget spreadsheet).  1999 Addison Wesley Longman

  21. Types of Decision Making Models • Analog model: pictorial representation of a situation (e.g., organizational chart, stock market graph). • Iconic model: physical replica of reality (e.g., CAD developed scale model of a product).  1999 Addison Wesley Longman

  22. Individual Decision Styles • Reflect how individuals: • Emphasize certain phases of decision making • Use certain types of models • Use information in unique ways • Emphasize certain beliefs and values.  1999 Addison Wesley Longman

  23. Individual Decision Styles • Rational • Satisficing • Systematic • Intuitive • Bureaucratic • Political • Garbage can  1999 Addison Wesley Longman

  24. Supporting Decision Makers with Technology • Information systems that effectively support decision making will be flexible and adaptable enough to support a variety of individual and organizational styles.  1999 Addison Wesley Longman

  25. Management Information Systems (MIS) • Managers use the system to access corporate business process information.  1999 Addison Wesley Longman

  26. Management Information Systems (MIS) • Give managers the information needed to make decisions about operational activities. • Provide three types of reports: detailed, summary and exception. • Typically provided to managers as scheduled reports.  1999 Addison Wesley Longman

  27. Decision Support Systems (DSS) • Managers can use the system interactively to analyze data.  1999 Addison Wesley Longman

  28. Decision Support Systems (DSS) • Useful for non-routine decisions • Managers manipulate information • Three major components: • Data management • Model management • Dialog management.  1999 Addison Wesley Longman

  29. Group Decision Support Systems (GDDS) • Groups of managers use the system interactively to analyze data.  1999 Addison Wesley Longman

  30. Group Decision Support Systems (GDDS) • Physical configuration: • Room with appropriate computers • DSS database and modeling software • Local area network connections • Large-screen projections of computer output for group viewing • Communication-oriented software tools for idea generation and sharing.  1999 Addison Wesley Longman

  31. Group Decision Support Systems (GDDS) • Prior to the meeting, managers can use the GDDS software to perform sensitivity analysis. • During the meeting, managers can: • Show their earlier work to others • Use GDDS software tools to brainstorm and organize their ideas.  1999 Addison Wesley Longman

  32. Geographic Information Systems (GIS) • Special type of DSS designed to work with map and other spatial information including: • Mapping and analytic software • Databases of map images, geographic and demographic data • User interface allowing queries and results shown on a map.  1999 Addison Wesley Longman

  33. Uses of a GIS • A GIS can be used to: • Identify the best location for a new retail store • Analyze customer preferences in a given geographical area • Plan delivery and service routes • Assist governmental employees such as city planners or law enforcement personnel.  1999 Addison Wesley Longman

  34. Executive Information Systems (EIS) • Used to monitor important economic and social trends affecting the company and corporate performance.  1999 Addison Wesley Longman

  35. Executive Information Systems (EIS) • An EIS has similar design components to a DSS • Data management component provides interactive access to data on the company’s critical success factors • Model management component includes analytical models to identify and study trends in critical success factors • Dialog management components provides a variety of output formats.  1999 Addison Wesley Longman

  36. Executive Information Systems (EIS) • An executive can use the EIS to drill down through the available information to the level of detail needed. • Access to up to data internal and external information makes an EIS particularly helpful during the intelligence phase of decision making.  1999 Addison Wesley Longman

  37. Expert Systems (ES) • Expert answers are provided to a user’s questions in an interactive process.  1999 Addison Wesley Longman

  38. Expert Systems (ES) • An expert system supports decision making by providing managers with access to computerized expert knowledge. • Such systems are based on years of artificial intelligence research.  1999 Addison Wesley Longman

  39. Knowledge Bases for Expert Systems • Researchers have had little success at developing systems with broad, shallow knowledge such as known by children. • Researchers have had success when the knowledge base is restricted to narrow, deep domains.  1999 Addison Wesley Longman

  40. Knowledge Base Information • A knowledge base may contain 200 to 10,000 if-then rules, which incorporate uncertainty as “fuzzy” rules. • Example from MYCIN, a medical expert system: • If (1) the infection is primary-bacteremia, and • (2) the site of the culture is one of the sterile sites, and • (3) the suspected portal of entry of the organism is the gastrointestinal tract, then there is suggestive evidence (.7) that he identify of the organism is bacteriodes.  1999 Addison Wesley Longman

  41. Expert Systems in Perspective • An expert system can: • Help train new employees • Reduce the number of human errors • Take care of routine tasks so workers can focus on more challenging jobs  1999 Addison Wesley Longman

  42. Expert Systems in Perspective • Provide expertise when no experts are available • Preserve the knowledge of experts after those experts leave an organization • Combine the knowledge of several experts • Make knowledge available to more people at different locations.  1999 Addison Wesley Longman

  43. Expert Systems in Perspective • Limits of expert systems: • Difficult to build, particularly the knowledge base component • Poorer at planning strategies than human experts • Less creative than human experts • Powerless outside their narrow, deep domain of knowledge.  1999 Addison Wesley Longman

  44. Comparison of System Design Features  1999 Addison Wesley Longman

  45. Information Systems in Perspective • Information systems often do not fit neatly into one of the five information systems discussed (automated office systems, MIS, DSS, EIS, ES). • The design features incorporated into an information system should be based on the communication and decision making needs of users.  1999 Addison Wesley Longman

  46. Information Systems in Perspective • These tools provide information and advice, with some risks. • Poor system design limits decision quality. • Managers may feel overwhelmed with information. • User training is essential. • A system cannot totally replace the human communication and decision-making skills necessary for successful management.  1999 Addison Wesley Longman

  47. After reading this chapter, you should be able to: • Describe several aspects of management, the information needs of managers, and the types of decisions managers make • Explain several basic communications concepts  1999 Addison Wesley Longman

  48. After reading this chapter, you should be able to: • Discuss several ways that information technology is used to help managers collaborate and communicate more effectively • Explain several decision-making concepts  1999 Addison Wesley Longman

  49. After reading this chapter, you should be able to: • Describe several ways that information technology is used to help managers make decisions more effectively • Discuss the issues that should be included in an organization’s information code of ethics  1999 Addison Wesley Longman

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