DEPARTMENT OF MANAGEMENT STUDIES

1 M.B.A. 3rd SEMESTER

Subject: Decision Support System & Management

Information System

A Presentation Report on the Topic

“Executive Information System”

Guided By: Submitted By:

Dr. Chandrawati Nirala Alok Pandey

(Assistant professor) Ayushi Jaiswal

Ragini Kumari
 Executive Information System (EIS)
• An information system that provides strategic information tailored
to the needs of executives and other decision makers.
• An Executive Information System (EIS) is a computer-based
system intended to facilitate and support the information and
decision-making needs of senior executives by providing easy
access to both internal and external information relevant to meeting
the strategic goals of the organization. It is commonly considered
2 as a specialized form of Decision Support System (DSS).

• Matthews, R., and A. Shoebridge. "EIS--A Guide for Executives." Long Range Planning (December 1992):94-101.
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History of EIS
 Traditionally, executive information systems were developed as mainframe computer-
based programs.
 The purpose was to package a company's data and to provide sales performance or market
research statistics for decision makers, as such financial officers, marketing directors, and
chief executive officers, who were not well acquainted with computers
 The objective was to develop computer applications that would highlight information to
satisfy senior executives' needs.

• Matthews, R., and A. Shoebridge. "EIS--A Guide for Executives." Long Range Planning (December 1992):94-101.
 The Purpose of EIS
Senior managers need systems that address strategic issues and long-
term trends, both in firm and in the external environment. They are
mainly concerned with the following frequently asked questions so as
to find the suitable solutions.

➢What will employment levels be in 5 years?

➢What are the long-term industry cost trends, and where does our
4 firm fit in?
➢How well competitors performing?

• Matthews, R., and A. Shoebridge. "EIS--A Guide for Executives." Long Range Planning (December 1992):94-101.
 Characteristics & capabilities of EIS
• Drill Down
• Critical Success Factors (CSFs)
• Status Access
• Analysis
• Exception Reporting
• Use Of Colors and Audio
Typically, critical items are reported not only numerically but also in colour. For example,
GREEN for OK
5 YELLOW For WARNING
RED For DANGER that means the performance outside the preset boundaries of
the plan.
• communication

• Matthews, R., and A. Shoebridge. "EIS--A Guide for Executives." Long Range Planning (December 1992):94-101.
 Components of EIS
1.Hardware
(1) Input data-entry devices
(2) The central processing unit (CPU)
(3) Data storage files
(4) Output devices
2.Software
1. Text base software
2. Database
3. Graphic base.
4. Model base
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3.User Interface
1.Schduled reports
2.Command Languages
3.Natural languages

4.Telecommunications
• Watson, HJ., et al. "In Depth: Soften Up!" Computerworld (October 19,1992):103-105.
 Model of Executive information system

• Watson, HJ., et al. "In Depth: Soften Up!" Computerworld (October 19,1992):103-105.
 Applications of EIS
• Manufacturing
• Marketing
• Financial

Benefits of an EIS
• integrating information
• Specialized Displays
• Rapid Development

8 • Strategic Sales Advantage

• Competitive Advantage

• Watson, HJ., et al. "In Depth: Soften Up!" Computerworld (October 19,1992):103-105.
 Limitations of an Executive Information
System

• Passwords
• Data Access
• Executive Information
• Limited integrated view
• Costs
9

• Watson, HJ., et al. "In Depth: Soften Up!" Computerworld (October 19,1992):103-105.
 Difference between EIS & DSS
10 Dimension Executive Information System Decision Support Systems

Focus Accessing of Status, drill down. Analysis for decision support.

Typical Users Senior administrators. Professionals, Analysts, managers.

Performance evaluation, environmental

scanning, identification of problems They are applicable in different areas
Application and opportunities. where managerial decisions are made.

Supports semi-structured and non-

Supports indirectly high-level and programmed decision-making, ad-hoc
Decision Support unstructured decisions and policies. decisions etc.

News items. customers information,

Information supporting particular
situations, competitors, and the external
Type of Information
environment: scheduled and demand Information supporting particular
reports on internal operations. situations.

https://www.techslang.com/definition/what-is-an-executive-information-system/
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Adaptability to Permits individual judgments, what-if

Custom-made to the decision-making style of
Individual Users capability some choice of dialog style.
each individual executive, offers several
alternatives of outputs.

Graphics Graphics are necessarily used for EIS It is the main part of many DSS.

If no intermediaries are used, then user-

User Friendliness User-Friendliness is necessary for EIS. friendliness is must for DSS.

Supporting Detailed Immediate access the supporting details of This can be programmed into the DSS but
Information any summary. generally not happens.

Principal Use
EIS is used for tracking and controlling as well as DSS are mainly used for planning, organising,
identification of opportunity. staffing, and controlling.

https://www.techslang.com/definition/what-is-an-executive-information-system/
 Case Study
“Phillips66 Company”
The EIS implemented by the Phillips 66 company is an example of successfully using key business-indicator
information to support executive decision making. This EIS uses external information from market sources-not internal
information from the accounting system-to produce effective decisions made in a decentralized organization.
In 1987, phillips faced a problem with pricing its petroleum products as a result of a company-wide reorganization.
Because they lacked the timely information needed for flexible price setting, senior executives had to set standardized,
corporate-wide petroleum prices that priced phillips out of some local markets every day. As part of the reorganization,
phillips had eliminated many middle management positions and was trying to design a pricing information system that
would support management at all levels in its decentralized organization. This information system needed to integrate
information on competitors' prices, the petroleum market spot prices, and phillips' internal cost and supply levels, all
on a daily basis.
To alleviate this pricing problem, phillips designed an EIS that gathered daily information on phillips' pricing in each
local market and compared it to local competitors' prices and to the market spot prices. This price information was then
correlated with the daily sales volume of that specific market. The result was displayed as on-screen price-volume
graphs and charts, showing trends over the prior sixty days.
This information was made available to both local market managers and senior executives in the corporate office.
12 Because the local market managers had been given the responsibility of making pricing decisions, the senior executives
were free to simply monitor pricing activity.
The impact and importance of this system of decentralized pricing, and the eis that supported it, was enormous.
Phillips estimated that for each day its pricing was off by one penny, the company lost $40 million in annual profits.
Phillips designed its information system around providing the information needed to support a key business decision,
its daily selling price. They then put both the pricing information and decision-making responsibility in the hands of
the local market managers who were in the best position to make the decision. Phillips met its business objectives by
effectively
•Watson, HJ. etimplementing the103-105.
al. "In Depth: Soften Up!" key elements of an EIS to support executive decision making.
 Conclusion

An executive information system is designed to facilitate the use

or review of information from both internal and external
sources. Typically, EIS provide the ability to use this
information to support executive decision making. One popular
information format uses a drill-down approach where executives
start at an aggregate level of accounting data and investigate
successively more detailed information with each additional
inquiry. Another format uses summaries of critical information
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gathered from external sources.
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