MIS vs.

DSS
Management Information Systems vs. Decision Support Systems

MIS: The Big Picture

MIS provides information about the performance of an organization Think of entire company the firm! as a system. "n MIS provides management #ith feedback

MIS: The Big Picture

The $irm
Processing Input: %a# Materia&s' Supp&ies' Data' etc.

MIS
Managers' (Ps' )*+

Output: Products' Services' Information etc.

MIS: $eedback for a $irm

,: -o# are #e doing. ": /ook at the report from the MIS

0eneric reports: Sa&es' +rders' Schedu&es' etc. Periodic: Dai&y' 1eek&y' ,uarter&y' etc. Pre2specified reports

+bvious&y' such reports are usefu& for making good decisions.

-o# is a DSS different.

MIS DSS Periodic reports Specia& reports that may on&y be generated once

Pre2specified' generic reports

May not kno# #hat kind of report to generate unti& the prob&em surfaces3 specia&ized reports.

MIS vs. DSS: Big Differences

In a DSS' a manager generates the report through an interactive interface

$&e4ib&e 5 "daptab&e reports

DSS %eporting is produced through ana&ytica& mode&ing' not 6ust computing an average' or p&otting a graph.

Business Mode&s are programmed into a DSS

Types of Decisions
Operational Unstructured Tactical Strategic 7e# e2business initiatives )ompany re2organization Semistructured Production Schedu&ing *mp&oyee Performance Mergers *va&uation Site /ocation )apita& Budgeting )ash %e2engineering a Management process

Structured Payro&&

MIS vs. DSS: "nother Difference

TPS
Operational Management Decisions

DSS
Tactical Management Decisions Strategic Management Decisions

MIS

*IS

Strategic Management

The Peop&e

Decisions

Board of Directors )hief *4ecutive +fficer President

Deve&op +vera&& 0oa&s /ong2term P&anning Determine Direction

Po&itica& *conomic )ompetitive

Tactica& Management

Peop&e

Decisions

Business 8nit Managers (ice2President to Midd&e2Manager

short2medium range p&anning schedu&es budgets po&icies procedures resource a&&ocation

+perationa& Management

Peop&e

Decisions

Midd&e2Managers to Supervisors Se&f2directed teams

short2range p&anning production schedu&es day2to2day decisions use of resources enforce po&ices fo&&o# procedures

Decision Structure
8nstructured

Information

!aracteristics
"d -oc 8nschedu&ed Summarized Infre9uent $or#ard /ooking *4terna& 1ide Scope

Strategic Management

Semi2structured Tactical Management Pre2specified Schedu&ed Detai&ed $re9uent -istorica& Interna& 7arro# $ocus

Structured

Operational Management

MIS vs. DSS

MIS
Support %eport $orm $ormat Info about performance Periodic reports or +n Demand Pre2specified $i4ed format

DSS
Info and modeling to ana&yze prob&ems Interactive In9uiries $&e4ib&e and "daptab&e "na&ytica& mode&ing of data

Processing *4tract and manipu&ate data

1hat is "na&ytica& Mode&ing.

*4amp&es Supply !ain Modeling : Simu&ate #hat #ou&d happen if you reduced your inventory.

-o# many items #ou&d go out of stock. -o# much #ou&d you save. Is reducing inventory a good thing.

More Mode&ing
Price Point Modeling : mode& #hat #ou&d happen if you &o#ered or raised the price of your product uses information about

your customers income and your competitors prices

uses #e&&2kno# supp&y and demand mode&s

Typica& MIS %eporting

Periodic Sc!eduled "eports

*4amp&e: Month&y $inancia& Statements *4amp&e: /ist of items out of stock

#$ception "eports

These reports contain information but they might not direct&y he&p you determine the best decision to make.

More MIS %eports

Demand "eports and "esponses

"vai&ab&e #henever a manager needs them' updated in rea&2time. Information is pushed to a managers computer *4amp&e: %eport is pushed every time a supp&ier is &ate #ith a shipment

Pus! "eporting

MIS %eporting is a&& about giving managers feedback and doesn;t necessari&y he&p direct&y #ith decision making.

-o# is DSS reporting different.

Mode&ing he&ps predict the outcome of a decision. This direct&y he&ps you make a decision

Possib&y an optima& decision

1ith a DSS you can e4p&ore possib&e a&ternatives.

"na&ytica& Mode&ing is the key

Type of Modeling %!at-if analysis Sensiti&ity analysis #$ample 1hat if #e cut advertising by <=> #hat #ou&d happen to sa&es. /et;s cut advertising by <> repeated&y so #e can see its re&ationship to sa&es

'oal-seeking /et;s try increasing advertising unti& sa&es analysis reach ?< mi&&ion Optimi(ation analysis 1hat &eve& of advertising ma4imizes our overa&& profit.