Chapter 2: Management Information Systems Flashcards
Definition of data
Raw & unprocessed format
Recorded but not yet processed in a way suitable to make decisions
Sits with IT concerned with storage & security
Definition of information
Processed data in a way which has meaning to the person who receives it.
This person can use it to improve the quality of their decisions
What does management require information?
1) provide current & historical records
2) Analyse what is happening to the business
3) Basis on decision making in ST <
4) Monitor the performance to compare actuals and forecasts
What 3rd parties would be interested in info about the business
Owners/ shareholders
Customers & suppliers
Employee
Gov agencies e.g tax
What are the characteristics of good information?
ACCURATE
Accurate
Complete
Cost-effective
Understandable
Relevant
Accessible or authoritative
Timely
Easy to use
What is meant by complete info
Managers should have all info needed but not an excessive amount
What is meant by cost- effective info
Value of info should exceed cost of producing it
What is meant by understandable info
Info is clearly presented & displayed
What is meant by timely info
Info should be provided in sufficient time for decisions to be made
What is data processing
Converting data to info e.g classifying/ sorting/ producing
Can be automated or manual
How can data transformed
summarising data/ basic processing/ statistical and financial analysis/ tubulation
What is information technology (IT)?
Hardware needed for capture, storage, transmission or presentation of info
What are Information Systems (IS)?
Management of systems to support running the business
Needs ready access to necessary data –> discard what’s not needed
Bespoke to company so expensive
Needs to add value where it’s cost-effective
What do Information systems do?
Links organisations to customers & suppliers
effective integration to use info for value-adding process
Orgs can develop/ produce/ market & deliver new products or services based on info
Senior management help to develop and implement strategy
E.g tesco club card
What are the 2 main roles of Information systems
1) Support operations via processing & storing transactions
2) Support managerial activities e.g decision making, planning, performance measurement & control
What do organisations use information for?
1) Record transactions
2) Make decisions
3) Planning
4) performance measurement
5) control
Why do you need to record transactions
1) evidence in disputes
2) legal requirement
3) Build a profile to assess profitability
Why is information used for planning
Availability of resources
Possible timescales etc
What is performance measurement
Enables comparisons of actuals vs budget/ plan
collection of info on costs & profitability
analysis & presentation performed by IS
What is control
Show whether a plan is proceeding as expected / unexpected deviations
IS can monitor project outcomes
How to assess costs of an IS
Cost- Benefit Analysis (CBA)
shows expected losses vs benefits
refined systems= expensive
Skilled staff need for operation= expensive
What are the initial costs of an IS
1) design & develop if bespoke
2) purchasing software if not bespoke
3) purchasing new hardware
4) Cost of testing & implementing
5) training cost
What are the running costs of IS?
1) labour time to run system
2) material cost e.g replacement parts
3) cost of service support
4) Ongoing training costs
What are costs of internal info?
1) direct data capture (barcode scanners)
2) Processing costs ( payroll salaries)
3) Indirect costs (info which isn’t needed/ duplicated)
What are costs of external info?
1)Direct costs (subscriptions)
2) Indirect costs (wastage time finding useful info)
3) Management costs (processing info)
4) Infrastructure costs (systems enabling internet searches)
What are the benefits of a new IS?
Enhanced efficiency & capacity
better quality information
Better access to info
Improved sharing of info
Improved communication
Better decision making and customer service
What is a LAN & WAN?
LAN= Local area network
can share data and to devices e.g printers & emails
WAN= Wide area network
Connects LANS so computers in different locations can connect
What does a network do
Facilitates the transfer of information between different parts of the business
What is the intranet
Internal network used to share info in organisations with employees
Firewall fends off unauthorised access
Benefits of the intranet
Eliminates storage, printing & distribution of documents
More widely used than files in drawers–> improves productivity & efficiency
Easier to update information
What is cloud computing
Access different services via the internet
Data is stored, managed and processed with remote servers for on-demand access
What are some benefits of cloud computing
1)Lower maintenance costs (don’t need physical space & everything done by a 3rd party). Only pay for what’s used and accessed anywher
2) Data easily backed up & updated in real time –> flexible and accurate financial reporting. More efficient than legacy systems
3) Security -service provider pays to fix problems & upgrade so don’t need to pay extra for this
4) Agility- work across the globe on same project at same time
What is the extranet
Collaborative network
Extension to intranet connecting the business to shareholders/ suppliers etc
What is the internet
Interconnected networks/ computers carry info & resources connect via an IP (Internet Protocol) address
Share data quickly
Opens up to viruses & hackers
What is wifi?
Wireless Fidelity
Mobile use of laptops & handheld devices
Used to buy products- firms create apps- makes purchasing quicker
Used to access key info e.g in hospital wards
What are the 2 types of control?
General controls
Application/ program controls
What are General controls
Overall control of IS
Physical control- preventing physical access to hardware e.g locks/ alarms/ cctv
Personnel control- segregating duties/ hierarchy of access/ training/ supervision
Access controls - passwords/ time outs
Computer equipment controls - prevent from destruction/ damage/ theft
Business continuity planning- risk assessing what is critical to the business
What is application/ program controls
Automatically performed by the system
Completeness- all data is processed
Validity- only valid data is input
Identification- Users are identified & authorised
Problem management facilities- recorded problems timely
What are the solutions to the threat of natural disasters?
1) Fire procedures- alarms/ extinguishers/ doors/ training/ insurance
2) Location- not in a place liable to disasters
3) Physical environment- air con/ dust control
4) Back up procedures - regular basis for recovery
What are the solutions to the threat of a malfunction?
1) Network design - cope with periods of high volumes
2) Back up procedures
What are the solutions to the threat of a Viruses?
1) Anti-virus software (updated regularly to prevent corruption)
2) Formal security policy & procedures
3) Regular audits to check for unauthorised software
What is a virus
Small program that once introduced to the system spreads extensively
Can affect the whole system
What are the solutions to the threat of a hackers?
1) Firewall software- protection from unauthorised access to the system from the internet
2) Passwords/ usernames- Limits unauthorised access to the system
3) Formal security policy & procedures- when using personal devices at work there should be a policy to prevent hackers
4 ) User awareness training of risks should be available
5) Data encryption - scrambled prior to transmission. Recovered in a readable format once transmission is complete
What are the solutions to the threat of a Electronic eavesdropping?
1) Data encryption
2) Passwords/ Usernames
What is hacking?
Deliberate access to systems by unauthorised persons
What are the solutions to the threat of a human errors?
Training & operating procedures
Definition of human errors
unintentional errors from using computer & networks
What are the solutions to the threat of a human resource risk?
Ergonomic design of workstations- reduces problems such as RSI
Anti-glare screens to reduce eye strain
Cables in ducts
What is human resource risk
Repetitive strain injury (RSI), headaches and eye strain from computer screens, tripping over loose wires
What is wikileaks
Not-for-profit org
protects whistleblowers & journalists with sensitive info to communicate to public
What is an input control & an example?
Inputs should be complete, accurate & authorised
Passwords
What is a processing control & an example?
Should be initiated by appropriate personnel & logs kept of any processing
Audit trails
What is an output control & an example?
Should be available to authorised persons & 3rd parties only
Distribution lists
What are the 7 different controls over input
IFRSCCM
1) Input
2)Format checks
3) Range tests
4) Sequence checks
5) Check digits
6) Control totals
7) Matching
What is the input method?
Ensure data is authorised & provides a software audit trail
What is the range tests control method?
Ensure data is accurate
E.g month fields to be in the range of 1-12
What is the format checks control method?
Ensures data is accurate
Everything in the correct format to be read and processed correctly
What is the check digits control method
ensures accuracy
specially constructed numbers to comply with a mathematical test
What is the sequence checks control method
ensures completeness
everything is accounted for
What is the matching control method?
completeness
What is the control totals control method
Ensures accuracy, completeness & authorisation as input batches can be authorised manually
What are controls over processing
Passwords software audit trails track what processing is carried out
Programs shouldn’t be altered without authorisation & testing otherwise incorrect/ fraudulent processing can be carried out- incorrect/ fraudulent processing can be carried out
What are controls over output
Password systems- each one allocated suitable access rights
Sensitive printed output- distribution list & physically safeguarded
What are controls over output
Password systems- each one allocated suitable access rights
Sensitive printed output- distribution list & physically safeguarded
What are logical access controls
Passwords/ usernames identify who has access to the system/ grant access to the system or files
Can have several levels of passwords
What are firewalls
Combination of hardware & software between the intranet & internet
Control procedures established to allow public access to some parts of the the org’s computer system (outside firewall) while restricting access to other parts (inside firewall)
What is data encryption
Disguising info to preserve its confidentiality
scrambles the data to be unintelligible unless it’s unscrambled/ decrypted
What is virus protection
Control on use of external software (check for viruses before using new software)
Antivirus software, regularly updated to detect & deal with viruses
Educating employees to be watchful for viruses part of attached files to emails
What is data visualisation?
allows large volumes of complex data to be displayed in a visually appealing/ accessible way to facilitate the understanding of underlying data
Improves clarity & impact
Technology in data visualisation
Customisable, interactive 3D formats to manipulate and drill down in data
Find data through intuitive, user-friendly interface
What 5 features should a features should data visualisation have
1) Decision - making ability (results focused)
2) Effective infrastructure (Output is reliant on sufficient quality & quantity of data)
3) Integration capability (with existing systems & business overall)
4) Prompt discovery of rules & insights (live data vital)
5) real- time collaboration
What are the key benefits of IT data visualisation tools
1) Accessible
2) Real-time
3) Performance optimisation
4) Insight and understanding
What is the benefit of accessibility
User-friendly and intuitive
What is the benefit of working in real-time for IT data visualisation
Clear and informative
quicker responses
What are the benefits of performance optimisation for IT data visualisation
immediacy & clarity of info being displayed
Better decision making
Proactive
Efficient utilisation of resources as problems identified promptly
What are the benefits of insights & understanding for IT data visualisation
Combines data & visualising
Improved understanding
Fresh insights about cause & effect of data
What is report visualisation used for?
Allows managers to access relevant, timely & accurate info.
Presented in an easily digestible way for effective decision-making
What is report visualisation?
presents large volumes of data in an understandable format
What are key requirements of report visualisation?
1) info personalised to user for optimal understanding
2) Info interactive to focus on relevant areas
3) delivery channel optimised
What are key features of report visualisation?
1) Dashboards
2) Tools
What are dashboards
summarised overview of info
starting point
Receive real-time info on current performance
Helps hit pre-determined targets - instant feedback & fixes
Drill down to data where necessary
What are tools
Waterfall charts/ bridges - shows variances / detail about movements
Line charts- identify trends/ establish baseline for future performance
Mapping charts- geographical divisions
Pie charts- comparing data sets of component parts
